The ShadowTraderPro Swing Trader is your every morning dose of market reality brought to you from the resident geniuses at ShadowTrader. Each issue contains a full report on the prior day's action, including market internals, technicals, and what sectors were hot and cold. Each issue also includes the ShadowTraderPro Model Portfolio, which updates members on what stock plays STPro is currently engaged in officially, as well as provide a daily list of long and short setups for more self-directed traders and investors.

Good morning traders. Let's go right to the chart below.

The coal sector ($DJUSCL) broke out of a sideways pattern on the daily chart yesterday (not pictured) and above the midpoint high of the double bottom on the weekly chart above. Some component stocks in the sector have already taken off with it, but Alpha Natural Resources, Inc. (ANR) is still in a position where traders can catch a long entry for a follow through higher. Please observe the next chart below.

ANR closed at the top of the six day range outlined on the chart above. If $DJUSCL) continues higher, it is just a matter of time before ANR breaks out to follow the pack higher.

When we say "under the hood" we mean market internals, ie: what was really happening behind the scenes. ShadowTraders who listen to our daily broadcast every day live on the thinkorswim platform know that all closing figures on the major averages should only be interpreted in the context of market internals. Look for convergences and divergences in the breadth, a/d line, and trin figures below to either confirm or cast doubt on what all those talking heads on TV are telling you.

The ShadowTrader Sector Trend Score matrix is a proprietary method of assigning values to twenty five sectors that are a representative cross-section of the market as a whole. The heat map in the trend score column defines the current strength or weakness of that sector using a proprietary weighting formula. Sectors bolded in green and red are the two sectors that experienced the largest absolute gain and loss in trend score over the prior day. We strongly urge subscribers to read the full explanation of the meaning and calculation of the trend scores in the Swing Trader User's Guide.

ShadowTrader Sector breadth remained bullish by a measure of 19 to 6 yesterday. XAL was higher for the eigth consecutive day and BTK was up for the fifth consecutive day. With one more bullish session today, the broad market will be close to an overbought reading.

$DJUSCL broke out of consolidation yesterday. This is discussed further in today's Looking Ahead section.

Up and coming economic and corporate data that may move markets this week:

This section is for self-directed traders and investors who like to "do it themselves". Every trading day, Bulls and Bears will list long and short equity setups with defined entries and stops. Note: A listing in this section does NOT necessarily mean that the stock will end up as a part of the ShadowTraderPro Model Portfolio. Plays listed here change daily and are not managed or tracked by ShadowTrader unless traded via MyTrade posting.

Long Ideas

Short Ideas

The matrix below shows all current ShadowTrader Pro plays in the Model Portfolio. The Model Portfolio contains only those plays that are sent out in real-time via posting to MyTrade or text message to your phone. Bulls and Bears plays above are not actively managed or tracked. Current open positions are on top, with positions that were closed in the current calendar week on the bottom. Closed positions are moved out of the matrix on Monday mornings and posted in our performance page here.

To get the most out of your subscription and for detailed instructions on how to structure your own portfolio, read our Swing Trader User's Guide

OPEN POSITIONS - week of 01/30/12 - 02/03/12
sym	dir	size	date entered	entry price	date closed	exit price	target	stop	status	mark to market	p&l points	p&l capital	capital commit
DELL	short	600	02/01	17.41	n/a	n/a	16.50	18.10	open	17.6	(0.19)	($114)	$10,446
	Consecutive topping tails on daily chart

The ShadowTraderPro Swing Trader is your every morning dose of market reality brought to you from the resident geniuses at ShadowTrader. Each issue contains a full report on the prior day's action, including market internals, technicals, and what sectors were hot and cold. Each issue also includes the ShadowTraderPro Model Portfolio, which updates members on what stock plays STPro is currently engaged in officially, as well as provide a daily list of long and short setups for more self-directed traders and investors.

Good morning traders. From the beginning of 2012 through the middle of January, stocks and the U.S. Dollar (/DX) were both trading higher. But since then, the dollar has fallen approximately 3.70% while the S&P 500 Index (SPX) has managed to maintain recent highs.

