Thursday, August 28, 2008

No Market Commentary Tonight–Market Wrap Video Is Updated For Gold/Platinum Members

August 28, 2008

I am picking up a friend from the airport, running errands, and going out to eat tonight. This will not allow me enough time to write commentary.

However, if you are a gold or platinum subscriber you can go watch the 8 minute long market-wrap video on the forums or listed in the chat room. If you are are not a gold/plat subscriber you can go to youtube and do a search for the market-wrap videos as they are being shown on there. The quality is 25% of what the members get but at least you can learn where the market is at and the stocks I am interested in, if you are not a subscriber.

Have a great Thursday evening and I will be back to a normal schedule tomorrow and will have everything updated like I do 99% of the time.

ALOHA and thank you for being so kind and understanding!!! It’s not like the market is doing anything spectacular on high volume.

Wednesday, August 27, 2008

Stock Indexes Put In Some Decent Gains But Do You Notice The Weakness Intraday And Inability To Close At Or Near The HOD?

August 27, 2008

Stocks put in a good day due to good Durable Goods numbers but I want to bring to the attention of newer investors something that is happening recently on the up days.

Do you notice that a lot not (not a ton) of days where the indexes go higher it does not close at or near the HOD? This in a downtrending is not good. Even in our current sideways market the up days show more intraday weakness near the highs than intraday weakness during the down days. Now while this is nothing to scare you since you already have PLENTY of reasons to being heavily invested in cash. It is just a hint that when a real trend starts again-that we can finally make some real good money again-that the trend will be down.

The leading stocks right now still continue to be medical and while that is good for those solely invested in medical stocks. It is still not a full group leadership by many industry groups. So while I personally have been going long medical stocks and have many medical stocks on my watchlist because it looks like (on my weekly charts) that medical stocks could put in a nice run here (just look at THOR) and I want to have at least 10% of my money invested. But I have learned that even though something looks good today, even in medical, in a bear market profits can be wiped out for no reason in an instant. So for some that are as experienced as me and can see all the same medical stocks that I list in the forums as stocks that are “possible future longs” and you can see currently a few high quality medical stocks that I want to buy off the 50 DMA or a breakout from a long base so to increase my odds of having a winning stock, you can increase your percentage of holdings in your medical stocks.

However, if you have more than 50% of your money invested and the markets roll over on you it will be your own fault because you are playing against the odds. It would be like you having a 7 2 off-suit in Hold ‘em and the guy you are playing heads-up shows you that he is holding bullets (pocket Aces) and you put in him in all-in. It is just stupid and against the odds and nothing but a pure gamble.

But sure you experienced guys that get some nice medical stocks (not like MR–there were flaws in that chart that were obvious to me and I might make a video on it to show you how not to get suckered in to weak bases with flaws) setting up, feel free to put up to 25% of your money into them. They seem stable, for now. For me I will stick to 85% cash and 15% invested. This is not 1999 or 2003 when the indexes were trending up on higher volume and never going below the 50 DMA while having 10-30 PERFECT (max green BOP, big price gains, and HUGE volume suges) charts setting up and breaking out. This kind of market WILL SHOW UP AGAIN. Especially after a long bear market like we are starting to get as we are about to enter our 11th month from the top on October 31, 2007. I currently have one perfect chart where I usually see 10-30 in a bull market. So we are no where neer we need to be.

But let me be clear. Those of you that can not make money going short, WHEN THE MARKET IS READY, like November to January, need to avoid trading to be trading. Please after you read this go to the “new short positions” and read that so you can learn why I did not go short what could have been a perfect setup and please to to my “new longs positions” so you can learn why a possible perfect move can in just one-day lose its beauty and thus become just a normal long to take to try to make rent/mortgage payments.

There are times to load up on stocks to the long side (in a bull market) and there are times to load up with shorts (in a bear market.) But when you are trendless since January you just have to wait till the market starts moving on volume after this low volume period that normally happens right before Labor Day. So keep an eye on your leading stocks (medical stock right now) and keep that cash level high so that when this market turns you will be ready to get very long. Don’t forget: CASH IS KING!!!

“Profits can be made safely ONLY when the opportunity is available and NOT just because they happen to be desired or needed …Willingness and ability to hold funds UNINVESTED while WAITING for real opportunities is a key to success in the battle for invesment survival.”–Gerald Loeb

Another Day Of Active Headlines But A Dead Day For The Indexes

August 26, 2008

If today proves that headlines don’t mean anything in the short or long-term of the market. I don’t know what would make you believe that news stories are just ways for journalist to describe what is happening. After waking up and going over the news stories of the morning I expected the market to be up big or down big as a lot of action was going on out there.

Of course, when I go to take a look at the US Bourses it became clear that the headlines did little to drive the market anywhere. That should help people realize that it is not the news that drives the market but the market of buyers and sellers that drive the market.

One of the for surest things I thought I would see today with all the active headlines was at least heavy volume. Proving that supply and demand and what institutional funds think is more important even volume remained lower. So basically what I saw today was a very noisy day that seemed to even try to put a positive spin on things so the market can rally higher.

Another disturbing thing I saw as soon as I turned on CNBC which is something I rarely ever do is that I head the word “buy” so many times that I was very upset at CNBC by the time I had enough of this waste of airtime. Telling mom and pops to buy stocks on the way down post 1999 is such a disturbing and is such poor advice that I can not believe “mom” and “pop” still don’t get it.

I see Cramer out there with a weak performance in this Action Alert Plus account yet CNBC does all it can to promote Cramer while at the same time it does NOTHING TO EVEN MENTION THE IBD 100 OR IBD 85-85 INDEX. I guess this is because to buy a stock, then watch it to see if it goes up or down, and then to actually have to cut your loss if it does not go higher must be too hard for “mom” and “pop.”

Well I am one of those people that not only get insulted by the lack of IBD index mentions but how silly that channel is as it expects that we are too stupid to buy high and ride a stock higher. No, instead on CNBC, for about two hours today all I heard was if you some would go “short FNM or FRE” or if they would buy “this or that stock on the pullback.” Never mind that this time the pullback is on VERY HEAVY VOLUME and is clear distribution and not a nice pullback that will lead to institutions supporting the stock.

Right now, in this market where the summer doldrums is shown via the extremely low volume on the indexes I want to really stress to those that are taking the time to better their life by reading my blog to NOT BUY ON THE PULBACKS. YOU SHOULD ONLY BUY WHEN THE INDEXES ARE GOING UP ON STRONG VOLUME (NOT THE BELOW AVERAGE VOLUME WE HAVE NOW) AND THE MEDIA IS TELLING YOU TO BE AFRAID OF STOCKS. When the media is telling you to buy stocks now and telling you to do it while the indexes are on the way down, the bottom line is, CNBC must be totally clueless to how the greatest investors make the most money.

Jesse Livermore, William O’Neil, Geral Loeb, Nic Darvas, David Ryan, Lee Firestone, Bernard Baruch, James DePorre, and many of the other greatest trades that ever lived KNOW THAT YOU BUY STOCKS IN A MARKET THAT IS TRENDING UP WITH THE 50 DMA ABOVE THE 200 DMA. AND WHEN THE MARKET IS GOING DOWN (OR SIDEWAYS LIKE NOW) THEY KNEW IT WAS BEST TO BE IN CASH OR SHORT (OR IN OUR CASE WHERE THE MARKET IS GOING COMPLETELY SIDEWAYS, ONLY CASH IS THE SAFE PLACE TO BE) ESPECIALLY WITH THE INDEX PRICES TRENDING BELOW THE 50 DMA. The bottom line, right now, it is not safe to be long stocks.

From November to January we made good money going short stocks. How were we able to do that? Easily. The market fell over 20% during that time. Since January the market has barely moved 10% up or down and that has caused the past seven months to be very difficult as CASH HAS BEEN KING. IT STILL IS and until the trend breaks out upwards or breaksdown downwards, there is nothing INTELLIGENT TO DO. There should be 10-20 HOT!!! charts right now if we were about to have a bull market. But right now we barely have two. Same thing with shorts. If this market was ready to breakdown hard, we would have excellent setups right at the 50 and 200 DMA that would be breaking down on heavy volume. So this is a wait and see market. It is easy for me to chill out and wait for perfect charts. But for those that do NOT know their history and/or are here to get rich quick…this is where the game KNOCKS YOU OUT. This is why there are so many great stocks during bull markets. I can show you my hotties all day long because SADLY 90% probably will not be here in three years. This is why Jesse Livermore says this will always work.

Human emotions NEVER CHANGE. Greed and fear drive all humans. And since we as a culture HATE to study history. Those that do study history are guaranteed to make a fortune EVENTUALLY!!!! Aloha and I will see you tomorrow. Don’t forget gold/platinum members that I have a Tuesday Market Wrap video with some charts of stocks that look good and don’t look good. So enjoy that gold and platinum members. I know you guys are loving the videos. AND I LOVE MAKING THEM!!!! ALOHA!!!

Tuesday, August 26, 2008

A Whole Lot Of NOthing To Talk About

August 25, 2008

Usually on a day that sees all the indexes fall 200 points there is a ton to talk about. But the fact that volume was extremely low and that I have been talking about this recent volume failing there was not a whole lot of anything new that happened today.

I think the oddest development was that volume was so low today. I know we have had a lot of low volume days but to have such a wide and broad selloff where so many stocks got hit by low volume was quite weird. The low volume breakdowns make it very hard to go short a market that could be coming up to a selloff on heavier volume. By the time the heavy volume comes into the selloff most of the stocks will probably will be too extended from a safe short pattern.

So for now cash continues to be my old faithful. I mean when you go long strong stocks like HGR and you immediately get hit with that kind of reversal there becomes know question why being long is so dangerous. There is one long that starts with the letter X that is doing well for me but overall one stock out of 8,000 that looks HOT! is not a good sign for a long-term rally. Especially when the SP 500, NYSE, DJIA are all under the 50 DMA and the Nassy is below the downtrending 200 DMA.

This is a lame pullback and from 1/24/08 to 8/25/08 the stock market has barely moved .20% on the Nasdaq. From November ot the January lows (intraday) the market fell almost 22% making it very easy to pick off shorts in that bear market. What we have here is NOTHING like what we had from November to January. And for those still trying to go long stocks “heavily,” it is obvious that you have not read any of the books I have recommended and you continue to not listen to me when I say DO NOT GO LONG STOCKS IN A DOWNTREND. 3 OUT OF 4 STOCKS FOLLOW THE GENERAL TREND OF THE MARKET AND WITHOUT HOT! HOT! HOT! MAX GREEN BOP PRETTY CHARTS, CANSLIM STOCKS, AND A MARKET MOVING UP ON VOLUME THERE IS NO WAY PEOPLE SHOULD BE GOING LONG OUT THERE. Be very careful out there and REMEMBER CASH IS KING.

For Platinum and Gold members two more new videos are posted. My daily “market wrap” video and another video on another PAST BIG WINNER that CLEARLY made a climax top which signaled you to get out on the way up. Many of you seem to have a tough time with this so tomorrow we will go over another one from 2006 called ERS. Aloha and I will see you in the chat room which is more active than this market. ALOHA!!!

