Archives: 05/2001 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.

5/31 Thu 0.9%

B: AAI 10.80 $=42%

Interesting: AAI broke out on strong volue from a reversee head and shoulders. Currently approacing 11 with a target of 13.

There was nothing to like about yesterday. The only question is how far will the pullback carry us. I am going to buy some of the AAI as a trade today if it is looking solid.

5/30 Wed 2.5%

Bad Breadth, low volume, and good new high/low numbers made yesterday a confusing one. You can logically make either side. A most of stock in the portfolio are now negative on the 5-day report. The GENE runup was the salvation to the overall portfolio. Seriously considered closing out more stocks yesterday but resisted. ONXX again did very well and is the bright light in the portfolio The F buy of yesterday stayed positive but didn't have confirming volume. Cash: 48%.

A stronger pullback than I'd hoped we'd see is more a possibility. We violated the weak support on the Composite. 2090 is the crossover of trend lines that needs to hold to validate the change in trend.

5/29 Tue 1.1%

S: AMD 30.20 QQQ 47.02

Reduced AMD as it continues to trade below the trend line. That was the 29.00 stock that added to the old position that"d been reduced once before. Still riding the QQQ but probably will take my loss today if the market can't turn. As the QQQ continued to weaken I closed the position with a loss. I made a mistake when I added late at about the same level. That was an emotional call rather than using the charts well. Seeing that I has sold so much I felt a need to add something and Ford is paying almost 5% dividend. It is something that could be bottoming and should be a decent longer term holding. It has decent upside volume--all things considered. In a market with a horrid TRIN number, that should mean something. Cash is at 48%.

Well, our Labor Day weather sucked. Hopefully that won't carry over to the market. The market still won't tip its hand at this level. We've got a lot of nearby support including the near exact level of Fridays close and there is nearby resistance. Have to go with whatever breaks. Still see this resolving into an upside move that should be a great place to reduce. Have to feel there will be a test in here somewhere. 2065 is probably the Nazdaq's line in the sand.

Volume after Monday's ramp was puny. So was Monday a blowout top? I don't think so but you have to consider it. My QQQ play on Friday says no. But, I am now a solid holder of the Q's and could get scared out fairly easily. Everybody seems to have an opinion here but I am more wishy-washy than normal. I have come a long way off my lows and I don't want to sacrifice all of it back to the trading gods. But I still have an upside bias.

5/25 Fri 0%

B: QQQ 48.90 49.00

Partial buy on the QQQ; will fill out into close if things look good. That'll give me a position with wiggle room into Tuesday. Well, there darn little wiggle in it but I still bought the close as the day seems constructive to me. The Comp is holding about support and the low volume didn't create silly volatility.

Greenspan speech bullish last eve and is the probable indicator for today. Looking for an up day today and carry through next week. With that in mind the Q's are on the plate for today. And maybe some BBH as I still love the biotech action.

5/24 Thu 2.0%

S: GENE 15.80 14.64

41% Cash at start of day; 50% at end.

Sold all the GENE position out over the day as it built a hump on the chart. Nice ride and much appreciated. Want to own it again and almost kept 100 shares. Still could run but got really weak late and scared me out.

The recovery remains intact. Yesterday would have had me down a couple percent if it wasn't for GENE which managed 42% increase on massive volume. Sold some yesterday and may sell more today. Currently a full position and might go to a half position or even 1/3rd as this gets sorted out.

Today looks to be another weak day as we digest these great moves. This is a good resting point at the middle of the range of my earlier 2900 call as the potential high in the cycle. If this correction does break to well below this area it could be the major return to lows that many still predict. We need to contain and a hold above 2203--which seems unlikely as we go into the day--would be a huge support of the bull market premise.

5/23 Wed .1%

S: GENE 12.91 12.90

Reduced on the GENE by 1/3rd as it is stair-stepping down off its early highs. The big move made me overweight on it. Today one analyst set a $84 target and then another set a $9 target. They both look like idiots with the Prudential one looking like the prototypical party pooper to boot. Just what does a hold with an $9 target mean Mr. Prudential man.

Its about 2:50 and the market is looking good. I like this genteel pullback and a small rally into the close wouldn't surprise me.

