May 14, 2008

The stocks in today's report:

Full disclosure: John Deere (DE), Texas instruments (TXN), Honeywell (HON), and Proshares Ultra Dow 30 (DDM) are integral parts of our Strategic Plan.  Our Strategic Plan is an alternative investment strategy designed to take advantage of 2-3 month market cycles.  Learn more about our Strategic Plan by  reviewing the performance table to the right.

The market is in a solid uptrend, but in accordance with the bylaws of our Strategic Plan we need to be proactive with our trading strategy.  We bought near support levels in February and we are now looking to sell near resistance levels.  For our members and trial members our sell signals are quite clear.  Our Strategic Plan integrates market based reversal triggers and we use those as market timing signals to buy, sell, or short respectively.  We are currently looking for a sell signal.

The individual stock analysis offered below should be used as a complement to the detail in our Strategic Plan.  In other words, our resistance based reversal trigger is our sell/short signal and it takes precedence over the sell signals offered in our individual stock analysis.

Honeywell (HON) Honeywell is rapidly approaching a level of longer-term resistance.  Our position in HON as it relates to the Strategic Plan is well in the money.  However, because our sell signal for the Strategic Plan is based on market levels, not individual stock levels, we will not sell Honeywell based on a test of its resistance level unless  unless that test of resistance coincides with our resistance based reversal trigger for the market too.  With that understood, please identify resistance in Honeywell with the Strategic Plan so that you understand our methodology completely.  We have identified longer-term resistance as longer-term parameter #3 in our real-time trading report.  After reviewing the report you can see that Honeywell is within striking distance of this resistance parameter.  If the market continues higher to our reversal trigger we expect Honeywell to follow by breaking above its respective resistance level in seamless flow with market direction.  However, this resistance level should still be respected; if nothing more you should be aware that the stock is poised to test its technically based resistance level son.  Click here for details: HON Report

Proshares Ultra Dow 30 (DDM) This double weighted Dow 30 ETF is set up to retest longer-term resistance levels.  We have identified resistance as longer-term parameter #3 in our strategic trading report.  Again, we are holding nice gains in this position.  However, we do not intend on selling our stake in DDM until such time as the market offers us signals to do so.  These signals are based on the reversal trigger offered in our Strategic Plan, so make sure that you understand that in detail.  Then review our report to learn where longer-term resistance exists in DDM by reviewing reviewing longer term parameter #3, but don't let that confuse the discipline offered by our Strategic Plan; use the reversal trigger in the Strategic Plan as your sell signal: DDM Report

Texas Instruments (TXN)  Shares of Texas instruments (TXN) are poised to test longer term resistance levels soon.  We have identified resistance as longer-term parameter #3 in our real-time trading report for Texas instruments.  Our combined market analysis tells us that the market is likely to trend higher from current levels and test the resistance-based reversal trigger as offered in our strategic plan.  If this happens Texas instruments is likely to blow past longer-term resistance levels as the Market trends higher.  Treat longer term parameter #3 as a key inflection parameter, however.  If longer-term resistance holds the stock is likely to oscillate lower again within the extremely tight relative channel that we have witnessed for the past few months.  However, if longer-term resistance breaks higher Texas instruments is likely to surge; if the Market increases to our Strategic Plan - reversal trigger we would expect TXN to follow.  With our resistance-based reversal trigger Intel, review our report for Texas instruments so that you understand where resistance lies: TXN Report

John Deere (DE) shares of John Deere are floundering within a midterm neutral trading channel.  Initially, the stock appears poised to increase towards longer-term resistance, but each time the stock has attempted to do this it has failed to pass mid-term resistance levels first.  This validates the midterm trading channel referenced above and offers additional insight: because the resistance line of that midterm channel was tested most recently additional declines from current levels are likely before the stock tests the support line of its near-term trading channel again.  Our analysis suggests that DE may experience slightly lower levels before it stabilizes and returns to test midterm resistance levels again.  If you are following this stock in relation to our strategic plan you should not consider this a sell signal, but you should be aware of our outlook specific to DE and your should recognize that slightly lower levels are likely in our opinion, before the stock moves up again.  Review mid term support, which has been defined as mid term parameter #1 in our report, for details.  Click here to read the report: DE Report

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Good Trading

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