Friday, August 22, 2008

Stocks End The Weekend The Way They Started: Without Volume And Flat

August 23, 2008

This was one of the lamest weeks all year as stock market indexes barely went anywhere. Not only that I have to admit that not much happened that would have me excited about the upcoming week. The only exciting moment in my stock market life is that we have the power to create screenshot videos and show you exactly what I am looking at as we go along. That can only help you become a better trader.

My biggest problem right now is getting inexperienced investors to stop trading this trendless market that is doing its best to drive a lot of traders nuts. The smartest traders realize that most breakouts in market environments like this fail immediately. But there is still a handful of egotistical traders that believe they can be the 10% that can beat the overall market when it is in a position not to be beat. That is about the only thing that is driving me nuts right now because I know when it is time to not be doing anything and that time has reached us.

There are some people that are for sure there are great stocks out there and that we just can’t find them. Those folks are wrong and the fact is that the only stocks that are doing well right now are stocks that do well in bear market environments. That is medical stocks, consumer durable stocks, and other safety stocks like soap and other products that sell well even in a market that is going nowhere.

That is my biggest problem with this market right now. I have never had a problem with a bear market. I understand that stocks mus fall and that it is only fair to be able to profit from them as long as they setup in correct short patterns. However, if the stocks dont set up and go past logical shorting points there is nothing you can do and you just have to miss making money on the short side. It sucks but it is the way it goes sometimes.

I am not for sure which way the next break will be but the way the charts look and the lack of beautiful charts setting up I would have to say eventually we are going to break lower. If that is the case I will se looking to go shor the best of the best from 2003 to 2007. There were tons of stocks that made double to triple digit gains that will eventually come back to earth when this is all said and done.

Right now, until an uptrend or downtrend is clearly presented in itself in the Nadaq, NYSE, DJIA, or IBD indexes, it is foolish to go either long or short right now. I know many traders who are going short and failing and many traders going long and failing. Besides a few longs like XSI, DGLY, PDO, and XCO it has been a very pathetic 2008. This has been the worst year of trading for myself since 1996 and back then I did not know what I was doing. So I am hoping that an uptrend or downtrend can come about and end this sideways action that is killing my personal accounts as I can not make a solid living returning 0% this year.

At least I am not losing money. I have heard a recent horror story of someone trading their personal account down 48% this year. That is horrible and that is impossible if you learn to cut your losses. This is why I stress that you must always cut you rr loss at 7-8% or at the 50 day moving average NO MATTER WHAT. When you are wrong, admit you are wrong and do not suffer any more unnecessary pain that what is necessary.

Aloha and I will see you Monday where hopefully something else moves like XSI. I need more beautiful max green BOP medical stocks that are setting up and breaking out of sound price patterns on strong volume to salvage my year. As you can see in the mutual fund section all of the best mutual fund are doing horrible. Even the best funds are having horrible years. So if you are flat for the year and are used to triple digit returns during strong bull market years like 98, 99, 03, and 04 just remember this happens and you will have to deal with it. This too shall pass and eventually another great bull market will come along with many 100% to 2000% winners. For now we just have to deal with this flat market. Rememer, this too shall pass.

Until the time comes feel free to learn in realtime about the stock market in my new videos section. It is only available to the gold and platinum subscriers and the information in each of the videos I am sure will greatly enhance your investment ability. The videos have already been received very well and I can only assume as we get more winning stocks showing up and I can get in depth with the past true PAST BIG WINNERS the videos will only help you become a better investor as time goes along.

For now, that is all we have until the market turns up or down and a downtrend or uptrend restarts. For now this market is bumming me and most participants out. But thankfully I know my history and know a trend will soon return. It is all about patience, protecting your capital, and keeping your watchlist updated. Be careful out there and remember this too shall pass and we will soon have a powerful rally one of these days that make us a ton of money. Just be patient and do NOT force trades. Whatever you do just be patient and let the max green BOP, heavy accumulation, and perfect price patterns come to you. Don’t you go looking for them; they should find you.

Thursday, August 21, 2008

Starting To Get Worried But Not Really

August 22, 2008

I hope that my internal feelings are a contrarian but as every day that goes along that I continue to scan my charts and see nothing that looks like it wants to rally or make higher highs in a proper fashion I get a little more nervous that I begin to think that this bear market is going to go on a lot longer than I would like it to.

I am not sure where I heard the saying, or if I even ever heard the saying and have come up with it on my own by studying the market, but if a bear market does not last six months or less it usually last two years or longer. The problem now is the it is clearly past six months since the top in November but at the same time there are absolutely zero charts that are ought there with beautiful patterns that make me feel comfortable that we have a real rally coming along any time soon.

Instead what I see are ugly rallies in medical and other defensive stocks that do not give investors a safe chance to get in or are in chart patterns that are so V-shaped that I am not sure people should be getting involved anyways. However, it doesn’t matter what I say, newbies constantly think they are smarter than this market. So I’ll watch them bottom fish FRE and FNM till they are broke. If you loved it at 60…you’ll love it at…3.

It is just amazing to me how many times I can say “DO NOT GO LONG STOCKS HERE BECAUSE IT IS TOO DANGEROUS AS THE MARKET IS TRENDLESS,” how many foolish traders will literally buy a breakout on margin and watch that breakout reverse and kill them on margin. Unless the trend is up there is no way you should be going long stocks. At this point I feel like no matter how many times I tell newbies to not go long they are not going to listen to me. Some people are saying, “but Joshua, you went long that beautiful chart XSI and made a pretty penny in that.”

First off, I have made it clear that those that are experienced are allowed to trade if they feel like they have a perfect stock setup. XSI was mine. I took it. If you are a newbie there is no way you can tell how beautiful something like that is and you can not risk your money on that. I have seen SMART TRADERS go long MR, MPWR, and OPTR during this recent market. Each breakout was ugly and showed signs that they were not going to work, had red BOP somewhere in the chart, or had other problems that made them poor longs. However, these smart traders still went long. The difference between their mistake and and newbies. Their mistake more-than-likely barely cost them. A newbie would have loaded up on XSI, MPWR, MR, and OPTR. Then he would have told you about the XSI trade but not of his other three losers. Thankfully for me (which I showed you a video of MPWR being ugly compared to XSI) I went long XSI and am very happy about it.

Am I upset I did not buy more? Yes. But is it ever smart to buy a stock with only 59,000 shares average and only $6 a share? No. This is a tough market and remember just because us experienced guys are having fun dinking around with a trade here or there does not mean that you should be playing around also. Do you see how low the volume is on the Nasdaq and NYSE? Do you think any of the big boys are anywhere around? You better believe they are not. Volume doesn’t ever look like that unless NYC is in the Hamptons.

Volume is low and while the big boys are gone you should go out and enjoy your life. You never know what tomorrow might bring. Hey, how about that China crash nobody is talking about? That’s something huh.

Stocks Put In Weak Gains On Even Weaker Volume

August 21, 2008

When it comes to making a living in the stock market I have had no problem doing that for the past thriteen years. But all of a sudden this year, this trendless market has made it near impossible to make a lot of money. There are a few mutual funds that are up for the year but the majority of the greatest funds and greatest traders are finding it very difficult to make money in a market that simply does not go anywhere.

Now, while we have had some big winners like PDO, XCO, and DGLY, we have also had some disappointments like BRKR BKE and AEHR. If this would have been a start of a bull market, like 2003 was, after the 2000-2002 downtrend, I am sure they would have all worked but for right now things still rarely work. But it is obviously clear to me that this market is not moving up or down and that it is just going nowhere. Why then, in God’s name, why would you be wanting to be going long or short stocks.

It is clear from where I sit that stocks are going nowhere and the number one thing that I look for when I am going long stocks is to see if the market averages are rallying on heavier volume. I don’t just want to see one stock move higher, while the rest of the market indexes and the rest of the stocks are going lower. I want to only go long stocks where the whole market is moving higher thus putting the odds incredibly in my favor.

I mean if you just compare the returns from 2003 to this year, it should become fairly obvious that there were about 1000 more stocks making 100% moves by now. I have not had one stock up 100% for me this year. If this contiues to be the case it will be the first time since 1996 that I will not have owned at least one stock that went up at least 100%. If you look at all the beautiful perfect chart patterns with green to max green BOP in 2003 and then try to find any this year you will find your adventure useless. There is nothing nice out there and I can’t see anything coming around the bend any time soon. I have one long that I am long that is very pretty and I see one stock setting up that is very pretty. But back in 2002 before 2003 was coming I know I saw at least 10-20 stocks that were loaded up with green BOP and perfect price and volume patterns. The fact they are not around now is a big enough clue for me that I need to be patient and just exercise waiting for that right time to get back in the market.

For all of you itching for action, you are showing your immaturity and ignorance by trying to go long stocks here. I recently posted a video that showed just how sloppy MPWR was. MPWR was such a recently beloved stock that had many of my newbie subscribers going long despite the fact that I did not go long. I was clueless as to why these people like the stock so much so I made a video on it. After watching the video I hope that some of you now know what an ugly chart looks like. And for those that have already seen the XSI (9 minute video) video you will see there was a major difference between that HOT! chart (which really isn’t even that hot compared to my past big winners from 99 and 03) and the difference between stocks like OPTR, MR, and MPWR.

I know that for most of you the videos will be big help in helping you being able to see exactly what I see and the reason why I pick certain max green filled stocks over some near-CANSLIM long positions. These videos should be very powerful and should be able to show you how easily it is for me to scan through my charts, quickly eliminate the ugly charts, and focus on the powerful charts that are loaded with accumulation and green BOP. This will be a feature that I am sure will help some of you recognize why I love a chart like XSI over a chart like MR or MPWR.

Getting back to this market that is as dead as can be. A driftless market on low volume is an impossible market to trade and the amount of trading that I am seeing out of newbies is quite disturbing. I continue to tell all of you young guys to STOP TRADING, THAT THERE IS NO TREND, AND THAT THERE IS NO VOLUME TO HELP MAKE A LOT OF MONEY ON ANY STOCK THAT DECIDES TO MAKE AN ACTUAL MOVE. The best thing to do right now is nothing. Going long is almost guaranteed to leave you trapped in a falling stock and if you go short right now the chances are high that even if it does work you will be hit with many reversal that are so painful that it will probably scare you out of your position before it ultimately goes lower (GS and BG are both recent examples that are moving lower without me even though I was short these stocks on their intial breaks).

Right now, it is all about protecting capital and that is what I am preaching right now. Be careful out there and wait for un uptrend to resume before getting
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Tuesday, August 19, 2008

The Nasdaq Continues To Fail At The 200 DMA On Lower Volume; You Don’t Need Heavy Volume To Start A Nasty Selloff

August 20, 2008

I have to admit that I saw this failure coming a MILE AWAY and have been fully prepared for it and all of my platinum members can verify this as I have been saying repeatedly that this rally was going to fail. Yet I still had NEWBIE subscribers trying to buy breakouts left and right.

Part of the problem is that I will mess around with a few hundred dollars in a stock out of a very large cash amount. Most of you can not dink around like me and must wait for a perfect setup (like XSI was close enough to) before you make your move. I will go out and buy stocks like GXDX. But that in no way, in this market, that is going nowhere, is any kind of signal for you to buy stocks.

