A Very Very Good Day, Overall

NO COMMENTARY TODAY

New Swing Longs: AOB NX LKQX NOVL HOKU ALY TRAD ECLP LWSN MXWL BRLC

Longs Outperforming Market: TGC CNVR ABP TDW INFA ESV PDE THE ARD CKH OXPS BMD DEPO ENER PFWD VRTX PMU ICGE CHB ESLR HAWK MCF WVCM

New Swing Shorts: WCG TZIX

Shorts Outperforming Market: LHCG

A Day Much Weaker Than It Looked

The markets mixed their closes for the day, with the markets up .1% to down .3%. Volume also rose across the board, indicating churning and indecisivness on investors part.

The SP600 had its 5th distribution day since the ugly rally started on 9/6. This is nothing like the action I saw after the April/May bottom when virtually zero distribution days popped up after it started its move. The market then continued to go higher and higher, pulling back on low volume.

With Oil/Energy and Gold sectors outperforming and some Food stocks getting involved, it is starting to look like the market is ready to give up the rally. Add to that the continuing weakening thesis of the "tech rally" and you come to a conclusion market doesnt feel so good.

But right now, we just dont know, because the market is flat-lining. Some could call this base building but a lot of stocks are really extended and building late stage bases for this to be a base building stage leading to new highs.

Bottom Line: The market doesnt look or feel good right now. I guess we continue to wait and see what will happen, since we are getting no help from the indexes. But remember all the "poker tells" indicate a weak market about to get weaker.


I wish you all GREAT luck.


New Swing Longs: WITS TGC SONS ROYL QVDX FTEK PKE EWST

Longs Outperforming Market: OMNI ABP GMXR ARD KNDL ASF THE ENY PFWD HEC PMU MUSE NSC SPNC SNG ZIGO JCDA

New Swing Shorts: AMHC VCG SVR LHCG

Shorts Outperforming Market: JVA CNTF CWTR

Flat Day With Mixed Volume

Stock market indexes basically did very little today. They dipped down then rallied to new highs but then closed mixed in weak last hour trading. With the mixed volume and unchanged session on the indexes, it is close to impossible to read anything into this day.

I have to say I was very impressed with Alan Greenspan's speech today on CNBC. I thought he made his point very clear of showing his continuing enthusiasm for the free market system. Though I may think he is overdoing it now and overdid it then in 2000--with the rate hikes--I still am very happy overall of the good job he and Paul Volcker did while they were Fed chairman.

Besides the speech there was two negative news items today. The consumer confidence numbers and home numbers showed the weakness that plagues the consumer right now. My only problem is with the bad consumer confidence. If Katrina, oil, the war, and jobs was "so" bad right now, why are the indexes basically flat for the past two years? To that question the answer is the relentless negative news that is put on us every day by the media. Nothing great is every highlighted, though many stocks continue to provide fantastic gains.

Do you want to know what those great stocks are that are producing huge gains all the time? Just read my blog. I give them everyday. While people cry about high oil and all the "bad times" they are having, I am going to work, putting in the extra hours, and making the sacrifices neccessary to make a great living. You can blame your situation all you want, but there is a free market system out there for you to take advantage of and better your current situation NO MATTER WHO YOU ARE.

So remember while people cry about how poor things are going, you can be investing in the stocks that could make you rich, with me. I do not hype. I simply state the facts. I have made money in good times and bad times and people keep telling me this is a bad time. IT ISNT AND IF IT IS GET OVER IT AND PROFIT FROM IT TO MAKE IT GOOD TIMES FOR YOU.

Go over all my "longs outperforming market" and tell me if stocks suck!!!!!

New Swing Longs: UFCS LRW CASY PDE STXN REGN CHRD COSI DANKY BVF

Longs Outperforming Market: ENY CNR GMXR ABP THE ARD TFR WC MII DESC DEPO TFSM PMU ESLR UQM MUSE IVIL CRXL APT NWRE CRDN ESV ASF NSR FSTC CVO ASGN

New Swing Shorts: MICC JBL RSAS CWTR GEHL KEA

Shorts Outperforming Market: CNTF

Short-Term Trend Up But Weakness Still Lingers

The major stock market indexes finished higher across the board--None of them over 1%. The leader in the group was the SP600. The volume came in lower across the board, indicating this short-term uptrend is possibly just an oversold relief rally. The sub-inter trend is down and came on higher volume than this little bounce. So dont get to confident that this could produce anything spectacular.

Oil and Metal sectors are the bright spot during the past month. And, with the media having to focus on the new "fear"--now that Rita has past--inflation is probably going to be the new lead story. What to do? Well if you want to take advantage of the upcoming inflation, buy some good stocks in those sectors breaking out of fresh bases or bouncing off a key moving average. As long as you dont average down, you will be fine. Or if you want to just complain how much prices are rising and how expensive gas is, you are more than welcome. I will just have to profit, without you, so I can afford the gas and continue to live comfortably.

Stay positive and remember you can either complain about inflation or take action and profit from it. That is what successful people do. And I know anybody reading this has to be a little successful or aspires to be.


New Swing Longs: CRDN CKH ACPW TFSM AAI OPTN ICGE AWA GCOM MGN

Longs Outperforming Market: OMNI ENY NTES TFR MNG KNOT VIVO FSTC NSR BLDR RCCC MNTA ZIGO UQM ASGN BNN ECTX

New Swing Shorts: NAT

Shorts Outperforming Market: CYPB RCNI PGL

Not Much To The Bounce; Waiting To See Damage From Rita

Volume was lower across the board as the market indexes continued their bounce today. Ummmm......Besides that there really isnt much else I can add that I have not already said the past two or three days.

I find it hard to comment on any market action today, considering as I write this Rita's eye should be near landfall on the TX/LA border. We will need to see how the market reacts to the weekend news, on Monday. I have a feeling this market is much weaker than most people take it for. I have given my thoughts on why the market is weak for the past three days and continue to feel the same way after watching the market action today.

Say a prayer for those affected by the dual onslaught of hurricanes.

I have a lot of personal issues to deal with this weekend so that will be my reason for not having much else to say before Monday. If I change my mind, you will see it here.

Aloha from Mauifornia

New Swing Longs: NSR IDIX RRI FIX ANEN

Longs Outperforming Market: GEPT BCRX VIVO ADST CVO RIO TRMS

New Swing Shorts: GGXY RTEC NCI CYPB

Shorts Outperforming Market: IPCR LEND NEW

Biding Time Till Rita Hits TX/LA

The stock market indexes rose today, reversing an early selloff and closing near the HOD's (high of day). However volume was lower across the board so there really wasnt conviction by buyers that they are ready to support this market.

The market may stay dead on Friday. Hurricane Rita is just too much a factor right now to figure out what the market might want to do with it. Until this hurricane passes, the market is going to be held hostage by it. And if you think you know what the market is going to do, you are lying to yourself. This market has no clue what it wants to do.

One of the more odd things I saw today was the ratio of bullish/bearish newsletter writers. The number of bulls went up this week!! With all the stocks breaking down, rolling over, and starting obvious downtrends, newsletter writers turned more bullish. This is not what makes a bottom. Bottoms are created when there are more bears than bulls or the number of bulls/bears is even. Since this downtrend is under way and is now obvious to the investment community the writers should be getting more bearish. If the writers continue to stay bullish as we move lower (if we move lower) this downtrend could last a while. If they were already turning bearish with all the media negativity I would think it might not last as long. But with them still being bullish after all the media BS, ugly individual charts, and knowing the obvious negative economic impacts of natural disasters I have a feeling this could last a while. I hope I am wrong.

New Swing Longs: ELK GFIG OMNI

Longs Outperforming Market: ENY DBLE CNR FUEL WSSI BNN

New Swing Shorts: TWGP CPTV SEAB WMS GOL OPEN AGE

Shorts Outperforming Market: RUTX ALLI EMAG IPCR TNH WMAR FDO ETR

Downtrend Intensifies; Hurricane Rita Weighs On Market

The major stock market indexes finished near or at their LOD's (low of days) for the session, with volume well above the 50 day average level. The Dow, SP600, Nasdaq, and SP400 all closed below their August lows, giving the indexes a confirmed failure of the 9/6 follow-through. Volume slowed a little on the Nasdaq and rose on the NYSE. This gives the SP500 its third distribution day since 9/6. The SP600 scored its fourth distribution day since 9/6, leading the way down. All major indexes trends are down and most have now broken the August support and trendline connecting the bottom price range since the Arpil/May rally.

Until Hurricane Rita passes the Gulf Coast, this market is held hostage by the possible damage that it will create. It is going to be a very long two days, until it makes landfall, for the stock market. The media is sure to make it feel longer.

Hopefully all the negative news stories out there will lead to a small relief rally, if the worst does not happen from Hurricane Rita. A rally seems reasonable, considering the oversold conditions some stocks have. But just because stocks are oversold doesnt mean they cant get more oversold. Normally when you move down fast like this, a relief rally only relieves some of the downside pressure before heading lower again. Have a method ready for covering some shorts, incase there is a big relief rally or hopefully you are already in cash and are ready to put money to work when this downtrend ends.

In the meantime, there are too many negatives out there to be a hero and buy the indexes. A hawkish Fed, slow growing economy, oil, hurricanes, October, poor consumer confidence, and home prices easing give the edge to the bears for now. As long as the media continues to act like the end of the world is near, you can be sure capitulation will happen eventually. This will help create a real bottom and give us something to really rally off of. When this happens who knows? Until then there is too many ugly charts out there and shorts are working well, so stay cautious.

New Swing Longs: TUG BNI BXC GEPT MTRX SONS SBS MGN ROYL VTO DBLE

Swing Longs Outperforming Market: FLDR RIO ARD HOS FUEL SNG ABIX MNG DESC CHB SPN VGZ ZIGO ECLG SYNC TMM ECTX ININ

New Swing Shorts: CNXS RRGB NYT AFFX PTP AXS CY VFC BLC FCH TSA RPM ANN NXL KNX CRE CNF PP HCC ABCW BXP BRKB RUTH ALLI RUTX LAZ SFC. You better be able to find something to short in this group. They are all broken and should cruise down.

Swing Shorts Outperforming Market: NLC CTRN LNY IPCR HIBB SONC CENT APPB JOE SNS JCP PCLN ANF SPF SHW CAKE TMA ETR SPG BYD ALL FED RYL TRI JWN PPG MNI CTX PGL HMA NWS LVS EMAG

On The Radar Screen: QVDX MSL

All those shorts I have been holding have finally paid off. I finally can sleep REALLY REALLY well tonight. I am not going to lie, the past two weeks have been hairy for me. Now I can start to relax and trim some shorts that have paid off.

I hope everyone is positioned and ready for the worst. When this downtrend is over, the negativity should be so thick that the new longs should provide wonderful gains. Stay vigilant and positive amongst the negativity that the media surrounds us with everyday.

