Amazon Stock Twiggs Money Flow Breaks Positive

The Twiggs Money Flow on Amazon stock has broken above the zero line and has gone positive for the first time since August 7, 2017.

Amazon just rolled out Amazon Fresh in my area of Fresno, California. I signed up for the 14-day trial for Amazon Fresh and immediately canceled it because of the poor delivery times. On Saturday, I ordered 4 peaches, and a bag of shredded mild cheddar cheese. Amazon Fresh said they could not deliver it until Tuesday, LOL. I cancelled and told them I’ll just go to the grocery store myself and pick up these items in like a hour. If Amazon Fresh is going to be successful, they have to get delivery times down to same-day and at most, one day later. If they can’t do that they might as well close down their Amazon Fresh website because only the elderly and disabled are going to be willing to wait 3 or more days for their groceries to be delivered.

I think Amazon is poorly executing on their Amazon Fresh division. Amazon Fresh wasted about an hour of my time when you include the time it took me to order and then to cancel my order as well as my Amazon Fresh trial. I won’t try Amazon Fresh again for a long time. Maybe I’ll never try it again. That’s the cold hard reality of retail: first impressions are everything. Amazon has blown it in their roll out of Amazon Fresh by promising too much and then not delivering. Still, if any company can turn this around it’s Amazon.

MKM Partners recently gave Amazon a target price of $3,330 which you can read about here.

I’ve been trading in and out of Amazon stock for about a month now and it’s been a great stock to swing trade.

Amazon Stock

Amazon stock looks strong.

That’s a good basing pattern and perhaps even an inverted Head and Shoulders pattern. The 50 day moving average (blue line) is setting up a possible breakout play. Here is a swing trading lesson on breakout chart patterns.

In addition to the Twiggs Money Flow going positive, the Effective Volume study shows large players volume is still in an uptrend.

Prices have been consolidating lately forming a momentum squeeze on the chart:

stocks-to-watch amzn chart 1100x823 - Amazon Stock Twiggs Money Flow Breaks Positive

The TSI is holding its buy signal cross from August 30, 2017.

There is very little resistance above the current price. There is a support zone below the current price at $972.24, a stop order could be placed below this zone.

High Yield Debt Hard Break To The Downside Favors Pullback

High yield debt has taken a hard break to the downside and that supports the prediction that a pullback in markets is coming. Usually when a strong break either up or down occurs on the chart of HYG, the stock market follows within a 3 – 5 days. Using the high yield debt bond market as a leading indicator for short term swing trading is something you should be doing if you aren’t already.

High Yield Debt Chart

High yield debt chart makes a hard break to the downside last week.

The hard break down in HYG is indicative of a market pullback. The move lower seems a bit ahead of the September 25 – September 29th market pullback that I predict is coming. We could see HYG chop out a little before continuing the plunge lower as drawn on the chart above.

The goal is to get out of the way of a market pullback, and then go long once the stock market reverses. Since September is the worst month of the year for stocks, you have to be careful to not chase anything higher. Ideally you want to look for oversold stocks to go long as the market pulls back. I did a stock trading lesson on oversold patterns here.

Biotechnology Stocks Look Ripe For Pullback Before EOM

Biotechnology stocks look ready to pullback after rallying 11% since August 21, 2017. The key support level to watch on IBB is 329.

Biotechnology Stocks

Biotechnology stocks ETF IBB looks a bit toppy.

Notice how our favorite swing trading indicator the PPO shows falling histogram bars (red arrow). The falling PPO suggests IBB will likely retest its 329 support level within the next week. We might see a chop out to slightly higher move and then a break down through the 329 support level before the end of September.

Don’t buy the biotechnology stocks hype on mainstream financial websites like Seeking Alpha, MarketWatch, and Daily Reckoning.

I would not go long biotech stocks right now and would NOT take Tarun Chandra’s advice on SeekingAlpha here.

Also watch out for MarketWatch who awarded Greg Guenthner their “Call of the Day” because he wrote here:

Bottom line: the late-summer fade is finished. Biotech stocks are ready to finally put the finishing touches on a months-long quest to reassert the sector as a true market leader.

