Holding Pattern
No
change in the timing models this week, so we are still in a
a holding pattern until we see a change in the market environment.
Some positive notes could be said about the global markets—Japan’s
Vice Finance Minister Kuroda once again reiterated that the Yen was
too strong and will take appropriate action if needed.
The dollar gained some
strength as eyes are on the European Central Bank’s meeting scheduled
for Thursday. Speculation is that the ECB will cut rates at this
meeting although they have been very stingy on the rate cuts. So
continue to trade cautiously and always use protective stops on every
trade.
Global Imaging Solutions (GISX)
which was mentioned Friday, broke out to a new high on good volume.
Fidelity National Financial
(FNF)
is forming a sloppy handle to go with its multi-week base. Although
the financial sector continues to get beat up due to fear that the Fed
is nearing its
easing
cycle, the stock is showing some strong fundamentals and technical
strengths.
Among the Exchange Traded
Funds, the B2B Internet HOLDRs (BHH)
gained 3.7%.
The iShares DJ U.S. Internet
Trust (IYV)
gained 2.3%.
And the Internet
Infrastructure HOLDRs (IIH)
tacked on 1.1% as it looks poised to test its 20 period moving
average.
On the downside, the Dow
Jones U.S. Tele Sector (IYZ)
continues to get beaten down, losing 1.1%.
The Regional Bank HOLDRs
(RKH)
breached its 50 day moving average as it closed lower 1.3%. The fund
has found support at its lower channel just above the 20 period moving
average. The fund closed weak just on the lower channel, it appears
that it has the potential to breach this support level.
The WEBS-Hong Kong Benchmark
(EWH)
slid 2.3%.
Remember that all securities
are risky. In any trade, you should always reduce your risk by
adjusting position size and placing open protective stops where
you will sell your long or cover your short in case the market turns
against you. For an introduction to combining price stops with
position sizing, see Loren’s lesson, Risky
Business.
Greg