Monday, February 5th was an impressive session for markets:
- The S&P500 finally exceeded a 5% pullback (first time in a 12months+)
- The S&P500 went red on the year after being up nearly 6% in January
- The S&P500 saw the heaviest volume since 2016 (almost 300M shares)
How to trade stocks using daily closing prices walks through the best practices, tips, and recommendations for implementing a strategy that uses daily closing prices for its signals.
If you’re thinking about giving up intraday trading and extending your time-frame or if you’re a long-term investor looking for an active strategy to manage risk, this article will help give you some ideas to think about and test out.
We share a lot of trade ideas and strategy here at The Trade Risk but it’s primarily from the point of view of momentum, breakouts, and following recent price movement.
Mean reversion trading is a style that relies on price action to look much different (in most cases the exact opposite) as momentum, and it’s something we haven’t written a whole lot about on this site.
We finished higher across the board for the final trading session of October 2017 with the small cap Russell 2000 stocks out in front leading the charge.
All of the major indices are trading at or very close to all-time highs, and the S&P500 ($SPY), in particular, is set up going into Wednesday with back to back inside daily bars.
We finally saw a mild gap down and a shakeout this morning after a long stretch of quiet trading, but what little selling pressure there was did not even maintain throughout the entire day.
The QQQs led us lower, finishing down approximately -0.37%, but well off the lows of the day, the IWM nearly flat, and the SPY flat.
I continue to remain most suspect of the $QQQs out of the all the major indices, but for now, bulls remain very much in control of these markets overall.
Here are some individual stock setups that are offering up some interesting looks, shared on Stocktwits & Twitter earlier today:
How to Develop Simple Swing Trading Strategies lays the foundation for developing short- to intermediate-term overnight trading strategies. We’ll start off discussing what the goals of swing trading are and then move into some of the recommended steps to go about creating a strategy from scratch.
There are no holy grails we’ll be uncovering, but hopefully, the steps and framework outlined in this article will give you a responsible path towards creating a strategy to call your very own.
Sellers have first movers advantage out of the gate in post Labor Day trading, which typically represents a period where the majority of market professionals jump back into the driver’s seat from their summer vacations. In early trading, all of the major averages exceeded -1% losses to the downside.
Here’s the technical picture of the S&P500 ($SPY):
Following up today’s 1.5% drop in the S&P500 $SPY, we take a quick look at market internals via 52-week highs/lows to see what they have to say.
This first chart is a YTD look at the number of NYSE stocks hitting new 52 week highs and lows. It’s quite clear to see the uptick in the number of new lows throughout the month of August to the highest levels seen all year. At the same time, the number of new highs has dried up.
The Dow Jones Transportation Average represented by the $IYT ETF has been a strong performer throughout May and June. It broke out to new all time highs on July 3rd, resolving a multi-month range sideways.
However, over the past week of trading, we’re seeing some near-term selling pressure come through, and a break of this accelerated bullish trend line.
Here’s the IYT on the daily:
Markets kicked off the week of Monday, July 17th choppy and mixed finishing relatively unchanged on the day. We’re heading into prime time earnings season which means potential sector/stock catalysts (positive or negative) could be right around the corner.
Here’s a short list of some of the swing trade setups that are on my watchlist over the next few days.
Given its earnings season, double check all of the report dates that follow.
The Russell 2000 $IWM is first up as it consolidates high and tight at this 142 area that has acted as resistance since early June. Today’s close was pennies away from all time closing highs.