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CHART: Nasdaq 100 and S&P 500 eMini Futures: NQh9 +105 pts & ESh9 +111 pts

In the heat of the most intense volatility we have seen in years, ChartTrader was able to capitalize with several huge trading days. A good example is his series of trades from December 27.

A highly conservative futures strategy following these trades with minimal trading size would have made $12,750 trading along with ChartTrader on this day alone.
09:33 ET CHART ChartTrader: Buying some NQ's at 6175 at half size, risking 20 pts
09:38 ET CHART ChartTrader: NQs long update -- Scalping a piece for about +40 pts, stops to entry on remaining
09:48 ET CHART ChartTrader: Out of rest of NQ's long for scratch on reversal off early highs
09:57 ET CHART ChartTrader: Buying some ESh9 at 2422 on 1/4 size, risking 25 pts
Getting long the S&P small and wide here with a target zone in the 2500-2515 area as shown on my chart in the ETFXX comment a few minutes ago.
10:10 ET CHART ChartTrader: Scratching ESh9 long here and will look at it again in a bit
10:27 ET CHART ChartTrader: Back long ESh9 at 1/2 size with 10 pt risk from 2419
10:52 ET CHART ChartTrader: ESh9 (S&P) long update -- stops to 2416 on the +17 pt move into the money
11:29 ET CHART ChartTrader: ESh9 (S&P) long update -- Banking a little bit here for about +19 pts
12:03 ET CHART ChartTrader: Out more of the ESh9 here for about +10
Still have a little on, but generally not liking the feel of this tape, particularly in the Nasdaq. Starting to feel like a short from here.
12:30 ET CHART ChartTrader: Spiked down out of the S&P long just under scratch on what looks like something headline-driven, but haven't spotted the culprit yet
13:02 ET CHART ChartTrader: Shorting some NQs at 6132 at half size, risking 20 pts
13:19 ET CHART ChartTrader: NQ's short update -- Stops to 6136 on the +15 pts move into the money
13:43 ET CHART ChartTrader: NQ's short update -- Scalping a piece for about +25 pts
13:46 ET CHART ChartTrader: Banking more of the NQ's short here for about +35 pts
13:49 ET CHART ChartTrader: Banking half of remaining in NQ's short here for about +50 pts
13:52 ET CHART ChartTrader: Closing rest of NQ's short for +60 pts on last piece
14:29 ET CHART ChartTrader: Buying 1/4 size position long ESh9 at 2405, risking 20 pts
14:52 ET CHART ChartTrader: ESh9 long update -- Stops to 2395 on the +20 pts move into the money
Looks like we maybe caught this one coming and going today. Would like to see this through to 2500 squeeze flush tomorrow or Tuesday if possible.
15:27 ET CHART Scalping half of the ESh9 long here for about +50 pts, will leave the other half on for a shot at 2510 tomorrow
If you're wondering what I saw to do this today...
There were two ideas. First, the target is painted on 2500 for this bounce in the S&P as I see it. The sentiment imbalance we had at the lows was too one-sided to be dealt with in a single day of popping higher. Second, we started off early with proof that sellers were going to try to take control again this morning. So, that had me looking for points where I might buy into an early dip for the run-up to 2500 after an initial shakeout. We got that and I caught a nice 25 pt pop in the market. But the move lower off that high was not in character with a strong tape. It looked like big sellers were still at work and the bid side was small, weak-handed players looking for yesterday's momentum to show up again. So, the market started to feel like it was filling up with that type of money and I got the sense that we needed to wash it out with a dive under 6100 in the NQs to bring 2400 into play in the ES. So I shorted NQ's but didn't waste time covering once we had "puked out" all of the weak money and hit the levels. From there it was just a matter of time watching that little panicky dive exhaust itself before I got back long ES from a better level. As we head toward the close, the real rebal bid is showing back up and I will be holding overnight and looking for 2500 tomorrow. Sitting up about 50 pts on it now.
16:10 ET CHART ChartTrader: Well fine then... I won't wait until tomorrow if it just wants to give me 2500 today... Banking the ESh9 here for about +92 pts
Quite a day. No Asia and EU risk now either.


"CHART: Just wow man thank you. The risk mgmt and setups made 26 & 27 my biggest days of the year."

"As they say to the matador in Spain at the end of a superb bullfight, 'Two ears and a tail.' Bravo!"

"Utterly brilliant thank you."

"CHART Awesome trading day!!! Thanks!"

Dow Jones eMini Futures (YMh9): +100 pts

On January 28th, ChartTrader took advantage of the volatile morning action, getting involved on the short side in the Dow Jones emini futures market (YMh9) for as much as 100 pts into the money and booking pieces at +50 pts and +90 pts along the way.
11:14 ET CHART ChartTrader: Shorting some Dow futures (YMh9) at 24395 risking 50 ticks
11:40 ET CHART ChartTrader: Dow futures (YMh9) short update -- Scalping a piece for +50 pts, stops on the rest to 24420
See 11:14.
11:56 ET CHART ChartTrader: Banking more of the Dow Futures (YMh9) short here for about +90 pts
13:42 ET CHART ChartTrader: Note, stop was hit on remaining piece of YMh9 short on the bounce


"CHART very nice trade on YMh9. Thanks for posting."


S&P e-Mini Futures (ES H19): +45 pts

Immediately after the Jobs report hit we saw futures dive lower. The idea that a strong round of results would lead to a more aggressive Fed and a policy mis-step.

But Event Trader was able to catch a changing tide in momentum and found the S&P e-mini futures holding support at the 2475 level.

