Trade Ideas for 06/29/09

From a low early Tuesday to a high late Friday, this market managed a sustained bounce off the golden cross (where the 50-day moving average crosses above the 200-day). Nevertheless, with respect to the S&P, Friday was a down day, and this week was a down week—the first time we've had two consecutive down weeks since the March rally began. So a bit ambiguous as to what type of market we have right now.

If the medium-term trend has changed to a downtrend, then this bounce is in keeping with the way declines unfold, and next week should see resumption of the downward course. At the same time, the action from the high on June 11 until Tuesday's low is not out of character as a correction within a larger uptrend. It's up to the market to show us which way it'll go. For now, setups in the inverse ETFs don't have great risk-to-reward profiles, so if the market is set to go down next week, I hope it'll give us a better setup to get aboard. Friday SRS was stopped out for a loss, and we bought DGP.

Current Holdings
Ticker	Basis	Closing Price	Perf.	Sell-Stop	Add'l Exit Guideline	Chart
SCC	61.84	63.51	+2.7%	62.62	N/A	Chart
DGP	20.26	20.24	-0.1%	19.64	N/A	Chart

For Monday, a few long-side charts that look good, and one of the less-bad setups in an inverse ETF.

New Trade Ideas

Ticker	Entry	Exit A	Exit C	Chart
HMIN (Home Inns and Hotels)	16.68	15.99	15.64	Chart
YGE (Yingli Green Energy)	14.07	12.99	N/A	Chart
BVF (Biovail)	13.76	13.46	N/A	Chart
SKF (Ultrashort Financials)	45.17	41.69	N/A	Chart

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