Can Nasdaq Make A New High?

I have been unable to update my opinions and trades the last few days but will try to post more often. This is a very busy time of year for my other businesses and was unable to post. Anyway back to the market.

The Nasdaq (QQQ) is in a very interesting location.

The market experienced a very sharp sell-off which I marked with the yellow arrow. I was actually hoping for more of a continued move down to retest the $50 which I was looking to buy. The $50 area is a very strong support area that the market has failed to break over the past 3 months. The Nasdaq has since reversed course and is threatening to take out a key pivot at $57.50. I marked this area with a blue arrow.

I believe Nasdaq may be setting up to make a new high. Now the QQQ is holding right above the daily 200ma. An aggressive trader could take a small position if QQQ were to break and close above $57.50. The real test is the resistance area close to $60. The QQQ has tried to break above the $60 mark about 3 times now.

If the market can break above and hold $60, I expect to see a very sharp move to the upside when that happens. The market is still very volatile so I wouldn't set a long term bias until  I see $50 or $60 break. This is an environment for trading so I would stay nimble.

New Blackberry Phone, Code name London

The device is rumored to be the first phone than would be running on the new Blackberry QNX operating system. It is expected that the new device may launch late next year. The new Blackberry is rumored to have the following specs:

1.5 GHZ dual core processor
1 GB of RAM
16 GB onboard storage
8 megapixel rear camera
2 megapixel front camera

It looks like Blackberry has finally gotten on board the band wagon and redesigned its original design. I believe RIMM is finally getting the picture and heading in the right direction. The question is, are the new QNX devices enough to turn the company around.

Source: The Verge

Groupon Fastest Growing Company In History

Groupon already has been called the fastest growing company in history.

In Groupon’s second full year of business, 2010, it pulled down $713.4 million in revenue, according to its IPO filing. The revenue a year earlier was $30.47 million. That’s a growth rate of 2,241%. Yes, you read correctly.

(Groupon’s “revenue” is the amount of money a consumers pays for a Groupon offering. Gross profit, or the money Groupon actually retains after sharing revenue with its merchants, was $280 million last year and $10.9 million the year before. That an even faster rate of 2,462%.)

Here is a look at how other hot tech companies, including Google and Amazon.com, grew in their earliest years. Groupon puts them to shame.

Google, 2004 IPO

2000 revenue (first full year): $19.1 million

2001 revenue (second full year): $86.4 million

Growth rate: 352%

Amazon.com, 1997 IPO

1996 revenue (first full year): $15.7 million

1997 revenue (second full year): $147.8 million

Growth rate: 838%

Salesforce.com, 2004 IPO

2002 revenue (first full year): $22.4 million

2003 revenue (second full year): $50.99 million

Growth rate: 128%

(Note: for years ended Jan. 31, 2002, and Jan. 31, 2003)

eBay, 1998 IPO

1997 revenue (first full year): $5.7 million

1998 revenue (second full year): $47.35 million

Growth rate: 724%

iPad 3 Launch

Now that the iPhone 4S was launched consumers are now waiting for the new iPad 3 to be released. We can assume that the iPad 3 will launch in spring 2012. Asian sources estimate that the launch could happen during March next year at the earliest. I expect the launch to happen closer towards the middle of next year.

One of the challenges in determining the launch date is Apple's dominance in the tablet market. Many companies launch a new product to compete a competitor. There are no tablets that are currently able to compete with the iPad 2. Apple's recent earning show that iPad 2 sales have increased  146% to $2.8 billion compared to the same period in the previous year. Apple sold 11.1 million iPads which marks a 166% increase over the previous year.

The lack of competition may push Apple to delay the lauch to later in the year to allow the company to further maximize iPad 2 sales.

The iPad 3 is expected to have the following:

Retina Display: People were expecting a retina display with the iPad 2; but the iPad disappointed them with the same display of the previous iPad. Now followers are waiting for an iPad 3 with a retina display. There is a rumor that the iPad 3 may offer a resolution of 2048×1536 pixels.

