Sunday, July 08, 2007

Long and Short Stock picks for Monday July 9, 2007

DREAMTAI Software Daily Report

as of : 2007_07_08

Stock List sorted by Power Rankings

Legal Note: For Education and Entertainment only

Please do more research before placing buy or sell orders
Usually stocks with Power ranking above 3 have a strong uptrend
Usually stocks with Power ranking below minus 3 [-3] have a strong downtrend

Usually stocks take support at 20 day moving average and 50 day moving average
Then either they resume their trend or crash through the Averages. Do not ignore the 20 and 50 day moving averages lines

Please... please... please... please... do not risk MORE THAN 2 percent of your capital on ANY SINGLE trade... THANK YOU!!

Stock Ticker Name	Power Ranking	Last Closing Price	Strategy	New Buy New Sell
SA	15.23	25.19	BUY 36 shares at 25.21 Put Protection Sell Stop at 19.68 First Profit Target=30.74 Total Investment=907.56
RVEP	13.44	14.47	BUY 37 shares at 15.77 Put Protection Sell Stop at 10.48 First Profit Target=21.06 Total Investment=583.49
ARTW	12.82	12	BUY 63 shares at 12.52 Put Protection Sell Stop at 9.36 First Profit Target=15.68 Total Investment=788.76
TF	8.26	14.67	BUY 84 shares at 14.69 Put Protection Sell Stop at 12.33 First Profit Target=17.05 Total Investment=1233.96
LGTY	8.11	12.31	BUY 105 shares at 12.62 Put Protection Sell Stop at 10.73 First Profit Target=14.51 Total Investment=1325.1
GMCR	8.07	92.04	BUY 14 shares at 92.53 Put Protection Sell Stop at 78.53 First Profit Target=106.53 Total Investment=1295.42
BTM	7.86	25.39	BUY 49 shares at 25.51 Put Protection Sell Stop at 21.43 First Profit Target=29.59 Total Investment=1249.99
AP	7.74	45.45	BUY 26 shares at 45.72 Put Protection Sell Stop at 38.17 First Profit Target=53.27 Total Investment=1188.72
BRP	7.16	71.21	BUY 17 shares at 71.88 Put Protection Sell Stop at 60.26 First Profit Target=83.51 Total Investment=1222.04
DXR	6.9	17.4	BUY 74 shares at 17.77 Put Protection Sell Stop at 15.08 First Profit Target=20.46 Total Investment=1314.98
CTRP	6.81	88.67	BUY 14 shares at 89.86 Put Protection Sell Stop at 76.41 First Profit Target=103.31 Total Investment=1258.04
TTF	6.42	12.8	BUY 120 shares at 12.96 Put Protection Sell Stop at 11.3 First Profit Target=14.62 Total Investment=1555.2
BBL	6.03	61.2	BUY 34 shares at 61.51 Put Protection Sell Stop at 55.66 First Profit Target=67.36 Total Investment=2091.34
BHP	6.02	65.28	BUY 31 shares at 65.52 Put Protection Sell Stop at 59.09 First Profit Target=71.95 Total Investment=2031.12
PVG	5.24	33.93	BUY 48 shares at 34.62 Put Protection Sell Stop at 30.48 First Profit Target=38.76 Total Investment=1661.76
CE	4.03	40.96	BUY 81 shares at 41.07 Put Protection Sell Stop at 38.63 First Profit Target=43.51 Total Investment=3326.67
JOUT	3.93	21.52	BUY 78 shares at 22.54 Put Protection Sell Stop at 19.99 First Profit Target=25.09 Total Investment=1758.12
RDC	3.57	43.89	BUY 56 shares at 44.05 Put Protection Sell Stop at 40.48 First Profit Target=47.62 Total Investment=2466.8
EWY	3.4	65.2	BUY 35 shares at 65.5 Put Protection Sell Stop at 59.82 First Profit Target=71.17 Total Investment=2292.39
OFSI<---- New Sell	-3.15	7.8	SELL 253 shares at 7.68 Put Protection Buy Stop at 8.47 First Profit Target=6.89 Total Investment=1943.04	OFSI<---- New Sell
HBOS	-3.5	14.19	SELL 161 shares at 14.03 Put Protection Buy Stop at 15.27 First Profit Target=12.79 Total Investment=2258.83
ROX	-5.39	5.17	SELL 263 shares at 5.11 Put Protection Buy Stop at 5.87 First Profit Target=4.35 Total Investment=1343.93
REDE	-5.4	6.03	SELL 277 shares at 6 Put Protection Buy Stop at 6.72 First Profit Target=5.28 Total Investment=1662
FAVS<---- New Sell	-6.37	2.02	SELL 240 shares at 1.88 Put Protection Buy Stop at 2.71 First Profit Target=1.05 Total Investment=451.2	FAVS<---- New Sell
TFR	-6.83	7.66	SELL 120 shares at 7.64 Put Protection Buy Stop at 9.3 First Profit Target=5.98 Total Investment=916.8
ELTK	-8.08	3.42	SELL 186 shares at 3.3 Put Protection Buy Stop at 4.37 First Profit Target=2.23 Total Investment=613.8
JRC	-8.55	4.25	SELL 499 shares at 4.17 Put Protection Buy Stop at 4.57 First Profit Target=3.77 Total Investment=2080.83
OVRL	-9.01	2.3	SELL 344 shares at 2.18 Put Protection Buy Stop at 2.76 First Profit Target=1.6 Total Investment=749.92
ACA	-10.7	10.93	SELL 118 shares at 10.73 Put Protection Buy Stop at 12.42 First Profit Target=9.04 Total Investment=1266.14
TRMP	-15.16	10.42	SELL 73 shares at 10.33 Put Protection Buy Stop at 13.05 First Profit Target=7.61 Total Investment=754.09

