Wednesday, May 27, 2015

Investing: Looking Back To Get Ahead

This month we've examined the importance of monitoring positions and back testing your investment system.  As a part of this I gave you a beak down of one of my recent winners as well as one of my recent losers.

Investing: Looking Back To Get Ahead


Looking Back To Get Ahead

In this post I'm going to put it all together for you by giving some insight on all of the stocks I've highlighted over the past 4 weeks.  We'll look at the winners to see why they won and to find ways of identifying similar stocks in the future.  We'll also look at the losers to see why they lost and how you can avoid others like them in the future.




Let's Start With The Winners
  • VRX (5/4) and REGN (5/11)
    • Why they Won: Both of these stocks were winners for the same reason - they maintained momentum!
    • How To identify similar opportunities in the future: VRX and REGN both traded at or above their 8 day EMA which is a clear indicator of momentum.  This is something to watch for when charting a growth stock.
  • ANTM (5/18)
    • Why It Won: When reviewing the chart I see that this stock crossed its resistance lines on the 15th while the stock was moving in an upward channel.
    • How To identify similar opportunities in the future: ANTM had 4 days of sideways movement on the 50 day EMA, but it never dipped below that.  After those 4 days, it broke out with massive volume - over 300%!
  • MLM (5/18)
    • Why It Won: This one broke out from the 50 day line for 2 days in a row with massive volume.  That gave this stock the shot in the arm it needed to hit profit.  
    • How To identify similar opportunities in the futureWhen compared with its parent sector ETF, this stock had all of the positives of the sector, but didn't experience the negatives.  It moved sideways instead of dropping below the 50 day line which is a clear sign that this was a true growth stock.  

If you have trouble putting together a solid watch list (or if you just don't have the time to do it), I offer access to my weekly watch list for just $4.99 which you can sign up for below:


Looking Back At The Losers
  • ULTA (4/26)
    • Why It Lost: Quite simply, the sector tanked right as this stock was poised to break out.  ULTA still outperformed its ETF so it was worth keeping on the watch list.
    • How To Avoid This: Pay very close attention to sector strength to avoid getting getting into a stock at the wrong time.
  • XLE (5/4)
    • Why It Lost: Macroeconomic pressure was a major factor here.  Unfortunately, this is a common variable with this sector.
    • How To Avoid This: Given the volatility of this sector, it's best to take a smaller position, or, utilize an options trade to limit risk.

    The Undecideds
    • ORLY (4/26) and USO (5/11)
      • Why They Haven't Tipped The Scale: These stocks have moved sideways but they're still within my allotted 40 session time frame to demonstrate a win or a loss.  
      • Remember to plan for 3 exits with every trade; an exit for profit, an exit for stop loss, an exit for timing.
    If you struggle with pre-planning your entries and exits, I also offer a weekly trade plan service for $9.99:



    Have you ever wondered what type of investor you are?  In June I'm going to talk about the differences with the 3 most common trading persona's.  To kick off this discussion I'm going to be sending out a survey and we'll break down the results here on the blog! 

    Happy Trading!




    Tuesday, May 26, 2015

    My Weekly Watch List: $CI $UTHR $HZNP $DXJ

    What History Can Teach Us
    The SPY is +2% so far this month and we still have 4 more sessions left on the calendar.  Surprisingly, May 2014 showed similar performance. Historically over the last 50 years, the month of May barely hits +0.16%. Looking over the charts this weekend, I pinpointed an interesting behavior.  The last time the market traded in a very tight range for 2 weeks in a row with low volume was in late February.  Not long after, it rolled over into a mild correction of -3%. This time around, the market has traded in a very tight range for the last 6 sessions in low volume as well so I'm keeping a close eye on things this week.

    Are Institutions On Board?
    Most people like to check out early ahead of the long Memorial Day weekend and senior traders are no different. Volume on all 3 major indexes - $SPY, $QQQ, $DJX - was considerably lower last week compared to the prior week. The market hovered around the major resistance lines last week as well. Institutions have been piling money into growth stocks that trade less than $100 Million daily for the last 4 weeks, which concerns me. This does concern me because thin stocks are usually a no-np for them. 


