QQQQ Retracement

Q's are at the 61% retracement level from the recent high. We'll see if we can get pas that, and push on.

Potential Swing Trade

Buyers have come in at a higher low. AXL has been trading in a channel for the last couple of months. A good swing trade from 1.50 to just over 3.00 at prior resistance. I am long a small number of calls. We'll see how this trade plays out.

The market in general is acting very indecisive. 5% decline one day and 5% gain the day after, makes for a lot of chop. Defense and discipline.

End of the world not so close?

If the Q's can hold this level, and continue higher, we might be in for a good ride back up. Thinking of adding to my long position. I, however, remain cautious, but cautiously optimistic.

Support?

It appears that the Q's are holding support at the 61% level. This level is also indicative of a higher low on the daily chart, leaving the uptrend intact. Some good rallies this morning, let's see if this can hold up. Financials, however, are looking worse for the weather.

Looking for some buyers

I'm looking for buyers to return to the market, but earnings reports among other things has them spooked. As a result the market has taken a turn from its highs, and broken through some important levels, but as long as it doesn't make a lower high, it should be okay.

I am still holding my long position. I got caught in a gap lower, and did not want to liquidate. I have held on hoping things would turn around. So far, no go. However, if the Q's can hold above 28.80ish and make a turn higher, we might have a continuation of an uptrend on the daily time frame. From there I will look into expanding my long position.

FLEX Breakout?

I am looking for a breakout of FLEX as it chugs upwards. I have taken a small long position with April out of the money calls. Time is on my side and FLEX is wearing away at resistance.

QQQQ (Daily Chart)

There is a trend on the 30 minute time frame, but weakness in the short term. Sellers are in control. Looking to establish a higher low to continue the trend.

QQQQ (1 Minute Time Frame)

Trading range narrowing. Looking for a breakout? We'll see where and with what kind of volume.

ALD Play

Yesterday I closed my long call position on ALD. The stock had broke out above resistance, and I purchased February calls one strike out of the money, hoping that momentum would continue within the next two weeks.

The stock showed good strength and volume on buying, the first day, but it was the second day burst that brought the stock up. It started showing weakness, or at least sideways movement when it failed to make a higher high after the break out. So rather than sitting on this, I decided to take profits.

In a period of about 24 hours, my calls made a gain of 266%. An excellent way to begin the first full trading week of the year.

Market Open

The Nasdaq 100 is opening with a gap higher near yesterday's highs. If it can maintain strength early on, the Q's have a good chance to make some more gains during the day.

I am still watching some small cap stocks waiting for some breakouts.

I am also still long calls on the QQQQ and ALD.

New Trading Week

I started out the trading week a bit slow. My trigger finger missed Citi. I am going to wait to see what develops.

The Q's looked solid, with potential moves higher, so I bought a small long position with OTM Feb calls. I am looking for some small daily gains over the next few weeks.

Small cap stock ALD showed some strength and broke above some prior resistance, I also took a small long position with Feb calls.

Just going to continue to keep it slow, and maintain descipline.

Trading 2009

2008 was a brutal bear market, with volatility up the sky; the DOW traded its largest daily swings ever. Lehman Brother's collapsed, yet other major banks found bailouts. The list goes on.

Here on the first trading day of 2009, the NASDAQ 100 traded up very nicely. Looking at the daily chart, we see that not only did the Q's break above prior resistance at 30.50 (the 61% retracement point from the November highs), but it closed above the 10,20,50 SMA. We also have convergence of these averages, which is important. This indicates the end of the market decline and the beggining of accumulation, the long process of healing. This type of market is subject to a long period of sideways movement; very much a range bound market. Also we have our first "long" signal from the DMI indicator. The crossing of the of the DM+ and DM-, as well as the ADX above 20 (though it is declining). I am not acting on this long signal, but it is the first real signal since August/September '08.

These are some promising signs that the world is not over and we will live to trade another day.

I started the trading year by closing out and posting profits from my short position I took on Citi. The stock has taken a beating, but has found good support. Come next week, I will most likely open another short put and let theta decay away.

Also, I have several stocks on my watch list that have also taken a beating, but have good potential for a fast rally this month. If these can show strength and break out, I'll take some small long positions with out/at the money calls.

2009 is all about managing risk and using what the market hands me to my advantage.