GOOG Soars past $800 Stocks Lift to New Highs on Light Trade

The market is able to shrug off a dip in homebuilder sentiment and move into new highs on the year. Small caps continue to lift despite ultra light volume in the IWM tracking ETF. Volume on the day was below Friday’s option inflated volume. NYSE composite came in second adding 73 basis points boosted by Oil and Gas sector followed by Utilities. High gas prices and higher payroll taxes appear, for now have yet to cause any impacts to consumer spending despite WMT internal memo leaked on Friday. Our uptrend remains and we are going to continue to stick to it until we see evidence to suggest we are going switch gears. Volatility continues to be compressed as this market continues to push to the upside. Fears of any shock in the market have subsided as we have yet to see any major hurdles arise. We have our exit strategy in place so we do not fear any move to the downside. However, it is interesting to see how much volatility has compressed since this market has pushed higher. There isn’t any fear out there. Whether that translates to further upside or not remains to be seen. We have our uptrend and are operating as such. Until we see distribution piling up and leading stocks breaking down then we’ll switch gears. Tomorrow we’ll get the FOMC meeting minutes. The central bank has its work cut out for it trying to navigate the QE waters. Ben Bernanke has committed to an accommodative monetary policy for the United States. The Fed has pumped trillions of dollars into the market and trying to exit this strategy will be extraordinary difficult. How do you remove an addict from its preferred drug without causing the maximum pain? Perhaps we should accept the pain as temporary? Very interesting to see how this all plays out. For us Trend Followers price action will dictate how we react. Distribution remains elusive and with the market continuing to make new highs without any institutional selling is not a recipe to sell. We’ll let the market come to us rather than predicting where it will go next. Short-term Trends TICKER ST TREND TREND CHANGE DATE CLOSE % SPY UPTREND NO CHANGE 2/19/2013 153.25 0.75% IWM UPTREND NO CHANGE 2/19/2013 92.55 0.88% QQQ UPTREND NO CHANGE 2/19/2013 68.24 0.72% USO DOWNTREND NO CHANGE 2/19/2013 34.96 0.69% UNG DOWNTREND NO CHANGE 2/19/2013 18.30 2.92% GLD DOWNTREND NO CHANGE 2/19/2013 155.33 -0.28% SLV DOWNTREND NO CHANGE 2/19/2013 28.44 -1.35% DBC UPTREND NO CHANGE 2/19/2013 28.24 -0.39% FXY DOWNTREND NO CHANGE 2/19/2013 104.77 -0.02% FXE DOWNTREND NO CHANGE 2/19/2013 132.81 0.19% TLT DOWNTREND NO CHANGE 2/19/2013 116.5 -0.50%

DELL Lifts on Buyout Rumor as AAPL sinks Volume ends Mixed

A very quiet day as volume on the NYSE runs very light below Friday’s level. AAPL, RIMM and DELL shares supported the higher volume on the NASDAQ, but were unable to push the NASDAQ into the green. AAPL was able to close above $500, but it continues to come under selling pressure. The DELL news helped the NASDAQ and the rest of the market when it jumped above $12 a share. All in all today was a quiet day on the NYSE. The NASDAQ did see higher volume notching a day of distribution, but with DELL’s move helped remove the sting a distribution day would give. We can argue about the headwinds existing for the market, but for now the uptrend remains in play. Tomorrow we will get quite a bit of economic news to hit the market at 8:30. We have the following: Empire Manufacturing, Retail Sales, and PPI. It is anyone’s guess to how these figures will move the market, but they will likely move it. At least we can blame the Fiscal Cliff or any move the market will make. There will be a lot made of the retail figures due to the holiday season and how Black Friday may or may not have pulled sales into November rather than December. Boiling it down it is all noise and the market action is all we care about. Leading stocks acted well today for the most part. We continue to see decent action amongst the leaders. One leader LULU was hit in after-hours trading after lower revenue guidance. In after-hours trading the stock is off more than 7%. XXIA continues to act well push higher by almost 9%. The right side of this pattern didn’t have much volume, but we continue to see positive price action in the stock. We have a few other stocks we were looking at that are close to breaking out or have. You’ll have to check out our forums tonight to get the names. Action here certainly supports higher prices, but we keep on waiting to see this market push higher. Have a plan and execute the plan. Make this a great week!

