Another Bumpy Ride - Advantage Bulls

The market gapped up nicely this morning and then knee jerk selling came in - me included in the case of SRPT, which I sold pre market up $1.65 and tweeted about at the time. After the initial sell off the Dow was down by around 100 points at its low. But he other averages, especially the NASDAQ which never went negative, did not get hit to hard.  Eventually the entire market came back and there were some decent breakouts.

BIIB was up over ten points on a beautiful breakout. Lots of intra day volatility, but a great growing company.

JBLU's break out failed. So set your price alerts over today's high. My gut is that the snow storm had something to do with that. But I asked no questions and sold it the second it started to fail for a small loss. Better to be safe than sorry.

GILD which broke out last week continued to run. One of the great biotechs.

TSLA which popped last week way below its old highs was good for a day trade. Short squeeze city again. They are building a huge battery making facility which will hopefully alleviate their problem of lack of batteries. It would be a shame for the battery supply bottleneck to hold up TSLA's great potential.

HDY broke out of a base on big volume but no news. I do not trust HDY as anything more than a quick illiquid day trading vehicle unless there is some news about them hitting oil and getting the monkey of their law suits off their back. HDY is due to spud probably around late March early April. The great Tullow is the operator of this huge concession with big time potential.

PCLN broke  new high. I may buy it tomorrow. It barely poked through.

FB is now in a nice set up. Set your price alerts.

MDSO is also close to breaking out from a beautiful base. Today was an all time closing high, but not an all time intra day high.

MHR broke out to a new high. It is a slow mover.

RDN continued to slowly run and AMZN made another new high. Maybe its time for everyone to realize that AMZN is being valued the same way that the original cable TV companies like TelePrompter were valued during their first decade of life as they made no profits while building their infrastructure.

Lastly, IBM had bad revenues again after the close. Earnings were not so bad, but that was due to all kinds of games like share buybacks, lower tax rates and so on. This battleground stock is one tough short. I scalped a few shorts after the news and guidance were out, but it was hard to borrow. Any way, on the one hand there are well known declining hardware sales. On the other hand, IBM has cash and the ability to remake itself - something they have done before, but something that is becoming more and more difficult as technology passes them by. Then there is Warren Buffett and a strong institutional following. Again, this is one tough short. My general inclination is to hit and run if I get the chance tomorrow, but mostly stay away from IBM. Lets see what if any shorting opportunities we get tomorrow. The bears have the ball. Not a pretty chart. Can IBM break support?

BIG Capital Advisors and Seaview Partners are not responsible for your investment decisions. We believe very strongly in our opinions, but you must perform your own due diligence in making your investment decisions.

What Can Silvio And A-Rod Tell Us About This Tape?

Just when I thought I was out, they pull me back in:

http://www.youtube.com/watch?v=U2nmdde7uiU

This market is off to a ragged start for 2014. The more this new year goes on, the less I want to hold overnight positions.  This market is moving by fits and starts and going nowhere. Last week it looked like we were finally getting out of the woods, but the market hit the wall by week's end. Silvio is right so far.

Momentum leaders like CSIQ, YY, GOOG, AOL, JAZZ, YELP exist, but they are the exception and are mostly extended. I would still wait for a dip to buy as long as the market is not correcting. If the market gets whacked I would wait for the market to stabilize and see how these stocks are holding up. So assuming no bear market or bad sell off here are my thoughts:

 

CSIQ The best of the solar stocks is a bit extended. I would buy on a quick dip.

GOOG No one doubts that GOOG is a great company and that Larry Page is brilliant. They have their hands on every new innovative technology to speak of. Glasses, cars, homes, robotics, etc. Turning these new ideas into money will be an issue. Unlike once great companies that eventually stagnated or died for failure to innovate, GOOG is trying hard to avoid falling into that trap. I think GOOG is extended here.

JAZZ is on fire but extended.

YELP is still on the edge of the buying zone. A small pull back would be helpful.

YY Similar to CSIQ. Buy on a dip.

Former momentum leaders like NFLX & SBUX have fallen by the wayside - at least for now due to institutions locking in capital gains in the new year.

NFLX Its always the same story for NFLX. Can they maintain their lead in online streaming video in the face of competition from AMZN, HULU, some Cable Companies,and possibly AAPL & GOOG? Earnings and guidance are coming out soon and we will get a better idea about what's ahead.

