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Blog post: How I use Bollinger Bands to analyze QQQ — watch out for QQQ around 372; 12 of the 13 stocks from Sunday’s scan advanced; 5 new ones

@ 8:12 pm
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I have the 15.2 daily Bollinger Bands drawn on all of my daily charts. It is basically a confidence interval drawn 2 standard deviations above and below the 15 day moving average of price.  According to John Bollinger, about 90% of prices should remain within the 2 bands when he used a 20.2 setting. I use 15.2 as settings because they work for me. Many bounces occur off of the lower band and sometimes a rise will stop or hesitate near the upper band. On January 24 when the recent decline ended, and at three prior times (designated by green price bars) note that the price bar was way below the lower band and then closed back above it. I call this a Bollinger Band bounce.

In addition, the Bollinger Bands are now forming a pinch with each band moving towards the other one. A pinch usually leads to a big move up or down. One does not know in advance which way the stock or index will break. So we wait. I placed an arrow on this chart at 372, right where the upper band is now. The upper band is also up against the critical 30 day moving average. We need to see if QQQ stops at the upper band and begins to decline or  breaks out, causing the upper band to rise. Or will the pinch continue developing?  I find daily 2.15 Bollinger Bands to be very helpful for timing buys and sells. Find more details on them here.

By the way, last Sunday night I listed 13 promising stocks from my IBD/MS watchlist that reached an ATH (all-time-high) last week. All but one of them are higher today, some by a lot. Remember KO and HSY? Go back and check them out yourself.  Buying stocks at ATH is the way to go. I don’t buy stocks that are way down from their peaks until they break above their former peaks (GLB).  The same scan finds 6 companies tonight: HSY, MCK, ACGL, ECPG, ABC and MS. Whether these rise will likely depend on how QQQ resolves. Remember, these are for illustrative purposes, do not buy these stocks unless you research them and they meet your own setup criteria. It will be interesting to see if they do as well as Sunday’s list. The stock market is such an amazing intellectual puzzle…

Blog post: Day 6 of $QQQ short term down-trend; On Monday, I tweeted that $VCRA had retested its GLB, see my TC2000 scan for finding such stocks

@ 9:55 pm
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You may want to follow my intraday tweets @WishingWealth. I tweet intraday when I see something interesting–no guarantees! Do your own research.

I have a simple formula I wrote for TC2000 that finds any stock that reaches an ATH in the past 100 days (use price new high built-in condition set to 250 month high within past 5 months) and that is currently within 3% of its 100 day high (C>.97*maxh100). TC2000 scans my watchlist of IBD50/MarketSmith stocks real time throughout the day. I then look at the stocks that come up and look at the built-in volume buzz indicator to see if it has unusual volume for that time of day and if I like the set-up. I then check out its fundamentals on MarketSmith. Another stock that came up in recent days is $ANET. (VCRA was not on my iBD/MarketSmith list.) Stocks holding near their ATH (all-time-high) in a correction can turn out to be leaders in a new market up-trend. Note my green and black dot indicators showing oversold bounces.

Blog post: Stocks rally and 2 day old $QQQ short term down-trend may end Monday; $NKE–an example of how I use my latest oversold bounce (OSB) scan to find promising stocks; $QQQ retakes all shorter daily RWB averages

@ 5:40 pm
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The key to prospering in the market is to have developed a set-up, defined by objective conditions which leads one to expect that a stock will rise almost immediately. The set-up must also suggests a price at which  to set a stop loss to sell out with a small loss if the set-up fails. If the set-up is good, one will likely end up with a lot of small losses and a few big winners that more than make up for the losses. I ran a new scan on the Dow 30 and found that NKE came up. NKE has recently had a green line break-out (GLB) to an all-time-high (ATH). It bounced on Friday from an oversold position. If I bought this bounce I would immediately place a GTC stop order to sell, just below the bottom of the bounce, at 164.67. If the stock trades below this price then the set-up has likely failed and I would quickly exit with a minimal loss. This scan also ensures that all identified stocks are already in up-trends and have recently reached an ATH. Note the black dot signal too, one indicator of being oversold. I do not own NKE. This example is for educational purposes only.

By the way, QQQ also was identified by this scan! Note the recent bounce up off of  the lower daily 15.2 Bollinger band, one component  of this scan.

QQQ has also closed (dotted line) back above all of the  short term averages (red lines). Looking to buy TQQQ if it holds.

 

The GMI is at  5 (of 6) and on a continuing Green signal. My shorter term trend indicator, currently at D-2, may change to an up-trend  after Monday’s close.