<b>Market View - 07.Apr.2010</b> <b>NYSE Percent of stocks above the 50 Day MA: 88%</b> Yesterday was a solid green day across the board, volume was decent. Money flow has been decently inward the during last three trading days. My short position in the bear ETF <b>DRV</b> was clobbered at -10.77%, I am still holding. Cheers! <i>Note: Make a week-end post about this expereince</i>
<b>Market View - 08.Apr.2010</b> <b>NYSE Percent of stocks above the 50 Day MA: 87%</b> Buy Aggressively Buy Cautiously <b>Hold</b> Sell Cautiously Sell Aggressively (the highlighted option is my current sentiment) Yesterday had good volume, I am seeing money beginning to flow outward. But one cannot title yesterday as a sell off. I will be looking for pull back to get back in. The million dollar question is when do we resume the uptrend. Stay posted......for week-end post... Good Luck!
Be very cautious out there! It is very risk to enter long positions here, sell into the strength if you are still holding. Will have a week-end post.
This week! The daily volume this entire week has been pretty much near average. Money seems to have flowed in the entire week, even on the down day. I have missed this the leg up since <b>16.Mar.2010</b>, which is when I moved to cash. The over all market seems to be slowly creeping up even though the market breadth seems to be same. In other words new & neglected stocks have been making the runs this past week. I still do believe the markets to be over bought here and would wait for a pull back before I go all in. Right now I am: Cash: <b>90%</b> Short: <b>10%</b> , which is almost at <b>-11%</b> .
Why search for great stocks when I can buy ultra ETFâs? by Wishing Wealth I spend so much time trying to find the right growth stock that will outperform the market. Now that we have the extreme ultra (3x) ETFâs it may be preferable to trade them. An ultra ETF is a basket of leveraged stocks or futures that attempts to outperform the relevant index. Since I like to trade tech stocks, I focus on the NASDAQ 100 index, which escaped some of the carnage last year because it contains no financial stocks. I could simply buy the QQQQ ETF when I think the market is in an up-trend. In this way, I do not have to pick individual stocks but am invested in the 100 stocks in the NASDAQ 100 index. Lately, stocks tend to explode or implode when earnings are announced. Because the QQQQ represents 100 stocks, there is less impact from individual earnings announcements. If I want to place a leveraged bet on the QQQQ I can even trade options on that ETF. Enter the Ultra QQQQ ETF, QLD which attempts to double (2X) the bullish performance of the QQQQ. While there is no 3X ETF for the QQQQ, there is a bullish tech 3X tech ETF, TYH. (There are also analogous bearish ETFâs for those betting on a decline in these stocks, which I will not discuss today.) Keep in mind that since these ultra ETFâs are leveraged securities, they can move more quickly in both directionsâup or down. So, if I am betting on an up-trend I could buy any one of these ETFâs to make money as tech stocks go up. The table below compares how one would have done by buying each of these ETFâs during the rally that began after 7/14 through 8/21. I was somewhat astonished by the findings. During this period, the QQQQ increased about 13%. The Ultra 2x ETF, QLD, advanced 27% and the 3x tech ETF, TYH, advanced 42%. I expected these types of results if the ultra ETFâs were performing as intended. QQQQ COMPARISONBut what surprised me was how poorly I might have done if I had tried to do better by buying individual NASDAQ 100 component stocks. About 57% of the NASDAQ 100 stocks rose more than the 13% that the QQQQ ETF did. So I would have had a better than even chance that the stock I bought would do better than the standard ETF. However, only 19% of the NASDAQ 100 stocks beat the 2X ETF, QLD, and only 5% beat the 3X ultra tech ETF, TYH. The odds of one of my stocks beating the ultra ETFâs were quite low! IF I can be right on the trend, and the GMI guides me here, it seems that I can have much better odds of a good gain by buying the ultra ETFâsâand with less impact from earnings surprises. Now, I know that you are thinking that we all could do better by not limiting ourselves to the NASDAQ 100 stocks, but I suspect the odds of success from buying individual stocks would still be lower than buying the ultra ETFsâ¦â¦
<b>Market View - 15.Apr.2010</b> <b>NYSE Percent of stocks above the 50 Day MA: 89%</b> Buy Aggressively Buy Cautiously <b>Hold</b>(do nothing) Sell Cautiously Sell Aggressively (the highlighted option is my current sentiment) Yesterday had solid volume, one of the highest I have seen in a along time. My system tells me, we might have witnessed the largest single day inflow of money this year. How long can this rally sustain???? 90% of the stocks are above their 50DMA I have been kicking myself every single day since <b>19.Mar.2010</b>, for leaving money on the table. <b>Serenity Now! Serenity Now!</b>
Markets are extremely over bought <b>DO NOT</b> take the risk! Have very tight stops set up. I have increased my stake in <b>DRV</b>
<b>16.Apr.2010</b> had the largest Volume I have seen this year so far. This was not just casual profit taking, my personal money flow indicator tells me, we have seen the largest dollar exit since <b>04.Feb.2010</b>. Since I have conserved my capital very well. My game plan for the coming week is to wait for selling exhaustion. There is no need to rush into the markets on big down days, we have to be patient and wait until the sellers are done. My short position <b>DRV</b> has recovered nicely in just one day of bearish move.
<b>Market View - 19.Apr.2010</b> <b>NYSE Percent of stocks above the 50 Day MA: 84%</b> Buy Aggressively Buy Cautiously <b>Hold</b> Sell Cautiously Sell Aggressively (the highlighted option is my current sentiment) Portfolio now I am: Cash: <b>70%</b> Short: <b>30%</b> in <b>DRV</b> , which is almost at <b>7%</b> Good Luck!
Yesterday <b>19.Apr.2010</b> was an interesting day! Even though the markets significantly closed higher the breadth of the market actually had a bearish move. I have been computing <b>30</b> different tests/variables for a subset of stocks every single day which helps me get a clean dissection of the markets that day. One such variable is to compare the dollar value of the stocks that closed green against the dollar value of the ones that closed red. More than <b>90%</b> of the bullish dollar volume was contributed by the stock <b>C</b>, yesterday, which is the reason the markets closed higher. I am still of the belief that the internals are slowly breaking down and we will see a significant pull back.