Tuesday, March 18, 2008

Monster Day.....!

What a rally we had today. The Fed did what he had to do as usual. At first it seemed this rally had no legs, but in the end the Bulls won the day. The Dow, S&P 500, and Russell 2000 seem to be coming out of a double bottom chart pattern. Usually this means that higher prices will be here very soon. Remember that this bear market still here and we are just bouncing off oversold readings. However if investors decide to buy more, then we could be seeing the start of a new bull market. Only up volume will tell the whole story.

Tonight I decided to highlight a previous winner with good earnings. CSIQ is coming out of a triangle and may start it's way higher if the market helps it. Volume is key since it has been dropping the past couple of days. Buy point is now if the market can hold to it's recent gains.

Tuesday, March 11, 2008

Short Term Bottom

Just like I have been talking about lately, the markets finally bounced off extremely oversold levels. What a bounce it was too. I'm hoping that the Fed's move is going to be perceived as more than just a bandaid to recent problems in the economy. If we can get good follow through very soon, almost any stock would be worth going long on. Fertilizer, solar and home builders are the groups to watch for this move.

Tonight I decided to highlight a technical play that could be worth a couple of points. CROX was a winner last year but stocks don't go up forever. After taking a beating the last couple of months, the stock has made a bottom and is very oversold. Today the stock had a nice turnaround on very good volume and has made a stochastic crossover. Buy point is now and could get up to $25 or so. Remember that the market was very oversold and may go up from here for some time to come.

Sunday, March 9, 2008

Almost There......

Not much to report right now. The markets are obviously in bear market mode so any longs are tough to enter. I do see the we are at oversold areas that soon will make the markets bounce strongly. I would start to look to exit any short positions very soon. After we get that first day of a turnaround, I will post some stocks to go long. Right now I think we should all wait for confirmation.

Thursday, March 6, 2008

Where Are The Markets Going?

It seems that there's no end to the selling. We just can't get enough bad news lately. Tuesday's rally was just another feeble attempt by the markets. "Where's the bottom?" traders keep asking. We are retesting recent lows and if the bad news don't stop, we could see a break from those lows. Bear markets are a necessary evil that's needed to establish a new trend and bull market. If you can't day trade or are not willing to keep an eye on your stocks, then cash would be best. One strategy that you could use is to wait for the markets to be at an extreme reading and then go with the trend. Right now the markets are somewhat oversold and could be getting ready to reverse the short term trend. What that means is that if you want to buy low and sell high, this could be the opportunity. However don't expect too much profit. Just a quick couple of points just until the markets get overbought once again. Next week we are bound to see a nice bounce up if not tomorrow. Remember to buy only the strongest stocks such as the ones that just posted great earnings.

Tuesday, March 4, 2008

Odd Markets..........

Not much to report today with the markets doing odd behavior once again. It doesn't matter if you were a bull or bear today, if you aren't day trading you can't stay long in this market. I personally would like to see 1 or 2 more days of selling to get this market into very oversold areas. If it can do this, then it would be ready for a big bounce. As of today the markets are a bit oversold. If we can get this selloff I feel it's coming, then almost any stock you follow will probably rally.

Monday, March 3, 2008

Tuesday's Oil Pick

Just as I suggested last Wednesday night, the markets sold off from overbought areas. Unfortunately it also means that my pick DRYS also had a bad failure. Once again more time is needed. This bear market behavior may take some time to work itself off and selling to exhaust itself. Bad news seem to find no end just as the word "recession" is being mentioned more and more. I for one don't think that recession or this market sell off is such a bad thing. It's a normal market cycle that will also end eventually. When it does, a new bull market will begin. Patience is also a skill most traders have to learn.

Tonight's pick is RIG. This company is in the oil sector and is one of the better movers. Now that oil prices are going through the roof, this could be a winner. The markets also have to do their part of course. Buy point is somewhere north of $145 on good volume. Remember that this stock's action is not only tied to the market but also to the price of oil.

Wednesday, February 27, 2008

Today's Lesson

I'm going to start by pointing out the failure in my last pick SOLF. Technical picks don't always work out since all you have to go with is an indicator and not much else. Today's unfortunate news of a downgrade by some analyst is always unpredictable. Sometimes analysts will downgrade a stock just so they can get it cheap for themselves or a client. I have seen this myself at least once before. When that happens usually the stock will recover soon after the downgrade. We will see in the coming days. Solar fun hasn't reported earnings yet so with this failure it may as well be an avoid until earnings have been posted.

Tonight's pick is DRYS. The whole dry bulk shipping group has posted very good earnings and DRYS is no exception. The stock is consolidating nicely and may break out of this box I highlighted. Buy point is above $88.60 or now if you have the guts. The markets are a bit overbought so keep that in consideration because we may be getting close to some kind of sell off.