7/31/17 Follow along as @alexmorris and I try to save J.C.Penney (JCP) from Jeff Bozo and Amazon
Everybody "knows" that Amazon (AMZN) is the greatest retail entity out there. And that's exactly why the stock price of AMZN wil be cut in half at least 3 times over the next 12 months. But is it too late to save J.C. Penney Co. from going belly up? Follow along as my new charting protege @alexmorris and I not only try to prevent JCP from a bankruptcy filing...but who knows, perhaps there will be a blue light special along the way too. No wait, blue light specials are at Kmart. Nothing Alex or I can do to save that farce of a retailer from bankruptcy. :O
As of right now JCP stock closed at 5.56. I consider it an intermediate term short with a downside target to 4.50 minimum by 8/18. I will log in 5.55 as my sell numba and I will also post an options trade if it continues to move higher from here.
Looking forward to it Teach, it sure is an honor to be apart of your "spew" :D.
Yeah, buddy. I'm counting on you to post those "blue light" specials as the price of JCP goes loooower and looower. I'm in the market for a new pair of work boots and a hard hat. You might want to get yourself a hard hat if you are going to follow along with the general market festivities I have planned in the near future. :-) And be careful! You "might" actaully learn something! :O
Hi Joe, JCP has made a lower low with not much RSI action, and the previous low breached below 20 on the RSI chart. Is this our time to buy?
The last low was a very sharp spike downwards then quick recovery, does that affect our strategy?
Good observation of RSI readings on JCP. It did in fact just post a lower low on a higher RSI reading so one could "expect" a rally soon based solely on the RSI readings. That said, there are still lower lows below as targets, but because of this RSI signal I would refrain from shorting and look at teh next rally as a shorting opportunity. Let's see if it now rallies to generate a sell signal based on a higher high with a lower RSI print. RSI needs to trade to at least 80 of course. Nice work.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=jcp&x=53&y=17&time=18&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=7&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
There you go, a new n improved n loooower RSI reading of 80+ to work with. You wouldn't have known about the lower lows on JCP since you haven't been tracking it of course. But the open made the decision on whether to buy or not a very easy one.
Awesome, thanks for the update man.
Here is an important signal I want to show you that was generated on JCP today. This time via the DMI indicator, the indicator with the blue, red, and black line. This is a new major oversold reading that formed today which I call a "trend low" because as the ADX line is crossing 60+ the red -Dmi line is dominant over the blue +Dmi line. Whenever a trend low forms it is a "major" support/resistance area. I use these reading to determine "probable" new price targets to the downside. This is now the lowest major support/resistance area that JCP has formed since I have been tracking it and you are watching history being made as it actually happens. The previous lowest (now major resisitance) area above for JCP is the 4.51 number I already gave you, which of course is the target we waited for, AND the target that kept us out of trouble because we were "patient." JCP just blew right through it and has now "forced" me to looower my long term buy target to 2.25. That's a full 40% below the low of this new trendlow which is 3.77 (entire range is 3.89-3.77). The windup is that if you are a long term buyer you would not even consider buying JCP until it sees at least 2.25. How do you "know" it will even trade that low...when historically it has never been that low you ask? Watch me work my magic over time. :-)
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=jcp&x=49&y=12&time=18&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=7&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
You can apply this theory of trend lows to any other stock you are tracking and you will then "know" every major support/resistance area if you track them over time. They are like "magnets" for price. JCP will now have a veeery difficult time rising back above 4.51 under current market conditions.
Wow man, I find it crazy that an indicator can tell you that a stock is going to drop 40%. It's almost unbelievable, not that I'm doubting you, you obviously have a successful system going. It did after all take a massive hit yesterday. I'm definitely paying attention to see what happens. Does this mean that you are in some sort of longish term trade against JCP? Or are you in the game for shorter term moves?
I've ordered a few books, looking forward to seeing what they've got to say about the things we've discussed. Obviously this DMI indicator is a big one to get figured out. I still don't know shit about options.
You're obviously not phased by this North Korea thing? You've got balls of steel my friend.
