Markets have completed first week of pullback in ten weeks.......
Some traders ARE surprised @ this pullback.....which was expected by majority of traders......
When markets moved UP 40% from lows in a 9 consecutive week......it was inevitable that we pull back in a hurry......
As this market IS an ascending market..these corrections will be sharp & swift.......
I personally feel that we are very close to moving back UP.......
RSI analysis is telling me that 50 to 70 RSI will be the range in all indices...currently we are in 50+ area......
I am focused in 4 month RSI as my guide.....here is the latest reading from 4 month trend line :
S&P 500 52.72
Nasdaq 51.29
Dow 53.49
Based on the above Nasdaq IS the-most oversold and is likely to turn UP first.......
This correction in market is necessary & healthy.......
Most technicians/traders are expecting S&P500 to go to 1000 to 1050 by the end of this rally...which they think will end sometimes by fall...then a pullback of bigger magnitude......
So if we take the expected view of 1050 in S&P 500 then we have another 167 points or 18.9% further to go.....not bad considering we have already moved UP 217 points or 32.58% as of Friday's close of 883.......
For traders this is a stock pickers dream as we are rotating back & forth between different sectors......
IF you do NOT trade your position then there IS a CHANCE that you will be losing all your gains with market correction.......
Sometimes market corrects & other times stocks corrects based on their fundamentals or analyst agenda.....so be on guard......
Once you take profit...nobody can take it away.....an old reliable formulae which works 100% of the time......
Easy money has been made.......I hope you all have analyzed your total $ or % returns to cross check against market gains...if you have exceeded market gains then you are doing well...BUT do NOT be complacent as the returns CAN evaporate if you are not watching your position closely.
Those who have lagged the market returns.....then it is advisable to "rethink" your strategy and make changes.....
BUT ..if you have actually lost money by Friday's close........then it is time to do a major overhaul of your strategy & SUITABILITY of your trading style.....?????
Going forward...my strategy will remain "to book profit when it is there"...as I expect markets to be "more volatile" than recently observed.....like more UP & DOWN days than what we have experienced....OR loss trimmed or GAINS not lasting......
FEAR will be more pronounced based on conflicting Data.....
So...it is time to be nimble & quick IF you are a trader......
I have preached & implemented DIVERSIFICATION in many sectors & NOT being
over-exposed financially..especially NOW.......
Here is my portfolio weighting & sectors as of Friday's close :
EGLE 17.2% Bulk Dry Shipping
MPEL 14.13% Casino operator in Macau
PMCS 24.93% Communication chip/Tech
PALM 29.51% Smartphone/Tech
TLM 14.23% Oil producer
It is important to know the fundamentals & technical picture of your entire portfolio...do NOT buy just because someone or me are fond of some name...it IS important to do your OWN homework & KNOW what you are buying & WHY you are buying NOW.......
There is nothing WRONG in REDUCING exposure in market or INCREASING exposure in market if we KNOW where we are in the trading cycle.....this approach keeps me "ahead of the pitfalls which is always there in the TAPE"
We are all expected to learn from each experience in the market & adjust accordingly.....
BLOG does NOT give buy or sell.
Saleem
3 comments:
HELLO to all
Her is IBD take on the marketNasdaq's Winning Streak Finally Snaps At Nine Weeks
By DONALD H. GOLD, INVESTOR'S BUSINESS DAILY
Posted 05/15/2009 07:19 PM ET
Featured Stocks
IBM
Intl Business Machines
RHT *
Red Hat Inc
* Top-Rated Company
The market ended a tepid week with moderate losses Friday.
The NYSE composite fell 1.2%, the S&P 500 lost 1.1%, the Dow dropped 0.8%, and the Nasdaq dipped 0.5%.
Volume fell on both major exchanges. That's a bit odd, given that Friday was an options-expiration session. At the same time, it's encouraging when the market falls in soft trading.
Energy and financial sectors dominated the list of the day's biggest losers.
Friday-to-Friday, the Nasdaq fell 3.4% and snapped its nine-week winning streak. The S&P 500 lost 5%, the NYSE composite 5.6%, the Dow 3.6%.
The Nasdaq and NYSE composite have met resistance at their 200-day moving averages. Also, all indexes closed near the low of the week's range.
Still, volume was lower than in the previous week, suggesting that the market is making a normal pullback.
