TTP Trading has one of the most unique trading services available today as members have access to not one, but two traders, CJ Agresta of Trust The Process Trading and Greg Krupinski of GK Trading. Both traders use a similar methodology as swing to position traders as they look to capture shorter term swing gains with a portion of their trades while trying to capture longer trend following gains on the balance of their positions. TTP Trading has one of the most comprehensive services available as well. Aside from receiving real-time stock alerts, members receive thorough reviews each evening of the action in the major indices and detailed reviews of each open position. Additionally, members also receive a comprehensive weekend letter that includes a detailed chart review of the major indices in preparation for the coming week. Members also receive a 15-20 minute chart video each weekend highlighting new potential trading opportunities as well as a Morning Note laying out the Trading Plan for the day that includes any possible actionable trade ideas we are looking at. Greg runs a hypothetical $50,000 trading portfolio for intermediate to advanced traders looking to be more active while using strictly technical analysis to find trades, while CJ runs a smaller $25,000 hypothetical portfolio for beginner to advanced traders, primarily using CANSLIM trading principles. Follow each trader separately, or use the information in tandem as each trader uses a very similar money management approach. Go to http://www.ttptrading.com now to receive a 30 day free trial membership. See you there!
LHCG- Medical Care provider LHC Group formed a relatively loose cup and handle pattern in the late fall, and subsequently broke out, but that attempt quickly failed returning the stock back into the previous base. It has immediately formed a second cup pattern and is working its way up the right side of that base pattern. The company has posted three straight quarters of accelerating earnings growth, and has also posted sales growth of 95% and 88% over the past two quarters. The stock has a composite IBD rating of 99 which is ranked 1st in its industry group, Medical/Outpatient Home Care. Its high relative strength of 97 is also approaching new high ground, a bullish sign. Add this stock back to your long watchlist.
MARKET GAUGE- Confirmed Uptrend
OVERVIEW- Momentum continued off of last Fridays confirmed follow thru this week led by the Small Cap Russell 2000 which added nearly 4.75%. However, the possible areas of resistance on all the indices that we discussed last week have quickly come into play. As usual, the market landscape is painted in varying shades of gray. Last weeks follow thru day, which was our signal to start looking to some market leaders for some possible long exposure, is now met with several technical challenges. Furthermore, immediately upon last weeks follow thru, few leading stocks were breaking out of well formed bases indicating that there is still some work to be done before any new uptrend can sprout serious legs. As the week wore on, a few more opportunities were appearing leaving us with a slightly more positive tone heading into next week, however, some caution is still warranted. Despite the newly confirmed uptrend signal, we must at least consider that this currently rally may be a sharp retracement in a bear market, so any new long exposure taken based on our signal should be taken slowly and with lowered than normal risk. If we are indeed in the early stages of a new lasting bull leg, many more opportunities will present themselves as we move forward. As we point out in the chart reviews below, the indices are all approaching some obvious areas of resistance, unfortunately what seems obvious in the markets can often be dangerous. I believe it was Linda Bradford-Raschke that stated “markets will often do the most obvious thing in the most unobvious way.” In other words, markets will often frustrate the majority of traders and inflict as much pain as possible before they move in their intended direction. So what do we do? We continue our process of monitoring the indices daily looking for clues as to whether institutional traders are accumulating or distributing stock, but in doing so we can not get so fixated on daily index action that we are not paying attention to what individual leading stocks are telling us as they, along with the stocks in our portfolio, are always the ultimate barometer for our trading. Now, let’s take a run thru the charts where we will see that there have been no distribution days tallied since our confirmed uptrend began on 1/4, which is a positive as we head into trading next week.
That’s all for today. We will be back tomorrow with our complete Weekend Trading Review for our premium members. Sign up for a free trial today at http://www.ttptrading.com See you there!
Emotional trading leads to bias trading, and bias trading leads to an eventual destruction of your trading account. Trust me, I learned the hard way. After trading extremely well part time for many years, I decided to turn things up a bit in 2007 by trading full time and had a pretty good year returning about 41% on my portfolio. In 2008 we had a new president and as the year progressed I become worried that the new administration would wreak havoc on the markets with some new policy initiatives and I steadily built a very bearish bias. Rather than execute my game plan, listen to what the index action was telling me on a daily basis and letting the price action, especially that of leading stocks dictate my trading, I saw a short set ups in most every pattern that came across my screen, and while I profited for a while on the short side, my bias toward a sinking economy under the new administration at that time, left me ill prepared for the possibility of a huge turn in the markets. Well if you are any kind of student of the markets, or at least conscious, you may not have to guess as to what happened to my performance. The market bottomed in early 2009 and rallied around 80% through the end of 2010, not a good time to be on the sidelines, or firing off a whole lot of short trades.
The year 2019 brings us yet more political noise and I advise you to stop trying to guess what effects this will have on the markets. Those who had a bearish opinion as a result of the Trump victory in late 2016 felt the pain of being on the wrong side of the market. What will the political winds bring us in 2019? No one really knows, and if you come across someone who insist he does, run away quickly! Stick to your methodology and execute your trading plan. Pay attention to the major indices on a daily and weekly basis, and most importantly, focus your attention on market leading stocks and sectors and listen to what they are telling you always bringing with you a clear and open mind to the markets everyday, and dare I say, Trust The Process!