5/22 Tue .1%

S: QQQ 50.78

Interesting: NTAP--great day but still not a breakout. INTU--worst stock in the N100 but touching the bottom of its Bollanger and having 10 weeks of consolidation since its fall. It broke a weak up trend to the downside but may be getting poised. The two day selloff was nasty volume though. Watch for climax selling or a reversal on volume.

Could be wrong selling the Q's on the opening weakness but they are a trading vehicle, right? A day or so pullback and taking out resistance again could be beneficial here. I am taking the 2% one-day profit and avoiding piggishness...

Couldn't have designed a much better day. Good Breadth! Good Volume. All the consolidators broke out or continued their breakout. Every stock in the portfolio went out positive.

The market has done an awful lot to heal itself. Breaking through resistance levels that now become support. The pullback that will come at some point is less likely to revist the low. I think this market can begin to really trend; the work to date was a reversal phase that doesn't have the healing power that this next move will add. The SOX was an amazing animal and far stronger than I thought would be possible. Biotech was strong and proved itself almost across the board. Banks did a reversal and closed strong.

Monday was the breakout day I had prayed for last week. It had all the components you need to go long with some confidence. The N100 had only 7 stocks that were down on the day--things like NOVL and WCOM and cable components..

5/21 Mon 6.9%

B: QQQ 49.48 49.46

Well, I couldn't stand all that cash on the sideline as the Naz broke out so strongly. Was expecting a mini pullback at the least and it just won't roll over. Now 25% cash.

Well, here we go with another week with the futures a bit weak. I think we can continue the breakouts that are close on have happened. HGSI got and upgrade and is trading up big in the pre-market. Not much news around and earnings are behind us so there is little impetus to change the trend we have going.

It is a good possibility that we run at 2230 and fail today. That won't be a disaster. We could consolidate here and still be bullish.

5/19-20 Weekender

We've a divergence occurring along the yield curve: the curve is flattening. The yield curve flattens when T-bond yields fall and shorter-dated debt instruments go up in price. This movement anticipates the Fed is done lowering interest rates. That may or may not be bearish at this point. My view is that the Fed saying we are on the mend is as good as a cut. That said I still think 25BP a possibility and happening two more times.

Friday action was a bit negative but in a positive way. The breadth was negative but so was volume--one of those summer Friday's in some respects. Most of my stocks held consolidation levels or continued higher. AMD looked strong and ONXX is finally show signs of mending and starting to move.

5/18 Fri 1.2%

Futures are off very slightly. One stock (BFRE) tanked into the close and reduced profits substantially. Not a worry as that's a long term play. Although, I'm not the bull I was on this stock. It is one of Cramer's picks too so I ride it further at this level of ownership. Thought is to reduce some though but will gut it out for a while.

I think today could be a major positive by being positive in any way and that could include being slightly down. The thing I don't want to see is a serious sell off. Yesterday was so positive that I don't see that happening. Great volume and action on most things I follow. I remain optimistic.

On the very short term, the Naz needs to move some time soon--like next week. Yesterday, we were turned back from taking out the congestion high which is followed in quick order by April high and further congestion. For this rally to succeed we need to see it trade comfortably above 2300. That should happen next week or it is time to begin rethinking things.

5/17 Thur 1.2%

Well who would have expected what we got. It was quite a day. Volume was better but would have been nice if it was better still.. We need a couple more up days and then a breakout above that 2230, 2300 layer to confirm things. My feeling is that if we get that we can head for 2700-2900.

5/16 Wed 3.6%

B: AMD 29.00

Bought back the AMD I sold higher. The devil (and this amazing market) made me do it.

Yesterday was "interesting" as the portfolio ramped the open; sold off; ran up; tanked at the close. I was up about as much as I finally ended down. Not a day for the weak-stomached to watch the movement real-time. Futures suck and this market really wants to sell off. Lot of stochastic have made they run down though and it is really a mixed bag. AMD is one of those stocks that ran down the stochastic and has turned up. Under more normal situations I would add back what I sold off here but these aren't normal times and I will hold on to the cash for now.

