Wrapping Wednesday

Been gone so long I've almost forgotten how. As a test of my resolve and discipline during my vacation I went one full week without logging on to the internet. It is amazing how little I missed in that time. The political situation remains the same, the market remains the same, Jimmy Crack Corn Pone stays as crazy as ever and the only thing that has changed is me - I'm a week older and a bit smarter for the experience. I'm going to try it about once a quarter from now on. Can't hurt - might even help.

Oh well - just because we're retired doesn't mean we can slack off. Let's have a wrap -

I expected the markets to be down today and they were split but that isn't anything new anymore. After all there was a new record in the wind. Still you can't have the Dow components up and the tech components down - it just doesn't make sense. I'm not sure how INTC actually made money this quarter while fighting with AMD for market share and cutting share prices while the PC market that is supposedly doing so well is such absolute toast that the retailers are practically giving away desk tops as premiums to get you to come into their stores. Can you say "Cook(ed) Book(s)"?

I sold off GRA this morning because I didn't like the way it was progressing, to wit it lost a quarter in the week I was gone. The rest of the market went the other way and so I'm taking the quarter loss as a sign of concern regarding earnings which are coming up on the 24th. I also sold off OI based on its 20 cent loss in the past week and that too might be concern over earnings coming next week. At any rate I'm taking no chances this particular season. My current positions include KNOT, AKS, and GGB. I increased KNOT this morning off the S2 - it went up to pivot and then dropped back to S1 were it sat most of the day. And I added to AKS also - that might have been a mistake because it too is coming up on earnings and while GGB went up AKS fell back. I'll watch another day or so and then, if it keeps dropping I'll dump out on Friday until after earnings next week. No day trading today - I need a little time to get back my rhythm.

I see the Q's took a dump in the last half hour as did SPY and DIA. That's generally a concessionary movement and it suggests (only "suggests") a down day coming tomorrow.

The three amigos - GOOG, MSFT, and AAPL continued their winsome ways - these are the three most beloved stocks in the entire world because they are so profitable. MSFT had 4 days of gains and made all of 50 cents for its true believers while it continues to meander in the range we identifed about 9 months ago. GOOG is in a rising formation and will probably hit 513 any day now and after that --- boom!--- right to 520 having touched off the world's longest awaited short squeeze. And, as was predicted here first - APPL hit 90 before it hit 100. I wouldn't load up just yet there's more bad news ahead. The only reason a stock declines into earnings is fear. If AAPL puts out a bad number next week it might lose 15% before the first 5 minutes of the trading day.

The cult of MVIS had a good week but then came yesterday and the cathedral of dead money -


so cult fans - I guess it's time to sell and wait for the next pull back.

My model portfolio is printing 13.70% which is OK but a bit disappointing and another sign of future declines (rate of change is dropping). The benchmark is at 4.89%.

The VIX pulled back into the neutral zone but what I find interesting is that the INDU ATR is now approaching 80.


I gave you a two-month view on this one so you could admire my brilliance in ATR reading. I told you that when the ATR rolled over on the INDU we would have a sustained market rise. Well that happened - and, as I've mentioned before - once the ATR drops below 80 it is a danger signal and usually precedes a multi-day correction. It is currently at 82.93. So keep an eye on it.

This guy still indicates market weakness coming -


The up/down ratio says 40% and that means only one thing - an up day tomorrow regardless of what the other indicators are saying.

The coin says ... tails - down day coming.

Going back to last Monday's forecast when the coin won the score stands at Marlyn 24 - 25 and 10 and the coin is 27 - 22 and 10. I always say that I'd rather be lucky than good.

Philip's Set-Up

I wrote in yesterday's Wrap about Philip and the neat set-up he designed and gave to me - and this is a beauty. I will tell you though on a daily basis, while it works and works well, it back tests poorly. I haven't worked that out yet so you'll just have to take my word for its efficiency on an anecdotal basis - for now. Anyway I put together a few charts for you to look at and wonder at and especially wonder why you didn't notice something this simple (I know that's what I'm doing). And I've provided the code for the paintbar on the first chart below and those of you who want to work with it in stockfetcher can derive the SF code from the paintbar code. (Instead of using "[3]" use "3 days ago" for example).

