DJIM #15 2007

A premise here has been our belief that the markets will be solid going into another earning season, a market has little chance of crashing through the floor before the companies get a chance to tell their side of the story. The correction has been literally wiped away and the recent retracement to the 100ma averages has seen a healthy bounce as we enter Q2.  Last week was one for the books as a number of plays here enjoyed breakaway gains..WBD, JSDA, GROW, MFW.  Isn't interesting that these are all earning plays at one time or another on DJIM. We also had nice moves from AMAG,OYOG.  Plus the solars TSL,ASTI, FSLR..we talked about last weekend as a possibility for the week made for some nice trades.  Sometimes the strong get stronger and it is more apparent in a bullish trend such as we enjoyed last week.  Simply, this was a case of recycling which is a big part of our trading methodology. Speaking of recycling, a few names popped back into our books here on Thursday and they include DJIM stocks from January in MTRX and USAP, both previous earning gem winners.

We'll concentrate on Thursday additions...

MTRX, announce an excellent Q with an upside to guidance. Last Q this was pick up at 16+ and was as steady as they come. Not a big flyer it survived every pit the market would throw at it, including a sliding Oil price and it still held ground. We expected MTRX to trade as the previous earning day, but it performed much better than expected as the institutions did not churn it as before. The guidance was the key this time around as it put on gains throughout the day finishing strong.

...beats by $0.07, issues upside guidance (21.41 ) : Reports Q3 (Feb) earnings of $0.24 per share, $0.07 better than the Reuters Estimates consensus of $0.17; revenues rose 41.1% year/year to $168.7 mln vs the $136.5 mln consensus. Co issues upside guidance for FY07, sees FY07 revs of $630-640 mln, up from previous guidance of $560-580 mln, vs. $588.92 mln consensus.  CEO says, "Our third quarter performance significantly exceeded our expectations as we were able to add to our strong talent pools in the construction services groups allowing us to capture and execute more projects, particularly in the Downstream Petroleum Industry."

USAP, a darling from last Q with first buy in at 36+. This maker of speciality steel products including Aerospace and power industries is in the right space at the right time.  We think it is just a matter of hours before we see USAP take on the February highs of 51.80 and go forward and so we added it back. FWIW...Cramer was bullish on his lighting bolt seg March 7th as well.

SPEC, this one gapped off earning March 30th, ( Q1 EPS of $0.16 vs $0.02 in yr ago period; revs $32.9 mln vs $25.6 mln in yr ago period ). Sequentially, this was in line with Q4EPS and with 99 94 IBD numbers it is seeking $15 from the IBD crowd.

Speaking of IBD... How about SYNL and EML, #13 and #85 this weekend for these two DJIM finds from 2006 and last Q. Guess they added their volume together to stick them finally on IBD100.  A note about EML, Friday there was a note on Dept of Defense new armoured vehicle program. Big contracts will come in 07 as this program expands and AH(Armor Holding) gets EML do quite a bit of the work. 

TNH, Terra Nitrogen (nitrogen fertilizer products). 93c Q announced in February. It has been a great trade for sometime due to its volatility. It is one to be traded with care. We added on the dip Thursday and it recovered and flirted with new day highs by close. Made a NCH on a very good volume day(top 5 this year). Guess this is a Ag play as it grows what we eat,  but it is tied to the price of natural gas, it is more than 60% of its expenses. So know what's going on in that end.

As great as the recycling program can be, it does not stop us from looking forward and having cash available to go strong after a new batch of earning plays. We have a growing play list after last week, but we think the bigger money can be made in new picks coming up and so enter this Q with plenty of cash on hand.  Also, if we were holding any laggards at this point, we would simply dump here and avoid waiting for a sunny day with anything stalled and just free up more cash to use on new plays.

If you need reminding, here is a list of some of the stocks we traded here last Q off earning... USAP CCF VTRU VARI MTRX SYNL EML HDNG CYNO TRT HURC TRCR TGX NWK AVZA CSV.   Get it?  Opportunities will be there!

It starts with RIMM and VIP this week as far as past DJIM earning plays.  If you missed it, we've talked about VIP being a play before earning on the heels of MBT report  here on the Journal. So watch it closely this week for a pre-earning reaction. A few notable Russian funds were up over 3% last week, maybe it wasn't all WBD holdings;), but a sign of things to come for DJIM Russian names.

Also, the earning dates link waits for your participation on earning dates for DJIM plays when found.

Still a victory...

Even though the score is not showing up on our watchlist, you just couldn't help feeling that the positive vibe from the overall market will eventually spill over to your stocks, at some point.    So maybe not today!   There's still tomorrow and whole earning season ahead of us.   The strength among the DJIM stock is fairly narrow today with a few outstanding ones.   Lets get to them now...

JSDA, IBD writeup + 1234 set, 9ema + NCH....  oh my this just sounds so corny. lol    Well, many of the stocks we come to known in the past often felt that way too.    With corniness comes famaliarity, and that's a good thing to us traders.    We liked this setup alot and added throughout the day, and closing is nothing short of spectacular.    Let's just keep our fingers crossed for some good action tomorrow and beyond.  THE AH action has continued to over 26.

TNH, we told you this a volatile one. Today it was almost 6% volatile ' UP' and a NCH off the 9ema it has held the previous days.  As a trader you have to love stocks that give you 4-5pts in a day and that is why we have this one up on our play list.

