Monday, April 03, 2006

Stocks Turn Tail At Noon, Disappointing Traders; Overall Big Picture Still Looks Good.

Stocks started off well and everything seemed to be ok. Then those nasty sellers came in and knocked the indexes down for the rest of the day. The damage was very minimal as the worst of the damage was on the SP 600 with a .7% hit. The Nasdaq and SP 400 weren't even down .2%, and the Big Cap indexes finished in the green. Of course, it sounded worse on TV than it really was.

Volume was higher on both indexes. But the higher volume on the Nasdaq has to be taken into context. The volume was below the 50 dva and was lower than the volume on the day it broke out last week. Not too sure how that can be as bearish as some commentators have made it sound today. Today is also not a distribution day, since the Nasdaq was down less than .5%.

To me nothing new has changed since Thursday. There is no way I can spin anything out of the market action the past two days. It has simply been lazy and uneventful. I dont have a whole lot of new stock buys pulling back, have some leaders giving profit taking signals, and have a lot pulling back on low volume. So pretty normal action in a normal bull market.

I spent the day playing poker. Nothing exciting. But if you want to become a better trader, I recommend learning how to play poker. There are some great principles in poker that apply to trading. Neither one is gambling, if you have history on your side. Nothing like practice makes perfect. Phil Ivey isn't Phil Ivey for nothing. Same with Brunson, Chan, Helmuth, and the others. Same goes with ONeil, Livermore, Darvis, and every other great trader. All had to learn the hard knocks way. It is the effort you put in that will produce the reward you deserve. As is life, so is trading.

Too bad some, including me, have to learn the hard way. Sometimes, you have to go broke before you really can start to grow and learn. Life, relationships, poker, and stocks. The same psychology is involved in all endevors. All of these things are great challenges and can produce some HUGE rewards if we learn how to control our emotions, place proper bets, and do it with love. If you do that, you can't go wrong. If you however can not control emotions, go all in too often, dont cut your selfish losses, and hate pursuing the dream, you will go wrong and will go broke. You have to love everything you do. If you trade stocks or play poker to make money, you will fail.

I just recently went broke in an aspect of my personal life and let me tell you what--it was the greatest learning experience EVER!!

So no matter how hard it seems or long the road looks, just keep at it. You will reach the end of that wonderful road by following the trend and riding the wave of profits that trend produces. Sometimes it can seem like a lonesome journey but in the end the rewards of all the hard work will be the joy you can give others by helping them complete their dreams. Sometimes, the lonely road is the best road to take.

I have no clue what I just wrote and like always I am not proofreading it.

Have a great day trading on Tuesday and I shall be back tomorrow. Hopefully, there will be a little more excitement in the air. It really seems that there is a lazy and sloth like backdrop to the past two trading days. Maybe it is daylight savings time. Who knows? See you tomorrow.

New Swing Longs: SPIL WF ILA ICCA AP -- for more info on these longs go to Investors Paradise and go down to Josh Hayes and click on 'longs.'

New Swing Shorts: NONE

Longs Outperforming Market (number is % gain since initial purchase): UIC-63 HOM ERS0234 COGO-25 MFLX-205 BBD-125 STRL CIB-51 MTU BOOM-416 VTS GEMS-27 SMSI-58 ROK TMI-29 NMR-39 WNR FRGB NVDA-93 VIMC-82 ORA-62 MDCC-46 TRAD-38 AKAM-108 CVO-92 CTXS-45 HEIA-32 SBAC-43 KEX-35 IHS-38 UVN SAY-38 PNRG-64 NTAP QCC KNXA-61 TGC-150 SATC-25 ACTG-51 RNAI-62 GIGM-115 IIP-38 QUIK AMKR TVIA STTS CLG-121 AUY-111 ISV-38 SYKE RBAK-220 GNA NXG-74 TXCO-58 BAM BWNG-140 MERX-47 OPLK ECIL TOMO-26 SWW-30 NTO-52 IMMR LWSN A RADN-37 NRPH-108 RCNI TFSM-44 SVNT FWLT-65 LMLP-44 TTES FC SMF BLD-46 PRKR MDM PROS

Shorts Outperforming Market: NONE

Stocks On Radar Screen: KEM UQM ATML TIII

Long Term Winners Giving Sell/Partial Sell Signals: UIC PETS -- still holding some shares. These patterns are just HISTORICALLY significant areas to lock in some profits. UIC exhaustion gap and PETS another HUGE volume 50 dma crack. Now are they both done? No. Especially PETS. Look at what NWRE did in early Feb. With the kind of fundamental growth these two have, the current run is done but the stocks are definitely not done. If the growth slows then it is possible they are both done.

Blowup, Disaster Of The Day: RDCM -- 28% gain to 11% loss overnight. No big deal, it happens. I would rather have a 11% loss from buying right than a 65% loss from bottom fishing stocks like INHX.

12 comments:

Anonymous said...

Aloha,

Shorts Outperforming Market: KEM UQM ATML TIII

should be

Stocks on the Radar screen: KEM UQM ATML TIII ??

-Bala

Joshua_NControl said...

