It's been a long time coming... my students have been begging...
Forums are buzzing...
The Financial Puzzle 2009 Stock Picks are coming Thursday!
What is the list?
There are 6 key criteria that each of our picks must meet:
1) Good volume and good open interest.
2) Optionable
3) History of predictable Trading Patterns.
4) Good Trading Range with Good Profit Potential (at least $10/share)
5) Sector with some sort of excitement
6) Room to bust a good move.
Will your favorite stocks make the list? Will they even stack up?
Find out on Thursday...
In the meantime be sure to sign up for our Once In A Lifetime Offer where we are allowing 97 students to take our Foundations of Stocks and Options class for free. Be sure to sign up!
Tuesday, January 27, 2009
VMW - A Good Trade Setup
In preparation for my new 2009 stock picks report I've been trolling through several old stocks I use to trade. VMW is one of them and while I haven't traded it for a while I thought it might be fun to take a look at it again. Sure enough a pretty decent trade is set up for us. Look at this chart:
Okay, so what make a good trade setup? Well first of all consider the over all market. The market as a whole is forming a triple bottom. This is a good thing as triple bottoms generally (almost always) follow through with some sort of bull rally. Since the over all market is forming triple bottoms one can also assume many stocks are forming them as well. An analysis of several stocks will show a common pattern of triple bottoms with the last bottom not quite making it back down to support. It looks like that's what we have here with VMW.
Why? First of all the last 4 days (before yesterday) showed a testing of support. Not the support we saw tested back in Dec, but it held 4 days in a row and could easily follow the pattern so many other stocks are following right now.
Secondly, yesterday's large doji day indicates the interest in pushing this stock higher is good. Granted we have some earnings news playing in the picture which was a bit intimidating for traders, but the fact we didn't break support of the last 4 days is a strong sign.
Thirdly the bullish engulfing candle from Friday indicates a potentially good strong bullish move in the next 2-4 days.
And finally the indicators are all turning relatively bullish on this stock confirming we could have a good bullish run coming.
So where will it go?
Well worst case we're looking at one more level of retracement back down to the $18 range - that's about a $4 move down. With some good cheap options you could make some quick money on that. But the much better and more likely move would be the bullish move up. If we can get some confirmation of the bullish move in the form of good volume and a price follow through above yesterday's high we are looking at a first level move up to about $27.50 and a secondary move up to $32. That's a minimum and on up to a potential $10 move that could easily occur in the next 2-4 weeks.
When? Give it a day or so to watch the earnings news fully kick in. I think today traders are a touch skiddish because of VMW's forcast for lower revenues - but come on everybody's forcasting lower revenue and everyone knew it was coming. When traders realize this stock is going to hold it's support the move should happen pretty quickly.
If this analysis sounds exciting and you would like to be able to do the same analysis on any of your stocks sign up for my Foundations of Stocks and Options Course - We're letting 97 students into our February class free!
Okay, so what make a good trade setup? Well first of all consider the over all market. The market as a whole is forming a triple bottom. This is a good thing as triple bottoms generally (almost always) follow through with some sort of bull rally. Since the over all market is forming triple bottoms one can also assume many stocks are forming them as well. An analysis of several stocks will show a common pattern of triple bottoms with the last bottom not quite making it back down to support. It looks like that's what we have here with VMW. Why? First of all the last 4 days (before yesterday) showed a testing of support. Not the support we saw tested back in Dec, but it held 4 days in a row and could easily follow the pattern so many other stocks are following right now.
Secondly, yesterday's large doji day indicates the interest in pushing this stock higher is good. Granted we have some earnings news playing in the picture which was a bit intimidating for traders, but the fact we didn't break support of the last 4 days is a strong sign.
Thirdly the bullish engulfing candle from Friday indicates a potentially good strong bullish move in the next 2-4 days.
And finally the indicators are all turning relatively bullish on this stock confirming we could have a good bullish run coming.
So where will it go?
Well worst case we're looking at one more level of retracement back down to the $18 range - that's about a $4 move down. With some good cheap options you could make some quick money on that. But the much better and more likely move would be the bullish move up. If we can get some confirmation of the bullish move in the form of good volume and a price follow through above yesterday's high we are looking at a first level move up to about $27.50 and a secondary move up to $32. That's a minimum and on up to a potential $10 move that could easily occur in the next 2-4 weeks.
When? Give it a day or so to watch the earnings news fully kick in. I think today traders are a touch skiddish because of VMW's forcast for lower revenues - but come on everybody's forcasting lower revenue and everyone knew it was coming. When traders realize this stock is going to hold it's support the move should happen pretty quickly.
If this analysis sounds exciting and you would like to be able to do the same analysis on any of your stocks sign up for my Foundations of Stocks and Options Course - We're letting 97 students into our February class free!
