After the market close 7/20/2006
No Fun, But...
...not the end of the world. It was a bit uglier than we'd thought, today, but it stands to reason that there would be some selling at the 50- and 200-day moving averages. We do need to find our feet fairly quickly here. If we don't, we break up the bullish pattern and may be on our way to take out the lows.
DOW: The Dow held at a fibbo support today. Tomorrow, Microsoft's buy-back could help.
S&P500: The S&P closed poorly, but after hours it's up a bit.
MDY: The midcaps put in a MISERABLE performance. That said, support held.
NDX: The Nasdaq was hurt by the semis which were hurt by this back-dated options problem. I'm not sure why a standard industry practice is being made into such a big deal but no matter what it's hard on stocks.
RUT: The Russell looks like the S&P, except moreso.
HUI: The Miners were weak. I think that they think that the Fed will go too far.
SMH: The semis got kicked in tthe teeth today. The news can't be helping.
OIH: The Oil Serivice stocks got tromped too. Looking like Oil may be ready to fall.
DJT: The Dow Trannies were very weak. That looks like a possible double top.
BKX: The Banks consolidated bullishly.
OCN: Ocwen consolidated today. So far, so good.
KR: Kroger rallied smartly in a crummy market and is making us money.
NRG: NRG Energy is now one of our holdings. Nice relative strength.
CPWM: That's a nasty stick. Watch Cost Plus, if it comes back we want to buy it, but I don't think it will.
NAPS: Napster opened well and then got killed. Let's watch this one for abit.
GYMB: Gymboree probably has a bit more life in it and if the market rallies, we may well get short. I want a little bit of insurance.
CHTT: Chattem showed relative strength. That's what we want. Buy the break up.
CVC: Cable Vision was strong too. Let's buy the break up. Rising wedges are Bearish, but if you break them up, it's very Bullish.
CBB: Cincinnati Bell can really rally. I think it will be relatively easy to get 10% in this one. Maybe more.
RESP: Respironics really did just what we though it would. Look, more relative strength. As frustrating as this may be, we have to be disciplined about controlling risk.
Summary:
The market didn't confirm the up trend today, and the decline did a bit of damage. People are thinking that the Fed is going to go too far. Maybe they will. Of course, maybe the Fed will be more dovish. Regardless, there's good news out there and offsetting bad news. Bigger picture, there are a ton of Bears and the market is likely to rally higher after whatever chop we see. We just have to be flexible. We'll watch for relative strength and buy that, as well as shorting the occasional Bearish set up.
Be Well, and Trade Smarter Than the Average Bear!
-The ChartSmarts Team
Current Positions:
Long 50% OCN at 13.02, stop at 12.64
Long 50% KR at 22.16, stop at 21.51
Long 50% NRG at 48.03, stop at 46.09
Watch List :
GYMB: Short 50% on a limit of 33.91, stop at 35.43
CHTT: Buy 50% on a print of 31.92, stop at 30.63
CVC: Buy 50% on a print of 21.96, stop at 20.84
CBB: Buy 50% on a print of 4.16, stop at 3.98
Changes in Current Positions:
Move the stop up on OCN to 12.64
We are now 50% long NRG at 48.03
Get your two wwek free trial to ChartSmarts-- Click Here
Get your two wwek free trial to ChartSmarts-- Click Here