This led him into a long in these futures that would eventually rally 45 points (Approx $2250 per contract) as it squeezed through key resistance levels.
08:37 ET
EVENT Event Trader: Entering a Long in the ES H19 here at 2475, risking 6; 1/2 size
08:44 ET
EVENT Event Trader: ES H19 thoughts- Had people leaning into the tape ahead of jobs; Saw a quick dip on the headline as most saw it as too strong and that it would cause the Fed to raise; However we held up better than I would have expected so I think we could get a squeeze here
I thought it was worth risking 6 points for a possible press towards the overnight session highs of 2486. If we get there I would be looking to skim a piece there and move stops. Basically a play to see if we have weaker hands trying to fade rallies which was so popular at the end of 2018.
09:25 ET
EVENT Event Trader: Taking a piece of the ES H19 here for 10 points; Stops to entry
10:32 ET
EVENT Event Trader: Up about 45 points and at that 2520 level in the ES H19 here; Not looking to get greedy so I am going to lock in profits here on the remaining piece; May be too early but think we are extended into some resistance; Willing to bank the profits and see how things play out around the Chinese trade talks


"Event Trader SUCH a nice trade, thank you!"

Cronos (CRON): +5%

On February 5th, Scalp Trader took a position in canadian cannabis name Cronos (CRON), and called this scalp long a "nice, easy hitter." His position took off for a 5% profit in just 20 minutes!
09:33 ET
SCALP ScalpTrader: CRON scalp Long -- Risking about 1.2 pts and starting 1/2 size. (21.07 -2.13)
09:40 ET
SCALP ScalpTrader: CRON Update -- Putting on second 1/2 of the scalp long position. (20.75 -2.50)
09:50 ET
SCALP ScalpTrader: CRON Update -- Trimming 2/3 of the position for +1 pt ... Stops to $20.91 avg entry price. (21.92)
Nice, easy hitter this morning, after stock gaps down and flushes out some momo players early, following broker downgrade.
09:52 ET
SCALP ScalpTrader: CRON Update -- Closing out remainder here for +1.30 pts (22.22)


"Just wanted to say thanks to SCALP for his trades lately and most recently in CRON. I took the trade this morning and am now able to pay my car payment for the month with that one trade which took less than an hour. Incredible. A new thing for me and I am extremely grateful. Thank you again."

Lumentum Holdings (LITE): +7%

When Apple (AAPL) came out and warned, it provided an interesting dynamic for the markets. Has this weak performance, telegraphed since early December, been priced into shares?

Event Trader decided to test this theory out and entered a Long in LITE, a key AAPL supplier that had already warned a few weeks ago.

The idea that this was double jeopardy and the stock would see a bounce back as it tested key $38 support. Event Trader was able to take advantage of it with a nice 7% return in a tough environment.

Shares of LITE have since rallied another 10% despite the AAPL warning.
11:25 ET
EVENT Event Trader: Entering a Swing long in LITE here at $39.67; 1/2 size position short term trade; Seeing if it van fill that gap back toward $42, risking $1 (39.68 -2.95)
Taking a shot at this one as I think there is some double jeopardy in play. Meaning that the stock was hit already on poor guidance due to the AAPL concerns. So willing to see if this one can bounce.
10:12 ET
EVENT Event Trader: LITE Long- Closing out for $2+ profit here as it hits our target from the Jan 3 swing long entry (41.82 +0.03)

Micron (MU): Scalp Long +10%

Event Trader took advantage of the December 24 sell off by jumping into shares of MU. The stock was hit hard in late December on its earnings and, more importantly, its guidance.

But the $30 level held up well suggesting sellers had reached some exhaustion. It was an early tell on what we would see in the AAPL response as well as Citigroup© on January 14.

Event Trader has been able to hit a nice 10% return on his trade as shares of MU break out of a downward trend and press towards a key test of resistance at its 50 moving average.
10:48 ET
EVENT Event Trader: Entering a scalp long in MU here at $31.10; 1/2 size piece; Like the name on a bounce back as it has been holding that $30 level despite a tough market and some awful guidance; Stops at $29.80; target is $35 area (31.19 +0.30)

Commodities Trader: Recent Oil & Gas Plays

Following the 44% collapse in oil prices that occurred in the fourth quarter of 2018, oil and oil stocks went on our Commodities Trader's long radar. Given that a large part of the plunge in oil wasn’t fundamentally justified, he began to look for a bottom in oil prices in the mid-to-low $40’s as well as a reversal in oil stocks.

Oil prices appeared to be bottoming in late December, so Commodities Trader began looking to get long some beaten up oil stocks that he felt were oversold. With the sell-off in oil and the market recently, in addition to the ongoing build-up of oil and gas wells that are finished but need to be completed in the U.S., he's had a focus on the oil and gas equipment and services industry (names such as SND, SLCA, EMES), in addition to producers (such as SM).
Smart Sand (SND): +12% (avg. profit)
12:16 ET
CMDTY Commodities Trader: SND Long Position Update (2.62 +0.10)
  • Following recent/today's price action, I'm closing 1/2 of my SND long here at a gain of $0.24 (+10%)
  • I'm also going to move my stop to my entry point
15:38 ET
CMDTY Commodities Trader: SND Long Position Update- closing out (2.71 0.04)
  • I'm going to close the last 1/2 of my SND long for now at a gain of $0.33 (or +14%)
  • However, let's also keep this oil and gas proppant name on the long radar for a new entry soon
  • I'm still long SND's peer SLCA

SM Energy (SM): +7% (avg. profit)
09:46 ET
CMDTY Commodities Trader: SM Long Position Update (16.05 +0.73)
Closing 1/2 of my SM long for now for +$0.90 following morning action. Also moving my stop to my entry point
11:20 ET
CMDTY Commodities Trader: SM Long Position Update- closing out (16.38 +1.06)
  • Given the level of volatility in the market currently, holding certain stocks as swings can be tough, especially in the energy space
  • Given that, for now, I'm closing the last 1/2 of my SM long for +$1.23 (+8%)
  • I like the long idea here, I just don't want to whip back and give up half my gains
  • I know I could trim and trail, which I love to do sometimes, but I only like to apply that method to stocks with lower betas and lower ATRs
  • SM is not one of those