Dollar Falls and Stocks Shake-off Intraday Sell-Off

Shaking off a late morning sell-off the market was able to rebound closing near the highs of the session as volume pushed higher on the NYSE, but flat on the NASDAQ. The EURO raced higher after comments from the ECB rate announcement pushing down the dollar index. AAPL was the catalyst for both moves in the morning and late afternoon as the stock continues to move sideways after its most recent decline. The NASDAQ and Small Caps hit new highs for the uptrend a good sign for the market in the short-term at least. Our uptrend continues to play out and barring any price destruction should continue on its merry way. Gold and silver rebounded today after their most recent sell-off. Despite the Federal Reserve signaling a possible end to QE forever the metals have been able to rebound somewhat. Crude oil once again moved higher while the rest of the commodity space remained relatively flat. The inflation trade in stocks and commodities still lives. Sentiment has crept back to lofty levels for the market, but not at the highs previously seen. The AAII bull sentiment figure jumped to 46.45. This past year the high for the index hit 51.64 back in February of 2012. The market was still able to rally higher and set a new high for the rally showing sentiment is not a reliable indicator for the market. Bears came in at 26.92 well above the 52 week low of 17.18 set back January of last year. Neither sentiment readings are at extremes, but we are close. The Investors Intelligence survey showed bulls back above 50% at 51%, but no near the high of 58% set earlier. Given the recent action and the lack of ultra-bullishness it appears this market has some room to run. Tomorrow we’ll get a reading on prices on imports and exports followed by the Treasury Budget announcement at 2pm. The deficit is expected to come in at -1 billion dollars. Many took income in the month of January rather than in 2013 due to the fiscal cliff. It will be interesting to see how much money the Treasury will be able to net. I’d think the estimates are off and likely sway when the debt ceiling debate would begin. We can only speculate at this point, but something to keep an eye on. As we ride into the weekend, we expect to see this market hit new highs and stand ready to act as necessary. Cut those losses.

Hope Continues for a Fiscal Deal, but Stocks Fall in Mixed Trade

Just the headline of a meeting between Boehner and Obama helped push the market off the lows. There is desperation for a deal for the fiscal cliff. The market for the second straight day rolled over from the morning highs. Despite doubling down on QE infinity stocks have been unable to crest above last week’s high. Volume on the NASDAQ rose giving the index another day of distribution while volume fell on the NYSE. Price action is not strong at the moment and given the lack of thrust from recent breakouts this uptrend we have been in is at risk for failing. Cash remains king. The fiscal cliff is such an interesting beast. On 11/16 we were close to getting a deal and yet four weeks later we are no nearer a decision than we were on 11/16. Our government spends roughly 25% of GDP by borrowing forty cents for every dollar spent. It is a nice thing to say we aren’t taxing the rich enough, but taxes only get us so far maybe 1/10th of the way. While we have been able to implement tax cuts we have never been able to cut spending. It is time to take our medicine and begin down the path of sustainability. This recent uptrend is still without a true follow-through day and even though we could get one tomorrow it isn’t likely it will produce tremendous gains. Days 3-7 are the sweet spot for a confirmation of a new uptrend. The lack of follow-through day simply underscores how weak this uptrend has been. Where are the stocks zooming out of bases? Sure we have had some breakouts, but they aren’t screaming higher like we normally see in a sustainable uptrend. As of now, we do not have the strength needed to continue this rally. This action is the main reason despite our model switching to a BUY signal two days ago that not one position was placed off of this signal. There was simply too much cross-currents and bad/confusing action. Our model has obviously returned to the NEUTRAL mode. No harm, no foul, this time around. Know your exits and if the situation changes be ready to adapt! Have a great weekend.