Monday, January 26, 2009
"Jeremy . . . You're Crazy!"
That was exactly my reaction to Jeremy's idea for our big launch - to give away our Foundations of Stocks and Options live class to nearly 100 students! Here I thought we were developing a business model, but Jeremy's been thinking of a non-profit strategy all along!
For those that don't know -- The Foundations of Stocks and Options (FOSO for short) is our flagship educational series that's taught live in a webinar format. We've been beta testing for a while now and have had amazing responses from our students. I think Dr. Fred Kleiner's was my favorite, though:
And that is exactly what we want to be about. A laid back, no-nonsense approach to the stock market . . . and it sounds like our students are getting that.
So, I've agreed to let Jeremy have some fun and completely fill up our first "official" class (our webinar provider is going to love us for that!). I would love to see you guys there and maybe get a chance to talk live for a change. Sign up right here and it will bypass our checkout system (use the promo code: BLOGGER). Also, please feel free to pass this post on to anybody you would like. Trading is always more fun with a friend and -- this is a great time to take advantage of Jeremy's benevolence and get in for free! Lastly, we added a handy "share this" icon at the bottom of the post if you feel like broadcasting our post to the world -- we'd appreciate it!
For those that don't know -- The Foundations of Stocks and Options (FOSO for short) is our flagship educational series that's taught live in a webinar format. We've been beta testing for a while now and have had amazing responses from our students. I think Dr. Fred Kleiner's was my favorite, though:
"I really like how you make the concepts so clear and easy to understand. Having studied this before I have never had these concepts taught in such an easy, clear, and straightforward manner."
And that is exactly what we want to be about. A laid back, no-nonsense approach to the stock market . . . and it sounds like our students are getting that.
So, I've agreed to let Jeremy have some fun and completely fill up our first "official" class (our webinar provider is going to love us for that!). I would love to see you guys there and maybe get a chance to talk live for a change. Sign up right here and it will bypass our checkout system (use the promo code: BLOGGER). Also, please feel free to pass this post on to anybody you would like. Trading is always more fun with a friend and -- this is a great time to take advantage of Jeremy's benevolence and get in for free! Lastly, we added a handy "share this" icon at the bottom of the post if you feel like broadcasting our post to the world -- we'd appreciate it!
Sunday, January 25, 2009
Week In Preview - January 26-30, 2009
Well it's Sunday night. It's time to take another look at what's coming down the pike for the week. Let's start with the chart as pretty much everything you need to reference is on this one image.
Okay - so things are looking a little uh - flat - shall we say? You always here me say the market can go up, down, and nowhere at all. After the volatility of the last couple months I think most people are pretty pleased with a no-direction market. Frankly with the new president taking office I kind of half expected to see some movement. But maybe the country is just standing still waiting to see what his first big moves will be... who knows. Let's look at what the chart is telling us.
For starters the most important thing about this chart is the support lines drawn off the low back in Oct. 2008. That support was basically confirmed 4 days in a row this week. Not only that we have the tops of those days forming a pretty decent descending wedge. Occurring where it does on the chart I take this to signal a potential bottom. I'm not going to be surprised to see this guy bust a bull move in the next few days - probably tomorrow.
Here's my reasoning:
1) 4 days in a row confirming support
2) Tuesday/Wednesday formed a candlestick tweezer
3) Thursday/Friday formed a small wedge
4) All of this is occurring at the major support line which coincides with the long candle day from Oct. 10, 2008.
5) Thursday/Friday both had long lower wick candles indicating some strength from the bulls could be mounting
6) Wednesday, thurs, & Friday could look a lot like a falling three candle pattern. Remember it doesn't have to fall with 3 days in the middle to basically mean the same thing. Monday, Tuesday, or Wednesday could easily bust a bull move and complete this pattern indicating a pretty decent little bull trend is likely. (If you remember the falling 3 is the same candle pattern I recognized and wrote about back in Sept. predicting the October bear trend - only it was a falling 3 instead of a rising 3)
All of that to say this week should be pretty interesting. I'm pretty confident we're going to see some movement one way or the other this week. I would tend to expect bullish - but if we break that support line we could certainly drop down another notch to establish a more solid support around 7500.
I'm going to continue trading pretty flat strategies this week, although I may throw in a couple bullish trades if things set up well. As always it will be interesting (and fun!)
As always, happy trading.
J-Dub
Okay - so things are looking a little uh - flat - shall we say? You always here me say the market can go up, down, and nowhere at all. After the volatility of the last couple months I think most people are pretty pleased with a no-direction market. Frankly with the new president taking office I kind of half expected to see some movement. But maybe the country is just standing still waiting to see what his first big moves will be... who knows. Let's look at what the chart is telling us.For starters the most important thing about this chart is the support lines drawn off the low back in Oct. 2008. That support was basically confirmed 4 days in a row this week. Not only that we have the tops of those days forming a pretty decent descending wedge. Occurring where it does on the chart I take this to signal a potential bottom. I'm not going to be surprised to see this guy bust a bull move in the next few days - probably tomorrow.
