Very Bullish Intraday Reversal Sends Stocks Well Off Their Lows As Top Stocks Continue To Outperform The Market
October 17, 2007 | Leave a Comment
I am not sure if I will have time to post a long commentary tonight, since I am going on a dinner cruise. Therefore, I want to make sure that I let everyone know that I found today’s market action very bullish and very comforting to my portfolio holdings. The pullbacks in my port were on low volume the past couple of days and almost all of my pullbacks have been right to support. So the fact the market bounced here and bounced on very large volume on the Nasdaq can only be spun in the bullish direction.
However, the bears were on it saying that it was just a lame bounce back to resistance. The problem with that assumption is that many leading stocks like AAPL and RIMM are hitting or very near hitting all-time highs again and the Chinese momentum favorites like SNP PTR SHI ACH CHL LFC CHA and SHI, along with the solar stocks, are showing newfound momentum recently after a bit of consolidation. Seriously, by looking at these Chinese stocks starting to take off in a 90 degree angle it is becoming very obvious to me that the gig has to be up soon. By looking at the FXI on an arithmetic long term daily or weekly, you can clearly see the bubble is now in full effect. But calling for its top is only a game the completely ignorant amateurs do–sure are a lot of them around, all of a sudden, in this market.
I don’t like calling tops and I would much rather be involved in the bubble uptrend (which I am) but we have to definitely be prepared for a top. The way these charts look, there is no way in hell anyone should enter any of these Chinese momentum stocks with them so far extended from the 50 and 200 day moving averages. But if you are long, don’t you dare dump all of your holdings. As far as we know the FXI index could easily touch 300. If this was the Nasdaq of 2000, the FXI will hit 350 before it stops. So you must keep that in mind. Momentum can last a lot longer than you think.
Stocks Selloff For The Second Day In-A-Row With Volume Mixed; My Current Holdings Still Look Solid
October 17, 2007 | Leave a Comment
Stocks sold off across the board for the second day in a row today as, I would assume, traders did not want to be long ahead of the reports from IBM, YHOO, and INTC. However, as I look now, the Nassy futures are up 9 points, definitely in a bullish reaction by the retail crowd. The very low volume on the NYSE indicated that the big boys were not playing, once again, today. But that also placed a positive spin on this dull day as the NYSE did not suffer a distribution day. The Nasdaq, according to my charting software, had higher volume, giving it a distribution day. IBD, however, has today as a lower volume day for the Nassy, giving it no distribution day. Either way, seriously, I don’t think it matters. This is just a normal consolidation after a very large move off the August lows.
The holdings that were in my portfolio did not outperform the market by any means but the only complete sells were, once again, sub $10 stocks that were very small positions. The other great thing is that I can hang in with the dry-bulk shipping stocks as they put in some very large volume reversals after putting in a parabolic move (DRYS EXM). Since I have taken 55% and 30% of profits respectively already, there is a lot of wiggle room I can give the rest of my holdings to make sure I do not miss on a possible very 2000 like bubble move. It is extremely possible since these shippers ship stuff all over the world. The growth in China and India has a major impact on these stocks. So DRYS going to $200 can’t be considered out of the possibility. $1000, yeah, is way insane; but $200 is very possible. Same with EXM, that could easily zoom to $150. Just look at YTEC. That is more of a China play but the shippers are still possible of similar, yet smaller, crazy moves like this. Somehow, I always pick the CBAK stocks when it comes to these speculative plays. Which is why I try to say away from gambling.
Stocks Slip On Higher Volume, Giving Stocks Another Distribution Day; Distro Day Feels Very Weak As Top Stocks Did Well On Monday
October 16, 2007 | Leave a Comment
It was another round of selling, after the attempted bounce on Friday. A lot of traders are asking if we are putting in a top and I have to be honest and tell them that I am not sure and do not care either way. It was bad that the markets fell 1% across the board but during the final hour stocks broke out above the intraday downtrend line signaling that there was some buyers willing to step up and buy the selling. Really weak markets tend to end with selling lasting till the close. The fact that the indexes flashed another “tail” on their daily charts shows that sellers are not in complete control and that bulls still rule this nest.
Right now, it still appears that stocks are selling off quite normally and I have to say that my personal portfolios are all holding up very well into this selling. In a truly bad market my stocks would be getting nailed if the market was that bad. The only top stock that clearly failed was NILE and the buy off NILE was coming from a very wide and loose bounce off the 50 day moving average. The pattern was much more crazy and volatile compared to the previous bases and uptrends, indicating to us that this might happen. So with that being the only real tragedy out there, I have to call today a success.