Aloha.

Downtrend Confirmed; This Was A Bad Day

The market indexes started the day higher, but after Alan Greenspan hiked rates for the 11th time in a row, the indexes reversed on heavier volume and closed near the days lows. They were down anywhere from .5 to 1.1%.

Volume was higher on all indexes. That gives the indexes their second or third distribution day since the 9/6 follow-through. Along with the higher volume came poor breadth, confirming the weakness today.

Retail and Homebuilders got smacked again. I normally am not a fan of being a bear, but seeing Homebuilders fall hard makes me happy.

I can not stand excess speculation and that is all the real estate market seemed to be the past two years. Living on Maui, I heard enough real estate stories to make me want to move. This reminded me of New York City back in 1999-2000 during the stock market bubble. Though during that time, I moved in June 2000 out to Maui because I knew it was over.

Oil is obviously having an impact on peoples pocket books by looking at Retail and Homebuilder stocks. That along with the next big hurricane--Rita--is creating a lot of pessimism out there. It seems as if everything is really aweful. I guess that in itself is the only good news out there, since everyone is negative we should go up, right? Unless those people havent sold yet. I have a feeling they are just now selling. You can not have a bottom this early in a downtrend. This thing is just starting and the pessimism is going to grow and grow. Then we will have a "REAL" bottom to rally from. And just like in April/May (read my old entries) when everyone is still bearish, I will have cash ready to buy the best of the best. I look forward to a nice big down move, to be honest.

Bottom Line: Technical picture is getting worse and worse. The downside momentum is picking up, shorts are everywhere, and October is right around the corner. All sub-intermediate and short-term trends are now down for all indexes.

I wonder if the market is going to crash in October? I wonder if history will repeat itself? Let's see!

New Swing Longs: HDB ESV PORK ZIGO NSC RITA FIX

Longs Outperforming Market: SYNC ARD ECTX NRPH DEX ECLG CNQR AMAC

New Swing Shorts: JWN UACL APD HNZ PPG FORM CTX CAKE HOT FDO MVC HDI HET LIZ AVP ALB ACAT LZB ETH PGL NAV

Shorts Outperforming Market: TXRH LEN SPH TOL ANF HOV SHW MNI IPCR

One Index Follows-Through To The Downside

The major market indexes all fell today, closing down about 1% across the board. The NASDAQ and Dow closed below their 50 day moving averages. With that the NASDAQ has traded below the 50 dma, rallied to the line, failed, and has now followed-through to the downside. This brings the short-term trend and intermediate trends down in the NASDAQ. The other indexes are stronger than the NASDAQ but they are showing many signs of weakness.

Breadth was 2 to 1 negative, continuing a recent theme. Oil/Gas stocks led the way with the top 10 performers having nine from the Oil group.

The markets are very schizo recently. Stocks have gone up and down and back up in a very volatile matter. It seems more volatile than the 12 reading the VIX is giving us. Longs remain difficult to buy and hold, shorts blow past cut loss points or gap too far to be shorted, and the indexes are going sideways but it feels like it has been crashing.

I take it all the negative news "all day all the time" on TV has something to do with it. That is not my opinion, it is truth.

Whatever happens to Rita, remember to be ready for an upside breakout or a downside breakout on the indexes. The way things are shaping up currently, the downside looks like the path of least resistance. I say this, however, with most trends long, mid, and short moving sideways to up. I am either seeing the action in my individual charts and coming to this conclusion, or I have been brainwashed by the NY Times, CNN, FoxNews, and all the major news networks to believe this next hurricane could be the second sign of Armageddon.

New Swing Longs: BDE PAY BDCO FUEL ALY

Longs Outperforming Market: ENER ESLR ABP ARD SFCC DEX PANC TVIA TERN AAPL

New Swing Shorts: CTRN LVS MNI WBS FO ALL SHW DTG KPA WNC INPC

Shorts Outperforming Market: TOL PTC TNH BBY HOV SPH LEN IPG

Stocks On Radar Screen: MSL MXM REF FLT

Too Much Surfing; Market Commentary Maybe Later

New Swing Longs: FLDR SMTS CLDN LSTR CLF AMAC GRC ANR CNR MACR SSFT TERN GOLD ECLG TRAD ACE

Longs Outperforming Market: HAWK ARD BTUI RGLD ININ ARS RIO FLSH CNVR TVIA PXP ABX PYX VGZ MSLV JCDA ILOG

New Swing Shorts: RYL BZH KBH SPF DHI HOV PHM K SPG TMA TZOO.

Shorts Outperforming Market: CNTF. This section seems pointless as most shorts dont tank, but I will keep posting it.

Stocks On Radar Screen: TOFC NHC CAC TKC FADV MXM LFKN CTIB GV CAV HDSN IAO FLT SPDR

The Best Pictures From Tahiti. Teahupoo Was Going Off ! ! ! ! ! ! !

THE SOUTH SHORE WAVES ARE BEAUTIFUL

What an amazing second day of watching the pros at Ma'alea. A day of surfing and watching great surfers surf the best waves on the south shore of Maui in 5 years was simply incredible. I watched so many boards break and surfers get barreled that I will remember these past two days for a very long time.

No market commentary, OF COURSE! I will say that I see a lot more charts breaking down and stocks are starting to set up good shorting patterns.

New Swing Longs: ENY CNVR DEZ DEX AEP JCDA

Longs Outperforming Market: ABLE GEOI LYTS BVN OXPS LF WIRE CHB PMU PFWD HAWK ILOG

New Swing Shorts: RMK WFC GDT CAL RFMD ADBL DISH TNH

Shorts Outperforming Market: CNTF ANF MW

Aloha from the beautiful South Shore of Maui where the past two days have been epic, inspirational, beautiful, and mind blowing.

Please visit: www.surfline.com to check out the action. If I had any knowledge what-so-ever about how to set a link to this site I would.

The Start Of Something Worse?

What a day today. And I am not talking about the stock market.

The surf today on Maui was just EPIC! 15ft. faces at most south shores and at least 12ft faces on the lower west side. For the south shore on Maui, this is rare and beautiful. I was able to get some great rides but nothing like what I got to see at a spot called "freight trains." I watched pros surf the fastest wave in Hawaii for hours today. It was something to see, even if you are not into surf.

Back to the market: A late day selloff on an increase in volume is the opposite of what you want to see after the markets follow-through. But sadly that is what we have had happen the past two days.

The SP600 had another distribution day today, making two in a row. The Nasdaq also closed strongly below its 50 dma. Very negative action for the two indexes.

Semiconductors reversed hard, breadth was 2 to 1 negative, oil moved higher, buyers are not interested in buying, retail numbers came in worse than expected, and Gold showed leadership today along with oil stocks. This makes for a market that looked bad today but has the possiblity of getting a lot worse.

Stay defensive and keep tight stops. A nice decline would help build some nice chart patterns for stocks to rise out of. But we would need to go down 10% and then sideways for a while to make a lot of charts into perfect bases. Especially after the run so many stocks have had since 2002.

The short term trend is down for all indexes. The sub-intermediate trend is latteral but appears to be ready to turn into a downtrend with further weakness. The intermediate trend is latteral to up, as the market is almost unchanged since beginning of year but still up nicely since April/may bottom. The long term trend since 2002 bottom is still up.

New Swing Longs: BKR BBL EVVV MNG PMU KGC AUY IAG VGZ

Longs Outperforming Market: KNOT TVIA RBAK ABP TRGL KNDL ASR

New Swing Shorts: CORS NGPS PVH ANDE KOMG FRP OGE NWS DIS KBAY PII NLS PENN

Shorts Outperforming Market: JOE CNTF WMAR

Stocks End Lower On Higher Volume

All the worries I had about the market yesterday were fulfilled today. Just as I expected, the market reversed intraday, closed lower, and had volume pickup to the downside.

Though the drops were minor, breadth stayed negative most of the day even when the markets were up. That along with the crazy action in most individual stocks right now shows the underlying weakness in this market.

BBY was a recent example of the possible impact of higher oil prices. Look at all retail from ANF to WMT. You will see the ugly action in the charts. How about the restaraunt stocks? Same ugly charts. Something tells me the indexes are holding up on hope and that these stocks (the old leaders) are telling us that a correction might be coming.

I am preparing by raising cash, keeping tighter trailing stops, and buying few new longs or new shorts.

Whatever happens, let it happen.

I might not be around the next 3 days, due to personal obligations. I will post new longs and shorts, but there will not be new commentary till this weekend.

Surf is WAY WAY up and I have a very important issue that I have to tackle and complete. So until then great luck with the market and I hope I get barreled multiple times the next 5 days!!!!!!!!!!!!!!!

New Swing Longs: KEYW LEAP TMWD

Longs Outperforming Market: PWAV ASGN SYNC PFWD UBET GLW MOT

New Swing Shorts: URBN LPNT SYK HUN WMAR BBY OSIS

Shorts Outperforming Market: IPCR

Another Day of Gains For Nasdaq; NYSE Closes Red

It was a mixed day for the markets, with price and volume. NYSE was down, Nasdaq was up and the same with volume on each exchange respectively.

I saw a lot of failed breakouts and reversals today. That along with the poor breadth has raised some red flags with me. However, the trend is up and the markets continue to climb this wall of "small" worry.

Still something just doesnt feel right. I am not sure which way we will go from here. Up, down, or sideways is possible with all the different chart patterns I have out there. But a lot of my long term holding are still going higher and make nice moves quite often. It is the new longs in my portfolio that are having trouble and that is troubling in itself.

I guess we will wait to see what happens, like always. But the new longs acting funny is just not what I would expect if the Katrina disaster is going to help us.

If all that money coming in to the economy from the Katrina disaster was going to help move the stock market higher I sure have not seen it on the volume statistics.

We are still barely doing above average volume on most days. The NYSE during its most recent turning point was very positive. But since then it has been lame all across the board. That is a sign that the money is not "pouring" into the stock market.

If we get some Nasdaq days up with volume around the April/May levels I will be a lot more happy with this rally. But for now this current rally is under my red flag watch for more signs of weakness.

New Swing Longs: IIJI DEPO TMO IMN MSLV

Longs Outperforming Market: REDF MOBE RTSX NTES EZPW WFR BTUI PWR CLHB NTGR VTIV PETS ROS

New Swing Shorts: WB IPCR

Shorts Outperforming Market: SPH

Stocks On Radar Screen: CWBS HDSN CAV HWKN

Good Ending To A Good Week On Wall Street

The stock market finished Friday the way it looked this week. And that is to say pretty darn good. The major market indexes closed around the highs of the day and volume was higher than the day before across the board. Very positive action, considering how negative the day "looked" yesterday to most traders and investors.

For the week, the Dow Jones and SP600 were the leaders, with both indexes up 2%. That shows the broad strength in this current rally from September 6th.

