Note to self - stop fighting market

This rally seems to be getting a little out of hand. Almost like we need a downtick rule to keep irrational exuberance in check. Speculators are profiting from stocks going up! I keep trying to stubbornly short though and am missing some of the upside moves out there. Solar stocks were on fire today. TSL and FSLR had some very nice volume. So what if it's insane, there is money to be made from extreme emotions.

Warning: as soon as I come around to going long that usually means the market is about to nosedive.

Friday trade - FWLT

This is the first time I've traded an h pattern. Jamie and Anarco swear by them, so I was pretty confident when I saw this pattern set up in FWLT. The target of the pattern was about 18.2, the optimistic target was 18, filling the March 23rd gap down. The breakout bar was nice but lacked volume. The move slowed during the Bernanke speech at noon, but it wasn't seeing any volume and was weak relative to the market so I held on. I exited (early in hindsight) for the following reasons for a 2.6R win:

Extreme TICK reading

Quadruple OPEX day, didn't want to push it

S&P was approaching 775 support level

Sharp move down felt like a possible knee jerk Bernanke speech over reaction

Capitulation volume at S2

Setup: 75

Wednesday skipped trade - KBH

I skipped this cup and handle because this was FOMC day and the market was very choppy.

Setup: 75

Friday missed trade - KBH

I was looking at homebuilders on Friday because they had a very weak opening 15 minute bar. KBH had a nice run up into resistance at 11 on declining volume on the daily chart. It bounced off of 11.20 and put in a tweezer reversal on the 5 and 10 minute charts and a hanging man on the 15. Even if I had got the order in at the break of 11, KBH moved from 11 to 10.9 in about two seconds so I might not have been filled.

Friday trade - AMAT

I traded this as a speculative double bottom. If you buy at a strong support level that is likely to hold, then the worst case is you break even (in theory). Trader Stewie often makes these trades in choppy conditions. AMAT has strong support at 8.5 on the daily chart. This stock tends to move in fifty cent increments. After 25 minutes of AMAT barely moving, I exited at break even. I'm trying to be quicker to fold a trade that isn't working right away. The TICK never broke 100 and it seemed like many traders took a half day. I also didn't like how it wasn't moving in conjunction with USO. It's a bit tricky right now trying to buy support and sell resistance since the levels in the indexes aren't clear yet. I was assuming that 6500 on the Dow would serve as psychological support to some degree. Fortunately we didn't close at the low of the day in the S&P: 666.

Setup: 75

Thursday trade - QQQQ

After my HNT trade this morning not following the market, I opted to trade the Qs this afternoon. I traded what looked like a perfect inverse H&S pattern that turned out to be a headfake. I don't usually trade these so if somebody can critique any problems with the pattern, I'm open to input. Looking back I shouldn't have been expecting much buying before tomorrow's jobs report, but I try to trust these technical patterns.

Setup: 70

Thursday trade - HNT

One of the most annoying trades is where you are right about market direction and timing but the stock you selected does not move with the market. I had one of those trades today and I think you can see what the missing ingredient was. The setup looked pretty good on 10 minute charts with a couple narrow range bars at the base of the open range but there was hardly any volume on the first bar. When a stock doesn't have unusual or at least normal volume it increases the likelihood that it will just drift and not follow the market.

Setup: 55

Wednesday trade - JOYG

I traded JOYG as an open range breakout. I liked the unusual volume (earnings) and the high base that met resistance at 18. I entered on a pullback to 18.05 after seeing the heavy volume on the breakout bar. It started to stall out so I moved my stop to breakeven. I wanted to see more volume come in and I didn't like how choppy the overall market was looking.

Setup: 65

Monday trade - HNT

This is my first day back making actual trades after paper trading some new ideas last month. Of course once I started developing a system for choppy, directionless markets--wouldn't you know it, the market started showing some direction and we had an unusually high number of trending days last month! But now I have another tool in my toolchest and I'm sure it will come in handy.

Starting out this morning it looked like we were in for a slow bleed down to 700. HNT looks like it's in freefall on the daily chart at least until it gets to support at 11. XLV was setting up an h pattern. I shorted HNT at 12.50 with my stop at 12.73. It was very slow to breakdown, but eventually accelerated. Half of me just wanted to cover when the S&P hit 700 but I couldn't ignore what looked like capitulation volume. This was a 1.95R trade. That could have been 4R with more patience but it's nice to start the month with a winner.

Setup:65