Chart 1 is a daily chart to show the basic parameters of the set-up.


You can see that it is a 4-rule test that takes into consideration four volume bars and two closes. Can't get any easier than this and if you pull up a bunch of charts you will start seeing this everywhere.

But the place where this seems to really work is on the minute based charts. Here is GGB for example on the 15-minute charts. The "green diamond" is the signal device.


I selected this chart because I wanted to show that the indicator didn't fire every day. In this case there were no signals of this type on this stock on Wednesday. Only a couple of tweezer bottoms and only one actually meant anything.

Here are the Q's also on the 15-minute chart -


On this one you can see that unlike GGB there was no gap down on the open and the previous day's signal carried over to the next day (from Wednesday to Thursday).

It also works on the 30-minute charts - here is GRA with the 30-minute version -


That purple bar in the initial slot is signaling an RSI(2) < 2. But mid-day the green diamond appears. That would suggest if you are already in the stock to load up some more for a day trade. Or don't you day trade stocks in your portfolio? If you don't you are missing a great bet.

And finally, on the 3 minute charts which I like to use to play cheap stocks (I use 4-minute on higher priced stocks and then only to watch for turns).


This shows how the signal when occurring around a pivot point is extremely powerful. It also shows that there are no signals on the down leg of the run. I don't know if that is a coincidence but it seems mighty suspicious.

Wraps For Thursday

Ugh - I wasn't up to speed at all today. I don't know when this market is going to go down but this burn up is going to drive me nuts. I don't know where the liquidity is coming from to buy the stocks that are being bought but there is a lot of money all of a sudden available and a lot of stocks being grabbed up.

I added to GRA and put AKS in the trading portfolio. I took some day trades - none of which worth much. I took MVIS off a tweezer bottom this morning and cashed out 14 cents later - whoopie - I just can't bring myself to "believe". Tell me - who in their bleeding right mind can "believe" in this crap - A perfect rounder between pivot points ...


Took a shot at IAAC and that was a wild ride to a 32 cent loss. Then I had PMTC for most of the day and took 18 cents off of it. Between MVIS and PMTC I made up for my loss in IAAC except for three round trip commissions. Fortunately AKS and the added value to GRA more than adequately made up for that loss. But still it was a loss I shouldn't have taken.

I think I'm going to stop with the tech stocks all together - they're mostly junk, selling junk, or, like RACK this morning, junky crap selling junk that absolutely no one wants or needs. The one that I wanted to buy, HLYS, just got too expensive too fast and I just said no.

I wrote about three stocks this morning that I read about on from Notable Calls. PFE made 3 cents, NKTR was dead even for the day and JSDA went up 70 cents. Had I kept the latter on my screen I could have picked up a nice BOB around noon time.

Philip designed and gave me a great set-up and I'll work on it over the weekend and see if my initial take is correct - and that take is something like - wow!. Go read his comment on it under this post. I've been looking at a number of other stocks and finding this set-up in a number of them and it looks like it has a great future in the 15- and 30-minute charts. Thanks again Philip. I am always interested in exploring new set-ups.

The model portfolio lost a smidgen to 11.57% and the bench mark posted 2.77%.

The three Amigos had a booming day - the 471 dollar stock gained 50 cents, the 94 dollar stock gained 41 cents and the other piece of crap gained a nickle - all of you MSFT owners - bet you're feeling rich tonight. In one month MSFT has managed to net 23 cents. That's a one hellofa month there, Clarice. Now if we take that out to 12 months that would be $2.76 cents and that's if it keeps going up. That would mean that you could invest all of your profits in a happy meal and have a little left over for a Moon Pie and an RC cola.

The INDU ATR went up a bit again today but only cents to 104.58 and I still say it hits double digits next week and we will be clean and green until the next world monetary crisis. This guy went up some more and that is worrisome but it went up last time without going down which is one of the reasons why the market is just spinning its wheels.



The VIX once again slipped to 5% under the 10-period moving average and the up/down ratio went to neutral - 54%.