I don’t know why some of you don’t get it but it always seems to be the cocky-ignorant-uneducated-newbie that comes into the market thinking “there is always a time and a place to make big money. The truth is if these “fools” would take the time to read the classic stock market literature and listen to the professional about not trying to go long in a tape that is moving anywhere maybe some of them would have a little bit extra money in their pockets.

But nope, instead they try to “outsmart” the market which always ends up humbling them and the next thing you know they are in a 50% correction whereas if they would have just stayed out they would have avoided all the pain.

I have spent some recent time the past few days posting videos and in some of those videos I showed you the difference between how a LOT of stocks looked then back in 1999 and 2003 when perfect max green BOP and heavy accumulation charts were everywhere and compared that to the current crop of nothing that doesn’t exist out there now and it becomes apparent that the time to do nothing is upon us. Some day that will change but for now with the Nasdaq re-rolling below the 200 DMA on strong volume, The NYSE and SP 500 refusing to retake the 50 DMA with the 20 DMA trailing right behind it, this market is in no way in any way shape or form ready to be bought. Especially with the leading Chinese stock market index the Shanghai Composite rolling over and hitting new 52-week lows on strong volume. And they are not hitting new lows barely. The last attack I saw was a 5%-plus plunge lower well into new 52-week low land. How can the people involved in our markets be looking for such a move when the indexes are hitting lows on such powerful price declines with little to no charts that are setup in winning stock positions.

No matter what you believe about supply or demand I am telling you right now that there is NO demand for stocks. That is why you are seeing a very low volume selloff. Eventually people believe people have to step in and buy stocks but I don’t know I just prepare myself for some potential big gains on the upside (but first I need my green to max green BOP charts to show up or else I KNOW the stocks will not hold on to their gains and I will end up with nothing to show for all my hared work) or prepare myself for some damage to the downside which is more and more what it looks like that will happen.

However, right now we are still in a big nasty flop and chop market that is giving trend following investors some whippy rides and that means that pocketing your cash and leaving them on the sidelines remains the right play. I believe that if this market continues to move sidways and continues to do this with volume contracting and contracting that it will not lead to a new bull market and instead it will rollover and start another leg down. This leg down is what we need to try to convince people that the market can come closer to putting in a real rally.

I keep telling everyone the more you all keep looking for a bottom. WHICH IS EVERYONE OF YOU NEWBIES. The longer it is going to take to make a real bottom come along. If you do not get a market bottom within the first six months the chances are that it will take 24 months before you get a bottom. That is because if a big crash does not come along and scares everyone out in the first six months what normally happens is you have to go through a series of rallies and failures that eventually lead to a bottom that wears everyone out. By the time this bottom happens so many people have lost interest in the market that those that are still around are the lucky ones that end up getting filthy rich as the green to max green BOP setups on super star stocks that go on to produce amazing gains. All you need to know to prove that is to go back and study my own work in 1999, 2003-2006, and the occasional stocks in 97, 98, 01, 02, 07, and 08.

The bottom line is that in this summer doldrum do not make any crazy large bets as ALL of the institutional mutual, pension, and hedge funds have gone on vacation. Keep your trading small and do not go long stocks that are anything less than perfect. This market is too dangerous to go long. And for further info please do not go short until volume picks up on the downside. Right now, the market is stuck in a dangerous VERY LOW VOLUME range where prices are going nowhere.

To sum it up from February 4, 2008 to August 19, 2008 the Nasdaq has moved a WHOPPING .06%. Do you really HONESTLY think we can make big money in a market like this???? Folks it is just as bad going a full another month back. From January 16, 2008 to August 19, 2008 the Nasdaq is down -0.43%. How do you make money in a market that does not have an up or downtrend when you are a CANSLIM/momentum/growth investor. I’ll tell you: you don’t!!! You exercise patience so unlike all the SUCKERS that gave up in 2002, you can be ready for the next TASR HIL SINA SOHU NTES EVOL EPIC NTES FMDAY EGHT and so many others. And if we ever have another 1999, we could get stocks that make 500% to 1000% moves in months. I doubt we will ever have a Y2K speculative no-earnings momentum market like that ever again. And that is just too bad.

For now, stay patient, keep a tight lid on your cash, wait for that perfect long setup (something similar to XSI), or wait for that perfect short setup. We have plenty of time and as long as volume stays this far below the general 50 day volume average there is nothing to do. Keep a tight lid on your wallet. There are no shorts and there are no longs. Enjoy your summer vacation while it last.

Hopefully it is not spoiled by an up and coming possible selloff. But I tell you what when you see only see 21 new 52-week highs to 210 new 52-week lows it sure doesn’t help support the bulls case that higher prices are coming along. But heck more chop proves to be in store with a put/call at 1.09. There is fear, there is euphoria, and there is apathy in this market. Some pretty strong emotions leaves to some major battlegrounds. I don’t know how long we can go sideways but I bet it can be a lot longer than mot of you think.

But heck no matter how long we move sideways, that is your perfect time to read every book published by John Boik who profiles all the greatest traders and monster stocks throughout the past. This also gives you plenty of time to read HTTMIS by O’Neil and Reminiscences of a Stock Operator by Lefebvre (about Livermore). This also gives you plenty of time to study EVERY SINGLE ONE OF MY PAST BIG WINNERS. ESPECIALLY THE MAX GREEN LOADED BOP charts of 1999 and 2003.

And one last reminder for gold and platinum subscribers: I have started to upload videos and believe once Bob gets the next two up tomorrow I will have around 5-6 excellent videos where you can hear me describe in deatail what I am looking at on my screen. The feeback has been BEYOND AMAZING!!!!! Thank you all for your kind comments. I am so glad you love the videos. We will have a new one every day over a new subject and we will off the freeloaders a freebie weekend post since they are too cheap to pay for my INVALUABLE service. ;)

Aloha and I will see you winners in my chat room around 12pm to 2pm EST. ALOHA!!!!!!!!!!!!

Monday, August 18, 2008

Nasty Selloff Comes Just As I Expected; I Am Still Waiting For A Huge Up Day On Huge Volume To Confirm This Move Is Real

August 18, 2008

It really is hard for me to find much to pen about here other than “I told you so.” Those that do not learn from history are doomed to repeat its failures and those that have not learned that NOT EVERY FOLLOW-THROUGH DAY LEADS TO A BULL MARKET BUT NO BULL MARKET HAS EVER STARTED WITHOUT ONE are going to have a tough time living through this bear.

The great news, some can say, is that volume was much smaller than what I would like to see on such a nasty day. Now, this could be good news or bad news. It could be good news as that the weak volume selloffs could be met by higher volume accumulation. However, I doubt this will happen since the rally that preceded the 200 DMA breakout on the Nasdaq was on lower volume. So it just remains a big choppy low volume range bound market to me.

The negative is that a lot of times in history low volume selling has started off some major declines and only after the selling becomes apparent and painful does the heavy volume selling hit the market. So that is something to think about as the stock market indexes come upon failed breakouts and tough resistance.

A reason I believe our low volume selling can start of low and pickup the selling and we will not rally has to deal with an index chart somewhere far away from the USA. I know we are two different countries but there is no doubt the Chinese stock market is the leading stock market. Those that do not have access to a chart (SSEC-X on TCNet) may not know but the index is ONCE AGAIN, for the fifth time at least since the November top, rolling over to new 52-week lows. Now this index is not just barely making new lows. This index is dropping hard. Dropping another 5.33% after earlier dropping 4.47% and 5.2% in back to back bloodbath sessions. Since the top in November, the SSEC-X (Shanghai Se Composite Index) has dropped an incredible 58%!!

This was the leading index during the previous bull market of 2003 to 2007 and now it is leading us lower. The USA I would assume is going to follow this index down, until the Chinese index turns around. NOW, this does not mean I expect us to lose 58%. But I wouldn’t think the January, March, and July lows are safe either. I have no pretty charts, I have no CANSLIM stocks setting up in proper bases, and I see absolutely NO new leadership outside medical. You tell me how we will have a bull market from that.

I have recently created a few videos that help show you this market compared to the REAL BOTTOMS of 2002 and 2003. Those that watch the video and listen closely and watch the follow up videos and study all those PAST BIG WINNERS that have such green charts it should become clear as day that our market is far from over from the pain that losses can inflict on one’s portfolio.

I still am hearing horror story of traders trying to trade this market. I am sick of saying it but STOP IT! STOP TRADING. CASH IS KING in a market where the Nasdaq has moved a WHOLE -0.03% from January 15, 2008 to August 18, 2008. How do you expect to make money going long or going short ANY amount of time frame in a market that is moving nowhere.

Some like to say “but Joshua, what if I shorted FNM or FRE.” Good for you! Go for it! I am a disciplined trader and I do not adapt my style that has worked for me since 1996 and super successfully since 1999. I lived through early 2002 to October 2002 and that was a very hard time to make money. But I have to admit the NON-ACTION in the market has made it the MOST DIFFICULT year for me. However, it has also been the most mentally rewarding because I have learned that I can recognize all market conditions and adapt accordingly without losing money.

I have lived through 1999, 2003, and 2004 and have made BIG MONEY during each year so I know how to act in market where I have to go all-in. But I recognize flat and dangerous markets and that is what we have RIGHT NOW. This could change now. Hopefully we can start a trend down. “But Joshua, why not up?” Because the charts are UGLY. You can NOT start an uptrend from this kind of setup.

I have posted three test videos with two on follow-through days and one on MPWR and how so many of you could have gone long such a ridiculous chart compared to a winner like XSI. There will be other videos that I will make comparing today’s “leading stocks” (which are not much of leaders at all) compared to how the “leading” stocks of 2002/2003 looked. I think subscribers will learn VERY FAST that bull market look COMPLETELY different than markets now.

Those that are telling you to buy the dips have a vested interest in the Wall Street crowd. I used to work for a website that only tollerated those that toed the Cramer line. I refuse to do that. I still believe he is harmful for the average individual investor and I want to personally thank everyone that reads this and that can see through the lies on CNBC and now exposed 8/10’s of the time on a site I once LOVED and worked for. Sad times we are living in. I have never seen so many “smart” people tell people to buy such clearly falling stocks. Bad medicine. But as long as they scratch someones back, someone is scratching theirs. I love Capitalism but it is crap like that that helped turn Capitalism into a greed chase. All everyone that subscribes seems to want to do is “MAKE MONEY NOW.”

Folks, now is not the time. I will ask you one more time. Where were you in 1999, 1003, 2004, 2005, 2006, or even early 2007? Now you want to trade stocks after the uptrend has come AND GONE? This is so like 2000. I just PRAY it is not anything like it.

Aloha and I will see all my subscribers in the chat room where hopefully we can make another video for you guys to enjoy! :) ALOHA!

Three Videos Are Up At BWT.COM For Subscribers Only…

August 18, 2008

…the first is a video about how ugly MPWR was and how I would never go long such a stock like that and how all of you that did go long confused me with your comments “but it was a nice chart.” LOL. Funny. It was NO WHERE NICE and this video will prove it by comparing it to a stock that is nice.

The second video is just a quick take on the current rally and the previous selloff and why this bear marker rally, that is now failing, will do just that: fail.