SD Card Slot: People are expecting a revolution in Apple iPad 3 with an SD card slot. Hopefully Apple may introduce SD card slot with the third generation iPad.

Improved HDMI: Yes iPad 2 also supports HDMI playback but you need to have Apple digital AV adapter, and that comes at an additional cost of $39. So it is much expected from iPad 3 to have an HDMI port that eliminates additional requirement of the HDMI cable.

Camera Flash: A camera with flash is a much-waited feature of the iPad; people were expecting iPad 2 to have camera flash; now we would be wondering if iPad 3 will have camera with flash.

Thunderbolt: The iPad 3 may have a Thunderbolt port. That will offer power, video and data connectivity using the same connector at lightning speed.

Wireless Synchronize: People are expecting iPad 3 to offer wireless sync of content rather than the traditional wired connectivity.

The Nasdaq (QQQ) Continues To Follow Through

The Nasdaq (QQQ) continued to follow through the last two days holding the pivot point we have been watching. We need the market to create a new high which I marked with a yellow line in the chart. We need a new high to ensure that the current bullish trend is still intact. If the market were to fail to create a new high then it would be at risk for a possible sell-off.

Nasdaq (QQQ) still Bullish

The market bulls felt some pressure over the last few days after experiencing a hard selloff . I turned bullish on the nasdaq when it broke above the high the of trading range. It is not uncommon for the market to pullback after breaking above a tough resistance point. You have to remeber to follow the signs the market gives us. The last pivot point held after a retest and so far looks like it is heading higher. I marked this retest with a yellow arrow. I will not turn bearish on the market until the $50 support level is broken. If the lows break after this much of a move I would expect a large move down. I would then look to short the market heavily at that point. I will remain bullish and follow the market trend until I see signs of change.

Close Avon (AVP) Position

I'm closing the AVP position even though it hasn't stopped us out or hit our target. This taking way to long to move. Avon should have popped much faster if it wanted to rally. We are better off looking for another play. Avon is pretty much near our entry price so it's a break even trade.

Book Some KONA profits

We hit $7, book some profits, we got a 40% move in one day. Nice ride from $5.20 I have a big target of $7.50-$8 which is a retest of the pivot. I expected to get this move over several weeks and we got it in a day.

Kona Grill (KONA) close to triggering

I'm looking to buy KONA above $5.20 with a stop below $4.70. This is a trade off the weekly chart so it could last several weeks. I'm looking to take profits around $7.50, near the most recent pivot high on the weekly chart. If the stop gets taken out before our entry then the trade is invalid.

Check out my  Kona Grill (KONA) fundamental lesson on Seeking Alpha.

New Apple 3D Technology

Apple just recently got approval for a new 3D technology that could take its devices to a whole new level. The new technology does not require glasses and could be viewed by multiple people at the same time. This of course is the challenge with current 3D technology. Apple's technology gives each viewer a different line of sight for both left and right eye. This perfects the stereoscopic image for a group of viewers watching one giant screen.

I could see Apple licensing out this technology to the movie theaters as well, this could bring a new revenue stream to the company.

This could be a huge advantage for Apple and could revolutionalize the direction of the industry. I could see this technology going into the next line up of devices and will most likely go into Apple TV sets as well. These new Apple TV sets are expected to launch in December 2012.

Keep an eye out for my article on Seeking Alpha that goes over the huge potential of Apple TV.

Nasdaq (QQQ) Breakout Underway

I'm now bullish on the Nasdaq (QQQ) after the breakout of the range. I have been waiting for the market to breakout or breakdown from the trading range. That move finally took place with Nasdaq breaking the high around $55.70.

I will view the next pullback as a buying opportunity for a swing trade. The pullback must stay above $52.50 that will create a higher low in the chart. A swing trade is a trade that lasts several days.