Given the fact that we need a down day but since Monday's are never down especially after three day weekends - I'm calling Monday - down.

The coin says --- tails - also calling for a down day.

I missed but the coin hit so the score is Marlyn 24 - 24 and 9 and the coin is 26 - 22 and 9. Luck is prevailing in this contest - I'm going to have to look for some new indicators.

Wednesday Wraps

Well that was a wonderful day - my key stocks in the portfolio both went up a bit, I bought and sold RI in the space of 6 hours because it round tripped and replaced it with GRA - the stock I should have bought in the first place and a week ago to boot. That was the leader on the must buy list last week and remains number one with a bullet. It gained 3.15% today - of course I bought it late so it will probably lose that and more tomorrow. I added to OI as it seems to be indicating that it wants to run. I'm already overweight in GGB and left it that way.

Took two day trades, XING and TAM. XING I took off a bounce from S1 early and rode it to R1 and made 43 cents on the transaction. Just about the time I was finishing with XING, TAM printed a tweezer bottom just above S2 and I rode that one to R1 - making a buck for the effort. I discovered XING from the BOB set-up filter and TAM came from a gap down filter. Here's TAM so you can see how the trade developed. Very elegant and note that if I had waited for a EMA cross over I would have lost half the move. The arrow is what I have the software print to indicate a tweezer bottom.


And if you don't think I like QuoteTracker - you would be very wrong.

JTX opened up as I expected it would then dropped back then finished up. The specialist didn't get the short squeeze that he expected so it is possible that there weren't that many folks short the stock. It's possible that the drop was so severe that there were very few up-ticks when the stock could be shorted and also possible there just wasn't any inventory to short. It would have been a good play around 27.50 but I had other fish to fry at that time.

I think it's finally time to buy MVIS - two strong days with significant volume suggests that the big boys have finally noticed. I'm going to watch for an entry tomorrow and maybe put some in the portfolio. That'll calm it down.

The model portfolio is up to 11.56% and the bench mark printed 2.43%. It gets easier every day. The shootout is over with my Dead Cat Bounce Filter beating the Rocket - at least in this round. I don't know if there will be a second round - If the Rocket ever outputs another stock I'll do another comparison.

The three pals - GOOG, MSFT, and AAPL had a wonderful day. MSFT won the race with a 2.26% gain and that puts it at the top of its trading range again. It actually went into breakout territory but then pulled back just in time to level off with the last two highs of the past 20 days. Anyone care to guess where it goes tomorrow? My guess is back to 27.90 or so. GOOG flatened off with yesterday's gains and printed a spinner - I.E. - nobody knows what to do. AAPL, having read my critique this morning, went nowhere. Lost 23 cents. This stock has now lost 6 days out of the last 7 and is not even going anywhere as a result. It is sliding sideways. I don't know - I think there is a lot of lost liquidity in these stocks that could be used in other places to make money - but apparently the Cult of AAPLGOOGMSFT is just too powerful and knowing. Earnings are coming - here is my guess - AAPL - makes by a penny, MSFT - misses by 2 cents, GOOG - makes a profit but misses estimates. You read it here first.

The DJI ATR slipped back to 104.15 today and that is excellent - I think it will go below 100 before the end of next week. Unfortunately this guy went back up today to peek over .005% and that usually means a down market is coming -


The VIX remains neutral and the up/down ratio actually returned to an oversold - kinda - configuration - printing 46%. I told you it was an ugly day.

So we have competing up and down indications - I'm guessing tomorrow is more of the same as today with a bit of a down bias. The big guys will all take the afternoon off and only the rookies will be manning the pits. Their orders will be - do no harm.

Then Friday is a day off and Monday the 401K/IRA money starts flowing into the market.

So as not to be ambiguous myself I'm calling for a down day tomorrow - I know it is more of a wish than a reasonable guess but it's all I've got right now.

The coin is saying that tomorrow is going to be a ... heads - up day - the coin never guesses.

We both missed so the score is at Marlyn 24 - 23 and 9 and the coin is 25 - 22 and 9.

