Friday, January 23, 2009, we had four Around the Horn premium trades, two Extra Innings and two Stocks to Watch trades on our radar. Of these, two had profit opportunities, one was a small loss and the rest were no-shows.

United Health Group Inc (UNH) was a Line Drive long Around the Horn premium trade for Friday. This is one of those trades that makes the exception to our rules that keeps trading interesting. UNH opened and initially traded lower before reversing to our entry level a couple of hours into the session. UNH then traded up to the S1 pivot and our 50% to target level and began oscillating around this level in wide swings. The tail end of one of those swings came to within 10 cents of our initial profit target, signaling the move of our profit stop to the 50% to target level. Then this wide swing back down did take us out with a profit at that 50% to target level. Here is the rub: UNH did go on to hit the initial profit target level, topping out at that price before trading back to the 50% to target level. It’s the kind of thing that makes you want to change your rules until you look back at the reason you made the rule to begin with: trades that don’t tap the profit target but come within 10 cents then go back to zero profits. Sometimes you have to take the bad with the good for the overall health of your trading account and, hey, we still made money on this one.

United Health Group Inc, 5-Minute Chart


American Financial Group Inc (AFG) was a Fast Ball short Around the Horn premium trade for Friday. AFG gapped down on the open and initially traded lower before reversing and trading above our entry level then reversing again to trigger our entry short. AFG traded shy of the 50% to target level, keeping us in the trade all day for the slow, painful trade to within pennies of our stop loss. AFG then started the decline late in the session, closing us out just about half-way between our entry and our stop loss.

American Financial Group Inc, 5-Minute Chart


AVX Corp (AVX) was a Line Drive short Stocks to Watch trade for Friday. AVX had an entry opportunity in the morning session on a break above early resistance and Thursday’s closing range. Exit was signaled on the reversal of two closes after a sharp morning climb.

AVX Corp, 5-Minute Chart


Extra Innings and Opportunities for Monday, January 26, 2009:

Magellan Midstream Partners, 30-Minute Chart


DST Systems Inc, 30-Minute Chart


P.S. If you enjoy my column and would like to join our Intraday Trading Plan, try it for one week for $5.  Click here to start receiving our best trading setups for every trading day.

Julie Peterson-Manz is cofounder of TraderInsight.com. Email her at julie@traderinsight.