SBUX is probably in the buying zone. I would like to see it build a base and pop to the upside.

Chart setups are always there, but right now the number of setups that actually set off price alerts is rare. If I had to boil it all down to one indicator, the number of set ups that actually work out is probably my best stock market indicator. When my price alerts are constantly going off, that means that the tape is good and there is plenty of opportunity.

Every night I do my homework. I run my chart screens using good old fashioned Metastock. I look for chart patterns that have succeeded for me in the past. That usually means strong relative strength stocks that are in secondary or third bases with defined breakout points. There is usually a story or great earnings growth that goes along with the stock. Furthermore, as a general rule, the more bases a stock has popped from along the way, the less the odds of further success are. Set your price alerts at the highs for all these stocks.

BIIB is a great company, in a great group with other similar stocks like GILD already at new highs

PCLN Great low priced stock - you heard me - with fabulous long term growth, trying to hash out a base.

WX Nice little consolidation for this momentum favorite.

Peter Lynch can show you that many great stocks move for long periods of time - even decades. And he's right. But Peter Lynch was able to live with 30% draw downs in his Magellan Fund portfolio and stick with great stocks for years as they went side ways within their long runs. I do not have his temperament or desire to be a bag holder during bear markets or corrections.

Recent breakouts are not that exciting in terms of momentum:

AOL The dinosaur has turned it around. I would buy on dips. But remember that AOL has already made a big move for several years.

GILD Great biotech stock that recently broke out. A long term champ.

RDN Great turnaround story that recently broke out. I wish it had more momentum.

Are we may be in an Alex Rodriguez economy that is starting to break down after too many QE steroids. Like many athletes on steroids is this market at the twilight of its waning powers? Or, if you will, are new drug free athletes going to take over and do the heavy lifting?  PIMCO's Mohamed El-Erian says that the world in 2014 is better, but not good enough: http://www.cnbc.com/id/101347884

In short, earnings Season may be of help, but the year over year comps are getting more and more difficult to meet for old market leaders. And we still face the question of whether the economy can make it on it's own without QE. Is the economic growth decelerating as the Fed weans it off of QE? Recent evidence is of concern but mixed.

My gut is that we are probably in some sort of indecisive transitional phase that will last until we get some clarity about the economy, the Fed and earnings.  This leads me to the conclusion that I must play small or not at all until I see my pitch. And I have to see many more good pitches before I believe in this market. Maybe earnings season will do the trick. Next week some 60 or so companies are reporting. If one is nimble enough, it may be a good time to consider to go long or short or both depending upon the earnings and guidance of individual stocks. 

PS: As a sign of the times, I notice the advent of trading groups like those run by Sykes, Michaud and "Superman" - who's specialty is to promote himself in the social media as a latter day "Wolf of Wall Street," replete with pictures of women, fast cars, yachts, and champagne. Is this guy joking?

In my opinion, they suck many novices in with stories of great success using their methods. I'm sure that guys like Michaud are good day traders. But I am just as certain that he has a racket going. Scalping myopic trades for profits as a day trader is a difficult game that most people fail at. I think that these so called trading groups are milking most of there so called students for huge monthly fees while using them to buy or short the stocks that the pool leaders pick. Thus, creating a self fulfilling prophecy. If one buys or shorts a thinly traded stock and has an entire trading pool behind them, they have literally cornered the market for enough time to scalp a nice gain. Plus they have an on going income stream form subscribers who are looking for an answer. I'll bet that 90% of the subscribers are chasing their tails. some things never change.



BIG Capital Advisors and Seaview Partners arde not responsible for your investment decisions. We believe very strongly in our opinions, but you must perform your own due diligence in making your investment decisions.

Down Day, But Action Under The Surface

Another day at roller coaster amusement park. This time the roller coaster went down, but there were
plenty of big upside movers that ignored the general market. I must say that in general, I have had my best days during the period after the first day or two rally by the major indexes. I think that in a decent market, that is when the institutions are done pushing the major indexes for the time being and the market broadens out. Not that I'm so sure that this is a dent market, mind you.

SRPT was one of the big upside movers that I bought pre market. A tweeted about it at 8AM and jumped on it right after when it took out its AM highs. I'm still holding it, believing that it can run up another 6 points or so before it hits resistance at the gap down point and 200 day moving average. SRPT got FDA advisory panel report. That is not the same as FDA approval which usually - but not always - follows. Anyway, this is a stock that was busted that may become whole again.

