Momentum Trader Report: 04/28/08

Today was a choppy low volume day, and seems to indicate that a lot of market players are sitting out until they hear the Fed decision on Wednesday. Although choppy, today was good for the Watchlist. There was nice continuation on some picks from Friday, and two stocks that broke out today.

The biggest mover of the two was REXX. It gave back much of its gains late in the day though, but did close slightly higher.

CLF has been a big winner from here. I totally screwed up the entry point on the Watchlist. The buy point would have been just above recent highs at 164.75, plus .02 confirmation.

If your following these trade ideas, make sure you compare the prices on the Watchlist to those on the chart to make sure they match up.

CLR was a breakout from Friday that had another impressive day.

HAS also put in a nice follow-through day.

This stock was a pick here last Thursday night. It gapped up on Friday morning, and I tried to get in using a limit order that was just a tad too low, and missed it. It also reported earnings this morning, and I don’t hold into earnings. But I can’t help but wonder “What if?” This baby is up nearly 20% from the buy point listed here last Thursday night.

In last nights post, I talked about oil, which has been making a huge move. I still think a substantial correction in oil is due soon, just not sure when. Although I took an oil play today (REXX), I am hesitant to play an more oil stocks here. The reason is due to the Fed meeting this week. It’s expected that the Fed will make a 25 bp cut, and then refocus their attention on inflation, which means no more rate cuts. This should send the dollar higher, and bring oil and other commodities lower. Of course, this is all armchair economics.

If you agree that oil is going to take a hit soon, you may want to keep an eye on DUG, an ETF which trades at twice the inverse of the daily performance of the Dow Jones U.S. Oil & Gas index. I may take a small position when it closes strongly above this downward channel. Then add if it continues to move higher.

There is a lot of other financial news coming out this week in addition to the Fed meeting tomorrow and Wednesday, so there could be a lot of whipsaw action this week. This doesn’t favor my style of trading. I may sit tomorrow and Wednesday out, unless stocks from my Watchlist look like they’re going to take off.

Trade Ideas for 04/29/08:

I don’t have any new stocks on the Watchlist, just previous picks that have yet to move.

Good luck and good trading!