Roller coaster...

...this is no walk in the park!..lol...once you're on a ride, it's not a 2 minute ride...this was a 6.5 hr marathon ride on Monday that vibrates and leaves you numb at times for an explanation as to what the hell is going on!.  This market has such a case of anxiety it's quite humurous at times. How else can you explain these intraday bounces of down 180DJIA /40 NASD and then bouncing off lows and then retrace back just when you think we'd finish a nice shade of green?.  Almost and incredibly seemingly off radar to the market was INTC guidance up.  Since when does a tech power house's news of this sort peeter out so fast.  Maybe this market needs a night to think this over and come back and do it right.  Simply, what we mean is this shouldn't be overlooked and forgotten.  Okay..back to the rides....

VMW, this was one ride that was straight up!.  Hopefully, we have overplayed this on the Journal so that that the majority of you were entertained.  We've definitely said enough of the prospects short and long term for this puppy to have it as a primary trading opportunity in this market.  Basically, it didn't go to those lame summer parties that dressed up like rallies and waited till September to kick it in by itself as we proposed.  Now, if we can get the tech sector to build off INTC news, we might just finally get it participating with the group.  At end of day, the daily chart looks like one of those explosive micro cap EPS stocks that we would be all over if it was in the $7's or 17's.  This would definitely get big attention heading into Tuesdays trading if it was a cheapie, unfortunately its in the $70's with a much bigger float.  Still, this chart that was painted might get VMW some new money coming in to play.

LDK, this one has definitely taken over leadership from FSLR as far as we've been concerned.  The deals have added up and the dressing was a deal to pay FLR 1bln to make those deals come to fruition.  We said Friday before the open this might turn into a positive spin and it definitely has as its gone from 52 to a touch of 59's in a couple trading days.  Receiving contracts is great for a potential stock move, we tried to point out it is also very good when you dish out the cash to someone else.  This is overlooked many times and every circumstance is different, but in this sector it gives these up and coming Solars credibility and therefore should be spun into a positive.  This stock seems to roll out some of the best looking set ups week after and after yesterdays NCH it looks to have again.  NCH.

WX,  this one has quieted down since the earnings up and downs and might have another storm up in the very near future, so we are watching closely for an opportunity to re-enter in a sizeable way. 

EJ,  hard one to figure out, it might be just a few sellers that are making it such.   So, when they disappear this might be a smoother one to ride. At this time it clings around its late August break out levels and 9ema that seems to giving it support. Once the trend changes it could be a pretty quick ride up, stay tuned in.

JASO ARTC TBSI  ...fill out the top of the trading list into Tues.

..Subdued

...if you ask us,  it is a little to early for the market to become subdued and not take positions before Sept 18 and Fed reserve day.   But, subdued is what we had yesterday, Sept 12th, as no one wants to show their hand..long or short.    For us traders, 4-5 days of this would be a lifetime if this continues into next weeks meeting. lol.    Now the Fed officials become mum as is customary for a week before the committee meeting, so don't expect any clues coming the markets way from that direction.  So, let the talking heads games oficially begin!.  A lack of direction for stocks till the FOMC might be just what we have to live with...oh well...  So, what we have is the probable we touched on yesterday...the dwindling promise of any good set ups possibly leading to new highs in the short term..    Yesterday, we had some early gains in our closely followed and a few stocks looked as if they might be setting up for breakouts.   Unfortunately, there is not a line up at the gas pumps and many a potential play begin to fizzle out.  The potential for false breakouts is magnified now and unless you see a flurry of buying on nice volume intraday, it is best to maybe hold off on the chase unless you want to scalp.  This type of activity is also why we prefer to do our buying late in the session as we see if the stock in question will at least hold the break and finish at or near highs of day.    This is no confirmation for follow through if volume was not there, but at least it puts the stock on radar for those perusing the new 52 week high lists when they sit with their drink(s) in the evening.

Some stocks that looked promising intraday and fell into that category were MR, GLDN, to a lesser extent EJ, GRMN. 

A possible theme emerging in our bored minds, even if it this play really never left  is the potential for DJIM foreign stocks.   Primarily, the Chinese and Russian telcos because some might be seeing the US' slowing economy and a faster global economy as a reason to get into foreign stocks.  This fact is just clearer now after Fridays employment figs and some might see it as a way out.   Of course , it is not that easy, the large caps  have more business outside of the U.S ... small caps sales is usually 1/2 that of what it is to the large caps.  So, if we do start see this trend emerge further, you'd better get the pie chart out to see where and how much business it does globally. 

