Everything was on an improving trend in the markets until 3 PM..when NASDAQ was barely down......then came the hedgies and trashed the markets on extremely "thin Volume"
Down volume was way higher than UP volume......a decidedly negative tape by close....
Markets will have thin volume again next week.....as vacation continues on wall street.....
So....we will NOT get an accurate feel for the markets until following week of Jan 11th......
In the meantime take a very "critical look @ your portfolio and make some strong bets on stocks which will move quickly"
I am going to continue booking profits as "hedgies will be playing with this market for another 3 days.......
I may trade even MORE than before.......
Why.....Because I am suspecting that markets will remain volatile & range bound......for the first half of 2008......
So sell.... when hedgies are covering their shorts and buy ....when hedgies are shorting the markets......
Can this be done successfully......Yes I firmly believe so $$$$$
So...you have a CHOICE......watch the YOYO markets and HOLD your positions as long-term strategy...or you can JUICE UP your GAIN by trading against the forces........
I do realize that some of you like Steve are NOT by your PC whole day...so it is hard to trade like some of US.....who have nothing better to do than trade whole day.......
But .....those who are tied UP can place GTC ( good till cancel order to buy or sell @ pre-determined price with 1 or 2 weeks time frame)........
I am actually preparing myself for more daily SWINGS than 2007........
I started implementing my NEW & IMPROVED strategy already.... by selling AAPL yesterday.....and buying bargain priced stocks.......
So...knowing your stocks trading range is extremely critical to trade with profit......
My current portfolio is :
BIDU,CSIQ,LDK,MA & LDK......
My $ allocation is :
CSIQ....... 3.5%
MA ........13.5%
LDK.......17.7%
RIMM.....28.6%
BIDU......36.7%
Yesterday my portfolio was down .8% only...thanks to my Canadian $ short which tumbled 1.64 cents yesterday...so my whole portfolio value got a much needed boost of +.6%......
All of a sudden Barron is bearish on Canadian $...calling it overvalued by 30%..so other Barron followers will jump on this short the C$ bandwagon NOW.....
As you all know I have been short Canadian $ since 830AM Nov 7 @ $1.0980..yesterday it closed @ 100.25 cents...so I have an ongoing GAIN of 9.55% on my entire portfolio value...which means in English a gain of 85.6% in equity since Nov 7 2007.........a horrendous % gain if you annualized it !!!
My whole portfolio is in US$...as I am extremely bullish on US$ for next 5 years !!!!so each time US$ moves UP against Canadian $...my portfolio value goes UP on top of any stock appreciation.
So...I am looking @ 2008 first six months with an accelerated trading mode...because I believe that If I do not do this .....I will see my portfolio struggle with daily gyrations......
Stocks 12 month target has NO meaning if we are not closing higher & higher......
So....trade the daily range is what I am looking @.....with great discipline !!!
Every time I want to relax a bit...market starts surprising me ...which I do NOT like.....so REVERT to NEW strategy......
Whether you play Momentum or bargain stocks......it is important to trade out with profit....
I am NOT very hopeful for first SIX months of 2008......
Why...same sub-prime mess which will NOT get cleaned UP until July of 2008......
So .....embrace the volatility & try to lock some profit !!!!
Not a bad "mantra for next 180 days"......
I would love to change my mind when market tells me to do.......
I simply follow tape........
Tape NEVER LIES !!!!!
If...it is possible try NOT to follow CNBC...in my humble opinion...they do NOT give you the-best ideas.....they get you IN @ TOP & leave you HUNG until you crash & burn....I am putting it CRUDELY to make a point......
So...2008 is here.....
Plan to make serious money.....
One trade @ a time !!!!
Thank you all so much.... for leaving greetings for a prosperous new year....
This BLOG comment section is very useful for interaction about any stock.....I read them with great interest.....in any language even in French.......
Merci !!!!
Saleem
PS...If you have any comment or question about my take of markets/trading or stocks..please do write...sometimes a clarification may be in order !!!!
27 comments:
SALEEM:
have a happy day and your family also.
Please tell me what a hedgie is?
thanks again for the Blog and the chance to interact with you.