I like trading biotechnology stocks. Biotechs have the best catalysts of any sector and I did a stock trading lesson on finding catalysts here. What I don’t like about biotech stocks is a strategy that involves chasing them higher. Chasing high-beta biotechs is stock trading suicide IMO. Wait for the September (worst month of the year for stocks) dip that usually comes towards the end of the month before taking a long entry in biotech stocks.

Bonds Outperform Stocks…

For the week ending September 8, 2017, bonds outperformed stocks. Whenever bonds outperform stocks it means that money came out of offensive stocks and went into defense bonds. Tracking the bond market is one of our most important tools for swing trading. I did a lesson on how to trade in a sideways choppy market here.

us-economy spx bond chart - Bonds Outperform Stocks...

The fact that bonds outperformed the S&P 500 last week supports the thesis that a market pullback is likely coming the week of September 18 – 22.

Guggenheim ETF Candle Over Candle On Rising Large Players Volume

The Guggenheim ETF mid cap has formed a candle over candle reversal on rising large players volume. The Guggenheim mid cap ETF tracks the Zacks Mid-Cap Core Index. The Zacks Mid-Cap Core Index includes the Russell Midcap Index, the S&P MidCap 400 Index, and more mid-capitalization securities, including master limited partnerships (“MLPs”) and American depositary receipts (ADRs”).

Guggenheim ETF Mid-Cap Holdings

Top 20 holdings as of 8/30/17:

Ticker Security Name
COL ROCKWELL COLLINS INC
ROK ROCKWELL AUTOMATION INC
A AGILENT TECHNOLOGIES INC
CCE COCA-COLA EUROPEAN PARTNERS
DTE DTE ENERGY COMPANY
ES EVERSOURCE ENERGY
HIG HARTFORD FINANCIAL SVCS GRP
MHK MOHAWK INDUSTRIES INC
BXP BOSTON PROPERTIES INC
KEY KEYCORP
PFG PRINCIPAL FINANCIAL GROUP
VNO VORNADO REALTY TRUST
IBKR INTERACTIVE BROKERS GRO-CL A
BAP CREDICORP LTD
CNC CENTENE CORP
MMP MAGELLAN MIDSTREAM PARTNERS
AGR AVANGRID INC
FTS FORTIS INC
AWK AMERICAN WATER WORKS CO INC

Guggenheim ETF Mid-Cap Chart

Guggenheim ETF

CZA shows a good Symmetrical Triangle setup pattern. The Effective Volume study shows that large players volume has been rising rapidly over the last several days and the positive Twiggs Money Flow supports the bullish candle over candle reversal. I found this stock using the GST Positive Divergence screener I set up for you under the Shared Screens tab on Chartmill here.

There is reduced volatility while prices have been consolidating in the most recent period which has created a Momentum Squeeze:

stocks-to-watch cza stock chart 1100x823 - Guggenheim ETF Candle Over Candle On Rising Large Players Volume

There is a resistance zone just above the current price starting at $61.28. Right above this resistance zone may be a good entry point. There is a support zone below the current price at $61.22, a stop order could be placed below this zone.

CZA is in a continuation pattern on the chart. I did a stock trading lesson on the continuation pattern here. Please remember that I am a swing trader and so every stock I profile on GuerillaStockTrading.com is a get in and get out quick swing trade unless stated otherwise. Make sure you review the FAQ page about swing trading here.

Swing Trading With The SPHB:SPLV Chart

The SPHB:SPLV ratio chart is showing a compelling setup for small cap stocks. The SPHB:SPLV ratio chart tracks high volatility (high beta with tendency to be small cap) stocks to low volatility (tendency to be large cap) stocks. This ratio chart is another barometer for the risk on versus risk off trade.

In a risk on market, higher growth and higher beta stocks are the name of the game. Investors go on the offense for maximum profits and their less concerned about the economy and a recession. In a risk off market, investors go on defense and move into safer and more stable (low volatility) large cap stocks.