    A Peek At My Watch List

    Recently, the health care sector (XLV) has shown some strength. That is the sector I have been looking for growth stocks this week.  Here are 3 stocks that made it through my filters.  
    $CI
    $HZNP
    $UTHR

    Japan’s market has performed over 18% year to date, so if you're into ETF's, it's worth looking closer. One of the ETF's that I'm looking at is:

    $DXJ

    That's a Wrap!
     

    This is a rough time of year if you're involved in markets and/or if you leave in a Hurricane zone like me!  I often look at options strategies to lower my risks even further. I also take a smaller position than usual at times like this. This week I would like to see some volume with my positions. That's my confirmation that institutions are behind my picks.

    Happy Trading!

    Friday, May 22, 2015

    Janet Yellen, Millennials, and Winning From Losers

    What I Noticed This Week

    The markets seemed to have trouble deciding which way they wanted to trend this week.  With the holiday weekend approaching, it's no surprise that volume has been lack luster.  Nobody wants to risk added exposure at a time like this!

    That being said, there were still some opportunities this week.  Some members from my local Meetup discussed how they were able to make a profit on one particular stock.  Many used IBD® data to identify this as a quality stock but it's interesting to see how they tweaked their approach to fit their own trading style - myself included!

    Does Janet Yellen Understand What Drives The Economy?


    Janet Yellen, Millennials, and Winning From Losers
    Last week I highlighted that I recently started following Ben Bernanke's new blog at the Brookings Institute.  I make sure to collect points of view that differ from my own in order to give myself the best chance at understanding market behavior.

    Earlier today, I came across this article from Chris Matthews that discusses James Montier's view that both Bernanke and Yellen still leave something to be desired in terms of understanding how the economy works.

    For me, it's important to give equal weight to both opinions because I don't want my analysis of future data to carry bias if possible.  I've always found that when I make predictions based on data, I have more success.  When I make decisions on what I feel, I get myself into trouble.  Exposing myself to both points of view on this matter really helps to keep me honest during my own analysis.

    An Interesting Take On Millennials


    Millennials are coming into their own in terms of their contribution to our economy.  Just a few weeks ago I highlighted that Whole Foods is courting Millennials as a part of their long term business model.

    Recently I've been paying attention to any Millennial-centric news and I came across a thought provoking Wall Street Journal video from Douglas Boneparth (a Millennial himself) who just so happens to my son's CFP.  Definitely worth watching, no matter what generation you identify with.




    Winning From Losers

    In a guest blog post yesterday, I offered up some ways that you can still come out a winner on a losing trade.  I kept it short and sweet so have a look!


    Keep in mind that US markets are closed on Memorial Day so my watch list and trade plans will be going out on Tuesday morning.  If you haven't already, you can sign up for those services below:





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    Enjoy the holiday and as always, Happy Trading!

    Wednesday, May 20, 2015

    What I Learned From Losing Money on $AVGO

    Last week I continued with another post in my series on the importance of monitoring positions.  In this installment, I'm going to break down a recent loser for me and show you what I learned from losing money on $AVGO.

    The Backstory

    In the past, I've discussed my strict criteria for stock selection and $AVGO actually made it through my gauntlet of must-haves.  This stock was a great candidate in my opinion, especially because it:

    • Was in a defined uptrend channel after the market correction in October 2014
    • Earnings were already out of the way
    • The stock had moved into its buy point zone
    • The market was in a confirmed uptrend  

    So I put together a trade plan with a 6.7% profit target and a 3.33% loss thresh hold and then I pulled the trigger on am option trade in early March of 2015.

    Why It Went Against Me

    Even the best stocks still have risk associated with them.  In this instance, the stock wasn't actually the problem, though.  In late March, institutions started a massive sell off with a number of their holdings.  As a result, the market moved back to uptrend under pressure within just 3 sessions!

    I was stopped out at my 3.33% loss thresh hold and thankfully so.  The stock continued its fall that day and ended down 6% by the market close.  What's more, $AVGO went right off the cliff after that and eventually moved down 16% so obviously I made the right call with planning my stop loss in advance of taking the position.

    What I Learned From Losing Money on $AVGO

    I honestly believe that you can learn more from a loss than you can from a win so I have incorporated a sort of "post mortem" phase with every trade, regardless of the outcome.  When I sat down to document my findings on this trade, here is what became clear to me:

    • My ability to select strong growth stocks wasn't the issue here
    • Fundamentals on this stock were not a contributing factor of the loss
    • Institutional behavior dominated the outcome of this trade
    • Preserving my capital allowed me to re-invest in $SWKS on a 2nd breakout opportunity

    In Conclusion

    Any time you lose, it's easy to start second guessing your methods but you have to fight that urge and think objectively.  Tweaking your system is a time intensive endeavor so you don't want to pursue that unless it's necessary!  It's critical to back test and let the data drive your decision making process.  

    If you think you might need help with documenting your methods or with creating trade journals, please reach out to me at investorspotlight@gmail.com.

    Happy Trading!






    Monday, May 18, 2015

    $ANTM $MLM & $REGN: A Wrestle For The Market

    Bulls and Bears Wrestle For The Market 
    I'm not sold on the commitment of institutions to the market right now.  For the past 3 months $SPY, $QQQ, and $DJX have been trading in a very narrow 2% range. It appears that bulls and bears are stuck in a wrestle for the market with no clear winner yet. For me, this is unsettling because institutional behavior gives me the signs I need to predict momentum.  Right now they are holding their cards close to their chest so finding quality growth stocks has become more difficult than usual.

    Breaking Down Market Conditions
    According to IBD, we've got a “Market in Confirmed Uptrend” as of Thursday May 14th.  The last two times we had a confirmed uptrend, the market went back to “Market under Pressure” within a few days. What's more, all three major US indexes closed at the same spot on both Thursday and Friday.
    Volume on Friday should have been higher since it was the last day for May regular Options Expiration. Instead, Friday ended with lower volume than Thursday!  That's a red flag for me so I'm looking cautiously at the stocks on my watch list this week. None of my watch list stocks this week managed to meet all of my personal criteria for an ideal watch list candidate. That is a clear indication to me that the market is still not quite ideal for entering a position in an IBD style growth stock.

    Here are 3 stocks that made my list this week.  Have a look at them for yourself and you'll see what I mean:

    $ANTM
    $MLM
    $REGN

    When possible, I prefer to get a clear confirmation of the intent of institutions.  Ideally, I would like the $SPY to trade above 213 and $QQQ to trade above 109.42.  Also, I'd prefer to see $DJX above 18,289. In addition, I'm looking for volume to be at least 15% higher for 2 days in a row on any of these indexes.  If I see this happen, I will sleep better at night because I'll know that the bulls have won the wrestling match.

    Happy Trading!

    Friday, May 15, 2015

    The Avon Hoax and The Market Rally


    The Avon Hoax 

    In an odd bit of news yesterday, it looks like Avon may have been the target of an attempted manipulation.  Needless to say, the SEC will be investigating this latest in a string of electronic scams.  Authorities have done a relatively good job of keeping these types of scams from affecting the broader market ever since the Flash Crash of 2010.  With the market on shaky ground, we can't afford to have another hiccup in the system!

    I would love to hear from any investors out there who have a position in Avon.  How are you handling the recent news?  Does it change your long term outlook on the company?

    Market Rally

    It looks like we may have turned a corner with yesterday's market rally.  Many of the IBD-centric traders I know have been holding their breath for this moment.  However, there are still some analysts who advise caution as evidenced in this video:



    For me, having the market back in a confirmed uptrend means it's time to consider taking positions again.  This weekend, I'll work on updating my watch list and cranking out trade plans for my best candidates!