Here's my reasoning:
1) 4 days in a row confirming support
2) Tuesday/Wednesday formed a candlestick tweezer
3) Thursday/Friday formed a small wedge
4) All of this is occurring at the major support line which coincides with the long candle day from Oct. 10, 2008.
5) Thursday/Friday both had long lower wick candles indicating some strength from the bulls could be mounting
6) Wednesday, thurs, & Friday could look a lot like a falling three candle pattern. Remember it doesn't have to fall with 3 days in the middle to basically mean the same thing. Monday, Tuesday, or Wednesday could easily bust a bull move and complete this pattern indicating a pretty decent little bull trend is likely. (If you remember the falling 3 is the same candle pattern I recognized and wrote about back in Sept. predicting the October bear trend - only it was a falling 3 instead of a rising 3)
All of that to say this week should be pretty interesting. I'm pretty confident we're going to see some movement one way or the other this week. I would tend to expect bullish - but if we break that support line we could certainly drop down another notch to establish a more solid support around 7500.
I'm going to continue trading pretty flat strategies this week, although I may throw in a couple bullish trades if things set up well. As always it will be interesting (and fun!)
As always, happy trading.
J-Dub
Monday, January 19, 2009
Our Story... The Launch of The Puzzle!
Hey guys -- Sorry the posts have been a little sparse recently. Jeremy and I have been really consumed with officially launching The Financial Puzzle - but that's actually great news for you. We have developed an amazing amount of resources in a relatively short time (literally hundreds of pages of material.) Much of this is going to be offered for free! We are also developing strategic relationships with other key companies to help us facilitate our teaching -- and your success as traders. I thought it would be appropriate however, to pause for a moment and reflect on how we've arrived here.
The Financial Puzzle really began over 12 years ago when Jeremy and I first met in college. In our friendship, Jeremy has always been known to have ideas that were "bigger than life," and I've always acted as the "facilitator." This has worked out well and together we've accomplished amazing things in life. Typically this is how one of our ideas is conceived.
"Hey Josh, I had this crazy idea..."
Ilisten carefully while immediately figuring out the viability of the crazy concept. Typically this occurs while drinking Dr. Pepper (I don't think it's scientifically proven, but we think it makes us smarter.) After careful consideration and a couple hours of dreaming we usually conclude as I say:
"Honestly Jeremy,I think we can do this... and if it doesn't work I'll always think it should have!"
That is exactly how The Financial Puzzle started too! Like everything else we've done, Jeremy and I decided to work together as traders. What was unique about this endeavor is that we seemed to struggle at every turn. I can remember a couple very specific times that we wanted to quit. Our frustration was consistent -- finding a comprehensive educational program that would give us all the information and tools necessary to be successful traders in an easy to understand, down-to-earth format. We knew it could be done -- obviously since people were doing it all over, and we were determined to figure out how. We endured as we gained our education from the school of Hard Knocks - which can have a very expensive tuition for traders! However, we officially graduated and the investment in our education has proven to be priceless.
The Financial Puzzle was then the outgrowth of our interactions with other traders that had a similar frustration toward education. There just isn't a product out there that is comprehensive enough to make you a successful trader in and of itself. As we've met these frustrated traders we've always been glad to share the lessons we've learned along the way. Ultimately, our contacts spread across the country (literally from California to NY), and we found the webinar format to be the most convenient tool to facilitate our teaching. We have since gone through and systematically developed our comprehensive trading educational series: Foundations of Stocks and Options. We are very pleased to have received wonderful reviews from our beta students!
We will keep you updated with our progress. In the mean time, please come check out our Free Report: How to Retire in One Year with Only $10,000 and our E-Course: Basics of Stock Options. Both of these are free and we would really enjoy your feedback. Also, we welcome your ideas for subjects you'd like to see covered in subsequent materials. Please feel free to email us or comment right here on the blog.
Looking forward to seeing you in class!
The Financial Puzzle really began over 12 years ago when Jeremy and I first met in college. In our friendship, Jeremy has always been known to have ideas that were "bigger than life," and I've always acted as the "facilitator." This has worked out well and together we've accomplished amazing things in life. Typically this is how one of our ideas is conceived.
"Hey Josh, I had this crazy idea..."
Ilisten carefully while immediately figuring out the viability of the crazy concept. Typically this occurs while drinking Dr. Pepper (I don't think it's scientifically proven, but we think it makes us smarter.) After careful consideration and a couple hours of dreaming we usually conclude as I say:
"Honestly Jeremy,I think we can do this... and if it doesn't work I'll always think it should have!"