The blue arrow shows Nasdaq breaking above the 200 daily MA as well as breaking above the trading range of the last few weeks. I like the fact that the QQQ's have created a higher low with each pullback.

 The weekly chart shows how Nasdaq has held up during the last pullback near the $50 support area. I like how the market has held up in an area that was a prior resistance point for the market. Whenever a resistance point is broken, it often turns into a support area. If Nasdaq (QQQ) breaks above the $60 area and holds, I will look for further gains. I will look to move my long term portfolio back into the market at that point.

Market Is Looking For Direction

Nasdaq

The QQQ's has failed to find a direction in the market and continues to be rangebound. I'm still leaning bearish but I'm not yet ready to commit to long term shorts just yet. I want to see a breakout or breakdown before I commit to a bias.

Support is the $50 area and resistance is at $55.50, I want to see a daily close above or below for me to consider that area to be broken. I marked the key areas with green arrows.

European concerns are still a drag on the market and could finally push the market enough to breakdown. I recently moved 70% of my long term portfolio into cash (Composed of 50% T-Bills/50% TIPS) to position for a move down. If the lows break I expect a large move down which could take us to the $44 area in the QQQ's.

Europe is in a tough situation which I don't think will end well. EU has yet to agree on terms on how to handle Greece's bailout situation. If the EU were to fail to agree I could see risk off trades back in play which could lead the metals higher once again. I will keep an eye on this situation to look for opportunities to trade.

Avon

Our Avon (AVP) trade is still in play but is real close to stopping out. Normally I like to see a bounce occur much faster, but the market has been pretty choppy last few days.

Position Update

LULU

If you took the LULU trade you got stopped out when the stop got taken out.

AVP

AVP stop held in and is still in play. AVP is trying to break the most recent high and if it gets taken out we could see the $24 area.

LULU Second Move Down

Looks like we are getting our second move down on LULU. I have been bearish on LULU and think they still have a long way to go down. You can read my write up, Lululemon look out below. What I don't like about this setup is you might run into the 200ma which may become a support so if it can't break that  moving average, take the position off. You could use $53.52 as your stop if you want to try a short. I think I would take some off if I could get 2X my risk and as usual I will trail with a breakeven stop once I'm up $3 on this stock.

LULU was once a high flyer on wall street and any time the market realizes that growth will slow down the stock is usually severely punished. I think that same thing will happen to LULU.

Apple Profits Booked

The Apple trade worked perfectly as expected. I felt the selling was over done and if you followed our plan you would have made money. Apple opened alittle above the area we wanted ideally but you could have entered on the breakout in the $360 area. You had to enter in premarket trading in order to get in. Here is Apple premarket:

Apple traded as high as $375 way past our minimum target.

I don't think we'll get a trade in Apple like this again for a long time. This is one of those rare instances where the market was completely over reacting and astute traders could take advantage of it.

Apple sell off on Steve Jobs news, great buying opportunity

Apple sold off as much as 7% in after hours trading on news that Steve Jobs is stepping down as CEO. It appears the fears may be a bit over done and I think you could take advantage of a gap down into support on Apple. I will look to buy one lot of Apple on a gap down in the $355 down to the 350 area. I would buy two lots of Apple at the 200ma which is around $343. I will also look to add on a buy setup if I get a good buy pattern. I will use the $339 area as my stop so be sure to position size correctly to your risk. I would like to see support first before buying if we gap below $350. This trade is also invalid if it trades below $339 before we are able to buy. I marked support and buy areas with green arrows.

If we get a buy from the $350 area, I would like to target the $360-365 area. Be sure to properly trail the position and move stop to breakeven once your 3-4 points in the money.

AVP near 20ma target

Our AVP trade is doing well heading towards our 20ma target. If you used a tight stop under $21, you would have gotten dinked out on the failure to hold above the 8ma. If you used the $20 stop, which is the low of the pivot, you should still be in. AVP came close to breaking the low but it held in.