The market is in a confirmed rally and all trends are up. No matter how bearish you "feel" it doesn't matter. Until the stock market rolls over and distribution days pop up, you have to be bullish and follow the trend. That is where the big money is made. By following the primary trend of the stock or index.

New Swing Longs: CKP WLT REDF SNG PXP SFCC TGC ONXS MXRE

Longs Outperforming Market: CPST GAP ROS BVN CPTV VRNT FOXH RBAK VC ASEI SLXP RTSX ANAD CLHB NFLX CVO AAPL SCI

New Swing Shorts: STA CIB

Shorts Outperforming Market: ANF

Stocks On The Radar Screen: ALFC FADV HCT CAV PEIX VTO HRSH DDRX GAIA

Have a great weekend!!

Bad Day But Not A Terrible Day

The markets closed lower but finished the day near the midpoints of their daily ranges. The overall take on that action is that it was not a good day but not terrible also, since buyers stepped up in the end to pick the averages up off their lows of the day.

Volume was mixed across the board. But on the Nasdaq volume picked up. That along with the downside action makes this a distribution day. This distribution day is a hard one to call though because there was so much positive action in individual stocks. So, overall, my feelings are mixed on todays action.

The one thing I did pick up in the chat rooms was a lot of bearish views overall. A lot of individuals are looking for this market to drop. It may drop, indeed, but I have to follow the trend and all trends are up. Along with this uptrend is a lot of stocks that are making great moves. Just look at the "longs outperforming the market." For such a negative day, there sure was a lot of big gains in some swing longs I am holding.

I remain cautious yet bullish since all trends are up. Until we cut through the 8/29 lows, I have to put my money to work in longs because that is what is working.

Keep on getting bearish out there. That is what the market needs to move higher.

What if the market reverses and heads lower? Will I feel like a fool? Absolutely not. I will simply cut losses, raise cash, look for shorts, and enjoy the ride down. But until then onward and upward.

New Swing Longs: VRNT ANAD ISIS MOBE IINT VTIV UFI

Longs Outperforming Market: PESI XWG DESC FORD HBE SYNM NFLX PANC ARS VIVO GLW NSM BTUI MII

New Swing Shorts: RE EMC MVSN

Shorts Outperforming Market: CENT

Markets Reverse From Opening Lows

It was a good day overall for the market. Volume advanced across the board on the small gains. That is a positive sign after yesterdays follow-thru. Breadth also ended up positive after starting the day off negative.

I still do not have complete conviction that this market is going to fly, so I am keeping some cash on the sidelines. Which means I have been selling down some long term winners and buying smaller portions of new buys. I would rather not gamble at this point in time, with the market going through some moodiness.

But there were some good looking charts that came up intraday and tonight on my scans so that is reassuring that the rally could have some legs to make new highs. Speaking of new highs, they are well ahead of the daily new lows. That is also a bullish situation.

The market climbs a wall of worry, my friends. I see a lot of worried people out there that are scared of the Fed, inflation, gas, and another other thing they can think of. Stay positive and be prepared for all of lifes challenges.

The trends are all up. I can not argue with the facts of the stock market. The market right now says I want to go higher. But not too high too fast.

Until this trend changes, I remain net long with a bullish bias.

New Swing Longs: PLAY PRST HBE VIGN EZPW PANC CLWT CAMD MESA PFWD CRXL CYPB RFMD SKO AEP IRSN CMD

Longs Outperforming Market: BBSI EMKR WVCM LYTS DSTI NTES BMRN ESLR

New Swing Shorts: CENT COF BG ANPI

Shorts Outperforming Market: CNTF

Stocks On The Radar Screen: STS NMHC CERS TFSM TPC FTG JCTCF TTG VUL DW TESOF IAL AXR SYS

Stock Market Indexes Follow-Through

Stocks rallied across the board, led by the SP600 and Nasdaq 100 up 1.5%, on higher volume. This follow thru comes on the sixth day after the start of the attempted rally on 8/29 for the Nasdaq and the fourth day (8/31) on the NYSE. While volume did not have a huge increase over the Friday session, volume was higher none the less with good breadth.

Breadth on the NYSE was 13 to 5 positive and 2 to 1 positive on the Nasdaq. Lots of stocks participated in this rally including the Small Caps, Retail, Chips, Biotech, Building, Financials, and Telco stocks.

It was a good day overall. I made some small buys but mainly sold stock overall today. Leaving me with some cash to put to use if I get some more great looking chart patterns. Today did not offer any and I was sure there would be one or two out there. But there isn't. So I wait.

Negative headlines are still dominating this market and that helps support the case of why we are rallying. I was not even sure which direction we were going to go, even though ALL TRENDS WERE UP. I blame that on all the negative coverage of the tragedy on TV.

New Swing Longs: NWD LYTS GME GME.B LIOX BFR

Longs Outperforming Market: SGDE USLM AACC AAPL FLSH DCEL ASR ESLR ARRS NDAQ PETS DRRX CNET PYX

New Swing Shorts: NONE

Shorts Outperforming Market: EENC

Smaller Stocks On The Radar Screen: MXM DLA ITIC VCC FTG WEH ESC



Have a great evening. Aloha!

Happy Labor Day Weekend And Please Donate To The RedCross

No Market Commentary for the Labor Day weekend.

Going to get some surfing time in and have a nice BBQ Sunday.

Aloha!!!

New Swing Longs: ARS WIRE ARRS ROS

Longs Outperforming Market: SYNC DRRX PYX WSSI ASR

New Swing Shorts: PHRM SPH

Shorts Outperforming Market: JOE

Consolidating Gains

The markets were mixed, basically up or down .3%. Volume was lighter but still above average at the NYSE. The NYSE also had some good breadth today, giving the session a positive overall tone.

There is basically nothing changed from yesterday.

My data provider is down for some odd reason. It was working one hour ago and now is not working so I can not scan my charts. I do know that there were a lot of good looking charts in the scan and the numbers of stocks showing up in the scans were high. So I am sure there are some good longs to take tomorrow morning, but without my TCNet working I am lost for new ideas.

I wonder if there will ever be a day when something works all the time. Probably not. I should just kick myself in the behind for not doing my work after the market closed. Another lesson learned. I guess I rely too much on thinking TCNet should always work. Funny, I have gotten so used to them being so good that I forgot how often I have problems with InteractiveBroker.

2 AM Hawaiian Standard Time: Server is fixed!!

New Swing Longs: BLDR UHCP ENY ABGX BVN SVC BRKR GERN

Longs Outperforming Market: VIVO USLM UQM SIRF ASTE MINI WSSI RGLD ENER SPN RES INFA

New Swing Shorts: CSCD HOT SONC

Shorts Outperforming Market: JOE JCP STX

On The Radar Screen: GV OZN VSR ACAD DECT MDZ TTES IAL OCCF

Incredible Broad Rally on HUGE Volume. Correction Is Over.

What a hectic day today was, with a move into a new place. But who cares about that? Did you see the market? Wow is the only way to describe it.

Despite Katrina and all the horrible scenes coming from the south, the market rallied today across the board and did it on STRONG volume. I guess I should have seen this coming, yesterday, when I saw all the strong stocks show up on my scans after that early reversal from the lows. All the new swing longs that I had as new buys yesterday was the ultimate "poker tell" that something big might be about to happen. And it did.

Stock climbed until the close with the SP600 up 2.1% and IBD up 2.5% to lead the way. The indexes finished the day on volume that was very impressive. So impressive I am repeating myself again. NYSE and SP600 volume was the highest since June and the Nasdaq's volume was above average and higher than yesterdays. Very positive action. It shows that institutional investors went to work and accumulated stocks everywhere. Breadth was positive at around 3 to 1 on the NYSE, and 190 out of 197 of Investors Business Daily industry groups finished positive. Very impressive numbers. And to go along with all these numbers there were a ton of breakouts today in oils, biotechs, semis, and anything building/construction related.

Despite all of this, I heard from a friend today how sick he was of how bad the market is doing. I told him he watches too much CNN and should instead study the markets price and volume patterns. If you do that, days like today will not surprise you. Instead you will be ready for them and understand why they happen.

The constant negative news, terrorism, $70 oil, the Fed, Katrina, and just about anything else the media is droning on makes it appear the sky is falling. Nope. Despite all this terrible news, the SP600 is up 59% since the 2000 top?!?! Some terrible market. The SP500 on the other hand is down 18%. I find this incredible, considering my friends when asked how they think the market has done since 2000 think it is down 50% plus.

Follow the indexes, leading stocks, and sentiment numbers and you will not have to rely on the media to get your market advice. Then too someday you can release yourself from this constant negative tone that I hear and see everyday on TV.

All trends are up: Short term, Sub-Intermediate, Intermediate, and Long term

New Swing Longs: MINI HXM TDW NVR LAF PRAI ABIX CHB FCEL TXI MTZ RMIX ECOL TNB HAWK PYX MCY

Longs Outperforming Market: USLM APT SYNC CLHB IO ASTE ARD RES THE VAS HOS DGIN SIRF ENG SYNM SUPX

New Swing Shorts: ETR ACGL SMTC

Shorts Outperforming Market: CBRL

On The Radar Screen: FSTR DLA FADV CWBS GRVY GV TRCA WEL PLUG VSR PHEL TTES MPR REF

God Bless Everyone In N.O.and The Gulf States

There will be no commentary tonight, due to family and friends affected by flood.

New Swing Longs: HOS ANR WRES ESLR THE SYNM SPN IO NVDA MUSE HC UQM

Longs Outperforming Market: CPST MCEL MII ARD ASEI RES ENER RGEN FDG

New Swing Shorts: SGY HIT AHL MVK CONN

Shorts Outperforming Market: ANF STX CBRL

On the Radar Screen: HOM RTK CWG TESOF

Another Summer Day With Some Wind

The markets showed some nice resiliance by climbing the entire day after setting morning lows. Volume was mixed and not above the 50 dva so not too much to read into today.

There remains plenty of overhead resistance in the short term, along with an established sub-intermediate downtrend. The bounce today did help relieve short term oversold conditions based on the market oscillators. But the market is a bit confusing so not sure which way next direction is.

Natural disasters, crude oil, consumer debt, poor Michigan consumer numbers, housing bubble, and war. It feels like there is plenty of reason for the market to climb the proverbial wall-of-worry but the sentiment readings (AAII, bullish/bearish newsletters, and put/call ratio) are still at either high bullish levels or middle ground. So despite all the negative talk, it doesnt appear to be negative enough to establish much more than a short term bounce from these levels.

So we wait another day and see what tomorrow brings.

Sidenote: Ah Cramer! He is a little late with CPST isnt he? I gave you the reader that stock on 8/23. Guess what stock I sold a quarter of my position of AfterHours thanks to the "gamblers" bidding it up? If you guessed CPST you are right. Now collect your 50% gain in four days and send me a check.

