Archive for February, 2009|Monthly archive page

Too easy?

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Charts like this that make the downward trend look all too easy are prone to fake outs.

But our strategy has nothing to do with near term jerks in the market.

We continue to hold our Sellers’ Edge bias until proven otherwise…

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Another conflicting signal

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Another day, another conflicting signal.

Wednesday’s distribution cancels Tuesday’s distribution.

At this juncture it seems petty to view each day as meaningful.

Let’s keep the big picture in mind, which shows a dominant trend down…

They're clear sellers

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Nothing to suggest this market won’t go any lower…

Institutions are clearly in selling mode with three days of clear Distribution over the last two weeks…

THE GROWTH STOCK REPORT

The latest take on Jim Cramer

We always love to point out how poorly the media whore stock pickers do. Here’s the latest take on Jim Cramer by Barron’s:

“Cramer’s recommendations underperform the market by most measures. From May to December of last year, for example, the market lost about 30%. Heeding Cramer’s Buys and Sells would have added another five percentage points to that loss, according to our latest tally.

To his credit, Cramer’s Sells “made money” by outperforming the market on the downside by as much as five percentage points (depending on the holding period and benchmark). His Buys, however, lost up to 10 percentage points more than the market.”

THE GROWTH STOCK REPORT

No confidence

Heavy Distribution Tuesday

Heavy Distribution Tuesday

Heavy selling on the day of the economic stimulus package being signed into effect doesn’t seem to bode well for the market.

But despite some Technology names showing some subltle signs of a willingness to rally lately, we’ve long recognized down as the dominant trend.

As long as the major indexes trade below their major moving averages we’re going to be suspicious of any reasons to be long.

The trouncing lingers…

Bear's trouncing yesterday lingers...

Bear's trouncing yesterday lingers...

The market didn’t like Treas. Sec. Geithner’s stimulus plan.

Whether it was lack of details or a ‘sell the news’ scenario doesn’t matter.

The fact is Tuesday’s heavy selling from instituitions sticks out like a soar thumb on the market’s hand….

It’s still no time to buy. Until we break north of the 50-day moving average we’re calling the Sellers in control.

What's really appealing

Heavy buying can only be taken as a positive.

Any rally from here would also trigger short sellers to cover.

But what’s really appealing is the Technology laden Nasdaq perking up with relative strength.

Any real rally needs a driver. Tech would be ideal as vehicle to pull the broader market forward…

And where the Nasdaq has poked above the all important 50-day moving average, the S&P 500 and Dow 30 have a little work to do here.

Where to place low-risk trades

Though the market’s dominant trend is down, it’s been arguably trendless for the past four months as price-action meanders along.

The longer the chart time frame, the stronger the measure in trend.

As down remains the strongest flow here, we’re eying the 50-day moving average, which the S&P 500 is trading just under, as a key hurdle that must be overcome until we consider any change in trend.

Traders hate sideways action.

But to be be clear, we’ll wait as long as it takes to have further conviction over where to place low-risk trades.