The third video is about the follow-through days of 2002 and 2003 and how STRONG THEY WERE compared to our weak rally now.

Click on Joshua Live! for the three videos.

Enjoy. I will be producing another one tonight that will compare this rally to the real rallies of 99, 02, 03, 04, 05, 06, and even how the 07 rally worked.

ALOHA!!!! I hope the videos are a nice feature for members with GOLD or PLATINUM status. Silver members do not receive the videos after the testing phase is done. In fact, I am not sure, the videos still might be available to everyone that reads this site. I am not sure. Give it a test. That is what it is all about. We know they work.

Fantasy Football Season is Upon Us, Can you take on the Big Wave Trading crew?

Here are the details:

Fantasy Football 2008

Click here

League ID: 418319
password: stocks

This is a great way to have a little friendly competition amongst Big Wave Traders. There are only 12 slots so if you are interested please sign up quickly!!! Plus with a relatively uninspiring Bear Market what better way to get your mind of stocks!!!

Best of luck, you'll need it.

Market Speculator

Friday, August 15, 2008

The Market Showed Its True Colors As The Day Went Along; I Don’t Care About The Weak Rally In The Nasdaq And SP 600 When The IBD Indexes Are Lagging S

August 16, 2008

I have made mention many times how I have produced some incredible returns in short, intermediate, and long-term time frames with some incredibly fantastic stocks. Sometimes they were perfect charts like in 1999, 2003, and 2004. Sometimes they were CANSLIM pure stocks like 1998, 2005, 2006, and 2007. But sometimes there is nothing to buy, even when a market rallies. This short rally on the SP 600 and Nasdaq has so many traders itching for action that it is becoming down right depressing.

The fact that so few can see the ugliness in the charts that they buy is disturbing and makes me wonder just exactly how many our learning from my past success instead of just piggy bagging off of some random idea.

Recently, I have had a rash of personal subscribers go long FUGLY charts like MPWR and MR. First off, I did not go long these stocks and I believe my PAST BIG WINNERS have proven that I know what to look for when it is time to get very long a certain stock. Second off, why did so many go long these two stocks. Were they really that nice? HECK NO. I have no clue how a newbie thinks because I have gone past that level. I went past that level when I started. I looked for answers myself that people meet me and just ask me. The bottom line it is simply amazing that we could have had five years of a bull market and NOBODY SHOWED UP yet this year, the year when the bull died, everyone shows up. This is the exact replay of 2000. And the facts show only 10-20% will be able to come out of this bear market with their accounts in tact.

Recently, I went long two stocks that made huge one day gains of 25% and 30%. I told some of those that bought them to take 25% to 33% off the table immediately because in this market everything fails. Those that did not listen has seen all their profits wiped away in one stock. I suggest taking profits in the other home run before the same thing happens. The facts are that this other stock has a higher chance of working out because the green in its charts came over a longer period and the stock is in the medical group increasing its chances for success.

However, unless you are professional you should not be investing anyways. But Joshua, IBD said that the market is in a “confirmed rally.” Well does a confirmed rally have the NYSE, DJIA, SP 500, and SSEC-x indexes trending under the 50 and 200 DMA? NO! All the indexes will be rallying. Not just the Nasdaq and SP 600. Anyways, to those that still DO NOT GET that a follow-through day does not guarantee a new bull market, can’t you tell something is wrong when breakouts soon fail like MR, MPWR, and OPTR. I can name about another 100 stocks that have broken out and failed recently. The fact that I did find that one gem out of 100 losers has some thinking that this is a bull. NO! The facts are that I can tell a beautiful chart in a strong sector from an ugly chart in a strong sector. While some were buying MR, I was going long that stock that recently just gave me a 65% gain in under two months and a big one day gain of 30% on a good buy. Did I load up on this stock? Of course not! This is not a bull market.

But Joshua what about the follow-through day? I will repeat this one more time, because obviously IBD has not said this enough for some of you: not every FTD launches a new bull market BUT NO BULL MARKET HAS EVER!!! STARTED WITHOUT A FOLLOW-THROUGH DAY. So just because the Nassy flashed one doesn’t mean that the whole market is ready to rock. Doesn’t it throw a HUGE RED FLAG that the IBD 85-85 and IBD 100 indexes are lagging so badly? I mean, folks, these are LEADING STOCKS. THAT MEANS THEY ARE SUPPOSED TO BE L E A D I N G! When leading stocks do not lead but instead lag and show that they are the weakest links in a weak market, you are supposed to be very long cash. That is why I keep saying CASH IS KING. Why? Because, in a market that has gone a whole .52% on the Nasdaq since January 11th, you are not supposed to be trading. The greatest traders of all time would be fully 100% in cash, so why aren’t you?

Even in small downtrends in 2005, 2006, 2007 (the start of November to January), I have proven that I can make a lot of money. But recently NONE of my shorts have worked. Why? There is no trend. At the same time almost none of my new longs are working. Why? Because there is no trend. There is no trend up or down and those of you that think you can trade the market the same way as you can a trending market using the CANSLIM system you are wrong. And if you think it is smart to drop a system that has produced the returns that you can see via my past big winners for a short-term oscillating market you need to realize that out of a system of 46 methodologies tracked by the AAII CANSLIM comes in the top three in overall returns since 1998 with a 1,500% return. The only two other methods beating the CANSLIM system are forms of the CANSLIM system with a touch of value investing thrown in. So the bottom line is that the way to make big money is to use the CANSLIM or a momentum type of system that has you going long leading stocks in a market trending up and have you go short the weakest fastest falling stocks in a bear. But when a market goes nowhere, don’t try to change your investing style. You will just end up making the losses worse.

Those that are not patient are going to get killed by this market as MPWR, MR, and OPTR’s will be lined all across the landscape until all the johny-come-latelys finally get exhausted and drop out. When these weak holders finally drop their stock into the strong holders hands the rally will come and most will not be long the right leading stocks. But those that subscribe to this site will not have to worry for I will be long the leaders and the best setups that exist when the tide turns. But for now you must remember unless your whole chart is loaded with green to max green BOP and strong accumulation there is no way you should make foolish breakout plays in a market that is not rewarding that type of action. Try a little bit of patience. It goes a long way in life.

Aloha and I will see you Monday where I will be doing my usual unbiased work on the market. During the weekend I plan on posting a few winners from 07, XCO from 08, and TZOO from 04. And know I did not get the whole move in TZOO like I did with TASR. But as you will see, just like TASR, TZOO clearly setup in a proper buy pattern that made it an easy choice to get long. When stocks are loaded with max green BOP, extremely strong accumulation, and have incredibly strong fundamental growth it doesn’t make it had to get real long…AS LONG AS THE TREND IS UP ON THE LONG, INTERMEDIATE, SUB-INTERMEDIATE, AND SHORT TERM TREND. Right now we are far from that. There is only ONE STOCK that I see setting up in a near-perfect to perfect pattern. In a good bull market I will see anywhere from 10-20 at once. So we are a long ways away. Patience young Jedi. Patience.

One more time, ALOHA!!!!

Thursday, August 14, 2008

XSI Home Run

August 14, 2008

Finally a stock that has done exactly what it is supposed to do. That makes two in a week: CRD.b and XSI.

Congrats to all that loaded up. I was going to LOAD UP on XSI and instead kept it a regular position. The gains are still very nice and sweet and even though I blame myself for not LOADING UP like I said I was in the chat room I am still happy with the gains. Congratulations to all subscribers that bought these very pretty charts. They were not perfect but they sure acted like they were. This is how all of our longs will act at the start of a new bull market. In 1999 and 2003 they all acted like CRD.b and XSI. This is how it used to always be. Right now, we got lucky, and the market was so crazy I couldn’t even LOAD UP. Still some big gains 25% and 30% by each stock in one day. That is how it will be when the trend turns up again in the indexes. I can’t wait till this becomes the norm. For now though I have to kick myself for not following my own advice and loading up on XSI. My excuse is that it was too thin and the market is acting like a psychotic prisoner. Congratulations to everyone who got these beauties!!!

Wednesday, August 13, 2008

China’s Shanghai Composite Index Is Hitting New 52-Week Lows, Our Nasdaq Is Failing At The 200 DMA, Our DJIA Is Failing At The 50 DMA, And Yet I Keep

August 13, 2008

I am not sure why so many of you are bullish and for sure that you are “missing out” on some of the new gains of a fresh new bull market but last time I checked we have amazing charts in good strong bull markets. We don’t normally see the amount of distribution that litters the charting landscape right now. Normally, many charts, if you have hit a bottom, will be rallying on strong volume, with green to max green BOP, and with nice tight price action signaling that the weak flippers have left the stock market.

I know some of you do not like to hear this but China has been the leading index for years now. There GDP trumps our GDP and they are the industrial powerhouse now. The fact their index has fallen so much since the November top should be all the news. But I don’t here much talk about it. Too bad because a lot of lesson can be learned here. The fact that we have only fell around 20% while China has fell over 55% it can be said Relative Strength wise we are doing much better. But it also tells of how speculative Chinese stocks got. You don’t fall almost 60% unless your market was in some sort of bubble. What lesson should we learn. Well, I am not sure how much longer we are going to fall but I want to point out something on the SSEC-X (on Telechart).

In December the Chinese market started a rally. I am sure many were for sure that was a bottom. Nope. THen in February stocks started inching higher. I heard many say then (but Market Speculator was saying that the top was in) that the bottom was in. Nope. It continued to selloff till the April bounce. That for sure was the bottom right? Wrong again, as price went nowhere for around a month and then fell out of bed again. In July we saw yet another start of a rally. I heard from some that now that the Olympics were here that the Chinese market has bottomed and now it was clear sailing as the Olympic games would reignite the vigor for Chinese stocks. Whoops. Here we are rolling over yet again, hitting fresh new 52-week lows with the market selling off 4.47% on Friday and then falling a whopping 5.21%. That sent it to new 52-week lows and once again burned the bottom callers.

This should just be yet another lesson to those who can’t help calling bottoms. Do you remember the psycho women who told me to buy banks in January. She gave me great stocks to hold for the long-term that were bargains like LEH. What sage advice. Glad I didn’t listen. Bottom callers will FOREVER continue to be burned. Until they learn that the proper way to speculate is to buy high and sell higher in a bull market and to keep your cash in the coffers while in a bear, they will NEVEr succeed.

Those that bottom call are an egostical bunch and history has proven their strategies are far riskier and lackluster compared to the CANSLIM system which has constantly been in the top 2 to 3 methodologies when it comes to performance ratings since 1998. This is out of over 46 different systems. So this is no small sample. The CANSLIM system in good markets will make you filthy rich when you learn how to use it correctly. In a bear market it will save you from financial ruin. In a bull market value/bottom callers will do well (if they are skilled like Martin Zweig who uses a bit of CANSLIM with his value investing) only if they are the best. Most will not be able to make the gains the momentum/CANSLIM investors can make in uptrending markets. Just review my “past big winners.” I posted a new one today.

