Indexes Finish At HOD; Broad Rally On Heavier Volume

Another Accumulation day for the indexes as the SP600 was up 1.8%, the Nasdaq was up 1.5%, and the SP500 was up .9%. Volume increased across the board but was not that much higher than yesterday. However, since volume was up it was an accumulation day. Another sign that there was decent accumulation today was the broad rally in all sectors which gave the market great internal breadth readings on the day and helped the indexes close at their HOD (highs of teh day) - All three indexes.

4 1/2 year high on the Nasdaq and ALL TIME highs on the Dow Transports are pretty amazing considering this economy is supposed to not be in good shape. Well, all time highs in another index along with the SP600 already making all time highs tells me that 10 quarters of 3% GDP growth is pretty good and the economy isnt as scary as the bears like to paint it. Silly bears, your opinions are worthless, unless the market is moving in the direction of your opinions. Since 2002, you have been wrong and at 4 1/2 year highs on the Nasdaq you are still wrong. Facts are for winners (fundamental and technical analysis), opinions are for fools (perma-bears that think Armaggadon is starting tomorrow).

Over three-quarters of my stocks were up on the day and almost half were up at least 1%. It doesnt get much better than this. What makes me more excited about days like this is the fact the indexes were only up .5 to 1.5%. If we would have been up more, I wonder what my account would have looked like. :)

More Commentary Before Opening Bell.

New Swing Longs: CWTR FFIV TFSM DCGN BFR NXG CDE AUY GRS BAM STEL PEIX MRB

Longs Outperforming Market: ESLR-69% NRPH-65% EMKR-60% SUPX-60% ACR-52% SRLS-45% SMTS-39% NUHC-31% OXPS-30% EAGL-30% LTON-28% LMIA-27% CPTS-27% MNG-26% ANST TRAD CMED CKCM NMR GOL NWRE RADN RTK RNOW FDRY SILCF GAIA UIC CVO BNT TEVA CIB MIDD FAST EDS PAYX CTHR SXC HOM KYPH ISIL NSC SRCL VAS ICTG KEX MNST FWLT SVA ANAD SBAC NOVL SSFT Q UBS ING

New Swing Shorts: NONE

Shorts Outperforming Market: NONE

A Day That Really Had No Meaning To It

Today was one of those days it is hard to comment on as there was not much action. The major market indexes basically did nothing today, basically closing unchanged. The good news is that after morning weakness the indexes closed strong. Despite the strong close though breadth was weak all day long and there were more new lows than new highs. That is not positive, no matter how anyone spins todays up close. To go with the bad breadth, the two leading sectors today was Oil and Gold. I am not sure what that means. It is either bullish or bearish. I don't know.

The Nasdaq has been having a hard time getting over that 2200 level that has been acting as resistance for the past 4 1/2 years. That heavy resistance might be the reason we cant get a lot going on the upside right here. Another reason could be that more people are bullish than I thought would be at this point. The way the media rants and raves about the economy ready to explode into a recession, I was stunned to see that for the second week in a row the amount of Newsletter Writers who were bullish increased again to 53%. I definitely would have thought it would fall this week, after all that I have heard on TV, despite what the market has done. 53% bullishness is not extreme but it is close to that 60% level that marks a contrarian bearish position. But these indicators are not the final say. The final say is the price and volume action of the indexes. Until they start breaking down on higher volume, the trend is up and bullish. Just like overbought markets can stay overbought, bullish newsletter writers can stay bullish for a long time before market turns down.

Until the market turns down, the short-term consolidation continues in this very strong, resiliant market. All trends are up in all time frames: short, sub-int, intermediate, and long-term.

New Swing Longs: FDRY SNPS SILCF DEZ(replacing the 1/2 of position already sold)

Swing Longs Outperforming Market: GMXR-89% RES-64% ESLR-64% NRPH-58% SRLS-44% AAPL-40% HITK-34% NUHC-29% UHAL-28% TESOF PTIX ASPM MNST CKFR MRGE MNG DEZ UIC

New Swing Shorts: SYMC BCSI

Shorts Outperforming Market: ARM

Stocks On Radar Screen: SIL YHOO FFIV VLCM CNTF DAKT

A Needed Pullback; Small Stocks Get Hit

The major stock indexes fell across the board today, with the SP500 down .4%, Nasdaq down .6%, and the SP600 down 1.1%. Volume came in higher on all indexes today, giving the indexes either their second or third distribution day since the start of the rally. The consolation prize to todays distribution days is the fact that the volume on the Nasdaq was below the 50 day volume average. However, the volume on NYSE was higher than its 50 day volume average but still below the volume it saw on the upside since the rally began. So there was some light to the day. Another positive is that all indexes still remain above their 50 day moving averages. So that level of support is still there to bounce off of.

This market needed a day to scare the bulls and embolden the bears to push the short side. That will create a healthy backdrop for further upside potential. So the down day was healthy overall and it was what I was asking for. The constant negative news helps keep a less than bullish bias out there so any drop should help the contrarian trader. Slow and steady in an uptrend is much better for long term gains than huge quick burst. Those burst usually end in a big pullback. It is the slow and steady that wins the long race.

I have to admit, though, the selling in some of my small cap stocks was stunning and my account got hit harder than what I thought it should have today. I am partial selling some of my longs with big gains and stocks that are not acting well tomorrow. However, I am not selling a lot, for most of the stocks still have very solid long-term chart patterns.

What happens now is what is important. There is always ocassional distribution days during markets in uptrend but further high volume selling would be problematic and cause a higher level of concern on my part. But if we bounce from here and base a bit I will sleep much easier knowing that the markets uptrend is safe. If we rollover, be ready. You never know what can happen. I really don't think we will, due to the constant negative headlines I see everyday. But I have been surprised by less.

New Swing Longs: TESOF

Longs Outperforming Market: SUPX-56% SRLS-38% PTIX ICTG EMKR MRGE NUHC

New Swing Shorts: WPS EDO ARM

Shorts Outperforming Market: NONE

Stocks On Radar Screen: PTC HRAY NVAX VISG SSTI ELOY PEIX

A Quiet, Listless Day With Little Meaning

The stock market did absolutely nothing today accept consolidate recent gains of the past four weeks. With no economic reports on hand today, that might have been a reason for the lackluster trade. Another reason could just be an extended Veterans Day vacation. Whatever the reason is, it is still nice to see the market pullback on quieter volume (NYSE volume was higher but mainly due to GP).

A nice pullback on low volume or some sideways action would be welcome right here to help set up a nice launching pad for a strong rally. A pullback would also help dampen the bullishness and increase the bearishness which would help support further price advances. The bears have been out heavy the past four weeks yet they have been unable to do anything of significance to the downside. In time they will give up and become bullish, but usually that happens later on in a rally. So until that happens there could be some great stock gains to be made out there.

Even though the market was quiet today it probably will not stay that way. This week is loaded with economic data that should light a fire under this market. With the current seasonality being favorable along with the amount of beautiful charts of stocks with great fundamentals, it appears we could have a nice year-end rally. But no matter what happens just make sure you stick to your buy and sell rules and IGNORE ALL OPINIONS OF CBS, ABC, NBC, PBS, CNN, etc. Those idiots who run those programs and produce those SCARY shows about the economy have never made a dime in the stock market and I gaurantee you they will NEVER make you a dime either. Ignore their negative biased news and concentrate on the facts -- charts, earnings, sales, return on equity, sponsorship, profit margin, etc. That is what makes you money; not the perma-bears calling for a collapse of US economy. How many years have they been on that? I have been trading since 1996 and I remember hearing about it then. Some things never change. THANK GOD.