Madmax
Hi Madmax,
This is a term used for Hedge funds.....
Hedge funds bets on intraday swings.....
These funds are all over US & Canada......
So... they may short the whole market and cover by close...or repeat the whole trade many times in a day....
Also they may short AAPL & go long RIMM...
Short FSLR & go long on LDK....
They are very active daily with mini S&P,QID,QLD or whatever works for 10 minutes.....
Hope that explains !!!!
Saleem
Hi Saleem,
Just a quick note. I noticed that short interest is at its highest level in 5 years last week.
The market is close to the trend line. I am hopeful the that shorts will start covering soon.
My positions are a little bit red and any covering will quickly make them all green. nvda,chl,hbd,cmed
I remember the solar stock's in the 70's,,,with gas rationing,,the stocks went sky high and as people got used to the higher prices the stocks tanked to nothingness.
Best of luck in this new year!
Standards
Hi Standard,
You are nicely diversified.
I generally do NOT worry about markets.....
I worry a whole lot more for the stocks I own......
Tape monitoring is what gives me optimism for a profitable trade.
Some of those short position does not give much of an indication...as it is a delayed report.....a lot CAN happen on a daily basis.
Saleem
hai saleem,
I own AAPL, FCX, PCP right now. what is your opinion on FCX, PCP (based on TA). I sold AGU, JASO booked 15% profits on both of those. Thanks for the latest blog
Thanks
Ram
Hi Ram,
Great trade on AGU & JASO...
FCX has crossed below 50DMA.....
www.stockcharts.com is showing as trending down to $76.....not that they are always right....but they spot trendline...
PCP chart is looking better and may rally....again www.stockcharts.com are showing it going higher to $200....
Although PCP is below 50DMA..but...it is trying to find support around these level....
So...I say yes to PCP & ? on FCX !!!
Saleem
Saleem, Can you explain or share the technique of tape watching, so everyone over here can also try to learn it..!!
TIA
Saleem,
Looks like you're going to be a busy man during Q1 and Q2 2008!What happened in the last week or two that made you decide to change your investing strategy? I personally have not heard/read anything new, as the prognosis by the majority of the "experts" has and continues to be for a very volatile first half of 2008. In other words its more of a stock picker market vs. buy anything and it will go up market.
I guess there are two ways to play this type of market. First is to follow your methodology, trading like a pseudo-hedge fund, or secondly find stocks that are strong and can "weather the storm."
I think a person's chosen method depends on what they feel comfortable with. As for me I will be following a hybrid method using both methods described. I will be holding my AAPL (42% of my porfolio) for the foreseeable future. My main reasons for holding AAPL fundemental: (a) cash position - $15B+ and; (2) their continuing output of new products scheduled for 2008, which will translate to continued sales and earnings growth. I expect AAPL to be in the $250-$280 range by the end of the year, which is a 25% - 40% increase on what may end up being 50% of my portfolio. In these tumultuous times I would be very very happy with that. As to the other 50% of my portfolio, those stocks may be traded based on the tape. It would be a dream come true if the other stocks I currently own (LDK, MELI, JEC and FSLR) have similar increases to AAPL's projected share appreciation, but....we'll see.
Bottom, line I ended up 33.42% in 2007, if I achieve 40%+ this year, I would be thrilled!
2008 is here, so let's get it on!
Bruce
Hi Saleem. The end of the year throws three unusual circumstances "which can mask the underlying trend" of the market. One is thin volume, 2nd is tax selling and third is re-shuffling of mutual funds. Once the new year gets underway, the real trend will be seen. I think solar, emerging markets (India, Russia), big cap tech(apple, bidu, etc.) and energy continue their bull runs.
Hey Saleem,
Been reading your response to Ramdharma about FCX. I have been using Stockcharts since you told me about it. I was wondering, where do you see that 76$. I see the trend but that's it... Do you have a StockCharts Membership that gives you more indicators or am I blind?!? Thanks. (Been doing Reaseach and TA since morning...) Maybe I will dare posting my picks later.. for what it's worth....
Hi Frogvest,
www.stockcharts.com is the most useful tool I have discovered and use it extensively......