New Swing Longs: IFSIA ASVI PAY FCFS FSTC CGPI

Longs Outperforming Market: CPST MSO SYNP SGDE USLM SPNC PETS LDSH PWR TWTC APT SMBI

New Swing Shorts: HIG MUR

On The Radar: ABIX TOFC FTG SPA DHIL

Aloha from Maui

CONGRATULATIONS EWA BEACH!!!! 2005 LLWS CHAMPIONS

GGGOOOOOOO HHHHHAAAAWWWWWAAAAAIIIIIII'''IIIIIIIII


WOW HOW AMAZING

CONGRATULATIONS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

EWA BEACH 2005 LLWS CHAMPIONS!!!!!!!!!!!!!!!!!!!!

50 Day Moving Average Failures; Light Volume

Even though volume was light a very negative developement occured today. The 50 dma of the Small Cap, Nasdaq, NYSE, and Dow have been recent resistance. The Dow already followed through failing to regain this line and now the rest of the indexes have failed at this line. The close on Friday in the indexes show a confirmed failure to regain the 50 dma and a bearish break of recent support. Their was a slight positive to today's down action. The volume did decrease from yesterday and is well below the 50 day volume average.

While there are still some good stocks out there the better charts are shorts and the market is still acting very poorly. Weak sentiment numbers and Alan Greenspan was the highlights today for the "reason" the markets went down.

I tell you what. I am not sure if anything could happen in the US economy to make people think it is a good economy. For one reason the newspapers and TV are not going to help. Something tells me that if we had a Democrat in the office this economy would be on the front page of every newspaper as "An expanding economy with low unemployment, and tame inflation." Even with oil this high. I am too young to remember, but I am sure if I do some analysis about the media and the economy during the Reagan years I would find the same thing: Constant Negative Headlines.

If you are staying disciplined this year by cutting losses, taking gains along the way, and keeping cash on hand you are probably at worst flat for the year. Which is better than the markets current return of -3% for the year.

Until Labor Day take it easy. You know the market will.

New Swing Longs: SMBI SYNP CTCH NOVA ININ

Longs Outperforming Market: CPST PRLS MSO

New Swing Shorts: CAJ BEV USTR HARB TRMB ENB KNSY STX CBG AACE

Shorts Outperforming Market: CHS WIND WCI HHS MSA FED NCTY

Stocks On The Radar Screen: CTTY PNRG USEY HBE CLDA DLA

Was The Market Open Today?

All I have to say is I hope it isn't going to be this slow next week. If it is, I am not sure how I can come up with anything new to say that I have not already said. It gets old saying the same thing over and over. What have I been saying? Read the last 20 blog post.

At least for a boring day, it was an up day with positive breadth. That is good. And we did not fall on higher oil. Another slight positive. But the most positive aspect about this market is that you can catch up on your sleep. If you can't beat them, join them. Take a nap with the market. It will probably be at the same close it was at today, on Monday.

Now, you want action? Look at the moves today in individual stocks. There is a lot of positive charts out there, even with this boring market. So if you want action, here it is.

New Swing Longs: AMK EME MSO RSYS PANC NEOL TWTC LF CPWR HOMS BRKR FSTF

Longs Outperforming Market: CWTR USLM PESI BMD ANX CRUS

New Swing Shorts: NLC MSA TOL ITRI FITB

Shorts Outperforming Market: NCTY

Distribution Day On Heavy Volume

Another intraday reversal for the indexes show, once again, how weak this market is. Markets reversed hard and volume really picked up as the indexes started their intraday freefall.

This gives the market another distribution day. If you have been reading my blog, you know that caution has been urged for a while now but today was proof positive this market is not done to the downside.

Oil and the Fed Reserve of NY issuing a letter about banks problems with derivatives were the "usual suspects" for why the market fell. No matter what the reason is, make sure you have a disciplined cut loss strategy in this negative news environment.



New Swing Longs: RFMD PSSI SBGI BNN CVTX PESI VCC

Longs Outperforming Market: CPST MCEL MII BCRX

New Swing Shorts: SFC GFIG XLV CBT CHCO NKTR PTR GPN CDE SONC EAT CBRL. The whole restaurant sector broke hard today.

Shorts Outperforming Market: WIND VSTA VRSN

Another Dull Day

The Nasdaq was lower on lower volume and the NYSE was lower on higher volume. Volume was skewed by Lucent's (LU) volume, so not sure you can call NYSE's higher volume a distribution day. No matter what though it was a boring day witht the indexes all changing .05% or less. News of existing home prices falling 2.6% didn't impact the market, because the homebuilders already priced the news in the past three weeks.

It is still hard to tell if this is base building or a possible intermediate downtrend trying to start in the indexes. So play it by year and be prepared for a move in any direction by having strict buy and sell rules.

The good news, besides the indexes being near their 50 day moving averages, is I am starting to find some nice chart patterns in individual stocks again. It doesnt mean a rip-roaring bull is coming back but it does support my bounce theory in the short-term.

Not much else to add today that you can't already read in my past 10 blog post. The indexes sure are not providing any fireworks to talk about.

New Swing Longs: BTUI BCRX IRN CPST COHU GERN MDRX ELX CDN

Longs Outperforming Market: BCON RMD ACR ANX CVO SYNC SUPX FLOW KOPN VAS BBSI

New Swing Shorts: FRO WIND BCF PBT BCR MAA VSTA PLCE

Shorts Outperforming Market: GKIS TTC

On The Radar Screen: PNRG OPTC IIN CTTY RNAI EGBN

Sleep Little Market, Sleep

Another wild and crazy day for the market! Not. Let's see, the past five days, the SP has changed a whole 2 points. And volume has been very low, under the 50 day volume average. I don't know about you but if that isnt boring basing I don't know what is.

We are at the 50 dma for the Nasdaq and today did show an increase in volume for that average. That could produce that bounce I was talking about. But if volume stays this dull on the bounce, I will have to think the bounce will rollover and a break of the 50dma could happen. But I can not predict the future so I will game it both ways.

The market was pretty dull, overall, except the intraday drop off in oil. But that market is so voaltile recently it could be at new highs tomorrow.

The real action came in smaller medical stocks. Eyetech (EYET) was bought by OSI Pharma (OSIP). Not a big deal. But the big deal for me was Panacos Pharma (PANC). Go read my weekend blog. As you can see, I had PANC ready to buy this morning or might have already takend a position in it. Unfortunately, I did the former and not the latter. PANC came up on my screens around 10-11am EST on Friday and I did not act on it at the time. Why? I did not completely fall in love with the daily chart at the time. Only after reviewing the daily at the end of the day did I fall in love with it. Well, when I woke up, the stock was up 55%. Did I kick myself for not buying it on Friday? Yes; just once. Why just once? Because the chart did not look right at the time it came up on my scan, I played my game plan correctly. I risked a nasty reversal that could have really hurt me. You cant predict the future and I had no clue it was going to be up 55% in the morning. So I did everything correct. The chart only looked perfect after the close, after it rose another .06 late in the day to create a very nice chart pattern. So I did everything right. Never get upset about missing the big one. You are going to miss a lot.

New Swing Longs: LDSH ORBK CRUS

Longs Outperforming Market: BCON KNDL DGIN ADST SBTV ACR

New Swing Shorts: PP IPG KSWS

Stock On The Radar Screen: ALO PANC MVCO IRSN PESI KTCC

Aloha from Mauifornia! LOL

End Of August Summer Time Boredom

The stock market averages were basically unchanged today, with some up .1% and some down .1%. Volume came in near the lowest of the year, as we enter the summer. This is your typical summer time August lull until Labor Day.

It appears the sellers took a break and buyers are sitting on the sidelines waiting for one side or the other to take control. In the meantime, however, the markets did reverse intraday today, again. This is like the 3rd of 4th time in the past week this has happened. This is bearish and not bullish. Today's blame is on MRK as the poor drug company was ordered to pay a huge settlement in court on Friday. MRK is appealing the decision. The intraday reversal in the broad index after this ruling indicates sellers are in control of this market, as bad news is bad and good news is not good.

The markets are near their 50 day moving averages. So a bounce is very possible. Price and volume action, however, will let us know which way the market wants to move from this very important support level. If prices rebound on decent volume: Alright. If price breaks down on an increase in volume: Uh Oh. Either way be prepared and have a game plan for both scenarios.

New Swing Longs: CCK EXAR PANC ADSK MII SYNC

Longs Outperforming Market: VRTX NRPH PTG

New Swing Shorts: PPH STJ HRB CHS SCSC MRK PDCO

Shorts Outperforming Market: HIBB

Opportunity Missed: REDF. Had to cut loss, due to rules.

Leadership Changing

The stock market indexes churned today on lower volume. Which is a welcome sign considering all the recent distribution days we have had. However, todays action was still quite negative all around.

There was poor breadth, low volume, and an obvious rotation of money into defensive sectors. Did you see the Consumers, Food, and Tobacco stocks today? I did and the obvious standout to me was MO.

Altria (MO) broke out of a beautiful long term base and Reynolds (RAI) did too. Along with that all the other defensive stocks are setting up in very nice bases. This could give us yet another sign that the current uptrend is in fact over.

This bounce is weak and if it continues it will only provide some protection from all the ugly and sloppy chart patterns on the daily and weekly charts. Most of the old leaders charts are broken and the rotation is obviously into defensive stocks.

Short-term and sub-intermediate trends remain down, the long-term and intermediate remain up.

Keep tight cut losses and new purchases into "dip" stocks very small.

New Swing Longs: MO CHRS CVO

Longs Outperforming Market: RGEN MNTA ASEI ADST

New Swing Shorts: FTD TSA SEE CBT BBG TTC LGBT BKS WMGI

Shorts Outperforming Market: CNTF LEND

Under The Radar Screen: CTTY SYNC GSX SNG OPTC BL

Aloha from Maui

End-Of-Day Reversal Indicates Distribution; Not Accumulation

If the Nasdaq and Dow were up, how could it be distribution? It is distribution cause the markets ran up, topped out, and near the end of the session closed below the intraday support levels. That in itself might not indicate pure selling. The tell then was the volume. Volume picked up over yesterday. Since it initially should look like accumulation, you have to then look at the intraday tape action. And all the indexes closed in the lower half of their daily trading range. Coming off of all the recent distribution days, this is called churning. Churning is when the markets go nowhere intraday on high volume, after suffering some pure distribution days. This now gives the current market four distribution days in six sessions. This should be all you need to know about current market conditions. We are about to hit bear mode for a little while.

More charts blew up today: PLAB and TALX. This along with all the other blow-up stocks I have mentioned should help solidify your conviction to raise cash, keep longs small, and if you are experienced look for some shorts.

Oil fell 2.80 and people were talking about why the market didnt go up. Hello, the market has been rallying thanks to retail, home builders, and OIL stocks. The oil stocks have been your market leaders. When the market leaders crack -- like oil stocks are doing now -- the market follows. So when oil falls, the market will fall. Just like it rose the past 3 years with rising oil prices.

