5 financial stocks in rising trends

November is here and Florida is a mess.
Calm waters after the storm. October
was a stormy month for stocks. I did not fare well. That is the nature of the
game. Certainly the aim is to perform well. That is the ultimate concern and
primary intention relative to involvement in the stock market. I stick with
winners and dispose of losers quickly. Look at SYMC. Here is a stock that I
got back into because it appeared as though it was breaking out. It failed
yesterday as news got a reaction. It is not the news that is important. It is
the reaction to the news that really matters. So SYMC tanked and I sold the
small position because all I did was stick a toe in its pond and promptly lost
over 20% and if I did not sell when I did then another 3% would have
evaporated. I have learned to cut losses. That was the major faux pas during
the brutal bear days of 2000-2002. But certainly let the winners run and never
run from a profit in an extended stock that has been held for a while. I admit
that I took a little off the table yesterday letting half the position carried
in ESLR go. It was let go near the top. If the stock closes above 9.65 in
decent volume and now make that 9.72,then I intend to buy it back quickly. I
am flexible. It is vital to be flexible in this game. In this piece the focus
is on financials. Here I have put together a basket of financials that teeth
ought to sink into. Each of the 5 charts examined are in rising trends. The
common thread other then being in the financial segment of the market is that
they are all advancing in price. They are moving up. They are on the rise.

Goldman Sachs
(
GS |
Quote |
Chart |
News |
PowerRating) 129.13

What did I say the other day in “Drop The Blues: Its Rally Time” about GS? I
said what a lovely chart. Very pretty. Lovely stunning advance expressed in GS
and right now it is certainly overbought. Or is it? It may be slightly over
bought near term but over the long stretch this stock will provide solid gains
until proven otherwise. In this you merely follow the tape and trust the
pattern of trade. It’s a keeper and ought to be bought coming into the 124
range. It ought to come in and that action provides the chance to get involved
in a current winner. Notice I said current winner. It will not always be a
winner and that is why stops are important. Risk must be managed. It ought to
be actively managed. Just being in the SPX over the last 6 years hasn’t really
made any money has it? If you invested 10k in the SPX 6 years ago you would be
under water today. It pays to be involved only if the trend is in your favor.
It pays to be long GS.

Merrill Lynch
(
MER |
Quote |
Chart |
News |
PowerRating) 65

Another stock mentioned in the November Wealthcast and written about a number
of times over the past few weeks. It is a stock in a new advance and the
advance is getting legs as it crossed the top of its base. It traded yesterday
at its 52 week high at 65.30 before backing off ever so modestly. Sometimes
you have to be a prick to get attention. I just felt like saying that but
there are stories attached to that type of behavior and attitude that I won’t
get into. I can be an effective prick. I rarely need to resort to that. I will
tell the story sometime just to amuse you. Now back to MER what a lovely site
to behold. Stunning and thrilling is all I could say. What, go to Las Vegas or
Atlantic City for thrills when I never really have to leave the comfort of my
computer. I get all the thrills I need having that close by. What does it
provide? It provides the necessary information that enables money to be made.
It is awesome. So Merrill and Goldman are in the money business and they are
making a ton of it and that pleasant news is reflected in the action of the
stocks. Examine the chart of MER and see the stunning move. It crossed the top
of its base a base that is close to 2 years old. Remarkable. I am involved. I
buy whatever comes across my desk that appeals to 20 years experience at this
game. No what I mean? I never buy a lousy chart or God forbid keep a lousy
loser. MER right now is winning big. The advance really began in May of 2005
after making a triple bottom. Nice, a triple bottom. So what. That was then.
It advanced off that triple bottom and the advance has better then average
momentum.Volume is nice and steady. Good stock to get into right now. Stick it
in. Stick in a toe. Stick in a toe and let MER take you to the promised land. A
win is winning and MER is a winner right now.

UnumProvident
(
UNM |
Quote |
Chart |
News |
PowerRating) 21.85

I guess I am not getting into any shorts today. In fact several were covered and
nipped in the bud. No I am in to a theme that centers on a basket of financial
stocks and this one is timely. UNM is a timely stock to get into now and I
bought more of it yesterday as it crossed 21. Now buy it coming in because the
break out is likely to get a test and if it passes muster then it’s off to
higher price zones. It gapped up yesterday and may fill that gap.

CNA Financial Corp
(
CNA |
Quote |
Chart |
News |
PowerRating) 31.62

What
a nice steady rise CNA has provided. A nice and steady rise. An insurance
stock. Well it is a happening insurance stock. What does that mean? It means
that CNA is in advance and is enhancing the net worth of its shareowners. It
is in a decent advance right now and ought to be picked up coming into support
as the current over bought or slightly over bought condition gets adjusted.
This stock broke the top of its base in good trade recently and is in a new
advance. Best time to get involved in stock is at the beginning of an advance.
Place the stop on the 50-day line for a swing.

The St. Paul Travelers
(
STA |
Quote |
Chart |
News |
PowerRating) 46.07

Another insurance stock. Why not it is moving in the direction that provides
holders long the stock a decent gain. All the insurance stocks are on a tear.
It pays to get involved. How do you play it right now? Right now the way to
play this stock is stick a toe in the water.

Right
now our futures are down slightly while markets across the globe trade up.
Futures are down modestly and that is a good sign. The Dow is a drag on the
markets inclination toward higher price levels. The Dow is rather stingy in
its movement and appears to be manufacturing a negative divergence. The Dow
really has to angle above 10500 to keep this rally alive. This morning we have
calm seas. Call it mellow yellow. Just good old mellow yellow on this calm
early November morning.

Jack S. Rothstein

Rothstein Investment Advisory Services, Inc.

3600 Chain
Bridge Road, Suite 200

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.