What A Difference One Week Makes; Leading Stocks Signal That There May Be More Work To Do Before A Real Strong Rally Can Ever Take Hold
May 24, 2008 | 4 Comments
There is no doubt that I am suffering my WORST Multiple Sclerosis attack to date. Since Saturday I have basically been bed ridden and RIGHT OFF THE BAT I want to apologies if any of this is a little hard to follow because I feel like trash. I am not sure if this will effect what I am about to write but do me a favor and do NOT bust my balls if I misplace a word or misspell a word. My life is too short to deal with this.
I had a completely different approach in mind when I first wanted to write this but I figure I will stick with the facts. The facts are as quickly as this market looked like good times could be returning it in fact was possibly throwing us false “all clear” signal. Now while I never fully bought into this rally due to the volume, I still held hope that the rotation that I started to see into technology stocks would continue. Now I am beginning to wonder if that is what is happening or if they are making it appear that this was the case just to shut the door in our face.
At the end of last week things were looking very strong for the stock market, despite the low volume, as a lot of stocks that were in our portfolios were producing some large gains. But without ANY warning or clear reversal signal, the stocks started pulling back slowly getting rid of all the gains. The lucky part is that we did sell SOME as they pulled back since volume was higher. But the stocks pulling back on low volume and green BOP gave us no reason to sell. Since stocks that move up 20% in two weeks should always be held for at least eight-weeks it seemed stupid to sell anything pulling back. However, now it appears we should have taken more gains. This is the one time not taking profits quickly hurt us. The low volume was the tell and I should understand that next time as this is nto the first time I have witnessed this action.
A very Boring Session Ends With The Market Higher But On Lower Volume
May 23, 2008 | 3 Comments
Today’s market really did not have anything meaningful within it to focus on today. But what can be said about today’s rally is that it came on lower volume which is not what you like to see after a distribution day. However, it is good news that out of all of my longs, even though I had plenty where profits need to be taken, there was not a single one that needed to be completely cut for breaking the original thesis of the trade.
Without anything happening today that changes anything in the markets, I think it would be a waste of my time and yours if I put a bunch of junk up here that was just words to fill up a page. Kind of like most of the stock market commentary I read out there. There sure are a lot of long-winded people like me out there. Anyways, if you are at least a silver subscriber you have plenty to read on the new silver longs/shorts sections as I have typed out a few important notes over there.
For those that will still be here on Friday (a lot of our chat members have already checked out), I hope you enjoy trying to stay awake. Because that will more than likely be the call of duty for us tomorrow. I would not be surprised if volume is near the lowest or actually is the lowest day of the year and if we can move more than .5% up or down I will be floored.
Nasty Day Ends With All Indexes Suffering A Distribution Day; Day Six For DJIA And SP 500 Officially Puts The Rally Under Pressure
May 22, 2008 | Leave a Comment
For those that do not know what that means, it means that it is time to raise cash by selling down some of our longs. We recently have gone long quite a few stocks that have performed very well. Some of you made the right decision and took a lot of profits when some were up 20% to 50%. That was very smart. I did take some profits but with my larger holdings I was trying to hold for some powerful gains, thinking that volume still might enter the market to the upside as funds went back to work so they would not show underperformance.
Instead it looks like they are starting to return as sellers and with all the indexes reversing or failing right at the 200 day moving average it appears that the 50 and 200 DMA’s will be resistance for the market that the funds will use to sell into. I pray that I am wrong and that tomorrow we are up a lot so that we can resume the uptrend with our longs. However, I am not wishy-washy and know when it is time to pair back my positions. After today, it is time.
Some might be upset that you are not selling at the top and getting the gains you thought you were going to get. But trust me, one day, WHEN VOLUME IS HUGE ON THE indexes, these same stocks WITH EVEN BETTER AND MORE GREEN TO MAX BOP GREEN CHARTS will show up and run and produce 300% to 2000% gains. Sadly, too many of you will be used to selling too much off when the stock is up 10%, 25%, and 50% that you will miss out on most of the gains. For some of you, that are EXTREMELY new, that is OK. But for those of you who have seen this game before, you know that selling too soon is not the smart thing to do.
Was It Really That Bad? Nassy Falls On Lower Volume And NYSE Volume Rises But Remains Below Average; How About MXC, CKX, FPP, PDO, ROYL, and CLR!!
