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Trading Plan Charts for Monday Feb 22-Trades Hitting New Highs-End of the Rally?

Trading Plan for Monday Feb 22

MARKET DIRECTION

The market shook off the fed raising of the discount rate and charged higher on Friday. One thing to remember is Friday was options expiration which can cause irregular moves that aren’t real and with volume. Bottom line this action was quite bullish but we are still near nosebleed levels when it comes to what the market does in the short term. Will the overall bullish trend pick up where it left off after this last correction? We don’t know, but what we do know is the market is due for a pullback in the next couple days.

Reasons why:
#1 6 up days in a row on the NASDAQ is one simple way to measure this. Historically the market doesn’t go up more than this without a pullback.
#2 Another more systematic way to measure this is by looking at some RSI readings. The settings we use for the RSI tells us we at a very low probability time for initiating new positions.

Of course overbought and oversold can get more overbought and more oversold but you have to trade when the odds are in your favor. If you are trying to initiate new positions at this point when odds favor a pullback in the near future then you are trading exactly wrong.


S&P 500

NASDAQ

OPEN POSITIONS


WBMD new high.

Watch ULTA. We would look to close if trades any lower

HUN hitting new highs

VRX could make another move

VIT bending lower. Still up over 10% but we would  SELL

EPB Would close position. Stock is hitting resistance and is running out of steam on this run

GOOG up but jury is out

ASIA trade was up as much as 4.4%. Any remaining position was stopped out on Friday at breakeven

ATNI-Stopped out on ATNI at breakeven. Trade was up as much as 3.4%

ORN is up but stalling. We would close out position. Still up over 4%

NEW SETUPS
Our screens found no high probability setups ready to make extended moves. We only found overbought stocks and broken stocks bouncing into resistance. Both setups can get you burned badly so be patient like us and wait for the next pullback

Thanks

Better Stock Entries

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Disclosure: no positions
Stocks: VRX, VIT, EPB, WBMD, ULTA, HUN, GOOG, ASIA, ATNI, ORN