    My Theme Seems To Be Resonating

    This week I expanded on my theme of monitoring positions here in my own blog as well as in my guest post on My Trading Buddy.  This talking point also spurred a really thought provoking discussion in my IBD Meetup on Tuesday night, especially when the conversation morphed into how lagging demand is still a concern for retail investors and institutions alike. 

    It's understood that the summer is traditionally a frustrating season for investors but that doesn't mean opportunities won't still pop up for you. Any successful trader should incorporate risk management through every element of their process so I hope my theme posts this month .  

    If you're like me, you moved into cash during this recent correction.  I'm keeping my head on a swivel going into the weekend so that if conditions are promising on Monday morning, I'm ready to pounce.  

    Happy Trading!


    Wednesday, May 13, 2015

    $SWKS: Managing Risk In a Weak Bull Market


    Last week I started a blog series on the importance of monitoring positions

    Today, I'm going to highlight what I see as weaknesses in the structure of the economy and why I see back testing as a critical component for managing risk in a weak bull market.



    I'll also break down one of my recent winning trades on $SWKS to show you why it was a winner and hopefully you can identify others like it in the future. 

    The Weak Bull Market

    One thing that has become really apparent to me is that we are in the midst of a weak bull market.  As a growth stock trader, I try to focus as much of my attention as possible on stocks that have true momentum and lead their respective packs.  In a strong bull market, new opportunities for growth and momentum spring up constantly.  However, in our current market, I'm seeing that all of the best opportunities have already been jumped on by institutions and in most cases they are maxed out.

    The biggest warning sign to me is that institutions are throwing their profits at thin stocks lately.  In some cases they're even getting behind stocks that trade less than $50M a day.  This is incredibly uncharacteristic behavior for them which just proves to me that the prime opportunities they're used to are exceedingly rare in the current market. They're hedging their risk by stashing their cash in stocks where they can control the price. 

    Economic PTSD?

    I have spent a lot of time trying to figure out why it is that "new" growth stock opportunities are not popping up at a quicker rate and I think it all boils down to a sort of economic PTSD.  What do I mean by that?  Well it seems to me that this ongoing issue of there being a lack of demand world wide has finally caught up to us.  Governments, monetary policy experts, financial institutions, and many other large interests, have been artificially propping up demand for the past seven years hoping that eventually the private sector (and consumers) would get their acts together and start demanding more products and services again. 

    Unfortunately, that just hasn't happened.  I'm not entirely sure what the reason is but it seems like consumers are still gun shy and waiting for the other shoe to drop.  Big corporations are sitting on heaps of cash due to uncertainties in the market that they have no control over.  We also have a noticeable shortage of leadership when it comes to any tangible pro growth initiatives that everyone can get behind.  We've also seen plummeting numbers in terms of the public's trust of large entities.  

    This artificial growth we have right now has been propped up for a very long time and it just can't hold up much longer.  I think that is the reason that the recovery has underperformed.  As a result, I think that's why new growth stock opportunities have been harder to find in recent months.  

    Learn From Your Winners

    Now that I've established how precarious things are, I think it's important to show an example of a winner within these troubled times.  A recent example of a winner for me would be $SWKS.  This stock gave me a profit 10% in January 2015, and another 10% in March 2015 when I got into it again.  The key with this stock for me was that I managed my risk by harvesting profits and re-deploying them on this same stock when it hit my watch list and the math was in my favor again.

    So let's look at why I won on this trade.  First of all, I watched this stock for a good 5 months before getting involved with it so I was able to document its momentum (institutional support) and set up some benchmarks for myself.  In addition:

    • The RS remained above 90 and it was the best performer among its peers
    • This sector showed strength the whole time I was in my trade
    • This group showed strength over the same time span
    • This stock was the strongest within its group

    And most importantly

    • When a recent market correction hit, this stock withstood that correction.

    When I apply my back testing to $SWKS it's clear to me that my system of using strict must have criteria worked to my advantage.  With that said, I'm going to continue using the successful elements of my system and try to improve them over time.

