Get over with it: FOCUS on what you want

The below link describes what exactly is HFT and how the flash orders are manipulating markets.

You can see this live everyday if you are watching Level II quotes on your trading platform.

That is why sometime use of limit orders is not good. Market Orders will chase and hunt the price and get your order filled in rather than CAT and MOUSE game being played by the HFT computers.

http://www.youtube.com/watch?v=1CHgtNyGkk0

This second article talks about how some of the firms are taking actions and why your trading firm and the back order clearing firm should be Financially sound and strong.

http://online.barrons.com/article/SB50001424052970203952604575552190237324972.html?mod=BOL_hpp_dc

This article is from one of the fantastic bloggers out there, Charles Kirk.

It talks about how Life has been unfair and how to understand and internalize a problem to find a solution.

Free Reports « The Kirk Report

One of the way to beat the HFT computers are the days where there is lots of Chaos (not the ones created by HFT). Trading edge with very sound Risk Management, trade management.

I will post articles on Risk Management and Trade Management during upcoming ways and days.

Weekly ETF for Week of 18th Oct 2010

Weekly ETF

These are the top ETF to hold this week

1. AGQ

2. SGG

3. CZM

4. DAG

5. LBJ

This week EDC slipped to # 6 and CZM zoomed up to # 3 from #6.

We will track these top ETF again next week.

Top 5 ETF last week were

***********************************

ETF Weekly gain

***********************************

1. DAG - - 0.68%

2. SGG - 2.82%

3. AGQ - 8.76%

4. EDC - 3.10%

5. LBJ -4.58%

This gave a cumulative return of 3.7% on investing $1000 in each of these ETF monday morning.

The return on Market Proxy SPY (mimics SP-500) was meager 1.00%.

I would like to see how this strategy performs in Bear Market or some pullback.

Top ETF by weekly % movers this past week 10th Oct to 15th OCT

1. TMV - 11.75%

2. TYH - 11.73%

3. CZM - 10.33%

4. AGQ - 8.76%

5. TBT - 7.79%

Again looking at these weekly leaders, I wonder why somebody would invest in the stocks. This is one easy way to make money....

Also checking the the performance of last week's ETF selection based on its previous week performance

1. DAG - (-0.68)

2. SGG - 2.82%

3. RJA - 0.00%

4. AGQ - 8.76%

5. ERX - 4.32%

If the top performers were bought, your return would be 3.04%

Some Other things to watch this upcoming week is, Are we heading into Sector Rotation ? or some sort of orderly pullback ?

The below picture show bearish wedge formation.

Some of the stocks of interest this upcoming week

AAPL - Earnings after Close on Monday

EXAS

AMZN

BBY
FTNT

AMT

Also interested in the new IPO TOWR but it started sinking today, so will keep an close eye on that one.

Weekly ETF

These are the top ETF to hold this week

1. DAG

2. SGG

3. AGQ

4. EDC

5. LBJ

We will track these top ETF again next week.

Top 5 ETF last week were

ETF Weekly gain

---------------------------

1. AGQ - 9.68%

2. SGG - 13.97%

3. LBJ - 3.01%

4. CZM - 4.94%

5. EDC - 5.26%

This gave a cumulative return of 7.3% on investing $1000 in each of these ETF monday morning.

Top ETF by weekly % movers this last week

1. DAG - 27.11%

2. SGG - 13.97%

3. RJA - 9.91%

4. AGQ - 9.68%

5. ERX - 8.00%

Looking at these weekly leaders, I wonder why somebody would invest in the stocks. This is one easy way to make money..

How to trade ETF

I will post a weekly list of ETF that I am interested in or I am holding.

These are the best performers for the week.

Buy Criteria:

Buy the listed ETF on Monday

- If you are already holding one from previous week, then keep on holding

Sell Criteria:

Sell the ETF that is not listed on the list on M0nday

Also I will be posting my Market Timing on this Blog

I will post the latest ETF list over the weekend.

Currently I am holding SGG and DAG.

So keep on checking..

Sector Rotation and Getting Ready for UP moves

We are still in process of consolidation from all the down moves. We might see couple hundred points up and then couple hundred points down in upcoming days. We have to see the double bottom before I start believing in the start of bull rally.

This way I protect myself from getting whipsawed.

As promised last week, I am going to talk about sector rotation today.
From the below chart, you can see the performance of various sectors for last 65 days.
We can see that GOLD has been leader of the pack and held up very well during the market downturn. No. 2 is semiconductors.

Usually in a market rally, 3 sectors lead the rally pack, Technology, Financials and Transports.
From here we can see that Semiconductors are second ones in terms of Performance.
The key here to find few stocks in the Semiconductors pack.



From the below chart we can see how the performance of Semis have been as compared with $SPX. It has been rising steady so this gives us more confidence to get into the Semis.
The next post will be on how to find the market leaders in Semis or any other leading sectors.


$SOX:$SPX - Daily Candlesticks: "

Fake move up.. Tomorrow may sell off..

We had a mighty up move today, but based on the history, we had not seen the the RSI Weekly Dow and Weekly SPX go below 30 yet.

I am not going in with this move. If this move continues, it can go up to 20 Day MA and RSI will fight the 50 level. Usually when it does that, then after hitting 20 D MA, it sells off to new lows and then RSI can go below 30.

If we break 50 level on RSI and stay above 50 Level on RSI then we can have the bullish up move..

$INDU - Weekly Candlesticks: "

$INDU - Daily Candlesticks: "

$SPX - Weekly Candlesticks: "

via StockCharts.com

"

$SPX - Daily Candlesticks: "

via StockCharts.com

"

Back from Vacation - Waiting for Reversals

Sorry for my readers. I am now back from my vacation, will keep posting regularly.

As I analyze the markets, we are still in the deep pits.

Here is some of the stuff that I use for spotting reversals
Watch the weekly RSI (14 week setting). You can see from this chart that Dow Jones was showing up above 70 on Weekly RSI right from end of April. Around April 26, it went below 70 giving us the sell signal.

Now we are waiting for signal to go below 30 and then rise up from there. This should be watched along with RSI (14 day setting). Right now we are hovering over 30.62 on daily and 30.28 on weekly. Hopefully in next couple days, daily will dip below 30 and then go back down and then rise up again by end of the week. At that point in time, the Daily and weekly should be below 30 and trying to bounce back. That should indicate us a buy signal.

We are looking for that 5% to 20% bounce. So remain ready, keep the powder dry.

$INDU - Weekly Candlesticks: "

$INDU - Daily Candlesticks: "

via StockCharts.com

Will Post tonight or tomorrow HOW to FIND and SPOT REVERSAL LEADERS