New Swing Longs: BOT SVA PTIX

Longs Outperforming Market: NDAQ-251% BMD-220% BTUI-108% PETS-95% RTSX-88% SYNC-81% WIRE-61% SUPX-53% MESA-41% AAI-40% SRLS-33% CNET-28% OXPS-28% LMIA-27% EAGL-26% CTHR HOM ASEI CKCM TSCM RNOW CPTS ELOS WBSN DJO LIFE CKFR MNST CMED VAS RSTI CIB ISIL RADN TEVA LCAV BCO ABAX BWNG BVF SWIR OUTL NUHC BNT

New Swing Shorts: NONE

Shorts Outperforming Market: NONE

Stocks On Radar Screen: GROW ONCY AVII TIII MED STEL

For A Slow Day, There Were A Lot Of Stocks Showing Great Gains

More Commentary Later:

When you are positioned correctly, days like today kind of sneak up on you. Friday was one of my better days of performance in the markets where almost half of my holding were up 1% or higher.

This market is way overbought and a lot of bears have turned into bulls so I am feeling a bit cautious about a lot of further upside in the short term. However, with how strong the overall big picture of the market is I believe we may get overbought and stay overbought. Also a lot, but not excesive, bullishness isnt necessarily a bad thing. Much of the 2003 rally came with bulls over 50%. It is when they get to 60% it is sketchy. Even then in strong bull markets it dont matter. It happened in 1995 and 2003 and both years saw the Nasdaq make 40%+ gains. Both were long term bull markets that had very little pullback in them. How is that possible you ask? It is because of the fact that these surveys that grab opinions of writers and investors and not the actual data of their trading. They may say they are bullish. But are they invested? And if they are invested are they 100% or 20% invested? That is why in run-away bull markets you can get 60% bullishness among newsletter writers yet have the market rally huge. It is because they are bullish and still have not fully invested themselves. You never know why they did this. Maybe they didnt "believe" in the market, maybe it was "too expensive," or maybe they have certain rules they have to follow. Whatever the reason it doesnt matter, if the markets are ON FIRE. The markets will leave a trail of dust in the paths of the slow-to-act traders.

New Swing Longs: CKCM WBSN KYPH ICTG ING

Longs Outperforming Market: VRTX-97% RTSX-86% BBSI-71% AOB-68% LCC-62% NRPH-58% WIRE-55% SUPX-51% MESA-39% TRAD-30% NWRE-30% HITK-30% CRDN-27% CNVR-26% LMIA HOM VIGN TOMO ERS CPTS MORN MNST NMR CMED BNT LCAV CPSI SCUR EAGL ARS SAY GOL CKFR CIB NNDS TEVA LIFE MIDD DJO SWIR VGZ TNOX BVF WEBM ASPM RSTI NUHC

New Swing Shorts: NONE

Shorts Outperforming Market: NONE

Small Cap Stocks On Radar Screen: TIII AKN CSU

It Is Hard To Stop Momentum On The Upside

Markets can travel further and faster than you think. Go back and look at every bull phase of the market past 20 years. You will see during every bull market there were few pullbacks. Momentum once it gets started to the upside is hard to stop. Overbought markets can remain overbought for a long time. So all you perma-bears out there should wake up to reality and realize you are dealing with one of those kind of markets right now. Until this market rolls over you are playing with fire if you are shorting stocks. Remember, three out of four stocks follow the general trend of the market. That trend is long and strong.

If you hate GWB, fine. If you dont like the deficit, fine. I dont either. If you dont like the war, fine. But who cares what we think. The only thing that matters is the facts and as you will see below the facts speak for themselves. This is a great market for longs. Period. There is a lot of money being made on the long side right now. Now is definitely not the time to be bearish.

If anyone is wondering why I am addressing this subject it is because I monitor a lot of chat rooms and I am shocked by the traders who have been trading for 15+ years that still can not read the market and can not seperate their emotions from their trading. After 10 years it still feels like I am in the very first stock market chat room I ever entered. Some thing never change. Thank God!

New Swing Longs: ADP SRCL RSTI ASPM DJO ERS TOMO EMT MEL UIC

Longs Outperforming Market: DESC-184% LCC-60% ACR-48% MESA-37% AAI-35% MIDD-28% OXPS-27% LTON-26% EAGL-25% TRAD CMED LMIA MRGE MNST CRDN FAST LOGI STJ PAYX BNT MDCC SIGI SAY ISIL KEYS HSP CPTS NFLX WEBM Q ABAX GAIA PEGA NUHC

The Stock Market Produces More Big Winners In Individual Stocks

The major indexes continued their march up after going lower yesterday. More sideways action would be great right here to get the bears growling again and help lesson the bullishness of the bulls. But upside action is welcome too as that shows that stocks are very strong. And that can only help your help your bottom line. Breadth was good today and volume was mixed so it was one of those days you can't get too much of a read into. Except to say, that for a market that is supposed to get weak it sure can't mount much of a move to the downside. Maybe that will happen later but for now the trend is your friend. And when your friend the uptrend is around you definitely can make more money with it than you can with your other friend the downtrend. Both are your friends but one is WAY MORE rewarding. What's the most a stock can go down? What's the most a stock can go up?

New Swing Longs: CMED ASEI CTHR LCAV CPTS SMSI WEBM ASML LMIA PEGA KEYS

Longs Outperforming Market: NDAQ-241% BMD-219% DESC-171% VRTX-92% RATE-84% RBAK-72% ASGN-65% AOB-63% SYNC-62% CCI-59% LCC-52% SUPX-48% ACR-46% TFR-28% FAST-25% KG MRGE OXPS VTIV RADN BNT FWLT IIJI ARDI LRCX ABAX SMTX CIB SBAC MCX

New Swing Shorts: NONE

Shorts Outperforming Market: NONE

Small Stocks On Radar Screen: TRT ICTG

Markets Take A Rest On Lower Volume

The major market indexes finished down today with volume lower across the board, except on the SP600 where volume did increase but it was not by much. Breadth was negative all day with few groups ending the day up.

The pullback in the indexes was needed today as the markets were getting a bit overbought. A pullback, after this good run, is needed to help create bases in strong leading stocks so that when they breakout they will have a stronger base to launch out of. This pullback also keeps people from getting too bullish too fast and helps bring the bears out of the "I told you we were go lower" camp. With that kind of backdrop it will make it easier to climb that proverbial "wall of worry."

So it was a boring slow day that didn't have much excitement about it besides TOL. The big news was TOL and its earnings guidance and miss. To that news I say: DUH! Every stock in the Homebuilders group started breaking down in July/August on heavy volume. Besides that, Ken Heebner the fund manager for CGM Focus Fund-One of the best funds past 1,5,10 yrs-sold all of his Homebuilder stocks earlier in the year. Why is that a big deal? Because he was buying them in August of 2000 and held them the entire way up. He invest in only the best of the best. He is the best and by looking at the stocks he holds you will see why he is. If you would have invested $10K in CGM Focus five years ago it would now be worth $35K+. What stocks is Ken Heebner buying now? Go check it out for yourself.

