Shorting A Momentum Stock

Last week Under Armour reported earnings and there was a solid short setup. These were my thoughts on UA UA has had a huge run the past year and if the quarterly numbers disappoint many of the momentum investors involved will sell first and ask questions later. This means there could be selling pressure on the stock until it pulls … Read More

Trading AAPL Tomorrow?

If you would like to learn how to think like a professional trader pick up a copy of The Playbook today! Top 10 in Amazon Finance and from the author of One Good Trade the #1 Trading book in 2010. Here is my thought process going into tomorrow’s trading for AAPL: AAPL initial reaction was positive due to a combination of lowered … Read More

NFLX is the New AMZN?

Netflix is the new Amazon. What does this mean? It means for the foreseeable future hedge funds will step in and buy this name on every large dip and it will continue to have huge breakouts after periods of consolidation. Why is this the case? In the case of AMZN it got enough large players in the market to buy … Read More

Muscle Memory and Patience–Trading $ACAD

I like to say that stocks have “muscle memory”. There are several possible meanings for this expression: 1) A stock will repeat a strong move from a particular inflection point–this applies to both intra-day and daily levels; 2) A stock will move with a particular “cadence” intra-day that can be gamed to the trader’s advantage (or ignored to their detriment); … Read More

One Stock, Three Trades: $TSLA

(This post was written on June 1, 2013) The price action in $TSLA from the past six trading days does a nice job of demonstrating three distinct types of trades. Not all trades makes sense to all traders. But if as a trader you can figure out which of these trades fits your personality best and then build a detailed … Read More

Reviewing the SMB Archives

In August and early September, the market seemed to rotate around two distinct type of trading days: 1. The momentum panic day, driven by major news, with lots of volume in the SPY 2. An uptrending grind or ‘melt-up’, characterized by a wide ranges, low volume and steep pullbacks that would shake a lot of traders out but seldom break … Read More

What are your trades in MON? (The answers)

Non-experienced traders should not be trading MON during a conference call.  Experienced traders not listening to the conference call should not be trading during the conference call.  Experienced traders who do not know a great deal about MON should not be trading this during the conference call.  So this was a bit of a trick question (couldn’t fool @thearmotrader). But … Read More

Traders Ask: When Do We Switch From Momentum to a Position Trade?

Bella, I have attached a couple plays from this week. I don’t have the the tape for them but I explain it with the arrows. I also had a quick question. Today i my worst day trading NYX. There was so much volume done in a tight range that I expected an explosive move up once the stock showed its … Read More