Trade Ideas for 11/26/08

Today we got across-the-board pullbacks, the ones that were bound to happen sooner than later. What's encouraging is that the pullbacks were shallow, but also that stocks finished closer to their highs than their lows. Particularly in the commodities stocks. Since my read of the commodities is that they remain in a structural long-term bull market, I'm watchful of the point at which their path will diverge from that of the general market (which began a structural bear over a year ago).

That's well and good, but the big question is whether the pullback is over. I don't know; volume is on the light side, but there's still a good chance of a Thanksgiving rally. Fortunately my system is designed to rack up positions quickly when the setup is right, and right now the setup is right. If the market continues its upward path, we get stopped in to new positions as prices rise, and take part in the rally. If the pullback should continue, we either don't get stopped in (because prices don't make their way higher), or we get stopped in and quickly out on a whipsaw. What we don't do is attempt to anticipate a move higher prior to the actual breakout, nor do we buy a position and hold onto it even as it falls to new lows.

AN and ACM hit their major moving averages, and while both subsequently fell back, the latter managed to climb back up and is looking good. I realize I mis-blogged yesterday as AN was nearing its 50-day moving average, not 200- (as was the case for ACM). For my part, I dumped both of these positions just below their moving averages. We bought UGP at the end of the day.

Current Holdings
Ticker	Basis	Closing Price	Perf.	Sell-Stop	Additional Exit Guideline	Chart
GLD	74.27	80.87	+8.8%	79.27	Consider making the sell-stop a close-below price if you want a looser leash	Chart
LNG	2.94	2.70	-8.2%	2.49	Consider selling on a close < 2.64	Chart
AN	7.01	7.75	+10.6%	6.33	Consider selling on a close < 7.37	Chart
ACM	21.84	26.77	+22.6%	23.37	N/A	Chart
UGP	22.62	22.16	-2.0%	18.45	Consider selling on a close < 20.99	Chart

Many, many charts have the setup that I'm looking for, so my challenge tonight is to narrow that list down to a manageable number that is in line with my risk tolerance. For you guys, I'll provide a representative sample.

Trade Ideas for 11/26/08

Ticker	Entry	Exit A	Exit C	Chart
EGO (El Dorado Gold)	5.72	4.99	3.87	Chart
DBA (PowerShares Agriculture ETF)	24.86	23.99	23.22	Chart
AMZN (Amazon.com)	43.46	39.59	N/A	Chart
EWT (iShares Taiwan)	7.63	6.89	7.25	Chart

I currently hold shares of EGO.

Please refer to "How To Trade The Ideas" (right-hand side) to read this table.