Low Volume Consolidation After The Big April Fools Rally Is So-Far So-Good; CANSLIM Stocks Setup And Breakout But Volume Is Still Suspect
April 5, 2008 | 1 Comment
A weak open after a very poor employment report that showed the US lost 80,000 jobs in March with the unemployment rate moving up to 5.1%. It was a pretty lousy number but considering the fact that we had 25% unemployment after the crash of 1929 it isn’t “that” horrible. But the media, with a Republican still in White House, of course, made it sound like all hell was breaking was loose.
Maybe that is why the market could not build on the weakness and instead rallied higher the rest of the day off the lows until 2pm when traders unwound some of their longs into the weekend. Overall though, it was very positive action, following a strong rally on April Fool’s Day. That now makes it three constructive sessions in-a-row where stocks have held on to the gains.
Volume, however, was, once again, nowhere to be found as it came in lower for the third straight day on both exchanges. I would be A LOT more happy about the low volume consolidation if the indexes were pulling back. But they are slightly rallying on this low volume and while not bearish, by far, I still would much rather see higher volume gains and lower volume pullbacks. It is good to see that two of the three days on the DJIA have been lower. But overall they are slightly rising on lower and lower volume. Overall not a good LONG-TERM development. BUT! it is a very good short-term development as this is the first rally attempt that has not been thrown back immediately.
Bottom Callers Come Out Again And This Time They May Finally Be Right After Being Wrong The Other NINE!!! Times; CANSLIM Stocks Are Showing Up Now
April 1, 2008 | Leave a Comment
I have some great new longs tonight. And some of my current longs made some impressive gains today along with a couple of my favorites setting up new buy points.
Nobody in their right FREAKING mind knows if this is the bottom or not and to be honest volume is NOT being confirmed on the indexes but I do have some nice charts and if they build on this those charts will become great charts and I can then go back to KILLING the performance of the bottom callers. For now, they may be have gotten this bottom right. Too bad they will be going long the wrong stocks, while I will be going long our new leaders: G**, S***, M***, A***, S***, B**, S**, B**, and M**.
The charts in those stocks are not perfect but if this rally can start here and move higher to sideways for another month to three months, these charts will be beyond hot and while the idiot bottom callers are focused on their C, GS, BSC stocks, I will be getting my 300% returns again. Why not 500%?…………LOOK AT THE VIX!!! 22.638. 
Immediate Distribution Day On The NYSE And SP-500 Proves Bottom Callers Are Going To Be Wrong AGAIN; Now That They Have Hit The Current/New Leaders (Gold, Oil, and Chemicals) This Could Get Real Ugly
March 19, 2008 | 7 Comments
Wow is about all I have to say today after watching the market’s action. And the wow does not refer to the price reversal on the major market indexes. The wow has to deal with the action today in the top four leading industry groups in the IBD industry groups. They were simply rocked! Not only did they selloff hard, they did it on low volume. When the leaders are treated like this you can guarantee that there are some major problems stirring underneath.
Today quite a unique event happened today in the market that I have not seen the entire downtrend. And, imo, this is not good. The last time I saw this was in late 2000. That is when the bear market gained steamed and sent stocks much lower. Well, today, the chemical-fertilizer, metal ore-gold/silver, steel-producers, and oil&gas - US expl prod all fell between 5.9% and 6.9% which is just shocking. To see leading stocks in this really rough market get treated like this is the last thing from bullish as it can be. Only a politician could spin this as bullish.
5 out of the top 9 worst performers were in the top 10 industry groups. This is not how a market should act. Not only should the leaders be from more innovative areas of the economy, they shouldn’t be selling off when they are up there. If the weak stocks are getting CRUSHED (BSC TMA C etc..) and the strong stocks are getting crushed (GTU AUY BVN XEC EOG etc…) where is there to hide? The answer is no where. Only is cash or bonds the safe place to be. It is simply not a market any of the greatest traders today or of all-time would mess with.
DJIA Leads The Way As BSC Rocks The Stock Market On Mixed Volume; How Can This Be A Bottom Without A HUGE Surge In Volume On the Nasdaq And NYSE? It Can’t Be!
March 17, 2008 | 2 Comments
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Stocks gapped lower after a horrible announcement by JPM that they bought BSC for $2 a share. Now, while I don’t want to gloat on this, I just want to say that for the 100th time in my life I have warned a bunch of traders to not buy a certain stock and yet they still do it. There was one reader from Santa Barbara from RealMoney.com that attacked me 8 days ago for telling him BSC was a POS. Well here we are from $75 to $4 and yet still no apology. No, thank you. No, I am sorry. Just a big pile of nothing. From Eugj to BHCO to Gerard to WillPS to SCO to Geoffrey from Santa Barbara: all of these characters have called me out and told me that I did not know what they were doing and EVERY SINGLE TIME THEY WERE PROVEN WRONG AND EVERY SINGLE TIME I DIDN’T RECEIVE A SINGLE I AM SORRY OR THANK YOU. Is this what our world has come to?
Oh well, there is no doubt I have become a sensitive character in my old age and things like this bugs me now. I just don’t know how yet to act when it comes to responding to jackoffs that make themselves out to be major idiots. I guess I will learn to ignore it in the future. The exact same way I ignore going long any stock below the 50 day moving average or go short stocks above the 50 DMA.