5/15 Tue .9%

Conventional wisdom says we tank this P.M. after Allen does his thing. I am sort of ready for it but just have to think that conventional hasn't been the the to this market--there is no key. I think my "visibility" is better 6-months out than 6-hours. Of course that usually the case.

5/14 Mon .3%

It would have been a "green day" without ONXX which sold off on the news it was removed from the Naz Biotech Index.

Futures weak. My flat out guess: we sell off today and into the FOMC. The FOMC disappoints and we have a serious sell off on volume. But, that will make for a very viable rally that takes us up to 2700+. ...hey, it could happen.

And I'm hoping to buy back what I sold off at lower prices on Thurs or so. I think it will take 5-minute charts to work all that. I will try to watch the BTK, BBH (has volume indicator), SOX closer than normal.

AMD is an example of a stock that's already sold off and sits dead on the 38% pullback. I've reduced twice already and am tempted to reduce one more time. It broke the short term parabolic trend at 30 and has now broken the medium term trend at 28.53. 25.97 is the 50% pullback that looks like it will happen. Question is does it make the 62% pullback at 24.23. Looks quite possible and gets close to my basis price of 23.31. A pullback on weak volume would be a bullish move here and set us up for the move I think is still very possible.

The thing to watch for here is W-bottoms. If they happen and hold, we have a great buying position. The hedgies will be getting nervous with all those shorts they'll put on and they'll get nervous at those points. Any recovery there should ramp and that takes us to those mid to upper 2000's. That still my hope and sets us up for a low to mid 3000's late in the year. I am thinking that December will be weak as players try to use any positions that are still loosers to soak up some of the gains they've taken. That's my long-term pie-in-the-sky view. Very subject to change without notice...

My thought is that the 25 BP move that may be all we get is a bullish move. Not in the first blush which will cause a selloff. But the 50BP use up a lot of bullets in the Fed's gunbelt. Rates are getting close to their bottom. A 50BP move with a change in bias would probably have the same results. What the fed needs to do more than lower rates is to expand money supply. They have mucked that up a bunch and need to provide more liquidity. Just my long held opinion.

5/12-13 Weekender

Friday was very low volume--typical of summer trends. The high/low figures remained strong while the advance/decline number was much weaker. Another mixed bag .

I am now 47% cash. Based on Friday weakness I probably should have reduced more. I am expecting a pullback on Monday and Tuesday as the FOMC works its "magic" on the rates. I am now expecting a 25BP move and subsequent disappointment that leads us to a good retrace but not to old lows. I will be looking toward buying the pullback when it shows signs of reversal. I think that will be a valid point but have to acknowledge that it may not be. So I want to stay proactive in reducing if there are any failure signs. Interesting time with a good risk/reward anticipated.

5/11 Fri .9%

S: AMD 28.55 TRW 42.21 CYGN 7.16 17.15 MLNM 35.75

Selling early in the day is usually a mistake. But, I've been concerned about AMD for several days. This was only a 1/3rd reduction. I still like the stock. Just a short term concern. Sold the TRW with mini profit and worries that Tuesday FOMC will disappoint with a 25BP move. I would have held the TRW if the FOMC cloud hadn't been on the horizon. Trying to reduce on MLNM with a 35.75 limit It would be a 1/3rd reduction if it happens. . Partial fill on MLNM so far. Got the rest of the fill. Took a nice 7+% on the CYGN--looks like a possible pullback. Now 47% cash

My tendency going into today is to reduce somewhat and get my cash back up to the 40% area. With the recent buying it is down to 28%.

5/10 Thu .4%

B: TRW 42.00

Well Cramer liked the cycle position and Smith liked the chart. And, I could use more diversity. So, I bought some.

Today is the limit up day on the Naz futures. Weird times. Lots of indecision. We all look at the daily stochastics and believe we are strongly oversold. But, at times it helps to switch things over to a weekly perspective. On the weekly charts many stocks (MLNM) have oversold and even trending stochastic.You switch over to a weekly chart and the stochastic is just coming off oversold! There are exceptions (AMD) that are approaching overbought but not there yet. As a person who tries to play the medium term and up, it is constructive to look at weekly charts. Those can often make you question the logic of the masses and that can be a big trading plus...or not... But the ones that confirm can be the big trade you look for. The MLNM chart sends home the mind duel. If it should fail here it has a negative, daily stochastic divergence and we can think about a serious pullback.