Thank you bro!!!

Bala, how the heck are you??

wow, great to hear from you again.

Thank you very much for pointing out the error.

Anonymous said...

hey, great blog....and probably the only investor blog with a touch of philosophy :)....anyways, i am alwys trying to improve my sell rules when i have a profit and curious what your thoughts are on BHP...chart has been spastic this year so i've been focused on the weekly chart..is it time to sell ? (also any thoughts on taking profits on AAUK)....gracias

HedgeFundAnalyst said...

Hey Josh,

Saw a post of your's and was directed to this blog. I am already envious of your life. Hope to trade ideas with you!

-hedgefundanalyst

Anonymous said...

Aloha,

I am doing great. Thanks for being there and helping us out.

I have been using your breakout strategy and riding the trend and importantly cutting the losses early.

FYI, there is this great trend trader who publishes his long term trending stocks. He listed 25 stocks and out of those you own 14 based on your daily list. This tells me you are truly a trend follower and you are sync with the market. That is why your picks are simply AWESOME.

I am very, very happy to see your success in the market and I wish you much more in the future.

-Bala.

Joshua_NControl said...

Thank you for your very kind words.

BHP: stock is fine. I don't see anything currently scary on the chart. Just a nice steady uptrend. The most recent base was very loud (a lot of trading) and that is not normally you want to see in a base. So keep watching it closely. If you have been holding BHP for a long time I would be looking for anything that resembles a parabolic move to take some profits.

AAUK also has nothing saying "Sell" in its chart. The most recent base was also sloppy but both charts are like that. You play some dangerous choppy stocks but both are fine.

Continued success. Thank you for your very kind words.
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hey, hedgefundanalyst. No problem. That is what I am here for. :)

My life is great. The most important thing in my life might have just walked out. But that doesn't change the fact that I have a great life still.
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Bala, you are a class act. You are one of the first readers and if it wasnt for loyal readers like you I wouldnt even be doing this.

Keep up the great work. I am really happy to know that this is helping. It makes me feel good knowing that I am doing this for people.

Considering, I dont do anything else. LOL.
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Anonymous said...

Hi, Josh, continue to learn a ton from the blog. What do you think of the following charts as possible buys on breakouts - RNWK, STAA, CRUS.

Also does SILC look ok here as a pullback?

As always, thanks in advance for all of your work. It is appreciated.

Anonymous said...

love hurts, but a day in the water surfing or kiting always cleans the mind.

misstopsy said...

I am glad to read a hint of optimism in your post today :)

Anonymous said...

I've posted here once before... remember, you are not alone in this... you have many invisible friends :)))

Would love to hear some trading/poker analogies if you ever feel like it...

Joshua_NControl said...

RNWK STAA CRUS SILC

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I had a great time and was popular with the girls in high school but never fell in love until two years ago. So I had no clue this is what heartbreak felt like. Love does indeed hurt. Thank God, time heals all wounds. I am an extremely strong and positive person. I have gone through many things that should have prevented me from coming this far in my life. This isn't going to stop me either. :)

A day in the water is good, IF THERE ARE WAVES! lol. We have been flat and have had rain for almost a whole month. When it rains it pours. At least the skies have cleared up. Sadly, now we have no swells.
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Topsy, I am even happier now, after seeing you post on my blog. Thank you for being such an amazing friend. I can not thank you enough, for all your wonderful advice. You are such a successful and sweet person.
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You know what, my good man. That actually sounds like a good idea. I am sure everyone has played poker. I play a lot. At least two hours daily. I think that is a lot to normal people. lol.

I have noticed TONS of things that apply to poker that apply to trading. It is amazing how the psychological aspects of each game correlate so well. And what helps even more is if you a good at one, you have a good chance at getting good at the other.

Why does that matter? Have you ever played poker seriously for "fun" money (wink, wink). Cash tables can offer excellent returns and the tournaments (if you are good) can provide consistent side income.

This is only if you at first know the game! Once again, if you don't read books and play a TTOOONNN of play games and small cash games, you will not have a very good start.

Also live and online are two totally different games. Online poker is the only game in town. But I have played many live ring games in Vegas so I am not a complete douche bag at the tables.
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Man, oh, man. I hope one day I can meet all you great people. I am sure I will.

I should offer one on one training weeks. lol. That way I can write off my vacation. And if you think by vacation that means getting away from stocks, you are way wrong. That I can never do. Vacation or not. Not knowing what my charts did and knowing that I have access to them is unbearable. It is like air.

Hey, some people love watching sports. I love watching charts. But dont get me wrong I LOVE LOVE LOVE sports.

THANK YOU ALL FOR BEING SUCH WONDERFUL PEOPLE! Your support is just what I need.

This feels like another family. Thank you everyone.

Joshua_NControl said...

LOL, I forgot to list my status of those stocks.

RNWK: new long tomorrow

SILC: I am long this stock from November. The pullback is normal.

STAA: I am long this stock from end of February. The basing is normal.

CRUS: I have sold half with a close below the breakout day's open. Holding other half.

All stocks look fine.

Disclaimer: I can not recommend buying any stock I am already long.