The Stock Selection system is issuing many alerts, but I would not act if I read the market differently during the day. This system is good to remind me that something special might be going on for a stock, but if the EV pattern tells me otherwise then I would either cancel or postpone acting on the idea.
Yesterday, although the two short positions were under pressure early in the day, they recovered nicely when markets started to pull. However, in the afternoon, I sensed that there was money moving in and I feared that the market would squeeze everyone out, especially in the energy sector.
This is why I covered the short positions and booked whatever profit I had at the time.
I hesitated to buy ENDP on the intraday pullback but failed to do it. Now, the stock to too extended from yesterday.
CF, which was on the Buy ideas some days ago (and which I traded some days ago), looked like it was again ready to bounce. hence, I opened a new "short squeeze" based long position.
On the other hand, PAA, which is among the Pipe-lien sector, bounced on a very weak EV pattern. The stock is now 5% extended above its 5MA. Based on past trading patterns for this stock, there is little opportunity of getting long that far above the price envelope. Of course, the stock could move higher together with the pipe-line sector. I intend to closely monitor the position and hope for weakness early in the day.
The Portfolio is now 10% short and 20% long. The Portfolio ended September on a 1.04% loss, which is better than the market, but still in the lower part of the monthly performance. It has indeed been a difficult September.
The trade ideas for today are below. On the long side, I point to three energy related stocks that could be interesting to buy on a breakout.
These are the limit entry prices for the breakouts on Volume to work:
- WFT: Between $8.5 and $8.8
- WNR: Between $44.6 and $46.42
- MUSA: Between $55.65 and $56.21
These are the limit entry prices for the Normal Breakouts to work:
- WFT: Between $8.54 and $8.67
- WNR: Between $46.3 and $46.42
- MUSA: Between $55.65 and $56.21
Volume is important here. So please monitor the volume during the day we the price breaks out and only enter of the volume is higher than the average. I will email if/when I open positions.
Note that the three stocks in blue are drillers (also energy linked.) If I open some long positions in energy, I might take these drillers on the short side to balance the Portfolio.