5/9 Wed 1.4%

Futures limit down. AMD looking weak as it took out recent support at the gap up. Lot of doubt out there but also a lot of much nicer looking charts. While I've made good money I've had little in the way of real runaway moves my stock are as trading bound a group here as you can "hope for" in this market. Most are in good positions to resume off the consolidation but time is running closer to the FOMC which adds a specter to the market. Too many are focused on the old pullbacks that we experienced with early Fed reductions and see the possibility of that happening again. If it does I feel it won't be a pullback to new lows and that the market is on the mend. But, I'd really like to see us find a higher level between now and then which would make these consolidations strong support into a decline.

5/8 Tue 1.1%

B: CYGN 6.74

I picked up CYGN on a tout from a fellow in the Metamarket Chat that I hang out in most days. The company has approval on a glucose monitor that keeps track of insulin requirement. It has expendable associated with it that should make for a cash cow. J&J is going to distribute the product and production controls are in place to get the product out in the market.

The bullish side of me calls yesterday constructive while the bear is singing "Seems like old times" as the market had an early rally eaten up by a selloff into the close. But the markets are back in rally mode with the futures up strongly. The market is overbought and needs to rest. There's the look of a reverse head and shoulder in many stock and indexes. I've long said we have a chance at as high as 2900 in the cycle. My guess is 2500 and my longer shot hope is 2700. To do that stocks need to trend and it has been a long time since that was happening. We'll see!

Wanted to buy something early yesterday and would have been wrong. Wanted to by SEBL late in the day but I suspect it will correct further. Maintained the discipline.

I don't expect much out of today--even with the nice futures. CSCO reports after the bell tonight and I think eyes will be directed toward that and with the market action looking ahead. So I'll try to avoid today with the thought it is likely a headfake.

5/7 Mon 1.3%

Boy, what I wouldn't give for a crystal ball right here. It is really crunch time or it is approaching. Insignificant futures action at the moment. I go into the day thinking I should be a bit lighter. I think a lot of the first wave effect is in the picture. Although, this tape just won't say uncle in even a minor way. Friday was a major bear trap in an overbought market that had every reason to pullback. That makes me think we can have 2-3 really nice days still. That could lead to a scenario where that 2250-2300 level can turn into support.

The 50 day is actually point upward. The last time this happened was in September 2000--the kickoff point for the massive decline. So, it isn't yet the time to get cocky and that is what makes me think I should lighten up some. I am 40% cash and still think I should lighten up. Question is will I and will I be right in whatever I end up doing. This is not a time for confidence--regardless of the side of the tape one likes.

The problem is there are only a few months in the average year where you can make a lot of money. The rest of the time it is grind that can just preserves capital or make you a couple of percent at best. So you want to be invested when those times come. Right now the risk:reward sucks when it comes to adding to anything. 2000 is major support and if it crumples the bears will own the playing field. 2300 resistance has great potential for moving us higher and making todays price support. For all that is said about the parabolic nature of this move we actually have a nice 13 day consolidation in the composite. Running that up from our overbought stochastic makes a great case for a bull market return. Right now the bulls are in the place we were in September 2000 where it looked like a low and was the worst bull trap in the market that I've followed. It feels like the bears have that feel in this market. They are sure things will tank as we were sure they'd recover back then. Only one side will be right.

I note that my posts of late have been larger and larger. Last month they got pretty thin; I just didn't have any thoughts that seemed worth expressing. Things seem different somehow. And, I have more optimism. False? you got me...

5/5-6 Weekend

Friday was an unbelievable day. This market just won't roll over. Many will talk of the excesses that are returning to this market. I don't see excess in the optimism. There is breadth in the market. A lot of stocks are participating. Certainly stocks will overextend; correct and do all those other things that keep us on our toes.