Thanks again for sharing. I'm taking notes, great information :)
Me? Phased by Kim? Come Monday I "might" just put the kabash on the ENTIRE military industrial complex via a "well placed" short on Lockheed Martin. The ticker on that one is LMT...just plug it into the "enter symbol" window on your Bigchart. Go ahead Mr Trumpf..."MOAB" Kim...I dare ya! :-) I'm doing short term trades until the markets completely top out. And that won't happen until the sexy VIXens attack (and in the case of UVXY, take out) 52 week lows. Keep watchin JCP though. Let's see if the 4.50..ish area now acts as a ceiling on any rally. Here's a little penny dawg that just set the lowest trendlow I logged in and has already "almost" dropped the entire 40%. I will call the long term buy target .24 based on the trendlow (still visible on the 10 day chart) at .41. A drop of 40% less than that takes it to .24.Just another case of waiting for "the numba." Now we will find out (using the DMI readings) whether or not GALE >>> 1) Blows right thru that .26 low and generates another trendlow, which would dictate even looower prices...or 2) Trades down to the target buy near .24 (don't hate me if I miss by a few centavos) and gives us a chance for a 100%+ gain. I'll spew a blog on it "if" it actually generates a buy down assunder.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=Stock&symb=gale&x=47&y=19&time=18&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=7&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
Oh, as far as options go, the reason 99% of all people lose trading them is becuz they enter a call option (buy) before a price target that is lower than where they bought which still needs to get taken actually does get taken out. Until the low actually is breached it is "unlikely" that a strong rally can begin. So as the price moves down to take out the number below that needs to be taken out (while they hold their call option)... they lose $$$ as the time premium of their option deteriorates. So it is the Ty Ming of options trades that create the losses. And that can be rectumfied by making sure you do not enter your call option unless prices below that need to get taken out in fact DO get taken out. Or if entering a put option, a high price above that needs to get taken out will prove fatal to your put option if you enter it before that event actually occurs. UVXY is a good example, people "likely" getting excited about piling into the VIX and VIX derivative trades via call options right now becuz they "think" there is still a shitload of downside left in the markets. But you and I both "know" that UVXY is coming all the way back to set a new low. There is still "likely" a bit more upside in the sexy VIXens. But if you enter an out of the money call option for say Sept expiry...you may just as well flush your money down the toilet becuz the result will be exactly the same.
8/16/17 update: OK, I'm sure you have been busy reading your new books. So that's why you missed the most rescent RSI "potential" buy signal. A lower low in price with a higher RSI reading. And now that the previous 4.51 low was breached, and a new low was set today...it is time to pay a little closer attention. yes, JCP still has a future date with sub $3 ..but teh future might not be right now. The DMI indicator is signaling a potential rally from around here. If one of those books you just received outline that...I'll buy the same book. :-)
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=jcp&x=50&y=13&time=18&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=7&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
If it rallies...you already know the "potential" uspide target. Is 20% in say a week an "OK" trade as far as you're concerned? I wouldn't even consider the trade personally. Not enuff chachingo for my personal preferences.
Yazzum. JCP "rapidly" approaching the price target I posted in my initial spew. You wouldn't have gotten that info from the RSI studies...and also, RSI studies are not perfect for Ty Ming your trades. Look at how UVXY rallied before putting in a lower low than the RSI 80 reading at the 52 week low of 28.20 for instance.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=uvxy&x=43&y=25&time=3&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=7&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
The windup is that UVXY is coming aaall the way back to set a new 52 week low...which of course means the markets in general are going to attack the multi-year highs.
8/17/17 end of day update: I didn't even watch the open but I see that JCP did open lower. Let's see what those 3.50 calls priced at today since it was the first day you could trade them after my "spec" short term buy on JCP to 4.50...ish. 9/1 expiry 3.50 calls only had one trading price today of .24 on 42 total contracts traded. I'll log that in...it could go either way but it's basically a $150 bet...and that's all you can lose...so I like the odds on this one. I'm waiting for a gold trade here now after today's festivities. DUST shares might double off the next low. Here's JCP though.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=jcp&x=43&y=17&time=18&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=7&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
Hey joe, are you still tracking JCP? I was following along too. I ask because looks like a divergence on the RSI, tue after open high, with the high on Fri before the close and price made higher highs. so is JCP Bearish? I am still learning on trying to understand the rsi. please correct me if i am totally wrong haha
Yazzum, still trackin JCP. It signaled sell on last week'smove thru $4 so we will see if it moves on to my new n improved n loooower buy point now. I will put up a new JCP spewage board/board if it runs to 4.50+ for better short entry...or moves on to my buy. But you can see on teh chart that the higher price above $4 on the lower RSI reading (below 80) also signaled it "might be" time to exit the trade. The previous high was 3.97 two Thurs ago.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=jcp&x=38&y=14&time=18&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=7&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
Cool I see, looking forward to the jcp spew
BIG trade coming short the mining stocks via GDX. You can also go long, strong, (and potentially very wrong!) DUST. I was a tad too early on that entry...but it'll buff out just fine. :-)