Sunday, March 22, 2009

Chart work for the weekend

Oil stuff I've been buying over the last few weeks has played pretty well. I'm thinking we're in a mode where you want to buy weakness in these and trade around a core.

General market and most stocks I see are very overbought. Wouldn’t commit much money in on the long side here. But there's the potential for new Treasury scam this week, so I think it's important to have some long exposure, even if it's token.

Metals and materials charts look good to me right here, but stochastics are uniformly in the overbought range. Some charts I like on a pullback, and the (loose) entry points I'm looking at:

HL, around 1.90.

AWC around 2.75. The whole aluminum group looks pretty good.

TCK, around 4.50.

For a consumer staple, CL around 55. From some work I did a couple of years ago, this stock has the best inverse correlation to the $USD of any S&P component.

On the short side, the whole insurance group has come back to resistance. TWGP on the short side.

Once you get away from the major indices, I think the double ETFs are a total scam and a thorough bitch to trade. That said, take a look at EEV a little closer to that 43-and-change low.

1 comment:

Nate said...

Agreed the double (and triple) ETFs are terribly hard to trade more than a few days.

I have banned them from all trading strategies in my accounts for use more than 48 hours.