Markets are not bullish right now, no matter how much you want them to be. Be careful out there.

New Swing Longs: VAS MNTA RGEN SUPX ADST ECOL

Longs Outperforming Market: AIX AEIS LOJN KNDL

New Swing Shorts: KMP SMTC TK HURC

Shorts Outperforming Market: PTC EENC CNTF OMM

Aloha from Maui!

Market Finally Cracks; No Surprise Here.

The stock market finally cracked today, on an increase in volume. Indexes fell anywhere from 1.5% to 1.1% with volume rising as the market fell. This is the third distribution day in the last five sessions for the Nasdaq. That is not a bullish situation for anyone looking to purchase new longs, since 3 out of 4 stocks follow the general trend of the market.

What is the good news: The SP600 and Nasdaq are very close to their 50 day moving averages. This would be an ideal place for a bounce. If the bounce comes on lower volume it may not hold and if the indexes break through the 50 day moving average the next support is the 200 day moving average. So a short term bottom may be near. However, a lot of bulls (newsletter survery, AAII poll, and the sheep in #daytraders, #activetrader), ugly charts (DELL, CSCO), topping charts (BCON), and distribution days in the indexes indicate a bounce may not hold.

The next best thing would be a long sideways consolidation lasting a couple of months that breaks out to the upside. That would create tons of beautiful bases in stock charts. Chances of that are low, I would assume, now that oil finally matters.

I would be careful here, if you are buying stocks. The market is not presenting a lot of great charts to buy and stocks like DKS are a dime a dozen the past week. Keep cash high and wait for this downtrend to run itself out.

New Swing Longs: MRY

Swing Longs Outperforming Market: BCON ANX DCEL NR

New Swing Shorts: TWI TJX CATY JCP ANF HIBB EENC BEBE

Swing Shorts Outperforming Market: CKCM AEOS

Under The Radar: ADST TVIA ROS ELT

Very Low Volume Rally

It is difficult to make much out of a day like today. But since that is what I do, I will. The market ended the day higher after spending the early hours underwater. Volume came into the market as it rallied but it was still well below the 50 day volume average. This indicates there was not a lot of enthusiastic buying by larger funds. We will see in the coming days which way the market wants to go.

If you need to read anymore into the markets current condition, read the past five post in the blog. Also remember to keep some cash on hand, while you buy and sell some stocks.

New Swing Longs: MSTR JTX WRES SKX DCGN AEIS

Longs Outperforming Market (up 5% or more): BCON ASEI PRLS SBTV GNSS CUTR TAGS BMD RCCC FLSH

New Swing Shorts: PL CME VLCCF

Helpful reminder: ALWAYS CUT YOUR LOSS, NO MATTER WHAT, WITH A CLOSE BELOW THE OPEN OF THE BREAKOUT DAY. SO BASICALLY IF YOU BUY A STOCK TODAY AND TOMORROW IT REVERSES AND CLOSES BELOW THE OPEN OF THE BUY DAY, YOU MUST SELL NO QUESTIONS ASKED.

Under the Radar Screen: AOB IIN API AEZ

Aloha from Maui

Gap Down, Stay Down

DELL's earnings Thursday night caused the breakdown on the indexes Friday, dropping the Nasdaq by as much as 1.5% intraday. Volume rose on the nasdaq, albeit less than 5%, and dipped on the NYSE. This gave the Nasdaq its third distribution day in past four weeks. While the distribution days have not been climatic selloffs, they are selling stocks none-the-less.

More stocks became casualites in the blow-up category (ie, IPII) and few charts are presenting good buy opportunities. It remains time to keep cash heavy and wait the market out till it decides to make up its mind.

Without a doubt, oil is being linked as the cause for this. I will tell you this, if the market looks ahead by six months, the market is telling us oil at $80 is coming. If the current price action has to deal with the "current" move in oil, then history has folded its hand on its past historical guidance of oil prices and market movements. Which does not surprise me, since there have been so many crazy things that have bucked recent history. Interest Rates not rising on the long end while Greenspan hiked rates is the first to come to mind. But that was due to low inflation--without food, lodging, and oil. Wonder what inflation is going to look like 6 months from now?

The markets are still in a downtrend on the short-term and sub-intermediate trends and up on the long-term and intermediate trends. However, a few more days of distribution, to go along with all of my ugly charts will confirm that we could soon be in for an intermediate correction.

One other item of interest: I did not report Thursday night something that caught my attention. The Investors Intelligent Survey of Newsletter writers shows 59% Bulls and 19% Bears. These two numbers are at extremes and to see people get more bullish the past week as prices drop confirms that there is too much bullishness out there and not enough fear.

If you go back to the April/May bottom and read my blog comments you will see that I saw this pattern IN REVERSE. So while everyone stays bullish at these levels, I remain extremely cautious. Better to be safe and alive, than sorry and broke.

New Swing Longs: BE CAREFUL WITH NEW BREAKOUTS: MDG AAPL NVDA

Longs Outperforming Market: RCCC ASEI CPTV SVR NFLX WHR

New Swing Shorts: CNTF CTHR WPSC CKCM LB TRMM FMD CREE

Small Stocks To Watch: INT WEX ITWO JAMS TAGS CVV OPTC

Market Rebounds On Lighter Volume

Stocks reversed today, across the board, unfortunately volume fell with it. That is the opposite of what you want to see. Yesterday volume rose, markets fell; today volume fell, markets rose. The market was very volatile today going higher, lower, then making a push higher. All of this recent action in the indexes, along with all of the individual stocks BLOWING UP resolves my faith that staying heavy cash is the correct play right now.

Charts have turned choppy, ugly, and down right negative during the past two weeks and today they did not get any better. With fundamentals being the best we have seen in corporate history it reminds me of a history lesson: Technicals and Fundamentals tell you when it is time to buy, Technicals ONLY tell you when it is time to sell. Why? The fundamentals and story is always the best AT the top. Only in hindsight will you know that the earnings were going to top then.

New Swing Longs: CVCO ASEI EPAY ACR KNOT

Also a lot of individual gold charts look great here. Some are a buy now some need pullbacks or more time basing: RGLD GG GLG LIHRY ASA CDE EGO NTO VGZ AUY MNG ASA KGC SLW JRCC GOLD. Keep an eye on the Gold sector; it looks primed and ready to go on a move.

Longs Outperforming Market: BCON INFA PRLS ANX

New Swing Shorts: NAHC EAT VLI RARE TNE

On The Radar Screen: INT WEX

Disaster DeJours past two days: MED DATA. Nothing I could do about DATA, I took my 16% loss from my 7/15 buy. Another reminder why I diversify so much in my accounts with many great looking charts. MED on the other hand shows the importance of cutting all of your loss when the stock closes below the open of the day of the breakout. By cutting my loss by the close after the nasty intraday reversal I took a loss--almost 9% but remember this is on a small portion of my account and risk/reward was there 4/1--but saved myself a total gutting by losing 35% or more on the trade.

Not too many people will talk about their mistakes in the market. I do because I think it is a very healthy and important thing to review BIG mistakes, instead of just talking about all of your BCONs.

The stock market is like poker. Everyone thinks it is easy to enter the WSOP and win 7.5 million dollars. But if you are like me, you will enter over 500-1000 tournaments just to make one final table. What does that have to do with the market? A lot. The psychological strength it takes to continue to battle on has to be enormous to deal with all the bad beats. The same thing applies to the stock market. It takes a lot of time and hard work to consistently make money. Anybody that thought the market was easy and started to buy stocks the past week now understands how complicated and rough the going can be. There are going to be a lot of bad beats in the market but if you are confident and continue to play and study the market you will too make that final table and grab a piece of that 7.5 million dollars.

That doesnt say much about my poker game, btw, losing so many tourneys but if you ever want to meet me in Vegas and go Heads-up or play a ring-game I welcome the challenge. :-) j

ALOHA from Maui

Nasty Intraday Reversals On Huge Increase In Volume

The stock market started off strong and looked to be going higher until around 1PM or so. After that, it was straight down. Volume increased sharply across the board. Marking a nasty distribution day for the Nasdaq and terrible reversals for the other indexes. Even though the NYSE and SP600 were up for the day, the intraday reversal on a big increase in volume might as well mark these as distribution days also.

These kind of intraday reversals can cause major psychological damage in the short term. Therefore, I would sit this market out if you are a new investor or cut your long exposure a lot if still very long. The best thing to do when the market gets like this is to just keep a heavy level of cash or be one heck of a stock picker.

Nothing says that we can not all of a sudden reverse upwards and start this uptrend all over again. But for two weeks now I have commenting on all the bad charts, blowups, lower New Highs on the 52-week high list, bad breadth, and how there is just way too much bullishness out there. Well, it finally hit the whole market today. Now is the time for those perma-bears to now step out of the closet and say I told you so. Yeah, you did... in April and missed out on over 50 stocks that made 100%+ moves since then. Way to go, perma-bears!! :-)

Why did the market reverse? I am sure you think it was oil. No? How about earnings season being almost over. Dont like that? Uhm....summer vacations?? Well, whatever you think the reason was, sadly it was not. The market looks ahead three to six months in advance. The oil, earnings, vacations, or whatever it the reason is not the real reason. We sold off today because some BIG funds do not see value in holding stocks at this juncture. There were more sellers than buyers; bottom line. We can blame oil all we want but on a GDP level we do not consume as much as we used to. Oil is simple the effect not the cause of this market. If oil was $50 today, CNBC would have given you something else to believe. Thanks CNBC!

With the markets up 100%+ since the October 2002 bottom some short term profit taking makes sense. We shall see if we will be up 125%, 100%, or 75% from Oct 2002 bottom, by the end of the year.

Sub-Intermediate trends in all indexes is now down, along with the short-term trends.

Short Term: Down
Sub-Int: Down
Inter: Up
Long Term: Up

New Swing Longs: LMIA RCCC CKH ARS

Longs Outperforming Market: GMXR ASR ELTK TEC USLM

New Swing Shorts (by as close to pivot as possible; NO CHASING): HDL RGS USMO DSL HANS CSCO LGF SNDA CYD. Take a starter position. Then monitor for additional entry or a cut loss.

Shorts Outperforming Market: SNHY

Tiny Longs Worth Watching: MDII MANA GEAC MSON

ALOHA FROM MAUI

Fed Raises Rates Again

For the 10th consecutive time, the Fed has raised rates a quarter of a point. The Fed continues to fight inflation with its gradual steady increases in interest rates. It looks as if there are another two more hikes in store, at least. Best case scenario is seven more hikes from the Fed.

Where do I get that number? Why from Mr. Richard Yamarone of Argus Research Corp. He believes it will be at 5.25% before the Fed declares the fight against inflation is over. That would be great for stocks, if that is the case. Since 1994, everytime the Fed hikes rates the market moves higher and visa versa when the Fed is easing.

