PREMIUM ANALYSIS FOR NON-SUBSCRIBERS FROM BIGWAVETRADING.COM
June 21, 2008
Along with what everyone reads here every night/morning, I also post premium analysis and my longs/shorts/sells on my .com site for a fee. Most subscribers I have talked to recently have been extremely happy the past week, despite the market throwing investors for a major loop.
One email I recently received I think sums it up best and if I don’t promote myself I don’t know who will. The truth is that this market might get real ugly and some of you that only read the free analysis might be in for some major pain. After that pain is inflicted you might then miss the next great bull market that will FOR SURE make every subscriber to this site rich. If you do not believe me I would like for you to study my ‘PAST BIG WINNERS’ from 1999 and 2003. There is more than enough to go around for everyone.
Anyways, here is a recent email I received TODAY:
apwr +18.97%
ipi +23.1%
titn +21.5%
about 6k in profits. like i said when that fro divvy posts, i’m going gold. i know this isn’t an every day occurance but the market has been crap for a month and i’m way up. you have made me more money in two weeks than cramer, fast money, bulltrade, gorillatrade, zacks, valueline, vectorvest, smart money and some i don’t even remember the names of in 18 months. what’s not to like?
–Robert H.
I think that says it all right there. At BWT you can be sure no matter what the market is doing, we are either making money or NOT LOSING MONEY. I will admit I am running an account (family) that is -1% YTD. That is horrible. But I have to remind myself the Nasdaq and NYSE are down 9.5%. So while it is embarrassing, and even though it very well could be my worst six month performance with a portfolio, it is still very good compared to the market. My accounts are up 16% YTD so all is well on my front. Still I am never fully happy with a down portfolio (my family) but with mine up and all my subscribers making money while banks tank, I have to admit I am very OK with this market even though it continues to take away my gains left and right. I KNOW it will eventually turn into a trending market once again. Patience is the most important trait you can have in the stock market. Patience IS the holy grail.
When I started to post my shorts and analysis for the shorts tonight I did not think I was going to pen such a long piece as they are normally only 1-3 paragraphs long but I felt like I needed to give everyone a bit more coverage on the market and the stocks that I have been taking for longs/shorts recently. This is a very unique market and I would like everyone to know that historically it is ALWAYS harder to make money in these kind of markets (unless you are a daytrader that swings support and resistance) when you are a growth/momentum investor. These kind of markets are best for cash and some dinky trades here and there. Every once in a while we come across some of these in a choppy environment (my current top performing stocks and their returns since my purchase [by using common sense you can find on a chart where and when I bought these by doing simple math]): PDO 236% QTWW 80% CPE 48% TGC 35% HIL 74% NCOC 36% XCO 37% CPST 99% LSR 46% ROYL 67% CMP 100% FSYS 28% XIDE 64% MCF 207% MTL 59% EBIX 178% CSIQ 84% MA 488% CXO 59% CLR 63% GEOI 112%. But most of the time you are going to run into stocks like LNN and VISN that constantly throw false bounce/breakout signals left and right.
Here is what I penned on the premium SILVER SHORTS section on the BWT.com website:
Just because there are 10 shorts tonight does not mean that it is time to sell all of your longs and get 100% short. Especially when I only have 4 full sells out of my current portfolio of longs. If it was time to get 100% short, I would have had anywhere from 10 to 20 full sells. No, I know when it is time to short heavily, with the most recent time being November to January, and I know when it is time to not short heavily even though the indexes, like the NYSE, DJIA, and SP 500, seem to be in a downtrend.
The market we are in right now is not a bull market or a bear market. It is a choppy, random, sideways market. That is why the VIX is at 22.97 (which is very low and thus bearish for equities as investors are complacent) yet the put/call is at 1.25 which indicates fear by the “dumb money” on the CBOE options exchange. So which is in the market? Fear or euphoria? That is not clear right now and since the market is in so many mixed directions with the crowd being very polarized I tend to err on the side of caution and recommend that investors raise cash.
Eventually, this sideways market, will give way to either a new downtrend (WHICH IT DOES APPEAR IS ABOUT TO HAPPEN) or an uptrend soon enough. But as we stand right now, the trend is VERY MIXED with some indexes in some uptrends on some time frames and downtrends on other time frames. A mixed market is a dangerous market and is the ONLY market that I (AND EVERY OTHER PROFESSIONAL SPECULATOR) can not make money in. Since that is the case, it seems to me the smart people would do two things here.
They will either raise cash and enjoy watching the madness on the sidelines realizing it is smarter and more prudent to save money here than fight a low odds and losing battle with the market. By doing this you guarantee you have more capital when it comes time for the market to either move lower or give us our magical moments and rally higher. These rallies of 40-70% on the indexes that happen in most bull market rallies is where we will make the 100%-500% annual return THAT IS VERY MUCH POSSIBLE!!!!! in strong bull markets. In bubble markets (ask Dan Zanger) the best will make 500-1000%. Too bad you only get one bubble a lifetime. I think mine has come and gone.
The second option, for those of us who still believe that our skill is good enough to game this market, is to keep all our trades small until the trend becomes clear again. That is what I will be doing. I will not be putting more than $1,000 in any short or long until the trend clears up.
Most of you know that my accounts run well into the six figures (I am only 29 and I have lived in either NYC or Maui since I was 18–so give me a break if I am not a millionaire; I also traveled and “partied” a LOT before the age of 26). With this knowledge you can now understand, in a relative sense, how much you should be investing in your short positions.
So if you have a $100,000 account, I would not buy more than $500-$1,000 of any position right now. If any of you think that commission cost will add up, you must still be living in a cave. FOLKS IF YOU ARE PAYING MORE THAN $4.95 PER TRADE, YOU ARE BEING RIPPED OFF. CLOSE YOUR ACCOUNTS AND MOVE THEM TO A REALTIME BROKER THAT OFFERS TRADES ANYWHERE FROM $1 PER TRADE TO $4.95 PER TRADE. THE ONLY BROKERAGE FIRM OVER $5 THAT IS OK WITH ME IS SCOTTRADE WITH $7 FLAT COMMISSION WITH $0 MAINTENANCE ANNUAL IRA FEE.
Remember, keep these small and keep that limit tight. If the stock gaps too far away from the Friday closing price I will cancel my order and will not take the short. They must be within 5% of the Friday closing price on a volatile issue or 3% on a non-volatile issue.
new short positions: xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx
new long positions: xxx xxx xxx xxx
adding to existing long position: xxx
I will be back tomorrow with a detailed stock market analysis for the upcoming week ahead.
ALOHA!
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Comments
3 Comments »
I have full time job i.e. cannot watch the market every minute. I need service just tell me what and when to buy; and when to sell. Also I do not have much capital and can not buy all picks. Please adv what membership are suitable for me?
Ying…
Thanks for stopping buy…we don’t offer this type of service…although Josh posts his buys/sells on Gold we don’t hand hold you have to do some leg work on your end.
We try to make the average trader a professional!
Aloha!
hey josh, thanks for this post,just wanted to let you know that me and the other people who havent yet joined your site really appreciate the knowledge your giving us with this blog. Im currently reading “how to make money in stocks” and that along with your site is helping me a great deal in learning how to become a trader. I was planning to start investing with some of my own money next month to gain some practical experience but for now i think i will just wait till the market improves…will be following your blog till the next bull market comes, also will be joining your site very soon if all goes to plan. keep up the great work,
god bless,
karan