Pavlovs Bulls
Well, they rang a bell, and the Bulls started salivating again today. I'm fairly confident, however, that they won't be rewarded for such intrepid buying. There has been a ton of damage to the trend and to breadth, and the sentiment set up suggests some lower prices as well.
DOW: I note that the Dow remains beneath its 21-day.
DJU: The Utilities are a big warning sign for the market.
S&P500: The S&P bounced, but I see the potential for it to be a topping formation.
NDX: The Nasdaq only tested the break down.
QQQQ: We have a 1X short position as a hedge. Add another equal sized short at 39.89 tomorrow if we get there.
HUI: Is the HUI setting up a low? Theres probably more work to do.
SMH: The Semi's are getting hit tonight on news. I'm probably not going to buy these just yet, though I'm a longer-term believer in them.
XLP: Obviously we were trying to buy the XLP on a limit today, not a break out. This speculation could work out going into Christmas.
STEI: Stewart Enterprises is looking good.
AMCC: Applied Micro is gone, as I feared.
LOOK: LookSmart is doing VERY well for us.
VLNC: I think that this action isn't anything to be worried about in the Valence, at least at this point.
ISON: Isonics "should" have rallied today. We have some support, but we'd better see some buying.
MANU: Manugistics is gone.
LSI: LSI Logic looks good on a limit.
CRAY: Cray Labs looks strong on a breakout.
Summary:
This is normally a good time of year, but there are some major draws on liquidity, that may require the market to pullback, in order to absorb the new supply of stock from new issues and secondary issues. We have little reason to be too aggressive, so we will be putting a hedge on.
I do not think that this Bull move is dead, yet, but there is some risk in here.
Be Well, and Trade Smarter Than the Average Bear!
Mark, Doug, and Holly
-The ChartSmarts Team
Current Positions:
Short QQQQ at 39.75, no stop in place. Note Double up order below.
Long STEI at 7.39, raise stop to 7.39
Long LOOK at 1.64, raise stop to 1.89
Long VLNC at 3.31, stop at 3.22
Long ISON at 4.08, stop at 4.08
Watch List:
LSI: Limit Buy at 4.8, stop at 4.65
CRAY: Buy above 4.09, stop at 3.73
QQQQ: Short another full position at 39.89.
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