Leading stocks remained subdued but managed to outperform the market Friday.
The IBD 100 rose 0.1%. It fell 3.5% for the week — in line or better than the major indexes.
IBD's gauge of top-performing stocks had been lagging the market for most of the current uptrend.
A few leading stocks saw some action.
Red Hat (RHT), which runs an open-source operating system, shot up 1.74 to 19.86 on talk that IBM (IBM) may acquire the company.
Red Hat shares flew past the 19.26 buy point from a flat base. But the company's earnings rose just 10% in the latest quarter, and analysts foresee shrinking EPS growth for the next four quarters.
After a long advance, it's reasonable to expect some consolidation. With the uptrend under pressure, it's smart to be cautious with any stock you buy and take profits in some cases.
In past major market bottoms, indexes have rebounded strongly, then paused before mounting a new charge. At that point, many leading stocks emerged.
Today's Market Pulse shows fewer distribution days. The April 14 and April 22 distribution days have been removed from the count.
As indexes rise from past distribution days, those black marks become less relevant. What's more, as market volatility has cooled, it's reasonable to allow for a smaller distance before a distribution day is seen as irrelevant.
What were the top-performing groups for the week?
On that front, it was largely defensive plays, such as for-profit schools and food-related industries.
Tobacco, a longtime defensive play, was the fifth-strongest group of the week.
her is the IBD 100 listing--enjoy maybe find some good investment ideas
% Off
Rank Company Symbol Price High
---- ---- ---- ---- ----
1 VISTAPRINT LIMITED VPRT 37.4 -5.2
2 GREEN MTN COFFEE ROASTRS GMCR 77.82 -8.8
3 STARENT NETWORKS CORP STAR 18.48 -11.2
4 NEUTRAL TANDEM INC TNDM 26.64 -10.8
5 LONGTOP FINANCL TECH ADS LFT 23.07 -19.7
6 NETEASE.COM INC ADR NTES 30.45 -6.7
7 WORLD FUEL SERVICES CORP INT 39.66 -7.8
8 NEWMARKET CORPORATION NEU 65.8 -18.6
9 JOS A BANK CLOTHIERS INC JOSB 36.85 -13.3
10 SHANDA INTERACTIVE ENTMT SNDA 48.5 -10
11 QUALITY SYSTEMS INC QSII 55.08 -4.5
12 PRICELINE.COM INC PCLN 99.66 -30.3
13 NETFLIX INC NFLX 38.5 -23.4
14 H M S HOLDINGS CORP HMSY 35.19 -8.1
15 INERGY HOLDINGS LP NRGP 38.28 -4.4
16 W M S INDUSTRIES INC WMS 30.41 -22.3
17 HANSEN NATURAL CORP HANS 42.61 -3.2
18 TELVENT GIT S A TLVT 21.35 -25.5
19 N V E CORP NVEC 35.87 -16.6
20 BUCKLE INC BKE 31.66 -29
21 CHIPOTLE MEXICAN GRILL A CMG 74.86 -26.4
22 STEVEN MADDEN LIMITED SHOO 26.66 -12.3
23 CERNER CORP CERN 55.5 -4.5
24 AEROPOSTALE INC ARO 31 -18.3
25 ORION MARINE GROUP INC ORN 17.09 -12.1
26 SYNAPTICS INC SYNA 30.35 -17.9
27 ROCK TENN CO CL A RKT 36.68 -20.9
28 S X C HEALTH SOLUTIONS SXCI 20 -14.6
29 BUFFALO WILD WINGS INC BWLD 34.56 -23.2
