Sunday, September 28, 2014

We are ready to rally.....

TAPE has seen relentless selling in last 4 trading days, Dow had a swing of triple digits in last five trading days.

Here is the damage in each most watched barometer :

Down down 2.33%

S&P 500 down 2.64%

Nasdaq down 3.12%

VIX UP 44.88%

All of the above numbers are from last five trading days from low to highs or high to lows......

This correction was very painful, as sharp downward pressure felt in equities.

BUT...the good news is .....it is all in the past....

NOW...we are all set to start repairing the damage....

US$ has taken toll in all commodities, base metals, energy, natural gas & my favorite Gold....but there may be a silver lining...US$ is @ 4 year high and may need a well deserved pullback, which may give damaged sectors an uplift.

Bears are stuck @ 15.3%...extremely bullish indicator, & institutional money managers are also bearish and have low allocation...all pointing to a "reliable contrary indicator"

We are approaching strong equity season a bit early, starting next week we may be starting a rally due to last week pullback.

SO...it is a good idea to reap the reward of your strategy by being long ......

We found support near 50 DMA & reached the lower end of trading range or channel last Thursday....

Indices technicals are healthy now & may be heading towards new series of all time highs......

SO..position accordingly & stay the course till 1st week of January 2015.....

BLOG does NOT give buy or sell.

Saleem

5 comments:

stocktrader_1996 said...

Hey Saleem,

When I looked around, I didn't see anything good. Granted we might be a bit oversold based on the drubbing of last week (although Friday worked off that pretty well), but all technicals point to heaviness in stocks to me. I think it is important to be extremely selective and attentive right now.

Stocktrader

Stocks100 said...

Hi Stocktrader,

I looked closely @ sentiment and contrary indicator plus seasonality..they are all saying higher prices on the way.....

Saleem

Western Firebird said...

Bought small amount of RAD @ 4.99

WAG reports tomorrow. RAD and WAG could both crash then.

If they both crash tomorrow or if they both slowly fall this week, I'll probably buy a large amount of one or the other.

I'd previously sold RAD @ 5.38.

stocktrader_1996 said...

Hey Western,

There's a lot of talk about nasty viruses this fall. I don't know what vaccination offerings RAD has, but RAD/WAG seem like they might be good stocks to be in right now.

Stocktrader

Stocks100 said...

Hi Firebird,

Good luck with RAD.

Saleem