Large cap Biotech tech stocks are in the midst of trying to recover from a nearly 30% decline after topping out in early October of 2018. A Fibonacci retracement grid shows that the large cap biotech ETF, IBB, has recouped over half of those losses with its recent, sharp rally. Rallies can often stall and reverse at key Fibonacci levels between 61.8% and 78.6% so the group may still be vulnerable. However, action in the individual stocks should always be your leading indicator and several large, as well as small cap stocks in the group, have been acting better recently. Add $VRTX to your watchlist of solid earners setting up potentially solid base formations.
Premium members were alerted to two new long trades today. Growth stock candidates QuinStreet (QNST) and AudioCodes (AUDC) both sport high relative strength ratings of 98 and have posted several quarters of robust earnings and sales growth. Both stocks are ranked #1 within their respective industry groups based on IBD composite ratings. If you would like to learn more and trade using the CANSLIM methodology join us at http://www.ttptrading.com today. A free 30 trial is waiting. See you there!
OVERVIEW– With a new rally confirmation in hand for the indices registered on Friday, we look to some of the stronger stocks that we have been keeping an eye on during the most recent downturn for possible new long trades. However, the list of leading stocks that are set to break out of proper, solid base formations have been thin, and many have wide and loose formations that lead to a higher than normal breakout failure rate, so conditions are by no means perfect right now. Confirmed uptrend or not, traders still need to trade with caution and move slowly, if at all, into new long positions, preferably with lower than their normal risk. Here is a detailed look at one of our top stocks from this weeks watch list, along with its current EPS and RS rankings from Investors.com and IBD.
TEAM- EPS 97, RS 97
Perhaps the most solid technical set ups we see today belongs to Atlassian Corp. The stock belongs to the Software/Spec Enterprise group, one of the few growth industry groups sitting near the top of the leading industry group list according to Investor Business Daily, ranking 26th out of the 197 groups monitored. After peaking at $98.21 on October 1st, the stock has since carved out a third stage base cup and handle pattern, and at a closing price on Friday of $87.09 sits 3% below the pivot point of that base at $89.82. While some further volatility contraction would be ideal before any breakout, the stock is worth consideration for a long trade on a move above the pivot point on an notable increase in trading volume, preferably 2,000,000 shares, or better as long as the general market conditions are supportive. Remember to never initiate a new trade more than 5% above the stocks pivot point, and preferably much lower. Other stocks that we alerted to members this week include DATA, TWLO, CIEN and QNST. To get analysis on these stocks and much, much more, join us for a free trial today at http://www.ttptrading.com See you there!
MARKET GAUGE- Newly Confirmed Uptrend
OVERVIEW- Market indices staged a huge rally on Friday and in the process registered a confirmation on day seven of the initial rally attempt on 12/26, thus signaling a new uptrend. The large gains posted by the Nasdaq and S&P 500, coupled with an increase in trading volume over Thursdays session in the S&P, technically gave us our confirmation day. However, before traders hit the ground running with new long positions, we must note that not all newly confirmed rallies succeed. Most recently, the two new rallies that were confirmed in November both failed quickly as indices went on to register new lows. Additionally, the indices have much more work to do repair the technical damage that was done during the latest correction. The first thing we would like to see on a technical basis is the indices remount their 50 day moving averages. As I have stated many times, bull markets live above their 50 day moving averages and bear market toil below them. Additionally, we need to see more growth oriented stocks breaking out of sound basing patterns and to this point we have little evidence of this. There are some small areas of strength in this department however, particularly in the software group where a few select stocks have been forming decent bases. In short, we need to see some new industry leading groups emerge and some leading stocks within these groups start to fire higher out of sound basing patterns to give this new uptrend a chance of lasting success. Of course, we don’t know if the third time is a charm for this latest uptrend confirmation, or how long lived its success may be, but we will monitor the indices now for signs of distribution to help us gauge the recovery. In the meantime, some caution is still warranted and traders should venture back in to the markets on the long side very slowly, with lowered position risk focusing particularly on stocks that have held up the best thru this correction and ideally are part of a leading industry group, or the groups that are starting to make their way up the list very quickly. Bear markets can spawn sharp rallies that lure eager traders in too quickly causing numerous whipsaws that eat at their account values, so patience is still required before getting too heavily involved on the long side. The possibility exists that this new uptrend unfolds slowly as the indices mend the previous damage caused by the prior sell-off, or perhaps we will see another failed uptrend, but whatever the outcome continue to build your watchlist focused on high relative strength stocks that show superior sales and earnings growth while keeping a keen eye on the particular industry groups that show the strongest strength. With that let’s take a look at the four indices we cover here as we head into the first full trading week of 2019.
That’s all for today. I will be back tomorrow with our Weekend Trading Review for our premium members at our premium site. Join us for a free trial at http://www.ttptrading.com See you there!
Friday was day seven of a new attempted rally that began on 12/26, and today that rally was confirmed with large gains posted across the board on all major indices. It was a close call as NASDAQ volume looks like it will fall short of yesterdays levels, but the NYSE volume showed an increase which is enough to signal a confirmed rally and a new uptrend. But before you go on a stock buying binge, know that confirmed rallies can, and do fail. The two most recent confirmed rallies that took place in November both failed quickly with the indices ultimately going on to mark new lows. Additionally, there is an absence of high quality growth stocks breaking out of well formed bases, so the markets may need more time to heal before any new uptrend gets going in earnest. Despite the new signal, capital preservation and patience is still key in this volatile market, so limit any new buys to leading companies in leading industry groups and dip your toe into the waters slowly until the markets prove themselves further. Check in here tomorrow afternoon for this weekends full Weekly Market Prep analysis for next week.