Friday's Wraps

Watching paint dry. I thought we'd go down and I guess after this morning's irrational exuberance we were for much of the day. To finish some in the green after that took a lot of courage on the part of the bulls. But as expected we had an up week. Next week is just as likely to be down as up. Unfortunately, the INDU ATR actually went back up today so I'm not holding my breath for next week to be up. I think we might have one or two up days but the rest will probably be down.

Added to my TRA, AKS, and GGB positions, picked up RHT and was stopped out of AMMD. No loss on that - in fact a good gain but for the past two days it went nowhere and you know I hate those low volatility stocks. It isn't anything against the stock just the feeling that I could have the money working rather than resting. And it turns out that I sold off both GRA and TIE at the wrong time - but that's how it goes.

I read a guy's Blog today and he said he's holding 60+ stocks. That's a crime - just wasting opportunity - that's a guy who doesn't know when to let them go. Not every stock is going up all the time - if after a couple of days of no activity you might consider that it is done for this cycle and start looking for something new. Or dump it and put the funds into one of your more active stocks. There is nothing that says you can't reinvest in a stock you already own.

Nothing that I had selected to watch today went anywhere and while I'm sure something was moving somewhere it wasn't on my screen - except RHT and I had wanted a position in that one for some time now. After putting on an initial position this morning I added a bit this afternoon just before COB. I picked up RHT from the BOB set-up filter. It wasn't the only one that went up today but the only one I was interested in owning.

And if you are still doubting pivot points (I know you aren't but it never hurts to see a good example) -

You see how the Q's dropped down, hit S1 around 2 P.M. and then went back up again? That was when all of my holdings went back up too. Except I had added to a couple of them when they were down at their pivot points.

Everyone who thinks that this is a healthy looking stock - well - I don't obviously -

My latest theory regarding GOOG is this - people are selling to get their profits out to buy more shares of other stocks that are on their way up. Since 2/28 GOOG is up .78%, AAPL is up 3.967% and MSFT is down 3.16%.

Some stocks are behaving like nothing happened and I guess that's pretty good. I showed you GLBL the other day and it was just rolling along without a care in the world. Unfortunately I think yesterday it printed a maximum top. I won't publish it here but you know what that looks like - a Doji on the third gap-up day - and that's exactly what happened. Went down a couple of cents today - wouldn't be surprised if it dropped more on Monday.

The VIX is back to 10% below its 10-period moving average and we all know that that is not a good sign. And although the up/down ratio went down to 50% that is dead neutral and can't be relied on to give us a hint. 3 of the 4 major indices we follow (DIA, SPY, and IWM) all printed a white/green candle in the last hour as did GS. Only the Q's didn't but still output a Doji following another large white candle.

The 20 day high/low ratio remains neutral at 1 to 1 --- so in the face of all the evidence - especially this guy -

I'm going to forecast a down day on Monday.

Meanwhile the coin says ... tails - down day too. I've got to get the wheels balanced on that thing.

I'm calling today another stupid tie. The score now stands at Marlyn 19 - 13 and 6 and the coin is 17 - 17 and 6. This has been a bad year for Mr. Marky.

Marlyn will be going on one of his many vacations Monday and Tuesday next - I doubt that I will publish while I am out. I will put a few up over the weekend though and will be back on Wednesday in time for a wrap.

Wrapping Thursday

Market went up and then came back down again. As I said I don't think we're out of the woods yet and until I see some real movement on INDU ATR I'll keep saying - watch your step.

I sold off GRA and TIE - I made money on both trades but they were going nowhere as far as I was concerned - at least GRA wasn't. TIE was starting to move but it is too volatile - and if we do get a drop tomorrow (which I expect) it would have been the loss leader. I dumped it off at the high of the day (coincidental not planned). It would have been around R3 if QT produced that level which is doesn't. It came back down and squatted on R2 for the rest of the day. I added to and subtracted from AKS - I just didn't like the way it was behaving and I don't like having a lot of money tied up in a misbehaving stock. I did add to GGB though and now have it up to half strength. Every time GGB's RSI(2) dropped below 2 today I added some more. TRA was another one that just gapped up to R2 and stayed there all day. AMMD gapped up to R1 and sat on that line for most of the day.

