Friday, June 09, 2006

The Most Boring Trading Day I Have Witnessed In At Least A Year.

Bulls continue to show that they have no staying power, as trapped longs are selling on any short-term uptrend. A positive opening, like normal lately, gave way to a disappointing close. The internesting thing about the close was how close to the same % drop the indexes suffered. I guess I am a stock market nerd but I am not sure the last time all closes were this close.

The Sp 600 led the way to the downside with a .49% loss, the Nasdaq fell .48%, the SP 500 fell .45%, and the DJIA fell .43%. Pretty cool, if you ask me. Ok, now I know I have gone too far. :)

Volume was extremely lower across the board. As I said above in my title, it was the most boring day I have seen in a long time that was not holiday trading related.

Decliners outpaced advancers on both exchanges, with the NYSE having a 6-to-5 negative margin and the Nasdaq with a 3-to-2 negative showing.

It was a negative week for stocks, with the SP 600 falling the worse with a 4.5% loss, the Nasdaq down 3.8%, the DJIA down 3.2%, and the SP 500 down 2.8%. The bounce attempted near the end of May failed this week and the nice reversal we saw on Thursday didn't have much follow through on Friday.

All of this suggest what I have been saying constantly; and that is to stay cash heavy and don't trust any bounce after such a swoon that had a commodity stock bubble in it. These markets need time to work themselves out.

There is nothing out there of any quality working. All the stocks that are working are ALL in the defensive areas. These kind of stocks do not take leadership in a normal pullback. With these stocks coming to the forefront, I am afraid that I don't see much upside anytime soon.

The best thing to do right now is take a vacation, catch up on some exercise, watch some great movies, and stay very patient. You should also be checking up on the market because you NEVER know when it will turn. Normally, it is when you least expect it. But it doesn't happen this quick after a REAL top so I don't think I have anything to worry about next week.

Keep up to date with your charts and watch the ones that don't pullback that much and don't selloff on heavy volume. When the market is ready to turn, these could be the next batch of leaders. So ALWAYS keep scanning your charts. Just make sure you don't buy anything because you "think" it is a "bargain."

Stay positive and keep a smile on your face. This too shall pass.

ALOHA!

New Swing Longs: FMD ALTH WWWW--for more info on longs/shorts go to Investors Paraidse.

New Swing Shorts: TRI AVID

Longs Outperforming Market: GIGM-183 TSCM-152 SMDI-131 ACTG-99 KNOL-150 FSTR HSR-56 ICTG-82 BAM-32 PSPT SYKE ASPV PCLN ATRO PAY-45 NNDS AKAM-88 BWP EGY COGO-53 DDS LRCX-29 CBEY AOM MGLN EYE

Shorts Outperforming Market: USG-22 SWC-20 CRXL-20 CLF-15 MNST-14 FCX-14 ILF-13 ASA-13 WSM-12 EWY-11 NVT-11 JOYG-10 EWZ-10 ELY SIVB BPFH DB TMO DIA CE AMAT IYM RTP STLD RS ATI UAG RES MRK

Cover Short: CG

Stocks On Radar Screen: PWX WILC SCL

7 comments:

Anonymous said...

why wouldnt VOL be a long after Fri move ? thanks

Joshua_NControl said...

First of all the signal date was Thursday. Not Friday.

Second, I am NOT going to take a 10% risk in this kind of market with this kind of chart.

The volume was very active in this most recent base and the previous DEEP cup had a 40% plus correction.

This is HINDSIGHT analysis. I can find you six failed breakouts for every one that is succeeding in this kind of market.

This stock worked, SIMC worked, and many other wild ones I have passed on have worked. I just don't care. They could have easily failed.

The longs I have taken are working out, anyways. If it takes more time I am cool. Remember I was raising cash and selling climax tops when the markets topped.

Just go back and read my blog two weeks before the top and right when we topped. Then go read Thursdays commentary and see that I put VOL on my "stocks on radar."

Do you have to make money now to eat? Didn't you make plenty during the last market cycle? It is not neccessary to trade at this point.

Go take a vacation.

I know I am. Starting on Tuesday no commentary till June 20th.

Y.Y. said...

pressing on my buy button but didnt pull the trigger yet
i will buy though by tommorow noon the latest

Y.Y. said...

ok pulled the trigger now fully loading spx @ 1236
the truth is i do not have confidence at all but you gotta trust the cycles
cycles top again in late July targets 1265-75

Y.Y. said...

strong support DOW 10700 - 10800

Y.Y. said...

ok lets see if the bulls have anything left

Y.Y. said...

spx retests 1235 on LOWER volume