Daily Watchlist - 20/1/10

Hi All,

Notes: I am changing to scan by Metastock. I feel that it can filter better than finviz.

The new moon on 16th Jan 10. - peak?
Full moon on 30 Jan 10. - bottom?

I have not read Chang's article. Will try to confirm the relationship after reading it.

Feel free to comment or give suggestions to improve trading the setup.

Bulls Scan Results
DVN - 20/1/10: Bullish engulfing in TAZ30 and on resistance turn support area. XLE 3rd coldest sector.
AGU - 20/1/10: Harami hammer. XLB RS Up but AGU RS down. GMMA good.
CAM - 20/1/10: Piercing pattern. XLE RS present but CAM RS down.
JPM - 20/1/10: Spinning top. XLF and JPM RS present. Good GMMA.
SWN - 20/1/10: Hammer on TAZ30. XLE and SWN RS up. GMMA good.
UNP - 20/1/10: Very good GMMA. Hammer on T30. XLI RS up.
USO - 20/1/10: Piercing pattern. GMMA not good. XLE RS up.
COH - 20/1/10: Hamari hammer. Very good GMMA. COH RS up but XLY down.

Bears Scan Results
TLT - 20/1/10: Evening Star.

Still NA....I think if someone has a rule to identify price near resistance level please let me know. I'm currently switching to Metastock to scan optionable stocks in US.

Review (Watchlist)
Bulls

1. SINA - 10/12/09: Entry at $44.27. Target $47.95. Stop loss $42.57. 9/1/10: Doji on EMA30. Now $447.63. Relative strength weakening.
   
2. UUP - 12/1/10: Broke out of downtrend channel resistance. 1st pullback to TAZ but now below EMA30. Will continue to monitor just to see where USD goes. Now $22.84. RS weakening.
   
3. EMN - 13/1/10: Hammer T30. XLB 4th hottest sector but relative strength down. Entered at $60.39. Stop loss $59.38 Target $62.01. Now $61.81
   
4. HGSI - 14/1/10: T30 hammer. XLV relative strength break out.  Entered at $30.01. Stop loss $28.92 Target $31.95. Now $29.82.
   
5. IOC - 20/1/10: Bullish harami in TAZ30. XLE 3rd hottest sector. IOC RS broke out of resistance. Wait for W%R oversold. Now $72.82
   
6. WLT - 18/1/10: hammer in TAZ50. XLI hottest sector. RS up. 20/1/10: Entered at 75.47. Stop loss $73.41 Target $82.85..
7. MOS - 18/1/10: harami Doji in TAz30. XLB 2nd Coldest sector. 20/1/10: Entered at $61.57. Stop loss $60.66 Target $67.92.
   
8. TRA -  Metastock showed no gap. Data adjusted. Bullish engulfing on Metastock chart in TAZ30. XLB 2nd Coldest sector. Cold sector. Skip trade.
   

Bears

1. CHL - 6/1/10: doji at SMA50 resistance. Relative strength still down. IXP sector is also losing strength. Entry at $47.16. Stop loss $47.34. Target $45.13. 7/1/10: Did not trigger but CHL is in a nice downtrend. Will continue to monitor to see if price will go down from here. So far when price is near the downtrend resistance, it goes down fast. 12/1/10: Broke out of channel with huge volume. If price shoot pass SMA200, time to look for 1st pullback to TAZ. Now 50.00 - Hit supply and came down with market. Testing resistance turn support now.
2. MON - 15/1/10: I got this from the bull scan but the price just hit a supply level and dropping off. I'm not trading this counter but will just monitor to see how the supply zone will work out.

Net: +$1757. (Details pls see table)


Objective:
My objective of this project is to study the win/loss rate of this system. Thus, position sizing is not the main priority here. The trades will be simulated with 100 shares of stocks per trade. Another reason is, risk control with options will be different to individuals depending on the strike price and months that one pick, thus we will not use options in the analysis.

TAZ - Profit & Loss Analysis v1.0.xls:
This is the summary of all the trades taken by TAZ method (with more simplified rules). This excel will tabulate the expectancy return of the system and reflect if there is any tweaking need to be done when market condition changes.

Finviz Scan:
Bull Scan:
Optionable stock.
Price > $20.
ROE > 10%
Price < SMA20.
Price > SMA50
Price > SMA200.
MOV(Vol,30,S) > 2000,000 (Adjustable if too many stocks)
ATR > 0.75

Bear Scan:
Optionable stock.

Price > $20.

Price > SMA20.
Price < SMA50
Price < SMA200.
MOV(Vol,30,S) > 2000,000. (Adjustable if too many stocks)

ATR > 0.75

Rules (For filtering too)
Never trade outside TAZ (EMA30, SMA10), except if SMA50 is historically a strong support/resistance.
Buy only if W%R(10) is oversold, sell only if W%R(10) is overbought. (Will monitor as oscillator may not work well when trending.)
Wait for candlestick confirmation even if in the Supply or Demand Zone.
Confirmation will be based on open/close/high/ low depending on candlestick pattern.
Watch for price reversal at 50% retracements of daily Engulfing patterns, Piercing pattern and dark cloud covers in 5 min chart.
No volume analysis. (Guppy's theory of Volume following price)
Make sure the trend is confirmed with nice GMMA.
Long when SPX is up. Short when SPX is down. Read Pre-market indicator by Stephen Bigalow.
Exit trade only when stop loss is hit or target is hit. We want to see how far the trend last or how soon the stop out is hit. (This calculation is in the excel)
Price should move after Candlestick Reversal pattern. If they don't, cut the trade after 3 days. (May not apply to options)

Regards,
Lewis