Thursday, March 31, 2005

Longs and Short of it

Big nothing day for the indexes. As for stocks here are some longs:
GHL NMTI GIL all have very nice chart patterns and all made strong moves today on big volume. GIL is still early its chart is just very nice and has a ton of accumulation. NMTI broke out of a 3 year cup with short handle on some of its biggest volume during the past 3 years. The handle was also very quiet, a good sign. A small postition with a cut loss around 7 is worth the potential upside. AEL is just another nice breakout with a strong cup chart pattern. A cut loss around 12.30 is prudent.

Other strong long charts are CYBX VSTA NXXI KV--A CFK

Also ELI looks coiled for a breakout alert set if should make a new high on strong volume.

Shorts: SFCC CDIS ZQK. If SFCC can rally back to 50 dma on low volume it looks like a good short. Chart is beatup. CDIS is back to 50 dma. A good short opportunity with a cut loss above around 48. ZQK is also looking tired and I dont think it is going back to its 50 dma. I would short now with a cut loss above the 50 dma.

Another short for IPO's is WOLF. If you can find some, this stock is good for a nibble as it almost made an engulfing outside day to the downside on big volume.


Some of the best shorts (if you can find them) are IPO's

CONR WRES ADZA all broke down below support levels. CONR also penetrated its 50 dma on high volume. WRES looks like it is prepared to follow. And ADZA is just another bio stock that bites the dust after coming out. If you can find shorts on these have fun. LVS is also spinning its wheels after falling below its 50 dma on heavy volume earlier this month and looks like a continuation drop is coming if it fails its 50 dma again.


I have been in this dangerous stock since the 10th this month at .75 and believe nippling a small amount at .70 is safe. I will cut my loss with a move below the .62 level. This stock has created a nice long base since Jan. 04. After having that big up day this month on its largest volume in its history, with beautiful green BOP on tc2000, and it continually bouncing off its 50 dma this speculative stock looks like a good long setup to challenge that Jan 04 area.


One of the few sectors working Retail has offered up an interesting play. I saw this last night but today's move convinced me I like RVI. March 14th move came on its highest volume in at least 3 years, then it pulled back and is now resuming its up move out of its improper cup with handle base. The base is improper because the handle has shown a lot of activity. I still like the chart on the daily.


NGPS is now trading above both moving averages and above its March high on good volume. This looks like a great round base with some great volume action within this middle portion if in fact that is what it is creating. But no matter what this is only a speculative play because NGPS has already had its great run and this base is too deep to be a proper base for now. But anyways a good play.


If DHC picks up some more volume and blast out of this two month long flat base, it will be a nice long.


ZMH has moved lower again on heavy volume. The false breakout in Feburary has been destroyed and ZMH longer term weekly chart shows a lot of distribution since July of last year. ZMH is a good short here starter postion and is a better add-on at the 200 dma.


If we can get a pullback on ITRI, an entry around 28.50 would be nice.

Wednesday, March 30, 2005

The oversold bounce that came.

Doing just as I expected the oversold bounce has shown up and did so on lower volume. If there is not much follow thru to this I think it is safe to say the short side will be upon us after this peters out.

I did find a few longs that looked good enough for me to take either a small position in or will wait for minor pullbacks from some that popped a little too much today: HITK MS DJO ESRX MON UBET. Most are medical and are just now blasting out of solid bases on good volume. The speculative one in the bunch that broke out of a flat base started in Febuary after putting in a rounded base is UBET. Cut losses on all if they close below their today's daily lows.

But, honestly, forget about the longs, for now. The short side is where the money is being made right now and I have a some nice ones tonight.

RECN has broken down again this time below 200 dma another bounce like previous breakdowns make it an excellent add to short position.

BVF ugly selloff in November created a jagged base that has failed this month. With today's pickup in volume along with falling below both key MA (50/200) makes it an excellent short on a pullback up to its MA's.

QSII gave me a bounce today to add a short position after yesterday's breakdown on big volume (took out two weeks of sideways action).

USAK is being chatted about and yet has put in a double top this month along with a high volume smackdown today. With the 17th, 18th, 21st and 29th days reactions this month (late day reversals and ugly candles) any bounce in this high P/E ratio to its industry group stock should be sold.

STNR has had two nasty big breakdowns the past three days and today it rallied to its 50 dma. This stock appears to be topping with those two selloffs coming on some of its biggest volume the past year or so. Since it is now at its new resistance a short looks good.

MHO this housing stock is busted. 11th day this year it has sold off on volume heavier than its 50 dva (day volume avg.). With this recent move down it becomes clear this stock is in sell off mode. A small add-on short here with more put on if it moves to its 50 dma seems like the right move.

