Archives: 04/2001 3/2001 2/2001 1/2001 12/2000 11/2000 10/2000 9/2000 8/2000 7/2000 6/2000 5/2000 4/2000 3/2000

Will try to show "interesting" stocks from a charting viewpoint in 2001. The type will vary and often won't be stocks to buy immediately. But they are 'interesting' and may show potential.

4/30 Mon 3.2%

This will be the first month to go out positive since Janurary. On the scary side that pattern set up the major down wave that ran into this month. I am still thinking that this consolidation off the strong move is constructive and we will at least get another strong recovery move that will fail and move us back to another bottom. However, I'm now thinking that it has enough power to do it as a higher low--possibly at our current level or just below. The one week pullback/consoldiation actually left me slightly ahead for that period.

There are any number of overhead resistance points that can stop us including that 2250 area consolidation as the worst case scenario. But, I think we'll at least get to the 2500 area I think we get to the 2500 to 2750 area and that would complete an A-B-C bear recovery still. Any recovery pullback above current levels would end the bear. But that isn't something to bet on.

My hope is that we do get a good move and that I will reduce back to half cash there. That should position me to be in solid shape to participate in a stronger recovery that would position us above where we ended up this cycle. There are too many variable in all this to really count on anything. So, I'll reduce here an there and maybe set a few real stops instead of using mental ones.

4/28-29 Weekend

OK, the volume wasn't great but the breadth was huge. This is a mending market. I'm not ready to say the bear is dead but he is a cripple. I think the drawdown that comes will build a higher low. That is a change from my previous view.

The bullish move by the FOMC in May will be 25 B.P. They could do more but I don't see them with a crying need. Even in the GNP is revised down, the world is looking better here. There've been a ton of rumors that haven't really knocked things down. Poor earnings or revisons are being seen as the cup half full these days. Barring a piece of really bad news we could do a 50% pullback at some point and then rebound.

I am not saying it is all out of the woods; I am saying that we've done a lot of constructive mending and things are looking better.

4/27 Fri 3.6%

Interesting stocks: SCRI ELY SKX -- all breakouts; it isn't all tech in this rally; good breadth.

Looking to buy: TMBR As a pullback later or with tight stops here.

The techs didn't follow through in the afternoon but other stocks did. I'd been up over 3% earlier. The Nazdaq did hold it 50 day though. Many stochastics have curled over without serious price damage and this makes me hopeful we can build on the V-base complaints with some consolidation that gives us a path to a bull market. This "bear market rally" is starting to feel like something different. I'm not ready to turn bullish here but I'm starting to think that any failure could be a higher low scenario that provides the base that leads us out of this market. On the downside there is resistance layer after resistance layer in stocks and indexes that will make us sweat during the next bull market.

TA wise: all three indexes show the same bullish pattern which are pullback reversals. Bullish pullbacks can run from 1 to 7 days and the three all did the classic 4. They then closed higher than their closing low of the previous day. These offer us the buy the pullback tool that worked so well in the bull market and failed so dramatically in the bear market. What happens here could be a nice plus or a gut-wrench in trying to call a bottom.

Cien is my tell today for the SOX. It was a leader and has done the 4 day pullback Sitting on the support of the gap up with further support and another gap not that far below it. If it can close up today, it could be playable on Monday.

4/26 Thu 1%

Got a note from the folks at Metamarkets that I'd been given their MVP (Most Valuable Poster) award. Metamarkets is a great site that I've recommended often in these pages. I have gotten the habit of keeping their chat session up during the trading day and it is quite an enjoyable group that spends the day there.

Good volume and breadth on the Nasdaq yesterday. It seems to validate a bullish pullback pattern and gives us a nice follow through day in what is looking more and more like a bull market move. I still think we have to retest but that could be weeks away. The Nazdaq is actually trading above it's 50 day average for the first time since the small rally in January that lead to the decline we experienced through March. The concern here has to be the rally wearing out in similar manner.