Since the FOMC announcement on January 25, 2012, the /DX and the broad stock market have traded inverse to one another. Let's check in with the chart of the /DX below to gain some additional foresight should this pattern continue in the near term.

Frankly we were a bit surprised /DX did not follow through higher after bouncing off the top of prior consolidation (blue line) the first two days of this week. Instead, yesterday's price bar formed a bearish engulfing pattern.

The sharper negative trajectory of the 20 day moving average (green line) and the price action over the past three days must have longs somewhat concerned. An undercut and close under yesterday's low will increase the probability that price will visit the low of prior consolidation at 78.01.

Even if stocks do not continue the very recent inverse correlation to the /DX, such a move by the /DX should at least help stocks retain recent gains.

On a related subject, check out our short video on yesterday's broad market money flow in the upper left block at ShadowTrader.net .

When we say "under the hood" we mean market internals, ie: what was really happening behind the scenes. ShadowTraders who listen to our daily broadcast every day live on the thinkorswim platform know that all closing figures on the major averages should only be interpreted in the context of market internals. Look for convergences and divergences in the breadth, a/d line, and trin figures below to either confirm or cast doubt on what all those talking heads on TV are telling you.

The ShadowTrader Sector Trend Score matrix is a proprietary method of assigning values to twenty five sectors that are a representative cross-section of the market as a whole. The heat map in the trend score column defines the current strength or weakness of that sector using a proprietary weighting formula. Sectors bolded in green and red are the two sectors that experienced the largest absolute gain and loss in trend score over the prior day. We strongly urge subscribers to read the full explanation of the meaning and calculation of the trend scores in the Swing Trader User's Guide.

RLX was the only sector that finished lower yesterday. XAL closed higher for the seventh consecutive day while CEX and BTK both were higher for the fourth consecutive day.

Up and coming economic and corporate data that may move markets this week:

This section is for self-directed traders and investors who like to "do it themselves". Every trading day, Bulls and Bears will list long and short equity setups with defined entries and stops. Note: A listing in this section does NOT necessarily mean that the stock will end up as a part of the ShadowTraderPro Model Portfolio. Plays listed here change daily and are not managed or tracked by ShadowTrader unless traded via MyTrade posting.

Long Ideas

Short Ideas

The matrix below shows all current ShadowTrader Pro plays in the Model Portfolio. The Model Portfolio contains only those plays that are sent out in real-time via posting to MyTrade or text message to your phone. Bulls and Bears plays above are not actively managed or tracked. Current open positions are on top, with positions that were closed in the current calendar week on the bottom. Closed positions are moved out of the matrix on Monday mornings and posted in our performance page here.

To get the most out of your subscription and for detailed instructions on how to structure your own portfolio, read our Swing Trader User's Guide

OPEN POSITIONS - week of 01/30/12 - 02/03/12
sym	dir	size	date entered	entry price	date closed	exit price	target	stop	status	mark to market	p&l points	p&l capital	capital commit
DELL	short	600	02/01	17.41	n/a	n/a	16.50	18.10	open	17.4	0.01	$6	$10,446
	Reversal play off prior high

The ShadowTraderPro Swing Trader is your every morning dose of market reality brought to you from the resident geniuses at ShadowTrader. Each issue contains a full report on the prior day's action, including market internals, technicals, and what sectors were hot and cold. Each issue also includes the ShadowTraderPro Model Portfolio, which updates members on what stock plays STPro is currently engaged in officially, as well as provide a daily list of long and short setups for more self-directed traders and investors.

Good morning traders. The end of the month always provides the opportunity to review monthly charts to help plan for the coming month.

Of all 25 sectors tracked by ShadowTrader, the healthcare index HCX looks to be one where a good number of short reversal setups could come into play during the month of February.

Please observe the chart below

HCX has closed higher each of the last four months. The index is now coming into its 52 week high at 421.69 and the 2007 high of 427.75.

We have set an alert at 421.50 to let us know when HCX is on the doorstep of the area where we could look for short trades in healthcare related stocks. We have scanned many stocks in this arena and have set alerts to be notified when the following names are very close to prior highs for final trade consideration.

