Breakoutpickr

Our TNA trade is working great. So far we have roughly 25% profit in TNA. We still like the market here and will be buying pullbacks. Hence we are going to keep TNA. We recently added to CAT position around $106 and it has been working great so far. We like the price action in CAT.

Coming to the trades that are not working, we bought V in the $100-$103 range when the market broke out around the 1270 level. Since then V underperformed the market and the price action has not been great. On the other hand, V has not broken below the 50 day support and also is above the $96-$98 breakout area. But due to the recent bad price action, we are going to reduce the position in V from 30% to 10%.  We still like V and We will buy more V if it breaks above the recent high of $104.

Also, as we have a leveraged ETF (TNA) in our portfolio, we are not looking to add more volatile stocks. Instead, we will be focusing on large-midcap stocks which have less volatility and decent upside to balance out the volatility. This way we can reduce the risk in our portfolio and make money at the same time.

We like couple of large cap oil service stock charts that broke out recently and are still in the buying range. NOV broke out around the $74-$75 area and is within the acceptable 5% range. Note that the 50 day got above the 200 day and the 200 day seems to be flattening. We will be opening a 10% position in NOV. OXY has a similar chart and we will be opening a 10% position in OXY.

CAT has been acting very well even when the market is flat. We increased our position from 5% to 15% in CAT today.

We like the double bottom breakout of CAT here. The buy point is rougly around the $100 area. We will be buying CAT on pullbacks. Our target is around the $135 area(30% profit).

The market looks to be slowly grinding higher. We expect it to continue to new highs. In the mean time, the situation with the breakouts look to be improving. While the breakouts are not staging powerful runs yet, there are no breakout failures yet. Hence we are very selective with the stocks at this point. We want to see couple breakouts succeed before buying more breakouts. Our TNA is working great as we bought the recent market pullback when TNA pulled back to $45 level. We will continue to stay with TNA. We have a 15% position in TNA. We also have a big (30%) position in V. V broke out recently around the $96-$98 area and rallied to $103 area. It then has pulledback towards the $98 level. We expect V to go up from here, but as V is a large cap , the run wil be little slow. The key is to be patient and buy the pullbacks in V.

We used the market weakness since yesterday to add to V and opened a 10% position in TNA this morning. We have 30% V and 10% TNA. We will look to add to TNA on any pullback. It looks like the market is favoring the large caps(like MSFT) and most of the small/mid caps look dead in the water. Hence we will be focusing mostly on the large caps to buy at this point. Some of the mid caps and small caps might work, but the odds are not in favor at this point. It’s best to stick with little bit of TNA(broader market bet) and V(large cap that broke out recently and look to be consolidating the breakout).