U.S. Silica (SLCA): +11% (avg. profit)
11:40 ET
CMDTY Commodities Trader: SLCA Long Position Update (10.03 +0.11)
  • I'm going to close 1/2 of my long for now at a gain of $0.60
  • And since I won't be adding in this trade, at this point, I'm going to move my stop to my entry point
11:37 ET
CMDTY Commodities Trader: SLCA Long Position Update- closing out (10.93 +0.75)
  • Following morning action, I'm closing the last 1/2 of my remaining long for now at a gain of $1.50 (+16%), only given the size of this morning move
  • However, SLCA will remain on the long radar as a favorite long idea in the oil and gas space
  • I plan on getting long again soon... just want to take profits for now

Emerge Energy Services (EMES): +17% (avg. profit)
14:23 ET
CMDTY Commodities Trader: EMES Long Position Update (1.72 +0.27)
  • Following recent price action in this oil and gas proppant play, I'm going to close 1/3 for now at a gain of +$0.27 (+19%)
  • I'm also moving my stop to my entry point, which is at $1.45
  • I initially got long at $1.50, then added once at $1.40
15:59 ET
CMDTY Commodities Trader: EMES Long Position Update- closing out (1.68 +0.23)
  • I'm closing the last 2/3 here for now at a gain of for +$0.23, or +16%, following today's price action
  • However, let's plan on getting long again on Monday... just want to lock in gains for now.

REV Group (REVG): +11%

RV-related stocks took a beating in 2018, hurt by rising interest rates, which hurts big-ticket items such as RVs that people have to almost always finance, hurt by the trade wars, as well as issues with too much inventory.

Separately, REVG then reported quarterly results on December 19. REVG clearly got whacked on a top and bottom line misses and color that notes it expects the strength of its financial results in fiscal year 2019 to be weighted toward the second half of the year, consistent with historical trends, and that first quarter 2019 will be softer than the prior year as near-term challenges persist through the end of the calendar year.

However, the stock began the year around $33/share and is now in the $7-8/share range. And the company already told us when they reported fourth quarter on Sept 20 that "due to dealer order strength experienced in the first half of fiscal 2018, we are planning for tougher year-over-year comparisons in the first half of fiscal 2019 with more favorable top-line growth rates in the second half of the fiscal year."

So when the company said "expects the strength of its financial results in FY19 to be weighted toward the second half of the year, consistent with historical trends, and that 1Q19 will be softer than the prior year as near-term challenges persist through the end of the calendar year" on December 19, given other industry data, this color shouldn't have been terribly surprising. At $8/share, Commodities Trader has kept REVG on his long radar.
10:55 ET
CMDTY Commodities Trader: REVG Long Position Update- closing out (7.67 +0.45)
  • I'm closing the last 1/2 of my REVG long for now at a gain of $0.73 (+11%) following today's price action
  • However, we should keep this one on the long radar for a new future long position

VelocityShares 3x Inverse Natural Gas ETN (DGAZ): +26%

Natural gas futures are often volatile. However, in recent weeks, it has displayed an extreme level of volatility. Wild weather forecasts came out in early November. These updated, new, weather forecasts were clearly forecasting that there would be a surge in heating demand, and therefore a surge in natural gas demand. Between 11/01/18 and 11/14/18, nat gas surged from $3.24/MMBtu to $4.84/MMBtu, or up 49.4%. Prices hung around in a relatively narrow range for a month and then between December 10 and December 31, 2018, nat gas prices fell from $4.55 to $2.85/MMBtu, as those weather forecasts didn't play out like originally expected.

In short, yes, nat gas fundamentals were bullish to some extent, but the early November rally was not expected to be sustainable. A parabolic move like that on near-term weather forecasts? Come on. No way that would ever hold. However, watch nat gas closely as over this past week, there was some very cold weather in the states with some forecasts calling for cold weather through the end of January, so with nat gas around $3.50/MMBtu, be careful. Commodities Trader wouldn't take any swing trades in nat gas at the moment.
11:19 ET
CMDTY Commodities Trader: DGAZ Long Position Update (64.15 -0.50)
  • Closing 1/2 of remaining long for now at a gain of $6.85
  • I might hold the last 1/4 overnight
09:32 ET
CMDTY Commodities Trader: CLOSING... DGAZ Long Position Update (72.06 +8.21)
  • Following the morning extension of losses, I'm closing the last 1/4 of my long here for a gain of $14.76 (+26%)
  • Even with nat gas back below $4.00/MMBtu here, I still want to keep this name on the short radar for now


"DGAZ - Great call. Thank you Commodities Trader!"