When we say "under the hood" we mean market internals, ie: what was really happening behind the scenes. ShadowTraders who listen to our daily broadcast every day live on the thinkorswim platform know that all closing figures on the major averages should only be interpreted in the context of market internals. Look for convergences and divergences in the breadth, a/d line, and trin figures below to either confirm or cast doubt on what all those talking heads on TV are telling you.

The ShadowTrader Sector Trend Score matrix is a proprietary method of assigning values to twenty five sectors that are a representative cross-section of the market as a whole. The heat map in the trend score column defines the current strength or weakness of that sector using a proprietary weighting formula. Sectors bolded in green and red are the two sectors that experienced the largest absolute gain and loss in trend score over the prior day. We strongly urge subscribers to read the full explanation of the meaning and calculation of the trend scores in the Swing Trader User's Guide.

Our statistical tracking of the ShadowTrader Sector Trend Scores has triggered a short term bullish signal for the broad market as of Tuesday's close.

This indicator has been correct 21 of the last 28 signals as a predictor of a forthcoming short term move by the broad market. An indication is credited as being successful if within three days of the alert, the SPY closes above the closing price of the day the alert was triggered.

Up and coming economic and corporate data that may move markets this week:

This section is for self-directed traders and investors who like to "do it themselves". Every trading day, Bulls and Bears will list long and short equity setups with defined entries and stops. Note: A listing in this section does NOT necessarily mean that the stock will end up as a part of the ShadowTraderPro Model Portfolio. Plays listed here change daily and are not managed or tracked by ShadowTrader unless traded via MyTrade posting.

Long Ideas

Short Ideas

The matrix below shows all current ShadowTrader Pro plays in the Model Portfolio. The Model Portfolio contains only those plays that are sent out in real-time via posting to MyTrade or text message to your phone. Bulls and Bears plays above are not actively managed or tracked. Current open positions are on top, with positions that were closed in the current calendar week on the bottom. Closed positions are moved out of the matrix on Monday mornings and posted in our performance page here.

To get the most out of your subscription and for detailed instructions on how to structure your own portfolio, read our Swing Trader User's Guide

The ShadowTraderPro Swing Trader is your every morning dose of market reality brought to you from the resident geniuses at ShadowTrader. Each issue contains a full report on the prior day's action, including market internals, technicals, and what sectors were hot and cold. Each issue also includes the ShadowTraderPro Model Portfolio, which updates members on what stock plays STPro is currently engaged in officially, as well as provide a daily list of long and short setups for more self-directed traders and investors.

Good morning traders. We have three reversal plays listed as short ideas in today's Bulls and Bears section. One of these trades is a reversal play in International Business Machines (IBM). Please observe the chart below.

The horizontal magenta and yellow shaded lines border the price range IBM has traded within since early October 2011.

Although it is not pictured here, the stock closed trading yesterday with a daily bullish engulfing pattern. This increases the probability of a price move into the entry range illustrated on the weekly chart above.

Yesterday the broad market proved it's bullish resilience once again. Currently, we like these short reversal trades for gaining a few higher probability points without any expectation of price returning to the bottom of the recent range. If that were to happen, great. But as it stands now, we are happy to trail the reversal with a stop allowing the market to take us out of the trade in its own time.

When we say "under the hood" we mean market internals, ie: what was really happening behind the scenes. ShadowTraders who listen to our daily broadcast every day live on the thinkorswim platform know that all closing figures on the major averages should only be interpreted in the context of market internals. Look for convergences and divergences in the breadth, a/d line, and trin figures below to either confirm or cast doubt on what all those talking heads on TV are telling you.

The ShadowTrader Sector Trend Score matrix is a proprietary method of assigning values to twenty five sectors that are a representative cross-section of the market as a whole. The heat map in the trend score column defines the current strength or weakness of that sector using a proprietary weighting formula. Sectors bolded in green and red are the two sectors that experienced the largest absolute gain and loss in trend score over the prior day. We strongly urge subscribers to read the full explanation of the meaning and calculation of the trend scores in the Swing Trader User's Guide.

