Monday, January 29, 2007

Wrapping Monday

First things first - I won't be posting for a couple of days because Marlyn is taking his bride for a brief vacation (yes when you are retired you still call it a vacation).

Ok - someone tell me - what happened at 1 P.M. EST when the bottom fell out of the entire market and every index began dropping like a stone? Then around 2:15 or so the engine coughed to life and they all turned around and began climbing again. One notable item in all of this - IWM didn't go down as rapidly or as chaotically as did the others and it recovered a lot quicker. That is probably an indicator that we are entering the time of the small caps once again.

I didn't do much today - still holding a potful of Q's and KKD and CRVL. Bought some LUV for a 3-day swing trade as well. Maybe longer if it holds the line and continues to go up. I bought it off a dummy spot.

I believe the Q's will go green this week and as soon as I'm profitable again (and that isn't too far from here) they're gone. CRVL hit the $46 sweet spot this afternoon and I still haven't decided whether I'm going to double up or sell. I'll be around tomorrow morning at the market open and will decide then. It sure is a nice looking breakout pattern though so I'm leaning towards the double. I'm profitable again with KKD but I'm letting greed dictate that trade - once again I'm holding a stock that I only wanted to day trade but I have no good reason to sell it - the profit isn't good enough yet nor is there a loss sufficient enough to cause me pain.

GOOG reports earnings Wednesday and according to Adam over on Adam's Options the market is expecting a $35 one way or the other move. For everyone holding GOOG here's hoping that the news will be good. I think it is possible that YHOO's beating the street last week might suggest that GOOG will also beat - but I wouldn't run out and game the stock based on my thinking. And you also better keep in mind that YHOO, since its big bump up last week, has been making its way back down. MSFT too has lost the momentum its pseudo-good earnings story gained it. But as I said in these pages several weeks ago, MSFT was due to come back in because it was too far away from its 21-period EMA on the weekly charts. So this is a good thing. The daily charts tell a totally different story in that it is bumping its butt on the 21 period. I'd be hard pressed to buy it at this point - I still think it is over its top of $30.

There are a huge number of stocks that look poised to go up - it's just going to take some kind of catalyst to get them moving. AAPL is a good example. From all the Doji it's been throwing off for the past week or so you can see how the Street wants to buy it but for some reason they are afraid. You be afraid too - at least until you see some movement.

For tomorrow the up/down ratio is at 51% which is as neutral as you can get, but the new 20-day high/low ratio is 67% which is not very good. On the other hand the VIX is back in the 5-10 above the 10-period moving average and there was a split in the last hour of trading with the indices - two white, two red, 1 Doji. Confusion ahead of the Fed. I'll forecast an up day tomorrow. Just based on the VIX and the action this afternoon.

The magic coin says - - - heads - bull market. Well we agree again.

I've got to call today a tie just because some of the indices finished green and others finished red so the score is now Marlyn 7 - 5 and 2 and the coin is 5 - 7 and 2.

I'll be back on Thursday. In the meantime keep pushing the market up.


estocastica said...

Have a great vacation. Look forward to your return.

Bullish Jim said...

I was looking at LUV as well. And CAL, too. And I'm a devout airline hater...

Have a good trip, Marlyn.


A great piece of work unbelievable.