The team at High Chart Patterns, which writes stock picks newsletters, wrote in with their thoughts on getting to know your stocks.

"Without a doubt one activity that many professional traders share is that they get to know their friends.  Stock friends, that is.   One of the most valuable things that we have learned over the years is how important it is to become familiar with the behaviour of your stocks.

For example, you have been watching stock HCPG for a break of 50 for over a week, 50 representing new highs.   For days you have followed the stock approach 50 from different angles, with different volumes, at different times of the day, only for it to be rejected near the buy point.   The next day HCPG is sitting at 49.5 in a flattish market.  Then, however, you notice the way she starts to climb up towards 50 this time is somehow different — this time you know that most likely it will successful.  How do you know?  Because you have become familiar with your friend and you note a behavior change.    At some levels it has to be sub-conscious; if a buddy sitting beside you asks what exactly was different, often it's difficult to pin down.  But from our own experience, we have no doubt how well it works.

This is the reason that we also place stocks whose patterns are not completely formed or are too far away, in the "secondary list" of our High Chart Patterns; so that subscribers can start watching them days before and familiarize themselves with the stock's behavior.  It is also the reason we like to stick to a core group of stocks, around 200 of them, instead of scanning each night through a 1500 stocks looking for patterns.  As a rule we never trade a stock that we are not familiar with.  If there is a new stock that is gaining attention from momentum traders, we immediately add it to our core group of stocks so that it too can become our friend."

Bloomberg is the latest source to report that AMD, Advanced Micro Devices, may make a $5.5 billion bid for ATI Technologies, ATYT.

GOOG, Google Inc., delivered some pretty good numbers after the bell today in its earnings report. WAY better than the numbers that YHOO, Yahoo Inc., delivered a few days ago.

Today, GOOG stock made a re-test of support portion of the symmetrical triangle. Considering that GOOG is trading up 6 pts after hours, it seems fairly certain that we will see a bullish bounce off the support tomorrow.

Keep a lookout for a symmetrical triangle breakout above $425 because that will be a very bullish buy signal.

With interest rates so high, and the markets so exasperating, many traders are staying in cash. 

Bankaholic lists some no-risk, fully liquid, high-yield money market and savings account rates that offer interest rates ranging from 5.25% APY to 6.00% APY. If the market continues to deteriorate, you might even want to think about locking away some of your cash at the current high interest rates in laddered CD accounts.

I personally plan on opening a 5.76% APY 10-month CD account at World Savings Bank this weekend. Also check out Chase's credit card which offers 6% back on gas purchases for 90 days and then 3% thereafter.

YHOO, Yahoo Inc., was a bloodbath yesterday. While the market made a huge rally, YHOO sold off 22%.

The stock has gone from neutral to bearish at the weekly leve. Today's volume was ENORMOUS, so I have a feeling the $25 support may not hold. If YHOO breaks the $25 support, it may head lower into the next support level.

CELG, Celgene Corp., continues to look strong even in this bear market.

A few weeks ago, I drew up a stock chart analysis when CELG made an ascending triangle breakout to all-time highs. After a 10% rally following the breakout, CELG retraced to the support. 

Today, CELG made a bullish bounce off the support, which reflects bullish sentiment on this stock.  

WFC, Wells Fargo & Co., broke out of a consolidation range today on big volume.

The XLF financial sector rallied today, so I looked through the top 10 XLF components to see which stock has the strongest chart. While almost every stock appeared to be on the verge of a consolidatory breakout, WFC had the strongest chart, so keep it on your watchlist.

Stocks surged across the board Wednesday as investors rallied around upbeat remarks from Bernanke that implied policy makers may finally take a breather after two years of interest rate increases. Aside from the Fed Chairman's seemingly dovish commentary that sent short sellers fleeing for cover following weeks of market losses, signs of a potential pause pushed bond yields to session lows and allowed equity investors to look beyond a disappointing CPI report, using solid earnings news and another pullback in oil as additional catalysts to get back into a market that was showing signs of being oversold.

(more…)

OKE, ONEOK Inc., has broken out of a bull flag pennant setup.

 I like how the support at around $35 held at the recent retrace. Also,the runaway gap is another bullish signal. The OBV on this stock also looks strong.

Keep an eye on OKE because it is a utility stock, and utilities are a strong sector right now. Check the $UTY Utilities Index to see what I mean. 

