Better to wait than act..

Index wise, there was less drama today than yesterday.   We are guessing that the market is still trying to recover from last Friday's mind boggling point decline.   This is where we got to pick our spots carefully.   The action overseas, first of all, was just downright ugly.    Normally, we'd say that it should not have a huge impact to us here, but we still have to be mindful to avoid some of the plays that get affected.    The plays we'd avoid right now include SOHU, BIDU and any other Asian companies that are on our shadowlist.    It's really not that these companies are bad, it's just the fact that we are concerned that the overseas action can and will eventually spill over to any and all of those companies that do business there.  Just putting it out there.   Basically, we'd rather be safe than sorry.

Commodities, this is the area where it gets interesting.    Yes, we noted that the CRX may get beaten up today,  some sectors like Steel and Ships just got hammered.     On the other hand, coals and agri/chem seemed to be holding well along with a couple of oil plays.    We are trying to be selective these days while not rushing into buying things eagerly even on dips.    As we pointed out yesterday, while some stocks will appear to be bottoming on an intraday action from time to time, we'd prefer to wait for confirmation before acting with purchases.     Trying to catch the absolute bottom, regardless the quality of the stock, can be risky at times.    So instead, we try to catch the relative bottom after we see signs of a turn.

Out of many plays on our shadowlist, we are going to highlight a couple of plays out. RIMM as popular as this one sounds, it feels like this one is putting a turn in place.   Of course, this isn't a commodity play so you probably won't get daily gains like as in a coal play.    However, by pointing out a probable outcome, even a few points in the current market condition from a tech stock is not a bad thing.    We do like the liquidity factor of RIMM though.    IPHS, perhaps it's catching some fever from MOS run-up but we feel it may be more than that.    There's simply still not enough coverage from this stock and not many traders know about it yet.   Based on the trading last few days, we still think it's in the accumulation phase, despite the fact it's at the 52 week high.   We like this one.    Coal plays, ANR  PCX  MEE  JRCC are the top dogs in that area and this is probably still the strongest commodity group as of this moment with Agi-Chem coming in hard from the back.    If you recall one of our journals a few weeks ago,  we felt coal is the commodity sector with the safest upside and even more recently said the Agi- Chem may be the next group to go.    The coal group is exhibiting pausing action with analysts taking turns upgrading the sector.    At this point, we don't know how much further upside it has left but we always believe market will over exaggerate even the wildest expectation.    The two sectors that are seeing serious trouble are solars and ships.    With Solars, technicals just look terrible and many stocks broke down from the recent support and we aren't even going to bother waiting for a turn until some sector specific news that can boost up the action.    With Shippers, we aren't going to ask questions at this point and will just leave them be.    

Bottom line, everything we said happened, the $CRX fell 30 pts high to low, the market(DJIA) had a fade opportunity as it climbed 170pts intraday...You could have saved money, you could have made money.  We did neither really due to little exposure and because we want confirmation here and there.   This is the time we have to focus on the obvious, and more so than in the past.   Market is going through a lot of turmoil right now and the only visibility we have with us is with the commodity plays.