    Hopefully my insights on the weak bull market demonstrates why it's so important to manage your risk.  At times like this when things get choppy, it's critically important to preserve your capital  

    Next week we'll take a closer look at a trade that went against me with a focus on why things turned out that way.  


    As always, keep me posted with your questions and comments.

    Happy trading!

    Amin

    Monday, May 11, 2015

    $REGN and $USO - A Low Risk Approach

    A Low Risk Approach


    My analysis of the 9 US sectors, as well as European and Asian ETF’s revealed that most of the market activity is taking place overseas. Some of the European markets - Britain, France and Germany in particular - are up almost 10% YTD. Asian markets - Japan, Hong Kong and mainland China specifically - are up almost 15%. In the US, foreign institutions are actively participating in the Energy ($XLE) and Materials ($XLB) sectors.

    How About Market Health?

    The current market outlook according to IBD® is “Market in Correction”. These are not the ideal conditions for entering into any stock position. These are the times when it makes more sense to raise cash in your trading account. If you have a stock that is not performing according to your trade plan, you must stay disciplined and close out the position. It's best to stay in cash until market conditions improve. Most importantly, have a stock ready on your watch list and craft a detailed trade plan that you can pull the trigger on when market health improves.  

    I have just one stock and one ETF that have made it on to my list this week:

    $REGN (Stock)
    $USO  (ETF)

    I am taking a very low risk approach as we head into some of the worst performing months of the year. I prefer to see $SPY punch through a major ceiling of 213 and $QQQ punching through 109.42  It's best if these resistance lines are punched through in high volume for at least 2 days in a row. That will provide me with a confirmation and a comfort level that institutions are solidly with the market.  

    Happy trading!

    Friday, May 8, 2015

    Only Have 10 Minutes? Read This Post!


    Only Have 10 Minutes? Read This Post!


    It's been another busy week for me but I managed to carve out some time to keep up with current events.  I'm paying particular attention to what's happening with the UK election.  The results there could potentially impact the strength of the Eurozone and with Greece still threatening to default you can bet that a shakeup in the UK will have wide ranging effects on an already tenuous situation.

    Whole Foods Courting Millennials

    Earlier this week Whole Foods announced big plans following their disappointing Q2 numbers.  On the surface, it would seem that they recognize millennials as their future demographic but I think there may be more to it.  Reading between the lines, millennials don't have the income to support such an overhaul for a pricey chain like Whole Foods.  I think this may actually be a veiled attempt to lower their prices and reduce overhead by replicating the recent success of Walmart and Target in opening smaller locations.

    This topic spurred a great conversation on Twitter between myself and Alex Pitti who writes an interesting blog with some contrarian market views.  I had a chance to read through his most recent posts and it's definitely thought provoking so give it a read if you're interested in a different perspective.  

    Monitor Your Positions

    My theme for the month of May revolves around the importance of monitoring positions to test your trading system.  As a part of this effort I published a new guest post for My Trading Buddy which you can read here.  If you haven't already, make sure to subscribe to their free blog and newsletter for top notch content!

    A Free Trade Plan For My Subscribers

    Just recently I started offering a trade plan service and so far it has been very popular. To thank everyone for their support I've decided to give out another free trade plan on Monday.  To receive the trade plan you just need to be subscribed to my free newsletter which you can sign up for below:

    Subscribe to my FREE newsletter

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    Have a great weekend and Happy Trading!
      

    Wednesday, May 6, 2015

    Do You Value Your Time?

    In March I discussed the importance of planning a trade which was quite well received.  In April I discussed my method of "addition by subtraction" for watch list building which ultimately led to this post where I provided a real world example based on $CLDN.  In May, I'm going to show you how and why I monitor positions.

    Value Your Time

    Like most others, you probably track a trade in order to keep tabs on the daily ups and downs, however, that's not the best use of your time.  I don't know about you, but I like to have a life outside of my trades, and that means keeping my time management in order.

    Without a clear goal it's easy to get off track so that's where it has to start.  In my case, I automate my profit, loss, and timing exit so I don't monitor a position for clues on when to get out.  Instead, I monitor positions for the sake of testing my system.