New Swing Longs: SMTX SBAC ABAX COHU DDD

Longs Outperforming Market: NDAQ-236% DESC-162% WIRE-63% CCI-55% SUPX-45% LCC-43% ACR-41% NWD ARS VTIV SCUR MDCC RVSN MORN LDSH ARDI ACTG OPTC MECA TFR

New Swing Shorts: NONE

Shorts Outperforming Market: NONE

Small Stocks On Radar Screen: ICTG EPAX AABC NTII

Indexes Up For Fourth Day In A Row

The markets finished higher on mixed trade today, with great breadth. Momentum continues to favor the bulls as once momentum starts it is hard to stop. And bullish markets once they become overbought can remain overbought. I bring this statement up because there is a lot of chat room and message board participants calling for a near term top. Uh, maybe, but I recommend those that have www.realmoney.com to read Guy Lerner's article about markets getting overbought and staying overbought. Like in 2003. Does anyone remember that year? Or is our insatiable ADD too severe to remember something that just happened two years ago? Oh yeah. It is.

There are a TON of great looking charts and longs that are acting well. Until that pattern changes I remain long in a Bull Market.

I left out a few sectors yesterday on the leadership board. Here they are:

MEDICAL-PRODUCTS
TELECOM-FIBER OPTICS
COMPUTER SOFTWARE-MEDICAL

Those combined with the sectors in my previous post show you where the REAL leadership is.

New Swing Longs: SCUR NWD TSCM KOPN MECA BWNG LIFE ACTG

Longs Outperforming Market: BOOM-282% NDAQ-229% BMD-202% DESC-140% RTSX-75% MFLX-63% ASGN-57% AOB-53% WIRE-51% SYNC-51% THOR-48% ACR-40% HITK-38% HOM CPSI ITRI BNT ALO CRED EAGL ELOS PAY MDCC FAST NMR VAS CAMP WSTC TAYC CTLM BCO IIJI TQNT ARXX ABMC FIX GAIA

New Swing Shorts: QSFT COG CMCO

Shorts Outperforming Market: ECA

Market Closes The Week The Way It Began: Strong

A lot of sectors have been taking new leadership roles the past three months. So since some of you stock traders have been saying that this rally isnt going to hold. I would like to ask why are all these sectors making big moves the past three months?:

BANKS-FOREIGN
FINANCE-INVEST BROKERAGE
INSURANCE-PROP/CAS
TRANSPORTATION-SERVICES
COMPUTER-MANUFACTURER
INTERNET-CONTENT
TRANSPORTATION-TRUCK
FINANCIAL SERVICES-MISC
ELECTRONIC-PARTS DISTRIBUTOR
COMPUTER SOFTWARE-DESKTOP
COMPUTER SOFTWARE-SECURITY
INTERNET-SOFTWARE
COMPUTER-NETWORK
MEDICAL-BIOMED/BIOTECH
MEDICAL-SYSTEM EQUIP

Do you see that list. Those sectors aren't Gold, Oil, Metals, and Food. It is real leadership in sectors with real long term growth. The fundamentals on some of the companies in these groups are out of this world (ie...GOOG). So until we rollover and make new lows this market looks as strong as a BULL with big giant bloody horns due to the death of the BEARS.

No matter how terrible you think the deficit is, the market currently doesn't care and only cares about what is really important. GDP growth and corporate earnings. And both are rocking! Until that changes all trends are up.


New Swing Longs: OPTC VAS RL ITRI ELOS ARXX ALKS SHPGY PMACA

Longs Outperforming Market: BMD-183% RBAK-80% ESLR-58% LLC-40% AOB-37% GES-34% CRED-30% RADN PETS CAMP CLDN TRAD MRGE MDCC RVSN BBBB BVF CNXT NMR Q ABMC SYNT

New Swing Shorts:

Shorts Outperforming Market: NONE

Small Stocks On Radar Screen: ICTG EMBX ESP

Markets Continue To Move Higher

I took more profits today than new positions. Taking some profits on the way up, after stocks have made 50%+ moves is just a wise thing to do, in strong markets like this. There are plenty of new stocks out there that are ready to replace the PRLS, ASF, BMD, and NDAQs.

New Swing Longs: SXC MORN ICON JDSU TNOX GAIA TW

Longs Outperforming Market: BMD-158% BTUI-89% RTSX-68% ASGN-53% SUPX-41% MESA-35% ACR-35% CVO-35% AAPL-34% GES-29% NWRE-26% TRAD NUHC PETS LOGI FCN FAST PNRA CKFR MRGE CPSI CAMP EDS MU TEVA IIJI IED EAGL BKHM REGN ICGE ISIL BVF RTK LRCX AXE JCDA SYNT ABMC

New Swing Shorts: NONE

Shorts Outperforming Market: NONE

Markets Stage A Big Rally On Very Heavy Volume. Most Markets Close Near Their HOD's.

The SP600 was up 2.1%, Nasdaq 1.4%, and the SP500 up 1% for the day. Volume came in much higher than the day before and well above all the indexes 50 day volume average. The markets rallied with great breadth also, with the NYSE having a positive ratio of 3 to 1 and the Nasdaq with positive ratio of 5 to 2. The above indexes have also now all crossed their 50 day moving averages to the upside. Reversing a trend of the previous two months when the indexes would fail at that key line. Also the downtrend line on the Nasdaq chart connecting the tops of the past 3 months has been broken to the upside. Overall a very BUSY and bullish day.

I would prefer to see some nice consolidation right now before further upside. That would help set up some properly formed and pretty bases that would help power a stocks launch. But a coninued move up would be wonderful too as there are plenty of current longs that are breaking out or about ready to again.

Days like today can make a traders year. My year was made today! This is the reason you buy great stocks breaking out of great bases in strong sectors no matter how bearish the crowd is.

Another thing about GDP. GDP has been growing at over 3% for the past 10 quarters in a row. That is extremely strong considering how we just went through a recession. Dont foget, right after the tax cuts in 2003, GDP was 8% higher than the year before. That along with 10 quarters of 3% higher growth is very bullish for the economy and I am not sure why people stress the deficit over the GDP growth. The deficit is very important and we need to get spending under control cause it is out of control. But the current GDP growth we are seeing along with the great earnings show that this economy is strong. How the media likes to scare people out of buying stocks. Even I hate the current spending by the administration but that has nothing to do RIGHT NOW in the stock market. The GDP is way more important.

Silly bears, bearishness is for GWB haters. If you bears could stop hating the President for a little while and instead focus on the facts of the stock market-Tech, Financial Firms, Insurance, and Biotech/Medical stocks leading-you might have been long for the advance also. When these sectors show leadership at the same time that can make for a very powerful rally. I am not sure why or how you could be bearish, after today, if you were bearish still the past week. Remember I was a bear when we were going down but now we are going up. So why fight the trend? Especially when you have all these stocks breaking out and making good moves.

Bottom line: I have never met a "rich" bear.

New Swing Longs: AMED NNDS MOT PNRA HXM CNXT BCO KFRC IDCC Q MPS DB MU BNT TGS LQU ABMC

Longs Outperforming Market(stocks with % show the price performance since initial entry): NDAQ-247% BOOM-245% PRLS-226% ASF-172% BTUI-86% VRTX-80% BBSI-58% ESLR-36% AAPL-36% MESA-34% ACR-33% LLC-31% OXPS-28% FCN SMTS MDCC GOL WOOF SUPX STJ KG CNQR ADSK SIGI CPSI BBBB NWRE OXM FAST HITK MRGE MNST KEX WSTC CTXS RLI TRAD IINT RBAK IVIL LRCX IT PGR RVSN SYNT

New Swing Shorts: NONE

Shorts Outperforming Market: NONE

Indexes Consolidate Recent Gains

A minor pullback across the board today on good volume, for the indexes. The amount of charts that came up in the scan indicate to me that the high volume was buying power hidden underneath a heavy market because of DELL being down 8%. So this is no distribution day. Another positive, along with the charts (facts not opinions) is the amount of bears still saying this rally is marked up. We will see in time but for now we are going higher and I see plenty of good charts in Biotech, Tech, and Insurance. Those have some stocks with some HOT HOT HOT growth. So I am not sure why the bears are so negative right now but we will see if their prophecies come true. You know what would be the best? If the market goes sideways right here for a while before going up again. That will ensure the bears will overextend themselves and help launch a powerful rally. But just as cool would be to rollover. Unfortunately, the bears are so negative that it makes me sick. So I hope that doesnt happen. Either way, lets play.