ShadowTrader Sector breadth was bearish yesterday by a score of 19 winners to 6 losers. By our measure, the broad market is now in a positon to move multiple days either higher or lower before reaching an overbought or oversold extreme. After ten consecutive days higher, $DJUSRE finally closed lower yesterday while XAL was higher for the fifth consecutive day.

Up and coming economic and corporate data that may move markets this week:

This section is for self-directed traders and investors who like to "do it themselves". Every trading day, Bulls and Bears will list long and short equity setups with defined entries and stops. Note: A listing in this section does NOT necessarily mean that the stock will end up as a part of the ShadowTraderPro Model Portfolio. Plays listed here change daily and are not managed or tracked by ShadowTrader unless traded via MyTrade posting.

Long Ideas

Short Ideas

The matrix below shows all current ShadowTrader Pro plays in the Model Portfolio. The Model Portfolio contains only those plays that are sent out in real-time via posting to MyTrade or text message to your phone. Bulls and Bears plays above are not actively managed or tracked. Current open positions are on top, with positions that were closed in the current calendar week on the bottom. Closed positions are moved out of the matrix on Monday mornings and posted in our performance page here.

To get the most out of your subscription and for detailed instructions on how to structure your own portfolio, read our Swing Trader User's Guide

The ShadowTraderPro Swing Trader is your every morning dose of market reality brought to you from the resident geniuses at ShadowTrader. Each issue contains a full report on the prior day's action, including market internals, technicals, and what sectors were hot and cold. Each issue also includes the ShadowTraderPro Model Portfolio, which updates members on what stock plays STPro is currently engaged in officially, as well as provide a daily list of long and short setups for more self-directed traders and investors.

Good morning traders. A remarkably greater amount of Friday's volume was transacted on down ticks than on upticks in all sectors we use to track broad market money flow. This is reflected on the chart below.

This broad based movement of money out of the market puts a higher probability on declining stock prices in the short term. As of Sunday evening, 9:30pm, S&P 500 Index Futures /ES have reached a low of 1304.50. However, we think the /ES could move down to the 1289.00 before finding support.

When we say "under the hood" we mean market internals, ie: what was really happening behind the scenes. ShadowTraders who listen to our daily broadcast every day live on the thinkorswim platform know that all closing figures on the major averages should only be interpreted in the context of market internals. Look for convergences and divergences in the breadth, a/d line, and trin figures below to either confirm or cast doubt on what all those talking heads on TV are telling you.

The ShadowTrader Sector Trend Score matrix is a proprietary method of assigning values to twenty five sectors that are a representative cross-section of the market as a whole. The heat map in the trend score column defines the current strength or weakness of that sector using a proprietary weighting formula. Sectors bolded in green and red are the two sectors that experienced the largest absolute gain and loss in trend score over the prior day. We strongly urge subscribers to read the full explanation of the meaning and calculation of the trend scores in the Swing Trader User's Guide.

ShadowTrader Sector breadth swung back to the bullish side on Friday by a margin of 19 to 6.. The $DJUSRE closed higher for the tenth consecutive day. XAL and RLX were both higher for the fourth day in a row.

Up and coming economic and corporate data that may move markets this week:

This section is for self-directed traders and investors who like to "do it themselves". Every trading day, Bulls and Bears will list long and short equity setups with defined entries and stops. Note: A listing in this section does NOT necessarily mean that the stock will end up as a part of the ShadowTraderPro Model Portfolio. Plays listed here change daily and are not managed or tracked by ShadowTrader unless traded via MyTrade posting.

Long Ideas

Short Ideas

The matrix below shows all current ShadowTrader Pro plays in the Model Portfolio. The Model Portfolio contains only those plays that are sent out in real-time via posting to MyTrade or text message to your phone. Bulls and Bears plays above are not actively managed or tracked. Current open positions are on top, with positions that were closed in the current calendar week on the bottom. Closed positions are moved out of the matrix on Monday mornings and posted in our performance page here.