MR, looking the best of the lot gave it a good shot before faltering after 2pm.  The volume was constant throughout the day and finished with a nice 1mln day. Still..it showed it wants to move to higher and if the market ducks line up better, we should see higher days ahead. The close might have been just an opportunity to add, especially if we get a good indication from the Asian mkts before the open.

ROS, for those with us since the beginning remember this one we grouped with the GLDN, VIP plays that were emerging back then.  This one enjoyed as much success since and recently picked some stake in GLDN.  This is one stock that held on late and finished with a NCH.  Couldn't ignore a position late in the chart and foreign angle.

EJ, definitely not for the faint at heart at this point.   It continues to move off the 9ema and yesterday looked as if it had the potential to move like it did in early September from 19.50-70ish level break we had looked for.  Because it is at this level again, it becomes interesting as a repeat play.  Volume will dictate this ones short term potential.

..Too close to call..

..25bps or 50bps?...How cares now..!.  Let's just get this over with and move on!.    Last Tuesday, we put a cautionary spin on the DJIM players and therefore the market.  This has turned completely into a lack of set ups and muted action in those players.  Just look at the Russell 2000. Last Tuesday's close was 782, yesterday 775 and nothing more than a 15pts range within this time frame to trade.   You can't do much with that as far as trading opportunities go.   We'd rather have the credit crunch back in the news and trade those small banks on the LSE the past few days than sit through more of this grinding action.    So, that's why we say, let's just get this FOMC over and take it from there.....it might be a case of double or nothing, or doubling up or not  on the bps cut and 50% of the experts who have put money to work..on the line are not going to be happy.   This decision is far reaching as its going to make a significant difference to all the markets from equity to currency.    We've taken a different approach and that is not bet on either and be positioned very thinly as far as dollars invested heading into the afternoon.    Just don't do 25bps today and say ..th-th-th-th- that's all, folks!.    This looney tune from the Fed would send the market tumbling.    It's the accompanying statement that will play a the vital role as we want to hear they will be ready to do more.   So, that is the afternoon, but let's not forget the very crucial morning as the report from LEH kicks off the big banks reporting season.   This might leave this market stained for the FOMC decision if they didn't find a way to fudge the book with BS MS GS that follow this week.  Traders / investors will scrutinise these results from head to toe.  

..as far as individual plays yesterday of interest....

BIDU was definitely the one and really only that was of interest yesterday for us and traders in the momentum space.  Unfortunately, as always BIDU to us is a day trading stock and really not fitting to most of our subscriber base. The price also dictates that many are not going to dish out the bucks to make this a worthwhile trade on most days, so we tend to leave it off the board here.

EJ, last week we said 'volume' will dictate if its worth a further trade.   Yesterday, the initiations started for this recent Chinese real estate IPO and it got the volume going.  CIBC with a $25 and Lazard with a $23.  There were also some huge trades in this at 20 even, so there might be some protection from the usual volatility, especially to the downside.   A possible spin that we are trading now is that the lead book runners of the IPO will initiate in the next couple days, maybe Tuesday...Merrill Lynch, a tier 1 being one of them.

ROS,  last week we alerted this Russian telco again.   It's slow, which might be the best medicine the past week. Yesterday in the afternoon it got highlighted by Briefingcom....New High Profiles: OAO Rostelecom(ROS) .....is sitting just below its all-time high of 61.55 set last Thursday after edging above the top of its Jul-Sep range.........it is difficult to pinpoint a single event that has acted as the catalyst for the shares. However, we note ....recently reported impressive financial results,  FY06 results on 7/19 in which the co posted a 49% YoY increase in net profit and a 50% increase in revs....Deutsche Bank recently commented (8/30) that Russian operators are continuing to benefit from growing usage and a benign pricing environment, after VIP reported strong Q2 results on 8/30...

CMED, SIMC  are a few names played here before making new highs intraday without faltering by close.

.6 .6 .6%

Guess we should take those % gains from the DJIA/SPX/NASD yesterday as a sign from the devil that we are going to have a down day to follow.  It wouldn't be a surprise, but on the other hand that is what most expected yesterday and we just didn't get it.   The herd was playing catch up and the profit taking didn't hit till quite late in the day.  By this time, we were sitting pretty as we had done as promised before the open and that is, " we will be selling lots and lots of yesterdays buys before catching our breath and possibly repositioning".   The good thing about yesterday is the morning catch up lasted longer than anticipated and it gave ample time to sell and get a price.  The repositioning of the sells really didn't happen as the market slid too late in the day giving the impression a little more selling might continue into today.   So why reload at that stage, is our thinking.  Still, there were some stocks worthy of intraday plays and others worth holding to see what's further up possibly.  Also, instead of adding to stocks recently talked or alerted to the day before like the GS that went to a morning high of $207, EXM mid 48's, DRYS almost 76, BIDU almost 285, TNH to 123 which we sold in the morning...we went went after a MR late in the game because it was making another new charge to highs and because the Chinese stocks is one area that held up the best during the day.....

