Don’t Forget, It’s About The Move. Here’s What I Mean…
You know how much I like
to save the famous quotes from the empty suits on the market, and my
recent two quotes have been: 1. “Markets sold off due to Mad Cow disease in the
US” – a classic line. 2. “US stocks posted modest gains Wednesday as a
late-session surge preserved some of the gains touched off by a rally in the
dollar.” Maybe he missed the equity rally since March as the dollar has
declined. On the other side of that, nothing good has come from a declining US
dollar since I started in the ’70s, when gold shot up over $800 as the US dollar
declined. Then the 1987 crash precipitated by a declining US dollar, and to a
great extent, 1994. A short-term fix for trade deficit and economy maybe, I
don’t know, but countries with strong currencies make the best investments. You
should read
Mark Boucher’s book – which is excellent – if you want to learn more about
the subject.
Back to the real world of win or lose, and no
ties. This corner has completed selling 30% of the original position taken on
the RSTs.
Seminar pros are well aware of those RST levels on the daily chart. In these
markets especially, if you don’t bank something at +20%, then good luck on your
mission, and that goes for those of you who just took your first-long term
position since the market lows that had a confluence of many things at the time.
The same empty suits that said “don’t buy them” because of valuations etc, are
saying the same thing now and still haven’t made any money. So does that mean
when the market is up 30% they will say it’s a bull market? It doesn’t matter,
bull or bear — it’s about the move — and they only come along several times a
year from a position standpoint. I will discuss this at length
in June.
The SPX
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) closed yesterday at
953.22, +0.2% and traded in a four-point range above and below 954 from 1:00 –
4:00 PM. The Nasdaq ended +0.4%, the QQQs
(
QQQ |
Quote |
Chart |
News |
PowerRating) +0.2%, and the SMH
(
SMH |
Quote |
Chart |
News |
PowerRating)Â
+0.7%. NYSE volume was 1.5 billion, volume ratio neutral at 53, and breadth
+467. The SPY volume dropped again to 37 million, which was 13% below its
average, while the Diamonds
(
DIA |
Quote |
Chart |
News |
PowerRating) traded -24% of their average volume, and
the QQQs volume increased 12% to 76 million. In the sectors, the retail stocks
gained, with the RTH
(
RTH |
Quote |
Chart |
News |
PowerRating)Â +1.5%, while the XBD
(
XBD |
Quote |
Chart |
News |
PowerRating) was +2.8%
and the Generals have certainly looked across the valley on this group, as it is
up 47% from the March 12, 334 low to yesterday’s 490 high. Some of these
brokerage stocks have been Moon Shots with Bear Stearns
(
BSC |
Quote |
Chart |
News |
PowerRating) hitting
all-time highs and Lehman Brothers
(
LEH |
Quote |
Chart |
News |
PowerRating) +69% since the October lows. The
Generals will be selling them to the empty suits, who will now say how strong
they are relative to the market. They’re the same ones who told you about the
brokerage stocks’ extreme valuation at the lows, no M&A and that retail
investors will be a long time coming back to the market. Well, M&A hasn’t come
back, retail commission volume is still very weak. Is it perception, or is it
fundamental reality that makes the market move? The XBD is at a six-month, very
extended zone starting from 490 to 520 and prone to some air pockets to the
downside.
Have a good trading day.
Kevin Haggerty
PS
Spend a full weekend with me June 20-22.Â
Click here for details.
Â