The stock market bounced on an increase in volume; not a big bounce, however, and not on a big pickup in volume either. But an increase in volume on a bounce, after a lower volume decline is positive action if we want the market to start to go higher again.

Besides that, stocks were pretty boring today. Small caps lagged again and Big Caps lead. I know it is a common statement but "it remains a market of stocks." There are great stocks out there but not a lot. We shall see what tomorrow brings.

New Swing Longs: UBET WIRE PRM RCOM TFR BTUI SLXP

Longs Outperforming Market (up 5% or more): SYKE OLGR BBD USLM TEC MCF

New Swing Shorts: SNHY PCLN CNO L

Shorts Outperforming Market (down 5% or more): CRYP INPC

ALOHA

Waiting For The FOMC Interest Rate Decision

Nothing has changed today, from Friday. The indexes dropped and volume rolled in lower across the board. Just what you like to see in a normal pullback in an uptrending market.

The first logical support for all the indexes is the 50 day moving average. Since this drop is coming on lighter volume, a nice bounce off that line with a pickup in trade should help give hope that the rally can continue. However, a failure of that average on volume will concur what the recent drops in the leaders (Homebuilders, REITS) have already given--a sell signal. And to be quite honest all of the REITS on daily charts look like short-term crashes. These moves in the past two days, in every stock in the REIT group, are extremely violent to the downside and on heavy volume. Housing slowdown finally??

There is not much more to add to the commentary today. The market drifted lower on light volume, waiting to hear what Mr. Greenspan has to say about inflation, rates, and the economy.

New Swing Longs: MED VC SGRP

Longs Outperforming Market (up 5% or more): BCON!!! MCEL TEC GBND OLGR CPTV ELTK CERS ENTU

New Swing Shorts: SHO ZIPR WCI BMHC and the whole REIT group on low volume bounces to recent breakdowns. Nasty ugly charts everywhere in the REIT group.

Shorts Outperforming Market: INPC ZGEN

ALOHA

Indexes Now in Short-Term Downtrend

Friday confirmed that the recent topping action in individual stocks is signaling for a move down; the SP600 with its 3.8% move lower leads the list. There was negative breadth, all around, and well over 90% of the Industry groups I track were down for the day. That is a poor number.

This could provide a reason for a short-term bounce in the next couple of days. But with all short-term trends being down after such a big run-up from April, more downside action would be welcomed to shake out the new, late longs and create new bases for stocks to breakout of. Another sign of more downside is all the poor looking charts the recent great stocks have turned into. With that too, I am getting a lot more shorts coming up with better risk/reward potential than I have with my longs.

A positive sign that the downtrend might be contained would come in the form of lower volume on the way down. So far, so good, as volume did come in lighter yesterday, for the Nasdaq and NYSE. It seemed as if funds did not dump en mass, and instead focused their selling on the hottest of hot sectors: Homebuilders, Retail, and REITs. The good news is fresh breakouts from first stage bases work well, while breakouts from eratic, sloppy, and late stage chart patterns continue to disappoint after this big run-up from April.

Also one other point: BIDU!!! what is this? 1999-2000. I need more facts before I declare this to be in the bubble category. But it sure does look speculative. YIKES! Stay away, for now, unless you have "inside" information. Which I doubt most of you have.

New Swing Longs: LTON PTG OLGR GBND REDF VSAT TMNG VSAT ASGN DVD. Most of these are very speculative. So keep a good eye on them. Why? Read below.

Longs Outperforming Market (up 5% or more): BCON!!! NRPH CPTV

New Swing Shorts: GKIS TSM GFIG CRYP INPC QSFT ZGEN FHR PSA JOE MAA CQB RWT WPO. Most of the stocks mentioned are REITS. I will not short these boring stocks, but if you do short them it should provide some short term gains.

Disaster Du Joirs of the Week: SCVL PWEI. This is why you watch stocks closely. Even though both BLEW UP, I only got hit with a 4% and a 15% loss respectively. Both dropped over 25% from their highs, but by buying right I ended up with some small bruises and nothing more. They were nice when purchased, now they are trash being taken out. Another great example of why you should never load the boat with smaller less attractive fundamental issues. Cheap stocks always stink, unless they are going up. Cheap stocks are cheap for a reason; they cost what they are worth.

ALOHA and have a great weekend!

Market starts pullback

The pullback I have eluded to may have finally started--It is about time. With the retailers leading the way down, poor breadth, and closing near the lows of the day the indexes looked really weak today. But, all in all, it wasnt that bad of a day. Volume was lower today than yesterday, on the Nasdaq, NYSE, and Dow. However, volume on the SP600 grew as the index lost 1.4%. That is its first distirbution day this month. As the leading index in this rally, it will be important to watch if more of these days pop up to signal if a correction is coming for the index or just a normal pullback.

All trends remain up, since the October 2002 bottom, except the Dow Jones short-term trend which today turned latreal.

New Swing Longs: KOPN SJR ENY CMX NWRE

Longs Outperforming Market: CENT BOOM TRGL

New Swing Shorts:

Slow Market Day

Though it seemed slow, which it was overall, the Nasdaq still traded more shares than yesterday. You could have fooled me, though. Anyways, the markets did not do much today, barely moving .10% up or down. The action in individual stocks however was different today than yesterday. I had to sell down my nicest charts from the rally today and have reduced more positions today that have ran up too much short term.

Small oils were weak today and Gold was strong. Could that mean, with gold rising, that we are going to have inflation? I would think it would start showing up in the data soon, seeing the short and long term bond yields finally start rising. But I am not sure if we are going to get a lot of inflation. At least not the kind seen during the Carter administration. Also, I would think this inflation would cause the Fed to keep hiking rates and that can only be good for stocks. Why? Because, history has shown, since 1993, every time the fed hikes rates stocks rise and when they reduce rates stocks fall. Why? Because the market does the opposite of what you think it is supposed to do.

However, currently, the market is giving poor risk/reward ratio for new positions. Charts are getting sloppy, stocks are slipping a little, and some stocks are going parabolic. This is leaving few stocks at safe buy points. A pullback in the markets would help create good bases for the next round of leaders to break out of. If we will get one, the way this market is acting, I dont know. However, if you must go long now, keep a tight cut loss and dont "load the boat."

New Swing Longs: RGLD ABX ECIL ECTX ANSS ORA

Longs Outperforming Market (up 5% or more): NTES ANX ENG BMD TGE ELOS CTRX GOLD

New Swing Shorts: FRP NLC VNUS WMI PXD

Aloha!

SP600, SP400, RUSSELL Close at HOD

The indexes above closed at the HOD and the NYSE, Nasdaq, and SP500 came very close. Volume increased across the board, a positive sign in an uptrending market. Energy, Metals, Gold, Insurance, and select Medicals were the positive movers today, along with big cap tech. Overall it was a very strong day and there is not a lot of negatives. Unless, you include the small blow ups today (TYC, CNXS, CUTR, etc...) in individual stocks.

Which brings me to my next point. I am seeing some charts getting too extended from their original breakout, along with more minor blowups, than I saw at the beginning of the rally. This makes me cautious on much further upside momentum; but, hey, have I not been saying this for three weeks or so.

No matter, however, you have to go with the trend and the trend is very up. So much up, in fact, that the SP600 and Nasdaq are both up over 100% since the October 2002 bottom. As long as I have charts moving up on strong volume, coming out of sound bases, I will remain bullish. Even though it feels like a pullback is needed.

All trends remain up, since 2002.

New Swing Longs: CPN GOLD NATR GRS GSX ESMC

Swing Longs Outperforming Market (up over 5%): ENG VLFG PWEI TLF BMD CWTR COGT PANL BCON MCEL AMED

New Swing Shorts: IWA MGAM MAS

Aloha!

Low Volume Continues

There, once again, is not much too add to this market after today's session. Biotech, small cap and large cap oil led todays market action with some nice gains. The techs and retails were weak today. Markets remain the same with all trends being up since 2002.

Lots of people keep calling for the markets demise but it is hard to stop momentum no matter how hard you try to talk it down. I am a bit nervous with the amount of small stocks moving higher but I have to remember same thing happened in 2003. Also more stocks trade on the exchanges today than they did 5,10, or 100 years ago.

All trends remain up for all the indexes and until something changes I have to remain bullish. When momentum stalls and we start getting some distribution days on the index then I might listen to the bears case a little harder. But, for now, oil at 62, interest rates, China, terrorism, or whatever it is the bears are worried about does not matter to this market. Therefore, I will continue to ride the trend till the trend reverses and let other people try to predict where we will be a week from now.

New Swing Longs: PWEI TLF BNT SCO ELOS ATLS COGT MNST MCEL VITA LNG ELT PPX

Swing Longs Outperforming Market: XWG BCON GEOI WEL ARD TMY PETS BOOM TALX CTGI SGDE CPTV CUTR CFK ANX NICE IDIX OPMR WVCM TEC VLFG

New Swing Shorts: HRAY VIAC


ALOHA!

Weekend Trades (No Commentary)

No commentary this weekend as the market started a small pullback and did not do much else on Friday.

New Swing Longs: ARD KLAC USNA MRGE SVR MFE

Another Buy Opportunity: SGDE

Positions Outperforming Market (Up 5% or more on the day): MIDD KNDL FORD STEM WEN OPMR NDAQ NGAS NTRI CUTR TGE RT ABP GERN TRGL VDSI ENTU

ALOHA!

Corporate Earnings at All-Time Highs

Oh yeah, the economy sucks. Yeah right! I am so sick of listening to the media establishment always casting doubt on this great market. The consumer confidence numbers, no matter what poll you look at, would make you think we are in a recession. Hardly; the economic numbers look great, jobs look good, GDP is growing faster than our European brothers, the stock market is heating up, and the deficit is shrinking. What more do people want? I know. They want a housing bubble to pop, terrorist to scare us from traveling, and just about anything to make a Republican Whitehouse look terrible. No matter what your politics are, you should not ignore the great stock market right in front of your eyes.

That is my rant for the day.

The SP600 hit all-time highs, corporate America's earnings are hitting all-time profit highs, the SP500 and Nasdaq are at their highest level since summer of 2001, and housing stocks like MTH keep proving the "top" to this housing "bubble" isnt here yet. All reasons the long side is the right side right now.

Whether this market is going to roll over today or next year, I dont care. The most important thing to know is what the market is doing right now and all trends are UP UP UP. This will end one day but not today Thursday the 28th of 2005.

New Swing Longs: VSEC MINI NTGR MDTL PRST CNQR FLR AACC FLML DRAX BLKB BEAS NWD ENI MTSC PLUG CDN

Swing Longs Outperforming Market (up 5% or more): FOXH NTRI ANSI ERS SSNC CHCI DIOD CUTR NUVA SBAC QUIK WEL GTF

New Swing Shorts: DJO TBL HTCH LZB PGI WMI TTMI KWD

Swing Shorts Outperforming Market (up 5% or more): WOLF GMR

Aloha!!