EJ, is one we keep on holding. Yesterday, we noted possible accumulation. This was even more evident as this one churned and rolled all day in even another tight range.  Either this a forward to ML's initiation or something else, or its just a fine piece of China making a dandy cup and handle.  This is not trading as before when volatility was huge, don't ever forget those days. A shakedown is always possible and don't all get shaky knees if it comes.   We've had a nice week and considering Chinese stocks are holding their own, like JRJC, MR its worth some more time.  As said before, we added back MR and as far as JRJC, we are only flipping it here and there.

LULU, MELI, and even WX, interestingly the recent IPO's had very nice days, actually some of the best out there and we have put these on our potential trading list.  MELI, is a new name here.  It got initiated yesterday and is of the foreign AMZN, EBAY biz nature.

GS, as a follow up to possibly hold a portion into earnings. We got a very nice price/ gain and after MS's report, we'd prefer to stay out and play it in the morning if they announce nicely.  For markets sake , we hope its great and so we can live with any points we might miss.

ICOC,  we'd just like to point out the concept here has always been playing the possibility of "IBD100 inclusion".  The main idea is finding and getting to them early and going big early into the $15 level late in the week.  Remember NGA, GTI, IDSA even SYX???.  If not go back to April, use search and see the prices we started and read up on the strategy.    So, if a stock is already at $15+ on a Wednesday, it really offers us little incentive at that price.   Also, do consider that a $15 stock with a beautiful run has been drummed around and pushed by either other stock forums, hedgies...or whatever and if they use the strategy as us in the NGA, GTI plays, guess what they might be doing here?.  Well, at least we would be dumping to newbies after getting 1-2-3-4-5 pts. We'll watch for now and if we get a nice dip we might add ..anyways, we'll see how it trades these last 2 days and deal with it hour by hour.

At this point, even if we didn't reload our sells late in the day, we'd look back to these names as soon as we see the buying of pullbacks starts in the market.  And it will as any dump will be seen as a buying opportunity for those who missed this move and think this market will be going higher in the days, weeks and months ahead.  Buying the dips in this market will again occur.

Petro-Currency

Growing up and then trading from Canada,  we'd never think we'd see the day the CDN$ reaching parity with US$....guess, they waited for us to be nice and far away for the historic day!..lol...OK...now back to the US markets we trade, a market we've had to greatly outpace just to deal with the greatly appreciating CDN$ over the last 6-12 mths.   Luckily our goal at DJIM is not to produce paltry returns in the single digits or the teens'. Anyway back to the pitch as the futball fans know it as ......living 3 minutes away from the Chelsea pitch on afternoon game day is quite the experience for any sports nut...or drinker!!

So...yesterday was hardly unexpected after the sprint we've had this week, the valiant effort of many to keep it where it was most of day was good to see.   Somewhat surprising was to see dip buying come in so early at times.    It would be a victory of sorts if we could end week basically unscathed without a serious short correction with the loss of momentum.   Despite the small caps, mid caps indices leading the way down in the afternoon, we were pretty well and running from the morning with our niche of players we had you following and hopefully trading.

MELI, LULU, WX, the trio we gave before the open outperformed anything and everything off the bat.   MELI steamed from the 33's to 38 and considering the force of the move maintained its lofty intraday perch and closed at 37 and change.  After 2 days of action, we know this is on radar now for those into a little action.    LULU and WX sprinted to new highs as well from the open.   If some of you want to trade broken down stocks and patiently wait and wait for the all mighty bounce....the best to you, but as part of the DJIM methodology says... look for the strong,52 week highs, which at more times than not is the easy play!.    These 3 had all these colors after their strong showing we pointed out in a market that was treading water the day before.  Wondering if Cramer put on some Yoga gear to demonstrate his bull-ishness on LULU last night..maybe a LULU thong or the LULU Hot shorts!.   Sorry to make you sick in the morning...

