Lightened The Load

The SPX closed below the 50 day therefore the M48 model now has a large percentage in cash.  The ETF’s TBT and DIG stops were hit for a built in profit.  The market will most likely continue to chop provided it holds 820 to 850.  Now we watch to see how the market reacts to earnings.  Volume lighter ahead of earnings and Obama being sworn in.

50 Day

Thurs AM-

The M48 is still 60% long w/ tight stops based on closes.  If the market bounces off the 50 day with decent volume the model will look to add on a break above 920 on the SPX (S&P cash).  However based on what I see technically we could close below the 50 day very soon.  Volume will show up tomorrow w/nonfarm and unemployment.  As always the market’s reaction to the numbers is what matters, not the numbers themselves. If we close below the 50 day the model will lighten up due to the odds of the S&P retesting the 850 range.  SLV (silver), GLD (gold),  DIG (oil), TBT (short bonds) are still holding up.  Stops have been moved up to lock in profit on TBT and DIG.

Moving Stops

I have tightened up all stops on current positions inside the M48 model.  

Very simple but very important.

Increasing Percentage Long to 80%

The Model model will increase it’s percentage long to 80% from 60% during the next week, hopefully on a little pullback.

The majority of the model is currently (check previous posts) made up of the S&P 500 using the SPY and ultra shares SSO.  Other ETF positions include GLD, SLV, IWM, DIG, TBT and the stock GILD.  All stops are in place and will be managed accordingly.  Keep an eye on individual stocks that I mentioned a few weeks back such as MCD, COP, CMTL.  It is just as important to wait for a potential position to breakout as it is not to chase it.  If I have to chase the S&P with a new subscriber I use the SPY.  If the SPY fades and holds (pulls back into its base) I then suggest to the subscriber/client the option of exchanging the SPY w/ the more potent SSO (ultra ETF).

I met w/ a client today and he referred to me as the “Stop Machine.”  I laughed and said that was a great name and an even better compliment.  Unfortunately his previous adviser was not a stop machine and his account dropped 40% before he became my client/friend.  I still think (based on technical probabilities) we will eventually break the lows we put in a few months back.    Until then the M48 will ride the waves using the stop machine to protect profits and limit losses. 

Note:   These are not recommendations and should be viewed for educational purposes only.  Never chase an extended stock and always use mental or hard stops.  Exact buy and sell points along with stop levels are for paid and 7 day trial subscribers only.  Subscribers receive all trades and trade management via email. For more information you can email me at doug@proinvestorcoach.com

Videos and upgraded web site coming soon.

Happy New Year!

So far the metals, crude and S&P positions inside the M48 model are working as of the close today.  A nice bounce today in the short bond ETF = TBT as well.

Preserving capital by using stops to limit losses and capture gains along w/ the safe money vehicle program has saved our clients/subscribers thousands in 2008.  I am extremely excited for all of you in 2009.

Happy New Year!

-Doug

Seminars in January

I will hold 3 seminars on Jan. 21, 22 and 27 in Rancho Sante Fe.  These seminars will focus on how to protect yourself in a down market by using safe money vehicles and also by implementing strict money management with stop losses while using diversified and liquid ETF’s

These strategies have saved my client/subscribers and Pro Investor Show listeners 10’s and 100’s of thousands in 2008.

Seating is limited and invitation only.  Call or leave a message at 858-805-1773  or email me at doug@ProInvestorCoach.com if you are interested in starting off 2009 with a real plan vs. a buy & hold diversified pie chart.

Don’t miss it!

Metals and Crude

The M48 model is still long 55% in various S&P ETF’s (exchange traded funds) with stop losses in place.  Resistance is just above 900.  Support is at 850 and 820.  Today the model added the ultra long crude ETF = DIG again.  The stop is at 24.72.  Fill price on DIG is under 27.  Maybe the Middle East tensions will give us a shot at 32+ which is resistance.

The M48 also added GLD (gold ETF) today w/ a stop a stop a 79.26.   The model is currently long SLV (silver).  SLV held 10 which is a good technical sign.  Based on probabilities I prefer to see SLV hold 10 to stay in this position.

Keep an eye on UNG (natural gas) and TBT (short bonds).  My stop on the TBT would be 35.80.  Close today is 37.09.

When a market (stock/commodities etc) is in a channel like it is as of this post, a well managed call writing program is ideal for a percentage of your portfolio.  Call me directly at 858-805-1773 for more info.

Everyone’s risk tolerance is difference.  View these positions for educational purposes only.

HAPPY HOLIDAYS!

http://www.slingblade.com/dougmckay/gallery/

Range Bound

Friday – 3 hours before the close.

The market has been in a channel for roughly a month.  If the market breaks down the M48 will go to cash and or explore short positions.  If we break 918 (SPX) to the upside the model will add as mentioned in the prior post.

AAPL and DIG no longer exist in the model.  Perhaps in the very near future these two positions will be added to the M48 w/ improved technicals. 

The M48 will add GILD to the model w/ a close above 48.91 w/ increased volume.  This position if added will consist of 5% of the model portfolio value.  The stop would be 45.66.  EPS and RS ranking are 90+.

You know how I feel –  these are exciting times if you can maintain strict discipline by using stops to limit losses and lock in profits.  This is exactly what the M48 does.

Have a great weekend!

Target 918 on the S&P

The SPX (S&P cash) ran up to 918 today but closed lower at 904.  The M48 will go to 80% long w/ a close above 918 .  The 918 target was mentioned in the post on 12/11.  Initial claims are out tomorrow. 

I believe it is important for the S&P to hold 851 in order to maintain this rally.

Crude closed down today but the M48’s small position in DIG closed above yesterday’s fill price.  The stop is moved up to 27.67.  The model will add to DIG if we get a close above 32.50.

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Welcome fellow traders and investors!

As Money Managers and Traders, the mission of our Blog and Radio Show is to go on record and further educate our readers and listeners in technical analysis and proper money management across all asset classes.

Our methods are not the traditional advice you hear repeated and repackaged over and over again, but that’s exactly the point and the reason why we know how to advance and prosper in every kind of market.

To Your Success,

Doug & Gary