4 Good looking stocks regardless of market direction
California here I come.
I want to get some sand in my shoes and lose those DC blues. I will go back to
California. I will be holding court in room 812 at the Loews Santa
Monica. I will be back there in the first part of December. Back to paradise.
That is called living. If you are here then you might as well live. Throw
caution to the wind and get involved in the new market as it turned. You can
profit in any kind of market. That is a true statement. You can do anything. But
will you. Do you have the gumption or as they say in the street of NYC the balls
to get involved in the current market with its nasty bearish waves relentlessly
smacking against the hide of players that are net long. I am net long and this
market took a bite out of my hide. No question about that. I have confidence in
the charts. I adhere to a discipline that forces action when stocks involved in
appear to fail. Stocks like
(
CMVT |
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PowerRating) and
(
SBUX |
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PowerRating). I admit failure when I
sell or cover, and take a loss. The loss is almost always modest. That is the
key to enable you to stay in the game. I will never stop playing at the greatest
game invented to amuse the minds and hearts of humans several hours a day 5 days
a week. The market is always filled with chances to gain. In a bear market the
odds favor the short side of the equation. In a bear market it is better for
your pocket book to be net short. It doesn’t mean getting out of the market on
the long side at all. Just be net short.
The way to play the current market is
selectively. Select wisely those ugly charts and short them up. The current
market is oversold. The selling came hard and fast. A number of tech stocks fell
near 10% off there near term peaks mostly made around 10/4.Many technicians view
the current market as dark and dank. It’s a tough market to make money in. If it
goes against you its better to surrender and move on. Surrender may save your
hide and enable you to continue to play. Today I am looking at about 60 stocks.
I am long and short. I am currently net long playing for a bounce. I am down for
the month of October. Got caught while having a California dream. It happens.
Wasn’t the first time and won’t be the last. It is part of the game. How are you
after getting caught? I tend to come back because I cut my losses and stay with
the winners. The winners are technically healthy. Technically healthy stocks
ought to be bought coming in. So when I said I am inclined about adding to my
position in AAPL after it crashed the other day I did just that and the play
worked well. I have since taken that addition off. I sold into strength
yesterday and took a piece off. Lets get into a few stocks long and short. The
good, bad, and ugly. It’s all about being average. That is what a master sushi
chef once told me and a marine buddy of mine one night not to long ago. It’s
just about average and less then average. Nothing more. Well, the sushi master
admitted without blushing, and with his chest out, he softly exclaimed that his
sushi is just ¼ above average. So am I.
Apple Computer
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AAPL |
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PowerRating) 53.74
Yes, I am involved. AAPL is a highly liquid stock
that doesn’t need to get pumped up. That is not what this is all about. It is
about informing you about what gets inside the head of a stock market operator
when hands fold in reaction to news. The news apparently was not that bad after
further analysis. That is what appears to be the case regarding AAPL. The stock
popped right back in heavy trade. The volume was heavy yesterday but lighter
then the volume that occurred in the sell off the day before. AAPL peaked on
10/4 along with most leaders. The peak is 55.35. The stock must go beyond that
level to sustain its powerful long-term advance. The stock touched the 48 zone
as it briefly broke below its 50-day line. It now trades above all key
inflection points and perhaps its break down the other day is false. I am
involved in the stock. Use 47.89 to stop the loss.
Starbucks
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SBUX |
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PowerRating) 52.90
I was short SBUX. I am no longer. Will not
hesitate to sell short if it breaks down. Right now it is making an attempt to
climb into the mid 50’s. It can go either way. I would rather not get involved
long and it is trading too well to be short this stock right now. Although it is
off the focus list and no longer held it is still tradable and the sense that I
get from the tape is a stock that is in the process of making a major top. The
long term view although favorable at this moment is still shaky. SBUX turned
positive but is still on shaky ground. I am out of this stock right now. I will
short it again on a drop below 50.
Yamana Gold
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AUY |
Quote |
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PowerRating) 3.94
Yes, I know that the stock broke below its 50-day
moving average. I know that because I watch it and all the other instruments I
am involved in like a hawk and each individual stock has a strategy or game plan
wrapped around it. The game plan is adjustable. In other words be flexible. It
is important to have exposure to metal related stocks in this current market.
AUY is a gold stock. A small one. It took a hit, as did other names within the
metals segment. It is trading below its 50-day line. Long-term view is a healthy
stock that indicates a solid advance. The intermediate term turned negative. The
metals sector is in a secular bull market along with energy. Corrections occur
in bull markets and those adjustments provide buying chances. AUY is a good buy
at current levels if you don’t mind a couple of funky months ahead. Use the
200-day moving average as a protective stop. Place the stop at 3.49.
Tellabs
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TLAB |
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PowerRating) 9.60
Of course a real dog. Yes, a real dog of a stock
if they’re ever was one. I am into the dogs of the world. I own LU, JDSU, COMS,
NT. Dogs each and every one of them. I will prove that money is made when
involved in dogs. TLAB has shown some life recently. It has good energy around
it. It has a decent pace of trade right now. It took its little hit in stride.
If NASDAQ rallies up from its current oversold condition then TLAB could test
its recent high. That is 10.75 made on 10/3. It really needs to cross 11.40 on a
close and it marches into the mid teens with ease. That is the exact bet on this
one. The bet is that the stock takes out 11.37 a high made on 1/16/2004. That is
what I am looking at on a swing. TLAB is a favorable chance for those that are
seeking a good swing. Place the stop at 8.55.
Futures are higher this morning. Inflation is
running in reaction to Katrina and Rita. The fed is more concerned about that
then anything. Disasters are ultimately good for the economy. Rising energy
costs are getting passed to the consumer. This will be a weak Christmas. Sales
will be soft. Look at the action in retail stocks and notice the downtrend. Look
at the action in housing stocks right now and what does that say about the
real-estate market down the road. The real estate market will come in. How hard
remains to be seen. A crash and I am all over a cozy little house near the beach
in Santa Monica, stones throw from Venice. To break off my friends in paradise.
Jack S. Rothstein
Rothstein Investment Advisory Services, Inc.
3600 Chain Bridge Road, Suite 200
Fairfax VA 22030
Phone 888-343-4825 — Fax 703-385-7232
www.jrmoney.com
— www.wealthcast.com
Jack Rothstein is the President of Rothstein Investment
Advisory Services, Inc. and is a 20-year veteran stock trader and a money
manager.
Mr. Rothstein also writes Wealthcast, a monthly newsletter about the technical
behavior of the markets. He has been quoted on Bloomberg, CNNFn, the Dick Davis
Digest and the Dow Jones Newswire. Since 1993, Mr. Rothstein also hosted
WealthCast, a radio show in the Washington DC area covering the stock market.