Taking a stab and rational thought

Atheros is a great example of a stock with a lot going for it, both as a company and as a stock. It has shown super RS vs the rest of the market, esp the last few days when everything else got hit so hard. The company is also growing its earnings at a very robust rate, not only earnings but REVENUES as well, which I think are just as important. My only concern is that at this point its a bit strethced, it has nothing underneath it, so I would look @ this one as a strong, but pretty risky stock. The same goes for AAPL, even RIMM, AMZN etc. That said you should definatly have them on a list, coz when they do rest and break again I think they are names you'd want to establish new positions in..I just don't think that now is the time to put on your first trade in them. If you are already in from earlier and have been riding them for awhile and have a few dollars of mad money...maybe...but otherwise I'd unfortunatly have to pass on this, even though it is showing great RS and growth etc etc.

Brandon

 

Brandon, I have neither the time nor the inclination to monitor the posts of every person agreeing with my point of view. I am always glad however to respond to any comment you may have about MY posts.

Thanks
Steve

 

You will have to forgive me Steve, my brother has always said the smartest part of me was my well kicked (by him) ass. Anyway, cliptrader, trader28,allaces, fubar etc came on telling us all how much he loved you. Frankly I don't know either one of you, so I don't really care...but what I do care about is not having this thread turn into a typical ET shit throwing contest. I have been away from here primarily for that reason and am hoping to find that things can change.

As far as a market type response to your posts, I see none to make. All you have done is come on here and bitch. If you have nothing to offer, please give me the courtesy I gave you by having trader28 etc removed and stop posting here. If you have something worthwhile to post, have at it. The only recent posts of yours I can really find is your ongoing fight on the wives/wealth thread. I very much agree with your point of view there, but I have no idea what you think about the market.

 

Ok, so I took some time to find some of your trading related posts (on the ES thread) and I don't find anything we disagree on, in fact I suspect if you sit back and just read how the thread develops you'll find yourself agreeing with me every now and again.

Much to late now for me to be up doing this. G'nite.

Brandon

 

what steve is trying to point out is that anyone who tries to predict the market isn't as good a trader as those who trade in the now

I hate sounding like hershey

but you want to trade short term and in the NOW

I hope that helps

the funniest thing is, I discovered that the hard way only to see some guy post it on some self proclaiming web page

 

Well, I think if you read the post that started this thread, or go back and read my trading realted contributions to ET, you'd find that we have nothing at all to disagree about there.

 

Ten years or so ago Shania Twain came out with a hit song “That Don’t Impress Me Much”. I can still see my sister when she was 11 or 12 years old prancing around and singing it like it was her theme song. Every time I hear that song on the radio it cracks me up and I start laughing like I was infected with the stupid virus. What the heck does that have to do with the markets you ask? Nothing, it’s like Tony Soprano’s mother once noted “It’s all a big nothing!” Well, maybe not, I must say that this markets action the last few days certainly has not impressed me too much. What have we seen? Well, pretty much the exact opposite of what I’d like to be seeing: We’ve been selling off on heavy volume and rallying on light volume. This is never a good sign. Some signs of strength should be noted though, that the 50 day moving averages have held (in many cases to the penny) across the board, that leading stocks have not yet broken down etc and people got bearish really quickly as soon as we had a little tiny bit of selling. This to me was just amazing as I trolled the message boards and chat rooms, the bears all came out of hiding very quickly to note how smart they are and how stupid anyone who is bullish is. Typically when they come out that quickly its not for a long lasting party, unfortunately.