    Changing my mindset from tracking positions for reactive reasons to tracking positions for learning purposes took a bit of work on my part but I'm glad I stuck with it!

    Automate!

    If you're going to change your mindset the way I did, you'll have to learn to automate the way I did as well.  There are a number of reasons I include automation in my process but mainly I do it to remove my emotions from a trade.  In addition, automation frees up cycles for me and discourages me from getting tunnel vision on one particular position.

    Automating is actually a pretty easy affair and I do it for every exit condition in my framework.
    1. Profit: Every time I place an order I include a contingency to close my position if my pre determined profit target is achieved.
    2. Loss:  After including my profit contingency I enter in my pre determined loss contingency.
    3. Timing: Sometimes a stock plots a sideways course so I also include a contingency to close out the position before the end of 40 trading sessions.
    In all 3 scenarios, the planning and math have been done before I get involved on the trade.  Automation can only work properly if you create your rules up front and if you stick to them.

    Keep A Trade Journal

    The most successful traders keep detailed trade journals for every position they take, win or lose and you should follow suit if you aren't already.  Think of this as the post mortem stage of the process.  You need to know what to do more of, and what to avoid moving forward.

    It's also important to stay organized by keeping your journals in one place.  In the past, that meant putting notebooks into my filing cabinet.  These days I'm able to store everything in the cloud which is much more convenient.  Services like Google Drive, DropBox, and iCloud are all available either free or at a low cost and are definitely worth consideration for your investing tool kit.

    When it comes to documenting a winning trade, make sure you can identify why it was a winner and how you can identify others like it in the future. 

    A Winner

    A recent example of a winner for me would be $SWKS.  This stock gave me a profit of 10%  within 10 days in late January 2015. Looking over my journal, I noticed that the stock was in a definite defined uptrend channel ever since market correction in mid October of 2014.  It was good that I kept a detailed journal because once again this stock came through my watch list filter in early March 2015. I hit another 10% profit target in 18 days this time. 

    In terms of documenting a loss, it's important to understand when and where things went wrong.  If it's something in your control, look for ways to eliminate the barrier moving forward.  If it's because of something out of your power (bad press, a national tragedy etc), that information is important too.

    A Loser

    A recent example of a loss for me would be $AVGO where I lost 3.33% in late March 2015.  There was nothing fundamentally wrong with the stock as it passed through all of my watch list criteria.  The reason it turned against me is because institutions began to be major sellers market wide on all stocks just 3 sessions into my position. I was stopped out for a loss within 3 days but I conserved my capital. The stock ended up dipping down 16% so the stop loss saved me from disaster. 

    What's Next

    Next week I'm going to highlight what I see as weaknesses in the structure of the current Bull Market and why I see back testing as a critical component for managing risk.  As always, keep me posted with your questions and comments.

    Happy trading!

    Amin


    Monday, May 4, 2015

    $VRX and $ORLY - Opportunities on the Horizon

    A Turbulent Market

    Just when you think the market is resuming its uptrend, someone gets spooked and the trend reverses. Starting on January 1st of this year, IBD® has called “Market in Confirmed Uptrend” five times. It lasts for just a couple of days before the market retreats. This roller coaster is a sign of a tired bull market. Institutions are quick to dump a stock when they see any earnings, economic reports or any major world events not to their liking. For the Month of April, SPY was up a mere 0.98% but  QQQ was up 1.92%.  May is historically a month that performs very poorly (although that wasn't the case last year). This is why it's so important to utilize charts to get the story going forward.

    Clues From Institutions


    Institutions have been laying a very clear trail as to where they are deploying their cash. In my last 2 Monday posts, I mentioned that institutions are committing a lot of money to the lagging Energy (XLE) sector. The result of this action is that n the last 6 weeks, this sector has moved up more than 10%. 


    This earnings season has been brutal to some of the leading stocks in the Technology (XLK) and Health Care sector (XLV) and institutions have been pulling monies out of these past leading sectors into the Energy related sector. They have also deployed a lot of cash into other leading world markets such as Europe, Korea, China and Hong Kong.