SILC, this one caught our attention late as it bounced off 9 ema earlier and raced toward a new high.   We added a little toward the end and are looking for follow through tomorrow. As long as SILC keeps getting design wins this one will keep getting some attention.

AMAG, action was not overwhelming premarket and we started to see some sell on the news.  We bought some back near the close as it held 70 today quite well.  Jefferies came out with a $99 to go with DeutBanks $100 price target.  We'll see what tomorrow brings before taking more action.  Considering there was only a $2.95 spread on 1.8mln shares for a small float stock...this could coil up for a nice pop.

DJIM #16 2007

The week closed on a high note for DJIM stocks as they outperformed the market in the morning. The spillover from the markets move Thursday came into our stocks early and in bunches.  As we said the night before...there's still tomorrow!

JSDA, what can you say about a trip from $23's to a AH price of $28.70?.  Well, we talked about our buying enough last week, how about thinking about some selling strategy heading into Monday's trade and perhaps a gap open.   One way to approach this runaway is if it gaps Monday use a mental stop at around Friday's close so you don't blow your winnings.  Some may give it some more room and use the open price area Friday for an exit.    If it keeps going up, you just go with the flow and keep it a hold.  There will be more trade in this and taking some off sooner than later will not hurt you.

BW, incredible what one buy rating by First Albany can do for a worthy earning DJIM stock.  Volume was nearly a million for this Friday as it opened at $54 and climbed all day to $58.  If you got your play-watch list screener set to the top recent plays at DJIM...then you had a potential 8% move on your hands.  Same goes for TSL and it's 6% move. There is only so many times or so many plays we can alert-comment on a day without confusing the lights out of our readers.   Hopefully..these are on the top of your trading play list as they are on ours.   Both put in NCH's again and we will be selling what pieces we gathered Friday into a hopeful nice open off the NCH's.  After...we will again look to buy a dip in these.

TNH, recently when we added this to DJIM, we spoke of the rewards possible if you get on the right side of a TNH trade.   Even if you plucked it off Friday after our mention Thursday night off its NCH, you had 5 points by noon.  How many stocks do you know that can get you up to 10 points the following day if you bought the day before.  $60-70!.   We'll look for another entry after selling into this fast ride .   A note, there is a relation to TRA , which made a NCH Friday, but to us TNH is the play here!.

UXG, this was definitely a sweet winner here Friday as it climbed and climbed to almost $7.  We are buying the dips here as we are in the GRZ and URZ.  These are providing nice trades off the dips over and over again of around .50c.  Once in awhile, you might get a move like UXG's which is a just a bonus.  These are our speculative bleacher creatures and we will continue to trade them.   The other cheapie around here...

CIMT is holding just fine since our $3.80's intro on it.  It seems quite safe and we are looking for another leg up soon.

If you want to get real cheap and speculative...

PAE,  came out with earning late friday.  It reported .06 vs. (-0.04) +250% EPS change,95 RS, following a break even Q with revenue over20mln+11m in the previous Q.  It closed at $1.65 and has market cap in the 50's mln. Even if you take out a 1 mln legal gift, they still made over a 1.2 mln in net and are now profitable.   Usually a stock turning the corner on profitability gets some attention sooner than later.  It actually got into IBD's top earning announcements column and might get a look Monday or simply crawl slowly upwards from here.   It can be a complete bore or its numbers and float and price will get some cash into.  We'll watch early, you never know...

JASO,  we tried to include this early in the solar play here, but it never materialized as the FSLR, TSL and ASTI were the clear plays.  Well..this has changed the last few days as it has gained some momentum.  It reported 'swell' earnings, March 30th and was trading at $19 when mentioned last in Alerts.  Looks like some newsletter hype job has gone into this, so trade with care if in at this point over $24 and 20% in a couple of days.  Our money is still for the FSLR TSL ASTI plays, but we will look to buy lower prices in this one most likely.  Time will tell....

ASTI,  has done a beauty of a job flying off the 9ema and closed with a NCH Friday. We are there and are looking for higher prices in the short term.

MTRX OYOG keep making NCH's.  BTJ is one we added back Friday as far as these sec plays go.

What else in DJIM land...scattered notes on recent stocks around these parts...

AFAM..might have turned back up Friday.  CYNO, has shrugged off the D-grade in sector and is a few % points off highs.

USAT, SLP.  Waiting on these to move over recent highs for us to move into. 

SPEC, is looking like another potential IBD play that has lost its papers to cross the $15 border.  We'd only be chasing these last 3 on a definite show of buying momentum at this point.