The 20ma should be a good first target but I think there is more room to run if it could break above it. I'm not gonna give AVP to much room because of the volatility in the market. I would take at least a third of the position off on a test of the 20ma and move the stop on the rest of the position to breakeven.

I will also move the current stop to 20.47 to tighten up the risk. I marked the stop loss area with a red arrow in the chart.

What a killer Goldman Short

Too bad my followers did get a chance to participate in this sell off.

It dropped 6 points right after I submitted my writeup to Seeking Alpha. I finished my article at 3:14pm.

I didn't expect this big a selloff  but when you position yourself correctly, sometimes you get rewarded.

AVP nice daytrade with a tight stop

AVP is a buy at this price at $21.78. After chopping around for several days AVP finally made a strong move that it is ready to try a relief rally. I'm looking for AVP to get back to it's daily 20MA around the $24 area over the next few days. If you want an aggressive stop you may place it below the $21 area or if you want to give yourself alittle more room you may place it below $20.

I

I marked the entry with a green arrow and possible stop areas with the red arrows. You can learn more about my strategies in the swing trade lessons section.

QQQ following through with our rally

The QQQ's is following through with the rally that we have been expecting. The QQQ were very quiet in the morning session rallying late in the day to close the day at it's high. I wouldn't celebrate the rally just yet. We have some major resistance that will be coming up in the $56 area so I would expect that to be the first test. I wouldn't be surprised to see the QQQ's pull back alittle here which could actually be a bullish sign if it could create a higher low.

We want the QQQ's to break above and hold that $56 area in order to get momentum to test the highs. If we hold above we could look to test the $59 area once again. I marked the $56 resistance area with a red arrow.

I would look to take alittle profits on any longs if we get another day or two of rallies without any pullback.

Find out more about this QQQ Daytrade.

QQQ's weak rally

The market pulled off a quiet rally today without much volatility. This week was one of the markets most volatile weeks in history which made it very difficult to get a read on the market. We got a small gap this morning that didn't get much follow through. I still think we could continue with this bounce that we are getting in the market but I wouldn't be surprised if we chopped around here while the market consolidates the extreme volatility we have been experiencing. I believe on the top side we could get near the $55 area which could serve as a strong resistance area going into an options expiration week.

The market still seems weak and I believe it's still to early to decide which direction the market wants to go to open swing trades. Daytrades are the best way to go for now. You want to stay nimble until the odds move back into your favor and you have a good feel on the market.

Find out more at investanomics.com

Failure to hold a break on QQQ

The QQQ's has failed to hold on to highs after the break of the $53 area. This shows there is heavy selling pressure and it looks like the market could have a rough time recovering losses. I was looking for swing plays that could take advantage of a market bounce and couldn't find any good risk/reward trades. The market is just to volatile to take swing trades at this point so daytrades come in handy in staying nimble and bringing in profits. I posted a couple day trades on SODA and CREE earlier today that worked to perfect. This type of enviornment is where it pays to be an all around investor and trader taking advantage of the different waves of opportunity the market provides.

I believe if the market could break and hold above the $53.50 area in the QQQ's, we could see the market try to test the upper resistance near $56. Any failure and break below $50 in the QQQ's at this point is a very bearish sign which will bring alot of panicked sellers into the market since at this point. There are many stops sitting below the $50 area and a break of that area will change my bias to bearish.

I definitely have my shopping list out and looking for opportunities to take advantage of this move in my long term trades. This is a great time to watch those penny stocks and target those value plays.

Learn more investment lessons at investanomics.com

Money in the bank! Solid day on SODA and CREE Summary

Daytrades were posted in real-time with updates. I don't usually like to post daytrades but I really liked these plays and felt that they would be excellent lessons in how to daytrade correctly while seeing them unfold before your eyes. So you get the opportunity to see what I see at the same time as the trade unfolds. It is very difficult to manage a trade and update the blog in real-time while taking pictures so I tried my best to update quickly.