4/25 Wed 3.1%

B: QQQ 43.90 QQQQ 2.05

Ok, it was a typo but the above isn't. Went in to buy a couple hundred qqq's at the market. So, I looked at this VERY thinly traded stock and actually like it and it's chart. They have an analysis tool for emergency rooms that has gone into Phase I trial. So, I'll keep it on spec. I was buying a full QQQ position when I screwed up and the resulting QQQQ buy isn't going to bankrupt me if it fails. Not a stock you normally want to own. The volume is atrocious. Although it had a huge volume day last week that was almost 1.5 million shares.

Really thought I saw signs of a recovery in Biotech yesterday. Boy, was I wrong. The retest is in process and could get nasty.

4/24 Tue 1.5%

B: HGSI 53.62

Bought some more HGSI here. Feel the pullback in Biotech is about done here at the BTK 504 level. As soon as I bought it there was another drop that took it down another 50-cents. Darn!

Futures are up a little bit and need to be an indicator of the day. Serious weakness here would move me toward the strong retrace camp.

4/23 Mon 2.8%

Well, the futures were limit down. Going to be one of those why didn't I reduce on Friday days...

4/20 Fri 1.3%

Probably a lot of the option plays are out. But it still could be a wild one again. I lagged yesterday with the NazComp running up almost 5%. The question is still the same, does this rally still have legs? Stochastic look ready to roll over. The N100 has had a 35% run up from its lows. If the Composite can penetrate the 2250 area--which doesn't seem a strong resistance point--we could run to 2500. I will probably wait until Monday to get a better idea but my reduce a bit if something goes silly. We're showing signs of getting stretched but the move is more resilient than former attempts. Even if we pull back soon it has been a constructive rally.

Looking at the composite shows the completion of a reverse head and shoulder on Wed. If that is a valid one the possibility of 2500 is stronger and that 2900 area looks like a possibility. The wildest scenario is to hit that 2900 area and then cup to form a second reverse h&s that would then run us up toward that 3900 goal which is far more ambitious than even Abby J.C.

The AMD buy is up 25%. And, it has one of the few stochastic that has yet to peak. If it gets silly, I'll sell of 25%. That'd still leave me at a full position.

4/19 Thu 1.3%

Well that was quite a Wed. Now trying to decide whether to sell down some things or set up some shorts. I think we see 2200 and maybe some change. I can see taking it out and I can see retracing to old or new lows. So things here are approaching their first cusp. A bit of consolidation could be beneficial. The resistance is in the 2250 area and if we can either take it out or consolidate a bit we could have a chance to make the 2900 level in the cycle. There should be some assistance, this time around, from expirations. The stronger view of most earnings here is another positive.

So, what to do? Reduce into the run up seems the obvious answer. The question is when and I'm looking to scale rather than just dump.

I am considering AMD a core holding here. I will reduce but not get out.

4/18 Wed 6.6% Cash 40%

S: PFE 41.05

Don't need PFE after the surprise rate cut. Taking the small profit and moving on.

4/17 Tues 2.6%

Great day up until the last hour and change. The draw down there seems too aggressive. But, we did it all on very weak volume. Some daily charts still look great although the charts are a real mixed bag. Not too happy with the PFE here and want to watch it closely. AMD reports today and would reduce by at least 25-50% on a strong pop tomorrow to try to minimize overall exposure. Still like having cash here.

Cisco missed big last night and the open could be bloody. Can we rally from this? Will be interesting.

4/16 Mon .5%

B: AMD 23.31

The Intel pricing came out and reposition myself for an earning pop play with AMD that reports tomorrow. Seemed to be holding the gap at this point and wanted to play it. Easy mental stop. The buy was a full position and cash is down to 34%.

It is a nice day of consolidation so far. Am remaining optimistic based on this dull action.

Tax day.

Futures are a bit weak early. Hoping for a decent day with decent volume. At that point I'll consider putting some more money to work. Still at 40% cash.

4/13 Good Friday -- Market closed

This will be my "Weekender" message. Next week we have option expirations. How long has it been since we went into expiration with such a positive bias. Thursday was a great last day of the week trading day. Breadth was solid. Volume was more than ok, considering. I will be shocked if Monday is down. I won't be shocked if we get a major move up here. I think it is still playable.