You can see the clear pop in price, volume, BOP, Relative Strength, and Moneystream that make it an obvious long to take a lot in. That was only a 133% gain from buy to top but how many “bottom callers” are making these kind of returns. Study my “past big winners” in the bull markets of 99, 03, 04, 05, an 06 and tell me that buying banks in January was smarter than going completely to cash. By the way while she would have had me short LEH, JPM, and MER–which ALL would have BROKEN me (thanks Sandy/Wendy–great advice!!)–I was able to go long XCO, PDO, and DGLY. The stocks I went long went up 50%, 100%, and 50% making this bear market a manageable market to keep my accounts above water. Meanwhile her suggestions would have left me B R O K E!!! Buying falling stocks if for suckers. Only suckers buy stocks that are falling in price. Especially in a bear market.

Please, don’t be a wall street sucker. Be a BIG WAVE winner. Trust me the bottom callers don’t make you a fortune in bull markets. My CANSLIM/momentum methodology can and IT WILL to the winning investor that learns to play the game the right way. Rule one: Put the odds in your favor. Those of you buying stocks in a downtrending need to stop. This is a losing game and it is going to cost you big if this market cracks wide open like China.

I want a bull market badly but until APII and EMIS charts with all that max green BOP and green price bars litter my charting landscape in higher quality names I refuse to get bullish on this market. Be careful out there and remember until a real follow-through day on much higher volume with a huge price gain that takes all the indicies above the moving averages, I will not be able to get bullish on this market. Study EMIS and APII to learn what I want to see all over the place before I will begin to call a bottom. If you don’t have Telechart, you wil not be able to see the green to max green BOP. Therefore I posted them in my forums. If you are a gold subscriber you may go there to take a look.

Aloha and I will see you tomorrow around noon EST. ALOHA!!

Tuesday, August 12, 2008

90% Of You That Started Trading Last Year Or This Year WILL FAIL! These Are Facts! Not My Opinion!

August 12, 2008

[2008.08.12 07:14:01] JoshuaHayes: they need to leave
[2008.08.12 07:14:05] JoshuaHayes: they need to quit trading
[2008.08.12 07:14:08] JoshuaHayes: to be so f’g stupid
[2008.08.12 07:14:10] JoshuaHayes: to see that the market
[2008.08.12 07:14:13] JoshuaHayes: has moved NOWHEER
[2008.08.12 07:14:15] JoshuaHayes: since january
[2008.08.12 07:14:18] JoshuaHayes: there is NO TREND
[2008.08.12 07:14:20] JoshuaHayes: over 10%
[2008.08.12 07:14:22] JoshuaHayes: up or down
[2008.08.12 07:14:24] JoshuaHayes: i did give you
[2008.08.12 07:14:25] JoshuaHayes: DGLY
[2008.08.12 07:14:26] JoshuaHayes: and PDO
[2008.08.12 07:14:29] JoshuaHayes: PDO was clear!!!!!!
[2008.08.12 07:14:34] JoshuaHayes: and if you do a search right now
[2008.08.12 07:14:37] JoshuaHayes: and look in 2003
[2008.08.12 07:14:43] JoshuaHayes: there were over 1000 stocks up over 100%
[2008.08.12 07:14:48] JoshuaHayes: by 2006 there were only 400
[2008.08.12 07:14:52] JoshuaHayes: this year there isnt even 20
[2008.08.12 07:14:55] JoshuaHayes: so use your brain
[2008.08.12 07:14:59] JoshuaHayes: NOBODY is marking money
[2008.08.12 07:15:06] JoshuaHayes: i mean cant ppl see that every mutual fund is losing money
[2008.08.12 07:15:08] JoshuaHayes: i think most new traders
[2008.08.12 07:15:11] JoshuaHayes: are idiots
[2008.08.12 07:15:14] JoshuaHayes: they have no clue about history
[2008.08.12 07:15:17] JoshuaHayes: and dont get that
[2008.08.12 07:15:19] JoshuaHayes: in a CRAP MARKET
[2008.08.12 07:15:23] JoshuaHayes: you GET CRAP RETURNS
[2008.08.12 07:15:25] JoshuaHayes: CRAP MARKETS
[2008.08.12 07:15:27] JoshuaHayes: go nowhere
[2008.08.12 07:15:30] JoshuaHayes: this is not and up or down
[2008.08.12 07:15:35] JoshuaHayes: i have my past results
[2008.08.12 07:15:38] JoshuaHayes: NO ONE SHOULD ARGUE with me
[2008.08.12 07:15:44] JoshuaHayes: or think “i suck now”
[2008.08.12 07:15:52] JoshuaHayes: you would be a MASSIVE IDIOT
[2008.08.12 07:15:59] JoshuaHayes: to think that i have “lost” my touch
[2008.08.12 07:16:03] JoshuaHayes: the next big bull
[2008.08.12 07:16:06] JoshuaHayes: that most traders
[2008.08.12 07:16:07] JoshuaHayes: 90%
[2008.08.12 07:16:09] JoshuaHayes: will not be a part of
[2008.08.12 07:16:13] mghens: anyone that reads your suggested list cannot and would not think that
[2008.08.12 07:16:14] JoshuaHayes: they can come back
[2008.08.12 07:16:17] JoshuaHayes: and see the AMAZING
[2008.08.12 07:16:21] JoshuaHayes: growth stocks like APII could be
[2008.08.12 07:16:26] JoshuaHayes: right
[2008.08.12 07:16:27] JoshuaHayes: but theer is
[2008.08.12 07:16:37] JoshuaHayes: everyone needs to just stop trading
[2008.08.12 07:16:43] JoshuaHayes: if they do this to STJ and AMED
[2008.08.12 07:16:52] JoshuaHayes: why is anyone long??????????
[2008.08.12 07:16:57] JoshuaHayes: 85% cash myself
[2008.08.12 07:17:01] JoshuaHayes: 50 small longs
[2008.08.12 07:17:05] JoshuaHayes: NONE are HOT!!~!!!!!!
[2008.08.12 07:17:08] JoshuaHayes: NONE NOEN NONE
[2008.08.12 07:17:10] JoshuaHayes: APII EMIS USAK
[2008.08.12 07:17:22] JoshuaHayes: are the only three stocks that look like they are goign to setup in the right bull market patterns
[2008.08.12 07:17:24] JoshuaHayes: with the green BOP
[2008.08.12 07:17:30] JoshuaHayes: and they are months to maybe a year early
[2008.08.12 07:17:34] JoshuaHayes: it takes a lon gtiem
[2008.08.12 07:17:37] JoshuaHayes: where was everyone in
[2008.08.12 07:17:38] JoshuaHayes: 2003
[2008.08.12 07:17:39] JoshuaHayes: ?
[2008.08.12 07:17:41] JoshuaHayes: 2004?
[2008.08.12 07:17:43] JoshuaHayes: 2005?
[2008.08.12 07:17:45] JoshuaHayes: 2006?
[2008.08.12 07:17:50] JoshuaHayes: they shyow up at the top in 2007 of course
[2008.08.12 07:17:52] JoshuaHayes: :)
[2008.08.12 07:17:54] JoshuaHayes: LIKE ALWYS
[2008.08.12 07:17:59] JoshuaHayes: where was everyone in 21996?
[2008.08.12 07:18:01] JoshuaHayes: 1996?
[2008.08.12 07:18:03] JoshuaHayes: 1997?
[2008.08.12 07:18:04] JoshuaHayes: 1998?
[2008.08.12 07:18:08] JoshuaHayes: 1999?
[2008.08.12 07:18:11] JoshuaHayes: then in 2000 THEY SHOW UP
[2008.08.12 07:18:15] JoshuaHayes: EVERYHWERE right at the top
[2008.08.12 07:18:19] JoshuaHayes: HISTORY NEVER STOPS REPEATING

Those that are not patient will fail in this market. This market will make the newbie go insane. I suggest you get to my book list and start reading everything about Jesse Livermore, everything Boik wrote, and read the How To Make Money in Stocks by O’Neil. Only then will some of you get it. This market has only one goal: to knock out the newbies who JUST entered the market.

Monday, August 11, 2008

Nasty Intraday Action Continues To Remind Me To Be Careful With This Rally

August 11, 2008

Some people are all excited and think the worst is over, even though there has not been a single up day on the indexes where volume was clearly huge that it was obvious institutions were back at work. For those that don’t think that is a big deal, I assume you don’t like making any kind of decent return on any long. For those of you who love to daytrade, I guess it doesn’t matter.

Sadly, this matter to us longer-term Home Run hitters. We still don’t have anything to get too excited about. I have two new longs tonight that look great and on Friday I gave you a near perfect chart pattern that produced a one-day huge grand slam with a 27% return today. Now that is how all of my longs are supposed to act in a bull market. And that is just that, if this was a bull market I would still be long the full 100% of CRD.b, but instead I am selling 25% into the big 27% one-day price gain. That is the difference between a bull and a bear. In a bull, you don’t sell the pops. You hold so that you can hit some big winners (I posted another 11 this weekend from 2004-2006) that can help turn you into a millionaire from a thousandaire. However, in a bear market, you just sell the pops. Because, eventually things run into resistance and return back to where they came.

One item of key resistance came with the Nasdaq’s 200 day moving average which seemed to halt the indexes advance that it was having today. Around 2pm EST it looked like the market was on to another short-squeezing (due to the low volume that is how we know it is a squeeze and not real accumulation) big pop. But instead the indexes reversed off the highs and the DJIA even dipped into the red to really emphasize to those that think the coast is clear that the coast is not clear. This reversal leaves us with negative candlestick bar charts on all our index charts. That combined with the higher volume is not bullish. To add to the gains the put/call ratio fell to a complacent .75 signaling that those that saw the pullback were still bigger believers in the rally.

If you are a super-short-term trader nothing is wrong with being bullish here. But for those of us who have been around longer than one year and have studied the market going back to 1896 personally (have read books going back to 1880) you start to realize that you are dealing with just a bear market rally UNTIL YOU ARE NOT. How do you know when you are not in a bear market rally. You have powerful follow-through days up between 3 to 5% with volume 20-30% higher than the day before. But not only that you have HOT! HOT! HOT! CANSLIM quality longs setting up all around you with broad leadership.

Right now, we have none of that. The only leaders we have our medical stocks. Medical stocks are our leading stocks and though there is nothing wrong with that, medical stocks leading while stocks are being destroyed all around us does not equal a bull market. What does equal a bull market? Simple. I want to see internet, semiconductor, computer, software, retail, banks, and other technology related stocks moving higher. Not anything that has to be used all the time like food, medical, and commercial services. I want real leadership.

You only get that in real bull markets and you only get real bull markets when the public gives up. With a VIX at 20 and a put/call at .75, you can be sure the public has not given up. I personally, after being a part of the bull market from 2003-2007 believe it will take a LONG TIME to knock out all the late “I wanna be a traders.” These newbies (about 90%) will have to give up from this difficult market before charts of late 2002 to late 2004 come back. How do I know too many newbies are around?