DJIM #17 2007

Last week was quite the interesting week.  We go off to a fast start as our closely followed from the previous week struck new big highs come Monday..TSL $68.9, JSDA $32.6, UXG $7.17, JASO $28.30.  What followed was our noted exit before the downdraft began for these plays, which included a few D-grades of note we alerted to Tuesday premkt.  In regards to D-grades, we've said many times we prefer to move on when we see these hit the wires.  Yes..even if your stock wasn't D-graded but is in the same sector, you can expect a sell-off as well.  Especially after a big momo run.  Coincidently, what followed was a few days of boring action in the small caps as the larger caps moved forward.  This action, this divergence started getting many out there saying the market was hanging by a 'thread' or was 'troubling', as the broader market was not playing along.  To us, this isn't some conspiracy that the market is going to implode....it was just boring as we all probably had a rush going into the week off the momentum runners that ran into Mondays action.  Luckily, we had AVNR for a few days to keep us sane ..or is it insane if we're playing these?.  By end of day Friday, we had the large caps confirming the trend, we had the Nasdaq showing support and moving higher on bullish earnings all over the place.  Do we think the bearish mood on small caps seen mid-week will continue?....NO!....if the earning keep surprising!   It's just a matter of time before small-micro caps play along in the bullish trend.   See yesterday note with charts.  Also, S&P Equity research reasserted late last week that mid cap asset class is where investors should stay focused in '07 , going against the grain of Wall street by saying this class will out perform the large caps.   This week as seen in our earnings dates calendar, small caps earnings will start to flood the market and we will most likely concentrate on new names going forward or looking to recycle names off reports. A few small cap stocks came out with excellent earnings last week. These include...

SYNL, its Q1 profit increased to 56c, a fivefold increase yoy and sales climbed to 44.4mln. The report was also sequentially better which shows growth not only year over year, but Q after Q which we like to see.  We didn't feel SYNL was the type of stock to chase pre market, especially as it hit $37.  We simply thought we might get some selling early from those anticipating excellent earnings and holding through, we thought we could get it cheaper.  The stock never saw those premkt highs Friday.  The stock bounced off the recent high, filling the gap and we bought back a position.  Still under a million shares traded, but we definitely like the volume bar it put up Friday and think this could start to trade a little differently than it did in the past 6 months.

ATR, manufacturer of dispensing systems for personal care, cosmetics, food and beverage put out a nice report as well last week that we covered Thursday. A nice spike at the open to $77 before closing up at $75.12. 86 EPS/89 RS #'s.

DXPE, a combo of a favourable chart and the good ole pre-earnings walk up played a role in its 9% action Friday. We are trading this and will let loose our positions before earnings on the 24th.

Steels/speciality Alloy manufactures, we are still holding SCHN.  Other stocks in these groups of interest to trade are RS and TONS.  TONS is for the bungee jumping aficionados.  USAP and its steel-alloy group have a nice chart after a recent pullback.  If the group has a breakout, we'd look for USAP again.

Solars, volume has declined daily on almost of the players. The short squeeze, momo run is over for now.  We have no reason to test the calm waters.  We'll be there when the waters get infested again.       We are also away from the cheap mining plays here as we head into earnings for the smaller names.

Shipping stocks like DRYS have been doing well lately, ISH remains a play too look at.  Very small float here. RCCC, FCSX, ROS, MFW, GLDN, USAT, TNH , some names up there on the watch-trading list going into the week,  but we'd expect new earning names to take the thunder away from the more mature plays in the coming week or maybe a biotech feverish stock or two to be the big plays.

Dow 13K?

Who really cares?   However, the CNBC show has to go on and "intelligent" topic has to be discussed in order to attract viewership.   In all honesty, those who trade stocks for a living don't really have much of a choice but having this CNBC on in case we miss some important headline.   Ok, enough rant here!      Market has once gain showed its inability to march forward and much of the action came from the smallcap land.  With a 91bln bank deal overseas leading the usual Monday activity, we expected more follow through today.  This is a little bit early to talk about but we are about a few weeks away when the seasonality factor kicks in.    Sell in May and go Away!    Ok, so for those members who have billions of dollars at stake, don't blame us that we didn't warn you.  lol   For the rest of us, life goes on and we will adjust to whatever the market environment when changes happen.  There are a few interesting setups today and we are going to go through each one of them....

KRSL,  this one gave us a very profitable trade a couple of months ago and we never take it off our watchlist.  It merely sits in the back of the class until it decides to stand up one day ann makes itself  noticed.    We noticed it earlier today off the news that the co. received a contract(MOU) from UTX.   This is essentially the first good news we've heard from the co. since it reported its last earning.    We'll take it.  It's good to know they will continue to be busy going forward.  The reasons for a move has been summed up in the alert, so we are not going to repeat here.   One thing we have to point out that this one trades very thinly and it can go up as quickly as it can go down.    We got in the $23s and will act accordingly.    Chasing blindly without a plan is definitely not a good idea with a stock like this one.

TRCR, this one reported earning after the close and essentially this is the best quarter for this co.   It beat year over year, also up nicely sequentially.   This one has had pretty steady action since the last report so there's a good chance that it will continue the same pattern.   Although there's no exact telling how the stock will behave tomorrow but based on the AH action, making a new high is not out of the cards for this one soon.  We might actually keep an ear on the CC late morning, or will just watch the action at that time to possibly make another move. 

SILC,  we are going to monitor this one really closely tomorrow because there's potentially a chance for this one to break out.    We believe this is also due to the pre-earning run and eps date is 25th of this month.  Hey, we got one from DXPE Friday and today from USAP, so why not the SILC'ster!

There have been quite a few names that made some nice moves today..SYNL MTOX CYNO USAP. A few of them are the quiet types which include TNH GLDN SCHN GMRK ROS.  We are glad that there's enough action out there despite the weakness from the major indices.