VelocityShares 3x Inverse Natural Gas ETN (DGAZ): +4% in each DGAZ long

As noted in the above DGAZ trade, nat gas has recently displayed an extreme level of volatility. Given that, the changing near-term weather forecasts, all on top of nat gas still trading at a relatively high level compared to prior months, Commodities Trader continues to hold nat gas on the short radar as he believes there are scalp trading opportunities in the near-term. Jan 17 was a nice day as he got to sneak in two quick day trades in DGAZ, each gaining 4%. Two separate longs, each banking 4% in one day is not bad at all. DGAZ is an inverse nat gas ETN, so by getting long DGAZ, he's shorting nat gas futures.
10:40 ET
CMDTY Commodities Trader: DGAZ Long Position Idea, spec trade, so smaller overall position sizing, not holding overnight (68.19 -3.07)
  • I'm taking a long position here in DGAZ (VelocityShares 3X Inverse Natural Gas ETN linked to the S&P GSCI Natural Gas Index) following morning strength
  • Nat gas was seeing some weakness yesterday after weather forecasts have improved a bit following very bullish forecasts over the weekend
  • Nat gas rallied this morning, but has been sliding lower since and I can see weakness continue for the moment
  • I will NOT be holding this overnight
  • Feb nat gas is now +$.10 at $3.48
11:17 ET
CMDTY Commodities Trader: DGAZ Long Position Update (71.19 -0.07)
  • Given the recent price action, I won't be adding anything to this trade
  • So, for now, I'm moving my stop to my entry point
  • I'm also going to close 1/2 at a gain of $3.00/share
11:25 ET
CMDTY Commodities Trader: DGAZ Long Position Update (72.42 +116)
  • Closing 1/2 or remaining position at a gain of $4.23/share
12:49 ET
CMDTY Commodities Trader: DGAZ Long Position Update (67.74 -3.52)
  • I was stopped out of my last 1/4 for a scratch as nat gas reverses higher... closed for 1/2 for +$3, then 1/4 for $+4.23. I'll be looking to get back in again, maybe in a little following this recent move
13:19 ET
CMDTY Commodities Trader: DGAZ Long Position Idea, spec trade, so smaller overall position sizing, not holding overnight (69.00 -2.26)
  • I'm taking a long position here in DGAZ (VelocityShares 3X Inverse Natural Gas ETN linked to the S&P GSCI Natural Gas Index) following recent price action...I was long earlier as well
13:59 ET
CMDTY Commodities Trader: DGAZ Long Position Update (71.00 -0.26)
  • Given recent price action, mainly the speed of the move, I'm closing 1/2 here for +$2/share and moving my stop to my entry point
14:15 ET
CMDTY Commodities Trader: DGAZ Long Position Update- closing out (71.82 +0.56)
  • closing the last 1/2 of my DGAZ long for now for +$2.82
  • Let's keep this one radar for another trade again soon on either the short (DGAZ) or long side (UGAZ)


"To CMDTY - Great call on DGAZ"

"CMTDY Great DGAZ Call. Thank you."

Apple (AAPL) Options: Long Calls +12%, Short Puts +70%

With the stock beaten down nearly -40% off its October high, Blue Chip Trader was in the camp that said its “lower guidance” was already baked into price and once price showed signs of bouncing back, he believed it was worth a try on the Long side.
14:49 ET
BLUEX Blue Chip Trader -- AAPL Swing Long (147.69 +5.50)
  • Per yesterday's notes/Audio, I said I'd consider buying some AAPL if it cleared that $145 zone.
  • If you didn't get involved yet with price down approx -40% off that Oct high, I don't think its late and still like it here around $147/148. Just need to take smaller size and be willing to risk yesterday's $142 lows.
  • I suspect we'll see a gap close up to the $154 level ahead of its Jan 29 earnings report.
  • Option Buyers consider the Feb 130 Calls for less than $20 ...Options Sellers consider the Jan 140 Puts for a +$1.25 premium.
13:40 ET
BLUEX Blue Chip Trader -- AAPL Swing Long/Bounce Follow Up (151.10 +3.17)
  • Still sitting tight with this Swing Long for a gain of approx +3.50 points now as it lifts back over the $151-level.
  • If you took on size a week ago when price was trading down nearly -40% off the October peak after lowering guidance, then trimming a partial into renewed strength is warranted.
  • As I highlighted on Trader Audio a little while ago, there are at least 7 bearish gaps on the AAPL Daily chart starting in November. Now I can't say that all seven will be closed or not, but I like to think the latest one around 154.23 (Jan 2) has the best odds to do so. I don't think I'm going out on a limb to say it will do so before Jan 29 earnings either.
  • Long Feb 130 Calls +12%; Short Jan 140 Puts +70%
  • Click here for my Daily AAPL chart highlighting at least 7 bearish gaps...
12:43 ET
BLUEX Blue Chip Trader -- AAPL Swing Long Follow Up - Partial (154.00 +3.25)
  • AAPL strength today closes last week's "lower guidance" gap at the 154-zone; good for a gain of +6 points. (Long Feb 130 Calls +20% ; Short Jan 140 Puts +80%).
  • Partial profits warranted, balance stops raised towards breakeven zone.

Twilio (TWLO) Options: Long Calls +15%, Short Puts +90%

A Software Leader from our Liquid Momentum Focus List, TWLO managed to show incredible relative strength throughout the Q4 market correction, so a gap up for a potential breakout to new highs was in Blue Chip Trader's wheelhouse of set-ups.

Starting off the year with a Swing Long in a leading stock was worth the risk. The stock's price is up 6% in 2 days and still counting.
10:50 ET
BLUEX Blue Chip Trader -- TWLO Long (94.95 +6.40)
  • Buying this leading name here above the $94, risking about $5.
  • Note this is a volatile stock with less than 80-million float and a 6-point ATR these days, so position size should be minimal.
  • Overall, nice relative strength during Q4 which puts it on target for new highs above the $100 mark if strength continues.
  • Option Buyers consider the Feb 90 Calls around $13.50 or less. Option Sellers look into collecting the Jan 87 Puts for a $2 premium.
09:38 ET
BLUEX Blue Chip Trader -- TWLO Swing Long Follow Up - Partial (98.56 +1.58)
  • Banked a partial on the initial pop over the $100-mark as reward equaled risk for a gain of +$5.
  • Balance stops moved up towards breakeven zone.

Sage Therapeutics (SAGE): +23%

TrendTracker got long ahead of SAGE-217 data that confirmed its potential to be a blockbuster depression drug. The stock gapped up 48% in response to the data last week but he continues to hold and like the stock long-term.
12:35 ET
TREND TrendTracker: Buying a 1/2 size spec swing long position in Sage Therapeutics (SAGE) ahead of SAGE-217 data next month (106.93 -1.54)
Sage Therapeutics (SAGE) is a clinical-stage biotech company developing medicines to treat central nervous system (CNS) disorders.

This is a speculative long that could turn into a big winner if things play out, mostly SAGE-217 data expected in January.

Sage should get its first drug to market next year. The FDA is expected to approve ZULRESSO, the company's intravenous GABA receptor-modulating neurosteroid, for postpartum depression (PPD) early next year -- the FDA decision deadline (PDUFA date) is March 19. The FDA Advisory Committee voted in favor of the drug 17-1 last month.