With earnings starting to rap-up and all the bears in the chat rooms and message boards it feels like we might have crashed the past week. Instead we are up from then and still above the October lows. Until those lows are broken it is foolish to be bearish when there are so many good charts showing up.

A history lesson: During seven straight hikes by the Fed from 1994 - 1995, while people were very bearish, the SP 500 looked ahead and rallied 54% from Dec 1994 - May 1996. The Nasdaq rallied 61%. It didn't pay for those bears then and when this raps up it probably wont pay for the bears also.

However, we could rollover and all of this is wrong. Hah! LOL! Then it is time to short.

You have to be ready for anything.

New Swing Longs: GOL BAP MNST LOGI RTLX MDCC CPSI ZUMZ RVSN HSKA RTK UBS NMR

Longs Outperforming Market: ASF-160% PRLS-223% NDAQ-203% BRLC-78% ASGN-45% PETS CNVR OXPS EDS CKFR PAYX ESLR BKHM SHOO GES LWSN

New Swing Shorts: RTI

Shorts Outperforming Market: PRAA

Markets Follow Through On Higher Volume; Too Many Bears Out There

I listened to people all day deny what was happening today, as the market rallied. That is exactly what you want to see at the start of a rally. While this rally may not be perfect, it is a rally none the less.

There are lots of charts to scan tonight that have very nice price patterns. This is a good thing to also see at the start of a rally.

I will try to post more later but I doubt it. Tonight is Halloween and if you have never been to Maui you will not understand why I will not be around tonight. Halloween in Lahaina is the "Mardi Gras of the Pacific." Tons of people walk Front Street for six hours showing off their costumes while partying their behinds off. It is an experience.

So maybe I will be back to give more in depth commentary later. But the odds maker in me prices that at about a 18% chance of happening.

New Swing Longs: CIB MRGE EDS CTLM EAGL SHOO BKHM

Longs Outpeforming Market: ASF-145% BTUI-77% BRLC-68% THOR-46% MESA-32% SRLS-31% AAI-28% HITK-26% NWRE PAY CAMP ANST RAIL SAY TWGP RLI SIGI AAPL ABAX EFII

New Swing Shorts: NONE

Shorts Outperforming Market: NONE

Markets Snap Back; Nasdaq Rallies On Heavier Volume Than Day Before

Not a whole lot to add here this weekend. The markets were wild the past week, yet closed up. Why did I say yet? Did you hear all the negative and ugly talk about the stock market this past week. Sheesh. You could have sworn we crashed last week, YET here we are finishing the week up not down. Forget emotions when it comes to trading. You dont make money with your opinions. You make money with the price bars (or candlestick bars).

The one thing I keep learning every earnings season is the fact I HATE REGULATION FD. This thing is a joke. News being leaked out to favored analyst used to help good traders spot institutional buying and selling before earnings. Now there are blowups and gapups. It is a silly rule that really does nothing but hurt traders who trade for a living. Now if you want my opinion on Sarbanes Oxley, I point you in the direction of the pink sheets. There on the pink sheets you can find this stock called Refco. Good thing Sarbanes Oxley was there to protect investors. PFFFFTTT. Once again, a joke. Crooks are crooks no matter what. No stupid law will stop a crook from being a crook. Instead all the great companies have to spend a ton of money to protect the investor from the Enrons. This stupid law is set up to protect investors? How? Why is an investor investing in a company like Enron anyway. If it looks to good to be true and you cant figure out how they are doing this you dont invest in it. There should be a Sarbanes Oxley law for people who invest money in scam companies trying to get rich. If you are greedy, you get what you deserve. There is a fine line between Capitalism and greed. Greed is the reason so many Anti-American people bash capitalism. Greed is also the reason new traders that get into this game "to get rich" will be gone in three months to one year.

This is a game that works only for the people that love the game. AND I LOVE THIS GAME.


New Swing Longs: AXE WSTC ADP RAIL GMCR

Longs Outperforming Market: KEX SIGI LCC REGN ASF(139%) WES SYNT

New Swing Shorts: XNPT UTHR MOH TU EMAG

Shorts Outperforming Market: NONE

Small Stocks On Radar: ICTG IFO SNTO RLH

Heavy Selling Hits Market But Only One Index Suffers A Distribution Day

Today was ugly, without a doubt. Great heads-up by a couple of readers of this blog. You guys were on it, I was off. I still don't think there is too much downside left with how negative everyone is but I guess we will find out.

Anyways, as for the markets, the techs and small caps got whacked. The SP 600 was down 2.3%, the Sox down 2.7%, and the Nasdaq was down 1.7%. It doesn't get much uglier than that but there was one odd divergence. Volume. Volume was lower across the board, besides the SP 600 which suffered a distribution day. So far price is still rising on higher volume and falling on lower volume. Lower volume doesn't dismiss how ugly today was but it showed that institutions weren't stepping over each other in huge block trades trying to dump their shares. Besides that we still haven't failed the lows of the recent rally so the rally is still technically not dead. Though there is a lot more charts that don't look good at all, so that could change with further selling.

Still the market looks a lot weaker than it did after the close on Monday. The SP 500, 600, and Nasdaq are all trading below their 50 and 200 day moving averages. Also all have recently cracked key support levels at the 200 day moving average. All of those facts show that the market indeed is weak.

What is funny, however, is how much negativity there is out in stock land. Chat room bears are getting more aggresive with their talk and the markets are getting quite oversold again. I have already mentioned the Put/Call, Newsletters, and VIX contrarian readings so I won't go over them again.

I took a small hit today, but oddly most of my swing longs still look pretty good. Looks like October will be a "red" month for me, after all.

New Swing Longs: KEX CKFR RDTA SYNT

Longs Outperforming Market: REGN PRLS(205%) RNWK SWIR

New Swing Shorts: SRDX ERES CNX TRID ROP

Shorts Outperforming Market: PRAA ECA

Small Stocks On Radar Screen: VNX FUR ICTG CWBS RLH

Disaster Long: PPDI (-10% gap down) It happens, in choppy markets

Markets Suffer A Small Distribution Day

Markets finished down on higher volume, though the indexes were only down between .3 to .8%. Higher volume, on a down day, is not something you like to see at the start of a rally but a day here or there with mild declines is normal in most rallies. If the Nasdaq was down 2% today, I would have been worried. But the mild decline looks very normal and nothing to panic over yet.

To give an example of a distribution day popping up after the start of a rally, we can go back to the March 2003 rally. After the 5.9% gain on the Nasdaq giving a follow through day in mid March, the index was hit with a 2.1% drop on higher volume soon afterwards (check your charts). The stock market soon reversed and went on to new highs.

Another thing I want to comment on is the bearishness among traders. Pessimism is getting very thick and redundant in the chat rooms I monitor. Everyone is calling for an outright collapse. My years in the market tells me these guys are ALWAYS wrong. They may be right 6 months from now, but for the meantime the markets are rallying and longs have been very profitable the past week. Another positive development is the Investor Intelligence Survery of Newsletter Writers. The amount of bullish newsletter writers fell for the 5th straight week. This is one of the better contrarian indexes out there and I find it usefull to gauge bottoms when the bulls/bears line gets close to crossing or actually crosses.

