ShadowTraderPro Swing Trader

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. On the day of options expiry, ShadowTrader likes to stay on the sidelines while large players unwind and adjust complex positions which sometimes have a misleading effect on stocks.

Let's take this opportunity to check in with the possible long opportunity developing in crude oil (USO).

Please observe the chart below.

The magenta lines on the chart above outline the sideways price action of USO over the past three months. As the etf approaches resistance off the recent higher low, we are monitoring it and crude oil futures (/CL) for signs of a higher probability breakout to the upside. Stay tuned.

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.

$DJUSHB was the only ShadowTrader Sector to close lower yesterday. For now, there is little to draw from recent sector price action that will aid in a near term broad market directional forecast. As the case has been all week, the broad market can move at least two days in either direction before reaching overbought or oversold conditions.

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 02/13/12 - 02/17/12
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
LMT	short	150	02/03	87.50	02/13	87.95	83.00	90.50	closed	n/a	(0.45)	($68)	$13,125
	Exited trade as stock showed no signs of following through lower
SCCO	long	425	02/14	32.66	02/14	31.91	37.27	31.50	closed	n/a	(0.75)	($319)	$13,881
	Cut trade on follow through below ascending trendline
TOTALS:	0	open shares (open capital committed doesn't include closed trades)											$0.00