Momentum Trader Report: 05/12/08

12 May

Posted by Mo-Trader as Momentum-Trader Report

As mentioned in yesterdays post, the market was at a decision point, and today decided to move higher, much higher. The S&P 500 bounced off its trend line, and rallied nicely with the rest of the indexes, closing significantly higher. The move was driven by lower oil prices and a rising dollar. Volume was low, but buyers were pouring into the tech sector, which saw some nice moves today.

On a day like this, I expect to see some good breakouts from the Watchlist. There was only one stock that triggered. It was FLS. It broke out and held on to close above the entry point, but volume was not impressive.

RIMM was a pick I had that triggered on Friday. It also broke out on weak volume, but gapped up this morning and took off, making an incredible move.

Another stock that triggered recently was GNK, which was up over 8% today!

I tend to be a panic seller, but one technique that I’ve been using to keep me in some of these moves is trailing my stop just below the 10-day MA. Momentum moves typically stay above this average for the duration of the move.

This week is options expiration already. It could be a very volatile later in the week.