BSC Blowup Proves A Chronic Emailer Wrong And, Once Again, Proves The Power Of CANSLIM; Stock Market Indexes Selloff On Mixed Volume But Hold Recent Lows
March 15, 2008 | Leave a Comment
Today was another day in the stock market that has just gone to prove that cash is in fact king. When you try to play a stock market with a heavy hand or even on margin in an environment like this you either have a serious illness or you just have never taken the time to study history and to have learned that the smartest thing to do is NOTHING. A stock market that is this volatile that has THIS MANY BLOWUP is definitely not a stock market you want to be messing with.
I am simply STUNNED! by the number of emails I have received from RM readers that tell me I don’t know what I am doing because I am not buying the bargain of BSC the past five days in a row. First off, the fact that ANYONE in their right mind is buying ANY stock below the 50 and 200 day moving average is pure INSANITY! These foolish investors think they are buying something that is giving them “a once in a lifetime opportunity.” Folks, that once in a lifetime opportunity only comes along once for these guys because they are ignorant of history.
If they have would have taken just a few moments out of their life to have studied the greatest winners of all-time they would have seen that the same patterns show up over-and-over-and-over. I simply do not know how many times you can see a cup with handle breakout from a fundamentally sound company in a bull market in every year, no matter if it is 1880 or 2008, and see those gains that they produce AFTER they are above those lines and say “no, you know, I am going to get this bargain here.”
Incredible Fed-Induced Rally Ends With Stock Indexes Closing At The HOD On Higher Volume; Remember, The Most Powerful Rallies Always Come In Bear Markets
March 12, 2008 | Leave a Comment
There is no other way to describe today as rally other than “incredible.” But even though we can say today’s rally was incredible, is anyone surprised, after telling you that the market was extremely oversold and we could get a bounce as the put/call is at 1.41 which is extremely high? You really can’t say you are, since I have hinted that this was coming.
However, to the magnitude that the rally hit us, I had NO clue that was going to happen! Obviously, if I would have thought that was coming I would have partially covered a lot of my shorts that had huge gains. Instead, I had to do that today. And the beauty of that was that very few gave back more than 3% on the day. Considering where the majority have been shorted, that is darn good.
Too bad, the big-cap tech stocks are the ones that are not cooperating (FSLR, RIMM, BIDU) and it seems to me that many newbies are taking pot shots at these shorts. First off, I have warned you over and over and over to NOT short stocks UNTIL you MASTER the long side. Anyone who is shorting stocks that has no history of having consistent winners in their portfolio is being dangerously foolish. I thought I have made this clear but obviously I have NOT! Second, I don’t know how freaking clear I have to make it that my shorts ARE SMALLER HERE THAN THEY EVER HAVE BEEN. I was shorting in bigger size early on but when all of my big-caps either failed or got away from me, I have scaled back. And as the crowd grew more hostile and I saw the market get more volatile (relative to the recent market), I began raising cash.
When A Market Acts Like This After Giving You A Few Nice Longs It Is Very Bearish; Stocks Selloff On Lighter Volume, Sending Some Indexes To New Closing 52-Week Lows
March 6, 2008 | 3 Comments
There is almost no other way to spin this day other than extremely bearish. From the morning to the close, the market sold off all day, with the only bit of consolation coming in the form of lower volume. However, the ferocity of the selling with absolutely no bounce, coming after quite a few recent nice charts have setup, is very bearish. If this market can selloff like that on lower volume, imagine what it is going to do once institutional investors get back to selling.
When I woke up this morning and saw the damage, my first reaction, was sort of a bit of bewilderment as we jut had two handfuls of charts setup in very nice patterns in leading sectors. So when I saw the selloff I was immediately disappointed that the few longs that setup can’t even get the market going a little bit. This disappointment, is obviously not from the market being down (you should ALL know that I am VERY bearish on this market, by now) but the fact that even when it appears that it can bounce, it can not. With that kind of action, it seems impossible to think that any “HOT” charts can setup. So throw NEU and CMP to the dogs. They can’t be perfect anymore. Nothing can be, right now. The charts, minus the metals, are in trouble.
Not only are stocks in trouble, but every piece of economic data that comes rolling in is literally rolling off the charts. Today it continued with word that the total amount of all mortgages that were in foreclosure was .83% which was a record high. Not only that, but the delinquency rate hit 5.8% which is the worst since 1985. Data like that, combined with the Fed telling us that American’s debt on their homes is higher than equity in the home for the first time since 1945. That happens to be when they started keeping records. It is quite possible that this is the lowest ever.
Stocks Show Why It Is Silly To Short The Market Before A Clear Downtrend Is In Place.
January 24, 2007 | Leave a Comment
A lot of good earnings helped the market shake off some recent selling as stocks rose across the board with leaders leading the way.
At the close, the Nasdaq led the way with a 1.4% gain as the index reclaimed its 50 dma, the SP 600 followed with a 1% gain, the SP 500 was up .85%, and the DJIA put in a very solid .7% gain. Leading stocks were the clear winners, with the IBD 100 up 1.6%. Big cap tech was the best on the day, however, as the Nasdaq 100 rallied 1.65%. Read more