I want everyone to understand I am not a raging bull, in this current market. I simply play whatever side the market is favoring. And right now it is the bearish side. Remember, not too long ago I was loaded to the gills on shorts. I favor no side and always find it funny how people can fall in love with the bull or bear side. Both sides are cool with me. But the bears are the most pessimist and angry group of people I have every met in my life. THAT IS THE TRUTH, no matter what anyone thinks. The bears will be bears, I have a feeling for at least another 3 yrs.

New Swing Longs: WOOF SWIR SIGI DIET

Longs Outperforming Market: CRDN RCCC SYNC WIRE PAYX

New Swing Shorts: PRAA ECA

Shorts Outperforming Market: NONE

Small Stocks On Radar Screen: BWCF FLT ACEC JCDA TELN

Markets Consolidate

The markets started the day alright then started to drift down the whole day, until the last hour of the day. The last hour provided a nice rally that left the bears who were calling for DOW -200 quiet and sad. The close in the upper half of the daily range gave the day's action a bullish feel to it. However further weakness would be welcome to get those extra negative bears pumping their shorts harder. That would guarantee a nice rally.

Earnings are good and most companies are having no problem beating expectations. This continues to prove that the economy is still strong and not as weak as the ridiculous bears think. The market could fail to reach new highs and rollover and make new lows, but until that happens why root for it? It doesn't make sense. The big money is made on the long side and their is plenty of money to be made in tech and insurance stocks right now.

So, once again, it is silly and plain stupid to be bearish when the trends are up. Until the trends turn down and these nice charts in tech start failing, I refuse to be "brainwashed" like so many traders I listen to in chat rooms. No wonder this job is easier to those that can take emotions out of the market. Every day I trade I realize why the good traders are good traders. They are able to keep their emotions under control and play the trend no matter what direction it is in at all times.

Great luck and remember: YOUR OPINIONS AND MY OPINIONS ARE WORTH NOTHING TO THE STOCK MARKET. NO ONE CARES AND THE MARKET ESPECIALLY DOESNT CARE. That is the cold hard truth. Our opinions are useless and always will be to the market. What matters is facts and below are the facts.

New Swing Longs: RNOW JDAS

Longs Outperforming Market: ABAX WIRE BTUI PRLS PETS AOB SRLS CAMP ANST HOKU

New Swing Shorts:

Shorts Outperforming Market: DGX

Technology Stocks Are On Fire; Markets Close Higher Though Volume Was Lower

Stock market indexes climbed throughout the session today with the SP600 up 2.2% to the Nasdaq's 1.6% gain. Volume was lower, however, across the board. I would have liked to see volume pick up, but with all the individual stocks moving it appeared institutions did go to work today.

There is a lot of uber-bears out there in the chat rooms I monitor. And they all have great points. From the yield curve about to invert, to inflation, to the new Fed chief, hurricanes, and whatever. But no matter what the worries are out there, which are all excellent valid points, until it actually shows up in the charts it is useless information.

Trust me, I am worried about too many rate hikes but the charts tell me for NOW I should not worry. Who knows maybe the Fed is done. We don't know and it doesn't matter what happens in the future. What matters is what is happening now. Right now, tech stocks and some other sectors stocks are going up A LOT and have very nice charts. These are not ugly breakouts, people.

When the market rolls over I will turn bearish again but for now any bearish argument is pointless and useless if you want to make money. I dont care how much I think the market is going to fall. If the market is going up, I am wrong. Bottom line. And that is the only line that matters if you are a professional stock investor.

With all this bearishness, maybe the market will climb the wall-of-worry to new highs. I would love to see the perma bears squirm some more. I love the short side as much as the next guy but shorts can only fall 99%. Longs, on the other hand, have an unlimited amount they can move on the upside. You can not get a 1,000% on a short, in a bullish market. Much less any market. LOL. Also history shows the market goes UP over time. Not down. Why fight the trend?

Just some thoughts to think about before the bell on Tuesday. Whatever happens, enjoy.


New Swing Longs: TWGP PETS ANST OUTL VIGN FWLT REGN TQNT ARDI TMNG RADN

Longs Outperforming Market: HOM AOB CRDN PMU REDF PRLS SRLS IRIS WIRE SMSC CAMP BTUI SGR CAMD JCOM FLSH PAY NDAQ SUPX NWRE RLI KNOT CTXS VIVO TEVA SAY AH GES OXM MESA MACR NOVL MTN BBSI

New Swing Shorts: DGX

Shorts Outperforming Market: NONE

Small Caps On Radar Screen: CMRO

Sidenote: Amazing day! If you read my previous post you will see I mentioned ending October in the red. Well, if I have one more day like today that will not happen. Amazing what one day can do to your portfolio when you are positioned correctly.

An End To A Very Volatile Week

The stock market indexes basically were unchanged up .8% to down .6%. The mixed day showed the changing of leadership that we are currently going through.

The old leaders-Homebuilders, Oil, REIT, and Metals-mainly reside in the NYSE and are your old Dow type stocks. The up and coming leaders hail from the Internet, Software, Commercial Services, and HMO sector, with most of these stocks trading on the Nasdaq (not all of course, but most). This sector rotation is obvious when we look at the index of the DOW and NYSE which have both failed the follow-through day from Wednesday. They still have not undercut the lows of the short-term rally but failing the follow-through day is very negative for these indexes which house the old leaders.

The good news is the Nasdaq and SP 600 are still holding up from their Wednesday follow-through. And these indexes are offering up the fresh breakouts in the above mentioned new industry leaders. This to me is very positive for a Jim Cramer tech rally into next year. If it happens great, if it does not happen just make sure you have a disciplined cut loss strategy. That way you can live to fight another day if this rally doesnt work out. But not being positioned in the leaders as they breakout because you don't "trust" this market is the silly rationalization that cause many investors to underperform in their portfolio.

I will take my long signals and run with them until they dont work. If this rally fails I will be happy, if it succeeds I will be happy. Why? If prices go lower that will clear out more of the "weak traders" and help create a stronger bottom to help launch the BIG winners. If we go higher now I make money NOW. I can't be bearish on any market that moves up no matter how "smart" I think I am.

Which brings me to my last point. No matter how YOU think the economy is doing, it doesn't matter at all. What you or I think is meaningless and will NOT help you make money. Only reality can make you money. And reality lies in the charts and fundamentals. If both are great and you think the market should crash. Well guess what I will enjoy making money while you cry about how the stock should not be moving higher.

After being a lurker in chat rooms for over ten years I can tell you one thing: There is never a loss for "know-it-alls" that never ever make money but offer opinions all the time. Don't these people have anything better to do? I guess not. Maybe they are just like me and addicted to one of the greatest professions on Earth. Or maybe they made their millions and now would like me to have it. Either way, bring them on more and more. The more that play the higher my pay.

Have a great weekend and I wish you great luck and continued success in the upcoming weeks.


