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ShadowTraderPro Swing Trader for April 23, 2010
The ShadowTraderPro Swing Trader is your every
morning dose of market reality brought to you from the resident geniuses
at ShadowTrader. Overseen by Chief Equity Strategist, Peter Reznicek, each
issue contains a full report on the prior day's action, including market
internals, technicals, and what sectors were hot and cold. Each issue also
includes the ShadowTraderPro Model Portfolio, which updates members on
what stock plays STPro is currently engaged in officially, as well as
provide a daily list of long and short setups for more self-directed
traders and investors. To get the most out of your subscription, please read our Swing Trader User's Guide If you have any questions or comments regarding commentary or plays in this newsletter, please email to swingtrader@shadowtrader.net. The Big PictureGood morning, traders. Resilient. That is the one word that comes to mind when thinking about the broader stock market today. Any bears that poked their heads out of their winter dens this spring must have ducked back inside and hit the snooze button which still hasn't gone off. The NYSE AD Line ($ADVN-$DECN) moved from -2000 at 9:35am yesterday to close up at the +1000 level. And it was done on a day when volume was very healthy. NASDAQ internals also moved up from very bearish readings early to close well above the lows of the day. Whatever the reason is not our concern. What we recognize is that the market is signaling that it isn't quite done moving higher. However, the thing not to do now is to get carried away on the long side or play the game of trying to prove your genius with bold calls backed up with oversized trades. As we have said over the past week, let the others battle it out at overhead resistance while giving the majority of your army of dollars some rest. The good news for ShadowTraders right now is that we have a bunch of cash on the sidelines to get long after more upside potential appears. If the market falters, then we will be ready on the short side also. One sector that may offer a long opportunity for nimble subscribers is the Dow Jones U.S. Coal Index ($DJUSCL). Let's view it's daily chart below.  The $DJUSCL had a strong showing yesterday moving off it's lows to close as a reversal bar yesterday. We also like the recent touch of the ascending trendline which also is serving as he second low of a double bottom (orange circles). Notice however that upside in coal names could be limited to the point where the $DJUSCL either reaches prior highs (red oval) or the descending magenta trendline. If you decide to trade any of the names in the sector, be sure to monitor the index throughout the duration of the trade. It may provide an early indication of when to exit an individual name. Drilling down into the coal sector (pun intended), one stock that has already released their quarterly earnings and has a similar setup to the $DJUSCL is Peabody Energy (BTU). Alpha Natural Resources (ANR) has earnings far enough into the future (05/05/10) where it is still playable. This stock was listed in the Bulls and Bears section of this past Monday's ShadowTraderPro Swing Trader. Another way to play the sector without necessarily having to time an earnings release is through the Market Vectors Coal ETF (KOL). As for the ShadowTraderPro Model Portfolio we are playing things close to the vest just as we are encouraging subscribers to do. Verifone Holdings, Inc. (PAY) is currently our lone holding. We took a long position in the stock on Tuesday. Yesterday the stock shot up over 4.5%. We will be looking for follow through today with a current target on set at 23.55. Depending on price action on the broader market, we may look to add one more position so please be alert to your inbox for ShadowTrader Swing Advisories. Under The Hood
Heads UpToday - 04/23/2010 Monday - 04/26/2010 Tuesday - 04/27/2010 Bulls and BearsLong Ideas
ShadowTrader Model PortfolioTo get the most out of your subscription and for detailed instructions on how to structure your own portfolio, read our Swing Trader User's Guide
Click here for year to date Model Portfolio Performance - 2010 Click here for Model Portfolio Performance - 2009 Click here for Model Portfolio Performance - 2008 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