USNA looks to be setting up for a fall. I just know charts and this doesn't look right. Needs more confirmation before it is a good short.

That is all for today, i expect the bounce to continue and the serial bottom callers to continue to come out. But unless volume steps in and charts start looking better and we dont have leaders popping up in the drug medical sector then we will be fine. But dont count on that happening. This is just an oversold bounce, for now.


Tuesday, March 29, 2005

Repositioning Before the Selloff by Barry Ritholtz

If anyone has, the above title is a must read.


PD rolled over today on big volume. A ton of churning since the last high volume sell-off in October. A starter short position is waranted here along with additions at the 50 dma. The whole sector is breaking and now this stock is following. Steel and copper are done for now. Duh.

Now the shorts for today

JCOM: if this thing rallies back to the 50 dma load up on the short side. This stock's breakdown today on that kind of volume leaves it in no man's land. If this stock bounces and creates a good short a fall below 200 dma seems logical.

MFLX: High volume reversal on March 8th led to current decline and now a breakdown below 50 dma creates a good short.

TRMB: second hard down day on big volume. Once again, a rally to 50 dma opens up a great short with support looking to come in around 20-25 area.

PRZ: nasty high volume reversal after its sloppy two month breakout four days ago. This amount of volume and that engulfing candle to the downside along with the sloppy move up makes PRZ an excellent short.

Also, I have exited all of my steel now. Selling the remaining TS. Looking at all former leaders SCHN MT STLD AKS TS TXI all breaking down it is obvious the run in steel is over.


The selling continues.

Well it is definitely getting more bearish out there but not extreme yet. I still know a lot of ppl trying to play from the long side and are trying to catch a falling stock market all by themselves. Shame on them.

Since the start of the year I have kept a diary of stock that either look nice or I take a position in. Today was the lowest amount of longs I have entered that looked good. And today none of them are worth buying but still worth holding are FINL and PSS which both made nice strong moves again with good volume. PSS bottomed in November on big volume, exploded beginning of March and has shown consistent accumulation since then. Chart also shows very few distribution days in it. Nice green BOP also on TC2000. FINL made a nice cup/handle base from April 04 to Jan 05 breakout. It wasn't perfect but since the breakout it moves up on strong volume and pulls back on little turnover. With retail doing very well in this environment, both seem like ok longs to have a small position in.

Monday, March 28, 2005

Sorry so late but day one is today

Ok, the market is currently in a downtrend and is still show very weak leadership with the fundamental leaders. Also with all the low volume stocks getting volatile (USEG GOAM SILCF UFPT PACT PTEC) it is obvious we are not in a great place as history show this always happen during a correction. With few stocks like ANTP PRM APCC AFFX SYNC currently looking OK it isnt really a great market for longs yet. Even though a short term bounce is probably coming since all ob/os indexes are oversold. So lets look at some shorts. I still think BRY is a short at its 50 dma with those two heavy breakdowns this month. Also I am still short XOM from that 11 and 14 million block sell by Merril Lynch on the 9th. Some good looking shorts after Monday's close were: if KEG returns to the 12 area a short looks good there with its continuos breakdown this month, a rally by PH to the 65 area is another short into resistance with it trading below its 50/200 dma and both turning down, going along with all my other oil shorts PTF joins the list on its second huge volume breakdown this month. These huge volume moves along with the early 2004 distributions and October heavy volume short term top makes me convinced any rally on this stock makes an excellent short. Moneystream on TC2000 is also hitting new lows while price is nowhere near. Very negative divergence.

Today I covered my XPRSA short for 25% gain.
I had to cut losses (all or partial) in PTEC PACT GOAM

BTW, I will never disclose all my sales. Soon enough you will see on the chart when I sell and why.


Trading unemotionally

This is a starter blog for me. As a former hedge fund trader at a young age and someone who has had off and on followings on the internet/software program in TCNet I decided I must share my knowledge to the world again. Why? Simple. I have been living on Maui for 5 years (obviously fell in love) and have still to find one individual who can do this successfully also on the island. So I have become lonely when it comes to chatting about stocks and must find a way to vent. I am a typical maui boy now, I go surfing everyday, I have a wonderful island woman I am in love with, and I don't miss the hustle and bustle of the mainland but as a technician with a fundamental twist I need to talk stocks. So here it goes. I hope you enjoy and learn something. I must stress I am an Investors Business Daily reader front to back everyday for 5 years. I have been using TC2000 as my primary software for 6 years. And have been trading since I was 16 (thank you Dad). I am going to use this first day as a rant and rave about what I do so incase people do read this and ask questions, saving me some breath.