VIX Hits A 10 Year Low

Where did all the volatility go? I wonder if the VIX can break 10? Who cares, at 50 or 10 it is all good. Longs will either rise fast with volatile movements or they will go smoothly up-steady and strong. 1999 was fun and the money was quick and very rewarding. But slow markets are much nicer, if you ask me. The relaxing pace makes it easy to hold onto winners longer than I did back in those days. No matter what, having a cut loss and a method of taking profits is more important than "picking" or "selecting" great stocks to purchase long or short. Bottom line: I like the VIX at 10.33. That doesnt mean I think it is going to stay there much longer though. :)

Friday was a dull day for the markets, as volume contracted across the board. I am getting about the same amount of longs as short candidates in my scans so I am wondering if we are going to take a rest here. I really think we need to because some short term damage has been done to stock charts and for the pattern to look correct again a basing period needs to happen. If it goes straight back up the charts will havve a historically good chance of reversing their immediate upthrust this late in the bull cycle. These moves are called V-bottom moves. Gary B. Smith of Realmoney.com describes them really well in his commentary. Biotech, Insurance, Semis, Medical-Dentist, Genetics, Retail-Consumer Elec, Telecom Wireless Equipment, and Internet Content are the sectors seeing recent inflows as a sector rotation is occuring from the Oils, Metals, and HMO/Hospitals.

New Longs: MIDD CVD PTA NEOL ALXN ANDS WYE AOC AGO

Longs Making Strong Moves Today: HLTH BMRN CSU

New Shorts: ARLP HOTT HITK DGII RMBS SCHL BEZ IHP

Shorts Making Strong Moves Today: EMAG

I can not stress how important it is to short at the right moment very close to a previous resistance level, imediate break of support, or a moving average. This market is not a bear market, it is still a bull, the best shorts come after the market starts a downtrend. I know that is hard to believe. BUT IT IS TRUE!

Aloha