I have nothing but past big winners literring my website for those people interested in learning how to invest the right way to learn. However, even when stocks like ANTP in 2004 go up 300% in under a month some people ask me “is it too late to get long now and have I missed the rally.” This just shocks me that I have so many stocks up over 300% in late 2003, stocks up over 200% in 2004, and a couple of stocks move up over 500% in 2005 (BOOM and ERS) and yet people still ask me “that they think it is too late and they have missed most of the gains.” Well in a bear market, probably. But that is not why you are here. You are here to WAIT for the pefect chart pattern and then ATTACK. No matter what year it is in. Most of the best stock chart patterns come MONTHS AFTER markets make thier lows during a downtrend. Most of the greatest stocks of all time did not come on the day of the FTD (some did). Most came within the first month but still a TON (JUST BY REVIEWING MY SITE YOU CAN SEE THE PROOF FOR YOURSELF!!!) come months and months and even years after the FTD bottom.

Only those inexperienced or just plane ignorant of the market would make these kind of statements. However, I keep seeing them. So that with the fact that they are all looking for a bottom proves to me we are not yet at a bottom. I PRAY I AM WRONG AND THAT HOT! HOT! HOT! charts continue to form and that possibly if the market can get its act together, yet at the same time scare the public, we can have a LOT of base on base patterns. However, this remains to be seen. I personally think too many new investors are bullish and are looking for a bottom. As long as people are looking for a bottom there will be no bottom.

However, there are sure to be rallies to make money on the long side in this longer-term bear market that we are more-than-likely in. We already had PDO, DGLY, CRD.b, and XCO this year. They were not great. But they still made us enough money to make up for all the other mistakes made this year. It does NOT get any harder than this. Since January the market has not moved very far and that is obvious in all my accounts as they range from down 7% (was 4% until OFI) to up 9% (thanks to CRD.b). This is the worst market I have ever been a part of and before I make another huge move in the market the chart must be perfect and the trend must be up.

I ask you. Is the NYSE above the 50 or 200 day moving average? No!. Is the Nasdaq above the 200 DMA? No! Did the Nassy take the 50 DMA on the FTD? No! Did the SP600 retake the 50 and 200 DMA on strong volume in a nice round base? No! Are there more than a handful of HOT! charts setting up? No! Then why are we trying to call a bottom here?

CASH IS KING, even when a few stocks are moving up. I don’t play for nickles. I play for the big money. The big money can not be made right now. Be very careful out there and wait for more charts like APII to setup (if you don’t have Telechart you can see the stock in the forums by searching for APII). If you are not a subscriber to this site or to Telechart, what is wrong with you? Don’t you want to be the best? When I see APII charts setting up everywhere and see max green BOP dominate charts during the past three to six months, then I will get as bullish as all the newbies who are having “moments of grandeur” over a very weak 10% bounce. They seriously don’t come much worse than this. There are simply too few nice charts out there. When I see a lot more, you will notice a HUGE change in my writing.

For now it is all defense until EMIS, USAK, and APII charts start setting up all over the place in stocks that trade OVER $10 and OVER 100,000 shares a day. Until then, CASH IS KING! ALOHA!!!

Sunday, August 10, 2008

Big Drop In Oil And A Big Rise In The Dollar Ignites Another Bear Rally.

August 10, 2008

How do we know it is a bear rally? Easy. Volume. Volume would not be heavy on the selloffs and light on the rebounds like it has been if this was real institutional investors. Besides that I ask you, if you were a bank or a mutual fund, would you be buying stocks knowing what kind of macro environment we are coming upon? I would think not.

The biggest surprise to Friday’s trading is the complete reversal of action from Thursday. After Thursday ran right into the 50 and 200 DMA resistance points on various indexes, it sure seemed like the trend was ready to push lower. But just when the market looks like it wants to breakdown, it breaks upwards. That is what markets due in bear markets. They do this to throw the shorts off. They make the longs and bears look bad until eventually both give up (like I have done a while ago). This is the right thing for the market to do. But the problem belongs with traders. Most will get frustrated and leave the game behind. The smart traders watch this up and down dance and wait for the big volume of the institutions to return. My bet is that when they do return they will return as sellers.

If you don’t think I have a list of stocks I want to get short that I was not able to get short or make big profits of from November to January, you are wrong. I am loaded with names of ag, oil, big-cap tech, and other gold/metal/mining related stocks that have been in bull markets anywhere from 2000 to 2003 all the way till this year. I am sorry but 5 to 8 years of price gains is a bit too much for me. Especially, that now I am finally starting to see excessive splits within some of these stocks in the chemical arena. However, at the same time I see some without and not too many are excessive so I don’t want to get too excited just yet.

But the facts remain that the outlook is for our GDP to come in the negative territory the upcoming quarter. The market is a forward looking beast and a weak ecomonomy should mean weak upcoming earnings and that should mean more estimates will be taken down which only mean one thing for a stock when that happens. Kaboom and goodnight. More stocks are seeing the dark nights of Hell instead of the bright lights of Heaven, no matter if they announce great, good, even, poor, or really bad earnings. The same thing seems to be happening anyways. Lower stock prices.

This kind of tape action (there really is no tape action since January) has left me twiddling my thumbs searching hard for something that could setup for either a bullish tape move or a bearish tape move. Those that have my forums have my “pretty charts,” “nasty charts,” “toppy charts,” and “possible future longs” sections to study from to learn what is topping out and what is setting up for a potential nice long or a potential nice short. Right now, it seriously, is pretty messy.

I do have one stock that I do put up on my computer screen on zoom 4 to help me sleep well at night. That stock is APII. If we are going to have an upcomig raging bull market a lot of stocks will start to look like that but will either pullback or flat base out on max green to green BOP, low volume on pullbacks, heavy volume on moves higher, and then will breakout with the max green BOP still in full effect. Just study those past big winners to see the truth. History always repeats itself and it will not be any different this time.

That is why you are not seeing me excited about this stupid “follow-through day” everyone keeps talking about. If some of you would take the time to study your 2002 market and your 2004 market which are your two most recent real FTD’s from severe bear markets you will notice some things existed then that do NOT exist now.

Back in 2002 from August through September through most of October the stock market sold off on VERY light volume. It wasn’t till the November volume that some action started happening. That action turned into a 4.42% up day as day 1 of the rally attempt was now on. Day two followed immediately with another 4% advance. Day three was an up day but it wasn’t much and volume was light which was then followed by day four (the BEST FTD’s come on day four–notice this one comes on day four) with the market jumping an incredible 5.1%. That took the index above the 50 DMA with a 5% move on the FTD. Those ignorant of the market BITCHED and BITCHED that they “missed all the gains.” Boo hoo. We missed them all. What these fools failed to know via their history is that this time SINA SOHU NTES USNA SSYS GRMN and a few others were setting up, breaking out, and looking great with max green BOP, huge volume and great price action charts. But the amateurs did nothing but complain.

The rally was looking good until about January when some stocks started to selloff with a few nasty days. But the key to all of this was that, once again, volume was below average on the down days signaling that institutions had no interest in selling. By this time, not only were the stocks just mentioned already putting on a beautiful display of green talent, now about 20-30 other stocks were setting up in bases that were long and flat and quiet and loaded with green to max green BOP. This then helped lead to 3-12-03 where the market had a nice little up day. Nothing to throw a party over. But the next day another huge rally hit the market with a 4.8% gain on volume at least 20% higher than the day before’s already heavier volume. This was now starting to look real good.

Day three was about as quiet as you could get on 3-14-03 as the market traded in an EXTREMELY TIGHT RANGE GOING NOWHERE for a -0.03% day. Then came day four. Day four is supposed to be the day you want to see a FTD if you have already had day one and day two under your belt. Well day four came and we got what we wanted. Not only was 3-17-03 a great follow-through day with a 3.88% rise on the Nasdaq, a 3% rise on the SP 600, and a 3.1% rise on the NYSE, but volume was once again around 25% higher than the day before which was once again a heavier volume day. By this time beautiful CANSLIM and max green BOP quality charts were setting up and some were breaking out all over the scans. The only difference between this rally and the 2002 rally. This time no one was around. The other difference. This FTD came with the Nasdaq retaking the 50 AND! 200 day moving average. It is incredible to have a FTD on such a strong move that it takes you over the 50 DMA but with it also taking us over the 200 DMA and with SSYS, GRMN, USNA, CRDN, SINA, SOHU, SINA, and HIL already being very heavy holdings in my portfolio it was clear something was different this time. Just thinking of HIL and how much money HIL made me makes me very happy right now (HIL is now HILL).

Until we have a market like this that has me feeling good like that one did, you can bet that I will have to suffer each and every day in a rough market just like you. This market is not any easier for a professional than it is a completely ignorant newbie (ignorant of the facts). I need a trend, either up or down (I can make big money in shorts to; just in November to January 50% gains were made in GRMN SGMS SIGM and CBEY) and right now there is not a single trend. So until there is a trend, I will be doing my best to help you understand how to make the most money possible when there is a trend. Be patient, REFUSE to let this market wear on you, and do NOT be the 90% that give up. YOU CAN DO IT!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! I KNOW YOU CAN!!!!!

I Just Posted 10 More Past Big Winners. PLEASE STUDY THE CHART PATTERNS!

Until I see these chart patterns again, there is NOTHING FOR ME TO DO!!!!!!! I don't trade for pennies. I like to make 300% in one month. I don't then switch to daytrading during times like this because when it is time to go real big again you will have a warped sense when to sell and you will not have a SINGLE ONE of my 1999, 2003, 2004, 2005, or 2006 winners.

If you look at all my BEAUTIFUL MAX GREEN BOP charts and see those AMAZING gains produced via these incredible charts (which most of them were also CANSLIM quality stocks) and still think there is a better way well man....God bless you. Keep buying support and resistance. My methodology is proven to be of superior quality. This is why I have studied the greatest traders. So I can have stocks like this line-up my list of personal holdings.

Some of you need to go to 1999 and 2003 especially and memorize EVERY single one of those beautiful chart patterns. That way when this bear is over and a bull is ready THERE IS NO WAY YOU WILL OR COULD BE CAUGHT OFF GUARD. Those that make it through this--which will be only 10% of those that have opened and account within the past three years--will enjoy the next bull market unlike those that gave up. Most will give up. Are you?

I will be back later with a little look at our pathetic bounce that so many seem to think IS "the bottom." Amazing. This is an olympics, oil drops, dollar rallies kind of rally. This is not an institutional investor led rally. Short covering baby. This is what short squeezing looks like. Not real accumulation. If this was the bottom, people would be saying that stocks were going to continue to crash for sure. I see the VIX, I see the put/call ratio, I hear the talking douche-bags on TV. It isn't right for this to be a bottom. Everything is wrong. Bottom line, for this to be a volume, we are going to need to see a 3% to 5% up day on the Nasdaq where volume is 25% or higher than the day before, before I will believe this is a bottom. After I see that then I am sure I will find some of these.

There will be one more post before the market open. Aloha! For those reading this on another web site, please visit my website go to the longs drop down and select "past big winners." There you can go into any year and see MY personal BEST big winners. To make the list they all have to have been larger positions when I went long. Small longs and complete ugly charts that did well are not listed. Another option on the past big winners page is to look on the right side of the column and from there you can go to the actual year that you want to go to to see my big winners.

In this market environment you are either learning or you are losing money!