There is so many nice tools that is free.....I am amazed that they give it away unlimited use.....
If you go in Gallery view and put any ticker ...you will get P&F short term/Long term CMF & their view of bullish or bearish plus....are you ready...their target price.....
That is "mother of all format for me...all in 10 second"
www.stockconsultant.com is for daytrading or next day trade but they are superb for Breakout or breakdown in chart.....but they restrict only 7 free ratings/targets....
Saleem
Hi Bruce,
You have a very successful strategy...so do not change a thing.
I agree with APPL 100%...but I like "optimizing my $$/capital"
I felt that almost $22 per share profit in 4 weeks should be taken and the entire capital can employed better by adding 50% BIDU and doubling LDK plus CSIQ......
I feel I can do 100% better in short term and then get back in AAPL whenever I want again.
See...this is the strategy of pulling money OUT every month and optimizing what I have..gave me the "mother of all return"
I keep my exposure /$ allocation to a given number.....once I exceed ...I sell something ...take money out & back in business.....
I hope I am making sense to you with my optimizing concept.....
What changed me in two weeks....
First I was too contended with my return so was trying to be an investor......
Then I realized that these hedgies will rob me of all my contra creativity and will make very little money.....
So the Bull (Taurus) woke UP & am back with the same venegence as 2007.....
Only time will tell...whether optimization worked or NOT !!!
Saleem
Saleem,
Wow... Just looked at Gallery view. You are right, quite amazing free tools. By the way, I ordered the book you mentionned the other day (One Up On Wall Street) as well as The Intelligent Investor (heard great things about that one) and a TA book.
Thanks a lot for your time... I hope you won't get the idea of turning your blog into a pay site... lol
Hi Minaccess,
You reasons are all valid.....
But....I must stay the course...
Hedgies/mm/institutions are all trading in 30 minutes time span...
Since there is no resolution of Sub-prime mess yet...so they will turn this market upside down @ whim.....
I am very good in reading tape and going against the grain/popular wisdom...so why TINKER with a winning formulae....
I agree with your take on sectors...but if you trade them around OB & OS RSI numbers...the returns are greater......
I may have an advantage because I do monitor about 50 momo stocks very closely.....thus relative positioning becomes critical....
Saleem
Hi Troy,
Tape reading is an art not science.
This is how I do it......
Start with intense FA......you must know what you are buying....
Then go to TA......you must know where that stocks is from chart point of view.....RSI gives it away for me......
I buy when any good stock is in oversold area.....& sell any stock when they are in overbought area....
I have emotionless trading style....name of any 50 stocks which I monitor are interchangeable any moment.....as long it is making money for me....
The final part of tape reading entails ...volume MUST be in millions or I do not touch any stock......
Tape gives me a buy signal when any stock has pulled back to support area...and have gone sideways for few days......
The it is a BUY......
Selling is the exact opposite of buy......
When tape stalls @ resistance ...take the-money & RUN.......
Learn everything about RSI then you will know what tape reading is all about.....
Hope that explains for the MOST part......
Final ingredient to my thesis is....never be afraid of a down day....because that day MAY give you a better strategy to work from...
Saleem
Here I go. Here is my WATCHLIST for possible buys. Since My Questrade account is not up and running yet, I will be on the sidelines for another week. I intend to buy 5 stocks (same amount each) in five different sectors. Here is what I like:
HLX (Helix Energy Solutions Group)Great Growth. Looks undervalued and ready to pop.
GEOY (Geoeye Inc) Been following this one for a while. Commercial satellite imagery (Launch is nearing!). Well run company. Needs volume but slowly gaining steam.
GME (Gamestop) Excellent Growth. Hot sector. Kind of stock I like after a selloff, always good rebound.
SNCR (Synchronoss Technologies, Inc.) Sales on fire. Software behind the iPhone.
WAT (Waters Corp) Great sales and EPS growth. Innovative products (Scientific & Technical Instruments) A more "conservative" bet...
To All, feel free to share your thoughts or even burst my bubble! :-)
Hi Frogvest,
Thanks for your effort to come up with frog5 list of stocks to crawl with......
