Rediplus Review
July 13, 2008
Rediplus is Direct Market Access stock software tool developed by Goldman Sachs Execution & Clearing. It has its presence in all the major markets like U.S., Canadian, European and Asian sources of liquidity for equities. It has some nice features and is very easy to use. It offers hat offers traders the flexibility and speed [...]
Stocks Move Higher, On Higher Trade But Continue to Run in Place
July 11, 2008
Not much in the way of commentary on this market. There are only so many different ways you can say seemingly the same thing. Once again, stocks moved higher on higher trade but have not produced anything over the past week. Ideally, when stocks bottom they should immediately move higher on higher volume. Too bad what we have seen is the upside volume, although higher than the previous day fall over the past few weeks. Even secondary items, like NH/NL and Options volitility show that any rally here will not last. I am cash heavy and very skeptical of any move the market makes here.
I did find an interesting chart. Ticker: CAP. 3 things I like about this company: Sales MRQ up 20%, EPS MRQ up 267% and it sports a ROE of 25%. The chart has been in a pretty tight flat base over the past 9 weeks. Yesterday it broke out above the base high on stronger volume. Relative Strength hit a high as the stock moved into new high territory. Its a sign of strength. In this market environment, if this stock doesn’t move higher I will definitely be restricting my position. There is no way I am going to let any losses grow, positions must be cut if they are not working properly. Lets check out the chart:
Stocks Fizzle as Volume Dries Up
July 10, 2008
Price action continues to be very poor on Wall Street. Its not surprising action continues to be poor given some market internals. I have spotted these out over the past few posts and they have no improved. New Highs are enemic and the VIX/VXN continue to show a lack of fear. Any rally attempt that does not have a favorable NH/NL ratio will not be a powerful rally. In addition, without the VIX/VXN indexes showing any sign of fear it is highly unlikely a new bull market will emerge.
It took the market nearly 13 years after the 1929 stock market crash to form a tremendous bull market run. Although we are dealing with high oil prices like the 70s this market action is more tied to the 30s and early 40s. History is an amazing thing to study because patterns tend to mimic themselves and we are closely aligned with that time period. Are we going to wait another 3 years for a bull market? It is quite possible it will be that long before we begin to see stocks that move 1,000% or more.
Extreme Oversold Conditions Set Stocks for a Massive Rebound
July 9, 2008
For much of the trading session on Tuesday it was a volitile day where stocks couldn’t decide whether the downside or upside was the place to be. It wasn’t until late in the session where shorts started to cover sparking a late day short covering rally. Volume was tracking higher all day long and finished higher on the day. Helping stocks surge was the huge price drop in crude oil prices. Tuesday marked the 2nd day of an attempted rally and we’ll need to see continued upward movement with volume favoring the long side, heavily!
Once again New Lows (NL) outpaced New Highs (NH) by a large margin; 27 to 1. In addition, VIX and VXN failed to reach new highs as stocks pushed to new lows. Ideally, you would see NH outpace NL and VIX and VXN hitting new highs as stocks hit lows. Unfortunately we have not seen enough fear in the market to warrant a true market bottom. Like March, VIX and VXN didn’t hit new highs as stock hit lows signaling the rally forming wouldn’t last. The same will go with this rally attempt even if it follows through.
Near Term Weakness Always Leads to Long Term Gains
July 8, 2008
Stocks once again took a dive and notched some hefty losses. The NASDAQ was held up by AAPL whose lower volume effort looked mediocre at best. We are simply in a weak time for stocks at the moment. Following the removal of the uptick rule shorts are able to work more freely in the market. There is no question that, for now it has bolstered their position. Remember, human emotion is always to overshoot and there is no doubt there are far too many shorts in this market. It will create a situation, when ripe a rush to cover will send a flurry of sideline cash into the market. This could very well spark a tremendous rally in stocks, but we simply do not have the charts nor earnings firepower to do so just yet. Financials continue to weigh heavily on the markets and once favored big oil names continue to falter. We haven’t gotten to the point of capitulation, there is still some hope we rebound.
Enjoy
Stock Watch Pro Review
July 6, 2008
Stockwatch pro is a real time analytical stock market software to perform a kind of technical analysis on the stocks that meets the traders criteria. It is very flexible in nature. It is not very popular so far but when it comes to delivering results there is not much stock software that comes even close [...]
Global Stocks are Showing Weakier Economic Times Ahead
July 6, 2008
Our new world, the Global Economy. Many pundits are touting the power of the global economy. New powerhouses that are emerging: India, China, Singapore, and Australia. Most notably are India and China, the two countries who hold (seemingly) half of th world’s population. Tremendous growth potential in either country is obvious but, is it reality? I am not denying 20 years from now India and China will have economies that will rival those of the G8’s best but, is it just straight up? In reality, there are natural swings whereby the economy will experience peaks and troughs but end up higher over a long period of time. The United States certainly has seen its growth and corrections even a great depression. It appears our global economy is about to suffer a correction. What on earth could be foreshadowing a downturn? Stocks!