...lets's see what the chips can bring tomorrow off a couple of good reports AH

...streaky

It just happens that writing a Journal keeps us in line to our methodology's of trading. We all need reminders. It is very easy to stray from your niche or your usual ways....you might see a headline or hear a tip from another or two that makes you want to jump in and see what all the ruckus is about.  At the end all that usually does is tie up cash for most and not allow one to get back into a niche play as soon as they would like or at all. This brings us to what we've been prepping ourselves for and hopefully you.   Simply... that is having cash on hand to chase the DJIM niche, earning plays for opening day(s) and not be stuck in laggards that have 'watching paint dry' action.  So far the action is hardly disappointing as we've hit another streak this month with SYNL KRSL TRCR..back to back to back.  One more today and we'll be the Red Sox from the other day!. This is prime example of having money on hand to be able to go hard after a few selective plays,  especially when all the stars line up and you having stellar earning and/or chart to go with it and momentum flow.  Our full attention has been on these 3 stocks but now or even yesterday, one should never forget to do what is right!.   That is to take profits, some or all depending on the days, speed of the play.  All that means is a TRCR was still lased up at the close, while a SYNL KRSL have gone up as much as 5 and 3 dollars from our alerts in a few days. So, yes we have been dwindling down our positions in SYNL, KRSL in a orderly manner.  Early this month, we were riding the JSDA,TSL,UXG etc train.  Our stop came and we got off expecting new plays to emerge.  We wave goodbye and say see ya' later. This week we have new plays and need to say see ya' later sooner than later after the gains produced by them.   Simply, as good as having money ready for EPS season, it is vital you free up cash during earning season to go after the next batch of plays or just one dazzling play.   We are just getting started with small-micro cap announcements, so don't forget the first train is the one you want to be on for the best profits.  The first leg is usually the fastest and most profitable!.  You can catch a connecting train later and have the same seat as before by recycling a play.  "TURNOVER", is the key now.  Use a play, but don't abuse it.  This could mean if we get $14, give or take a few dimes from our first buys AH $11.40's  Monday on TRCR...we would be following the same methodology described above....

A few things...

DXPE and its results.....very tough comps to beat for it this Q. Still it did it,  but probably not enough to get the crowd wiled up. We will watch the reaction and go from there.

RVBD, we might prefer this over DXPE, $33's might have some congestion so we will see how it plays it out.($32now). We will play accordingly if we see it has potential to smash that level or if it does.

SILC, we said this might be number 3 after DXPE,USAP for a pre-earnings run and it didn't disappoint yesterday breaking out to 24.70's. We traded the move and now wait for its call this morning to maybe get in again.

TRT, a few can't get over this one.lol..we put it up on watch the other night and it produced a nice return yesterday for some here (10%). At this point, we prefer to wait on there sneaky mid day possible earning release to possibly play.

MFW GLDN BW RCCC USAT TNH MTOX ATR, maybe a few others round out what we are watching or playing in smaller sizes.

Complacency...

This market definitely feels like there's high level of complacency built in.   We kicked off the week with a hostile bid offer from AA for the good ole Canadian Alcan.   A potential deal like this always spurs activity in the sector and we are seeing the spill over effect into a few stocks.   This and other M&A activity is definitely good news for overall market.   What this means is that since market has been getting constant flow of fresh bullish catalysts, participants are willing to throw money into other secondary plays.   This, in turn, props our index higher and makes every trader feeling positive and optimistic, and willing to commit capital.

SYNL, technically, this one looks really good given the volume + price action today.   For those that may not know, today's action is the result of Louis Navaliier recommendation, so we heard.    The last L.N. play we touched was UIC which was actually quite a while ago.   However, it did give us more than a dozen points added on.   How do we play this then?  Well, we are willing to give this one some room to move so we'd be looking for continuation of strong volume in order for us to continue the ride. This is no different than a Briefingcom profile, a Cramer blurb that picks up on a DJIM stock long ago discovered.  We'll take it all and have an advantage of already cashing in once or twice and knowing the trading habits of the equity in question.

FSLR, perhaps the easiest points, or the safest points, have already given to us by the end of today.    What does it mean then?   We think once the earning fever dies down with this one, it may trade back to the old form again.   We are keeping a close eye on this one and especially on the volume.  Still this report is more optimistic than the last and might make FSLR a better long term bet for new money.

NGA, this one needs a pullback badly, we think.   Why?   The stock looks more tired each day compare to the previous one.    We don't think the run-up is far from over and we are here to buy the dip aggressively.   De ja vu!     We have probably pointed this approach out many times before.  For an EPS momentum stock,  the FIRST pullback should always be aggressively bought.   This to us is not a wait and see play at this point.   We are simply trusting our own experience and instinct to play aggressively on this one.   We like this one a lot.

VOXW, just last night we said not to lose sight of this one. Today's range almost 2 points or 30%.  Volume was higher than the last weeks big day, so some money is discovering the run-up potential in this name.

Some other notable plays we like today include VDSI TNH SCHN and BTJ and these aren't strange stocks to DJIM.   At this point, we are just curious to see how broadly this market can participate so we can find diversified opportunities to trade. Since capital preservation is key here, not meaning doing nothing but rather taking profits when we get a nice ride.   Today, we were glad to have our capital securely away from DNDN, IDSA.

Resiliency

Even Dow's winning streak has been as long as our Blue Jay's losing streak, we know that one of these days their respective streaks will end.   At least in the case of Dow, it's more probable.    Today's the day?    In a very dramatic fashion, Dow closed just 4 points lower.   This might as well be a winning day for both indices.   For those of you that haven't kept the score, both Dow and Naz were off to some good downside action earlier in the day and managed to climb all the way back.   Is this resilient or what?    Again, we will have another test tomorrow with both the CSCO reaction and Fed meeting.    In either case, we think this market will probably go higher still.  During this streak, the majority of the gains in the indices was in the first hour or so with the rest of the day seemingly distribution going on.  Today..that all changed as we saw another side of this market!

