We all have heard "sell in May & go away".......which means by the end of April we should form a short term top in the market....
So we have April to daytrade & lock gains .......
Option expiry is on 16th of April..two weeks away..which may bring more "volatility".....
RSI is Indices are as follows :
Nasdaq 66.51
S&P 500 70.35
Dow 70.55
High range has been in 76 area........either Nasdaq will move UP to its high RSI range or may drag RSI further Down to 50 area....Option Expiry week should be the catalyst......
Chinese PMI has risen 13 months in a row.....
Oil is @ 17 months high.....
Jobs report was better than the headline numbers as 114,000 "real jobs" were created and only 48,000 census jobs ..which was predicted by many to be in 100,000 plus expectations...so headline of 162,000 is "conceptually" equal to 225,000 jobs.......
SO..there is real job growth in the economy NOW......
Stock market has been anticipating/predicting job growth & economic rejuvenation worldwide in this run for 11,000 in Dow..chart looks too steep for my comfort.....a selling may take place.......
Market always gives money making ideas...it may be positioned for short trades ????
SO..locking profit has to be top priority as all good news is here already ......
Market needs digestive period to gather strength again......in the past selling has been in the range of 6% to 9%......this time it may be in the 6% range.....
QID which is double short on Nasdaq may be the best way to HEDGE your portfolio.....hedging near top is a smart move...an insurance which is prudent......
Writing covered call in your portfolio also gives you protection & extra $........
Gold,Silver,Copper stocks are looking better @ this stage in market......
After correction..... Technology is a good bet as many will raise guidance.....
This "sustained" move UP has surprised many including me......so a bearish posture may have been pre-mature BUT not unwise......
It is important to know your stocks fundamentals & technicals .....adaptability is a key to ongoing success in market.....sometimes you have to sell in a hurry & other times you have to buy in nano-second.......
There is no right or wrong way to position in market...as long as it works out in the end......it is always about risk/reward ratio.....
Being diversified in many sectors which is showing strength keeps you ahead of the game.....
Good luck in your strategy.
BLOG does NOT give buy or sell.
Saleem
9 comments:
Saleem
Happy Easter!
I agree with your assessment of the market.
I currently own QID and GLD.
Do you think shorting Stocks or ETF Sectors is also a good option now? Or would that be wiser in mid-April?
Ken
Hi Ken,
Shorting individual stocks is dangerous & am not comfortable even in recommending that strategy....
Less exposure,covered call & some hedges like QID etc has my comfort level....
BUT..those who short individual stocks know how to keep close stops & do well....BUT not for me....
Saleem
SALEEM
wow-great comments to invest by
I like the commodity plays--not sure if AGU/POT are a good play here. Coal should work as should copper.
I still have QID and VXX
MO is due for a breakout!
MU should also spring up today I see $11 ??
Have a great day to all
Hi C,
Thanks for your feedback....
MU should be OK....
Saleem
SALEEM
POT is taking a good hit
Time to buy??
thanks
Hi C,
AGU is a better buy in that sector..more diversified business model....
Saleem
Saleem:
About the AGU plays:
Here is some news that I did not know about
NEW YORK (TheStreet) - Mosaic(MOS) shares fell 4% Thursday afternoon after the fertilizer producer reported disappointing fiscal third-quarter results.
At least one analyst, however, downplayed the miss -- but suggested that more worrisome developments may lie on the horizon, not just for Mosaic but for the fertilizer industry as a whole.
In a note to clients Thursday, Charles Neivert of Dahlman Rose called Mosaic's miss a "timing issue," with a seasonal pickup forthcoming in the company's next period, which will benefit naturally from the Northern Hemisphere planting season.
"On the bearish side," Neivert wrote, "we see potential challenges for fertilizer producers by the second half of the calendar year." His rationale? "'The Runaway Bride' syndrome, i.e. a fear of commitment by dealers/distributors." That is, fertilizer buyers may now be shying away from making the big crop-nutrient purchases they had earlier claimed they would.
Furthermore, according to Neivert, bumper crop yields this year in corn and soybeans may result in weaker crop prices in 2011 -- never a good sign for fertilizer makers, since poorer farmers means a drop in demand for crop nutrients.
Hi C,
Thanks for AG sector analysis ....
This is a daytrading market..so buy anything to sell next day MAX....
Saleem
Market seem to be very tired right now. QID goes down less with market inching up. Vice versa it moves up faster.
I will not be surprised if the market closes lower in the next 2-3 trading sessions.
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