Here comes the question of the year...sell in may and go away.....
Before i answer this important annual event, i must look @ total picture of market.......her are some important stat to consider :
- In last 7 trading days, indices have lost
Nasdaq lost 4.60%
Dow lost 2.84%
S&P 500 lost 2.78%
Russell lost 2.75%
It is obvious that Nasdaq is the weakest of all indices by far.......
- CMF is green in all indices although barely in Nasdaq
- Dow & S&P 500 are showing golden cross
- VIX @ 15.70
- RSI are showing the following number :
Russell 54.78
Dow 51.29
S&P 500 49.97
Nasdaq 39.42
IF i can recall since 2010, numbers were not that low @ all, generally speaking, by May all of the above stats were @ highest point, thus a correction was imminent, NOT such a situation here @ all.
Russell is showing amazing strength, this index is used for future direction of market and is the first one to show extreme weakness.
Based on every single stat listed above, instead of " selling in may and go away " you should be
" buying in May and staying in Market "
We had our first correction already and may have seen the low, there is rotation going on and many hot sector may cool off and laggards may join UP cycle.
World bankers are all in a passive mood which is very good for equities.
There is pulse in world economies and may build up from here although very gradually. China & India are neck to neck in 6% GDP growth, while rest of the world are in 1% to 3% mode.
Stock picking needs to be done with lot of chart study and seasonality in focus, it may not be difficult to make money in rotating market, RSI is a straight give away in terms of when to buy and when to sell, never fight for last $, too risky for all.
Good luck with your own understanding of this May cycle and your own comfort level.
BLOG does NOT give buy or sell.
Saleem
8 comments:
Hi Saleem,
Bought ORCL @ 39.95
They continue to make acquisitions in smaller cloud companies to expand their portfolio of products. Last week it was TXTR, a company I followed for a long time before a short seller put out a nasty piece against them a few years ago. With their aggressive push into the cloud, and currency winds turning much more favorable, I think there is a chance for both multiple and earnings expansion.
Current portfolio: FB GM HUN ORCL FDX SPLK NXPI BAC URI JKS
I have shifted my heavy overweight in cyclicals to some secular growth stories again. This is providing balance during a time when the "easy" money in the rebound has been already made.
Stocktrader
Hi Saleem,
Guess another analyst on same page!
10:10 EDT ORCL, OPWR, TXTR
theflyonthewall.com: Oracle paid reasonable price for Opower, says Jefferies
Jefferies analyst John DiFucci said he believes Oracle (ORCL) paid a "reasonable" price for Opower (OPWR), which, along with the company's acquisition of Textura (TXTR) last week, furthers Oracle's strategy to expand its SaaS portfolio vertically and into the mid market. The analyst, who think's Oracle could make more acquisitions of this type in the future, keeps a Buy rating and $50 price target on Oracle shares. :theflyonthewall.com
Stocktrader
Hi Stocktrader,
Good luck with ORCL, yes you followed TXTR closely, now you have both ingredient with ORCL.
Saleem
Hi Saleem,
I think Bill Ackman made a pretty compelling case on CNBC for VRX's stock. It is certainly very cheap, and the worst of the news flow may be behind it.
Stocktrader
Hi Stocktrader,
VRX is certainly oversold for a year......maybe a very good long term hold.
Saleem
Hi Stocktrader,
Sold FB @ $117.98
Added 30% CNQ @ $29.35
Saleem
Hi Saleem,
Good luck with the swap. I am inclined to go the other direction for now as I think the commodity stocks may need to rest further, but I do think the longer term direction for oil is still higher, and possibly much higher.
Sold URI @ 65.76
I am looking to deploy these funds into VRX, although I am still evaluating.
Stocktrader
Hi Stocktrader,
Oil is very stable @ these prices, which gives lot of leverage to E&P companies like CNQ, they are reporting on 5th May before open, expecting better guidance.
Good luck with VRX focus.
Saleem
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