EJ,  we think we have walked you through this trade in the past week or so.   As we've been saying the accumulation is most likely a forward to Merrill Lynch's initiation of the stock.    In many a traders eye, the play could be over in terms of they got what they wanted this week and moved on.    The 22 level was a no a technical no brainer and was an exit door for some.   This is the one reason one should use charts, to use them as a guide to where you might find resistance or support for your stock.    The Merrill Lynch initiation will come today, we hope its enough to fuel this some more and at least get it on radar of more money.     Don't expect anything to send this to the moon though.   Just like pre-earnings runs, this might have been a pre-coverage run led by those in the know...we'll see shortly depending on the $ tgt ...if they give one.

APOG,   this one we bought into and as usual with it maybe a little early at 26, as it did its traditional yo-yo action on day of a good report. Every Q this one seems to beat and we were waiting for the exact action we saw later as this moved from 25' to high 27's intraday and finished strong.  The potential in this stock short term is in the charts. You can easily see the last two reports on gaps and then the follow through to higher ground.    Not sure why this got so beat up during the summer and frankly don't care after these earnings.    ----------------                Reports Q2 (Aug) earnings of $0.40 per share, $0.04 better than the Reuters Estimates consensus of $0.36; revenues rose 19.7% year/year to $217.7 mln vs the $209.1 mln consensus. Co raises EPS guidance for FY08, sees EPS of $1.43-1.53 vs. $1.50 consensus, up from $1.37-1.47; raises FY08 revs guidance; co sees revs growth of 11-13%, which equates to ~$887.1-903.8 mln vs. $877.17 mln consensus, up from revs growth of 10-13%, which equates to $879.1-903.1 mln. Co says, "We remain optimistic about our businesses and markets served, and are positioned to meet our longer-term objectives of 8% annual revenue growth and 20% average earnings growth through FY10. Our solid year-to-date earnings along with our strong backlog, commitments and bidding activity give us confidence in our ability to grow revenues and earnings through FY10.

LWAY, the chart was getting our attention the day before and the open, even on light volume showed us some potential....simple as that.  A nice move ensued and volume was pretty good on the day.   Hopefully, the chart came to a few more overnight and we will have some follow through action today.

LDK JASO MR ANIK ICOC GS ,   top out our trading list for Friday.

a bunch of Yo- Yo's

Before yesterday's trading day,  we noted we'd be trading hour by hour, not a bad idea it seems as what we have is a bunch of yo-yo's day to day..hour to hour.  You almost have to make a choice of whether to hold these through the slips or just daytrade the heck out of them.  Unfortunately the 5-10% down days make it hard to hold till the next day and the daytrading mode might not be for you to capitalize when they pop in the other direction.  We've never been ones to daytrade these stocks, getting in and out of them on a daily basis was not the way we played them to these lofty perches they are sitting on.    Simply at this time, this is seemingly what you have to do with the DRYS EXM LDK GRMN FSLR JASO stocks or just hold through the volatile action and take some lumps on off days.   On any given day you are getting 5,6,7, 8 pt intraday trading range, with the close either at the low's or highs of that day in most instances.  One day they are tepid and lagging the overall mkt and/or red, the next day, they are flying.   Also, it is not so easy to say a stock making a NCH will continue on forward the next day.   Now, you simply don't know what the stocks we've covered this Q will do the next day.   There is only one way to explain the action and that is to understand it as a Q end phenomenon with a lot of hedgies flying in and out of these big winners of the past Q and creating this volatility.  Performance anxiety after a horrible July and August for too many of them.  Probably started padding the books with this China spec stuff and got the wildfire started.   We doubt the timing is a coincidence.   So...you have 3 choices really, one is take the lumps the bad days or even intraday moves can throw you...two...is buy and sell the same day ...or three...which is stay out completely to avoid the stresses of it all and await a calmer trading environment.   There is no reason to point out plays reaching NCH's Thursday,  you're most likely rolling the dice with most DJIM plays into the last trading day of the Q, even with less volatile issues like MR EJ.

Anyways..be careful today as the funky stuff will likely continue...either try get jiggy wit it on an uptrend or just stay out...

AZZ, an original DJIM play is one to possibly trade off today following earnings. $36 premkt.

Bulls on 'roids and Pigs can fly..!.