Now to the summary:

CREE - Profits banked at $36.31 banking an average profit of 3X risk. This position fell alittle short of our 90 cent target area and I was to busy to update the trade here on the blog so I will just use the last post to update the blog which was when I moved the stop to $36.31 if you were following my techniques you have gotten out at $36.55.

I highlighted in green the arrows I was looking at for a trigger. The blue arrow represents the trigger and the red arrow was when the final lot was exited.


SODA - Exited the final piece at $46.95 bringing our profits to an average of $4/share. This is about 1.3X our risk but had an opportunity to trail it tighter when you hit $48.48 but again wasn't able to update the trade in the blog so I just used my last post to update the trade here.

The blue arrow was the trigger and the red arrow was when the final trade was exited. It took us two looks until we got the right trigger since the first look was invalidated by taking out the low first before rallying which is my first post on this trade.

Like my comment yesterday on the market it is not uncommon to see a retest of the lows in stocks as well as in the market before the rally comes. The key is knowing which one to take.

I base my returns off multiples of risk because I believe that if I'm right just 50% of the time but average more than 1X my risk then over time I will make more money. So if I could get 2X or 3X risk on half my trades then I could make good money.

Learn these strategies and more at investanomics.com

CREE Profits in the bank on a nice daytrade

Banked 3x risk on CREE with a tight stop. move stop to breakeven at 36.11 sold 3/4ths of my position in the high 30 cent area. On these type of breakout plays I like to use tight entries to maximize returns. You have to let your winners run and worst case scenario the rest of the trade takes you out breakeven. Close the position near the end of day if our 5 min trail doesn't take us out.

There's a reason why I watched CREE all day to get the trigger and why the breakout was successful. Learn the techniques at investanomics.com

UPDATE:

Take profits on rest of position in CREE in the $46.90 - $47 areas stop now $46.31

SODA stop update

Move the stop on SODA to $45.90 below the 5min pivot locking in at least another $2 on our last quarter position left. Looking to take the rest of the position around the $49-50 area.

Wanna learn to trade this volatile market check out investanomics.com to learn more.


UPDATE:

Move SODA stop to $46.95 to lock in profits

Cha-Ching on SODA taking a $2 move, taking only partial profit

I would take some profits here with the rest of my stop at breakeven using a 5min pivot trail. Nice $2 move that came within 15cents of taking us out at breakeven but held in. I think we could get more so will try to ride half into the close or my pivot trail gets taken out.

Learn to pull profits like this at investanomics.com


UPDATE:

Taking another half of my posittion with a $4 profit quarter of my position left with $3 banked

move SODA stop now to breakeven

Time to move our SODA play to breakeven at 43.61 we don't want to see it fail at this point so worst case scenario is break even for us now.

CREE potential breakout

I'm watching CREE for a potential breakout move. The strong had a real strong opening and I believe this consolidation could be setting up for a nice breakout daytrade. Resistance is the $36 area so I want CREE to break above that to go long.

Find out more about daytrading at investanomics.com

SODA another shot

Buy SODA on a move above 43.60 with a stop below the low at 40.80 first target is the 20MA and trail the rest following my pivot trail method. If low is broken before our trigger then play is invalidated.

Find out more at investanomics.com

SODA trade invalidated

SODA failed to give us our tigger and broke the low hitting 40.90 invalidating our play. There is a chance that this will bounce going into the afternoon session so keep and eye out.

Check out the strategies at investanomics.com

Day Trade on SODA

Take SODA on a 15min trigger, a 15min bar must close above 44.05 and a stop below the low at 41.15. This is only for a daytrade and must be closed before the end of the day. First target is 8ma second target is 20ma and big target is in the $50 area.

If the low gets taken out the trigger the play is invalid.

Follow me on investanomics.com

Is this the next round of selling?