More importantly, the company will report Phase III data for SAGE-217 in January -- the oral version of ZULRESSO, which would have much better market adoption. Positive results should send the stock soaring and would potentially put it on the map as a takeover target as it would bode well for the same drug in the pipeline going after major depressive disorder (MDD), a huge market. The February options imply a ~30% move in the stock.

I previously said I would stop speculating (gambling) on clinical data because I am not a scientist. Anything in the CNS space is especially difficult, but I can't help myself here.

The depression market is large and growing: MDD is the most common mental disorder in the U.S. with ~16 million American adults. So, there is huge potential.

If your risk tolerance is as high as mine, it might be worth speculating here at these levels.

SAGE shot up >60% one year ago on positive Phase 2 SAGE-217 data. The stock has retraced almost that entire move as biotech stocks have been out of favor.

Sage has a $3.9B enterprise value ex-$1.1B in cash; 7% of 45M share float is sold short.


"TREND - Great call on SAGE."

Camping World (CWH) +20%

SCALP was able to lock in an average profit of 20% in this name over the course of nine trading days.
14:07 ET
SCALP ScalpTrader: Camping World (CWH) Swing Long -- Initiating a 1/2 swing position as a value/bounce play. Risking about 2 pts and will look to add on weakness (11.57 -1.28)
  • I'm feeling that the market is setting up for a strong, short-term bounce.
  • In fact, I believe today might have been the day if not for the lack of participation due to reduced staffing on desks ahead of the holiday.
  • This is the type of name that value buyers could step in and bounce 15-25% over a week or two.
  • It also pays a little bit of a divided -- 2.4% yield. Notably, stock has been in freefall from the $15.15 traded a week ago when the stock went ex-dividend.
  • I've been seeing some very aggressive selling in a host of names after they go ex-dividend, which I think is starting to create some oppty.
  • This one has also being hit hard by recession fears. I think comments by NY Fed Pres Williams today may help soothe some fears -- at least short-term.
11:52 ET
SCALP ScalpTrader: CWH Swing Update -- Locking in profits on 1/2 of the CWH swing position for +12.5%. (13.03 +0.20)
  • This position was initiated in the Swing Portfolio on Dec 21.
  • Adjusting stops on remainder of position to the $11.57 entry price.
  • Ideally would like to see a move to the $14.50-15.00 on remainder of position.
12:22 ET
SCALP ScalpTrader: CWH Swing Update -- Locking in profits on half of remaining CWH position for +25%. Stops on last piece remain at $11.57 entry price. (14.55 +0.55)
13:38 ET
SCALP ScalpTrader: CWH Swing Update -- Locking in profits on remainder of CWH swing position for +30%. (15.07 +0.38)

Entered position in RV retailer on Dec 21 at $11.57 as a Value play and view that more dovish comments earlier that day by NY Fed Pres Williams would assuage recession fears.

VelocityShares 3x Long Crude Oil ETN (UWT): +23%

SCALP traded a bounce in Crude Oil for an average profit of +23% using the 3x Crude Oil ETN.
15:41 ET
SCALP ScalpTrader: UWT Swing Long -- Initiating a swing long in UWT here, which is the 3x Long Crude Oil ETF, as WTI plunges under $47 bbl. Starting with a 1/3 position and risking approx. 2 pts. (9.90 -2.17)
09:31 ET
SCALP ScalpTrader: UWT Swing Update -- Adding another 1/3 to the position and adjusting stops to $7.00 area. This takes the position to 2/3 normal size. (7.95 -0.27)
11:20 ET
SCALP ScalpTrader: UWT Swing Update -- Trimming 1/3 of the UWT Swing Position for approx. +11%. Stops to remainder to $8.92 avg entry price. (9.97 +1.07)
09:32 ET
SCALP ScalpTrader: UWT Swing Update — Trimming another 1/3 of UWT swing long for +15%. Stops on final piece still at $8.92 avg entry price. (10.28 +0.60)
09:31 ET
SCALP ScalpTrader: UWT Swing Update -- Taking profits on 1/2 of remaining UWT swing position for +38%. Stops remain at $8.92 avg entry price. (12.34 +1.02)
11:49 ET
SCALP ScalpTrader: UWT Swing Update -- Using this surge in Crude Oil to lock in profits on remainder of UWT swing position for +47%. (13.09 +1.77)
UWT is the 3x Long Crude Oil ETN.

ETRACS Monthly Pay 2xLeveraged Mortgage REIT ETN (MORL): +16%

A +16% capital appreciation in less than two weeks in a name that should kick off a +25% annual distribution yield.
14:55 ET
SCALP ScalpTrader Thoughts... Also, adding MORL to my Yield Portfolio, but as a Spec play.
  • We are at the point that I think price action is mainly being driven by investor fund redemptions.
  • Just this month we've already seen two of the biggest weeks of outflows from equities since 2008 (think Lehman).
  • If the full weekend of government shut-down coverage weren't enough, just as retail investors were finishing up their holiday shopping, they were hit over the head with headlines of the Pres possibly firing the Fed Chief, the Treasury Secretary rounding up bank CEOs over the weekend and a plunge in the S&P on the Christmas Eve shortened session.
  • Couple this with the passive retail investor logging into their online statement only to see the portfolio value down dramatically from where they checked it last quarter (or two qtrs ago), and you have the recipe for a mini-panic.
  • With so many people taking vacation this week, investors will have the time and the focus to cash out into money market accounts in an attempt to avoid any additional carnage.
  • And, for many who held off hitting the Sell button yesterday after the 5% surge in the S&P, today's give-back likely has them revisiting that decision.
  • This whole scenario is making me more bullish short-term and I'm already seeing a number of very interesting opportunities on the long side.
  • One group that I've been doing work on today is the Mortgage REITs... I actually started buying some MORL down here at a +25% yield. This is a 2x Leveraged REIT ETN)..The ETNs underlying holdings such as NLY, AGNC and TWO should actually benefit from recent volatility in credit, as well as the expectation that the Fed may be forced to become more dovish... MORL currently trades at $12.34. I hope to be able to sit on this for a number of years and clip the +25% "coupon). Only at 1/3 size at the moment with hopes of being able to add more into weakness.
09:42 ET
SCALP ScalpTrader: Yield Portfolio Update -- Note that MORL declared a distribution of $0.64 for the month (not qtr); we're currently in the money 14% since Dec 27 purchase & have a 5% distribution payment coming in a few days (14.14 +0.14)
  • The MORL ex-date is Jan 11 and payment day is Jan 23.
  • When declaring the distribution, UBS gave a projected annualized yield of 25.77% based on the Dec 31 close, which is about 27% from where we purchased the name on Dec 27.
  • Position is currently 14% in the money and we have another approx. 5% coming in a few days. Based on recent history, would expect price to adjust about $0.20-0.30 following the distribution.
  • Not a bad haul so far -- picking up a security at a 27% yield that has already given 14% in capital appreciation just 8 trading sessions after buying it.