SPHB:SPLV Ratio Chart

business sphb splv 1100x654 - Swing Trading With The SPHB:SPLV Chart

The market has consolidated a little over the last week and that was the swing long signal we were waiting for. Notice that SPHB:SPLV has broken through resistance at 0.8050 and now is pulling back to retest that level. This is a classic set up we can trade. If the 0.8050 level holds, it means previous resistance has become support and we can take a beautiful entry off that level (green arrow). Make sure to review this lesson on trading for beginners so that you know which stocks to screen for to take advantage of a turn in the SPHB:SPLV chart.

Stock Market Correction and Waiting To Click The Buy Button

The stock market correction is likely going to push the S&P 500 to test its long-term rising trendline and support at 232.20. The bearish divergence on the Twiggs Money Flow likely signals that the pull back is not over yet.

Short-term stock market correction underway.

A few traders have asked me if now is the time to buy or if they should wait on the sidelines while the market pulls back. We all know that history does not predict future price direction nevertheless, it is useful to know what has and hasn’t happened in the past.

Looking at the last 110 years of stock market price action, the data reveals that waiting for a correction when the market was expensive would have reduced investor returns significantly. The reason is that the term “expensive” is a subjective term. Even if you use a more objective approach of looking at the P/E ratio, the data still shows that staying out of the market for months or even years waiting for a correction is a losing strategy.

Where long-term investors get themselves in trouble is that the correction they are waiting for may occur at a much higher market level than it is at today. Also, sitting on the sidelines for months or even years runs the risk of the investor losing patience and ultimately capitulating to the Bulls and buying back in to the market at a much higher level.

Few investors believe markets efficiently follow a random walk even though it’s a key component of market theory.

Short Term Stock Market Correction

Timing a stock market correction for profits is best done using a short-term swing trading strategy. The idea is that you don’t want to try and catch a falling knife.

Looking at QQQ, the Russell 2000, and the S&P 500, over the last week, you can see that the Russell 2000 and QQQ are leading the S&P 500 lower:

In stock market corrections, the Russell 2000 usually leads the other major indices lower.

The market is telling us that what happens in the FANG stocks and QQQ will likely dictate market direction on the S&P 500.

business QQQ chart 1100x953 - Stock Market Correction and Waiting To Click The Buy Button

With the Twiggs Money Flow breaking below zero for the first time in 2017, I think a retest of the $136 support level is likely.

Right now being in cash is an excellent move. Continue to stalk your favorite stocks for a swing long entry. I wouldn’t be too quick to jump back into this market yet. Consider using stop limit orders as taught in the lesson here.

The main thing to watch out for is the Establishment ‘Defeat Trump’ propaganda in the WSJ, CNBC, CNN, and elsewhere. These media groups are so dishonest that some were even claiming that the stock market went up because Steve Bannon left the White House. That was the propaganda narrative with CNBC claiming that traders on the NYSE floor cheered as proof. First of all, those old left-leaning talking heads in stock exchange clothing walking around looking stupid on the NYSE floor are not representative of the stock market as a whole.

Just as the Establishment media was advancing the false narrative that markets were up because of Steve Bannon being out at the White House, markets turned back down and so they quickly killed that false narrative. Another example is CNN’s propaganda that the entire market is worried because of Trump.

For the first time in our life-times, we have a President who is exposing the Establishment propaganda media in this country. There is a major information war going on right now.

As a trader, you can’t get caught up in the propaganda and the power struggle going on for control of public perception. You have to check yourself every day and make sure you aren’t making trading decisions based on propaganda. If you think the mainstream media is getting into your head too much, cancel your subscriptions like I did with CNBC Pro last week, and the WSJ and Barron’s the month before. Just turn it off because these propaganda machines are not going to help you make more money at stock trading.

Remember folks, markets mostly do random walks, especially during intra-day trading. No left-leaning propaganda media outlet can peer into the minds of millions of traders around the world and claim to know what they are thinking. These propaganda publications believe that perception is reality so if they can control the public’s perception, they can control reality.

The U.S. stock market is overbought, and the weak seasonal period is upon us. May through October marks the weakest 6 months of the year.

I don’t want to beat up on the mainstream media too bad so I’m not going to mention where I read the following bogus analysis:

Overbought markets look for excuses to sell off. Will Trump’s lack of leadership become an excuse for a big selloff in stocks?