In terms of DJIM land, some of the stocks were down earlier but were managed to climb all the way back and some.   What we do here is to make a note of those stocks that managed to come back and those that did not.    For those that come back, we kept some and even added to some.  For those that did not make the afternoon rally, we pretty much cut them off from our position list.   Still, we had about a dozen or so stocks left in our account.    A day like today gives us traders a perfect vision of how strong some of our plays/picks are.   When the market is really green, it's just that much harder to tell.   When the market goes through a shakeup earlier and comes back, you do want to see your favourite stocks to perform exactly that and maybe then some.   If not, time to move on.   There's plenty of good candidates left and new candidates coming up down the road.   There's never no need to be hung on any particular play.   After all, these are just stocks, we don't have any sentimental feeling toward any of our plays.  Just a game!

Here are some notable ones...

NGA, this one definitely surprised us today.   Normally on a weak morning like we had today, a stock like NGA which had such a strong run-up would definitely feel some pressure to pullback some.   Well, it did, sort of, on very pathetic selling volume.   Maybe, everybody has the same play book as us or maybe, this is just one hell of a strong stock.    In any case, we have to be quick to recognize what is going on and act accordingly.   The action, of course, is to chase it higher.    We chased some from low 13s all the way to high 13s.    Bear in mind, we have also lifted our aggressive buy on dip points from low 12s to high 12s, or maybe even higher depends on how it performs next little while.   So basically, when our somewhat conservative attitude toward this one proved to be an incorrect call, we just had to correct our approach as quick as we could.  This is a high stake game where opportunities don't wait for you to make up your mind.   They come and go and you as traders, just have to grab them to the best of your ability.

LXU, this one reported earning yesterday and that was the catalyst.   Boy, would you look at the volume past two days.   This stock has never traded this much volume according to our memory.   Believe us, we have followed this since the $8 range.  It was one of the first DJIM Journal pick entries back in August 2006 or was it 1706 as Mr. Bush would think and slur.    Basically, we like this action a lot.   Sector is on fire with POT SQM TNH...  So why not with LXU?   We think given the valuation of this one, which is still a baby, institutions are getting in big time.   We call it an instant lift of valuation.   How else can you explain the volume?.  From what we recall there is incredible value if this company gets broken down into different segments.  Maybe this idea is again refueled.

GTI, a ha, another IBD play you say!   Well, this is just added bonus we feel.   Whatever is happening with this one, it's going toward the right direction. One thing this is..is a turnaround story that is being liked.  The volume suggests it isn't common retail folks like us that are getting involved, which is good.  

Besides the above, we also like the setup in CUB NTLS TRCR TNH EDU.

Shakedown..

'Breakdown....Takedown....Everybody wants into the crowded line... Breakdown....Takedown...You're busted...Let down..your guard..blah blah ..you're busted!".  Yeah, we're humming a guys tune who probably already had a beard when we born!.... but hey, what's the ruckus today?..We still in the loop.  Cheer up, it's not the end of the world!.   You know what was looking like the end of the world?....

The market being up something like 24 of 28 days!!.   What percentage is that?.   Sure , ain't Shaq's free throw percentage!.  The point is simple, what the "Disney" did you expect to happen sooner than later as we ran the market higher and higher.  Today should not be a shock to any of us. If you've ridden the DJIM plays recently, you are probably safely out by today anyway on most positions with nice gains..   But seriously, if the market shakedown scared you today, you still had a perfect storm to exit with gains in tow today.   Why...you say?

Let's see DOW down 147, NASDAQ down 43.   What really stunk the DJIM joint out?    Well, percentage wise it was NGA!.    But, we've all expected and actually welcomed a decent fall after this 40% run with DJIM hands all over it..   This was going to happen, no matter if the market got smacked or not today.   NGA was prime for it.   Besides the NGA bit,   there was not much damage to anything you might be holding off DJIM. You still could walk away today all in one piece if that's your choice.

FWLT  TNH  SPAN  CPY  FTK  IDSA  FSLR  KRSL  ADPI  are some recent DJIM names traded that managed to post green end of day.  Tomorrow..all these can get the smackdown and other barely reds like TRCR  LXU  MA  HAYN  NTLS (1% or lower) might as well.    What you had today is exit opportunities to leave with almost all of your recent gains in these names.   The next day you might not!.     Be it tomorrow or any other time in the market, if you survive one day...you might not the next if the slide continues.    What we hate is to be part of any domino effect, so today we did some selling into this orderly action of our closely followed/held stocks.  We don't want to blow the past months of good work out the window.   Safe than sorry heading into a weekend at this point.   Still...there was no action in any DJIM recent play that money screamed get me out of here...fast! .  We like the group we are covering at this time and will monitor closely as always.

