Stocks Close Higher On A Pickup In Volume; Volume Still WELL Below Average And Charts Are Still Very Sloppy

April 15, 2008 | Leave a Comment

It was another wild day on Maui as more drama occurred in my personal life today. However, it is minor and it has been taken care of so hopefully I can get back to doing what I am supposed to be doing instead of wasting my time on other things.

Anyways, luckily for me it was just more of the same junk that we have seen the past 17 sessions as volume is still well below average and the charts still look junky. What makes it worse, is that the few good charts we had building have gone away. Not all but still it is not good.

That is unless you are focused in one area and one area only. Oil. Oil hit $114 yesterday and closed at $113.79 which is a new all-time high. I have a feeling we are going to be saying that a lot. Especially when I look at oil stocks and see that they account for almost ALL of the stock market’s strength.

There were only 90 new 52-week highs yesterday to a very large 222 new lows but what stuck out to me is that out of the 90 new highs 58!! of them were in the energy sector. That is a whopping total, especially considering that the next most came from agriculture stocks as they had 6 new highs in the group. Obviously, the oil&gas and energy sectors are the only two places to be in this market, unless you are in soft commodities/ag. There simply is no where else to go.

Posted by Joshua Hayes | Filed Under Market Commentary

A Zig-Zag Day Ends With A Big Yawn As Late-Day Weakness Sends All Indexes Lower

April 15, 2008 | Leave a Comment

Well, in all honesty trying to draw conclusions from a day like today is quite useless. In fact, anyone that spent any amount of time today trying to delve into the data to find something useful just spent a whole day wasting time. Today was simply a low volume pullback and nothing-more and nothing-less. I believe, without even looking, that this was the dullest day of trading for 2008.

By the end nothing exciting happened except all the indexes were mildly lower. Too bad that was not the case for my biggest holdings. Shockingly, the past few days, the few charts that are starting to look “near-perfect” (meaning they still have time and the technicals still need work) are all acting the worst. On Friday my biggest holding was my worst holding prompting me to sell 25% and then today two of the five stocks that reside in my IRA now need to be cut. This is simply something I have never! experienced in twelve years. You can clearly see, by going over my ‘past big winners’ on the .com site that from 2000 to the 2002 lows I still about ten stocks make significant gains from beautiful chart patterns. Those same exact patterns are NO WHERE to be found right now and when they do start to form they seem to be targeted immediately.

This has prompted one emailer to wonder if the style has been “figured” out. LOL. To that I say it is simply IMPOSSIBLE. Do you know how many stocks are out there? Do you know how many different ways and reasons people have to trade? Do you know how many people REFUSE to buy stocks breaking out to new highs? Do you know how many people do not know how to buy new highs correctly (ie, they buy too late or too extended or after a heavy volume pullback)? Do you know how many people do NOT use telecharts thus making BOP completely irrelevant? Do you know how many people can not tell you what a cup with handle is that LIVE on the trading floor (I know, I once went around taking a quiz and I also asked could it come from a downtrend and uptrend. So many said no the first question and if they did say yes they then said it did not matter where it formed)? The fact is that this system is out of style, FOR NOW, but it will not be long before it comes back.

Posted by Joshua Hayes | Filed Under Market Commentary

A Market That Moves On No Volume Should Be Treated With Caution

April 12, 2008 | Leave a Comment

There is an old adage that goes “never short a dull market.” I couldn’t agree with that more and want to stress that it does not say “go all-in and long a dull market.” No, it says, “never short a dull market.” If we have to get down to the core of what that statement says it is clearly telling us that when volume is no where to be found the LAST thing you want to do is go short stocks as you are leaving yourself open to a large short-squeeze as usually happens in low volume markets. But do not think that due it saying that it is never smart to be short a dull markets that it means it is OK to load up on longs and be very long a dull market. It means to, more-or-less, MAKE SURE YOU ARE NOT SHORT but do not worry about being long either. To sum it up it is simply saying “when there is no volume you should have all cash.”