GILD is a biotech superstar which finally broke out of the base I had highlighted in an earlier post. Great company. A keeper.

CANN went ballistic again, but without me. Who would chase a thinly traded parabolic fad company that gaps up on no volume? They rented a head shop and own some land to grow pot on in Colorado. They have no earnings or revenues to speak of. Yet CANN is trading like it is the new born HD of pot.

ASPS went up again and I will sell it tomorrow.

RESI lost a tad on it today when they announced a secondary. Out. I also did not buy NQ back sine my price alert was not met. And I sold KNDI & because I am keeping tight stops.

Other stocks like AOL, TSLA & SCTY made big moves. Here is AOL. AOL probably has another bit to run, but I should have bought it on the breakout. I did not have my price alert set and paid for it by missing the trade. One of the keys to making money is doing my stock scans each night and setting my price alerts at break out points. Homework is key. Many stock setups that I post will not make it. But nothing ventured, nothing lost. I live for the ones that do alert me.

.

BIG Capital Advisors and Seaview Partners are not responsible for your investment decisions. We believe very strongly in our opinions, but you must perform your own due diligence in making your investment decisions.

Going With The Flow As I Scratch My Head

Who am I to fight the tape? I can make every intellectual argument in the world, but the tape is always right. With that in mind, I let my price alerts and special situations take me into long positions. Those positions are either day trades or short term swing trades. I'm still playing small and fast.

ASTC  I noted ASTC earlier and tweeted about it. Beautiful breakout.

CANN  This one is very dangerous and is strictly for day traders. The stock is thin and the company makes literally no money. But it is running on pot legalization mania. Cannabis Emptor! Strictly day trade small positions and off the day tic chart if the opportunity arises.

GTI  broke out and failed three days ago. But I stuck with it resetting my price alert.

KNDI is the new China auto rental vending machine company that has taken the momentum players by storm. It has to start to make some money, but their first huge auto vending machine is operational.

NQ shook me for a loss after it popped the cup handle on good news, only to fall back down. Ouch! Nevertheless, I have my price alert above today's high and may buy it back.

 

RDN keeps on inching up after breaking out

RESI I've followed this AAMC spin off for days and tweeted about it when it started to pop.

URI Nice little continuation pop.

BIG Capital Advisors and Seaview Partners are not responsible for your investment decisions. We believe very strongly in our opinions, but you must perform your own due diligence in making your investment decisions.

It's Yogi Time - Deja Vu All Over Again

Is this more of 2013 all over again? Every sell off last year was always met with fast "V" shaped reversals right back up which turned into rallies. This time the market bounced, but the jury is still out. Leadership is all over the place, but is mostly lacking. All of the concerns I listed in my last post still exist.

It's also Maytag time. Like some college kid jumping into an over sized dryer being shaken up and burned in an effort to set some sort of childlike longevity record? We are all in the dryer. Either way today's strong market was almost the opposite of yesterday's weak market. Almost being the operative word.

There were many signs of strength today and I'm kicking myself for taking the afternoon off to attend to some personal matters. There was plenty of action starting today stating with REGN and TSLA. Here are some selected charts:



REGN popped on good news but still below all time highs. In my opinion, the best way to get bang for the buck with high priced stocks is to day trade or swing trade the in the money options. The key is to find a stock whose options trade in volume with relatively tight spreads.

 

TSLA Took out resistance way below old highs on news of beating sales expectations. Still small numbers, but enough to make the shorts quake. The key will be if Elon musk can produce enough batteries to enable TSLA to really ramp up production.

RDN It looks like the breakout is real. RDN is not a fast volatile mover, but it gets there just the same

CSIQ So much for a wished for pull back. Strong stock.

YELP See CSIQ above

 

ABTL Nice pop.

XYL Nice breakout

There are many other set ups out there and many low priced stocks that are moving fast. The latest game has been the advent of on line trading "rooms" where enough day traders are present to literally corner a stock for short periods of time during the day. Nathan Michaud and Timothy Sykes have this
system down pat. They get a oodles of followers who all pile in and out together making their trades almost a fait accompli..

Lastly, there were some after hours fireworks with Chelsea Therapeutics. We shall see if there is anything to work with after it gaps up in the morning.




BIG Capital Advisors and Seaview Partners are not responsible for your investment decisions. We believe very strongly in our opinions, but you must perform your own due diligence in making your investment decisions.