Teekay Offshore (TOO): +24%

12:32 ET
SCALP ScalpTrader: TOO Spec Position Update -- Going to lock in profits on 1/3 of the TOO Spec Swing Position for a profit of +24%. Stops on remainder to the $1.18 entry price (1.47 +0.08)
As I noted at time of Dec 26 entry, I thought TOO was largely a victim of tax-loss selling and that felt it would bounce sharply when either Oil prices recovered some off lows or broader markets began to stabilize.

Direxion Daily S&P Biotech Bull 3x ETF (LABU): +32%

12:27 ET
SCALP ScalpTrader: LABU Update -- Going to trim 1/3 of the LABU swing trade on the +12% move. Tightening stops to $25.80 entry area. (28.98 3.76)
15:58 ET
SCALP ScalpTrader: LABU Update -- Closing out another 1/3 of LABU position for +20%. Stops on final piece at $25.80 entry. (30.87 +5.66)
  • Wow, that is some move across the markets today.
  • LABU is posting a gain of 21%, while S&P 500 is up 4.7%.
  • Don't see moves like this often. When you do, it typically means there will be more volatility ahead.
  • Taking advantage of price surge to scale out more position, on expectation that I'll be able to add again at lower prices.
09:39 ET
SCALP ScalpTrader: LABU Swing Update — Locking in profits on last piece of LABU swing long for +32%. (34.20 +2.47)


"Scalp--great calls on LABU today--thanks"

"Scalp-Thanks for the LABU defintely was the greenest today in percentage terms...I am out from 25 on 1/2 position...holding other half"

Direxion Daily S&P Biotech Bull 3x ETF (LABD): +5%

Scalp Trader recently put on a nice intraday scalp for a +5% average exit.
SCALP LABD -- I'm going to put on a 1/2 position LABD long here (3x Short Biotech) on prospect of Biotech/Market dip off these highs. Risking about 1 pt. (25.58 -1.55)
10:26 ET
SCALP ScalpTrader: LABD Update -- Trimming 1/3 for +0.65. Stops to entry on remainder (26.22 -0.91)
10:41 ET
SCALP ScalpTrader: LABD Update -- Trimming another 1/3 for approx. +1.15 pts. Stops remain at entry on last piece. (26.75)
15:49 ET
SCALP ScalpTrader: LABD Update -- Locking in profits on last piece of the LABD for +1.70 pts. (27.28 +0.15)


"Scalp--great call this AM on LABD--the easiest $1.10 I ever made--thanks"

"Damon thanks for the great trade in LABD."

Pyxus Int'l (PYX): +20%

12:12 ET
SCALP ScalpTrader: PYX Swing Long -- Getting back into Vaping/Pot play with a 1/2 swing Long. Risking about 1.5 pts. (12.17 +0.51)
  • Strong bid under market should start to see money flow back into beaten-down small cap names.
  • PYX mkt-cap is approx. $110 mln; enteprise value approx. $1.5 bln.
14:37 ET
SCALP PYX Swing Update -- Raising stops to $12.17 entry price following the +10% move into the money. (13.49 +0.89)
14:38 ET
SCALP ScalpTrader: PYX Swing Update -- Taking profits on 1/2 of PYX swing position for +20%. Stops on remainder at $12.17 entry. (14.63 +1.09)

Tilray (TLRY): +5%

09:38 ET
SCALP ScalpTrader: TLRY Scalp Long -- Risking about 3 pts and starting 1/2 size. (82.95 -2.69)
10:05 ET
SCALP ScalpTrader: TLRY Update -- Trimming 1/3 for +1.7 pts. Stops on remainder to entry area. (84.77)
10:15 ET
SCALP ScalpTrader: TLRY Update -- Trimming another 1/3 for +3 pts. Stops on last piece at entry. (86.10)


"The Best of Briefing Trader. TLRY stock began the day lower. With very little as a catalyst this morning Scalp calls a long in TLRY, at about 83.00. The stock lingers around for a little while and suddenly spikes up three bucks to over 86.00 a share. Scalp calls two profit trims along the way with stops on the balance at breakeven. TLRY may likely trade down on the day; but Briefing traders still made money on the long side. Great job."

Tech Trader's Covered Shorts

Tech Trader covered all his remaining Shorts between Christmas Eve and the first hour on December 26th, which almost perfectly marked the bottom of the sharp Q4 market selloff. See his posted note below.
12:45 ET
TECHT Tech Trader: Quick Note, Covered All Shorts
So just a quick note here to say that between Monday and Today, I've covered all my shorts. It's never possible to perfectly time these but I feel holding them until the last 2 days served me as well as I could do. Of course I now wish I had followed through with bigger shorts on my massive Bearish FANG call which I've warned about all year (been posting and doing Briefing Radio interviews about it all year since the January highs).