May 20, 2008 | 2 Comments
It sure was not a bullish day but at the same token it does seem people are treating today as the beginning of the end and in my investment life I have learned that when everyone thinks that something is going to happen the opposite usually happens.
on that note, today’s selling sure did bring out a lot of people that are worried about further selling. To that, all I have to say is if you have some profits and do feel afraid you will lose some. Why don’t you sell 20%, lock in some gains, sit back and relax, and then let the stock TELL YOU what to do next. For now, I don’t see a reason for all the worrying that I saw today. How I judge how bad selling is is to see what it does to my current holdings and to see what the short scans bring up.
When it comes to the 70 plus stocks I am long (14 are of good size the rest are nothing that will change the fate of my world) there were ABSOLUTELY ZERO that gave me a FULL sell signal. Everything that pulled back did so either on low volume, barely pulled back on higher volume and had a bullish reversal before the close, and/or if it did pullback heavy it did not close below either significant support or the 50 DMA. Now I hate to be a party pooper for the HUGE short interest that is out there but facts remain that when a market is ready to top I will not only have a few partial sells I WILL HAVE A FEW FULL SELLS. Tonight, I had NO full sells.
Lower Volume Selloff Hits Stocks As NYSE Volume Is Still Below Average; DRYS, EXM, and DSX All Put In Nasty Intraday Reversals Near Old Highs
May 19, 2008 | 1 Comment
I am not going to write a long commentary tonight as I really don’t see anything too important out there that I need to spend too much time focusing on. The biggest event was the late day selloff in the stock market. However, some are forgetting that the DJIA and SP 500 still closed higher and that volume was lower on both exchanges, with volume being below the 50 day volume average on the NYSE for the 41st straight day in-a-row.
Also, don’t forget the NYSE short-interest has hit ANOTHER all-time high at 13.66 meaning that it would take 14 days to cover all the shorts on the NYSE right now, on average volume. Even without volume, the market has an upward bias and I do not want to short a low-volume market especially when the short-interest are at astronomical levels in so many stocks. That is how you end up with MXC and PDO.
At the same end that I don’t want to be short or not long this strong market, I suggest that those that CONTINUE to buy stocks the day before earnings STOP. I always take my signals on my charts, almost NO MATTER WHAT. This takes all emotions out. But when I saw that PWRD had earnings my total buy that I had planned for Monday morning was chopped by 90%. Those that were in the chat room KNEW I did this. However, those here couldn’t have but I made it clear that this stock was not safe to go long for newbies. Thankfully, I did not see any horror stories about PWRD. But I am still disappointed as I thought I had myself a possible monster stock. But since it has failed, the last thing you will see me do is justify a WRONG position and hold on to it “hoping” that it comes back. Nope, that stock, along with GA, must be taken out. BOTH of those stocks show why buying a move the day of the earnings is a bad idea. Both charts setup up a buy signal the day before earnings and had I FOLLOWED MY OWN RULES I would have a little bit more money in my pockets.
Looking For Leaders In This Market
May 19, 2008 | 5 Comments
One thing that I do not hear a lot about but that is very clear to me is that stocks that are leading ARE REALLY leading. That can be seen especially when it comes to the amount of stocks that are hitting new 52-week highs. About a couple months ago things started to slowly change when new 52-week lows stopped expanding at the pace they were.
After the March lows and a small market rally, the new high list started to slowly build. And now we are at a point where even on down days, the past two weeks, the amount of new highs either match, are breakeven, or barely losing to new lows.
On Friday there were 244 new 52-week highs to 95 new 52-week lows. This was the best reading I have seen yet, since God knows when. I know in the August to October there were a lot of stocks hitting new highs but I am not sure it looked THIS GOOD then.
The leadership is clearly focused in one area too. The energy stocks had 96 of the 224 stocks hitting new highs come from their list. These stocks that you should be watching for future bounces off the 50 DMA or breakout are PDO, FPP, ATN, PHII, RAME, HUSA, RDC, APWR, TELOZ, WLL, ESV, APC, WMB, OXY, GMXR, COP, NE, CVX, GTE, SFY, CNQ, GU, HOS, BTU, NXY, ECA, BTE, HK, CAM, HES, PDE, FTI, UNT, WFT, MCF, STR, PXD, HP, CPX, PXP, SPN, PBR, HAL, MMR, E, SSL, SWN, WTI, WHQ, PBRA, SM, EAC, GLF, PVA, FST, TTES, CXG, and WES. All of these stocks have GREAT fundamentals and are all leaders based on price performance.