As full time traders, we look to end of day for some fire sales on our favorite winners lately.  We've talked about buying a pullback for days on NGA...last night the last.    What we said today in the forum as it traded $13.80-14.00 from it's highs, is the market conditions today basically stamped out a chance for a orderly pullback and buy possibility that we expected from it before weeks close.   If the market (NASD) is down 20 points,  we do not know if panic will set in on any individual stock and take it down further.   We can't buy such a fresh pullback as NGA hung around $14 at 2pm!.   As a trader member pointed out minutes later, "would rather buy a pullback within the context of a stronger market day... Opportunities are made up easier than losses.".    Minutes later NGA crumbled to 13.20.   So how do you know when a pullback is sufficient?...is it the one down to $13-8-14.00 or will there be another as later today to 13.20?....We simply don't know and we're not going to guess at $14 with a falling market.    Basically, why play with fire as the market starts to crisp and burn.   Simply, we wait till end of day to decide if we want any.   We do it with strong stocks to buy in or add more and this is still the way we go if considering to recycle a recent big winner on a dip.   End of day.    Yes, we picked up small amounts of LXU, NGA  end of day.  This is nothing in size to when we were playing these recently.  We all should have enjoyed these 2 runs, we are not blowing it away with a substantial position now on a dip in a falling market today.    If any sign of momentum comes Friday in NGA, we'll be there in sizes again.    Call it another starter to monitor today, that's all!.   Still, the issue with NGA should not be if it catches a pullback and heads to $15 tomorrow.  What's 13s-low 14's to 15's at this point when the play has been here since a premkt alert at 9+ and soon after buy in low $10's. If you won big from low 10's already, what's the rush now?. Let it sink in and let it show a definite change in trend.  Is this a possible secondary leg coming up?.   Was this the retracement we were waiting for?.   We'll know soon enough (Friday).  We just went through IDSA remember, so you know what can happen.  What it might do at /if $15+ is a whole new different leg and we'll decide then how to approach it.

For those new here, our Aert-Comments are either our buy-ins or leads we are considering for a buy.  Today was a nice combo to an alert from Monday on FRPT to go with our buy in alert on SPAR today.  Both had stellar days in a bad market and were involved in the same contract.  Yeah looks like Cramer gave a hand to our pick ups again today.   We were oblivious to who or what or why...we just saw momentum happen at different times today for these names.  The idea was here Monday following the Armor Holding M&A activity for a look at  FRPT with its chart, today it paid off as FRPT and the company making the chassis (SPAR) for it all won. SPAR last trades at 31.60-32 AH. 

DJIM #20 2007

Rundown of DJIM's closely followed heading into Mondays trade...

TNH, definitely one the big winners on the week with a 24% pop.  We profiled Terra Nitrogen, fertilizer maker, back on April 8th (DJIM #15/#16), we said if you catch it on the right side, it could be quiet the ride. The right side has been now with Nitrogen in great demand and because of NG pricing.   The stock closed at $95, up over $30 since April notes.    Remember, she can be the volatile one and the higher she goes, the higher the chances of seeing greater volatility.

NGA,  though this one did not finish over $15 as per IBD requirement,  it might as well have finished above it to ease the suspense.     So is this more than and IBD play or not?   At this point, who really cares?    As long as the volume + price action do not die down, we are going along with it.   What we feel is that there are momentum hedge funds behind the work of this one which explains the consistent volume.   We like this one because of its relative liquidity compared to some of the other low priced IBD plays.    Why does it matter?   For those of us who trade more than a couple of thousand shares at a time, this is the kind of action that can get you in and out with relative ease.   What we are watching out for is the blow off top volume, as a warning sign.   So far, so good!. Our note pre market indicated some selling might come off the insider selling news.  This happened and provided a nice dip into the $12's early on.    Hopefully, some were able to get more there or low's $13.   The fact this occurred probably held NGA off $15 for now..   Why?.    If you bought high $12's, very low $13's Friday, would you not have sold at the high $14's if you loaded up in the morning???.  We did some.   Once this moved beyond $13.50ish, you knew new money would be coming in so not to miss the run to $15 and above.   No better place to sell for someone making a morning buy in the 12's- low 13's, don't you think?.     We're patient.    IDSA now NGA.  In so many ways this played out just like IDSA last week.    Hopefully, you were prepared to trade it smartly after last week.

IDSA   so the stock made it to IBD#43, a week later than it was "supposed" to.  Lol   Well, things will definitely get more interesting from here.   We think the exposure of IBD does bring more positive things to a stock than not.   It actually brings this one to many more traders' attention.  The OS/float definitely stands amongst the IBD 100 names.    As long as this one is getting more exposed, it's unlikely that the play goes away anytime soon.   We are using our usual approach with this one from now on and look for new highs as an excuse to add and 9 ema as key support.  Simply, the traders gut told us this was the one under $15 that was going to get riled up friday in our morning note.   We added in forum the night before to a IDSA question..Needs volume!.  We pointed out volume was at the previous days high quiet early, Friday. This was indication to us more was to come and a good chance this was going to take IDSA beyond $15+.

FWLT, wow is the word to describe the action in this one.  In our opinion, this is the kind of stock that's much much easier to play compare to NGA, IDSA and definitely the SIF's of the world.   Why?   This one is a liquid monster, an institution's heavy play.   Even as retail trader, we have no problem of going big in size and playing with the big boys.  You can't do this on a SIF type.   Of course, if you have a smaller sized account, this one still provide lots of fireworks even for small lots.  For every 100 share lot at $78, this made you $1800 in a few days.  Again, we say, don't back away from the expensive plays such as this and the MA's so easily.... As we tried to point out, we felt FWLT had more short term upside potential from the pre-mkt prices of FWLT ($78) compared to TRT's (19.50).   Based on closes Friday, FWLT is up 22% and TRT is 12% from that  possible morning buy-in and has been way more liquid to trade.