I am sure that lot of people will look @ that list.....
Just for your info 600 visitors come to this BLOG daily.....43000++ visitors in eight months....more than many yahoo MB put together.....
Your stock selection has hit prime time now.....
Saleem
Food morning Saleem, nice press release concerning LDK growth and earnings projections this morning. Think we will see rewards today? Doug...
I guess I was subconsciously hungry this morning, with my my Freudian greeting, Saleem. LOL... I think pre market action answered my question.
Hi Doug,
Good Morning,
We will see mother of all rally in LDK today....
Already flying in pre-market $$$
So fasten your money belt !!!
This is the-2008 stock $$$
So sit tight with LDK & sip morning coffee.....good to the last drop $$$$
Saleem
SALEEM
Good Morning all!!
I like the preMarket action today
LDK is up Huge as is SOLF. Perhaps this is a breakout for the solar sector?
I appreciate the information on how you use stockcharts. I have used and paid them now for 3 years and never used the gallery view before. WHat a blessing that is! All the information I need on one page. And it is free. Do you get the the RSI from Yahoo? or from stockconsultant?
As always great trading to and God Bless
Madmax
Hi Madmax,
Stockcharts.com is a gift to all traders/investors.....
RSI info I get from same place FREE ....
If you click "default sharpchart"(top left in gallery view) you will get 90 days RSI 50 DMA & Chart in one page....another 10 second glance gives you everything & more.....
As I always say...all the good things in life is generally free except food & shelter for which we all have to work very hard !!!
Saleem
Wow... I am looking at my watchlist and 3 out of 4 stocks are green. I did not check how the Dow or Nasdaq were doing until a few minutes ago... I was assuming the market was on fire... It wasn't the sace. You are right Saleem, no need to worry about the market, worry about the stocks! Did you see CMED go?!? Nice action (that's on that board I found out about you... :-) )
Hi Frogvest,
Too many investors/traders worry about economy & markets.....Instead if everyone do homework on stocks FA/TA.....then they will realize that all those are NOISE.....which is a MAJOR hindrance to making money.
No matter what type of economy there @ least 100 stocks which do well.....so with homework it should be easy to find @ least 2 which should workout.....
Sometimes stocks STARE @ our face but we do NOT see it !!!
Saleem
PJ is still trying to mess up LDK:
Piper Jaffray Still Negative on LDK Even After Updated Guidance Jan 2, 2008 10:43AM
Piper Jaffray comments on LDK Solar (NYSE: LDK) following an update on guidance from the company, Piper reiterated their Sell rating on valuation and lack of clarity surrounding its poly supply (cost) and its polysilicon ramp.
The firm said, "If our thesis is correct, LDK's gross margin for 2009 would be less than half its guidance. In conclusion, the press release does not increase our confidence in LDK's ability to source poly or make its own poly. The stock is up ~5% intra-day on what we believe to be short covering on today's announcement."
Piper Jaffray has a $34.50 price target on LDK. The stock is currently at $49.40.
Saleem - I have been reading your blog for a month now - you are a nice person and I have come to believe you know what you are talking about. I have a question, please. How do you invest in the Canadian currency you mention? Does it require a differnet kind of account?
Hi Donrey,
I am based in Canada...so I have a choice of keeping my trading account in either US$ or Canadian $.
TD Waterhouse in Canada always price your account in the currency you have chosen.....
So...when Canadian $ was going UP against US$...I kept my trading account in CAD.....and I got the benefit of about 35% increase in my EQUITY in the last two years......which I do NOT talk about or factor in my GAIN for last two years......
On nov 7 @ 830 AM...I switched my entire account in US$...so i bought US$ from my Canadian funds @ absolute PEAK...I got $1.0980 to convert......CAD has been going down ever since and my equity has GROWN each time US$ goes UP or reverse is ture if US$ goes down against CAD.....
Currently CAD is down against US$ by 27 tick......
Please do NOT dabble in currency future in any other way......
I DO expect US$ to stay strong against CAD for next 2 years...all my opinion of course.....
Thanks for visiting my BLOG....
I will answer any further question if you have any.
Saleem
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