However, there's no such thing as trading/investing perfection. It doesn't exist and everything that's already occurred is in the past and can't be re-written. Thus I either learn what I can from the past or I simply forget about it. If someone is lambasting themselves (and others) for not having sold 100% of the longs at the YTD or ATH highs and covering 100% of all shorts at the YTD lows -- well simply put that's loser trader mentality and something I don't entertain.

I'll looking to entering new/fresh shorts into higher stock prices. If we keep going lower I'd rather stay in cash or keep nibbling. As just like I wasn't buying a single one of the FAANNG's and FANG Contingent (FB AAPL AMZN NFLX NVDA GOOGL) -- At the Highs. I'm certainly not going to be increasing shorts after a 30% decline in the Russell 2000 Growth Index and an average of 41% decline in the FAANNG's I listed above. If I short it will be into higher (not lower) prices.

No Pos. -- in above stocks mentioned

Tech Trader: Mother of all January Effects

Tech Trader has emphasized the potential for huge January Effect trade numerous times on various Trader Audio interviews. On December 12th he posted a favorites list, and as expected, the names on the list surged higher in January.
14:39 ET
TECHT Tech Trader: January List Top 5
To fulfill my request on Trader Audio here's my Jan. Effect List Top 5:

SPOT -- SPOT's 9% ownership in TME (the music IPO for TenCent), is a catalyst here but the main catalyst is the $70 decline in shares from SPOT's highs.

WDC -- Of all the names in this list WDC is prob. also the best LT investment call in my view. I always like it when I can buy an oligopoly name on a 63% off sale.

CBLK -- Already highlighted this name but just a look at this chart as it's been a crazy, better said, it's an "almost perfectly sloped" decline from 22-24ish. And when I find these "perfectly sloped" declines it tells me one thing -- Machine Selling. That plus this is one of the cheapest Cyber names in my coverage universe makes it an easy pick.

SWKS -- AS I told Jim today, this really could be MU, SWKS or CRUS. But I'm leaning towards SWKS as it's my favorite of those 3 names. That said, if this "trade" works, then I'll be shocked if all 3 names don't work and to a similar magnitude of upside. as a long over AAPL for a variety of reasons which are too long to get into here. Suffice to say, I used to strongly favor AAPL over the AAPL suppliers. I now think just the opposite and favor many/most AAPL suppliers over AAPL and have for at least a few months already and when AAPL was at much higher prices.

MU -- Ditto to SWKS.

IIVI -- Prob. the easiest stock to put in this list is IIVI. First you had one of best earnings reports of last QTR (stock spiked to $48), then you have one of the great M&A gifts of all time in buying FNSR at the agreed upon price and lastly you have -- yes the tax loss selling as a former winner becomes a YTD loser. In fact, this reminds me a lot of the Elpida uber cheap grab by MU, or the very attractive and accretive SNDK deal, which WDC above purchased. Both of those worked out tremendously for the acquiring companies.

Honorable Mentions: There's almost too many to mention but here's a few more Jan. Effect picks -- RDFN SWIR CRTO CLDR GRPN. On my "Jan. Effect" metrics for inclusion any of these could be swapped with the 5 above. Again, this year is a very target rich list of cheap stocks. The only issue is when does "Risk Off" end and become neutral to Risk On again.

If like 2016, the Risk Off trade continues into the next year then we obviously won't get that upside juice by simply flipping the calendar to a new year. That said, I pick Jan. Effect picks every year and have been doing so since 2005 if not earlier. And the notable thing about incredibly cheap/undervalued stocks is that the majority of them eventually bounce and trade closer to their intrinsic value. And even as nasty as the start of 2016 was, the "Jan Effect List" picks still lost less value than their much more expensive peers.

Moreover, when we flipped to Risk On in 2016 we saw a huge performance catchup. In fact, many names like DWRE & MKTO (DemandWare and Marketo), immediately come to mind for putting in huge upside moves. In their case, it was due to M&A, but many ended up moving up as earning expectations got far too low. Think of names such as SPLK DATA and NOW in this case.

Long -- spot cblk iivi fnsr rdfn swir cldr grpn
13:37 ET
TECHT Tech Trader: Tech Vibes -- Jan Effect Surging
Just absolutely GORGEOUS action in my Jan. Effect thesis and list.

Nasdaq -- So we are now 650 Nasdaq's higher off the Xmas Eve lows. I think the minimum move higher is to 7500, or another 700ish higher. I still have no clue what the Bear's/Sellers were rationally thinking at NAZ 6190. And that's because they were not rationally thinking. Best guess is they were yelling "Bonzi" as they leapt off the cliff.

NFLX -- So I finally saw Birdbox. Wasn't impressed. Great bounce here and whenever the NAZ above is back with 100 or so points of the 7500, I'll be looking at it for potential shorts.

TWLO -- Ditto to NFLX... but again, no hurry as I don't think shorts will work at all until Mr. Market is notably hihger. Until then, any shorts should likely get steamrolled even in the most highly valued names. I'd also note that a firm or two has "bulled" this name as a 2019 top pick. This feels exactly like those "NVDA Top Picks" last year. Those ended up with out ... well pretty much horridly. I think TWLO is much more likely becoming a peak EPS play just as I called on for on both NVDA and AAOI last year among other names.

QCOM -- Lining up my next buys on this name and they will likely come into the next down days we get. Given my current positioning with so many Jan. Effect names ripping I have ZERO interest in chasing anything. Just as there was no way I was going to sell anything into the lunatic free fall late in the year.

MU -- Rare "smart upgrade" on this one. The only issue I have with MU is that since mid-October, SWKS has dropped from the low $80's to $65ish. MU is essentially at the same price. Some may like that MU has held better. I don't, I'd rather take the big drop in SWKS and now rank it ahead of MU. That said, I like and could easily be long either/both names.