Saturday, August 09, 2008

Longs Analys Detailed With Some Important Stock Market Information

August 10, 2008

For subscribers to the site, we are back online, after a NJ transformer exploded and knocked out 1,000 of website. We were one. Anyways, for those of you waiting for commentary, I have already updated the shorts and longs section–making the longs section very detailed about each stock and the overall condition of the current bear bounce. So if you need to whet your lips with some heavy “dope” about this market feel free to go to the longs page and get some knowledge.

For the freeloaders, I will be updating the site this weekend. It has been a busy weekend but the bottom line is you 1,2, and 3 year old ROOKIES/NEWBIES/FOOLS/COCKY CRANKY PEOPLE whatever you want to be called need to stop thinking you are tough shit. 90% of you will fail. So stop acting like you know it all in this market. The best traders ARE NOT DOING ANYTHING RIGHT NOW. Until you can figure out why the Home Run hitters aren’t swinging for pitches after all the data and reasons I have posted here the past three weeks there is not much else I can do to help your greedy behind.

What have you done for me last week? Nothing. What did I do for you in 1996, 1997, 1998, 1999, 2000, 2001, late 2002, 2003, 2004, 2005, 2006, early 2007, and with two stock in 2008. I MADE YOU FILTHY RICH. It is NOT my fault you are deciding to enter the market now in a bear market. That is your problem not mine. Where were you in 2003? Where were you in 2004? Study my past big winners and tell me if you want to make money like that or if you want to daytrade yourself to the poor house.

The ball is in your court. I have already won the game. Now I play for fun. I have turned an initial stake of $20,000 in NYC and Maui to a VERY LARGE six figure account (and that was while suffering emotional problems that took me down a wrong path of girls, booze, and drugs; the stock market made it all for me back) that has allowed me to open 4 separate accounts including an IRA. Why newbies with NO EXPERIENCE still try to “debate” me is FOOLISH. Just stop it and learn. Learn from some one who has PROVEN IN REAL TIME THAT HE IS SUCCESSFUL. I hide nothing. I show all my buys and show you all my sales!!!! What more do you want? My blood? Think about it.

Stay positive, don’t give up on the market and become a flipper/daytrader, know that this CANSLIM sytle will work for those that take the EFFORT to learn it. Lazy people will ALWAYS fail. LAZY PEOPLE do not do well with the CANSLIM system. Don’t be lazy it can reward you greatly. Do you really think I thought I could afford 10 years in Hawaii? HELL NO. Only one thing made it possible: proftis from the raging bullish stock market in 99, 03, 04, 05, and 06. 00, 01, 07, and 08 were OK. But early 02 and most of 08 is HORRIBLE. It isn’t my fault. It is the market’s fault. It will change. My question is will you? This is NOT rocket science! Keep it simple my friends. I don’t like seeing anyone fail but I have a few I am severly worried about (I am looking at you Yoni).

OK I will be back on Sunday before Monday with another update on this bear market. ALOHA!!

PS: Haven’t any of you studied the INDEPENDANT AAII analysis on the top 60 investment strategies? IBD ranks 3rd out of 60. The other top two are the EXACT SAME THING (a form of CANSLIM) but they implement more value metrics. This tracking has been going on since 1998. Here are a few links. Here is one. Here is another RECENT tidbit: ABOUT INVESTOR’S BUSINESS DAILY (IBD)

Investor’s Business Daily is a leading financial news and research organization recognized for proprietary stock screens, comparative performance ratings and a record of identifying stock leaders as they emerge. IBD’s companion website,, offers stock tools and research for investors of every level. These include the IBD Learning Center, intraday reports on market action and the IBD StockCheckup(R). IBD hosts popular investment workshops and provides Home Study programs based on The CAN SLIM(R) Investing System. The newspaper was founded April 9, 1984 by William J. O’Neil, who originated the investing system that has outperformed major market indexes(a) for years. (a)The American Association of Individual Investors’ independent “real time” study found IBD’s CAN SLIM investing achieved +1521.7% vs. S&P 500 +54.92% for the past ten years (1998 through December 31, 2007, AAII Stock Screen). (C) 2008 Investor’s Business Daily, Inc., Investor’s Business Daily, IBD, CAN SLIM and corresponding logos are owned by Data Analysis, Inc., an affiliate of Investor’s Business Daily.


Finally, the company in NJ is back online. Thank you for your patience. That was a first. I am off to run errands before fully updating the site. Aloha.

BWT.COM and BWT.NET update

The sites are still down after a transformer blew in NJ where our host is. They are working to repair it but there is still a link to get in the chat room if you have the direct link. If you do not email with your login information and he will help you

So if you are having trouble reaching or, you can find us in the chat room as they are on the west coast and not affected by the transformer explosion in NJ.

Thank you for your patience!

Thursday, August 07, 2008

The 50 Day Moving Average Proves To Be Strong Resistance; For A Real Bottom To Happen The Public Has To Give Up–We Are No Where Near That Yet

August 7, 2008

I am extremely busy right now and will expand on this later but like I have said many times before: the most successful rallies come when the Follow-Through Day comes with a move well over 3% and takes the prices over the 50 DMA. When you don’t get that on a FTD day you normally only have a bear market rally.

A lot of people are wondering why it is so hard to make money out there. Well folks just taking a look at your charts tells you why. Since January 29, 2008 till today 8/7/2008 (I think I was on a two-day chart when I posted these figures in the longs/shorts analysis–subscribers will see the small variation) the market has moved a WHOLE NEGATIVE .10 PERCENT. I hate to tell people who love to make money this but without a real trend it is OBVIOUSLY impossible to make money in the market.

For six-and-a-half months the market has moved nowhere and without a market moving more than 10% up or down it becomes impossible for trend followers to make big money. That is why since the big gap lower on 1/22 I have made absolutely ZERO for income. A job that has always provided me with income (minus the Jan 02-September 02 period) is right now making me its little you know what. For this to change one simple thing has to happen and it is very simple. A trend has to start.

I don’t care if this trend is up or down but the fact is that it must move at least more than 5%. Or else none of your stocks will have enough time to make anything since 3 out of 4 stocks follow the trend of the market the fact is that most stocks are going nowhere with the market. If they are going up or down they are giving horrible and poor price entries. So those of you that think that I should be killing the market right now are completely inexperienced and HAVE NO CLUE how the real market works. You need a trend to make money. Those that are making money now are going to make a LOT LESS in either a bull or bear market. This is a churning market. Just look at the market since 1/22. IT SIMPLE HAS GONE NOWHERE ALLOWING NO ONE TO MAKE MONEY.

I have my records of 1999-2008 available. Even this year we nailed three nice stocks in XCO, DGLY, and PDO. Even if BKE, BRKR, ACM, AEHR, and a few other failed. This continued the trend of late 2007 when only one perfect chart worked: APPY. Earlier in the year in 2007 we had AFSI and TESO as clear winners. These charts simply don’t exist anymore. If you want to look at the ONLY two pretty charts just now starting to setup you can look at EMIS and APII. Too bad they are too thin. If you have your TCNET setting the same as mine you can see how pretty APII and EMIS are. APII is the clear King in this joint but it is too thin and too young to be considered a long. There needs to be at least 5 more weeks before it can even be considered for a base. Things simply do not look good out there.

There is nothing else to add here that I have not already said. I am going from 25% invested to 10% invested OVER NIGHT! I really have no faith in this market and what it did to two of my prettiest stocks today (OFI and VRUS) proves to me the market is psychotic and that no rational person needs to have money on the line. There are so many times when the market is easier like 2003-2006 and 1999. There is no reason to work your butt off for nothing. Which is what everyone is doing right now. I think some of you need to relax, realize another bull will come, but first we need to see some real blood and “give-up” on the street before we can have REAL stocks (those that trade over $10 and over 100,000 shares a day) setup in the same pattern APII is in. When I see 10-100 APII’s setting up, then I know going 1000% on margin is here. Until that day, STAY OFF MARGIN and keep all your plays small, long and short.

Hopefully, we can top here and selloff 20%. That would give us at least a good amount of time to make money on shorts before catching another bounce which is probably all it will be for a long time. I think we have a while before my pretty green charts or CANSLIM stocks work again. Those of you who continue to try to go long in this market have still not had something bad happen to them.

Look at MR for God’s sake. This stock was THE ONLY stock coming up on all my fundamental and technical scans. I passed on it due to its rough chart which shows heavy volume selloff in March below the 200 DMA with red BOP and false breakouts in June. Before that it false broke out in October and December of 2007. So trusting the breakout yesterday was the furthest thing away from my mind.

The reaction today on the volume that was HUGE and trumped yesterday’s proves NOT EVEN MEDICAL stocks are safe here. One place is safe: CASH. CASH IS KING!!!! I have been saying that a LONG TIME and have been right the entire time.

I nailed the market top, rode the uptrend the WHOLE WAY FROM 2002, and have told you to be in cash for the past four to five months. Yet, people still will not FULLY listen to me when I tell them to wait. Impatience will kill you in this kind of a stock market. Exercise discipline, be patient, and wait to pick up the cash in the corner of a room when it is just laying there. These kind of markets lead to 2003 type of bull markets. It just takes time. Be patient, keep your head high, and your cash dry. ALOHA!!!!

Wednesday, August 06, 2008

Another Big Up Day But The Volume Is Lame, Medical Is Leading, And Innovative Tech Is Being Destroyed

August 6, 2008

Tech and bank stocks continue to receive no love, while the commodity stocks continue to top. The rotation, to me, is clearly going into medical and food stocks. I have listed a ton of stocks to be looking to get long and have gone long enough medical stocks that we have enough candidates to watch for possible buy points.

However, this doesn’t mean you have to trade. If some of you have not learned from “How to Make Money in Stock” or “Reminiscences of a Stock Operator” that there are times to be long, times to be short, and times to stay away, like now, then I don’t know what to tell you. I am still getting too many questions about stocks from people that are clueless that they are fighting a major freaking battle. No FTD has ever succeeded for a real bull market rally that sent stocks up 1000% of points that did not see the FTD bust through the 50 DMA and the best take both the 50 and 200 DMA out. So the fact that our FTD was so weak and that we took the 50 DMA today on the Nassy is still extremely weak. It is almost like watching an identical rally of January 2001 or the late September 2001 rally. No matter what I am not buying what I see.

I have taken some nice medical longs. But even in this market, the medical stocks, are not setting up in perfect patterns. I am not used to seeing so few and so lame max green chart stocks. This is turning out to be one severe bear market. Despite the few stocks that are moving higher, so many seem to ignore the NCR, NICE, ENS, and PCLN’s out there. Investing in this kind of market is silly and not my cup of tea.

I am trying to save so many of you by keeping you in cash and getting you long medical leaders (like MR and VAR) so that we can make a little bit of money. But with the market in a downtrend from the November highs, the odds are still against me. I don’t like anything 50% or lower. Right now, you have about a 33% of your stock working. Even ex-great looking longs have failed this year and great looking CANSLIM longs have failed. While this medical rally gets going I will enjoy the gains I can grab in there, while forgetting the short side until it becomes easier. Neither longs nor shorts are making money and that is what you get in a market that has gone NOWHERE from 4/4/08 to 8/6/08 (I am sorry the Nassy is up .31% during that time). If this doesn’t make it clear that the past three months have been impossible for longs or shorts to make EASY money NOTHING will convince how to trade right.

