Tuesday, May 02, 2006

Big Cap Dominated DJIA And The SP 600 Small Cap Index Lead The Way As Markets Rise Across The Board.

Broad based gains for commodity and oil stocks helped lift stocks higher, on Tuesday. The Dow Jones Industrial Average hit another six-year high and the SP 500 is near a six year high. Hard to say the economy is scary when that is happening.

The DJIA rose .6%, the SP 600 rose .65%, the Nasdaq rose .2%, the SP 400 rose .5%, and the leader today was the NYSE with a 1% gain.

Volume was about even from yesterday on both the NYSE and Nasdaq. Breadth was positive on the NYSE by a 5 - 3 margin and positive on the Nasdaq by an 8 - 7 margin.

The good breadth, along with the NYSE and DJIA hitting six year highs and the Nasdaq holding the 50 dma, shows that the bear side is still not the right side to be on.

Proving this, once again, is the IBD 100. It managed a nice 1.4% gain, well outpacing the market. Along with the IBD 100, my portfolio gained over 2.5% today, showing that if you are long the right stocks in a bull market you will always outperform the general market.

That didn't mean I didn't have stocks go down. I did. But these stocks were my low quality momentum trades. Each stock barely represent .5% of my portfolio at any given time. The higher quality stocks either rose today or pulled back on very quiet trade.

Taking all these facts in consideration, along with the negative sentiment still THICK in the air, I am still bullish on this market. The only thing missing is some real broad strength by big tech stocks. The small stuff is doing well, via the SP 600 but the Nasdaq is still lagging the commodity heavy NYSE.

I am very tired tonight as I biked 20 miles in sixty minutes and ran 10 miles in an hour and a half. I think I will run the half-marathon this year instead of the marathon. That way I will be able to run the whole 13 miles. Then next year my goal will be to run the whole 26 miles. Then after that it is a triathalon!!

Surf will be up tomorrow on my home (backyard) reef so I am not sure if there will be commentary as I plan on surfing the whole day. So don't be too upset if I don't show up tomorrow.

Aloha from beautiful Maui!

New Swing Longs: PKTR KCS CPX SPI FSTR DEIX BSM KKD CGR NAVI -- For more info on the longs, go to Investors Paradise.

New Swing Shorts: NONE

Longs Outperforming Market(number is % gain since purchase): ERS-508 ATHR-111 SIRF-124 RATE-185 BBD-134 MFLX-192 BTUI-160 WIRE-187 GIGM-233 ASGN-107 PEIX-105 TSCM-129 LCC-121 IED-119 NXG-199 TGB-123 VGZ-143 BGC-99 WNR HOM-86 TGE-61 WF MDCC-42 TOMO-40 SMSI-58 COGO-61 UIC-72 NMR-44 TTES-45 SHFL ARS-55 AAPL GEMS-36 ROK-25 PETS-96 KNXA-75 BAS VTS-29 RADN-34 VIMC-80 SPIL AXE-41 EFII PNRG-50 FRGB EAGL-73 PKE BAM-36 BEAV-53 TRAD-53 LTM HEIA-39 KEX-51 WST ZEUS-62 CTXS-55 JOBS ICTG-70 MTU STRL-38 LRCX-43 IHS-42 TYL RUSHA STX-27 BWP DIL TMTA DRH-26 ECOL-43 CRUS ACTG-77 STKL-49 OMNI-55 ECLG-64 SA-27 EGO MXWL KGC-65 HNZ UBS-30 DB-29 WEBM STEL-25 SPSX-42 SWW-38 BE SFE VCP OMCL STD ILA TTEK NTO-78 LWSN PAY-50 DA BEAS-29 MWRK TCHC

Shorts Outperforming Market: NONE

Stocks On Radar Screen: ALY TZOO AAU

Taking Some Small Profits (example for newbies): IVAC

Last Sell Of Long Term Winner: ASF -- Selling final amount with a 173% gain.


Anonymous said...

hey josh, on you new longs- KCS is being acquired by HAWK, so its fairly valued and tied to movement of HAWK stock price.....OR_Kiter.
ps- is it healthy for your body to run 20+miles, no thanks :)

Joshua_NControl said...

It is ok. Normally, when this happens, I avoid the stock. But normally I am long the aquired company and the stock gaps up huge and I sell all my shares there.

When it comes to a merger, it doesn't matter. If the KCS chart converts to the HAWK chart, then I might reconsider the long. But the obvious accumulation since the merger, along with the active price movements, shows that HAWK/KCS has room to run. So whatever the symbol is I have in two weeks, I am still good with the long.

Mergers are different from companies being aquired.

It is healthy, if you have the energy I do!

Take care.

Anonymous said...

josh, do think this is a good place to add to MERX position at these levels since it held MA's and volume patterns OK...thanks

Joshua_NControl said...

MERX: Yes. Cut loss with a close below the 50 dma.


Response to mac question.

BSM: As you can see I went long that stock. Great eye. You saw what I saw. Nice job. It is not an IBD quality stock so this one is just a poke.