NYSE Posts Second Day of Distribution as Reid Signals Congress Still Can’t Get its Act Together

For the second day in a row the Dow Jones Industrial Average, S&P 500, and the NYSE Composite posted another day of distribution. It is an ominous sign for a newly developed rally to post back to back days of distribution after a follow-through day. Positive economic news from Durable goods to housing did very little to help this market today. Sellers jumped aboard just before the 10am hour, but were held back by another intraday rally like Monday’s session. It appeared as if the NASDAQ and others were ready to bolt to higher ground before Harry Reid and Mitch McConnel spoke about the Fiscal Cliff talks. The market couldn’t rebound and ended near the lows of the session as volume jumped. This rally has a negative tint to it and the next move on volume will spell out the direction we’ll head in the short-term. Friday’s supposed follow-through day kicked off a new rally and the one thing you do not want to see is distribution within the first few days after the follow-through day. Unfortunately for this new rally is we have had back-to-back days of distribution. Monday’s intraday action was bullish, but still put the NYSE composite, S&P 500, and Dow into distribution camp. Today’s action was clear distribution and is not questionable. Distribution following a new confirmed market rally spells trouble for the rally attempt. I’d expect to see this rally fail shortly and we’ll be on the hunt for a new uptrend. If we move higher on strong move we’ll change our tune, but for now distribution is spelling trouble for this rally attempt. Financials rolled over today with the XLF rejected at its 50 day moving average. Retail (XRT) still is having trouble with its 50 day moving average despite the media’s attention on how good Black Friday sales were. Oil and Gas was the biggest drag on the S&P 500 followed by financials. A sign the market is on shaky ground is from the only sector higher on the session being the Utilities. If we don’t see the market improve here look for utilities to show strength while the rest of the market heads lower. If you jumped into the market yesterday or today remember to have an exit strategy. It will mean the difference when it comes down to your returns! Buying is the easy part.

Stocks End The Week The Way They Started With Another Selloff; Long Gold/Silver/Platinum + Short Stocks = Big Profits In This Market

Stocks ended the week the way that they started with all indexes closing down across the board with indexes down anywhere from .1% on the Nasdaq to down 1.6% on the NYSE. The bad news about the losses, today, is that the NYSE and SP-500 (-1.1%) suffered a clear distribution day. The DJIA had a huge distribution day but the bullish intraday reversal and the huge level of volume would appear to be more short-term bullish for me. Why? Because the DJIA has been down 20 of 31 days before today's huge volume down day's intraday bullish reversal. Either way technically they are distribution days but when using "art" with "science" it is clear to see today's losses were not vicious.

What is more problematic is that the longs scans looked worse than only a 1% down day. That just tells me that the market probably is in no mood to rally any time soon and this is probably why we can not find ANY "hottie" chart patterns or high quality CANSLIM stocks setting up in proper patterns with growing fundamentals. The market has turned down on the micro and macro and it will take time to get these stocks growing again. It will even take longer if we go down the road to socialism. If we take a track that has proven to NEVER EVER work in the history of the world, then it might be safe to say the "hottie" stocks might not setup. If that is the case, we will just keep focusing on our shorts in the market and our gold/silver/platinum longs which will make us excellent money in a market like that.

A lot of people seem to not realize that there is a HUGE correlation between long bull markets and technology and financials leading. Even in 2003 the huge bull market rally that we saw that year did not just have technology leading it also had banking leading. Stocks like GS were leading the sector higher making these companies a lot of money. This happened in 1999 also as one of my best longs was a payment system stock that worked in banks. So you normally need banks to help rally the market if you have a healthy market. So I am sitting here wondering what is going to happen if the socialist agenda of our Congress is put in place and our banks become nationalized. You better pray to the Lord above that this doesn't happen. It will flatline and kill banks as investment vehicles and somehow excess capacity will have to be moved from these dead banks to new alive stocks that haven't been killed by socialism yet. There are always future technologies like nano dust, artificial intelligence, security, robotics, and many other green technologies. However, if the venture capitalist have no capital to loan and the banks have no money to loan. NOBODY is going to make money. So let's pray our system makes it through this.