LXU, this recent DJIM pick up is gaining traction and starting the ride the coattails as many are starting to see it as a Ag play.  Their chemical biz seems to be thriving as seen by EPS results and it's definitely one of our favorites.   The ticket here to consider!. POTash is around $200, TNH, is near $100 and if I might have missed the ride, maybe my only only logical cheap play here might be LXU??.   Hmmm.    It is in top 5 performers in the Agriculture section of IBD movers.   Besides, there is a new #1 IBD Industry Group and it is Agriculture and Fertilizer...really, we're not fertilizing you!

SPAR, this pick up pre market the other day at $30 was a quick bump to high of $32.70.  We sold some Friday into the Cramer push and later picked some up cheaper again.  Selling into strength generated by outside influences, such as Cramer is a no brainer.  This one falls into another sector that is thriving.   We were watching this angle since AH takeover by bringing FRPT into the DJIM fray Monday. SPAR is intertwined here as they are the chassis maker dealing with FRPT.

CPY, we put this CPY back out at $80 Friday on alerts as a buy in again.  It manged to climb another $3 bucks higher at one point.  Just keeps on ticking and it is more than the retail investor buying 100 lots here that is still driving this higher at these levels.

TRT,  we are holding some TRT but on a short leash to see if a IBD crush comes.  The play here started back in 2006 based on EPS and their China connection starting what we thought would fuel this compnay.  We played it now for another 2 Q's  and this is the first Q that we saw revenue slow down.  It was actually a tad lower sequentailly and Product reveune dropped some 20% sequentially.    So has the Asian buzz hit a wall as these numbers might indicate?.    At this point after 3 excellent Q's,  you should not be looking at YOY Q numbers here,  but sequential growth.   If this was a big Semi name that showed no sequential revenue growth,  besides the under 300k in net income, it would likely been a ho-hum report as analysts would not be looking at YOY if they had been placing estimates on the stock for this Q.    They would have looking at the 3 previous Q's since we've been following it and their expectations would be based on that!.   Simply , sequentail reveune growth has been curbed some it seems for now.   $6.4>  9.5>  9.9> 14.06 and now 13.6mln in revenue for the last 5 Q's.    An advantage of no analysts covering a DJIM stock is seen here.  The problem is the company gives no guidance, so you don't know if the revenue has hit a peak and if EPS next Q might hit a snag as well.   Anyways, we're in for some, this just ain't one of our top holds at this time.  We'll see how it starts to play out early in the week.

SPAN, a May pick up( profiled in Alert sec), is the little engine that could, a slight pullback mid week and then a NCH to close out the week.

SIF, a hot market definitely brings out hot money in the micro caps. At this point anything new is beng chased up if the headline numbers stick and we joined in with some of you for a quick trade.   Definitely, some of you guys got more out of it than us!.   Great!.   With so many plays on our plate Friday, we left this while the exuberance was high and while it was still possible trade the bigger lot sizes to make it worthwhile.  We don't know if that will be the case by mid-week, if we wanted to sell a big lot hold at a decent price.  Time will tell.   You see, some plays are taking EPS to a different level in this market, as in potential one Q wonders being run as if they will be what TRT, BTJ, DXPE, NGA in the beginning of their cycles.  Those companies were turning around and you could see by their growth figures.  Not only YOY growth, but sequential revenue/EPS growth as well.   This is how companies become IBD inclusions.  We see pretty stagnant revenue growth Q over Q's at SIF with one good EPS Q under it's belt now.   There is no saying this company can pull off another going forward, despite being in a good sec.   We don't see it as 2 Q's with upside EPS, last Q was almost all government grants income that made up the EPS #.  We're not knocking the company, we're just saying it's not for everybody to trade here, especially if thinking one EPS Q will make it the next NGA, BTJ, DXPE etc.  This simply means for those considering playing SIF starting Monday,  be careful if thinking this almost 100 year old co' will become a solid player into the next few Q's.   DJIM members need to differentiate the type of plays conducive to their style and abilities.  This is all we are pointing out here.   For those giving it a run....keep pushing and we might be back to help out.   IBD numbers are on equal terms to TRT's and made it on Aerospace IBD hot list this weekend.  Institution holdings are about 25% in this name, if their Blackberry's were not working overtime selling Friday, this upcoming week might get some of it.  If the shares get in retail hands, who knows what can happen in a happy market.  Will leave it to the speculators for now and concentrate on companies producing revenue, EPS growth Q after Q.

CROX FSLR TRCR ADPI HAYN NTLS MA SYNL, all behaving fine after being followed closely here following their EPS this Q.

HDNG TWIN FTK  added to IBD or moving up as in HDNG case after EPS #'s last week.

This market is moving clearly off the earnings of S&P co's, small caps etc. and we at DJIM definitely are simply in the right niche at the right time!