Those seem to be facts now!.   This is what we saw yesterday as the Chinese bulls roared off the Asian markets, even when left at home alone with the SHANG on holiday's.    With every Bull shot there is a pig in it's footsteps.   Meaning speculation on junk ones was wild and you need to be careful at this probable late stage in the game.    Back at the ranch, the market was doing better than expected with not a lot of profit taking.   We added this footnote to a post before noon,  "Considering yesterdays action this hasn't been bad at all or meager for the small caps /RUT been green most of the day. Bunch of those sorts here having good days WX EJ BIDU JRJC LULU MELI ROS GLDN FSLR EXM TBSI..AZZ might still " .    The day turned from good to very good late in the session for these stocks and a few others like GS, VMW, CSCT.    The market continued to trade sideways and finished mixed, yet for consecutive days now, we were in the right place at the right time.     Hopefully, our morning Journal steered you back home if you've strayed!.     This was the true Bull shot of the day, the DJIM index.    There is really not much to say heading into today trading, except that hopefully we all played these shooters smart and took some off the table.    This is especially true with the gains generated by the Chinese stocks covered here.    Even the good ones will get nosebleeds.

A member noted and what is probably a good way to understand the Journal is to see it as us thinking 'out load'.  One thing is to shadow plays, another is to shadow our mindset, which is probably the better way to go.     We can't give buy/ sell advice, all we could do is show what we are buying and thinking.    Hopefully, it rubs off on you and improves your trading ways.    When we noted yesterday.."Now, we just ask WX to get some game and it will have our most recent China plays on even ground. Oh yeah..where was BIDU yesterday?.     Lets no forget this rocket ship when looking for a good intraday trade.".    You need to ask yourself why are we even mentioning these two that under performed the day before.    Simply, we are thinking ahead and with a big overnight Asian market these just might come out and play with the rest of the kids.   Trading is so much a psyche game, you need to think ahead and think what others will or might do.   Your gig is to get there in the early stage or even ahead of the herd.   We gave the below leads yesterday, clues into where we might be leaning and why.  All you needed was one or two to have an excellent day.  The language is simple and we'd all should have been prepared..

TBSI got back in the hunt and is close to highs.

VMW, we don't cover much tech, but VMW has been the one we have traded the most.   Finally..this one is acting with the sector

which is leading the recent parade and not playing on its own terms. $90+ is in reach now

ROS, GLDN our Russian telco plays are not be forgotten as long as they cling to highs and therefore offer more upside potential in the near future.

WX and BIDU( wasn't all JPM initiation), it was a matter if you build it, they will come!.   The build up was the overnight markets and these were prime candidates to play in the mud with the others.    Anyways, yesterday was a day for us to daytrade these high flying Chinese stocks and it occupied most of our day.    Now, we need to get back to basics and deal with reality and concentrate on the others like GS, FSLR, VMW, AZZ etc.  The EPS winners and ones to come and the potential set ups that we can all get in early on. 

We all need to be a realistic after two days of solid gains!

...in front of the Fed

Not surprising to see some profit taking in front of the FED yesterday, especially after a 6 day rebound from Oct 22 lows.   A surprise to some maybe was the late round of selling led by the "dry bulk rate", Chinese games taking down the momentum shipping group hard in the last hour or so.  A few other groups caught the coattails of the dump and sold off as well.   In reality, this was a non-event and all eyes and ears will be on the 2:15pm decision.  This was not a true reflection or a hint of what may come today.  

As far as the shippers, we haven't covered this group on the daily Journal since mid October, ..."This story ain't going away heading into the New Year as we've noted before, but after this latest binge momo run we are more cautious and prefer a pullback to go with a worthy position overnight.   Lets just say, we liked a TBSI more at $50 recently than at $60 now.".    Well.. we haven't missed much action since those words, except one sell off and rebound and now we definitely got a big pullback, but it is too early to say we are looking for an entry back into this group.    This group story isn't going away unless the Chinese don't need ships (if that's the case everything on the market is in trouble).  These are cat and mouse games to get rates down and it is something worth watching now if you are thinking of going long for more than a intra day trade.   When selling hits, it is always best to rid yourself of the stock and ask questions later such as to the reasoning.  You have some political games here now and you need to keep updated.    We don't have the time and will only react when the coast is clear.    Many firms recently raised this groups price targets and will be going on the defensive tomorrow, a bounce here and there should happen.      Nothing could have been more dangerous than trying to find a place to park your money as this group started to sink, looking for an entry and not knowing what is the cause is praying for some blind luck.  Just in the last 30 minutes EXM fell another 7 after giving up that much already.   The 9ema short term was crushed here and it is a second pullback late in the month, this one more extreme.    Hopefully, our constant warnings of this possibility hit home as this group was having yet another binge recently, included was the information given that their are large amounts of hedgies playing a derivative market here in this group.  A dangerous combination,  just waiting to Titanic.  This ain't no Mom and Pop selling yesterday, this was led and taken apart by the bigger money......We`ll let this cool off..