For the week, the market took it on the chin with the IBD 100 falling 4.5%, the DJ down 6.2%, the NYSE lost a whopping 7.7%, the SP 500 lost 6.9%, and the Nasdaq lost 6.1%. It was not a pretty week and that can be confirmed with the amount of longs we had decrease from 10 to 5 and our shorts increase from 39 to 43. I think it is obvious which side is the right side right now, unless you are keeping warm in cash.

With the mess our leaders are making with these trillion dollar SPENDINGULUS bills, these $75 billion housing plans, this exponential printing of money, and the nationalization of banks have me thinking only one thing for the long-term. That is GOLD baby! My gut tells me ANY pullback we can EVER get to the 50 day moving average or the 200 day moving average should be an area that we buy a LOT of gold. The 21 DMA can even be used. However, I have 25% of my IRA in Gold and would not mind putting 50% in it if I can get a proper pullback. I will not chase and will remain patient and let it come to me. When my "hot" max green BOP filled, heavy accumulation filled, and excellent price action stocks setup, I will be going long and strong.

However, if they don't show up and an opportunity to go long comes along, a bounce of Gold right off the 50 day moving average sure looks like a smart thing to do when you have a long-term time frame based on the US Dollar collapsing under the spending in the gov., the corruption in the gov., the printing in the gov., and the lying in the gov. This will lead to China to stop buying and will send Gold/Silver/Platinum exploding higher. Gold is already made us a good amount of money in a short time and we hope more is left. Don't forget to keep an eye on AGQ for a BIG ultra silver play. This is a very bullish silver chart and any pullback BEFORE a climax run should be on a lot of investors wish list.

The bottom line this Friday is that I have had a GREAT week with our gold longs producing large gains in our big holdings, our shorts ALL did us very well giving us nice gains, and the best part is that we still have a LOT of cash on the sidelines to use in case any of those exciting stocks we have fallen in love with since 1998 come along and setup again. I know it will be sooner than later as we still have some nice charts holding up out there that could become "hot, perfect, wonderful" chart patterns in a few more weeks to months. We will see, it is still early. Remember everyone, CASH IS STILL KING, SHORTS ARE QUEEN, and GOLD/SILVER IS PRINCE!

top longs/(shorts) with TOTAL RETURNS since purchase MAKING ME MONEY TODAY: ANCI 56% (CETV 92% CEDC 82% CYT 68% SDA 79% RIMM 60% GGB 63% TITN 54% AMX 51% APD 44% OKE 44% IPHS 48% CEO 32% RDK 30% PG 21% CPRT 22% BOH 22% PLCE 29% AMSG 27% PRGO 25% LLL 19% K 19% WRB 15%)

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Bullish Week Ends With Leading Stocks And The SOX Taking The Lead (Part Two)

Randomly continuing where we left off yesterday, besides the put/call showing a little of fear coming back into it even with some indexes higher. One index continues to print what should be considered bearish numbers. That is the VIX. The VIX closed at 16.47 Friday and intraday on Wednesday hit 16.10. That was the lowest reading since October right before the November top.

I know I am very bullish on this market, even without volume, due to all the setups and charts that are already breaking out out there. But don't question if I would turn, if we got like three major distribution days in-a-row. If that was the case and there was no bounce here, then you have plenty of reasons to get bearish and top calling. But as long as we have stocks like EXM DRYS, and even CNQR showing up, I think I will hold off on top calling. For all I know it will take the put/call to hit .40 and the VIX to hit sub-10 before stocks finally top off this current run.