New Swing Longs: RHI SAY CAMD SGR LEXR IINT RNWK CTXS GORX

Swing Longs Outperforming Market: SUPX MESA SMSC TEVA BTUI BRLC FLO WIRE MACR MTN

Small Stocks On Radar: PV BRN TRT KNAP MFW

New Swing Shorts: None. I am sick of destroying my returns trying to play this side. I don't know how well people can possibly be doing in this market on the short side, unless you are in oil stocks. All my gains in all my shorts the past two months have been given back in a matter of ONE WEEK! That is trading my friends. All those homebuilder and REIT short gains I made have been given back thanks to overtrading the past week on the short side. Ten years later, here I am making the same mistakes I made when I started. Funny thing is 50 yrs from now, if I am still alive, I will make these same mistakes. Why?? Because we are working with REAL MONEY. By default that will cause you to make completely ignorant decisions even when you know you should not.

Shorts Outperforming Market: None. I give up on this side, for now. I will wait for a full blown "obvious" recession to hit us before I visit this side again. OK. So I probably will not wait that long. But from now on the whole sector needs to be breaking before I dabble as "hard" as I did with these terrible short trades the past week.

I thought I would never say this, but if it wasnt for my ability to make consistent money playing poker I dont think I would have a pay check to show for the whole month. One thing is for certain: I will be ending the month of October with a loss from over trading. Hey that is my style. Every once in a while you go through this. It happened last year for a couple of months and October is no different to me this year.

Thank God for Poker! ! ! !

Market Reverses But Holds Above Yesterday's Low

The market definitely did not act the way I figured it would after yesterdays reversal. This is either a great way to wash out bears and bulls, or the market is one confused son-0f-a-gun. However we are still holding on above the lows of yesterday. So we have not killed this rally attempt yet.

The two failed bounces at support has held up and that is what is needed to create a decent bottom, if we are in fact building one. The one thing, for sure, is that this creates a higher level of bearishness with the wild volatility. This allows the weak holders to sell into the smart money hands and sets a stage for a possible rally.

But with all this possible bottom talk, we have to remember, that the averages are still trading below their key 50 and 200 day moving averages. Along with that, the trend of the 50 dma is down. This adds more pressure to the resistance, as time goes by and price declines. I can not believe I did not mention yesterday that the markets may not rally because of the fact the 50 dma is trending down and the indexes are all trading below this key average.

So it is up in the air. Up or down. I dont know but up is my guess with the reversal we had yesterday. I am not finding a lot of new longs but I think this is because their is an obvious sector rotation happening out there. The top 40 industries in IBD Industry Groups that have moved up the most the past 3 months is a great place to look for the next leading industry.

I left a ton of money on the table today, by covering my shorts in the morning. I could kill myself because as you saw today oil stocks fell quite nicely. I had enough oil shorts along with other shorts that fell over 5% today to make the month quite a nice month. Instead I might end the month with a loss.

Oh well that is trading. I have to keep to my style, because you never know when the market will take off. If I take the week off, I might miss on the "great longs" that come up on my scans. I might miss the next TASR(2003) or LMLP(1999) on the long side. Or miss the next ENGA (2000) or any Airlines (2002) on the short side. That is the kind of money that can make being a trader very rewarding.

Good luck out there!!! We need all the luck we can get.

New Swing Longs: PAYX VDSI ISIL HAR UB

Longs Outperforming Market: NUHC LDSH KNOT BRLC AAPL SUPX THRX

New Swing Shorts: PLCM TLM ECA EPEX BGG PVX BAK USTR RESP SID KCS BTU STLD XRX UTEK NUE CAL

Shorts Outperforming Market: Sadly - None. I covered my new shorts too early and missed out on a LOT of gains. Did you see oil stocks today??

Stock Indexes Give A Follow-Through Day On Huge Volume; Cover ALL Shorts

The very emotional and weak open with at one point 3 to 1 negative breadth gradually improved to give us a very volatile day that ended up being a "key reversal" day. The markets ended up 1.3% to 2% today on volume that was 25% higher than the day before. Adding to that, all indexes closed at their HOD (high of day). This follow-through comes on the 5th day of the most recent rally attempt started Oct. 13th. Also, remember, the count of distribution days have been reset with this follow-through. So all those distribution days the past two months are now erased and we are back to zero distribution days.

The talk of the dead-cat bounce being dead after yesterday's distribution day and the new lows in the morning opened up the flood doors of crash callers and blatent panic selling by bulls that thought the "bounce" was officially killed. This in turn caught the short sellers extending themselves too far and caught bulls selling their stock they just bought two days ago. By cleaning out the weak bulls and creating too much confidence in the bears this morning we were able to put in a bottom.

After the small yet none-the-less distribution day of yesterday it appeared the market was going to rollover and make new lows. But just like during the April/May bottom, a minor distribution day was needed to bring out excess pessimism that led to a nice rally. I am not sure how much rally we are going to have but the tepid selling of yesterday being met with the huge rush of big buyers today leads me to believe that we should be able to get some good gains from this.

This follow-through does not guarantee that more gains are for sure to come but no rally has ever started without one. This lifelong poker player will take those "bull" odds anyday of the week.

I covered every single one of my shorts today, taking losses on the most recent small buys and taking long-term gains in all homebuilders and any other stock showing long-term gains.

New Swing Longs: JCOM RLI FCN IMN WES BRLI EFII NUHC

Longs Outperforming Market: BRLC SMTS PPDI ADST LWSN TEVA PRLS OXGN CAMP FLO TAYC FAST PBCT

New Swing Shorts: NONE

Shorts Outperforming Market: There was one outperforming-ZMH. But do you know how many I recently took that I had to cover for a loss? Way more than you would want to know.

Another Obvious Day Of Distribution For The Indexes

Another ugly distribution day hit all the major market indexes. This reversal with such negative breadth does not suggest the recent lows of the recent rally will hold.

More and more charts are breaking down, and now the oils are joining the retail, REIT, real estate, and tech stocks going lower. I am sure a sector rotation will seem obvious soon enough. I do see a lot of nice action in certain medical stocks. I am not sure how bullish that is. My guess is not very.

I dont like the way this market looks and until there is downright capitulation -- put/call ratio 1.2, bullish/bearish newsletter # cross, and a high VIX -- I will bide my time with tiny buys and tiny shorts and keep my cash nice and cozy for better oportunities to ride the wave up.

Good luck out there.

New Swing Longs: BBBB PPDI STJ PBCT

Longs Outperforming Market: LDSH CRED HOM ADST

New Swing Shorts (choose wisely): TRW LSS OMM OXY THO XOM ICUI SLB HYDL APC PPP DSL TRZ DRH

Shorts Outperforming Market: PQE NVR WLS PHM LEN IPCR NAV NJR ALB VCG MAS DUK CNSL

Markets Close Near HOD; However, Volume Was Much Lower

A nice last hour of the day made for a nice close near the highs of the day for all the major market indexes. Volume was lower, sadly, indicating a lack of institutional investors willing to put money to work. I am sure earnings season has something to do with this.

The very short term trend has turned up but besides that there is not much else bullish about the overall market. Even with bearishness creapin higher, volume is lacking on the upside and breadth is still very poor. With that calling for a bottom here seems way too premature.

Down days on higher volume followed by rallies on low volume is not what you like to see if you are bullish and looking for a meaningfull bottom. Normally the last leg lower will have lower volume and the subsequent up days will have very noticable increase in volume (think March 2003 bottom). Until I see that it makes it hard for me to think any solid bottoming is actually happening currently in the market. We still need more bears in the market, however we are down quite a bit and a relief rally is deserved.

Since it is day four into the most recent rally attempt, we have to now look for a 1.5% move to the upside on an increase in volume. If that happens it will be safe to start looking for great stocks breaking out of great bases. Until that happens, keep cash heavy incase we reverse to new lows.

The markets can follow through out of nowhere. You never know what it will do tomorrow, so stay on top of leading stocks in leading sectors and take your cue from them.