I took a day trade in BRKR - one of Dogwood's new core adds. I hit it the first time on its pass of R1 and then when it went through R2 and came back to R1 again I doubled up. It went back up another 20 cents and I dumped out for a nice profit. It sat there for most of the rest of the day and then came back in a bit.

I watched LEND almost all day and then missed the BOB this afternoon. Oh well - what can I say. A reader took me to task for saying in my Having Trouble post that you should only have about 10 charts up - said he wanted action. Missed the point - that post was for people who needed a couple of solid wins to get their mojo back and not a lot of action. But then I got to thinking about it - I make money nearly every day and seldom have more than 6 or 8 charts up and another 5 to 10 stocks on the watch list. But that's what this filtering stuff is really all about. Finding likely candidates to watch. It's the same as hunting or fishing. You explore during the off season and find the most likely spots - then you go to those spots when it is time to catch something. A little bit of skill, a little bit of luck and next thing you know your bag is filled. Same with trading - a little bit of skill, a little bit of luck and next thing you know your trading account is filled.

The model portfolio is at 2.23% and the benchmark is .25%. I'm still kicking myself for not grabbing RYI when it was cheap. Still waiting for the aftershock - sometimes it's bigger than the initial shake. I will grab some on the next good chance that I get.

Of the three pals only AAPL managed to get some green today - MSFT and GOOG were both down. I don't know what is going on with GOOG - I will guess that there is just too many good stocks available right now and people just don't believe in the BS any more. It concerns me greatly that it is not participating in this mini-rally and that probably means that it is no longer everyone's darling. And besides this is one ugly looking chart - no wonder no one is buying it.



Of course if you look at MSFT's chart you will see a piece of toast - it is so done it's a cinder. I think people probably laughed at me when I started saying that 6 months ago - they aren't laughing any more.

The INDU ATR is down 34 cents from its peak a couple of days ago. Which means it is down 19 cents more than yesterday. Does this remind you of paint drying? One big drop and it is back to where it was and then some. I'm planning a post on this later, maybe this weekend, to explain exactly why you should be more interested in the ATR than the VIX.

The VIX of course no longer has any fear premium at all and is more than 5% below its 10-day moving average again. That took all of 9 days to accomplish and that is absolutely incredible and absolutely wrong. Keep in mind the accident of the calendar - this is the 401K-money-into-the-market week. To be honest I think that is about ended by now and that we are going down a bit tomorrow. I believe we'll finish the week on a green candle - we usually do after a large drop but not as high as it is today.

This indicator is again in over bought territory.


And pretty high at that. The up/down ratio is at 61% which is part two of the equation and the new 20 day high/low ratio is about 1 to 1. And 4 out of the 5 market indicators that we watch finished the final hour with white/green candles. That is never a good sign.

My forecast for tomorrow and one of the reasons why I sold out of TIE and GRA today is for a down day. I may reacquire both of those tomorrow because I still think they are good companies to own but we'll see then.

The coin, having waited patiently through all of the above crap for its chance to shine says tomorrow is a ... tails - down day - I'm going to start flipping this thing before I write my call.

The score now stands at Marlyn 19 - 15 and 5 and the coin is 17 - 17 and 5 which makes the coin exactly that - a lucky coin.

Have a good day trading tomorrow - and yes, I know I still owe a post on ATR comparisons. I've got the data I just need to write it up.

Tuesday Wraps

Well that was better. This indicator - NewMoMo - seems to know what it is talking about.


Who knows maybe they'll name this one after me - Marlyn's MoMo. Wouldn't that be nice.

I bought both AMMD and ACOR but ACOR proved too volatile for my tastes and I dumped out of it soon after the purchase. I increased my position in AMMD this afternoon. I also increased positions in AKS and GGB this morning early. TIE and GRA remain the same. Although I should have played TIE a little more aggressively but of all my holdings at the moment it has the highest ATR and that still has me worried a bit even though it is falling while TIE is going up. I might put a little more on it tomorrow if the ATR continues to fall.