People that have already sold all of their holdings that they started buying in March, just like the people that told me to bottom fish in March, are just not at the level they need to be at. Nobody, should be out of any DGLY, GFA, or any of the other recent longs like PWRD ISYS and OTEX which have not acting perfectly since going long (that is unless you are a newbie then you should lock in anywhere from 10% to 20% on DGLY, VISN, or anything else up 50% since we went long the past few months). However, they are not acting like GENC and it is a great thing. FEED, even before the recent selling, gave us plenty of time to take some off the table; I took 50% off before the move down. Did you?

Why did I do that? Because look at the chemical stocks. They all look like they are near a major top and the fact that they have not topped yet is SHOCKING to me as the chart patterns have set themselves up more than once in becoming perfect tops and thus good shorts later on. But when I look at MOS, POT, CF, and TNH, I know that not only have I take a 300% and 500% gain in TNH and MOS respectively but that I am in the right place by being on the sidelines as the current chart patterns are LOADED with flaws and the EASY money has CLEARLY already been made in these chemical stocks. If you are focused on them now, I ask you, where in the heck were you in 2003, 2004, 2005, 2006, or 2007?? You are a little late buying up here for a big position play. I am looking for a top.

And hopefully when that group tops, the market will shrug it off and actually take off, as a rotation from commodities to technology could almost be done and waiting for that group to top before blasting off. We will see. At the same time this rotation is occurring it is obvious that money is not coming out of the energy/oil&gas sectors of the stock market. Those two groups continue to show extremely bullish action and there is no reason to think they are done when solar stocks are only now starting to blast-off. I also do not see any oil&gas stocks making clear climax tops. That means that the run is not over and the way they are dominating the top of the IBD industry groups, only a fool would bet against these stocks here. But I take it a lot of people are or else there would not be a near-fourteen day NYSE short interest. Amazing.

If you look at the top 20 industry groups based on six-month price performance, eight of them are energy related, three are transportation related, and three are metals related. What is even more bullish for these stocks is that the transportation-shipping group has gone from #133 to #15 the past three weeks. Stocks like TBSI DSX EXM and DRYS are all setting up in BEAUTIFUL bases. I want them all, when they breakout or bounce off key support, now that the charts are right.

If I was undisciplined I would just buy them now. However, I know my game and my game makes me a lot of money. I know either buying too early or doing the worst investing mistake and chasing a breakout too far past the appropriate pivot point is not the right thing to do. So I simply do not do it. It is that simple. Don't break rules that have been PROVEN to work. How so many people can have the CANSLIM system handed to them and they simply do not take the time to learn how it works properly is STUNNING to me. It is stunning those few seconds of the month when I waste my time and watch CNBC and see so many that subscribe to IBD NEVER talk about anything the paper preaches. Especially Cramer.

How can you know that history has been mapped and chartered to show us how the best stocks work and yet you tell us to double down on NXY, IMA, or SHLD back in the day POST-top? Horrible. Patience pays off. If you daytraders would look at how much easier your life would be by making one buy and a few partial sells before a big final sell and without paying constant commissions would really improve your returns and open up your day to more free-time. There are always a few who do better being more active but I doubt those people were long my LMLP, TASR, IST, FMDAY, AFSI, or HRZ for some nice easy-to-handle big gains.

I don't like being active as I know the big money is made in the holding. If you like being active, GREAT! However, if you are active and are not happy with your results, I must recommend that you read and study my Past Big Winners. If those, and the list and list of stocks in all of the O'Neil, Weinstein, Boik, Loeb, and Livermore books, don't convince you, I have no idea how you are going to last in this game. Especially as returns vanish with a low VIX and a market FULL OF THOSE HORRIBLE ETFs which now receive money that used to go into REAL stocks. The money in ETFs could be added fuel to the fire of DGLY. But instead a QQQQ or SPY will do. Oy.

