Sunday, December 25, 2016

Merry Christmas To All My Readers And Supporters


I have enjoyed sharing my success and expertise in the market with all my followers for the past 21 months.   You have encouraged me to produce fresh and new content every week with your retweets on my tweeter account  as well as you all sharing my content on Linkedin.   I have now over 6,000 followers from all different parts of the world  that read my content and I appreciate all the comments that you all share with me.   I want to take this moment to convey my very special thanks to you and wish you all a very   Merry Christmas.    Please continue to share your comments with me to help keep our conversations and discussions on the stock market going forward.  This will help us all learn from each other and make us all better and profitable traders and investors.    

I am writing this post on Christmas Day late at night in    Santiago Chile.   Chile is 2 hours ahead of Florida Eastern Time Zone.   This has been a fun filled day for me as I look outside my Hotel window with Andes mountains in the background.   The clouds  began rolling in just before sunset (it is summer here in the southern hemisphere with sun rise at 5.30 am and sun set at 9.00 pm)   It was a beautiful sight to see with clouds rolling in and hugging the canyons that separate the mountain peaks.   There was a rainbow between the peaks of the mountains and it felt like a very special and a magical moment for me.   This has been a very special Christmas Day for me and unlike any that I have spent in the US.   It is a very difficult day for me to write this post while I am enjoying all the sights and sounds of Chile but I know that you are all depending on me to get something from me every Monday before market opens so here I am putting down a few words for you.


Update on   $RDN   Virtual Trade


In my post last week, I was stressing the point of having a routine every week to build a    Stock Watch List    and the importance of doing   Virtual Trades   to sharpen trading skills.   That is how I come up with   Super Stocks   like   $NVDA   every year.   In the last 3 weeks since my post on  5 trades on this stock, this stock has produced a gain of   +24%     It  is now trading at the upper end of the channel and will most likely retrace.   

I had identified   $RDN    as a stock of study to carry out a   Virtual Trade   with an entry at   $17.75    We had set a trade plan for a   +10%  profit target.   Currently the stock is   +2.53%   for the week.   All the 3 major indexes    $SPY,   $QQQ   and   $DJX   have been trading sideways for the past 12 to 15 sessions but   $RDN   continues to march forward.   This is a sign of institutional support.   They are deploying money into this stock while the general market is just trading sideways.   In my post last week I had highlighted how the high volume had come in on July 5th, Oct 12th, Nov 9th and finally on Nov 16th to lift the stock from    $9.88   to   $17.58   for a total gain of    +78%    This is a stock that we can all learn very special lessons from in helping us identify the characteristics of a   Super Stock   


My Market Outlook 


I have a very bullish bias toward the market overall.   We do have    10 distribution days    and the   $DJX   has already advanced    +11.44%    since Nov 4th.   It is quite normal for the market to trade sideways like it has for the past 12 sessions.   I would not be surprised if the market does retrace a little.   It takes time for the market to digest the gains.   This would be a good time to harvest profits if the stocks have attained the profit targets outlined in your trade plans.   It would be prudent to raise the trailing stops as well to protect the profits.   

I have identified some of the stocks that I shall be monitoring this week.   Be sure to look over my tweets on Monday where I will share some of those thoughts with you.   The three sectors that are showing strengths in the current market are   $XLF (Financials)   $XLE (Energy)   and  $IYT (Transportation) 



Happy Trading!

Amin


 

Sunday, December 18, 2016

How Do You Find    SUPER STOCKS   like   $NVDA


In my post last week, I had highlighted how    $12,000    of profit was made with 5 stock trades on   $NVDA   in the last 7 months.   Lot of my readers and followers had a lot of questions directed to me in the last few days as to how did I come upon such a winning stock.   I had not given this question much of a thought in the past.   Every year for the past several years, I have come across such a stock with regularity.   It is not mere luck though.   I have stayed disciplined in building    My Stock Watch List    every week and stayed engaged with the market daily weather the market was in a   "Confirmed Uptrend"   as it is currently or when the market has high number of distribution days and   "Under Pressure"   or in   "Correction"  


I am on a 2 weeks vacation right now on a cruise to South America.   One of the the books that I read in the last several days was   "How to Make Money in Stocks"   by  Mr. William J. O'Neil (founder of   Investor's Business Daily)   I read this book every so often and I always learn something new every time I read it.   There are over 300 stock charts in the book with annotations and they help explain what Mr. O'Neil is trying to convey.   One of the remarks he has made in the book struck me very hard and I will share that remark with you:

"Over the years, I've found that only one or two out of ten stocks that I've bought turned out to be truly outstanding and capable of making this kind of substantial profits.   In other words, to get the one or two stocks that make big money, you have to look for and buy ten"


One of the things that I have impressed upon my students in my mentoring services is to do   "Virtual Trades"   This is a simulation and a practice run to sharpen the skills of trading.   It helps in identifying the stock personality and how best to trade them.    I do a lot of virtual trades as well and that is how I come upon winning stocks such as   $NVDA   that makes my year.


Virtual Trade on   $RDN

If you have ever been on a cruise ship, you would know how expensive the internet service is and it is worst than a dial up wifi - to add insult to the injury.   I did however manage to do my routine of building  My Stock Watch List and analyzing the market.   I did a thorough analysis of   $RDN   to see what the institutions are doing with this stock.   This is what I found:


  1. July 5th it broke out with +300% above average daily volume at $9.88 and within 9 weeks  +42.10   profit was made at $14.04  (we had a follow thru day on July 1st)
  2. Oct 12 it broke out with +150% above average daily volume at $13.79 and within 8 sessions  +6.24%   profit was made at $14,65
  3. Nov 9th we had a volume surge of +300% above average daily volume followed by volume surge of +200% on Nov 10th (we had a follow thru day on Nov 9th)
  4. Nov 16th we had a volume surge of +400% and stock gained   +16.59%   by Dec 16th


Could this be a   Super Stock?   I follow the lead of the institutions since they are the ones that account for the price moves of a stock in the market.   They have shown a commitment to the stock with their sheer volume in the past 6 months.   The stock has already made   +78%   since July 5th.   Currently the  RS rating is  91  and the  RS line is strengthening.   The stock is extended and we have   10  Distribution days    between the    $NASDAQ   and   $SPY    This would be a good stock to do a virtual trade on to verify if this could become a super stock.


My virtual trade would be:

Entry ... $17.75
Exit for Profit @ 10% ... $19.53
Exit for Loss   @ -4% ... $17.04
Time to exit ... Prior to earnings report on Jan 26



Happy Trading!

Amin



  




Sunday, December 11, 2016

My   Super Stock   of the Year


Every year, I come across a stock that makes my year.   Sometimes I miss them initially because I didn't listen to what the institutions were telling me.   Stock charts very clearly show the price and volume for each day the market is open.   When the institutions decide to take a position in a winning stock, it takes them several weeks to establish a full position.   I always look for increased volume above the daily moving average volume that results in an increase in the price of a stock.   That is a confirmation for me that institutions are competing against each other to accumulate shares in their portfolio.   

In my post last week, I had indicated that I will share with you some of the trading strategies that I employed on   $NVDA   during the last 12 months.   This stock came on my radar initially on August 7th 2015.   Market conditions were not favorable at that time to take a position but   $NVDA   surged   +15%   in volume that was   +700%   above average daily volume.   This is not a thin stock and it trades    +$200 million    daily (price of stock  X  shares traded per day)   This is a massive volume for the stock leading to an increase in the share price of the stock during unfavorable market conditions.   I was disciplined and stayed patient for an opportune time to enter into a position.   I continued to build    My Stock Watch List   every weekend and stayed engaged with the market even though the market was trending sideways during the summer months.   


Stock Trading History


My patience finally paid off within 2 months and an opportune time presented itself on October 2nd 2015.   Market was in    "Correction"   in September but than it rallied at the end of the month and we had a    "Follow Thru"   day on October 2nd.    Market status changed to    "Confirmed Uptrend"   I am a disciple of  Mr. William J. O'Neil - founder of Investor's Business Daily.   According to him,   "You should always buy something on a follow thru day"    Everything had just lined up for me to step in and take a position on    $NVDA