30 CREDIT ACCEPTANCE CORP CACC 20.94 -33.6
31 MCAFEE INC MFE 38.04 -7.2
32 AARON'S INC AAN 30.15 -14.4
33 RED HAT INC RHT 19.86 -20.1
34 BRINKS HOME SEC HLDGS CFL 27.71 -8.1
35 SYNNEX CORP SNX 23.47 -14
36 MIDDLEBY CORP MIDD 45.5 -31.1
37 PEGASYSTEMS INC PEGA 24.31 -4.5
38 AECOM TECHNOLOGY CORP ACM 29.79 -13.7
39 FACTSET RESEARCH SYS INC FDS 55.73 -18
40 THORATEC CORP THOR 27.87 -16.6
41 U R S CORP URS 46 -6.3
42 PAPA JOHNS INTL INC PZZA 27.11 -11.6
43 UNITED NATURAL FOODS INC UNFI 24.4 -15
44 AMERISTAR CASINOS INC ASCA 18.76 -18.4
45 RITCHIE BROS AUCTIONEERS RBA 23.21 -17.8
46 DOLBY LABORATORIES INC DLB 38.64 -19.5
47 COGNIZANT TECH SOL CL A CTSH 25.76 -30.6
48 SOUTHWESTERN ENERGY CO SWN 39.05 -25.9
49 SOUTHSIDE BANCSHARES INC SBSI 21.79 -15.3
50 TYLER TECHNOLOGIES INC TYL 16.32 -11.6
51 EHEALTH INC EHTH 17.64 -31.9
52 COMPUTER PROGRAMS & SYS CPSI 32.67 -13.4
53 AUTOZONE INC AZO 158.01 -7.1
54 LINCOLN EDUCATIONAL SVCS LINC 18.5 -7.5
55 CUBIC CORP CUB 33.64 -4.5
56 O REILLY AUTOMOTIVE INC ORLY 36.17 -10.7
57 COPA HOLDINGS SA CPA 35.2 -16.2
58 PETMED EXPRESS INC PETS 15.83 -16.8
59 TOWER GROUP INC TWGP 25.43 -18.1
60 SYBASE INC SY 32.81 -11.3
61 SYNTEL INC SYNT 28.33 -25.5
62 J & J SNACK FOODS CORP JJSF 37.83 -5.8
63 IRON MOUNTAIN INC IRM 26.95 -13.8
64 B M C SOFTWARE INC BMC 34.41 -15.8
65 I C U MEDICAL INC ICUI 36.11 -4.8
66 GYMBOREE CORP GYMB 33.4 -30
67 CARTERS INC CRI 20.59 -13.7
68 TERADATA CORP TDC 20.6 -24.6
69 ADVANCE AUTO PARTS INC AAP 40.66 -10.7
70 CHILDRENS PLACE RETAIL PLCE 32.31 -25.6
71 VISA INC CL A V 65.07 -26.1
72 SUBURBAN PROPANE PARTNRS SPH 40.28 -5.5
73 VALEANT PHARMACEUT INTL VRX 20.09 -18.5
74 PANERA BREAD CO CL A PNRA 51.02 -21.9
75 MEDASSETS INC MDAS 16.97 -12.5
76 NATIONAL PRESTO IND NPK 73.31 -9.5
77 DOLLAR TREE INC DLTR 42.2 -6.9
78 C E C ENTERTAINMENT INC CEC 31.08 -20.4
79 BIG LOTS INC BIG 24.28 -31.3
80 MONRO MUFFLER BRAKE MNRO 26.64 -9.4
81 M Y R GROUP INC MYRG 16.05 -10.8
82 AMERICAN ITALIAN PASTA AIPC 28.11 -21.3
83 CROWN HOLDINGS INC CCK 23.99 -19
84 A A O N INC AAON 19.95 -13.3
85 PRE PAID LEGAL SERVICES PPD 40.16 -11.9
86 LIFE TECHNOLOGIES CORP LIFE 36.21 -23
87 TEKELEC TKLC 15.98 -9.9
88 ROSS STORES INC ROST 35.19 -15.3
89 DIGITAL RIVER INC DRIV 34.6 -23.9
90 PEET'S COFFEE AND TEA PEET 26 -12.6
91 LANCASTER COLONY CORP LANC 44.4 -9.2
92 FAMILY DOLLAR STORES FDO 30.29 -13.5
93 AIR METHODS CORP AIRM 29.12 -24.5
94 DARDEN RESTAURANTS INC DRI 34.1 -17.3
95 ILLUMINA INC ILMN 35.64 -25.6
96 F 5 NETWORKS INC FFIV 26.35 -26.5
97 EMERGENCY MEDICAL SVCS EMS 33.06 -15.5
98 MICROS SYSTEMS INC MCRS 23.38 -32.1
99 MARVEL ENTERTAINMENT INC MVL 31.69 -17.7
100 REHABCARE GROUP INC RHB 19.95 -11.8
Hi Madmax,
Thanks for your IBD 100 list & nasdaq analysis.
Saleem
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