We are about to get a load of EPS reports from recent DJIM names in the next few days. (see earnings link).   Hopefully with a favourable FED reaction and some nice earning we can continue to go forward off this latest bounce.    There is really no use discussing what could be strong in the morning based on Tuesdays action as so much is riding on the reaction in the afternoon.    But a few notables yesterday heading into the morning trade are CETV into earning , EJ YGE BIDU were the Chinese stars on Tuesday and AAPL fit in with the tech sec having a good day.  A few remain near highs like SPWR should remain in play as well.    One thing to possibly watch for in the upcoming days is where is the momentum money flushed out of the shipping group is going to go.  It might sit on the sidelines if the FED reaction is muted or terrible, but if its not,  we'd closely watch the other momo groups such as the Chinese, Solars, IPO's to start with.

...CUTS like a knife

..now it cuts like a knife-- yeah
but it feels so right..
Oh now it cuts like a knife..
Yeah..but it feels so right...Yeeah..

Now we truly know what our fellow Canuck was singing about !.  It was about consecutive rate cuts from the Fed down under.   Yesterday.. the shorts were squealing and the longs were singing as the market squeezed the shorts lights out.   You can read all about it and you will hear all about the ramifications of the Fed cut....let the spin begin.... but we've got people to see.....things to do....most importantly stocks to trade!. We are now done with October and are on to November, which is always a much better month of trading as we lead in years end.  Historically, consecutive rate hikes are liked very much by the markets, it seems the market forgot that for a few minutes yesterday before getting its memory back and started to look forward........So, let's get on to some new names emerging from earnings that we are monitoring and/or trading ...

MA,  this was on all screens premkt yesterday as it traded off an excellent report.  If you've been here for awhile you remember MA well and had its earnings day circled..well we try to circle as many as we can for you on our earning dates page.  The company said any softness US side will be "cushioned' by Global growth.  This was the same song from previous Q's and this idea has always worked well for MA's stock price. If you didn't get a position yesterday, you might want to wait for a pullback, a pullback on a downgrade based on valuation (you always get these after a fast trip up) and make this a quality holding.   Reports Q3 (Sep) earnings of $1.80 per share, excluding $0.51 from the partial sale of the co's investment in Redecard S.A. in Brazil, $0.38 better than the Reuters Estimates consensus of $1.42; revenues rose 20.1% year/year to $1.08 bln vs the $1.03 bln consensus.

PSEM,SIMO,SIRF,MICC.. have you noticed the reaction of some earnings the barely beat or giving in line guidance moving nicely (PSEM SIMO).   Well, if you didn't we're telling you now!.     Simply, we haven't seen such action in a long time and this is a good thing as we will have more opportunities to trade.     It looks like we won't need a big EPS headline to get a stock moving this Q.   We've bunched these 4 to watchlist..you must have 4 lags you can move a screen back and replace with these.    We'll do some homework on these over the weekend and if you see the names here into next week....well then you know it should be on your primary screener this Q.    MICC is a foreign telecom/cellular name you may remember from DJIM when we were trading it as a takeover play with a few like China Mobile interested.  Anything foreign with its foot in a growth business is good with DJIM.

STV, LFT...as we scratch our heads, we come up with ideas it seems.;).  The action in these two has been surprising in one sense, but that is only if you are thinking the past here and expecting momentum to be here on a daily basis.  Yesterday, we had interesting action in some China names early, the FXI was heading to recent highs, the China energy plays were moving nicely and seemingly there was one thing missing in this scene and that was the participation of these two  IPO names.   What reaffirmed our long term and even short term view of these IPO's is that they behaved so well as the market tanked after the Fed decision as we noted.   Well, we all know what happened after as these spiked so nicely.   If you're in for the long term this should give you confidence, if you're short term you now know the power and speed these have and had yourself an easy in and out trade.   STV has been ranging nicely and there was powers at work eating up the $38.00 giving it even more support.   We hope this move is the start of these getting back on radar of momentum traders.   Also YTEC's chart is coming together, so a closer eye should be kept on it.  EJ another new high.

CYNO, GTI ,  past DJIM plays out with earning this morning to watchlist.

...same old stuff

well that's what it feels like...when you have no patience like us, especially after the early week snapback rally.  Now, it seems its the same old as late day fades rule, yesterdays a bit earlier than the previous and then a battle at around 1450 on the SPX with buyers stepping up to close it above this line.  Indecision is running on both sides (but the shorts may be more nervous), maybe it is plain exhaustion and we all just need the weekend to get here quick and some headlines to give this market a course for the short term.  Still, yesterday was not without what's important to all of us and that is there were a few names off DJIM Journal that were making some noise...

