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Trade for LifeTM
Intraday Alert From the VCM Research Department For June
25th, 2007 Market Update A fairly simple straightforward day for market analysis.
A quick look at today's Trading Letter explains what happened today so far. We
had a pullback on the hourly chart in a retest of the bullish wide range bar
(+ WRB) and the low tha was set on last Thursday.
This area
can be considered major support because the last time we were in this area a
bullish wide range bar (+ WRB) developed for a significant rally. The retest
of that area would likely bring in some buyers as we saw today. This made for
a nice intraday bounce from the lows to the current high as we are seeing
during lunch. It is very likely this may be the end of the rally as we have
now entered the lunchtime doldrums at in an area of the downtrend line from
the prior highs on the hourly chart. Trading idea: Traders of the E-minis or the QQQQ/SPY should maintain a neutral bias until a trend is established on the 15 minute chart. At the moment we are likely setting up a sideways pattern it on the 15 minute chart. The bigger picture could certainly go higher from here as we have four lower highs on the daily chart into the rising 20 period moving average. This combination can never be overlooked as a bullish possibility. New Play Idea: Today's play is a possible long swing trade from the
daily charts on CAREER EDUCATION CORP. (CECO). Sector: Education & Training Services.
The Technical Setup: VCM failed breakdown on the
daily chart. CECO had a very bullish gap and run back in the beginning of
May. Since then it has been mostly sideways and after a period of tight
sideways consolidation looked like it was going to break below the base on
Friday. A partial bottoming tail formed and today we see a complete reversal
of that breakdown bar. The failure for the stock to go lower usually
indicates that buyers are present and we will see an upward movement in the
stock. We will look to today's intraday chart for our entry and stop criteria,
using today's high of the day for the entry and the five minute base for the
stop. The Play: Traders can buy CECO over 33 .95
(today's high) with a protective stop under 33 .60 (today's five minute base).
The target areas are 35.24 and 35.99. Only hold this position as a swing
trade if the stock closes above 34.10; otherwise exit into close. VCM Tip: The odds of a failure of a strategy to continue
in the reverse direction are even greater than the original odds of the
original strategy working.. Management Guidelines: For swing and core trades (ETF
plays follow core guidelines) can be found at http://www.vcmtrading.com/resources.php
Today's Letter Play: VSEA met entry criteria and has
had a strong move up. Yesterday's Alert
Play: CTV met entry
criteria and just hit target one during lunch today. Please feel free to send any comments to services@vcmtrading.com Remember as always that you should not risk your own
money unless you understand and are comfortable with the position and you
have a full understanding of the risks of trading securities. Good trading everyone, and watch for the
VCM Daily Trading Letter for tomorrow... |
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Please
keep in mind that all comments made by Velez Capital Management, LLC ("VCM")
instructors and representatives are for educational purposes only and should
not be construed as investment advice regarding the purchase or sale of
securities, options, futures or any other financial instrument of any kind.
Consult with your investment advisor before making an investment decision
regarding any securities mentioned herein. VCM instructors and
representatives assume no responsibility for your trading and investment
results. Information
for the stock observations was obtained from sources believed to be reliable,
but we do not warrant its completeness or accuracy, or warrant any results
from the use of the information. The author as well as other VCM employees,
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and all "affiliated" individuals assume no responsibilities for
your trading and investment results.
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