Tuesday, January 27, 2009

Choppy Trading

We seem to be headed towards another good day in the market, but we all know how that can change during the course of the day. I feel as though we are in a kind of lateral bias with no strong trend up or down in the overall picture, but there are some really good opportunities out there as evidenced by some of the recent picks generated.

Two of the stronger ones that I would recommend would be CAT and ROH which are trading in pre-market close to two percent higher than yesterday's closing prices. Personally I would favor either, but I would wait until the early morning run up on these to see where it settles. After a large sell-off there is sometimes a continuation that goes into the next trading day, so be patient and enter around the noon time lull if you are so inclined.

Make sure you have a good stop in place. I would recommend a five percent stop, but set it where you feel comfortable. If I see some steady progression after the morning rush, I may enter with a five percent trailing stop to keep profits locked in as the day goes on.

Have a good one,


  1. Good call on ROH being down at noon. I was wondering what do you use as an exit point? Thanks, JR

  2. @JR
    Thanks. I'll use The SA sell signal, or my own judgment based on techical analysis such as a %K reaching above 70 if the equity has upward momentum.