MELI, seems a few agreed with us and came to play as MELI got pushed 5.5pts from lows to highs of day.  Earnings reaction are not always a first day thing as MELI showed yesterday.   Now with it showing up on a very THIN new highs list across the market, especially those tracking NCH's, we'd hope the idle money comes here to spend some time.

QSC, the other day this had a big buyer eating up shares at $4 even, millions of dollars worth, sooner than later this was pushed to the high 4's as such action seemingly always does.  Yesterday's pullback might be sufficient, a plus is it was on fairly light volume. 7mln to 10 to 11 to 3mln volume.   If this was a quick flash in the pan, you'd think we'd have more selling yesterday.  Anyways, this regained the $4+ level and closed at the highs of the day.   A quick volume move might be in store in the short term, watch for that as a possible entry if not holding already.

STV, EJ.... the concentration here the past week was to use STV as a possible pre earnings mover on the heels of WX and EJ.  STV had climbed about 25% since the week started and to many that is good enough!.    So, it is not surprising profit taking was part of the equation after STV released earnings.   All stocks are different and in the case of EJ the pre earnings move translated into profit taking the day of earnings giving it some leg room to move forward on a good report as we saw last night to recent highs.   As we've noted recently regarding WX...expectations are over the top on these Chinese IPO's.   You are not going to get a surprise reaction and a fast move up like with other nice earning reports that come out of the blue and immediately push a stock higher.    These Chinese IPOS' would not be trading on the NYSE now if tremendous earnings growth YOY didn't put them there in the first place.   Great YOY numbers are expected and you could say priced in.    What these stocks need to get a big push higher right after earnings is something almost impossible unless you are a GOOG!.     What we look at instead of YOY growth is how a company performs sequentially to get a better read of how business is progressing the past few Q's.    STV's revenue came in at 14mln after 20mln for the past 2 Q's, so there is nice growth that is ongoing.    Also, things like operating margins,  in the case of STV are just not to be found in many other stocks.   What these stocks now need is the firms to possibly set a good tone in their reports, initiations in the case of STV.   As we said, we like both reports and STV might have been a bargain last night after hours at $32,33,  but it is the market the will dictate the stocks path and a firm or two the day(s) after...a good market would help too!.

No second chance...

It seems these days, the market isn't giving people much of a second chance to some of the speculative plays.    Of course, if you aren't into them, then there's really nothing to worry about.    Market opened weak but ended way higher today.   Again, we have the big techs and financial companies to thank for.   While indices seem to have a blast today, it's actually quite difficult for us to find good plays from the smallcap land.    Now only if we knew how this market would turn out, we'd have ditched all our small ones and we'd be gunning for the big ones.    Unfortunately what's happened has happened and that is something we just have to live with.

Here are some plays we are tracking/playing..

China Plays, most of the China plays did not really participate the rally with the exception of EJ.   Speaking of EJ, even though it's had a really good day but we think the run-up is a little extended at this point and we'd wait for a better entry point.    While most of the quality China plays stayed relatively unchanged, some of the speculative ones are just way more wild and did not fare that well.    Is this the end of the sector move?   We don't think so!   However, we should point out that you still have to distinguish the good quality earning related China plays from the speculative ones. VISN, is a quite cheap for an IPO, unfortunately after initial 10% run gave it up and starts from scratch.

Solar Plays, with the exception of JASO, pretty much all of them went down today.   We think it's best for them to find their footing for another day or two before taking a look at some of the setups.    There's absolutely no rush to buy them right away.  Still, note two buy ratings on SPWR/YGE this morning to stick in the overall picture.

MA/ISRG,  out of the expensive names, these two(recent eps winner) managed to not only break out, but notched a nch.    We chased some during the day and feel they are very much part of any index rally.

PSEM, this little technology company finally made a move today.   It's currently sitting right near the previous high.   It's going to be interesting to see if it can really bust out this time or not.   We got our finger on the trigger and if it does kick it up,  we'd be right there to chase some.

DJIM #49 2007

Tis the giving season and Tuesday afternoon,  we're gonna get some in the way of a FOMC rate cut.   Following Fridays data, a .25pt cut is the most likely outcome, but there are enough still in the .50pt camp.  One thing is for certain is the decision won't be unanimous as we'd all like and all eyes and ears will be fixed on the statement attached.  Unless there is a knockout grinch punch to the market in the language, we think the market will move forward and set it's course on continuing the recent rally into the holidays and New Year.   Basically,  just get this over with and lets move on the heels of last weeks bullish days as the indices finished near the weeks highs.  Last week many quality stocks continued to get out of their bases with many more bouncing off the 50MA with follow through days.   Also, recent quality earning stocks showed some life as quiet a few closely followed at DJIM broke to new highs during the week.    They include...