For those that do not understand why this is, it is not that hard to figure out. When stocks are moving up and down with no volume they become easy to manipulate by a few and when those few are manipulating stocks can move them and make them do whatever they want. I was just reminded that watching my favorite long pullback viciously on Friday. Volume was not that much above average yet the stock lost 9%. The stock is still above three supports, has green BOP still, and the reason for the trade still exist. So I will not be scared out of this long fully. But so many will be that it just goes to show how dangerous it is to be long in this low volume market.

Posted by Joshua Hayes | Filed Under Market Commentary

Just A Simple Reminder About What I Do, While I Am Violently Ill

April 8, 2008 | Leave a Comment

It is a deader than dead market today and so far looks to be lowest volume of the year. So I guess I will use this time to let the newbies and unbelievers know that what I do for a living and how I find my biggest winners in the stock market is not based on my opinions or others opinions. It is based on facts and history. In fact, I am not sure how long IBD has been running this above their 20 rules for investment success but I just recently noticed it and wanted to post it here. Remember, when you go over all of my ‘past big winners’ and see the % returns in my commentary post at mauitrader.blogspot.com (2005-2007) and BWT (2007-now), that I am simply using history as my guide to the future based on nothing but factual research. I don’t like my opinions and I don’t like others opinions when it comes to the stock market. When it comes to sports or politics, FINE! But if you are not using some sort of methodology similar to CANSLIM, you are only preventing yourself from becoming a true professional. Remember:

These rules aren’t based on our personal opinion or those of Wall Street’s experts. IBD built detailed models of all the most successful stocks every year from 1880 to 2005. We analyzed their common characteristics, what factors existed before these very best companies had huge advances and how these factors changed when the stocks topped. So these rules represent how the market actually works. If you ignore them and rely instead on personal opinions, feelings or emotions, you are potentially arguing with how the market has functioned for over 120 years (IBD has 50 but OBVIOUSLY that is not right) and you will likely make more costly mistakes.

Posted by Joshua Hayes | Filed Under Market Commentary

Some Days Are Just Better Than Others; This Was Not One Of Them

April 7, 2008 | Leave a Comment

I will try to get back here and right an intelligenct report on today’s stock market action. But it can basically can be summed up as “we are biding our time.” We are still simply waiting to see which direction volume is going to come in. If it is for the bulls, we are going to have a great time as we have a lot of very pretty charts now setting up. However, all it takes is a couple of bad days, ie, FEED, to destroy a hot stock chart.

On Thursday, the chart of FEED was one of my favorites. By Friday night it became one of my most scary longs as I had that quick revelation that this “could” happen to every single leading stock we can find. Therefore, it is still all about cash. And speaking of cash, yours truly just spent a lot more last night.

Last night I became VIOLENTLY ill for the second time since September. So bad in fact that I was forced to go to the hospital again! This is really starting to go out of control and I feel like I am losing a grip on my physical body as it is now finally starting to do stuff without my notice/interest. While I am still surfing, I might as well live it up because I can not be taking 45 minute drives to the Hospital every time a severe illness (which is possibly a result of the beta serons).

Posted by Joshua Hayes | Filed Under Market Commentary

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.

Posted by Joshua Hayes | Filed Under Market Commentary

Market Quietly Consolidates Yesterday’s Gains

April 2, 2008 | Leave a Comment

There was nothing great or horrible about today. The only thing I can say is that the retards who told me to buy stocks at the open sure were wrong. I do not daytrade and anyone that was trading like this today has a lot of work to do to become a great trader/investor.

The pullback in the spoos (up on IBD) and small gains (on tcnet; on IBD and RM I show small losses) by the nyse and nassy were very solid overall as volume did dip. However, a lot of strong CANSLIM stocks that I went long yesterday went from looking great with strong gains to looking OK with good gains by the close. This is not how leading stocks act at the start of a brand new nine-month “time to get filthy rich” bull market. This is instead how bear market rallies develop. Could it turn into a bull market? Sure. But it is still going to have to prove itself by making strong gains on heavy to huge volume. Volume under the 50 day volume average is your clear tell that only amateurs are trading (you and me). The professional money has only come off the sidelines four times last month in the Nassy.

Until these guys start moving the market one way or the other, you would be FOOLISH to load up on anything long or short. Nothing has changed today from yesterday. I still have NO HOT CANSLIM or speculative long charts. I only have about 50 really good looking charts. And even the best looking ones are losing technical strength. So this is still not a market I have ANY interest in being heavily long. I remain around 70% cash with ONLY 5% short (how does this make me a perma-bear, Wendy/Sandy Wright?) with the rest of the port in longs.

Posted by Joshua Hayes | Filed Under Market Commentary

Huge Gains On Heavier Volume Looks Good To Amateurs; The Professionals Know That Volume Matters And We Had NO!!! Volume On Today’s Rally

April 1, 2008 | 1 Comment

This is just another bear market rally, for now, and I will be more than happy to play it as I was only 9% short coming into today and 70% cash. I guess that means I was more than short. But according to some MORONS like Sandy Wright (Wendy), you are just too stupid to not get that today is a bottom. We will see about that. I have six new longs and three longs I want to add to my positions tonight but NONE of them make me excited. NONE of them look like ANY of my ‘past big winners.’

I’ll let the schmucks like Sandy/Wendy (or whoever this crazy is) believe that this is “THE BOTTOM.” I will continue to wait for proof and then get long the next bull market leaders, while the IDIOTS buy their BSC, LEH, URS, and BYI speculative-junk!!!

Cramer constantly produces 50% losses and I have NEVER!!!! in 12 years EVER owned a stock down 50%. Anyone hear of SGP? The stock I was short for a 43% gain that he was long for a 55% loss?????????????? Did you hear about that smart Cramer going long that? Or how about AUY, NYX, IMA, C, or any other blowup he has recommended?

Posted by Joshua Hayes | Filed Under Market Commentary

Another Wild Intraday Session Ends With Not Much Happening By The EOD; Cash Is Still King In This Low Volume Market

March 31, 2008 | 23 Comments

It is hard to continuously say the same thing over and over but it is true. There is nothing to do in this market other than to keep your trades small and your cash high. Especially, if you are a perma-bull as we are now finishing the month down for the fifth time in-a-row. This is much different from anything we saw from 2003 to November 2007.

I know a few traders that for some ungodly reason were bullish after today’s close. This was because they said the Fed has a new way of making sure the market has bottomed. Once again, the same market call but this time from different players with a different excuse. No matter how many people try this argument with me and no matter for what reason it is, I simply will not believe it until it is true. When I see the market making strong gains on strong volume with top stocks breaking out and moving higher (heck there doesn’t even have to be heavy volume on the indexes; I just need some HOT freaking charts, for God’s sake), then I will wrap my arms around this market just like the perma-bulls have been the entire way down.

The right thing to keep on doing is raising cash with stocks that we are cutting our losses on or taking profits on and to keep the new buys or shorts small until a trend is clear. Right now, the market has no clear trend as a low volume trading environment has now entered the stock market which could help build some nice bases. However, nothing is hinting at that what-so-ever as few NEW and FRESH stocks are forming bases after a previous uptrend in innovative companies with great fundamentals.

Posted by Joshua Hayes | Filed Under Market Commentary

Stocks Reverse Hard Selling Off All Session Into The Close, Closing Near The LOD; Lower Volume Eases Selling Pressure But Some Leaders Selloff On Higher Volume

March 29, 2008 | 2 Comments

The morning got off to a good start as the indexes gapped higher and started off strong right out of the gate, with the Nasdaq leading the way higher with a 1% gain. After that, sadly for the bulls, it was nothing but a slightly choppy ride lower with the market selling off the entire way lower with the 1% gain in the Nassy turning into a .9% loss by the EOD. The DJIA closed near the session lows for the second straight session. This was not a bullish session, to say the least.

Despite the losses, there was one bit of good news that can be taken away from this session and that is that volume was lower across the board. In fact, Friday’s volume was the lowest turnover of 2008 and shows that institutional investors who make up over 75% of the volume in the stock market were not active at all. Still, you can’t get too excited about low volume pullbacks when they come after low volume rallies.

We did have one heavy volume rally on 3/20 when the DJIA had its follow-through day. However, since then we have been left with nothing but low volume volatile-intraday sessions that have left us at the same point we were at right before the two bullish days on 1/22 and 1/23. This is not good as it is not normal to see a market have a FTD and then not put out any big winners that are working right away or have any follow-through days to the follow-through day.

Posted by Joshua Hayes | Filed Under Market Commentary

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