Sunday Set Ups 3/17/13

{+++}   “May you always have walls for the winds, a roof for the rain, tea beside the fire, laughter to cheer you, those you love near you and all your heart might desire.

Happy St. Paddy’s Day. Here are some setups for the week ahead. Quadruple witching came and went on Friday and it left the markets flat to slightly down for the day.

Everyone is talking about the crisis in Cyprus this weekend and there is actually a mini run on the banks over there.  It’s not so much the effect on Cyprus, but the fear of contagion across other Euro countries. I’ve seen this movie before, so I”m not worried. It will be interesting to see how the market reacts tomorrow though.  The market could use this episode as reason to pullback. Who knows?

As battle tested men and women of the markets, we will not let let this deter us. The long side is still the place to be until its not, so we’ll let the “sky is falling” crowd have their way this weekend until we see how it all shakes out. I have raised all stops on the P&L and I will stick to those stop prices for now.

We are overbought, no question. Someone made a great comment this weekend, I don’t know where I read it, but it is very insightful. He said, “Overbought is not a reason to sell, but it’s a reason to tighten stops and be very careful with entries on new swing positions”. Well said.

Here are a few long setups to watch this week. I also put out some short ideas (no specific entries or stops) in a free post that I did earlier today. You can find it on my blog.  They wont go on the P&L.

MHO– is in an earlier stage base than some of the other builders (late stage bases are more prone to fizzle). Buy the 26.40-26.50 level.


MGM– had a massive volume day on Thursday. Actually the most volume in over a year. Friday was a healthy inside day, and I wouldn’t be surprised if a bull flag started to develop over the next few days. Buy the 13.50 level for a breakout.


NRP— is rubbing up against nine month resistance, with great volume on Friday. It’s caught in a wedge and could break out at the 23.30 level.


Have a great night. See you in the morning.

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