4/12 Thu 3.7%

S: AMD 24.37

Well, I've done every thing wrong with AMD up to this point. We'll see here. Bear-Sterns reports a major price decline by Intel that reduces the $600 chip to $250. If it is correct that should pressure AMD. My ideal scenario is to be back in before they report on the 17th. I am hoping to make a couple of bucks off a trade and it is iffy as all get out.

Today is a psychological day. Holding or a gentle move in either direction would be optimal. We had the O'Neil follow-through day on Tuesday. Lots of stocks with good or improving patterns. If they can have a modest pullback or congestion, we have the chance of seeing more follow-through next week. But, serious damage would lead us toward and early retest next week.

4/11 Wed .8%

End of day writing. Things sold off from the very strong open. Not really a bad day; in fact, I like this better than the setup it was heading for with a massive gain. I under performed the Nazdaq but the Bio Index was down for the day and I beat that.

4/10 Tue 3%

B: PFE 40.45

Bought the PFE on the pullback with a chance to continue the short up trend looking good on the news of their move toward approval on their depression drug--could be big. It filled yesterday's gap up and looked like it was about done with the pullback--being on or just below the short term trend line. I expect it to close back above the trend and will re-evaluate tomorrow if it fails.

Dumb about the AMD as it made a nice little cup off my sell. Oh, well...

Futures are up; day looks bright. Yesterday was about perfect with the more modest volume leading to up but hardly stupid gains. Breadth was excellent. It is just the kind of day I would have hoped for--other than buying a chip stock in the face of analysts doing their point and laugh act.

I am looking at charts that scream buy. And I am a deer in the headlights here. Been here; done that; got the tee-shirt; lost my a__. But, there are all kinds of signs on stocks of all persuasion that say buy me. There are candles that were bearish and the next day bullish. There are stocks that have broken well above good bases. There are all kinds of reason I can come up with to buy here and yet I like looking at 50% cash. Gutless!

4/9 Mon 1.8%

B: AMD 20.05 S: AMD 19.06

Filled out the AMD position on the weakness. This is an earnings play. Feel they will surprise. Though the Dell strength (not AMD a/c) could work against it. A few seconds later it was down to 19.86... Sold the add but kept the core position.

The premarket seems to be ignoring the out at a bottom scenario I mention. Good sign for a decent Monday. Still sitting on a lot of cash (+50%) though with no thought of investing more here. Been here; done that; got burned.

4/7-8 Weekend

Weak Fridays often lead to a weak Monday. But we did see some buying in selected issues into the close. I am looking for a weak Monday with a strong close. The failure of the Fed to do their Friday thing probably caused the afternoon weakness.

4/6 FRI 2.2%

S: CMCSK 41 41 1/16

Late in the day and it was a roller coaster day. No damage at this point. Took the profit on CMCSK at 1:30 while it was still there. Might reposition on a pullback. Should be ok stock with a rate cut--that didn't happen today and should have.

4/5 Thu 6.4%

The market is already open and it is a sea of green. Ain't that novel.

4/4 Wed 1.5%

B: AMD 22.10

Bought an underweight position in AMD; would add down $2.00 and change.

4/03 Tue 5.5%

Yesterday's NAPM numbers gave doubt to an interim reduction by the FOMC and the market sold off in a serious way but stayed above the old low. My personal thought was the China problem was even more important and we will rally when resolved. Another nasty was a downgrade to several high end biotechs by Lehman. We seriously need to recover from this level.

4/02 Mon 7.5%

Could be a definitive day. A break down would put us in jeopardy of 1550 composite. A break up could take us to 3000. Now that is a scary risk/reward that makes me want to leave that extra cash on the sideline.

4/01 Sun

The big new Bush initiative is a Presidential Decree that the stock market can only go up. To further this end he has eliminated the color red, parentheses, and the minus sign.

The Democrats immediately countered that it gives too much money to the rich and the government could not afford this shift in wealth and that all the money that would give the American taxpayers should be, instead, put in pollution control, public works and day care. To meet these goals they propose doing away with the dollar and converting to food stamps as legal tender--which they are in most parts of the country, anyway.