Wednesday, October 31, 2012

Apple a big mover on wednesdays open

3 month chart testing 200day (bearish channel)
If you were paying attention to the pre market, you saw that at a few point $AAPL was down as much as 7 points before open.  Apple continued down on the open testing the 200day support (587.70) two times with a low of about 587.50.  After testing that support two times, and anticipating a third, at about 11:10, it began a strong break out to to the upside to break the trend.  These are key analytical point of Apple, testing the HUGE 200day support twice, both bouncing off, and a spontaneous break to the upside.  Historically after testing the 200day Apple has made historic rallies within about 20 days time, of anywhere to 10-20%.  Be prepared to change your bearish technical mindset to bullish if it decides to  break through its previous day high of about 614.00.  Here is a 3 month chart showing the 200day test, along with a intraday chart showing small double bottom testing, along with the spontaneous break out.

Intra day low support of 587.50

Tuesday, October 30, 2012

How to play the STORM

3month daily chart $WMT
So as everyone is aware, hurricane sandy has made its way up the East coast, and had it out with the worst for New York City, and New Jersey.  With winds up to 80mph, heavy rain causing vast flooding throughout the Northern East coast, this sets up a few thoughts of how could I take advantage of the disastrous situation.  First things that comes to mind for me would be $WMT $HD $LOW.  You could potentially get into some insurance companies due to the projected 2-5 billion dollars in repairs, but I'd like to stick to the near term.  Giant retail, and home repair.  $WMT, wal-mart, could potentially be a great play. Prior to the storm I got the opportunity to go into multiple wal-mart stores in Fairfax, Va, and Manassas Va.  Both stores had shelves completely empty, multiple employees talking about being sold out of water, batteries, flashlights, and other goods you would want to stock up on before losing power or being stuck at your house for a long period of time.  Clearly these only effect the fundamentals in the long term, maybe a spike in revenue for the quarter, maybe not, they are a trillion dollar annual revenue company, and the event was consolidated to the East coast, so you may see it may not.  We're trying to play the mass psychology of the market, not the near term fundamentals of the situation.  Investors are going to be looking for these large retailers supplying all kinds of good, to try to get a spark on what may be a down market come Wednesday.  $WMT closed Friday at 75.11 with near term resistances of 75.50, 76.71, and 77.23.  Pay attention to the futures in the morning, and the pre-market action all across the board, and make an action decision based on what you see, the move is either there or its not.

$HD Home Depot, could be a potential move for obvious reasons.  Home Depot is the national standard for home improvement followed by $LOW Lowe's.  Both these companies are going to be the go to for personal repairs and renovations, along with the contractors insurance companies hire to do the work they are obligated to provide.  You're going to want to keep an eye on all three of these stocks to look for movement in the pre-market, DON'T CHASE THE STOCK.  Like I said above, the move is either there or it is not.  Review the technicals,  be aware of the market trend, and any stock related news prior or during market hours.

As you can see in the $HD chart, you might say it looks some what bearish, looking to test the 50day at 59.11, current stock price is at 60.04.  We want to see bullish pre market action Wednesday morning for a set up.  Three near term resistance points to keep an eye on are 60.31, 61.06, and 61.89.

$HD 3month daily

$LOW 3month chart you see moderate growth of the stock perform with the market, or some what bullish.  The past couple days have started a short term down trend below the 20day, so you want to be looking for it to not only break that down trend, and break above the 20day, but also break through resistances 1, 2, and 3.  The stock price is 31.36, and the resistances are 32.16, 32.40, and 32.62.

Good luck to all.

Apple post earnings and executive "shakeup"

6month daily chart testing 200day
As you know by now, Apple for its second earnings release in a row managed to miss at a time most individual investors expected an easy hit.  Institutions and market makers became skeptical of Apples earnings just two days before release due to a subtle "release" of an Ipad sales projection during the release of the new Ipad mini.  As Tim Cook continued Apple's usual quarterly Accolade announcement for sales, app store downloads, etc he happened to mention that Apple sold their 100 millionth Ipad just two weeks ago.  While this might sound attractive to the individual investor thinking about the staggering Iphone 5 sales the first week, along with the release of the product in a large amount of other countries prior to the end of the 4th quarter, September 29th.  Supply issues hung in the midst looming over Apple's head taking the stock from a high of just above 700 down to a near term low, along with testing the 200day after hours following earnings release.  As you can see on the 6 month daily chart, the 200day was tested, there is a clear down trend channel with some what bearing indicators.  This is a very important direction point in Apple where it decides whether it wants to test the 200day again, and potentially continue lower in the the high 500's following the channel on the chart, or break to the upside out of the channel, and attempt a recovery off of these short term lows.  Apple is a buy for me if it does one of two things, tests the 200day and bounces off of that major support for some upside, or rather break the channel to an upward trend.  Until then I will be doing charting and trading weekly options depending on market direction.

Also huge news at Apple that could be a short term directional indicator of mass psychology on wall st. senior vice president of iOS software, Scott Forstall, is set to leave the company next year after close to 15 years with the company, along with John Borwett, Head of Apple retail.  These are real key players at Apple, and al though the market has been closed for the past two days, 10/28, and 10/29, I am eager to see how the market reacts to hurricane sandy, and the reaction to the recent Apple miss and executive "shake up".