MA, ISRG, AAPL,  we have always preached set ups with NCH's in place or in sight.  The market started to provide these trading opportunities once again after a long lull as these leading stocks in the past regained their lofty positions.  That's the kind of action any growth investor or just any trader wants to see and trade. 

VIP, MBT, SIGM, WDC, PSEM are the other recent EPS stocks that reported very good numbers and are now being recognized and given spurts of buying leading to NCH's almost daily.   MBT and VIP have an overweight initiation out from Lehman this morning.

SOLARS, the picture was not so clear heading into Fridays trade, but as we noted there were a couple of buy upgrades on YGE and SPWR to possibly play a part ahead of the trading day.  These upgrades definitely fueled the solars up again as many had nice days, including JASO again and STP...FSLR ran up on rumors of a contract.  We've seen the firms 'lead' this sector forward before when they start with upgrades, initiations. We might have some of that starting up once again.

Our closely followed China stocks LFT, STV, WX, EJ, EDU snailed to a 2nd consecutive week of gains since we turned our focus back on them. The volatility seems to have been removed for the time being and we started to call this group of stocks a Mutual Fund as they creep slowly higher and higher.

After weeks of trying to find a decent play, the market has started to give us plays that fit our methodology, eg NCH's and we welcome it and will concentrate on the above sorts with the usual sector (solar, china, shippers) tossed in.  It is a time for all of us to look at the 52week high lists and find more names that might provide a good trade while they trade at these levels.  You will start to find many former DJIM site names thrown around in this crop of stocks as you do your nightly homework...BOOM FWLT FSTR GEF LIFC PTT RICK TXT VE WGOV etc.   You want to trade strength and get out of any bad habits you've found yourselves in trying to trade a corrective market, such as bounces etc.  This may really be the time once again,  if we clear tomorrows FOMC hurdle in one piece.

Pre Fed

Many are lead to believe that last couple of day's action is due to the anticipation of a Fed rate cut tomorrow.     We think it's a combination of many factors that are setting us up for some really good action in this month.    However, Fed is still Fed and anything they say tomorrow can have a dramatic impact on the course of this rally.      As far as we are concerned, as long as the Fed addresses the current financial environment we are in and it's willing to adjust its policy to help the market, we basically get a green light for the next few weeks.    If for some reason the market sells off the Fed news, and especially if it's some good news, we wouldn't be hesitate to buy into the dip. 

Now the playlist...

Over 90% of the stocks on our watchlist are green and we just have to be very encouraged by the market action today, but FOMC on deck!!.  We'll get into detail of some of the action here,

Solars,  this group has been on fire since the Energy bill.   If you miss the low of the group on Thursday, then Friday would've been just fine getting into some of the popular names.    Today we are getting some really good follow through on top of the good action from last Friday.   Our top favourites are now STP LDK JASO FSLR...  we are also trading SOLF CSIQ as well to throw in the mix.     

China Plays, we are actually surprised that some of the more speculative names are still holding up and showing signs of perkiness.   This leads us to believe that there's definitely more pop to come with the whole sector.    The quality ones we like had some mixed action today with STV WX outshining EJ LFT by a wide margin.     STV has a particularly nice breakout out of the recent consolidation off very good volume and we think it has potential to return to its former glory.    We are definitely trading more aggressively toward STV after today's action.   With LFT, the consolidation is still between $23.50 and $25 and it may require some more time to really break out of it clean.

EPS winners, MELI had a very nice breakout today on very healthy volume.  It notched a nch and sits well above the recent range.    We were really hoping for an intraday dip to buy some more but it just never came.   It looks like we may just have to chase it if we want to get some more of this.  SIGM MA VIP MBT continue to trade with this market.   One thing we have to remind people that the eps winners do trade in a rational manner so the further away they move from 9 ema, the more likely that they'd stall and pullback.    We simply have to be a little patient with the eps winners and have a bit longer term perspective.     

The bottom line, this market still feels unconvinced for a rally and many people are still underinvested.   Alot of negative news are being absorbed by this market recently and all these are all considered bullish sign.    We have LEH releasing earning this Thursday and that may give us a clue of how the financial world will react, which is very important to gauge the market sentiment.