Stocks Recover Some Of Thursday’s Losses On Lower Volume; The Week Ends With Leading Stocks Enjoying Big Gains
October 14, 2007 | Leave a Comment
Friday was not the greatest rebound you could have asked for as volume was lower than the day before and the big cap indexes did not even close up 1% each. But the Nasdaq did rise 1.2%, closing near its HOD, and the IBD 100 almost regained all of its Thursday’s losses with a 1.9% gain. Coming off the losses yesterday, we do have to admit that the action today sure is a lot better than the market to have continued to selloff–like a TON of “smart” people were expecting it to.
The fact that the market did not selloff more was really not a surprise. Even though NONE of us knew that the market was going to rally today, it was a bullish note that few of our top stocks pulled back violently on large volume. Another obvious indication that the selling was not that bad was that the only complete cut losses I had to take were in very low priced stocks with poor fundamentals. There was nothing of quality that got hurt. However, knocking on wood did not help as BLL and NILE took it on the chin today giving us two possible top stocks that have now basically failed.
Technically, both BLL and NILE are still strong longs from the correct buy points. However, in this market, I find it wise to fully concentrate your money on leading stocks that are rising. Since there are so many top stocks making great gains, even though they lack perfectly beautiful green charts, it is wise to move money into stocks moving higher out of stocks that are moving nowhere to down after a long purchase.
Stocks Get Hit With A Real Distribution Day; Was It Really As Bad As It Seemed?
October 12, 2007 | Leave a Comment
I want to immediately get to the point of the last question. I simply do not see the selloff that we had yesterday as being that bad overall. After going over all of my current holdings and making sell decision a couple of things became quite obvious. One, the selling was very contained and most stocks that pulled back did so on average volume and did so after already putting in long sustained uptrends. Two, the stocks that did selloff hard that I had to sell due to breaking below key levels were all cheap speculative POS stocks. The only one that was not was BA and that one has been a laggard for quite some time.
Now, the stocks that did pullback, we have to realize, needed to pullback after the gains we have seen. It is not good that volume expanded as much as it did and that the reversal came in such a horrific and dramatic fashion but those kind of moves are very sharp and help raise the level of the fear in the market creating what should be good buying opportunities. However, something about this selloff lacked the fear that is normally associated with these kind of swoons.
Nasdaq Rises On Higher Volume And SP 500 Falls On Lower Volume, Just Like A Bullish Market Should
October 11, 2007 | Leave a Comment
It was a day of consolidating gains for the indexes but a late day rally helped send the Nasdaq well off the lows and actually sent it into positive territory with it closing near the HOD. That was the fifth straight day of that kind of action — nothing says bullish action like opening lower so often and closing near the HOD everydaySo, by the end of the day, in fact, it was only the big board indexes that actually found time to consolidate gains as the Nassy and the IBD 100 continue to lead the market higher almost everyday.
The SP 500 and NYSE also both came close to closing near their HOD but they sold off just a tad at the end to miss that from happening. But the fact that the index came so far off the lows creating some very bullish candlestick tail charts on the daily charts of the indexes says a lot about the pure strength of this market. There is no denying the bulls that this market has been beyond incredible.
Even some earnings misses from AA and BA were not enough to throw a damper into this rally. About the only thing I saw today that threw up a red flag was that the Investors Intelligence survey came out with 60% of the newsletter writers reporting that they are bulls compared to only 20% saying they were bears.
A Strong Rally That Started Around 2PM EST Sends Stocks To Another Impressive Close; This Market Continues To Reward Top Stocks!!
October 10, 2007 | Leave a Comment
There is not much else you can say about this market other than it is just an incredible beast. The way this market has been rewarding me, growth investors, CANSLIM investors, and momentum investors has been just as incredible as the constant gains in the face of a biased media. No matter what the bears say or do, it just doesn’t matter to a market that is in this strong of an uptrend with this many different leaders leading this market higher.
The people that have a hard time believing that this rally is going to last are probably suffering from the case of clear underperformance and disbelieve right now. They didn’t think the market could possibly bottom on 8/16, because of the Fed injecting liquidity in the market surrounded by all the subprime problems the media was CLEARLY over-blowing. So now most of these “smart” traders who were for sure the market was topping have seen a market rally hard in their face and now they face the sad fact that their investors are very upset at their lack of foresight to take advantage of these near-incredible gains.
