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EIA stats here:

E.I.A. Statistics

ACTUAL SURVEY ANALYSTS’ RANGE
GAS 372K 150K -1000K to 2000K
DISTILLATE 1630K 450K -1300K to 1700K
CRUDE 5511K 875K -1000K to 2200K

As you can see the numbers are bearish.We’ll have to wait until the dust settles to see where we go from here.SU did trigger as a long,and I hope anyone who took that trade used some discretion with those numbers coming out.I’ll follow up on that later,for now it seems to be holding it’s breakout of the cup and handle pattern on the daily.Intraday if you took an entry,I hope you took something off the table on that pop up to 84.13.As for myself,I missed my entry,on my own setup,and ended up taking small scalps in it.I am currently not in the stock as that was a pretty nasty pullback on the reaction,but I will be stalking SU for a new entry if the trend holds.Post charts later.

Cup and Handle formation

Reasons for long side trigger above $83.36

1) Cup with handle forming: good volume on left side of cup with a slight drop in volume at cup base,and slight increase on right side,with a decrease on handle.Volume needs to increase if a break to the upside occurs or pattern will not be as valid.

2) Moving averages are in proper order.

3) Uptrend from previous breakout is still intact,along with uptrend in oil sector still intact.

4) 50 day sma has crossed above 200 day sma,with the 150 day sma approaching a cross above the 200 day sma to complete the proper order of the averages.

5) Four week consolidation in progress setting up for a break higher increases potential of long side.

Reasons against long side:

1) Any break of the current uptrend and a failure of the pattern would invalidate this setup.

2) Global news could affect the trend.

Just laying out the odds,which at the moment are in favor of the longside.That was also a nice increase in volume at the close today.Watch for the pivot trigger at 83.36 for a potential swing trade,or potential intraday action on this one.I’ll set targets later after we see confirmation of the move.No trigger, no trade.

Oil is making a nice close here,watching the OIH,$XOI,nice orderely pullback keeping within the current uptrend.Setting up SU for that possible break higher.There is obviously some big money Oil guns holding this baby above $82.00.The more I look at the daily chart,the more I see a cup and handle formation here.I’d like to see some volume on the breakout over 83.00 and 83.36 if it comes into play.That should break the handle formation and propel this one higher.I also like the fact that todays low was lower than the prior two lows and the stock is setting up to close at the top of the range now making that pivot at 83.36 an even more likely trigger for a move higher.Keep in mind the EIA statistics come out tommorrow which will most likely show us confirmation of the direction coming.

SU is getting my attention again here.It has been consolidating again now for the last 18 days,and holding above 80.00 with only one close below that point.It now seems to be holding above 82.00 and reaching for a close above 83.00,which would set it up for a nice break higher.I would like to see it consolidate for one or two days at the most,which would also set it up for a nice 20 day breakout.The short-term uptrend is still intact along with the move in OIH.Oil had a slight pullback here which may not be over quite yet,and I think Wednesday’s EIA numbers could setup the coming direction,trend continuation or a break of the trend.Trade what you see not what you think.I’ll be watching SU for a trend continuation if it makes a move above 83.36.Otherwise no setup.Also the 50 day sma has closed above the 200 day sma as of today,which strengthens the odds of the current trend.What I don’t like about this stock is it is not rated as one of the stronger stocks in the group as far as relative strength.It also needs a little added volume if it does try and break higher.I’ll try and post a chart soon,if I get time.

Today is a nice turnaround in my trading from yesterday.I was a bit off when starting out and didn’t hold onto a nice short in ITW (Ill Tool Works Inc.) Realizing the same feelings I was having yesterday about taking trades off that should have worked,I got my composure together and stuck to my strategies that work for me.I used the Trailing stops on the next couple of trades and made a nice gain in both CNH and DE. I decided to leave ITW alone,and move on to the next opportunities.Basically one good trade where I followed my strategy is where the bulk of my day has been made up.I did get stopped out as DE pulled back,but I am completely ok with that because it was my choice of exit as I placed the trailing stop.I think I’ll rename the stop order/or trailing stop,and begin calling it my “precautionary exit”.Why? The word stop I think is so harsh and the way it is used for example someone might say “I was stopped out”, or “They ran my stop,and made me get out”. No,I like the word Precautionary Exit better,because after all a stop is an exit,because we the trader place that order to minimize our risk and to capture our profits.The best trading comes from accepting responsibility for every aspect of trading.Sure there is the occassional event that may cause an unknown consequence,but trading is also a game of not knowing the outcome.We can only use strategies to apply what we know and protect against the unknown.I am ok with not knowing where a stock is going or what the outcome of my trade will be as long as I follow my strategies.That is the way good trading should feel.If you are feeling a need to be right or know something for sure,you will be let down again and again when things do not go in your favor.That can be a very frustrating game.A good trader doesn’t need to know what will be the outcome,a good trader has a plan,knows when to bend the rules of that plan,but also when to adhere strictly to that plan.With that said I will be monitoring the market for setups,but if I do not see anything then my trading is done for the day.

Well today was a day of revenge trading,an amatuer move on my behalf.I wasn’t mentally ready to trade first of all,that should have been clue number one.Here was the start of the day.I’m scanning the markets for candidates and what comes up to the top of my list,MCO (Moody’s Corp.).I find a low risk entry at 67.37 the high of the opening range.I couldn’t of asked for a more perfect entry,so what do I do you ask? I take it off for a Flat,why?I’m still trying to figure that one out.Of course you all know what happened next,the stock traded to a high of 71.38. The rest of the day from that point on was a total fiasco,well not totally,but just a bunch of dumb trades that added commissions and made for a losing day.So what did I do wrong? One I did not “physically enter a protective trailing stop,and give the trade some room to start working.Two,I let the fact that I blew the exit get to me for the rest of the morning and day,which caused me to miss other good setups in the morning.Three,I was not mentally prepared to show up to the game,and I should have benched myself.What did I do right today? I realize the things I did wrong! Point in matter is,show up with your “A Game” or don’t show up at all.

AGU (Agrium Inc.) Closing strong on good volume above a prior consolidation.
BGG (Briggs & Stratton Corp) Closing strong on “decent” volume,above previous consolidation.(Looks like some shorts are getting squeezed on this one.
TEX (Terex Corp) Strong close,volume close to average daily,but not above.Also closed above prior consolidation.

Just a few stocks to watch in the next few days,these are not intended to be recommendations.Although you could probably apply some basic swing trading principles to them with very tight stops.I’ll be looking for intraday trading opportunities in these.I may add to this list as I scan the market later on.The Dow jones industrial($DJI) or ($INDU),is looking strong here and approaching highs where we will either find a test of prior highs,breakout,or fail.Not predicting anything here just my observations and the potential scenarios.The average closed today at 12,720.46.