AAPL, Apple Computer Inc., has been selling off for months now.

I dont like the gapdown they had 3 days ago. The long upper wick on that day's candle signifies that the sellers are in control of AAPL stock.

GOOG, Google Inc., is hiring thousands of new employees around the world? This sign of aggressive growth comes a few days ahead of their quarterly earnings. I am excited to see how they performed last quarter. Keep an eye on GOOG stock this week.

XOM, Exxon Mobil Corp, is looking strong as it heads into the third retest of the $65 resistance.

XOM has been rallying the last couple days while the markets have been bleeding. Also remember that "LONG BASES MAKE FOR BIG BREAKOUTS." Notice that the chart I put up today is a WEEKLY chart. XOM has been consolidating for a long time and is ready for another bull run.

These oil stocks are crazy. You can make so much right now trading oil futures commodities.  

From Yahoo News:

Set to launch on July 18, InstantBull lets investors sift through the most popular stock message boards at Yahoo Finance, Raging Bull, and SiliconInvestor, to name a few.

InstantBull also aggregates news, blogs, and vital financial stats for publicly traded companies. You need to click just once or scroll over an item to make it appear on the screen. The site is lightning fast, and there's no software to download to get started. Oh yeah, it's free.

I just wanted to point out this service that I use. I use Instantbull daily when I need to research a stock REALLY fast, so take a look at InstantBull.

I noticed that a lot of headlines in the wires today were talking about how the Nasdaq QQQQ index is making new lows. I did a quick short-term and long-term analysis of the QQQQ ETF chart. The chart is telling me that we are officially bearish short-term and neutral (with bearish bias) long-term. 

NI, Nisource Inc., stock showed up on my stock chart program as an ascending triangle breakout.

The breakout looks clean, and has retraced to the support. Watch this stock for a possible trading opportunity. I hope the markets can recover, but I don't think it will happen.

FIZ, National Beverage Corp., is breaking out to all time highs today.

Nice volume as well. Keep this stock on your watchlists for a possible swing trade.

AUY, Yamana Gold Inc., showed up on my stock screen today because it has broken out of a bull flag stock chart pattern.

AUY is a gold stock, and gold futures commodities prices on the NYMEX have been skyrocketing, so keep AUY on your stock watchlists.

SNDK, SanDisk Corp., broke down at a key support a few days ago. Consequently, support became resistance.

Today, SNDK made a retest of this resistance, but was soldoff and shorted. This is a bearish signal. The markets have been looking weak lately, so keep an eye on this stock chart in the next few days.

CSCO, Cisco Systems Inc., formed a bearish double top pattern a few months ago, leading the stock into a bearish downtrend.

Today, CSCO broke down from this downtrend, which is a very bearish signal that hints at the possibility of an accelerated downtrend. Keep an eye on CSCO and how it behaves in the gap to determine sentiment on this stock. 

A few weeks ago, I was provided with the opportunity to review a stock trading book called "Entries & Exits: Visits to 16 Trading Rooms," by Dr. Alexander Elder.

The book is a must read for stock traders who are just starting out. In the book, the author profiles the stock trading systems of 16 different professional traders. Each of these traders has a different style of trading, and it is important for novice traders to understand that they must find a trading style that best suits their personality and risk management. Although I've already found a trading system that matches my risk profile, it was nice to read about other people's trading style because it gave me some new ideas and techniques on how to improve on my trading system. Novice traders who read the book will be able to pick out a trading system that they feel comfortable with, and start out from there.

This is how "Entries & Exits" is structured. First, the author introduces you to the trader with basic background info. Then, he provides you with two chart setups. Some of the traders do stocks while others do futures, but regardless, technical analysis works on any kind of chart. The trader then explains to the reader the buy/sell signals that s/he sees on the chart, and outlines the strategy on how to approach and manage the trade. These discussions are the best part of the book. They give you insight on the exact decision making processes of a professional trader. On the next page are the result of the trades. One trade is successful and the other trade is a loser. The book then discusses what went right and what went wrong.

I give the author credit for presenting losing trades. A lot of books out there focus only on successful trades. However, in reality, all successful traders must be aware that there WILL be losers out there, and that it is important to understand how to deal with losing trades.

Also, the quality of the book is outstanding. It is hardcover with great looking colorful charts. They definitely didn't cut any corners on this one. It is a great addition to a trader's library.