    Opportunities on the Horizon


    When I build out my watch list by using my very strict criteria, I come with just a couple of names to look at. I don’t want to lower my standards just for the sake of getting a few more stocks on my watch list. The fact that just 2 names comes up on my watch list is a definite sign to me of a market that will trade sideways. We also have 12 distribution days and that is still too high for my trading style. With that in mind, I have lowered my expectations of profits even further down to just 8% for my selected stocks to perform in the next 8 weeks. Stocks on my radar are:

    $VRX
    $ORLY

    and one ETF to consider as well:

    $XLE

    I have developed a very strict trade plan for these names and the key is now to follow these plans very strictly. Getting a lower entry into position is highly advantageous to mitigate losses, should the market turn against you. Once again, I must emphasize that one should not chase the trade. Last week $ORLY was on my radar but I cautioned that quite often, these good stocks do retrace and give you a second opportunity to enter the trade. $ORLY just did that for us this week.

    Happy trading!


    Amin

    Friday, May 1, 2015

    $LL Struggles and $LNKD Tumbles


    Recapping The Week

    Catching up on the news this morning I came across this article from Andrea Riquier detailing some often over looked economic contributors.  The thing that jumped out at me was the prediction that improved household finances nationwide will help spur economic growth.  I really hope this pans out but I'm usually hesitant to act quickly on these types of predictions because consumer behavior can let you down.  

    When gas prices dipped in the U.S. several months ago, it was widely believed that consumers would spend that newfound cash elsewhere in the economy.  Instead, many people put that cash into their savings accounts.  Repairing the savings rate in this country is a good thing, however, it's not what the market expected and therein lies the danger of predicting consumer behavior.  

    $LL Struggles and
    $LNKD Tumbles

    Anyone that's invested in Lumber Liquidators recently has probably gotten stung a few times.  Now that Q1 earnings have been released, it's clear that the once thriving company is in store for more hard times.  In addition to a lack luster performance, the company is facing criminal charges from the DOJ.  It's hard to believe that one of the darlings of the 2013 stock market is now trading at basically the same price it did in April of 2012.  

    In contrast to Twitter, most analysts are still high on LinkedIn but their 20% tumble this week is causing a lot of jitters in the market.  Apparently, LinkedIn has seen a slow down in revenue from their recruiting products which is the reason for their stock price decline.  With the slow recovery it's no surprise that recruiting products are struggling to perform.  The good news is that there's a lot of agreement on LinkedIn's fundamentals and if/when there is a hiring boom again, they should be able to reap the benefits. 

    $ORLY Retraces

    Earlier this week I was high on $ORLY but I felt like it needed to retrace before action was warranted.  The good news is that it has, indeed, retraced to its buy point so it might be time for me to develop a trade plan for it.  As it happens, 40% of IBD® stocks retrace to their buy point so I was comfortable taking a deliberate approach on this one.

    With that said, if you're subscribed to my weekly trade plan service, keep your eyes peeled Monday morning to see if $ORLY made the cut!

    If you're not already subscribed, just click below!


    Premium Services

    A Free Gift To My Subscribers

    For anyone that subscribes to any of my premium services between now and Monday May 4th, I'll be giving away a free 1 hour Webinar for May 8th where I'll walk you through how I create trade plans for the stocks on my watch list.

    Keep the questions and comments rolling and as always, Happy Trading!

    Best,
    Amin


    DISCLAIMER



    Do not take a position unless you are prepared to sustain a TOTAL LOSS. Your loss could include the money you invested as well as commissions and transaction charges.


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    YOU SHOULD NOT MAKE ANY DECISION, FINANCIAL, INVESTMENTS, TRADING OR OTHERWISE, BASED ON ANY OF THE INFORMATION PRESENTED WITHOUT UNDERTAKING INDEPENDENT DUE DILIGENCE AND CONSULTATION WITH A LICENSED PROFESSIONAL. You understand that you are using this Information AT YOUR OWN RISK.