I have heard some say the whole way that this rally would fail because new highs were not expanding to new lows. Well today there were 486 new 52-week highs to 65 new 52-week lows. So I am not sure how that number is holding now to the ones that were denying this rally due to poor internals. Helene Meisler is the one off-hand that I know has been pounding the table that this rally would fail (for the past five weeks) due to these poor numbers.
Nasdaq And IBD 100 Finish Higher But Big Board Indexes Finish Lower As Traders Take A Mini-Vacation On Columbus Day
October 9, 2007 | Leave a Comment
Stocks didn’t do much today as it was a Fed and banking holiday for Columbus Day. But for what did happen today it was bullish action overall as a market that was down across the board saw some lift near the end helping the Nassy close in the green and helping send the NYSE, SP 500, and DJIA off the lows. The lower volume was perfect as today was sort of a consolidation day with the big board indexes pulling back.
The action in individual stocks was very positive as there were no nasty surprises on this slow day in any of my personal holdings and many stocks are in the middle of forming some very tight bases due to the rather calm action we have had on the days where the market is not taking off.
The beauty in today’s pullback for the heavily invested bulls is that the put/call has jumped again to the .89 area and the NYSE short interest ratio hit another all-time high of 8.85. The bears simply can’t stop shorting a rising market. Which just completely confounds me how we have proof of what the greatest traders have done to make millions yet people will still try to bet against the trend ignoring over 120 years of price and volume history. Pathetic yet wonderful all at the same time as this assures me of a life-long income from investing in the stock market. The crowd is always wrong. When you are a kid it is cool to be in with the “in crowd.” When you are an adult, it pay to think the opposite of the mass public that blindly believes anything they hear and read on CNN or the NY Times.
Stocks End A Bullish Week On A Wildly Bullish Day For Equities; NYSE And SP 500 Hit All-Time Highs
October 7, 2007 | Leave a Comment
Strong Q3 earnings from the heavyweight RIMM and a very strong payroll jobs report helped gap stocks higher in a bullish morning for stocks. The best news was that after that strong gap higher, the bulls worked their magic short-squeezing the bears the rest of the day. There was a bit of a late day pullback but the pullback barely touched the Nasdaq at all but instead hit the less important DJIA (for us anyways). The pullback that barely hit the Nassy helped it close near the highs of the day up 1.7% hitting a seven year high. The SP 500 and NYSE hit all-time highs and the DJIA hit an intraday all-time high but pulled back, like I said, at the end.
What made today’s gains clearly better was the fact that volume jumped 15% on both indexes as stocks climbed higher almost all day and the fact that a couple of top indexes put in better performances than the overall market, clearly indicating that leading and top stocks are in control in this market. The IBD 100 jumped 2.3% and the DJ Transport avg. leaped 3.3% in what was a clear showing of leadership from top stocks. This has been the case since the start of the rally and continued with Friday’s market.
Bears Have A Tough Time Keeping Stocks Down As The Indexes Rally Late To Finish With Gains Across The Board
October 5, 2007 | Leave a Comment
Today was a pretty boring day overall. However, it still was a good day for leading stocks and my portfolio as nothing in my holdings or in these indexes took any beatings. That helps confirm that today’s slow trading was nothing more than a breather and if breathers end up with the markets closing higher and off their lows then we know we have a lot more gains yet to come.
A lot of traders after the drop in the DJIA in the morning were pretty confident that a new round of profit taking was about to begin but once again the bears managed nothing more than a little pathetic slap in the face. The strong closes continue to tell bears and perma-bears like Doug Kass(trated) that they are still on the wrong side and will continue to be as long as this uptrend last.
Today’s slow activity was booked by market commentators as a pause before the monthly jobs report that comes out tomorrow. That makes sense to me but I always find using these excuses as to why or why not institutions went to work to be nothing more than a big pile of bull crap. The fact is that the big boys are taking a break right now from bidding their favorite stocks up any higher. Stocks can’t go up every day, you know. And another funny thing is….hasn’t trading been slower almost every day since the lows in August, after the Fed stop injecting liquidity in the market? So do say the market was quiet because of the jobs report just is something the usual talking fools at CNN and CNBC have to tell us to make us believe that something exciting is going to happen tomorrow. How else are they going to keep viewers with the bullshit that constantly comes from these two networks.
