Nasdaq Leads Impressive Day Of Gains On Slightly Higher Volume That Is STILL Well Below Average; NYSE Slowest Day Since December 27, 2007

May 13, 2008

I don’t know what I can say about this market that has not already been said. I find it very difficult to BS about the market when there is nothing to BS about. But I will give it a shot.

I do not like seeing the IBD 100 lag the Nassy on a day of such strong gains. The other thing I do not like seeing is the impressive gains on much lower volume with the NYSE having its lowest day of volume this year. This is a clear sign the big boys have no interest in buying this market. However, as you can tell via my recent longs, there are a few stocks they are still interested in buying. That is why this is still a stock pickers market and thank GOD I can pick them!

Until volume returns to this market, there is no way I am going to let go of 25-33% of my cash. I am going to continue to keep that on the sidelines while I wait for another perfect long setup like the stock that had a good day today. If another chart can show up like that, I would be more than happy to drop that cash position. But still with the low volume, it is hard to get 400% invested on margin.

I suggest to continue to buy the best CANSLIM quality longs with the best chart setups. We have not been without them, thank goodness, as about 70 stocks are moving steadily higher racking up some nice gains including a stock that I will be almost fully selling tonight. GEOI is now up 122% in under three months and in this market that is a HOME RUN. Now, if only the 10 longs I am loaded up on can act just like that, this year will be a great year. But I am not sure if that is possible with the market continuing to move up the way it is on no volume.

I am starting to lose my bullish luster because I see the put/call falling to .77 today which is matching the lows of 2008. I am sure another big up day will throw this number under .77 making traders the least bearish they have been in 2008. Confirming that is the VIX which hit a new 2008 low of 17.79 while hitting 16.92 intraday. If that is not complacency on this rally, I do not know what is. That VIX and put/call is going to have to rise a lot while the market barely pulls back for me to fall in love with stocks like I almost did a couple of weeks ago when some fine-fine-fine charts were STARTING to show up. Since then they have ALL faded, but ONE.

So with that we are back to the usual waiting for volume to return. As subscribers know already, I am battling a MASSIVE and PAINFUL headache tonight due possibly to dehydration. I have still managed to update the shorts and longs analysis by about a 90% completion level as I am only able to go IN-DEPTH on the reason of buying if I am not busy. So basically, I got everything done. There might not be any new ‘Past Big Winners’ the next couple of days as I attempt to catch up on everything I will fall behind on tonight in the forums and tomorrow overall as I go have an endoscopy procedure at 1pm HST. So we will see how drugged up I am after that.

Aloha for Monday and I will see you all in the chat room at 630am HST (1230pm EST)!!!!

Posted by Joshua Hayes | Filed Under Market Commentary