To get the most out of your subscription and for detailed instructions on how to structure your own portfolio, read our Swing Trader User's Guide

CLOSED POSITIONS - week of 01/23/12 - 01/27/12
sym	dir	size	date entered	entry price	date closed	exit price	target	stop	status	mark to market	p&l points	p&l capital	capital commit
BEAV	short	500	01/20	42.95	01/24	41.54	40.75	44.05	closed	n/a	1.41	$705	$21,475
	Took profit in broad market that continues to show resiliance.
XHB	short	500	01/20	18.80	01/25	19.1	17.50	19.75	closed	n/a	(0.3)	($150)	$9,400
	Covered position on broad market strength
TOTALS:	0	open shares (open capital committed doesn't include closed trades)											$0.00

The ShadowTraderPro Swing Trader is your every morning dose of market reality brought to you from the resident geniuses at ShadowTrader. Each issue contains a full report on the prior day's action, including market internals, technicals, and what sectors were hot and cold. Each issue also includes the ShadowTraderPro Model Portfolio, which updates members on what stock plays STPro is currently engaged in officially, as well as provide a daily list of long and short setups for more self-directed traders and investors.

Good morning traders. Google, Inc. (GOOG) has traded down over 11% since reporting earnings on 01/19/12. We think there is an opportunity to capture gains on a bounce play back higher.

Please observe the chart below.

As of yesterday, GOOG has closed lower each of the past five days. There is a good chance the stock will move into the entry range between 562.00 and 559.00 today.

The stop loss for this long trade is set one average true range value (ATR Wilder (14)) below the bottom of the entry range. The stop loss should be moved up to trail price on a rebound back higher, particularly as GOOG gets closer to the bottom of the prior gap down (orange circle) which could act as near term resistance.

When we say "under the hood" we mean market internals, ie: what was really happening behind the scenes. ShadowTraders who listen to our daily broadcast every day live on the thinkorswim platform know that all closing figures on the major averages should only be interpreted in the context of market internals. Look for convergences and divergences in the breadth, a/d line, and trin figures below to either confirm or cast doubt on what all those talking heads on TV are telling you.

The ShadowTrader Sector Trend Score matrix is a proprietary method of assigning values to twenty five sectors that are a representative cross-section of the market as a whole. The heat map in the trend score column defines the current strength or weakness of that sector using a proprietary weighting formula. Sectors bolded in green and red are the two sectors that experienced the largest absolute gain and loss in trend score over the prior day. We strongly urge subscribers to read the full explanation of the meaning and calculation of the trend scores in the Swing Trader User's Guide.

ShadowTrader Sector breadth was bearish yesterday with seventeen closing lower and eight ending the day higher. The $DJUSRE closed higher for the ninth consecutive day while TOB was higher for the fifth consecutive day and $DJUSNS was lower for the fifth consecutive day.

Up and coming economic and corporate data that may move markets this week:

This section is for self-directed traders and investors who like to "do it themselves". Every trading day, Bulls and Bears will list long and short equity setups with defined entries and stops. Note: A listing in this section does NOT necessarily mean that the stock will end up as a part of the ShadowTraderPro Model Portfolio. Plays listed here change daily and are not managed or tracked by ShadowTrader unless traded via MyTrade posting.

Long Ideas

Short Ideas

The matrix below shows all current ShadowTrader Pro plays in the Model Portfolio. The Model Portfolio contains only those plays that are sent out in real-time via posting to MyTrade or text message to your phone. Bulls and Bears plays above are not actively managed or tracked. Current open positions are on top, with positions that were closed in the current calendar week on the bottom. Closed positions are moved out of the matrix on Monday mornings and posted in our performance page here.

To get the most out of your subscription and for detailed instructions on how to structure your own portfolio, read our Swing Trader User's Guide

CLOSED POSITIONS - week of 01/23/12 - 01/27/12
sym	dir	size	date entered	entry price	date closed	exit price	target	stop	status	mark to market	p&l points	p&l capital	capital commit
BEAV	short	500	01/20	42.95	01/24	41.54	40.75	44.05	closed	n/a	1.41	$705	$21,475
	Took profit in broad market that continues to show resiliance.
XHB	short	500	01/20	18.80	01/25	19.10	17.50	19.75	closed	n/a	(0.30)	($150)	$9,400
	Covered position on broad market strength
TOTALS:	0	open shares (open capital committed doesn't include closed trades)											$0.00