That is exactly how The Financial Puzzle started too! Like everything else we've done, Jeremy and I decided to work together as traders. What was unique about this endeavor is that we seemed to struggle at every turn. I can remember a couple very specific times that we wanted to quit. Our frustration was consistent -- finding a comprehensive educational program that would give us all the information and tools necessary to be successful traders in an easy to understand, down-to-earth format. We knew it could be done -- obviously since people were doing it all over, and we were determined to figure out how. We endured as we gained our education from the school of Hard Knocks - which can have a very expensive tuition for traders! However, we officially graduated and the investment in our education has proven to be priceless.
The Financial Puzzle was then the outgrowth of our interactions with other traders that had a similar frustration toward education. There just isn't a product out there that is comprehensive enough to make you a successful trader in and of itself. As we've met these frustrated traders we've always been glad to share the lessons we've learned along the way. Ultimately, our contacts spread across the country (literally from California to NY), and we found the webinar format to be the most convenient tool to facilitate our teaching. We have since gone through and systematically developed our comprehensive trading educational series: Foundations of Stocks and Options. We are very pleased to have received wonderful reviews from our beta students!
We will keep you updated with our progress. In the mean time, please come check out our Free Report: How to Retire in One Year with Only $10,000 and our E-Course: Basics of Stock Options. Both of these are free and we would really enjoy your feedback. Also, we welcome your ideas for subjects you'd like to see covered in subsequent materials. Please feel free to email us or comment right here on the blog.
Looking forward to seeing you in class!
Wednesday, January 14, 2009
What Does Apple Mean Without Steve Jobs?
If you haven't heard the news yet Steve Jobs has taken a temporary leave of absence from Apple until the end of June. For several months health has been a concern. After taming concerns last week today Jobs made the announcement. So what does this mean for apple?
As always the price of a stock is going to reflect the news. At one point today AAPL haulted trading. Once they started again the stock dropped about 10% pretty quickly. It finally settled the day closing after hours at $79.25. Tomorrow will be interesting to see reaction as the news spreads. In the morning I can almost guarantee a bearish trade will be present. Today obviously would have been a good day to place a strangle had we known the announcement was coming - but we can't trade the past.
For tomorrow I'd suggest sitting at the computer if you want to make some money. The trades could swing pretty wide depending on how news flows in and out. Eventually by the end of the day the price should settle after traders, institutions, and all those floating stocks around get their minds wrapped around the new face of Apple. The bigger question is where will the stock land? This news may break our AAPL, RIMM similarities that we had going as Apple is likely to fall a bit more. We'll see.
The next level on the chart would be around $73.00. If that holds then the fallout will not be so bad. If the $73 mark does not hold we're probably looking at a new support level down around $60, the top of the window gap from back in July 2006. Of course the ultimate fall on this stock would be down to the $50 support from July 2006. I can't imagine AAPL falling below that.
Anyway you twist it there appears to be some good trades left on AAPL before next week's earning's announcement. Watch volatility pricing in the options. It can really stick you at times like this.
As always the price of a stock is going to reflect the news. At one point today AAPL haulted trading. Once they started again the stock dropped about 10% pretty quickly. It finally settled the day closing after hours at $79.25. Tomorrow will be interesting to see reaction as the news spreads. In the morning I can almost guarantee a bearish trade will be present. Today obviously would have been a good day to place a strangle had we known the announcement was coming - but we can't trade the past.
For tomorrow I'd suggest sitting at the computer if you want to make some money. The trades could swing pretty wide depending on how news flows in and out. Eventually by the end of the day the price should settle after traders, institutions, and all those floating stocks around get their minds wrapped around the new face of Apple. The bigger question is where will the stock land? This news may break our AAPL, RIMM similarities that we had going as Apple is likely to fall a bit more. We'll see.
The next level on the chart would be around $73.00. If that holds then the fallout will not be so bad. If the $73 mark does not hold we're probably looking at a new support level down around $60, the top of the window gap from back in July 2006. Of course the ultimate fall on this stock would be down to the $50 support from July 2006. I can't imagine AAPL falling below that.
Anyway you twist it there appears to be some good trades left on AAPL before next week's earning's announcement. Watch volatility pricing in the options. It can really stick you at times like this.
Congratulations to our EXPERT!
At Financial Puzzle we are proud to celebrate with Jeremy (many of you know him as J-dub) on his recent award from EzineArticles.com. Jeremy has been recognized as one of their premier contributors and have awarded him the title "Expert!" He has also been featured regularly on their homepage and had several articles recently distributed for publication. We are proud of Jeremy and look forward to more great material!
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