Another Good Day For The Markets

The market continued to flex its muscle on Wednesday, finishing the day higher across the board on an increase in volume. This is what you like to see in an uptrending market. I continue to see biotechs and select medicals outperform the market. The telcommunications sector has also been heating up recently.

My point I want to focus on tonight is Regulation FD. After reading IBD, I got to thinking how much I hate this stupid regulation. No matter what, whoever bought Enron, Global, Tyco, Adelphia, and others, were going to get hurt anyways. Sarbanes Oxley and Reg FD are not going to solve it. There was a time, before Reg. FD, where you could see a chart sell off slightly before the blowup-You still see it today, sometimes. Now what you have are implosions out of nowhere. Just going through my charts tonight, I notice tons of upside breakouts and downside breakouts from consolidation periods. These types of moves gives the investor no safe place to take an entry. If Reg. FD did not exist there would be more of an opportunity to jump on the breakouts before the breakaway gaps. Oh well, looks like government has helped us, once again, by interfering in our free markets.

Bottom line: ABRX!!!! where did Reg. FD and Sarbanes Oxley come into play with this one, for investors????

New Swing Longs: MWP VLFG CTEC BLT JVA HLND GNVC RGEN FON

Swing Longs Outperforming Market (Up 5%+): TGE CERS WVCM RATE GTF XWG TZIX SIRF NGAS QUIK GLW

Disaster DeJour of the Day: ILMN

New Swing Shorts: ENWV IRIS PHLY WCG RCL ROK BUD CAJ BYD

Aloha!

Positive Earnings and More Price Gains

I don't have much to add about the indexes situations. All remain in an uptrend on all time frames. I guess, that is all we need to know. Base building or topping? Whichever one it is, remember to have a great cut loss strategy. But everyday this keeps going up I remind myself of 1994-1995 when the Fed kept raising rates and the market kept moving up. Is history trying to repeat itself again? Naw; it can't be.

New Swing Longs: LAYN CTGI SGDE CMCO APCC AAI CNET TPTH NRPH STFC WVCM

Swing Longs Outperforming the Market Today (Up 5% or more): BCON ELTK ONNN DESC NFLX MDRX DATA

Stocks I Am Watching For Right Entry: PLUG

New Swing Shorts: CBU AGR AUDC BBX OMM GMR SCSS

Not sure why I keep going short or attempt to. With a market this strong, going short is just the wrong play. Your best bet is to wait till the market rolls over then go short. Going long is the play, right now.

Aloha

Markets Pullback

It is nice to see the markets start to take a rest. After this very strong bullish phase of the market, there has been a rash of uber-bullish talk recently. Even though, the terrorist talk does add a "wall of worry" to climb, the majority of market talk has been, recently, crowded to the bull side.

Nothing changes, long term or short term, all the indexes are still up. However, a move down tomorrow will throw the Nasdaq into a short-term downtrend. All other trends, on the other hand, remain long and strong.

New Swing Longs: LABL THRX FLSH TRAD HYC NFLX CHU

Swing Longs Outperforming the Market: TGE FORD CERS XWG VIVO ENG NGPS BCON ABP ANX DESC WHR AWGI OFI GTF

Swing Longs Worth Watching For An Entry: MED

New Swing Shorts: DRYS TSU TRI GEPT

Swing Shorts Outperforming Market: JAKK JNPR EMAG(setting up again)

I never give my sells or covers, since I do not get paid for this. However, a free look at the stocks I sold for profits today should give you an idea of things I look for in taking profits. ONNN DSTI ANGO FRGO

Aloha!!

Me and my girlfriend 

The SmallCaps Is Where The Action Was At.

You think the market was boring on Friday? Wrong. The SmallCaps were up 1.5%, while the other indexes did basically nothing.

I have been enjoying my weekend so am keeping this short.

New Swing Longs: RES NOBL WFT NGAS ANX VIVO RIG GW NOV RT TEU YRK AX REY CVV SRLS EXPO

Swing Longs Outperforming Market: GEOI ABLE GNSS INFA ICON ULTI CIB XWG VLCM MRTN PHCC HHGP ABP VPI EMKR THE

This is why you play the individual charts and try not to worry about all the noise, whether it is bearish or bullish. I do not have enough money to keep up with all of these wonderful stocks that are providing gains that are just plain beating the market averages this year.

I just finished re-reading (for the 6th time; 5 times in last 5 yrs) "Reminiscences of a Stock Operator" by Edwin LeFebvre. Thank God I did. Words written in 1923 could not be more true today than they were then.

Aloha!

Distribution Day; Sell the News

Stocks finally started their retreat that has been in the workings for a week--the negative breadth, lower new highs, VIX 10-yr lows, high bullishness, and speculative ugly charts breaking out. The SP600 fell the hardest losing almost 1.7% and the other indexes faired just as poorly. Volume climbed across the board, as stocks retreated. This gave the indexes their fourth distribution day in the past four weeks. Pauses are normal in a good bull market, even though they sometimes look like something worse. This pause is probably just a short term top. No matter though, having a sound strategy to protect profits will keep you alive if the markets start to really pullback.

New Swing Longs: MRTN OXPS KONG DATA OFI SJR VPI USLM VRNT FDG ENER IDBE

Longs Outperforming Market Today: XWG ERS CHRT STTS BTJ

New Swing Shorts: CTAC IGT MDCO JAKK LRCX MNC

Shorts Outperforming Market Today: VRSN

Four Year Highs For Nasdaq and SP 500

Well, they did sell the earnings but what followed was something I was not expecting at all. Stocks had a reversal around mid-day after Greenspan's speach leading the indexes to close near the HOD and volume surged across the board. Nasdaq volume was up almost 20% higher than the day before. That is the kind of action you like to see during uptrending markets. The Semiconductor and Biotech stocks definitely were the outperforming groups today with many stocks up a lot. AMGN, GENZ, CELG will show you the strength in the Biotech group.

GOOG reports earnings tomorrow--lets see how that goes.

Even though I have been feeling bearish recently doesnt mean my portfolio isnt still dominated by longs killing the market averages. I remain long as long as the trend is up, however I do not like how everyone I know is bullish and expects higher prices going into the end of the year. A healthy pullback or long term sideways movement would help work off the "uber-bulls" overly optimistic sentiment. Another sign is this: I went bullish in APRIL/MAY after being bearish the entire year. Most people during the Apr/May bottom said I was wrong and the market would soon head down again. WRONG!! Now those same people who were bearish during the bottom and this entire move up are now turning into bulls (not all, but enough). This market is a momentum train that is very dangerous to fight against, so going long is the only prudent method right now, still.

I still think we are near a short-term top and think the speculative nature of stocks with earnings reports widely spoken about helps reafirm my feelings. We will see soon if the market will continue to move higher-which it does when rates rise-or wants a pullback to work off some of this bullish sentiment. I mean look at the number of stocks making 52 week highs compared to last week. That is a negative divergence.

Good Luck!

New Swing Longs: JUPM PLAB LRCX SMA RIO EOC ORBK VSEA DTAS IMDC SMSC CPSI GTF ACAD

Swing Longs Outperforming Today: STJ NGPS VTAL FOXH DCEL IDIX EMKR ASTSF BMRN HHGP ASML ICON CKCM GMXR

Aloha

Hard To Stop Momentum

Market keeps chugging along. I still see signs that we are near a short-term top. No matter what, respect the individual chart patterns and have a good profit/cut loss plan.

Not much to add, except the night was full of earnings reports. We will see what tomorrow will bring. I have been expecting the rally that happened leading up to tonight. But now we wait to see how the market reacts tomorrow.

New Swing Longs: FILE CUTR LSS ANSI WITS ORA CTTY HHGP NSIT ASTSF

Swing Longs Outperforming Today: DESC GMXR LGBT BCON GIGM PETS ADCT OPMR APT BSMD CKCM AWA VTAL XWG

New Swing Shorts: QLTI CECO WB SXT ACMR

Lower New 52-Week Highs, Poor Breadth, and Earnings Season

Earnings are coming up so we will see how the market responds. For now with all the poor numbers coming out on the breadth and new highs side, my inclination is to expect the market to go down. However, many charts still look great and as you can see from prior post there were some nice ones today. I take it as a signal market needs to pullback here and consolidate for a move higher. If the charts do breakdown that assumption will be ripped to shreds.

Get ready for earnings. I wonder if it will bring some higher volatility to the markets?

Aloha

Market Commentary Will Be Later

New Swing Longs: FPU NWY WHR LH APT

New Swing Shorts: CDWC VRSN GDT HHS C EYET

Swing Longs Perfoming Well Today: IPII GERN BDCO DSTI ANGO CPTV CWTR CIB OIIM AWA EMKR IDIX LMS BSMD

Swing Shorts Perfoming Well Today: BAC DGII

VIX Hits A 10 Year Low

Where did all the volatility go? I wonder if the VIX can break 10? Who cares, at 50 or 10 it is all good. Longs will either rise fast with volatile movements or they will go smoothly up-steady and strong. 1999 was fun and the money was quick and very rewarding. But slow markets are much nicer, if you ask me. The relaxing pace makes it easy to hold onto winners longer than I did back in those days. No matter what, having a cut loss and a method of taking profits is more important than "picking" or "selecting" great stocks to purchase long or short. Bottom line: I like the VIX at 10.33. That doesnt mean I think it is going to stay there much longer though. :)

Friday was a dull day for the markets, as volume contracted across the board. I am getting about the same amount of longs as short candidates in my scans so I am wondering if we are going to take a rest here. I really think we need to because some short term damage has been done to stock charts and for the pattern to look correct again a basing period needs to happen. If it goes straight back up the charts will havve a historically good chance of reversing their immediate upthrust this late in the bull cycle. These moves are called V-bottom moves. Gary B. Smith of Realmoney.com describes them really well in his commentary. Biotech, Insurance, Semis, Medical-Dentist, Genetics, Retail-Consumer Elec, Telecom Wireless Equipment, and Internet Content are the sectors seeing recent inflows as a sector rotation is occuring from the Oils, Metals, and HMO/Hospitals.

New Longs: MIDD CVD PTA NEOL ALXN ANDS WYE AOC AGO

Longs Making Strong Moves Today: HLTH BMRN CSU

New Shorts: ARLP HOTT HITK DGII RMBS SCHL BEZ IHP

Shorts Making Strong Moves Today: EMAG

I can not stress how important it is to short at the right moment very close to a previous resistance level, imediate break of support, or a moving average. This market is not a bear market, it is still a bull, the best shorts come after the market starts a downtrend. I know that is hard to believe. BUT IT IS TRUE!