Have a great Tuesday. Goodnight.

New Swing Longs: HOM ALO OXM AH WBMD FWLT NT CAMP

Longs Outperforming Market: KNOT PRLS LWSN BRLC AKAM GES BCRX TSAI THRX

New Swing Shorts: OMI

Shorts Outperforming Market: GPRO QGEN IPCR

Small Stocks On Radar Screen: AKN KNAP

A Lot Of Negative Energy Remains In The Air. Is It Really That Bad Out There?

New Swing Longs: ORCC MACR AZN THRX SLW

Longs Outperforming Market: MGN BCRX CHIC SYS MESA TSAI PGR ASGN

New Swing Shorts: POOL

Shorts Outperforming Market: QGEN PII SONC

Markets Mixed On Low Volume; No Power To Bounce

I covered a lot of my shorts today that did not work the past two days and continue to hold the shorts that are working. Any short that has not shown me a gain has automatically been completely sold. The ones that have shown a profit from day one will be held for further downside possibility.

The market is due for a bounce but since the volume is light and there is not a lot of charts to pick from I can not see how this could last that long. However, I could be completely wrong. It wouldnt be the first time.

We will see what comes from this lazy bounce by the Nasdaq in the next couple of days. Until then continue to keep cash high and have very tight cut losses on the positions you do take.


New Swing Longs: SMSC FAST LRCX FELE

Longs Outperforming Market: SYS PGR IVIL

New Swing Shorts: QGEN

Shorts Outperforming Market: JRCC CNTF DXCM MT BOL ALDN BUCY DUK VOLVY CNSL

Markets Suffer Another Distribution Day; Getting Ugly Out There

I am not sure what tomorrow will bring but I can say one thing: This market is ugly. Unfortunately, it is not ugly enough to have a long-term meaningful bottom. As each day goes by the charts in my scans get uglier and uglier. I have very few nice charts and the ones I do have are not that nice. The shorts on the other hand have been working really well. That combined with all the fresh charts breaking down tells me that there is more downside to come in the short term.

A bounce should be expected though, since the market can not go straight down. And if it does go straight down, I think we could have an October crash. But I really doubt that is going to happen and see any rally just leading to more selling later on.

How to know when the downtrend is done? Wait for the stock market major indexes to close up, then watch for a follow-through accumulation day in the next four to seven sessions. A follow through day normally consist of the markets closing up 1.5% or more on volume much heavier than day before and the volume also being above the 50 day volume average. If you get that along with a lot of beautiful breakouts on well formed stock charts you will know it is safe for the time being to go long again.

Beautiful green charts is something that is not out there right now and it is going to take some time for those pretty charts to show up again. While that time passes, keep cash high and keep paying attention to the market. That way you will be ready when the market is ready to go into a bullish uptrend.

New Swing Longs: PGR XTXI SSY

Longs Outperforming Market: ADST-78%, TGC-102%, SYS IED ESLR BRLC

New Swing Shorts: DXCM RGLD SINA ALB CRI PQE BHS CNSL

Shorts Outperforming Market: LZB-20%, CNTF-49%, EVVV-25%, LEND-21%, THLD-16%, NAV-15%, RUTX NVR NDE CORS PGL CBL NJR LEE TRID LTM BUCY CMLS BRKL ALDN KERX WLS LEN RAS

New Short-Term Lows For The Indexes

I don't know about you but the market keeps getting uglier and uglier. The good news about that simple observation is it gets us closer to a low.

Unfortunately, I don't see that happening any time soon. I see a fresh new batch of shorts tonight on my scans and know some of these will reap good gains with their TERRIBLE patterns. You don't see charts like this in a bullish market. The trends are down and there is not much us to say besides that.

The bullish/bearish newsletters, put/call ratio, and VIX will give us a clue when the bottom might come and they are telling us there needs to be much more downside before any extreme is put in.

With all the ugly charts, longs I have been selling and trimming, and lack of new buys showing up I think it is safe to say any rally that happens anyway will only be sold.

The damage is all around and it will take time to recreate nice beautiful bases for a successful run to new highs. Until then, relax and keep cash high (unless you are a master short seller).

The market will stop falling one day and launch a great bull again, just like in March 2003. The earnings are too good and the market is not that expensive on a trailing, current, and forward looking P/E base. And like I said before, unless earnings crash-which they are not-the uptrend that will come about from this downtrend (bear) period should produce wonderful gains.

Until then, the market sucks for longs and continues to treat the bears with the spoils of the bulls. But don't take this to mean it is just time to short anything and everything. You have to be selective and be prepared for a big oversold relief bounce at anytime.

Prepare for every situation you can foresee coming and nothing will catch you off-guard.

New Swing Longs: TSAI CHH TESOF

Longs Outperforming Market: NDAQ-185%, TGC-95%, BCRX-88%, ADST-60%, AOB-22%, SYS MESA BRLC VICL MTN

New Swing Shorts: TRID GNSS LTM BUCY CLS CMLS DBRN BCR LEE WFSL NVR BRKL VOLVY ALDN KERX DHI MWIV ISE

Shorts Outperforming Market: TNH-28%, WCI-19%, EVVV-16%, LZB-13%, VCG BOL NAV

Small Stocks On Radar Screen: VLGEA TRT TOD LRP PZA GROW DASTY

Sellers Start Taking Control After One Day Bounce

After moving higher early in the day, the markets reversed to finish near all of their LODs (low of day). Volume was lower on the Nasdaq offering some comfort to overextended bulls but volume increased on the NYSE giving yet another distribution day to an index that has been under attack by them for three weeks now. Now is definitely not the time to be overextended on the long side with so much clear distribution in the market.

There are still zero positive signs on the horizon, with the ugly technical picture of the indexes along with all the broken charts. That along with the lack of emotional selling could paint for a long slow decline. But we will cross that bridge when we get there.

In the meantime, strength continues to get sold quickly and sellers continue to press it to the downside. That is bearish for the market. Until that pattern changes it is safe to stay defensive and wait for the trend to once again become your friend.

Until then, all news is bad news.

New Swing Longs: MSM NMTI FII VICL GCOM

Longs Outperforming Market: NDAQ-173%, SYKE-64%, BCRX-62%, NFLX-62%, RCCC-60%, APT-59%, CRXL-27%, FDG MGN BRLC

New Swing Shorts: THLD DFG BOL BWA NETL

Shorts Outperforming Market: TOL-20%, PHM-17%, WLS TEN LEN MGA RAS RYL CTX EVVV RUTX

Stocks with percentage after them represents the total profits on original position. The stocks without percentages are either new longs/shorts or have not gone up 25% yet or (for shorts) have not gone down 15%.

Dead Cat Bounce On Low Volume

The market stopped the downtrend with its oversold bounce on Friday. Dont get too excited this should just be a small pause before the downtrend continues.

New Swing Longs: CRED PNRG GES IED MTN EE DEZ AU TLWT RL CEF

Longs Outperforming Market: BCRX NDAQ CRXL ADST TVIA NFLX MGN SYS BRLC

New Swing Shorts: JAH ENCY

Shorts Outperforming Market: CHKP JILL

Market Continues To Weaken; EOD Short Term Oversold Bounce

The major indexes all finished down, again, today. Breath was very poor and volume rose heavily across the board, giving the markets yet another distribution day.

The good news behind this was the oversold bounce we got with about one hour left in the day. This oversold bounce helped relieve the downtrend of aggressive selling pressure, which gives comfort that the bulls can bounce this for a day or two.