For illustrative purposes, I will use 400 shares of stock as an initial position ($10,000).   Total of  5 trades were established from October 2nd 2015 to October 24th 2016.   Profits were harvested within 3 to 7 weeks upon entering into these 5 trades.   Following is the summary:
  1. Oct 2 2015 ... entry  $25   exit  $28.50  (+14% in 4 weeks)
  2. Mar 21 2016 ... entry  $33.81  exit  $36.50  (+7.95% in 3 weeks)
  3. May 13 2016 ... entry  $40.09  exit  $45.66  (+13.9% in 3 weeks)
  4. July 5 2016  ... entry  $46.60  exit  $58.60  (+25.75% in 5 weeks)
  5. Sept 2 2016 ... entry  $$64.24  exit  $70.66  (+10% in 7 weeks)
Total accumulated profits from these 5 trades amounted to   +$12,072    This stock was never held through earnings.   We are in the 8th year of the bull market and earnings report can devastate the stock if the institutions don't like what they see in the earnings report.   I find it best to harvest profits before the earnings report is due.    

In my post next week, I will highlight some of the    Option Trades    that were initiated to take advantage of the stock trading along the    8 day ema (exponential moving average)   or the stock consolidating for several weeks while the market overall was consolidating.   The stock had a phenomenal performance of    +182.64%    from Oct 2nd 2015   to Oct 24th 2016.   Utilizing stock purchases as well as Options on stocks, we can increase our profits substantially without taking the risk of holding the stock through earnings.


Mentoring Service

If you would like to learn our system of     Identifying Growth Stocks    such as    $NVDA   and to profit from it, contact us    @ investorspotlight@gmail.com   



Happy Trading!

Amin

     

 








Sunday, December 4, 2016

Time to Look for a  "Super Stock"


Every year, I come across a stock that makes my year.   For me it was    $NVDA   this year. It didn't happen by an accident though.   It took a lot of work analysing the stock chart, anotating chart and writing a detailed trade journal for every trade that I methodically placed on the stock and options on the stock.   There are a lot of lessons learnt with every trade.   The key is to duplicate those trade set ups that have been profitable for you and to avoid doing what doesn't work for you.    It sounds like a simple idea but putting this into practice is what it is all about. 

Currently the outlook of the market per   IBD (Investors Business Daily)   is   "Uptrend Under Pressure"    We have 11 distribution days between the 2 major indexes  -  $SPY   and   $QQQ.   This is the time to be cautious.   It is also the time to protect your profits in a position.   Harvest the profits if the position has met your profit targets.   Follow your trade plan for loss exits as well and don't let your emotions dissuade you from closing out a losing posiition.   It takes as few as 3 to 5 sessions for the major indexes to slice through the    50 day sma (simple moving average)   I have illustrated several times in my post how you can still be ahead even if you lose half of the positions you take.   The key is to follow your trade plan for profit exits but also for   LOSS     exits.   That is how you manage your portfolio.


My  "Super Stock"  of the Year



During the month of December,  I shall highlight   $NVDA   as a case study for educational purposes.   This stock is  +160%   in the last 8 months.   It is reaching its peak now and there may just be very little juice left in the stock for such gains.    Stocks such as these appear on a regular basis but it takes the discipline to be totally engaged with the market on a daily basis.   Currently most of the growth stocks are extended and they are consolidating and building new bases.   This is when I do most of my work looking for that needle in the hay stack.   As a retail trader and investor, you don't have to trade every day and all different stocks in a year.    Once you identify a   "Super Stock"     such as   $NVDA,   you can trade the same stock and options on that stock all year long for substantial gains.   My posts for the next 2 weeks will highlight this strategy for you.      



My Market Outlook


I still have a bullish bias towards the market.   We can expect the market to consolidate this week, especially after having had such a good month in November.   Financial sector has been leading so far but they have come up too far already.   Lot of them have been consolidating for the past  7 to 10 sessions.   I am focusing my attention on the transportation sector  -  airlines, railroads, truckers and shippers.    I would suggest you take a look at the stock charts of   $FDX   and   $UPS.   December is one of the best months in the stock market.   This week will determine where the market will be heading and what sectors will the institutions favour.   


Be sure to look over my tweeter account @  spotlightamin    I tweet some of the stocks I am monitoring and some basic facts about their performance.   Be sure to retweet any content that you find useful to you.   This way we get a wider community of traders and investors involved in the discussions.   It will benefit all of us and we all get to learn from each other.




Happy Trading!

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.


The Information I provide is for education and informational purposes only. The Information provided is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice. The Information provided is general in nature and is not specific to you or anyone else.


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.