Aloha

Small Caps Weak, SP 500 4-Yr. Highs, Negative Breadth, And Too Many Bulls

The SP hit new highs for the year. Yeah! right? Sort-of. Small Caps sold off today on a pickup in volume-Its 3rd distribution day past two weeks-but Semis and Bios led. Was that great for the market? No. When Big Caps start outperforming the smaller leaders, the markets are usually trying to put in a top. If it is short term or long term top, I do not know. I have a feeling it is probably short, though. The SP 600 is up 15.3% since the rally started April/May so a rest and/or pullback is definitely warranted at this point in time.

The rotation into Big Caps is evident in my scans, as they are the best looking charts at the moment. Most of the Small Cap stocks showing up in my scans are extended or just too wild in price action to be considered longs. As that happens there are few new buys and it is a great place to take some more profits. Not only that, since the market is looking toppy, with the recent frothy action, I have sold ALL laggards. Better to be early and book a small loss than be sorry and not have a stake to trade later on. The small oil plays on the other hand as Jim Cramer says "cmmonnn baackk." I am not ready to take profits in these guys yet. You know the ABLE GEOI DSTI etc. I have taken some off the table past two weeks. But the majority of my position is still long and strong.

One final parting blow. The AAII survey has only 14% bears! Short term top anyone? BTW, everyone can go back to May 4 and see that was the day I got long this market. I am still a bull but I am starting to see more signs that a short top is coming into play. With all my talk of how I am bullish longer term, I am building quite a larger short position than I thought I would have by tomorrow morning.

Account looks like this at the moment: 40% long, 25% short, 35% cash. Last week: 80-100% long, 0-5% short, and 0-20% cash. I wonder if this is telling me something more than I think it is???? I mean, the more I think about it, 14% bears!!! Everyone must know about this rally now, it seams like.

New Swing Longs: CRED ELTK ONXS ONNN

New Swing Longs On A Pullback: CRM

Longs That Did Great Today: STEM SPNC

New Swing Shorts: NXTP NVDA SNDA MAR HNP EMAG PRX GDP

Reversal of the Week: CCC (only lost 8%, but look at the reversal today)
Aloha!

Boring Day, Inside Day, and Some Smallcap Weakness

Really a pretty boring day overall for the markets as volume rolled in lower across the board. This suggest it's consolidation time, per my comments yesterday, for the indexes. The smallcaps and midcaps were weaker but nothing to get freightened about. I sold down some longs that showed some great gains on some charts that look a little parabolic for the short term. Doesnt mean I sold them all but I did pair them down by my usual 1/4 sells. Besides that, not much else to talk about. Unless you want to talk about Bernie Ebbers and WCOM. For me I have heard enough on CNBC to last me a lifetime.

New Swing Longs: TOA DXYN OPMR(own since January, but was not writing blog then) AWA ESLR ASML NTRS ADCT AWRE

Swing Longs That Did Great Today: ENG KNDL ILMN OPMR DRRX WEL DESC CCC DCEL STEM VASC

New Swing Shorts: HMA UHS LGF CRAI WCN. The whole medical sector took a hit today. If there are low volume rallies and subsequent high volume breakdowns in these stocks they will make great shorts: LSCP HCA HITK CYH ABT SRZ. But if this happens dont overstay your welcome. These stocks have GREAT GREAT GREAT fundamentals so they will not fall 50%. If they do crack, 10% would be the most I would look for in these. Dont be greedy!

Mixed Trading On Mixed Volume

Nasdaq lead the way today with the SP following. Volume on the SP was higher than day before, switching roles with the Nasdaq in recent days. The Smallcap and Midcaps have hit new highs and continue to produce the best stocks out there in this rally.

The market took a little breather going into the close but did not sufer a lot of damage. Two stocks I was long showed some classic reversal signs; one starts with BO the other IP. And other stocks today had some short term parabolic moves so I had to take some money off the table today. These two scenarios along with the lack of quality breakout or high volume candidates helps me come to the conclusion a short term pullback is about to get started. I would always like to be wrong, when I see this happening. But at least I am ready, if it does.

New Swing Longs: NSS PPC TAYC MPWR MMSI ILMN SUG AVTR ACP

New Swing Longs If There Is A Pullback: CNVR IRIX

Longs That Looked Great Today: TALX ENG FSL CTRX ABP ENY BCON GEOI ABLE WEL DENN STEM RADS PRLS TGE BBSI

New Swing Shorts: WEN NCR SGR BNK AMWD

Aloha

Two and A Half Month Rally Continues

Volume increased on the Nasdaq and was mixed with the SP 500, 600, Russell, and the Dow. Market continues to act very healthy and there is still no reason to be bearish. But today was the second day I could not find more than 10 great charts for new longs. All of my good longs continue to act well but new longs the past two days, during this rally, have not been plentiful.

Read yesterday's market commentary for more depth on the above subject.

New Longs: IPII ELOS UNF ERS VAS MOT NSTK MIDD BBSI MBWM

New Long After Pullback: MCRL

Longs Still Looking Good: DSTI DCAI BOOM ANGO ENG JMDT HITK MSCC AMED RATE JMDT DCEL UPCS APCS CPTV GNSS RBAK PETS LMS MCF

New Shorts: CRYP WPTE PCLN

Aloha

9:42 HST---------Two more longs for swing trades: XWG WEL

Russell 2000, SP 600, SP 400 All-Time Highs

What a market!

The Russell, Midcap, Smallcap all made all-time highs and the Nasdaq on Friday gave a "Golden Cross" signal. What is a golden cross? It is when the 50 dma moves above the 200 dma on an increase in volume. That is as bullish a signal on an index as you can get, besides after a long downtrend being up 5% on a huge increase in volume (Oct. 2002).

Bottom line is this market is STILL STILL STILL very healthy. I have not fought the advance so why are you? All day Friday--besides some good traders I know--I heard how this is going to fail when the momentum to the upside stops. You know what kind of people say that? The people who were shorting the indexes off the London terrorism and the people who were not long enough going into this 1-2% rally in the indexes. To them I say your arguments are pure malarchy. Even my favorite commentator on Realmoney is currently bearish-James DePorre. Well, terrorism doesnt scare me anymore, as it is a fact of life till we can eradicate these murderers. Just like the bears dont scare me when I have a lot of bullish charts on my scan. I say bring on the bears, cause there is too many half-ass bulls out there. If we could convert more bulls to bears as this uptrend moves along, that would be great. If we dont, be ready to cut your losses.

The indexes all rallied from 1 to 2% (Russell2k up 1.98%) across the board, with some of the indexes breaking short-term resistance. Some other key technical signs I have noticed is that the SOX (Philly Semi Index) 5 week modified moving average has crossed the 200 week simple moving average (first time since crossing down in 2001). The last time the SOX did that was in 1998 and it led to huge winners in the semiconductor field. As I have tons of Semiconductor stocks with nice charts that have already offered me some nice gains, I feel history is what??? Repeating itself.

The caveat with all of this though is that it does seem to me there was not enough panic last week. I know the put/call got over 1.0 on Thursday morning, indicating short-term capitulation, but still there was not enough fear to wash out the weak hands in-my-opinion. But what do I tell people about opinions in the market? I tell them, who cares? The market sure as heck does not. Until the market sells off 2% with a big spike in volume, I will remain bullish.

Indexes:
Long term (Oct 2002): Uptrend
Intermediate term (Aug 2004): Uptrend
Sub-Intermediate term (Jan 2005): Down to Latteral
Short term (Past month): Uptrend (sp600, mid400, russell, nasdaq), Latteral (sp500, dow)

New Longs: ANGO PRWT FICC CEM NUS SYGR RADN

Longs Still Looking Good: ENG CHCI NGPS SCVL IBN ASR RTSX RATE JMDT LMS AIX GIGM PANL SIRI RBAK INTU

New Shorts: MHS

Aloha!

YOU GOTTA LOVE THIS MARKET

Resilient. This market took the terrorist attacks in London very poorly in premarket hours and as more info came in began to bottom; off to the races, we were, for the rest of the session.

Volume rose across the board and the tails in the Dow, SP 600, SP500 charts show how beautiful the reversals were. The Nasdaq was the super strong index today. Last night before I took my quick nap, NQs were down 41. Just awesome, the come back.

Market Indexes: Long term (Oct 2002) uptrend, Intermediate term (Aug 2004) uptrend, sub-intermediate term (January 2005) downtrend, and Short term (last month) latteral.

That is what is happening in the market, currently. Predicting the future is impossible, so I dont know what is going to happen next. But the market held up really well today in light of terrorist attacks and there are still good charts out there. Plus I went through my short scan and can not find any new shorts to add to the ones already put on. Still volume was much lighter than I expected, so there was not a real sense of fear in the air. Some negatives, some positives, some sideways action.

New Longs: CHCI GR ENY AEZ CCC MFLX INTU ININ

Longs Still Looking Good: ASEI COGT IBN ICON DCEL RBAK THQI ABP BSMD

New Shorts: Oddly none!

Aloha

Terrorism In London

Dont panic at open. Do not take new longs or shorts at open.

A Negative Reversal/ Divergences In Indexes

The nasdaq barely gave back 1/2 of its gains from yesterday, however, the Dow gave back all its gains and then some to break through support. Volume rose across the board, marking small distribution days. This marked the third distribution day for the Nasdaq in the past 4 weeks, and second for the SP 600 since June 7

It is normal in uptrending markets to see distribution days. It is what happens afterwards that is important. No matter what happens, have a game plan to cut losses and only buy the best stocks in strong sectors.

There was some crazy action today as the indexes made intraday lows, then intraday highs, and then reversing again to land near the lows. This action normally is a precursor to a move down, after an uptrend.

I sold down some longs today that showed big profits past couple of days and have been cutting some longs that reversed today. I was able to raise my cash level and am looking for some weakness in the very short term.

Earnings season is coming up and a lot of charts with those big uptrends might have already priced in good earnings. So if a company doesnt beat its numbers, I am sure it will get punished.

New Swing Longs: EPAY RBAK GERN EML

Stocks Looking Good Still: ENG ABP TRGL

New Swing Shorts: BC PDCO ZOLL ADEX HMC DLP IHP RI BWLD

Remember when shorting, to short as close to the moving averages or support levels as possible and never let a short go against you more than 5%. I set alerts on my IB platform to alert me to the best risk/reward level.

Aloha

SP Smallcap 600 New Yearly High

All indexes rose across the board, on an increase in volume. That is not saying too much, considering the holiday weekend. But across the board excellent action in the indexes, including a new yearly high for the SP Smallcaps. I wonder where the action has been?

I have been away from computer most of the day so have to keep it short. Bottom line, this market looks alright. Especially that SP Small Cap 600.

New Swing Longs: SPN ATMI MTCT HOS EEEE PRAI ECR LMNX SBTV NOVA RPI

New Swing Shorts: LXK NXTP CSGS(short at 17.50--too extended currently)

Aloha

Happy Fourth Of July

Today is a day for celebration!

Go hang out with family or friends!

New Swing Longs: EAC THE BTJ MCF CRED GIGM CNET

New Swing Shorts: APD

Aloha!