Wang’s Happy Trading

It was a volatile day today. The DOW did make a new high today, but, couldn’t hold on to the gains. On the other hand, SP500 managed to close above 1530 and Nasdaq closed above 2600! The Nasdaq was particularly strong and kept most of its gains. As I indicated in this week’s forecast, I’m looking for techs to start taking leadership in this bull run. BTK continues to move up nicely, and SOX made a solid bounce today. Even GLD was able to close above 65!

GLD

GLD closed above 65 on high volume today. This looks real to me, as opposed to the past several sessions where GLD was treading water at the 65 level. Let’s see if it can start consolidate upwards. This might bode well for the metals sector for their next leg up, many of which had already started; for example, FCX has been making new highs for the past few days!

Nasdaq

As I predicted yesterday, Nasdaq made a nice advance and caught up with its daily upper BB. Its MACD has already turned positive, signaling the potential start of the next leg up!

SOX

SOX’s solid bounce today is very encouraging. It closed above the resistance at 485. The MACD is turning up. We’ll need to see it move above 495, which is about where the 30-day MA is.

BTK

BTK continues to move up and it is now above its daily MAs. We’ll look for it to catch up with its daily upper BB, which is just above 830, soon. It’ll, however, need to break above the 840 resistance to get the next leg up!

With both SOX and BTK moving up, I’m looking for Nasdaq to go higher. But, be cautious for the next couple of sessions. Tomorrow is Friday and the markets might need to let off some steam.

As many of you know, I have been publishing some of my trades in the “Happy Trades!!” section. I’m going to start dissecting some published trades so readers can get a sense of my reasoning for entering and exiting some specific trades.

BIIB (bought 5/29, OCT 55 calls; sold 1/2 5/31 with +25% gain)

BIIB caught my attention when the buyout rumors boosted it up on 5/23. It made a big jump but came back down. Two days later, 5/25, it made another jump and caught the daily upper BB. I didn’t buy then because I didn’t want to chase it. On 5/29, the next trading session, I bought on the pullback. I was lucky to have bought just before they announced the $3B stock buyback! Yesterday, BIIB jumped almost 6%. I didn’t sell because it cleared the resistance at 51.45. Today, it continued going up in late morning, and I took profits on 1/2 of my position and got the day high! The reason for taking the profits is that after 2 days of continuous gains, it might have to need to vent; but, I think this stock will go higher. So, I decided to take 1/2 off and let the other 1/2 ride.
The options that I bought are OCT 55 calls, which gives me a good 4+ months. I’m looking for the stock to be at least 60 by then, and depending on how the stock moves, I may exit and re-enter a few times. And, if I catch a buyout, great!! =)

CEPH (traded on 4/26 and 5/7)

CEPH got the nod to be added to Nasdaq100. I’ve traded this before and it just got interesting again! It moved up today on high volume and has caught up with its upperBB. I didn’t buy today and perhaps I should have, but, I didn’t want to chase the initial excitement. I might look to enter a trade tomorrow. Let’s see how this thing opens. I think CEPH can quickly go above 85.

Good night and HappyTrading! ™