I picked up AMMD just as it passed through Resistance 1 at 19.73. It went right up to resistance 2 and if I were day trading it that would have been where I would have sold it for a nice quarter profit. But I'd already decided to hold on to it so I did and then I added to it when it crossed R2 again. You can play the pivots high or low - high on a gap up and low on a gap down. If you don't use them you should take the time to study them and start.

The VIX dropped way down today and that too was expected but until it drops more than 10 below it's 10-period moving average we are probably going to continue going up. The INDU ATR continues to increase and note that in order to be sure we have hit the bottom it should start decreasing. It is 174 and change today and yesterday it printed 166.29.

The model portfolio is -.30 and the benchmark is -.42 and for the first time in a week we are ahead of the benchmark - not by much but every little bit helps.

The three pals all went up today and that wasn't hard but GOOG led the way at 3.77% followed by AAPL and then MSFT. GOOG hit that flat spot from 11 to 1:30 or so and then just started climbing through the rest of the afternoon.

Now for the news - the reason why the market went up today wasn't because it was completely oversold - no sir - the reason why the markets went up today was because of investors being encouraged because the "world" markets went up today. The fact that factory orders were way down had absolutely no effect but had the market gone down - that would have been blamed. Clueless - just clueless. Absolutely no mention of the fact that the Yen is cheapening thus taking some of the edge off and certainly no mention of the fact that billions of dollars started pouring into the brokerages today in the form of 401K money - no - just encouragement because the world markets started recovering. Right.

The 4 major indices that we follow all printed red/black candles in the last hour and that is a good sign. The up/down ratio however printed 73% and that isn't so good - too much exuberance.

Regardless I think we could have another up day tomorrow surely all the dip buyers aren't gone yet.

Meanwhile the coin says .... tails - thinks it will be down.

The score now stands at Marlyn 17 - 15 and 5 and the coin is 15 - 17 and 5.

Wrapping Monday

Drifting - that's the only way to describe it - at the open they gapped down to S1 or S2 then reversed and went to the pivot point and then reversed back to mid-point low (between pivot and S1) and hung out there for the rest of the day until 3:30 or so and then they just collapsed down again.

I scaled up in AKS and GRA, re-acquired GGB at an initial load. I tried to day trade MAS off the ATR/RSI filter but it reversed on me soon after I bought it. My biggest loser remains TIE. But as I showed earlier in my post on pivot points it too did the S2 to pivot point run this morning. My only regret is that I wasn't day trading it at the time. I am so glad that I dumped out of XING last week - it was down another buck and a half today - I guess it's China's stocks that are going to be punished for awhile.

The model portfolio is down 3.58 and the benchmark is down 1.5. Still not looking too good for the home team but it's early yet.

This is a good chart -



That spinner today is a sign of indecision and it could mean that the down side is done for a day or two - before you get all excited just keep in mind that it doesn't mean that the correction is over - I showed you this weekend what we need to see for that to happen - the ATR rolling over and turning down.

I looked at a lot of charts today and almost every one of them had the same look about them in the ATR and RSI windows. So we are going to have a lot of company when the market finally does turn.

The good news is the NewMoMo finally turned and as I said we might get a couple of days of respite as a result. Don't go wild - it too could turn on a dime.



I understand that CNBC is going to cover the open of the Asian markets and isn't that a waste of time. This chart tells you everything you need to know and it is continuously active 24 hours a day. Between now and 8 P.M. it shouldn't do much and then it will start coming alive again.



For those of you who are chart watchers you saw this pattern today in the US markets - imagine that. Of course you won't see this on CNBC because they are clueless.

The three technicators (GOOG, MSFT, AAPL) had a mixed day - AAPL was up the most but it too reversed after its initial run. GOOG was up about twice as much and closed mid-range. MSFT dropped another 20 cents or so. This is going to be a slow death I'm thinking. I read today where AAPL is actually starting to capture desktop and laptop market share. It's about time.

