Sell USO

Sell the rest at 78.40. Got a spike and it doesn't look very sustainable. Profit takers are coming in and it just doesn't have enough upside from here in the short term.

Sell COST

Sell COST at 65.60 for an easy 5 % gain. I think it has limited upside in the very near term and could easily come back down to test the 200 sma again.

Boone Pickens' Big Mouth

Boone Pickens got on CNBC this morning and let everyone know that he was shorting oil and natural gas. Considering that he's been one of the leading energy bulls for a long time now, I'm inclined to believe him (especially when he puts his money where his mouth is).

Oil isn't reacting all that horribly considering its been up so strongly the past few days. The action so far looks more like profit taking than a complete change in attitude. Right now its off just about a dollar (USO at 78.30ish). I'm waiting for more of a signal before recommending selling the second half of USO.

Bad News, Decent Action; COST

Even after a weak open off of negative CPI data, the market rebounded and was able to close higher on the day. Financials paused and even flourished a bit, but I wouldn't expect too much more to come. Relative to what we have been seeing in the past few days though, this action's pretty decent. As long as we don't get any terrible news in the morning, an up day is a good possibility tomorrow.


COST bounced off its 200 sma by more than a dollar today. It's looking like the moving average will hold and provide good support from here on. Keep a stop around 1 % below the 200.

Weak Financials Lead to Fading Market

Just as I suspected! Weak financials (especially the brokers) led the market to fade after a gap open that just couldn't go anywhere. The market's in a choppy trading range. You have to pick your spots and find the strength. That means oil (needs to consolidate a bit after such a strong gain), nat gas, commodities, and some select tech.


Look at the COV triangle. Watch for a breakout/breakdown. Right now it's really a toss up as to which one will occur. On one hand you have up days occuring on big volume and down days on shrinking volume. But, you have to still be aware that any adverse event in the broad market could really take down the entire market. It's best just to wait until the break occurs and take a position accordingly. It should be coming very soon.

HPQ's up after hours and should lead tech to a decent open tomorrow. We'll have to see if it can hold.

Oil's Flying

Oil is flying higher this morning, with the USO up about 2.5% now. I would sell half of the position here at 77.90ish for a quick 5 % gain.

Also, watch the financials! The XLF is only up around .3% while the S&P is up a full percent. Retail is struggling as well. I'm not calling a reverse (just yet) but I continue to think that this isn't the type action that will lead to a real sustainable gain. I'd much rather see the financials leading than flat.

I'm going to be watching intraday for fades between these sectors and watching the close for strength and weakness. I'll keep the blog updated.

Financials Hold Everything Down

Financials failed to participate in Tuesday and Wednesday's rallies and participated greatly in today's decline. As long as this continues no sizable rally will occur. Continue to watch for the retest (1275ish on the S&P). Once we get there, look to buy at support and stop out below.


One trade idea: VAR looks shortable again. That stock has a small channel it's running in from 54 to 51. Look to get in on the open or close to it tomorrow.

Make sure you check out Dr. Steenbarger's post highlighting today's negative TICK reading over at traderfeed. Here's the link: http://traderfeed.blogspot.com/. His blog is always contains excellent information.