SA
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RVEP
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ARTW
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TF
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LGTY
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GMCR
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BTM
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AP
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BRP
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DXR
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CTRP
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TTF
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BBL
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BHP
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PVG
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CE
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JOUT
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RDC
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EWY
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OFSI
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HBOS
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ROX
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REDE
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FAVS
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TFR
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ELTK
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JRC
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OVRL
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ACA
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TRMP
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Wednesday, July 04, 2007

Where is the Stock Market headed : Fourth of July Special report

If you had noticed for past few weeks, the Dow Jones Industrial Average is being displayed as RED color bars in DreamTai.

What exactly is going on ? Maybe, we should take a closer look at the Dow Jones Index and try to see where the market may go in the weeks ahead.

Please note that we are not going to predict the market. No one can predict the market. Rather, we are going to position ourself so that we can make profits if the market goes our way.

I have shown a screenshot of Dow Jones Index as charted in TradeStation.

In it, I have drawn three moving averages : 10 day average, 20 day average and 50 day average.

Usually, if a stock is in a strong uptrend, it just kisses the ten day moving average and then flies up.

As it becomes weaker, it goes down to the 20 day moving average, kisses it and then goes up slowly.

As it becomes more weak, it goes to the 50 day moving average, kisses it and then crawls up.

Eventually, the stock becomes too weak to get support at the 50 day moving average.

At that time, one of two things can happen.

1. In first scenario, the stock will just chop around up and down in a drunken stupor, because it does not know what to do or where to go and the market participants are neither supporting the bulls nor the bears.

2. in the second scenario, the stock will cross the 50 day moving average downwards and will turn the trend to bearish in a neat manner. Then, it will rise upwards to kiss the 10, 20 or 50 day moving average before going down again.

In the figure, at points A, B, C, D and E, the price just kissed the 20 day average and rose up again.

Point F was a shocker. no one expected the price to suddenly drop below the 50 day moving average. it dropped suddenly and was in a state of confusion until point G.

After point G, it again resumed its uptrend. Notice at points H, I and J, the price just kissed the 10 day moving average line and then zooms up.

At point K, the price was slowing down. It has started touching the 20 day moving average and going below it.

At point L, the situation has deteriorated. The price has started touching the 50 days moving average for support.
The price is failing to make a new high. it has recently formed two double tops. the second peak did not go higher than the first peak.

So, the best thing you can do now is to get your shorts ready.

If the market drops below the 50 days moving average,we can be ready for shorting the market.

Again remember, RISK CONTROL is the best policy. Do not risk more than two percent of your capital in any trade.

Sunday, July 01, 2007

Is Daytrading suitable for me ?

Question from a customer:

I want to do day trading for a living. is it possible for me ?

Answer:

I do not know. It depends on you.

1. Do you have enough capital to trade for a living. At least $100,000
2. Do you have money to survive without any income for at least one year.
3. Do your family members support your decision ?
4. Are you profitable doing Swing Trading ?
5. can you manage risks and emotional ups and downs ?
6. Do you have a risk management program in place?

Level two day trading is fast and furious. You can make lots of money or lose lots of money.

Remember the day trading boom of 2000, when everyone tried to make money in day trading. As long as the market was going up, it looked so easy, but when the market went down, they were wiped out.

Many proprietary trading shops lure traders by offering low commissions for trades. Then, once you are a customer, they force you to do many trades in your account because they want to make commissions. Do not fall into this trap. You should be able to take a trade only if you feel like it and you feel that the setup is correct.

Also, keep a fixed daily losing limit. If you lose x amount of dollars for the day, then you will just get out of the trading room and only trade the next day.

Whatever method you use to trade, as long as you maintain strict risk control, it will be really difficult to lose all your money in day trading.

Have a look at the following website

http://www.rsofhouston.com/

I have heard varying opinions about them.
They have a few setups which they trade consistently.
Have a look at their website and you decide if you want to use them.

One coaching person I really like is Tony Oz. i like him only because he places the correct stress on how to handle risk. His stock trading course is on the following page.

http://www.tonyoz.com/stock_trading_course.html

I have taken this course and i can say that it is good and inexpensive. You can get free stock risk calculator program from his website at the following web page

http://www.tonyoz.com

This software calculates the stock quantity to buy so that your risk per trade is less than two percent of your capital. Again this concept is nothing new for Dreamtai members.
You can calculate this manually using a calculator or in Excel spreadsheet.

You can start with swing trading and then if you have good win loss ratio and are making profits, you can shift to lower time frames.

Here is another trading website for Active Traders that you will find useful

http://www.elitetrader.com

Just a note: DreamTai is not affiliated with any of the above sites

Sunday, June 24, 2007

Stock picks for Monday June 25, 2007

The Dow Jones index ( ^DJI ) is dangerously close to the 50 day moving average.

If the Dow Jones Industrial Average Index goes below the 50 days moving average, we shall assume that the trend has turned bearish and concentrate more on finding stocks to shorts.

Here are some stock picks ( Both long and shorts)

DREAMTAI Software Daily Report

as of : 2007_06_24

Stock List sorted by Power Rankings

Legal Note: For Education and Entertainment only

Please do more research before placing buy or sell orders
Usually stocks with Power ranking above 3 have a strong uptrend
Usually stocks with Power ranking below minus 3 [-3] have a strong downtrend

Usually stocks take support at 20 day moving average and 50 day moving average
Then either they resume their trend or crash through the Averages. Do not ignore the 20 and 50 day moving averages lines

Please... please... please... please... do not risk MORE THAN 2 percent of your capital on ANY SINGLE trade... THANK YOU!!

Stock Ticker Name	Power Ranking	Last Closing Price	Strategy	New Buy New Sell
NVDA	8.98	43.62	BUY 41 shares at 43.89 Put Protection Sell Stop at 39.03 First Profit Target=48.75 Total Investment=1799.49
EXPE	8.76	29	BUY 48 shares at 29.2 Put Protection Sell Stop at 25.09 First Profit Target=33.31 Total Investment=1401.6
DO	5.9	107.13	BUY 23 shares at 107.31 Put Protection Sell Stop at 98.87 First Profit Target=115.75 Total Investment=2468.13
RIG	4.97	109.2	BUY 29 shares at 109.22 Put Protection Sell Stop at 102.46 First Profit Target=115.98 Total Investment=3167.38
SLB	4.81	89.2	BUY 34 shares at 89.22 Put Protection Sell Stop at 83.4 First Profit Target=95.04 Total Investment=3033.48
GW	3.56	8.6	BUY 370 shares at 8.62 Put Protection Sell Stop at 8.08 First Profit Target=9.16 Total Investment=3189.4
NE	3.44	98.75	BUY 49 shares at 98.84 Put Protection Sell Stop at 94.83 First Profit Target=102.85 Total Investment=4843.16
GSF	3.36	73.7	BUY 68 shares at 73.79 Put Protection Sell Stop at 70.89 First Profit Target=76.69 Total Investment=5017.72
^DJI	-0.03	13360.26	SELL 0 shares at 13359.67 Put Protection Buy Stop at 13735.1 First Profit Target=12984.24 Total Investment=0
USB	-0.97	33.42	SELL 180 shares at 33.36 Put Protection Buy Stop at 34.47 First Profit Target=32.25 Total Investment=6004.8
RF	-1.85	33.52	SELL 157 shares at 33.44 Put Protection Buy Stop at 34.71 First Profit Target=32.17 Total Investment=5250.08
SBUX	-4.1	25.54	SELL 78 shares at 25.48 Put Protection Buy Stop at 28.02 First Profit Target=22.94 Total Investment=1987.44
SEPR	-5.35	42.91	SELL 55 shares at 42.8 Put Protection Buy Stop at 46.42 First Profit Target=39.18 Total Investment=2354

NVDA
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EXPE
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DO
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RIG
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SLB
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GW
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NE
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GSF
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^DJI
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USB
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RF
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SBUX
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SEPR
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Sunday, June 17, 2007

Question by Rajesh

From Rajesh:
Dear Sanjoy, Pl send me the best book for trading for Indian Stock market Conditions

Answer:
Hi,
All the stock markets regardless of which exchange they are traded in, behave the same because the underlying human emotions - fear and greed

One of the books I like is :

"Trading for a living" by Dr. Alexander Elder.

It stresses the importance of risk management. Many people think that position entry is the most important aspect of a trade. Actually it is just one of the aspect. How you size your positions, how you manage risks and how you exit from a trade, your psychological state of mind, your discipline all factor to determine whether you will be successful trader or not.

At present I am reading the book
"Trade you way to Financial freedom" by Van Tharp.
(See the review in the article just below this one )

In that book, he makes entry into a trade by a Random trading system...that is the system just enters randomly..but still manages a positive return by risk control and position sizing.

Using Dreamtai system, we enter trending stocks with high liquidity. We manage our risk to less than two percent of total capital and position size our trades to reflect that.

Another book I love is "Market Wizards" by Jack Schwager
It gives interviews with top traders. If you read that, you will notice that many of the traders stress more on risk control than on any other secret systems or formulas.

Hope you find this information useful.

Sanjoy

Sunday, June 10, 2007

Prasan's Choice book

Our DreamTai member Prasan recommends the following book :

PRASAN : "One book I would recommend for the fundamental traders is " Frank Cappiellos's New Guide to finding the next superstock
It should be in all traders library." .

Book Review: Trade your way to Financial Freedom

Here is a reviw of an excellent book I have read recently.
The book name is "Trade your way to Financial Freedom" by Van Tharp.

From the book's title, it sounds like a typical get - rick - quick "How to make millions in a month" type book

Actually, the book is quite informative and interesting and is meant for serious investors.

The main focus of this book is on developing your own trading system, discipline and risk control.

May investors are looking for the Holy Grail....that secret entry technique ..that exact point at which the market will turn in their direction. They neglect other parts of a trading system as setting risk management, setting stop losses, deciding when to exit and how many shares to buy or sell.

He shows with examples, that it does not matter what system you use, - fundamental analysis, swing trading, scalping, following news letters, but as long as you have proper risk control, you can have positive returns in the market.

This book is filled with sound trading ideas.
In short: I recommend that you buy it, study it and implement the ideas given in this book.

Read the ideas about position sizing: that is, you vary the amount of shares to but or sell depending on the risk.
In DreamTai, we employ position sizing to keep risk less than 2 percent of the capital.

Short Selling Stocks

Here are some really good articles about shorting from Trader Mike blog

1. The Very Basics of ShortSelling

2. How to make Money selling stocks Short

If you have read our Stock Kisses article, you will remember that if a stock goes below 50 days moving average line ..that is the pink line in DreamTai, then it is an ideal candidate for shorting

Stock Kiss Article 1

Stock Kiss Article 2

Saturday, June 09, 2007

Risk Control and Monkey Behaviour

One of the most important aspect of trading is Risk Control.

No matter which system you use, you must be able to control your risk.
Sometimes, it becomes very tempting to bet the farm on a trade that looks like it is going to win big time.
At this time, you have to control your instincts. The ideal amount to risk in any trade is maximum two percent of your capital.

Here are some interesting articles about monkey behaviour which leads us to wonder about human behaviour and how we can use the "herd behaviour" and profit in trending stocks.

Gambling Monkeys Compelled by Winner's High

Ancient Behaviors Hard-Wired in Human Brain

Monkeys Pay to See Female Monkey Bottoms

Sunday, June 03, 2007

Stock Picks for Monday June 4, 2007

DREAMTAI Software Daily Report

Posted by dreamtai at 7:17 PM
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Sunday, July 08, 2007

SA

RVEP

ARTW

TF

LGTY

GMCR

BTM

AP

BRP

DXR

CTRP

TTF

BBL

BHP

PVG

CE

JOUT

RDC

EWY

OFSI

HBOS

ROX

REDE

FAVS

TFR

ELTK

JRC

OVRL

ACA

TRMP

Wednesday, July 04, 2007

Sunday, July 01, 2007

Sunday, June 24, 2007

NVDA

EXPE

DO

RIG

SLB

GW

NE

GSF

^DJI

USB

RF

SBUX

SEPR

Sunday, June 17, 2007

Sunday, June 10, 2007

Saturday, June 09, 2007

Sunday, June 03, 2007

DREAMTAI Software Daily Report

WNR

CLF

PLPC

FRO

JCG

AGE

MRO

LFG

NVT

WSO

SDA

EV

FTO

FCX

ESGR

TD

EON

CIG

NFX

USM

PKX

ESL

MSM

MT

IR

PH