Oil and gold fell today - I don't know about you but I need some gold every time I pull up to the pump around here. Folks who know are saying that oil should stabilize around an average price of 70 dollars a barrel this year. I don't know - I don't follow it very often and I haven't a clue what the dynamic is. All I do know is that the world will run out of it eventually and even though I'll be long gone by then I'm pretty sure it will come as a surprise to our political class.

The VIX remains in an oversold configuration and the up/down ratio plunged to 18%. These two things coupled with the last hour meltdown in all the indices and GS means an up day tomorrow.

So once again I'm forecasting an up day - one of these days I'll get it right.

Mr. Magic Coin also says heads - up day tomorrow.

Well we missed another one and it could have been a slam dunk for one of us at least but - whatever - the score is now - Marlyn 16 - 15 and 5 and the coin is 14 - 17 and 5. We are back to just a tad better than luck.

Friday Finally Wraps

Oh wow! - The only thing I made money on today was the day trade I took this morning, STRL, and also on AKS. I took STRL off R1 as it passed it from the pivot and rode it past R2. When it turned around I sold it and pocketed 39 cents. My RSI(2) < 5 filter output STRL plus many others. I put the top 10 in a Quote Tracker portfolio then watched for movement.

I sold AKS early to lock in the profits and then re-acquired this afternoon as a result of a 15-minute BOB. I was stopped out of GRA this morning but bought it back again this afternoon at the S1 pivot point as it looked as if it were going to rally there. It went down some more and then turned around. Despite the drop, TIE remained above the stop loss so I still hold it. That leaves AKS, GRA and TIE in the trading portfolio the rest either stopped out, or, as in the case of XING, sold off.

Costly day all told but if it weren't for stop losses and the two profitable trades I took it would have been worse.

The market is seriously oversold but the dip buyers should be out next week as it is time for the 401K money again. The three friends (GOOG, MSFT, and AAPL) all lost with MSFT being the winner as it only dropped 11 cents. GOOG continues going down and someplace down here it has to hit a rally spot.



It could be trying to close the gap between 420 and 460 and maybe 420 is the rally point. It is, after all, still 100 points higher than it was a year ago so there is no need to panic just yet. It also has dropped though the EMA 90 and the last time it did that it hurried back up and passed through it again. Next week the 401K money hits and if GOOG is going to move it will move then.

I'm still not certain what happened to gold and silver this week - generally in a market decline you would expect to see them become more valuable because that's what the gold bugs want to have happen (you can tell that I'm joking - right?). If the gold bugs really knew what they were talking about gold would be over $2000 an ounce right now. Obviously a lot of people who have huge sums of money don't believe that gold or silver are viable investments and would rather put their money into something with real value. Today that was CAPS -



Just 1 among 1788 other stocks that went up in value today - of course none of them was in my portfolio. That makes the up/down ratio 22% - that is deep in oversold territory.

This morning I ridiculed Jimmy Crack CP once more and showed you FRO and DGX. After I put them up they both flattened out and pretty much stayed right where they were for the rest of the day. Still the stock he "nixes" is the one going up while the triple buy is going down - I feel sorry for the DGX buyers - especially those who bought because he said buy, buy, buy.

The model portfolio is down 2.04% and the benchmark is down 1.03%. Not a good showing. But Monday will be better.

Here's some good news - at the end of the day the Q's RSI(2) was 1.26, the DIA was 2.35, and the SPY was 2.02. Most of the stocks in my model portfolio are under 5. Earlier this week we talked about setting a filter that only keyed off of stocks that were RSI(2) < 5 when the SPY was also RSI(2) < 5. Well - guess what - we have a real time filter beginning Monday. This ought to be pretty good.

This indicator is really, really, really oversold now - this is lower than it was back in the summer last year. Not by much but enough.



Take it all together and it spells up on Monday. Of course I'll be going against all the wimpy traders who passed around a rumor all afternoon that the market was going to collapse on Monday. But as always - if you aren't fearless you don't belong in this business. And, needless to say I'm not perfect either - but either way the market goes you have tools to take advantage of it - so do so.

Meanwhile the coin says ... heads - also looking for a bull market.

Having missed today by more than a little the score is now Marlyn 16 - 14 and 5 and the coin is 14 - 16 and 5.