Bullish Week Ends With Leading Stocks And The SOX Taking The Lead; The IBD 100 Finishes Up 4.2% And The SOX Finishes Up 5.8% This Week, Clearly Showing Us Where The New Leadership Is
May 17, 2008 | 1 Comment
There is really only one word to describe Friday’s intraday action: bullish. Right off the bat, thanks to a report showing the University of Michigan consumer confidence number fell below 60 to a 28-year low, the Nasdaq fell 1.2% within the first two hours. This selling was pretty nasty but still the report should not have shocked the informed investors who saw the IBD/TIPP poll hit an all-time low last month. I am sure we can expect more of the same come Tuesday when the new data is released. Thankfully, for the bulls, cooler heads prevailed and quickly the consumer confidence news was taken as old news and shaken off.
By the end of the day, it was an impressive turnaround on all the indexes, as everything closed near their HOD. The leading index was the NYSE which scored a .5% gain. The SP 500 also was up today, gaining .1%. On the other end, the Nassy lost .2% and the DJIA lost .1% but both still closed near their HOD. Considering the losses that all the indexes had going after the first two hours there is no other way to call today anything but a victory for the bulls.
Another Bullish Day Equals Another Great Day For Our Longs
May 14, 2008 | 1 Comment
Today was yet another day where the market did not do much but our longs crushed it. This time it was our recent solar stock purchases. This continues a very bullish pattern of where everything I buy continues to move higher. Once again, tonight there are four new longs and zero full sells. This has been a recurring theme and is a theme of any bullish market. Higher volume or not.
Even though we still have zero institutional support on the indexes, it is clear that in this stock picking market there are a lot of stocks they are accumulating. The majority are in the energy industries, obviously. It might not be easy to buy stocks correct but it sure has not been difficult knowing where to put a lot of money. The gains in two solar stocks today that I am heavily long is more proof that as long as you know how to pick the best stocks, you can destroy the stock market. Remember, all those people from weakmoney.com that were telling me to go long stocks like GS, LEH, MS. I don’t know about you but I told you then that you did NOT have to buy the exact low to make a CRAPLOAD of money in the stock market. My recent longs are proving that.
For those that still think that you have to buy the exact low, this should now prove to you that those talking heads on CNBC are just that. Talking heads.
Another Perfect Day For Our Longs, Especially Our “PERFECT” Long; Never Short A Dull Market
May 12, 2008 | Leave a Comment
So far things are looking good and unless we close at the LOD and wipe out all of the gains I will be very happy. My charts continue to look well as some of my largest positions (9 of them) are up HUGE today making today a great day after two days in the country/jungle. what a great way to start the week. The only thing I will be watching closely is the close and volume. I want volume higher by the EOD and I want us to close strong or if not strong to make it a perfect day, at least not at the LOD.
Also another lesson of NEVER chasing is today in GENC. I have been taking profits on the way up and if you have been following all my sells in the forums you will see that I was already out of 40% of it before today’s decline. Even after the swoon today, we still have a gain in it. Also, do not sell it intraday. The chances are much higher with it being down this much that it will have a strong rally before the EOD. Even if it doesn’t, it doesn’t matter, the stock is a full sell and we still walk away with a profit on the full 100% with me already being out of nearly-half when the stock was between a30% and 60% gain.
Our leaders are doing well and remember if you own a stock up 20% or more in less than two weeks (which we have had a few quick monsters), you need to hold them at LEAST eight weeks.
How Much Longer Will The Good Time (The Rally Has Not Been Long Enough, To Be “Times”) Last?
May 9, 2008 | 1 Comment
I am not for sure about that answer but I have to admit the charts overall still look like they are trying to make a bottom. But like I have continuously warned about: if volume does not come back into this market on the upside, we are in danger of reversing some decent base building and that will probably discourage a lot of market participants which could open the door to more selling.
However, there is nothing wrong with being prepared, but until the market actually cracks, I will have to go with the short-term to intermediate term uptrend and ride the wave for however long it wants to last. The sad thing is that the way some of my stocks that looked great just a couple of weeks ago now look only average to somewhat above average. This is OK but in a brand new bull market, we would normally have 5-6 near-perfect to perfect charts right now. Instead I have one. One chart STILL looks “hot” out of about 4 or 5 that were starting to. Basically this has been the theme ever since April 2006 but thank God some gems here and there have still been able to shine through the rough.
It has been a long time since a WHOLE BUNCH of stocks setup in proper to perfect bases and then broke out and ran away. The truth is, I am only finding a few gems here and there and usually when I find a gem it fails. However, for every 3 or 4 that fail and that we can cut quickly thus saving ourselves a LOT of pain, we will always have one that can run. They might not be of high quality like AFSI but as long as 1 or 2 are around I guess that is good enough. But the further we go along without these near-perfect to perfect charts setting up or even holding on the more problems we will run into in the future.