The mainstream media is actually talking about a stock market correction as if it is some type of external beast that thinks for itself and makes up excuses. Reality check: you and I are the markets. People that work at institutional trading firms and hedge funds are the markets. Are you looking for an excuse for the market to sell off? I’m not either. Nobody is. We’re just reading the charts, analyzing the fundamentals, weighing external news events, and making our decisions. Nobody is searching under desks and looking everywhere for excuses to sell out of their positions. Especially not some make-believe entity called Overbought Markets.

Did you notice the Establishment propaganda “Trump’s lack of leadership…”? You can criticize the President on a lot of things but one thing you can’t criticize him on is a “lack of leadership”. President Trump is a strong leader with strong ideas and a vision on which he is moving to execute those ideas. Get in his way and “you’re fired”. Trump demonstrated his very strong leadership skills for over a decade on the hit-show The Apprentice. President Obama isn’t even in the same ballpark as President Trump when it comes to having strong leadership skills.

Mainstream media propaganda about stock market corrections.The main factors influencing a short-term stock market correction right now are: the speed of Fed rate hikes and balance sheet reduction, North Korea, the debt-ceiling, the economy, and the speed at which the Trump America First agenda is moving forward. Anything outside these main themes is likely Establishment propaganda by powerful groups battling to control public perception and thus reality.

Catalyst and Stock Trading Ideas Are What Will Make Or Break You

Stock trading ideas are the life-blood of profitable investing. It does not matter if you are a day trader, swing trader, or investor, coming up with ideas is where the money is at.

All the greatest investors were master thinkers who came up with a good idea and then ran with it.

Look at Others Stock Trading Ideas

An excellent web page for monitoring others ideas is at Trading View here.

You can see ideas coming in from other traders in real-time. You shouldn’t actually follow any of the ideas on this webpage. You don’t want to enter into the bad ideas of somebody else. The goal is to work the idea muscle in your brain by being inspired by other traders posting on Trading View.

Google Search For Stock Trading Ideas

Don’t overlook using Google search to find ideas. Type “stock trading ideas” and then do a NEWS search by clicking here (this link will take you to a Google news search for stock trading ideas, within the last week).

The ideas at the top of this Google search are going to be from professional and institutional traders. Again, I would caution against following these stock picks directly as these professionals have already positioned in these stocks and are now using the mainstream media to pump their positions. Instead, let this search result help get your own creative thoughts flowing.

Come Up With 5 Ideas a Day

Work the idea muscle in your brain. Write down 5 ideas every day. Most of them are going to be bad. That’s ok. The important point is that you are coming up with 5 ideas every day to work your brain muscle. After doing this for several months, you will get really good at this.

Here is a great tool for coming up with stock trading ideas:

GO HERE TO CHECK OUT THE AWESOME TOOL IN THIS VIDEO

Best Swing Trading Strategy Is In Financial Stocks Right Now

The best swing trading strategy in stocks is coming from the financial sector right now. Several banking stocks look like good swing long setups after JPMorgan and Citi crush estimates.

Banking Stocks and the Best Swing Trading Strategy

In a stock screen of recent pullbacks in the strongest stocks in the market that are still near their 20 day high, banking stocks were the common theme.

Specifically, this best swing trading strategy screen is scanning for:

Price: Above 20, Average Volume: 50 SMA > 20K, Near 20 day High which limits the maximum distance to the 20 day high to 5%, Price Below SMA 10, Price Above SMA 20.

Citigroup

Citigroup presents a good setup pattern. Prices have been consolidating lately and the volatility has been reduced. A pullback is taking place, which may present a nice opportunity for an entry. There is a resistance zone just above the current price starting at 67.45. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 65.75, a stop order could be placed below this zone. Notice how well pocket pivot signals (blue dots) have given good entry points for swing long trades.

CNA Financial Corp

CNA is showing a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is a resistance zone just above the current price starting at 49.03. Right above this resistance zone may be a good entry point.

Bancfirst

BANF presents a decent Symmetrical Triangle setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is a very little resistance above the current price. There is a support zone below the current price at 98.69, a stop order could be placed below this zone.

You can find out more about how to use the best swing trading strategy screener here.