The best investment, like Rev said today, confirming what I said yesterday, is to wait for an explosion where a well known financial, bank, or mortgage company dives 50% or more and playing the bounce. Reversing the breakout in gold, oil, and agriculture was also a great countertrend play. However, with these selloffs I would stick to a 60-minute chart to get the longs at the exact moment when the bears are washed out and the bulls can take control. Overall, this market is too difficult for trend trading. And trend trading is what I do best and what I have made a career out of. So for now, I wait. I know a lot don’t like it but I am sure many of you reading this have lost money trying to play this market recently. So I hope I can convince you to stop and slow down and maybe only using 25% of your money to go long for now. Eventually a trend up or down will develop again but for now as you can see via the four months of the market going NOWHERE. Wait for a trend, if you are trend follower, it will come again. Aloha and I will see you in the chat room where the madness is made clear.

Monday, August 04, 2008

Another Selloff Hits The Market With Volume Well Below Average But Doing Just As Much Damage As Heavy Volume Would

The stock market indexes all continue to trend below the 50 day moving average with the 200 day moving average trailing right behind it. This is the most bearish possible scenario for the indexes to be in and looking to go long stocks with the indexes setup like this is just asking for trouble. However, the worst possible other factor is finally being relieved. I was not making money in my shorts recently with the market in this negative position but now my shorts are doing well and even the shorts that I lost due to reversals that were unexpected are doing very well.

This just goes back to underline how important it is to have guts. If the stock is breaking down on huge volume, with the indexes in clear downtrends, it makes sense that as long as the stock is within 20% of its old highs as long as the pattern is right then it makes sense to get short. I will be looking to get short as many mining, oil, metal, ag, and other stocks that have been rising since 2001 that are starting to show topping patterns.

Some of the most recent interesting stocks that appear to be topping since the oil stocks destruction has been the chemical stocks. Today the stocks TRA, MOS, POT, SQM, CLF, and AGU are all giving clear major topping and reversal signals. These charts have appeared to be topping before, especially TNH. However, TNH definitely looks to be rolling over now and if volume picks back up then I am sure this stock is dead. The problem is that unless these stocks give me a low volume pullback to the 50 DMA followed by another move through both the 50 and 200 on strong volume, I am sure I will be getting short quite a few of the old chemical leaders.

No matter how these play out unless this turns into another secular long term bearish market I will just be waiting patiently heavily in cash while making the proper trades in select longs (like medical and food stocks right now) and short the right stock that are ready to rollover and breakdown like a certain shipping stock i shorted today for a huge gain in one day. Also there have been some great very green medical longs that have produced 8% gains in one day. So it is just about being a really good stock picker. There are not going to be a lot of people that make it out of this tough market in tact. I am sure I will be just fine.

The only thing that continues to shock me is not that fact that none of the max green BOP charts are showing up. Even in other bear market there were some bullish sectors that had some nice charts with max green BOP and heavy volume accumulation. Stocks like GNSS were big winners in a bear market rally and hopefully we can get one of these soon.

Right now most stocks are breaking down and I know I keep saying the same thing but I have to make sure that we all have as much money as possible to use when the market is ready to go back into the 2003 mode that left us with so many stocks up 100% to 1000% with green to max green BOP charts that it moved into 2004 stick with CANSLIM stocsk. Remember, IST, AAPL, GPIC were all HUGE winners in 2004 which then led into 2005 with BOOM and ERS. That is when the HUGE gains stopped. The next big winners ranged from HRZ to PDO. They were not the same kind of power and they were not as easy to find and as “for sure” of a selection. But God knows that if we handled 2007 and 2008 so well that when the next bull market comes I am going to do the same thing to it that I did to 1999 with CMRC, JDSU, QCOM, LMLP, PARD, CAMP, NEWP, and so many others and 2003 when TASR, USNA, LCAV, EGHT, HIL, FMDAY, and so many other max green BOP beauties made me a small fortune. This time I will not party it away. Discipline now effects my whole life. We need more stocks to show up like EMIS, OFI, and VRUS in CANSLIM quality stocks before I get too excited. For now, cash is king, be careful out there, and I know I keep saying this but do not go long unless the chart is perfect.

A perfect uptrending bull market will come again and it will be easy to make money on the long side again. Right now is not that time. Please, be patient IT WILL PAY OFF!!! Aloha and I will see you in the chat room.

Saturday, August 02, 2008

Ugly Open Reverses With A Strong And Choppy Intraday Session; Stocks Still Close Lower Despite The Intraday Rally

August 2, 2008

Even though inedexes closed down .5%, they really did not go very far but they did do it in a very choppy motion. So unless you like turbo trading support and resistance for peanuts then there really is not a whole lot to do. I do understand that some people love daytrading and love to spend all day trading. Well if you enjoyed Friday then you are for sure a diehard market fan. It simply is not the way I want to spend my time. Now rewind back to 1999. I was making a TON of money HOLDING stocks. Not daytrading. But if I was bored had access cash and did not have perfect stocks to invest I could and would daytrade. I have to admit it was not as much fun as I did not get to see my pretty max green BOP charts and I did not like the feeling my heart had when I had multiple positions on. But if that is what you like doing then enjoy daytrading.

Right now, I think trading to the downside is the right game but as it is clear the markets are trending below the 50 and 200 day moving average. I tell you what, if some of you are impatient and can not stand having on longs (even if the chat is ugly; why???) all you need to do is go out and have fun until you at least see the price bars above the 50 day moving average. Once you see that you know that in the short term prices are moving higher. Then you can go in and look for max green BOP beauties like my XSI long that I have on. It isn’t perfect but nothing is in this market. I just want you to study all the green all over that chart and notice the perfect bounce/breakout on volume in late June. If you still don’t see these after the 50 DMA is taken then sooner or later you will once the indexes prices on the averages cross back above the 200 DMA. Once the indexes are above the 50 and 200 DMA there will be a few green filled BOP charts (hopefully) for us to enjoy.

If not there will be at least some CANSLIM quality longs that will show up in our new leading industry groups that will produce some huge returns. Trust me when this market turns I will be in the leading stocks in the new leading industries with the perfect CANSLIM stocks. If the chart is loaded with max green and breaking out of a perfect pattern or the stock is a perfect CANSLIM quality long breaking out of a solid pattern we will be long and ready to make a lot of money.

I know a lot of people are sick of waiting this market out but that has to be done or else you looked like all those idiots that were yelling at me in January that the market bottomed an that buying bank stocks had to be done. Well some told me to load up on JPM, some told me to load up on GS (that wasn’t that bad of a pick), but some told me I was an idiot for not buying MER. Well thankfully I saved myself I think a 50% loss. But I do want to explain how I look for potential bottoms. First off I love to see sentiment like it is now. I think the put/call has backed back off which shows that we are bit too complacent which is not good. Before we were a bit fearful as the put/call hit numbers like 1.3 on the most recent low which was real bearish. That showed the dumb money was definitely buying puts which is bullish long term.

On top of that, the bears in the investors intelligence survey were just hitting 50%. That is the first time in five years that 1/2 of the newsletter writers were bearish. That goes along with the weak week before that showed only 27% bullish which was also a five-year low. These are some extreme numbers. The only thing that would have been better was a put/call ratio around 2.0 as the 1.3 reading while high was still below the 1.4 levels in March. Still it was bearish out there.

However, there is one stock in particular that I am watching to help tell me if we have put in a tradeable low. My first clue that we have one is that my two most recent near-perfect charts have hit me with immediate advances one lasting 15 trading sessions and one lasting one month. And one stock that had a HUGE bullish intraday reversal on the largest volume ever after many years is my bullish tell. I will need all three stocks to continue to work in fashion for me to believe that my baby rally with a weak market can last. It is just nice to know you that we can make some gains after such a long time of ugly action. DGLY and PDO were godsends while BRKR, BKE, BCO, and AEHR were typical of a market near the end of a bullish trend. I personally hope the worst is over but something deep down tells me “yeah right big boy.”

Some of the reasons I don’t believe we are at a real bottom is just because I hear too many people talking about how they would like this to be the bottom. That is not the usual “I give up” repsonse by most market players that I nomrally hear at bottoms. But I have to admit I only briefly catch stuff from CNBC, the free chat rooms, and random comments at But just those few visits tells me a lot about a market and even though many are VERY BEAISH on this market a lot are still “believing” in a bottom. Normally for there to be a real bottom people have to completely give up. I don’t feel like people have completely given up. I know that the fact that I see some hot chats working indicate to me that the market could be at a bottom. But if I don’t get much more from my two longs that are near-prefect and instead the gains end abruptly, like DGLY and PDO, I will be upset and sad and ready for more losses before we can get gains.

Trust me, my hot chart will come back, just like they have in all bull markets. But trust me that patience and finding other hobbies is necessary in markets like this. If you spend every day waiting for a TASR or FMDAY of 2003 to come along, you will wear yourself out and blow yourself out via boredom and burnout. Poor market conditions throw up too many ugly charts and unless you love shorting America and the market it is very possible that you will burn yourself out and by the time the end of a 2002 to 2003 market comes, you will be long gone and miss the beauties like USNA and EPIC. Both were beautiful and perfect and both were missed by 90% of investors who failed during the 2000-2002 market fallout.

Why did I survive and why will I survive this bear market and the next? I love this game!!! You must love this game if you are to make money. If you get involved in the stock market to make money, you can do it but it sure is not easy. My love of this market is the reason I am holding cash saving myself from financial ruin like so many others while being long a few stocks that are moving higher despite the falling market. I love this game and my love for this game ensures that you could make money if you too love this game. I promise you one thing. In my hands, you are very safe. Just study all my past big winners from 1999-2008, notice how similar they are, and remember I will find these and make a lot of money in the next market environment that rewards me for finding these kind of charts. I can’t wait. I hope you are excited as me. In fact, I hope you are more ecited than me. Some of you are but some of you are impatient. Thank God you were not around during 2000-2002, you never would have received SINA, SOHU, GRMN, SSYS, USNA, HIL, FMDAY, TASR, EPIC, EVOL, MOBE, or even IST, AAPL in 2004. Life was good then and life will be good again shortly.

It is very rough right now but without these moments, I would not have the moments like 1999 and 2003 that I use to make a career. Anyone can get lucky for a year, but can you beat the market year in and year out? Not only that when you have the chance to destroy the market do you? You must not beat the market every year but in the few years when the market is up 10% to 50% you need to beat the market by double to triple the returns. Once you get in a real bull market and the market gives you the max green BOP charts with top CANSLIM ratings you need to KILL the market. If you can do that while just beating the market in years like this you will make a fortune by the time you retire.

Those of you that read this site to get rich quick, you better pray I find another MAMA in December of 2006 or a BFUN in 2003. MAMA was a 230% gain in 11 days and BFUN was a 250% gain in 10 days. That doesn’t happen too often and both were max green BOP and huge accumulation charts that I went long for quick huge gains. They didn’t last long but I recognized it was beauty over CANSLIM quality and they were very fun. However, the chances of finding them again in this market are nill. We will need another exciting bull market. Don’t fall asleep. It will be a while. Aloha and I will see you in the chat room where quiet weekends turn into wild weeks. Just like I like it!!! ALOHA!!!!!