The market had another strong day of selling but does this mean that there is more to come? I'm not convinced yet until we break the lows which on the QQQ's was $50. It's not uncommon for markets and stocks to retest lows after heavy rounds of selling. Retests aren't a sign of weakness but actually could be a sign of strength. Why is that? If the market or stock trys to break lower and fails then it shows that there is strong support in that area with alot of buyers. That actually could provide a great opportunity to add to a position with a tighter risk since your stop should be at the low of the closest pivot.

So far the QQQ's have failed to break above the last red bar and has failed to break the $50 low so we are still in a sideways range. Support and Resistance triggers are marked with arrows.

I still have an upside bias but we play the market waves so which ever way the market breaks is where we will position ourselves. If these lows break I believe we could see some pretty heavy selling but I would prefer to see a bounce first before entering any new shorts.

Right now the smart thing to do is look for plays to add to my long term portfolio. When markets get hit hard it's always a good idea to update the shopping list.

Learn more about my swing trading and core trading investment strategies at investanomics.com

Is this finally the bottom?

I think QQQ's can get to $55-56 as a 1st target and $58 as the top target. If QQQ's close below $50 then I believe we have a hard move down and I will look for stocks to short.

Could we have a bottom in place on the Nasdaq QQQ's ? I think we may have a short term bottom for now. It looks like the markets welcomed the news that Fed have decided to keep rates near 0% till 2013. Now no one really knows the true reason for the rally and I have noticed through the years that news outlets like to make up reasons for all the movements that go on in the markets with no real confirmation other than talking to a trader somewhere and that's what they think is going one but the market is not made my any one person. But anyway back to what we were talking about. Buyers could come back to the market now that they have confirmation rates will remain low for the forseeable future. So why is that? Well if you know rates are gonna be at 0% for the next two years then why stay in T-bills and money markets. You definitely can make more from stocks even conservative blue chips that are now paying 6% dividend yields.

This is what we know. The market is heavily oversold, blood and fear is in the streets and the Fed pretty much said they will do anything to support the markets. I have seen this happen before and one thing I know is don't cross the Fed. If they want something to rally it will and if they want something to fall it will. It might not happen right away but it eventually will. They have a lot of tools at their disposal and are very big force to go against. In the dot com bubble the Fed wanted to slow the over heated economy at the time and said the will raise rates to slow down the economy. So what did the crazy market do? It rallied and rallied, it pretty much blew off the Fed. So naturally what did the Fed do? They pretty much raised rates until the market got the picture that the Fed was just gonna keep on going till the market dropped. That move led to the dot com bubble bursting and to a big short position for me. The Fed then wanted to support the waek economy and prop up the market. So what did they do? They keep on lowering the rates which led to the strong rally that preceeded the financial crisis.

Does this sound familiar? Markets have a tendency to repeat themselves and now the Fed wants to support the market. I believe not only the Fed but the government will do anything to prop up this economy and we could see a pretty good bounce back. Now for me to remain bullish I still want the markets to hold above the lows made today.

Investanomics The Beginning

Investanomics was created to provide new investors and traders with insights into the market movements and help gain that consistent profitability many are looking for. I have been investing profitably in the markets for over 10 years and would like to bring those lessons to investors the same way I learned. My mentors help give me the foundation to get started in investing and I have learned many different strategies along the way that fit my style of investing. I believe no one strategy fits all and in fact that investing is a continous learning process.

When I first started trading in 2001, the markets were a much different place than today. My level 2 screen showed market makers, ECN's were a new thing, stocks traded in fractions and algo trading was up and coming. Today trading is anonymous, algo trading accounts for over 80% of volume in the markets, we trade in decimals and the speed of the movements are lightning fast with never before seen volatility. You have to be able to adapt to be able to survive in the markets. After all you are going against the biggest institutions in the business that have unlimited amounts of capital and everyone has the same objective, take each others money.

Follow me on this journey as I document my thoughts and plays on this blog. Learn more about my strategies and plays at investanomics.com