Charting Trends

Leveraged Base Metals ETF (BDD)

I mentioned last weekend that I would not likely buy anymore stocks, since I already own so many. But if the market keeps rising, I will consider adding to existing positions, like this ETF below, which so far is working out:

First Solar Inc. (FSLR)

This great looking chart was originally identified on the blog The Art of Trading. I don't mind buying other people's stocks as long as it fits my own rules, and this stock definitely fits my rules for a long candidate.

Notice the bullish gap up, the recent golden cross, and the triangle formation:

MDS Inc. (MDS.to)

I did these trades this week:

Covered BLUD (This test position helps confirm my view that the market is strong)

Bought BDD

Bought CSC

Sold U.to (Hard stop hit. Stock has not been able to close above its open for 12 consecutive days)

Bought ELNK

Sold RBI.to (Hard stop hit. Good process that resulted in bad outcome)

Bought ASIA

I made money every day this week, except for Wednesday, but Wednesday's commodity sell off was severe enough to result in me being down for the week as a whole. Considering the general market rose for the week, this is a poor performance.

I am not going to try to find any additional long candidates at this point. I am now long 9 stocks, and buying new stocks I do not think will add very much marginal diversification.

If the market continues to rally next week, I will plow new margin back into my existing stocks.

If the market falls next week, my weakest longs will get stopped out, and I will replace them with shorts. Finding short candidates is still difficult, but this week's post has identified the weakest stocks in the market right now.

Some of the stocks identified are in sideways trends, but, in my opinion, a stock that is in a sideways trend when you have a market that is up 40% is still a weak stock from a relative strength perspective.

Here are the positions I am holding going into next week: