Here’s another quick trading idea as right now MTSI – Macom Technology is one of the best looking semiconductor stocks out there. The stock is trading at an all time high. The stock also closed near its all time high. When this happens before a long weekend it is a very bullish sign as traders holding the stock display a lot of conviction. Overall we have a clean and very bullish technical picture. There is no overhead resistance. Everybody that bought the stock in the past and held on to it is now in the green. From a purely technical and psychological perspective there is no reason to sell. This makes MTSI a ‘Blue Sky Potential’ stock. Based on the chart pattern a conservative price target of 28$ looks like a high odds proposition.

Click on chart to enlarge:

Always up-to-date MTSI – Macom Technology chart on my public list.

MTSI – Macom Technology company description from Yahoo Finance:

M/A-COM Technology Solutions Holdings, Inc., through its subsidiaries, designs, develops, manufactures, and markets semiconductors and modules for use in wireless and wireline applications across the radio frequency, microwave, and millimeterwave spectrum. It offers approximately 2,700 standard and custom devices, which include integrated circuits, multi-chip modules, power pallets and transistors, diodes, switches and switch limiters, passive and active components, and complete subsystems across 37 product lines. The company’s semiconductor products are electronic components used in electronic systems, such as point-to-point wireless backhaul radios, radars, automobile navigation systems, digital cable television (CATV) set-top boxes, magnetic resonance imaging systems, and unmanned aerial vehicles. It serves approximately end customers, such as systems manufacturers, original equipment manufacturers, contract manufacturers, and distributors in various markets, including CATV, cellular backhaul, cellular infrastructure, fiber optic applications, aerospace and defense, automotive, industrial, medical, mobile communications, test and measurement, and scientific applications scientific applications. The company sells its products and solutions through direct sales force, applications engineering staff, independent sales representatives, and distributors primarily in the United States, Asia, and Western Europe. M/A-COM Technology Solutions Holdings, Inc. was incorporated in 2009 and is headquartered in Lowell, Massachusetts.

To make money trading, you do not need to forecast the future. You have to extract information from the market and find out whether bulls or bears are in control. You need to measure the strength of the dominant market group and decide how likely the current trend is to continue. You need to practice conservative money management aimed at long-term survival and profit accumulation. You must observe how your mind works and avoid slipping into greed and fear. A trader who does all of this will succeed more than any forecaster. – Alexander Elder

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We are trading at new all time highs. The Biotech ETFs IBB – iShares Nasdaq Biotechnology Index Fund and FBT – First Trust Biotechnology Index Fund have done it. This is something you should pay close attention to. Why is that you might ask… It’s really simple. So many are screaming overvalued, unsustainable, parabolic blow-off top, double top in the making to name but a few. Price has proven them wrong for quite some time and keeps proving them wrong. This is significant as the situation could develop into one of the best trading opportunities in quite some time. With every new all time high the pressure increases. Higher prices will induce those on the sidelines to give in and chase, shorts will have to cover if positions keep moving against them. That is the fuel that is needed for parabolic blow-off moves to unfold.

Is it really going to happen? Frankly, I have no idea. I see new all time highs and proper pattern pressure. IBB is displaying a very bullish ascending triangle in the making. My job is not to fight strong trends. My job is to go with the flow and take the path of least resistance. The charts will tell me when to get out. I manage my risk, there is really not much else I can do.

As I have stated before: ‘You can either lose your opinion or your money’. Put another way: ‘Trade what you see, not what you think’.

Trading is not about ‘being right’ or stubbornly sticking to your opinions or positions. ‘I told you so’ is not going to make you money. Instead, focus on going with the flow. When price confirms you are right, stick with your positions. When price proves you wrong, forget about your ego, get out and move on.

Click on chart to enlarge:

Always up-to-date IBB – Biotech ETF chart on my public list.

Technically speaking one could argue that the chart of FBT is even stronger. What I am specifically referring to is the fact that FBT gapped above its former all time high levels. Add proper pattern pressure to the mix and you have one of the most bullish constellations the market has to offer. Odds are the true parabolic move is yet to come.

Keep in mind though FBT is holding only around 20 positions and is therefore much more concentrated than IBB which offers a lot more diversification. In a nutshell, if the fund managers keep doing a good job FBT should outperform. If they don’t, things can change pretty quickly. If the Biotech sector is about to enter a true parabolic move I think speculation in mid-cap Biotechs will increase and traders will focus less on the big cap names like GILD – Gilead Sciences, AMGN – Amgen, CELG – Celgene, BIIB – Biogen Idec, REGN – Regeneron Pharmaceuticals etc. XBI – SPDR S&P Biotech Index ETF is the one Biotech ETF that offers the best exposure for the aforementioned scenario. It is holding around 50 almost equally weighted positions in big and mid-cap biotech stocks.

Have the courage to say no. Have the courage to face the truth. Have the courage to do the right thing because it is right. – W. Clement Stone

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Quick trading idea as TWTR – Twitter looks like it has put in a bullish ‘Island Reversal’ bottoming pattern that is part of a bigger bullish inverted head and shoulders reversal chart pattern. As you can see in the chart the huge volume spikes created equally impressive gaps. The technical term for the trading that took place between those two gaps is called an ‘Island’. When islands are clearly visible they often signal a meaningful reversal pattern. Although it is too early to tell, TWTR sure looks like wants to go higher now. If we get follow through it might emerge as one of the new big cap leading stocks.

Click on chart to enlarge:

If volume and price increase, this would validate the bullish pattern. The inverse head and shoulders pattern implies a conservative price target around 60$.

It’s OK to be wrong; it’s unforgiving to stay wrong. – Martin Zweig

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One of the emerging markets with a clearly bullish looking chart pattern is India. There are several ETFs available for trading: PIN, INDA, IFN, SCIF, INDL to name but a few. The PIN – Powershares India Portfolio ETF has formed a bullish weekly flag continuation chart pattern. It looks like a break out to the upside is imminent. The ABC pattern I highlighted would imply a price target around 25 – 26$. That would coincide with a touch of the long term trend line you can see on the chart.

Click on chart to enlarge:

Always up-to-date IFN – India Fund Chart on my public list. IFN and PIN look pretty much the same.

For all things related to India, trading and trading psychology I read Sudarshan Sukhani’s ‘Trading Steps’. This is the only website from India I follow. I recommend it.

Happy Independence Day India!

We owe a lot to the Indians, who taught us how to count, without which no worthwhile scientific discovery could have been made. – Albert Einstein

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Almost  2 years ago FNV – Franco Nevada was trading near its all time high and I wrote the following post: FNV – Franco Nevada Leading Precious Metal Stock. Today we have almost the exact same situation. FNV is the strongest big cap precious metal stock out there and it is again trading close to its all time high. Today FNV announced a 500 Million bought deal financing at 59.75 US$. The way I see it, this was probably the last opportunity for institutional investors to buy into FNV without moving the stock’s price through open market buying. Again, my opinions do not matter. What matters though is FNV’s chart. FNV is now all cashed up. It is trading within inches of its all time high. The bought deal was done at a decent price. This means the highest odds proposition is for FNV to be the leading big cap precious metals stock during the next gold rally. I believe the bought deal pricing at 59.75 US$ should provide a decent floor. Price should not dip significantly below that level. As long as the stock acts well these levels should be used to initiate a position in FNV. If FNV subsequently manages to take out its all time high that would be an area where additional buys would make sense. I already own positions in FNV and RGLD and plan to buy more if FNV prints new all time highs.

Remember: ‘A leader needs to lead.’ I only expect a decent gold rally if FNV can indeed assume a leadership role. Given the recent bought deal I assume the stock will digest the news for a few days and then FNV should be the go to stock for institutional precious metal investors.

Click on the FNV Franco Nevada chart to enlarge:

Always up-to-date FNV – Franco Nevada Chart on my public list.

Keep in mind FNV is a royalty company. For all those who are not familiar with the advantages of royalty companies, a few years ago I wrote an article highlighting the main companies: Precious Metal Royalty Companies Overview. Not much has changed. Both FNV – Franco Nevada and RGLD – Royal Gold look very good and will most likely be leaders in the coming precious metal bull market cycle.

To anticipate the market is to gamble. To be patient and react only when the market gives the signal is to speculate. – Jesse Livermore

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HAWK Blackhawk Networks – Stock Trading Idea Near Its All Time High

August 13, 2014

Quick post highlighting a stock trading idea near its all time high. Overall HAWK – Blackhawk Networks looks very constructive. The chart displays a thrusting move and a triangle consolidation right below the all time highs. Technically speaking the trend leading into the triangle pattern should resume soon. That would give us a likely target [...]

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STLD Steel Dynamics + X United States Steel – New Leading Steel Stocks

August 10, 2014

Two steel stocks have recently reacted well to earnings. They both have gapped higher on above average volume indicating a potential change in trend and sentiment. Technically speaking these two have the greatest odds to be the new leading stocks in steel. The two stocks I am talking about are STLD – Steel Dynamics and [...]

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WLT Walter Energy Coal Stock – Potential Short Squeeze Opportunity

August 5, 2014

Today I bought a position in WLT and subsequently posted my thoughts on Twitter. WLT – Walter Energy a coal stock is offering a compelling short squeeze opportunity. The stock closed near its high of the day so that is a positive sign. If we get more follow through tomorrow and the stock proceeds to [...]

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Gold Miners $HUI Chart Trading At Technical Inflection Point – GDX GDXJ NUGT JNUG

July 29, 2014

Interesting times ahead. The Gold Bugs Mining Index $HUI has reached another very important inflection point. As you can see in my annotations, this time around I do believe that the bullish scenario is the most likely one. If we get some more follow through this could trigger a sustainable up-move  using the bullish inverted [...]

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UNG Natural Gas ETF Potential Long Term Trend Reversal

June 13, 2014

Now this is what I call a smooth set-up. The weekly UNG Natural Gas ETF chart implies a significant change has happened. The volume pattern is all you need to look at to see that perception has changed. A new uptrend might be in the making. The recent surge occurred on huge volume. What is [...]

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