Getting back to the market's performance the past week, I have to say while I am looking for a short-term top that could lead to a shallow pullback, I am not going to convince myself that it is a given that it will happen. If this market wants to continue to run that is fine with me. The stocks I am long are going to have to show me blowoff topping signals, reversal signals, or straight up fail before I will sell a market that has this many high-quality stocks moving higher. Even with volume below average on the NYSE and only a few days of above average volume on the market. At least those days are either up or have bullish reversals.

What clearly makes me bullish here (but remember I am ALWAYS ready to sell, if I have to) is that leading stocks and the exciting tech stocks are taking a clear lead. Last week, the SOX led everything with an incredibly impressive 5.8% gain and the IBD 100 was right behind the SOX with a 4.2% gain for the week. Both indexes did much better than even the strongest mainstream index. The SP 400 gained 3.5%, the Nassy/SP 600 3.4%, and the worst of them all was the DJIA with a 1.9% gain.

This to me clearly tells me that this is a market I want to be interested in. I am interested in all markets but when I see technology stocks AND leading stocks taking the reigns as we move higher, I have to support that. Low volume or not. Do I want to see volume return soon to the upside? You better believe it. Will I be OK with a low volume rally? FOR SURE!

Right now there are too many stocks extended or they have come off the lows too fast and need to base out. Stocks like FSYS, FSIN, HMA, and MVL would all make GREAT longs in my portfolio. But there is no way I will buy these until they calm down, setup, and breakout again. Just like my CLR long. Everyone seems to want to buy it now. I am NOT touching it again until it touches that 50 DMA. Better safe, than risky and sorry.

Other stocks I would like to get long at some point with a good entry would be SNHY, BUCY, WBD, HRS, ESV, EXM, DRYS, DSX, DO, UPL, and about another 100 oil&gas stocks. Chasing just isn't my game. Patience is.

I don't have much else to say other than without options expiration volume probably would have been lower on the Nasdaq. So I guess volume was kind of lame on even Friday's move. Not that it is important or anything. I just thought I would throw that in there to illustrate that a low volume rally is what this is.

That means that sentiment dominates. Since the big boys are not putting a ton of new money to work and the volume is real low, you would think the market would be going nowhere. But the old maxim is to "never short a dull market." Yet with all this low volume that is what knuckleheads are doing. The negative news that I have discussed earlier, the negative polls with another one being released Tuesday, and the SP 500 having the worst earnings, dropping 25.9%, slump since 2001, going three q's in-a-row down are all the perfect backdrop to continue to have that NYSE short interest ratio rise and to see the put/call climb higher. Right now, the media is a growth investor's best friend. Their lies and BLATANT exaggerations make this possible.

Every message board or blog comments section I read has at least a handful of doom-and-gloomers and if you guys did not have the pleasure to listen to the comments coming from the yahoo message boards posters the day BSC collapsed then you have no clue how negative it is out there. People are simply disconnected from reality and the poor continue to get more poor due to policies they THINK is helping them but is in fact making it worse. Ignorance and being uneducated is a horrible mixture. Along with being easily manipulated. Combine those three traits and you have the politicians favorite targets.

I am going to do a post later on tonight that will focus on the strong stocks in strong sectors. I recommend, while this market is moving up, that you focus on these areas of the market in the upcoming weeks. It will be beneficial to your bank account.

Aloha from a beautiful and gorgeous Maui "where every little thing is going to be alright." I hope you all got to watch the Penguins win and watch the Celtics win. If you did not, you seriously need to get a Tivo. And if you do not like sports...you are a nerd and are probably the donkey that decides to come to Maui and "learn to surf" then you paddle out to our breaks and get in our ways and almost kill someone. What a great year for playoffs in the NHL and NBA, we have the Yankees and Mets tonight, and this year's ASP has been incredible so far. Get off your butts and get to the gym!!!!!!! :) ALOOOOOOOOHAAAAA!!!!!!