Going to have some great posts this weekend so come back often. I'm also going to start looking into RSS for the site - I'm sure many of you would prefer that to atom - whatever that is.

Thursday Wraps

What a mean, miserable day. The market players couldn't make up their minds whether they wanted it up or down. This is standard procedure after the beating Tuesday - every body is playing scared. As a result stocks are round tripping and we spend all day long bumping against the pivot point on the Q's -



Five times in six hours it hit the pivot (black line on the chart) - each time to rebound strongly. But as you can see yesterday was the same thing - inability to move through the pivot point. That suggests a difficult day for today.

I bought PAAS this morning and watched it go up and then it round tripped on me and I sold it off for a small loss this afternoon. That was the very first and very last time that I will buy a silver mining stock - I've always considered them to be a waste and I think this one is the biggest waste of all.

I bought TRA this afternoon and GRA and I may scale into DLX and RYI tomorrow. All I will do now is add to the portfolio on dips and let it run for awhile. Tomorrow I think I'll go back to day trading. TIE pretty much round tripped on the day too and if it doesn't get some steam tomorrow I'm going to dump it. I'd rather put the money into winners like AKS or RIO. XING came all the way back to where I bought it but I'm going to hold on to this one for awhile but I won't add to it. It has to prove itself and it couldn't even get to the pivot point today.

The model portfolio is now returning 1.23% and the SPY is returning 1.01% since inception.

The three guys (MSFT, GOOG, and AAPL) went their separate ways today. AAPL did real well, up 2.45, MSFT recovered from being down early and GOOG stayed down. I'll reiterate my message from the past couple of days in various posts - AAPL is going up, MSFT is range bound and will be forever, and GOOG is done. It had huge volume today and went nowhere.

The small caps are back - IWM made it into the green today.



That isn't unexpected the small caps have been taking the brunt of the beat-down because they have been so far ahead of everything else. But once again the pivot point was the line of demarcation. We need a break over the pivot point tomorrow and then we'll see what happens next.

The INDU ATR is above 144 which is always a good sign. I use the ATR as a proxy for volatility. When it is below 80 for the INDU the Dow 30 goes down and when it is above 120 the DOW 30 goes up. Not immediately but within days.

This indicator, NewMoMo is behaving normally - it is now officially really far down -



Any upward movement in the market tomorrow will spin this around on a dime and give 9 cents change.

The up/down ratio retreated to 33% which is violently oversold and the VIX remains more than 10% over its 10-period moving average. It must go back.

I'm calling tomorrow up. Although to be honest I prefer days like today for day trading.

The magic coin meanwhile, fresh off its success in calling today's market, calls tomorrow ... heads - bull market.

The score is now Marlyn 16 - 13 and 5 and the coin is 14 - 15 and 5.

The Edge

Let's say that the fundamental nature of most of the stocks that were crushed yesterday had nothing to do with their crushing - just that when a beat-down happens during a riot everything gets beat and names are taken afterward.

Let's also posit that the crushing was a bit overdone - as seems to be the sober consensus this morning.

And even though Europe and Asia are still being crushed - Europe is looping back up and the futures are massive green. What does that leave us?

Well let's say that you were to write a filter and what you would look for were stocks that up until Monday had appreciated more than 25% in the past 66 days and dropped more than 5% yesterday. (All of these numbers are totally arbitrary). And if you did that what do you think you would find? A long list of stocks that up until yesterday most every body wanted to own.

Then let's say you then went through these stocks looking for ones with smooth, ever-rising closing prices for the past 6 months or so in the range of 15 to 35 dollars with high average volume and ones that you'd want to own too or maybe even ones you'd owned once in the past - what do you think you'd get out of that? About 30 matches among which we find -

AKS, RIO, TIE, TRA, GGB, PAAS, SINA, RYI, GRA, SSRI, ICON, DLX

And I'm calling this short list "my recovery portfolio" and let's see where it goes.

And if you think I am the only person who is doing this at this time of the morning (4:30 A.M. EST) you are nuts. There are 8500 fund managers out there who have ordered their minions to do the same thing - because we are all after the same thing - the edge.