But besides that little ray of light, there is nothing else shining out there. Inflation and the Fed going strongly after it and the asset bubble in the housing market is not a good recipe for stocks. So once again keep raising cash and dont be aggressive with any long side trades until the market has given a clear signal the downtrend is over. And just by looking at all the charts out there that have been taken out the past week and the few strong charts that are in decent sectors, I come to the conclusion that a bottom is nowhere near at these levels.

At the same time I am hearing people talk of a "crash" coming. Nope. Sorry. It is not going to happen.

There is too much program trading happening in the stock market to allow that sort of thing to happen. Besides that is the simple fact that stocks are still basically cheap. Unless P/E ratio's start to contract--P/E of SP500 is 18--there is no way a crash is going to happen with stocks this cheap. I believe back in 1987 the SP P/E ratio was around 28 or so. That kind of froth mixed with the current technical situation of then indexes could lead to a crash. But at these levels, I TRUELY DOUBT IT. Also is the fact everyone is talking about a crash. Crashes happen when no one is ready for it. So "Black Monday" probably is not going to happen. LOL.

New Swing Longs: FDG BAB NEM LWSN SYS

Longs Outperforming Market: IRIS AAI SYKE PEP

New Swing Shorts: CHKP CIB GPRO SJT VCP WLS LUFK PETM ADI BJ

Shorts Outperforming the Market: AMHC MTH VLCCF KNXA JRCC EVVV TOL WCG

Small Stocks On Radar Screen: SA

All Stock Market Indexes Are In Downtrends; Raise Cash

I have been too busy with persoanl issues to post. But just know the market is very weak and all the indexes have rolled over into downtrends. The downtrends are on a short, sub-int, and now intermediate time frame.

Raise cash and if you know how to short-fire away. I sold down a lot of stock today and will sell some more tomorrow. With that I have also increased my short positions.

Great luck and if you have been reading this blog the past two days should not have come as a surprise.


New Swing Longs: BEAV OXGN PEP MTIX

Longs Outperforming Market: TGC NDAQ SYKE CRDN ANAD CGPI

New Swing Shorts: MGA HBHC NSS TEN MT RDK MON NJR NDE BMY HC TNP KDN DUK CLI CBT JILL NTLI BMO AEE

Shorts Outperforming Market: WMGI LZB PII HDI MTH LEA PHM VLCCF ACAT PGL WNC RMK TMA UTR CBL FO ACS RAS NHP RHD

Small Stocks On Radar Screen: SAVB TRT MGP TOD

Distribution Day For The Stock Markets Major Indexes

Stock Indexes fell across the board on heavier volume than the previous two days during the EOQ markup. What made the selloff worse is how it started. The markets steadily were marching up till the middle of the day when all of a sudden the selling started, picked up, and never stopped till the close. That gave the feeling of clear institutional selling.

The Nasdaq failed to breakout above its 50 dma which is not very positive, considering how the market is acting recently. With it now failing at this average again, we can assume path of least resistance is definitely down not up for the Nasdaq. As for the other indexes it is still hard to come to a conclusion on them for now, except to say the look very weak.

Raising cash and protecting profits is very important at this juncture right now. Selling longs at first sign of weakness is necessary to preserve cash for better times.

REITS and Homebuilders look like they are ready to rollover AGAIN to the downside. A lot came up on the short scan again today breaking below key support. Since these were the market leaders past three years I dont see how this could be a good thing.


New Swing Longs: IRIS BRL DVA CHIC SWW NT CAMP TEVA ENTG

Longs Outperforming Market: TGC BMD BTUI APT RBA CMED BTJ ASF MESA RCCC BCRX REGN AAI LCC

New Swing Shorts: UTR NHP MAC RAS RMK ANGO CBL

Shorts Outperforming Market: VLCCF RYL TMA RHD NCTY

A Day Without A Conclusion

Stock indexes opened near their highs for the day, then in very choppy trade moved lower to eventually close near their lows of the day. Neither the bulls nor bears really took control as the indexes ended mixed inbetween .2% points up and down.

The market action was very boring, as far as the indexes are concerned. It appears, for now, that is what we have more of in the future, since both sides have a weak argument. The bulls and bears argument are both boring and getting quite old. Hearing the same arguments day after day gets REAL OLD and helps NO ONE.

On the other hand, the action in individual stocks paints a different picture. As you can see below there is plenty of action in individual stocks. Unless you have HUGE 300 to 1 kind of daytrading leverage on the indexes, stocks is the only place to make BIG money right now (not including smart option trading, of course).

The caveat: They just can not be any stock. You want stocks trading above the 50 and 200 dma, have huge volume surge coming out of a good base, are in a strong sector--top 20% of 3 or 6 month price performance, and PREFERABLY has great fundamentals or a nice turnaround in fundamentals. Of course, there is more, but if you always look at the stocks I take everyday, you will soon be able to see the patterns in them. If you dont know how to find them, remember I wrote a Worden Submission in early June. I am SirAloha.

New Swing Longs: CTHR HDB CMED ABAX PDLI KEM SKIL BRLI JDO RDY ALFA CDMS

Longs Outperforming Market: SMTS MCF(50%) ARD(80%) TGC VRTX(55%) SSFT GMXR(90%) AKAM HOKU MNG FIX ACPW ZIGO DCEL(225%) RG(45%) ANAD DESC(135%) PRLS(135%) MXWL FLSH BMD(130%) SYKE(40%) BVF KNDL(125%) TMWD AAI LCC NRPH(50%) ALSC CGPI BTJ---------A lot of the same names you see everday (stocks up over 40% since original purchase)

New Swing Shorts: RHD DLX ACS

Shorts Outperforming Market: NCTY WCG VLCCF WMAR

Market Still Cofused But Nasdaq Follows-Through

This "title" line comment is refering to the last two days, since I did not comment on Thursday's market action.

The markets were up .01 to .5% today, with volume lower than yesterday. So there is not much to disect in today's market action. Yesterday, however, was a very good day for the Nasdaq as the index followed-through from a 5% decline. Not quite the decline you like to see before a start to meaningful rally but with the markets strength and all the good stocks I have I can not argue with the trend.

REMINDER: The above paragraph refers to the very short term trend.

The end of the quarter mark-up by mutual funds might have influenced the volume figures on Thursday, but since we dont know we have to go by the facts we have and those facts say the short-term trend has turned up (again).

I am neither bullish or bearish at this point, but I definitely can see how we can go higher with all the negative chatter. But it is starting to feel like that is all the chatter people like to hear. Well not me. And that is why the past two years while market has flatlined I have doubled my portfolio.

Instead of focusing on the negative all the time, you should try to take advantage of the negative situation and find a way to profit from it.

For now, we continue to wait, till an obvious intermediate trend becomes clear. Until then the long side still is providing much better oportunity to make money than the short side. That confirms that this market is still not ready to puke yet. But when it does, I wont hesitate to raise cash and start taking more shots at the short side.

Have a great weekend!

New Swing Longs: CHNL KG CLB GV GGR AKAM LCC CHKP SSTI WPI IT ALSC

Longs Outperforming Market: BMD(100% club) PRLS(100% club) ADSK EMKR VRTX TFSM NFLX SIRF ESLR AAI TMWD MXWL IVIL ENER DESC TRMS HOKU

New Swing Shorts: WAL FRZ PORK VLCM RACK MWIV KNXA RDEN ZNT

Shorts Outperforming Market: RUTX LHCG

Small Stocks On Radar Screen: ARCAF PMBC CTIB STFC BKRS BDMS SDAY IVIS EFJI TIWI SVA ISRL HWK

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