SYNA -- I got a couple questions on this lately and the easiest way to describe SYNA is that this is one of the stocks that got absolutely nothing out of their last couple reports last year which I viewed quite positively. In fact, SYNA seems to be acting much like FEYE. There's always some stocks which don't respond to good reports and other positives. Esp. given a year like last year. Where all the upside was largely FAANNG driven and then when that group flipped to disaster it was the tide that took everything out with it. This same thing occurred in 2016, 2011/12 and bigger selloffs.

I'll remind that LITE and NVDA's huge moves occurred out of very similar conditions from the 2016 lows. Both were reporting fine in late 15 and early 16 but those stocks were compressed due to market conditions. And then when Mr. Market came roaring back and LITE/NVDA kept reporting well their stocks were exorbitantly rewarded with far greater upside vs. the Market's.

I suspect quite a few names (such as SYNA, RDFN, FEYE, COMM and many others) will exhibit similar setups out of the very beaten up small/mid cap areas which hadn't been rewarded last year and possibly not rewarded for a string of years.

Bottom line, I'm willing to ride quite a bit more upside before selling much of anything. As I said, I don't see a recession, in fact we could see acceleration. I do think the Xmas Eve lows could prove quite sticky, as noted that I covered all my shorts on Xmas Eve and the morning after Christmas -- see TECHT Post on Dec. 26th. And time will tell but I think we will see plenty of good reports out of much of my coverage universe (that I like as longs).

The only thing I'm still wary of is too much ST enthusiasm out of the FANG's... IE., note NFLX's huge move higher as well as I'm already seeing some very elevated sentiment readings already. To this point, NYMO is posting a 104 reading as I finish this note. Thus, some sharp "out of nowhere" selling could come knocking and wouldn't need much of a reason. Volatility will likely remain elevated through most of Q1 and that's why I'm completely willing to wait for day downs to add to new or existing longs.

Long -- aaoi qcom syna feye rdfn comm

Tech Trader: The Last Thing I'm Going To Do Is Sell

On December 21st, Tech Trader highlighted historically low negative Sentiment, thus moving to position for a notable turn higher in stocks, after Algo/Tax-loss selling was over.
12:41 ET
TECHT Tech Trader: Tech Vibes, Merry Xmas NOT
Every bounce gets sold, every lift gets raided and there's no catalysts for higher stocks prices. Or so the media hubbub would have us believe. Don't get me wrong, this is very very "UN-MERRY" action ahead of Christmas and to close out the year. However, I always strive to see both sides.

The negatives:

1. There's certainly a "slowdown pulse" and man alive do "raid trades" work. This attack on TWTR is pretty shocking in how much teeth it has. But how much Econ. deterioration "hasn't already" occurred. The EEM's, China and the EU has been bouncing along the bottom all year if not more than a year. I don't see much new here frankly. The question is when does the Market quit caring about it again or when do some Econ. numbers get better. More on this below.

2. Tax loss selling is also just super strong. I said, tax loss selling would be vicious this year, but it's even stronger (and lasting longer) than I thought it was going to. Moreover, it can continue through the end of December, though it should be easing up already and T+3 should also quell it to a large degree. However, in 2012 I remember tax loss selling on quite a few names running literally into the waning hours of that year.

Moreover, my view is this tax loss selling is working in conjunction with the current buyers strike which is all aiding the Algo's in driving stocks lower.

3. Are we baking in a lot of earnings misses for the coming QTR? I would think so, esp. given the price action out there. But that's def. a concern at this point.

4. China trade. We don't have a deal yet that simple. But again, how much negativity have we already baked in.

5. The all important FED. I still don't think the FED was hawkish at all, but obv. Mr. Market disagrees with me so far.

So let's boil that all down and see if there's any positives and in my view what matters the most.

1. ECON -- This is prob. the item which is causing the "least impact." However, my view that several economies (notably China) are starting to try and stimulate. Much more global stock damage and it's likely the stimulus pulse starts forming again.

2. Tax losses -- Hey firms, retails and the machines are taking them or pushing them. This effect does have a firm end date.

3. EPS Reports -- My view is actually much like last QTR. I wasn't super enthused on that many reports. But firms like TWTR, CLDR (and select Cloud names), Fiber Optics like ACIA, and the emerging 5G catalysts should produce reports similar to last QTR and these were all most of the best reports of last QTR. I wasn't bullish on the FANG's and very few is any expensive stocks. I fully expected great reports out of OKTA, WDAY, NOW and PANW but I didn't want and still don't want to be long any of those name yet. PANW would be the closest to levels I would consider being long.

4. China Trade -- We won't know the outcome of this until we do.

5. The FED Effect -- Well we just had Williams on today and guess what? I thought he said exactly the same thing that Powell did, yet the Market liked it more. Some of this stuff you just can't make up folks. LOL

6. Sentiment -- I'll post a chart with this piece and simply put Sentiment is so bombed out that on many measure now we are below 2011 and 2016 readings and both of those 2 "Sentiment Lows" were almost as nasty as the 2008 bottom.

So in closing with regard to this chart. It's pretty clear that at all these periods, "Selling" wasn't a good idea. We can still go lower but when I see Sentiment readings like this the last thing I'm going to do is Sell.

So on this chart, we can see the % of Stock above the 150 Day on the Nasdaq was just 11%, and only 13% all of stocks were above the 200 MA. That's a lower reading then we saw at the lows for both 2016 and 2011. Again, not a good time to sell stocks. Interestingly, we are really not that far away from the March 2009 lows. The lowest I've ever seen this reading was at the 2008 lows, not in March 2009.

As for buying stuff, I'm holding off on most things until I see the early turn trade. At a minimum I want to see stock at least breaking 5/10 EMA's on 15min and 30min charts. The 1 or 2HR charts are even better. Better yet would be stocks showing they can retake 3 and 5 EMA's on daily charts. That's where my buyside aggression will increase notably.

Percent of Stocks Above 50, 150 & 200 Day MA's

Long -- twtr cldr acia (and plenty of other stocks getting hammered)

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