Education Center
Could you explain the trading curbs that I am now hearing about? Are they triggered electronically; are they for individual stocks or indices as a whole?
Trading curbs apply to the NYSE. It restricts program trading when there is an abrupt move in the Dow Jones Industrial Average. When the Dow moves 200 points higher or lower than the previous session’s closing price, the restrictions kick in. They stay in place until the Dow returns to within 100 points of the […]
I was wondering if I could get your input on JDSU in the very short term like in the next bounce. Took a pretty big hit again so looking for cheaper stocks for one or two plays until we can play the indexes again. It seems we lose maybe 1 out of 10 trades but the 1 loss always seems to hurt the most.
Your question has a couple of very good points in it. First, let’s look at JDSU. A major fiber equipment company that enjoyed explosive growth in 1998 and 1998. It was another one of those Cinderella stories that made investors a lot of money. Then it became the darling and everyone had to have it. […]
When a doji signals a potential reversal on a daily chart, does the reversal have to occur the next day?
You are correct in saying a doji signals a ‘potential’ reversal. A doji rarely means ‘buy’ or ‘sell’ all by itself. We need to see a confirmation of the move. Even when we see a doji on support or at resistance and the volume looks right (e.g., falling volume on a rise to resistance in […]
Where can you get a “real-time” value for the put/call ratio during the trade day? Also, where can you get end-of-day numbers for NASDAQ and S&P futures?
We have not found any place on the web that provides up to the second put/call information. For end of the day (and after hours) futures information, try http://money.cnn.com/markets.
If a stock like OPMR has 91% institutional holding does it have much more room to go? How does that work?
It may seem as if all of the institutions that are going to buy the stock have already bought it. What institutions do, however, is accumulate positions over a long period of time. Moreover, when a stock is a winner for an institution, that institution will average up in the position, buying more shares when […]
How do you figure the target sell points for stocks like EASI and others breaking out to new highs? Is there a percentage you use? From what point do you start figuring since they keep making new highs?
In this market where we see a solid move then sell back, we are looking for a 20% move as our target. That might be a bit much, and if a stock starts to show topping signs after 15% (e.g., a gap higher and selling back, a close well off of the high on either […]
In 1982, what spark lit the fire that took the S&P off it’s lows?
Recall that in the late 1970’s the U.S. had suffered inflation and no growth (‘stagflation’), and the goal was to end inflation and thus allow the economy to grow once again. To do this, the economy was purposefully slowed, and then was jump-started with the Emergency Economic Tax Recovery Act of 1981 that gave massive […]
We have had a number of questions on stop losses in this market, so this seems like a good time to discuss them a bit.
One of the problems with a stop loss in a choppy market is that the volatility intraday can take you out of a play when it then turns higher after a test lower. Of course, when you don’t have a stop loss in place that intraday touch lower stays down and does not lead to […]
Where do you find the 50 day MVA on a particular stock in your portfolio?
There are many good charting services. One that our subscribers have told us about many times is www.stockcharts.com. You can enter the ticker symbol and it will give you the chart and show you on the chart where the moving averages are and it will also tell you the actual price for the moving average […]
I don’t understand what this “buy up to ‘price’ ” means. If I buy a stock at 19.60 and the target is 20.58, do I sell at 20.58? Is that a point at which you think it could [start a] re-test the breakout and go down? I know NOT to buy higher than 20.58, but do I hold it at that price?
The two targets are discrete: First (“a buy up to…”), we will buy on a breakout move up to 5% over the breakout price. That is just our standard target for buying ON THE MOVE, because once the stock gets over 5%, it has already made a good move and more likely ready to take […]