A lot of people were severely damaged in the last year and a half. My draw down was far more than is tolerable. But, I'm still in the game and that is the key. So much of our gains come in spurts of "irrational exuberance" that can make our year. There has always been excess in the market--excess in both directions. Bear cycles are dramatic and short lived. So, I am willing to call the bear dead; I realize that I am usually early in calling something. I was early on the bear market and then thought I'd missed the call and was wrong when it happened. But if I had been out of the market I'd have missed almost doubling my portfolio in the first months of 2000. Now I gave all that back in being too invested in much of the last year.

Money management has become a more significant part of my planning. I'm not saying I want a conservative portfolio; even if I should be more thoughtful in that regard. It isn't my style. So, I limit exposure with larger cash positions than I would have ever maintained in the past. Part of the trick is to be there when the big moves come. If yesterday was 6 months ago I'd have put every cent to work. Instead, I took one position after selling a greater amount the day before.

What is missing in my portfolio is smashing the averages. I trail too often and that is on days like yesterday when my Biotech holding should have smashed the market index and hopefully the Biotech one. Well, Biotech beat me 2:1. But, IDPH was the gorilla in that space and I didn't own it. Can't blame myself for that but want to keep an eye of what I'm in and may get a bit more diversity. Something I need to think about.

Fri 5/4 2.2%

B: MLNM 34.40 34.22

Was so underweight I had to get a decent position in MLNM back. Should have held it yesterday. Made a bit though. They started 27 trials in conjunction with Cancer Institute.

AMD really recovered well yesterday and seems so strong--even in that decline. I am still thinking Friday will be a weak day but the futures disagree. It'd be impressive to have a Friday rebound. I am 47% cash with the rest in 7 main position.

Update: Job report sucked and the futures are now limit down.

Thu 5/3 2%

S: QQQ 47.51 HGSI 61.07 MLNM 35.25 AMD 31.57

Should have sold the Q yesterday when I was thinking about it. Thinking is not as good as doing. A $300 mistake. Took the profit on the recent by on HGSI and reduced MLNM with the thought to rebuy that one as it is now underweight. AMD was getting overweight and still is a bit so. The scenario I'm somewhat playing is a pullback that ends Monday.

Good volume in the Nazdaq and signs of failure looming in the overbought listed stocks. None of this is a dire view. We need to correct and have to question when, what, and degree. I still think the Nazdaq can continue here. It could bring us back to about a 50% recovery or so. I've said this with tongue-in-cheek for some time and still recognize the possibility. But a pullback to our last gap up could be constructive. Pulling back into the 2000 gap would be a lot less helpful but still allow the bullishness to sort of continue. Making further gains here is the best case and our channel (50/2) get us to the next resistance. If we can do that then the pullback has this level as support.

The bearish scenario makes this a simple A-B-C recovery against the continuing bear market. From that level we correct and take out the old low. The time of year we are approaching lends credence to such a move. The index puts are voting that way but they are a contrary indicator. Breadth also makes you think the recovery is real. I am more bullish than I was in mid-April but not ready to bet the farm on either side. And, think raising cash back to where it was going into this rally is my best move. I want to stay long but not too long.

If the doldrums don't lead us along the bear path and we can just remain around these levels in a trading range through the summer, then, my hope is for 3700 by year's end.

Wed 5/2 .7%

S:ONXX 11.20

Reduced a bit of ONXX into the strength. It was becoming an overweight position. Trying to do the same with AMD for the same reason.

I said in Metamarkets' chat room Tuesday that if I'd drawn a 100 daily charts to guess what the day might look like I wouldn't have come close to the actual. Things are weird! We are getting a week of direction in a day.

Tue 5/1 1.6%

Yesterday's 3.2% gain was disappointing in some respects--representing a pretty strong afternoon pullback that wasn't well attacked into the close. We could use a consolidating move. Yet you have to respect the breadth. 79 of the Naz100 were up. But we are overbought in so many places that moving higher in substance means we need to absorb this move with an extension to the pullback or consolidation. I don't think we get it quite yet though as the resilience seems to be their to ignore overbought indicators--just like the bear market could ignore oversold.

The Dow and S&P are looking ready to pull back. I think the Comp might counter trend off a stochastic pullback that appears complete. Every stock I hold is green on a weekly basis. So, we could pullback and we haven't broken the downtrend. This is not a time to add but my long term view will keep me in stocks even if/while I reduce. The pre-market is edgeless.