DJIM #22 2008
Over the weekend it seems many were saying the 4 day shortened trading week was much ado about nothing with not many stocks to chase. That's true if you are judging this market by the DJIA. Here, we are not as the concentration on commodity stocks continued with two big days sandwiching one not so. That's fine as it presents the chance to recycle your favorites over and over again. Also, quiet important was that the market was mending itself after the previous weeks fall. We said be patient and let things settle down heading into last weeks trading and that is just what we got. The healing process is most evident in the IWM as it seems to have confirmed its breakout over 73 after a test. We also had the NDX confirming the earlier breakout over 2000 by putting in a nice week. It's clear from these broad indexes there is a big game going on between Oil vs. Tech.
Heading into this week the playground for DJIM remains the same. The only differences to note week to week now is which commodity sector is best to trade at that particular time. Example of this is just as we were once again becoming cautious on the Solars important subsidy news surfaced out of Germany premarket on Friday which made solars gap up at the open. If this news comes too fruition, we will have all the time in the world to chase these stocks over the next Q as the news is quite significant. One thing we wont do and didn't do is chase the gap open we saw on Friday, instead we are just moving up this sector up our trading ladder and we'll keep a closer eye on the stocks here. We'll keep saying.." Out of all the commodity groups, coals are still showing the best technical with steels a distant second". The amazing streak in the coals continued with DJIM's bushel of ANR, PCX and FDG making new highs on Friday. MS has put ANR on overweight and FBR has put PCX as a top pick at their firm this morning while raising estimates on the whole sector. We can only ask what took you boys so long?. Always better to be early to a stock party isn't it or be stuck scratching your head if PCX is now too expensive at $108. It was profiled here April 15th in the low 60's.
Really nothing has changed about what we'll most likely continue to trade, hell why would we!. Until, we'll just pluck at a few new plays here and there as they emerge like on Friday with PVA, which even after a gap open managed to pull off about 4 pts after our alert. We simply liked the idea off going back to the 'WELL' after our CLR play and just waited for the right time to alert. If you want to get into the tech fever, we think the only stocks you need to trade are the RIMM, AAPL, BIDU, SOHU, GOOG. If you want a few DJIA stocks, there is nothing wrong with concentrating on V, MA. It's all there on the Shadowlist simplifying what we should be looking to trade depending on what area of the market is moving. Have a good week!
**NOTE- We added a direct link to the DJIM Shadowlist on the navigation column that you may enjoy. Scrolling over names allows you access more info and you can change all charts to daily just above the first 3 charts. We will update every week or two, until use new names from Alert, Journal to add until.