Downturns in the economy are usually foreshadowed by stock market declines. The United States most notable declines were proceeded by the 1929 crash and the 2000 stock market bubbles. Let’s take a look at India’s, China’s, Singapore’s, and Australians most notable indexes:
Happy 4th of July
July 4, 2008
Happy 4th of July! Thursday’s shortened session provided little help to stocks as many on Wall Street were on vacation enjoying this Holiday weekend. Crude oil remains the hot topic on Wall Street as it traded above $144 much of the day. However, we were unable to hit the $150 a barrel like many had anticipated. This proves predictions are like bum holes: Everyone has one and they all STINK! Even without hitting $150 prior to July 4th I still believe Crude is headed higher and much higher than $150 a barrel. The trend is firmly in place and at some point the Oil shorts will become discouraged and rush for the exits. Most likely scenerio will be when our first Atlantic Hurricane threatens the Gulf Coast and its oil rigs. This will only mean more selling for stocks, whether or not it creates shear panic has yet to be seen. Even with $144 a barrel of oil the VIX/VXN have failed to show any sort of FEAR in this market. I’m afraid it will take more than just crude above $150 a barrel to get fear pumped into this market.
Make sure you are safe this 4th of July holiday weekend. Trading stocks is just like swimming with sharks, chances are you will be bitten with a slight chance you get away free. Odds are just not in anyone’s favor at the moment, I like to play when I have the odds in my favor.
Our Bounce Lasts Just One Day
July 3, 2008
Stocks could not manage to sustain the bullish reversal on Tuesday. Crude oil moved higher and continued financial meltdown fears helped push stocks lower. The extreme oversold conditions we saw on Tuesday mid-day were extreme enough to push a rally. However, those oversold conditions continued on Wednesday. Oversold/overbought markets can stretch for periods of time longer than many expect. This is the market where trying to catch a bottom using an oversold indicator will only burn your account dry! Price and volume action are tell us that prices are headed lower for stocks and lower lows are on our horizon. Crude Oil should continue its trend higher and ultimately blow off its top. This market is continuing its bear market status.
Bear markets usually last anywhere from 9 months to over a year. However, Bull markets do not immediately proceed Bear markets as sometimes it takes time to head sideways prior to a new Bull. At some point the financials will clear themselves from the mess they are in and crude oil will top out. History will repeat itself in one form or another we just have to be patient for these things to sort themselves out. In the meantime, enjoy the July 4th holiday…INDEPENDENCE DAY!
Market Bounces Intra-Day, But It was Another Bear Market Bounce
July 2, 2008
Tuesday’s action was following our most recent trend: DOWN! However, when GM news was released a flood of short covering hit Wall Street. This set off a wave of short sellers across the market to head for cover, pun intended. The market got to a point where it could not get anymore oversold and needed to blow off the steam from selling. New Lows (NL) topped out at 1162 indicated that a short term bottom was being put in. Unfortunately, VIX and VXN did not show we had bottomed whatsoever with the VIX merely peaking above 25 level during the morning swoon. We have everyone’s bounce, but unfortunately I believe the bounce will be short lived and yield little gains.
More to come. This rally will be short lived, with VIX and VXN not showing capitulation we will not see meaningful gains.
Reuters Business- Alcoa to slash jobs and sell 4 unitsNEW YORK (Reuters) - Alcoa Inc said on Tuesday it would slash more than 15,000 jobs, halve capital spending and sell four businesses as it reduces aluminum production in the face of the global economic downturn.
- Bank of America selling $2.8 billionHONG KONG (Reuters) - Top U.S. lender Bank of America , raising cash to weather a dismal market at home, is selling a $2.83 billion chunk of its holding in China Construction Bank at a 12 percent discount on Wednesday, according to a term sheet obtained by Reuters.
- U.S. budget deficit seen topping $1 trillion in 2009WASHINGTON (Reuters) - Politicians want American consumers to resume spending to pull the economy out of its tailspin, and the U.S. government is leading by example with a potential $1 trillion deficit in 2009 -- even before a massive stimulus plan.
- Alcoa to slash jobs and sell 4 units
- Market Watch
- Miners lead in Asia as metal prices jumpAsian shares were higher Wednesday after another gain on Wall Street, with mining stocks powering ahead on a recovery in prices for base metals and gold.
- Millionaires join the rest of us in feeling the economic heatAn overwhelming majority of Americans 45 years and older think the economy is in dire straits. That’s not limited to those who live paycheck to paycheck either. A record 80% of millionaires polled in another survey said this is the worst financial crisis they have ever experienced.
- Asia Markets: Mining, metal stocks rise, unmoved by Alcoa newsAsian metal and mining stocks such as Rio Tinto and Sumitomo Metal Mining Co. climbed Wednesday on an increase in nonferrous metal prices, disregarding Alcoa Inc.’s decision to slash jobs and curb output in response to the global economic downturn.
- After Hours: Alcoa shares slump in wake of cost-cutting plan; F5 surgesShares of Alcoa Inc. dropped Tuesday evening as the aluminum giant outlined aggressive cost-cutting plans that will include job losses for more than 13,000 workers, while F5 Networks Inc. shares got a lift following the company’s forecast.
- Latin American Markets: Brazilian investors eye rate cut; Wal-Mart de Mexico downgradedBrazilian stocks rose Tuesday, holding to higher ground as investors eyed the possibility of cut in interest rates following a report that the country’s industrial production dropped sharply in November.
- Miners lead in Asia as metal prices jump