So what did happen Friday? Well not much until about 1:30. I was about ready to give up and go watch Soaps or Judge Judy- the market certainly was not providing too much by way of entertainment. Then the rumor of a US Steel (X) buyout appeared and low and behold the market was goosed and off to the (very low volume) races. Where do people come up with these stupid buy our rumors anyway, seriously. If all I did was chase my tail trying to anticipate the next buyout I’d probably have better cardiovascular fitness, but that’s about it. I’m pretty sure one thing I would not have is money. Another notable stock in the market was National Semi (NSM). Things continue to go downhill for them, but the market did not seem to care on Friday as the stock was one of the leaders on up volume for the day, and not only did the stock itself move higher, it provided a certain catalyst for the entire sector, so the Semi’s stood out as a clear leadership group on Friday

So, the big question is what to do? I mean all this time rambling about Shania does not exactly accomplish too much does it? Well, I’m still of a mind to be patient. I know a lot of traders who feel the need to jump on every move, guys who seem to be physically pained if they miss a move. For the most part all of them end up being “former traders” rather than “current traders”, but they always seem to form a large part of the Internet crowd, and for sure they have been out the last few days ready to pounce, I mean it would be a shame to miss that first one or two percentage points, if you don’t get that you might as well go back to Wendy’s!

I have always been of the opinion that it pays to pay attention to relative strength. I’ve always wanted to be sure I know which stocks are behaving better than the overall market (which is why I love pullbacks in up markets, because how else are you going to isolate strength but by exposing it to potential weakness) or worse than the overall market. Right now a number of stocks are showing favorable traits, and held up very well when the market did not. Names such as PVH, RIMM, MCD, GES, CPLA, APD, MGRC, SIVB, MTN, SAY, SSYS and GRMN for example all have my interest. Not all of them are buyable at this point, many of them still need to build new bases, but some such as SIVB, MTN, MGRC etc have potential at this point should they break the bases they are currently in. On the short side there are a lot of things out there that interest me as well. With the bond market in its own private bear market here (and it is in a bear market) a lot of sectors are getting hit hard, and should continue to get hit hard. Utilities are always interest rate sensitive since they tend to borrow heavily. Names such as DUK, EXC, SO, and XEL are showing a lot of weakness and will probably offer more shorting opportunities. At this point I’d like to see each of them either trade sideways a little or rally slightly, but the utility sector is in a bear market at this point and worth watching for short side trades. I also see a lot of retail names breaking down, this is a bigger theme I’m going to be keeping a close eye on as well, but for right now moves lower in SMRT and BEBE defiantly look shortable to my eye. Finally the homebuilders, poor, poor homebuilders. They did manage to rally back a little bit on Friday, but it was again “not impressing me much” and this is a group that will likely continue to have a hard road. Names like DHI, PHM and TOL for example seem weaker than the rest and are probably worth keeping a sharp eye on. Finally there are a few stocks just out there all by themselves showing weakness, names such as BRCM, NCC, LPX (although LPX being a wood stock could fit into the whole higher rate thing).

At anyrate, that’s what I got for today. Hope it helps someone. If it does send me a Giordano’s Pizza! (you can order them off their website, I have no objection to giving you my address if ya want to get me one J ). If its not helpful, well, you can always send me a Giordano’s and hope it gets food poisoning on its way to my house!

 

As I had expected there is not a lot going on for me today. I've got a small long position in SIVB and MTN. My short positions in the QQQQ, BEBE and DHI are larger. Thats all I have open at this point, and I'm still 65% in cash overall. Just not a lot to be excited about in this market.

 

There is not much at this point to add to what I have been saying for the last few days. I remain cautiously bearish, at least for the short term. The major indexes did all bounce off of 50 day moving averages, but this bounce has been a weak one and on low volume. Things are already looking as though they are turning over. Specific stocks that I like in here include DHI, BEBE, MA, HD, SO, ED, NSC, AMD, BRCM and PCG. All are shorts. Although my stance right now is short term bearish, my intermediate to longer terms views have not changed (bullish) and as such I will not be putting on large positions in anything. My dominate position will remain in cash, with maybe 30 to 50% of my equity invested into the above ideas provided that they trigger.

Brandon

 

Before I forget, or you decide to do something more useful with your time than post on ET, I have to say:

That is one absolutely brilliant post.
(there we go, nice and clean too)

Good trading,

Jimmy Jam