Carnage in the far east...concentrated

Fortunately, the damage in Shanghai did not spill over to North America.  On the contrary, we actually had a pretty good day for a lazy summer session and many DJIM type of stocks were particularly shiny today.   If the market was to get a shake, you'd have seen the beginning premarket.  Nothing of that sort happened as the FXI stayed calm and a few Chinese stocks were actually green. Instead of any housecleaning, we were buying most of the day.  Does today's action mean it's a sign of things to come?   We'd like to hope so but we aren't wagering all of our eggs in anticipating anything.    Basically, our game plan is not to get too over our heads in worrying about the big market movement, but rather, focus on individual plays and sectors that are attracting hot and momentum money.    Afterall, we are not economists that emphasize on theory which goes into the far future but we are traders that focus on the live battlefield level action day in and day out.    There are quite a few interesting plays today, so we are not going to waste anymore time and just go right into them...

TBSI, this is a play that we have been involved in the last couple of weeks or so.    What we really liked about this play is its text book style of action.   Sure, it doesn't have the heart pounding NOVC like of action but this one gave us the kind of setup that most traders would be happy for.    This one built a beautiful flag pattern last little while and it shot up today and closed near the high, with some good volume.    This is the kind of play we love b/c not only it gave us enough time to get in during the setup, but we are also able to built up a comfortable position that mattered in a very controlled, conservative, and highly probable way. A nice 5-6% day.

KMGB, this one came to our attention before the market opened and we immediately put it on our watchlist.  We actually put this one up back in 2005 and it doubled by the next morning.  That was its first stellar EPS Q.  Today it came out with earning that not only beat the analyst's estimate by a nice margin, but looked very good year over year, and sequentially, by our book.    After further checking its IBD number (92 98 now), we just couldn't help but start buying up shares.    Now, every once in a while you get a high calibre, high momentum IBD play that gets lots of traders' attention and we think this one is a very good candidate, after NGA that is.

ATLS AHD, a few weeks ago ATLS came on our radar after it acquired some assets and made a nice move. On the weekend, we had put AHD on our watch for the week because the chart made a NCH and was related to ATLS.  Before the open this all came together in a different way, the idea behind these names and a trade on news.  ATLS, which owns partner units of AHD announced the APL (Atlas Pipeline, LP), had made agreements to acquire assets of Anadarko and then Atlas Pipeline would distribute $$ per limited partner unit and increase distribution....LOL. Confused?. Hell yeah and all this doesn't mean anything to us!.  All we know is this was another 1 billion asset deal that was liked once, so why shouldn't it be once again. The fact the charts were prime and the trading action called for an entry in our book.

LPHI, this one definitely caught some wild fire after it guided up intraday. Early this year, we put this one up after a good EPS Q to look at. We wondered if a life settlement stock can actually get that sexy look.  It didn't for traders, but quietly it had almost doubled since.  We really couldn't speculate the true effect today until after the initial excitement settled down. This one can have some whacky spreads.  When it looked like there isn't any sign of pullback, basically there's only one place to go and that is up.   We are also trading this one aggressively. Co sees Q1 EPS to be approx $0.49 per share vs $0.11 single analyst est compared with earnings of $0.05 per share for the same period last year. The co also expects Q1 revs to be approx $17.5 mln vs $8.4 mln single analyst est compared with revenues of approx $6 mln last year.

TNH, after about three weeks of consolidation, we think this one is ready to break out again or at least test the high area.    Yes, it's a $90 dollar stock and we aren't discriminating any stocks that we feel have the potential to pull a good move. We all know the power of the MA, CROX, FWLT expensive plays now, don't we!.  We are monitoring the action closely. The mid May high is around 92.50 after the sell off.  Today was the first day it closed over 90 since.

There were quite a few new positions /stocks taken today.  This shouldn't take the spotlight away from this Q's DJIM plays that had a very good day.  TRCR +14%, CUB +6%, RCCC 3.9%, IDSA +4%, GTI +2%.  Not bad for a day the DJIA up 8pts and the NASD up 4pts.

A Good Test...

When a market participant looks for a catalyst that can potentially change the general direction of the market, he/she usually looks at the homefront, where it matters.    Sure, last few days the oh so powerful Shanghai market seemed to have derailed badly but there isn't any talk of catastrophic consequence in their economy as a result.   Hence, the action did not spill over to America and whatever happens there, stays there.   Today we had a little something different and the worry stemmed from within America and the never ending talk of "interest/inflation worry" came up again and many talking heads feel this is the cause for today's slide.    For us, we literally had to check our quotes more than a few times just to realize that we are indeed in a "selloff".    Oh yeah, GOOG just made a new high and closed well over $500.    Maybe, people are just spooked by the fact we haven't had a good ole "whack the bid" kind of day in a long time.   So there, we got the selloff today and it's time to move on.

Aside from the Index action(which is total BS in our opinion), we are seeing some very good and healthy action among few individual stocks and certain sectors.     Ok folks, whenever you see more than 90% of holdings on your watchlist are having a bad day, then you may get a bit worrisome and think about some quick exit strategy.    Good breadth gives us the courage to stay and chase while bad breadth simply chases us away.   In our opinion, breadth is the key telling of whether we should be hanging in this market or not.

TNH, +5%, this one did not disappoint a bit and came out smoking off yesterdays buy in and finished just as strong.    This is in fact a new closing high and it'd be interesting to see if it can challenge the triple digit area.    The whole group seems to be up today and we wouldn't be surprised if this one goes even higher given the sustained movement in the entire sector.

CROX, whenever the other two DJIM big guns are taking a rest, this one takes over the baton and charges higher.    This is almost 20 pts higher since our initial buy about a month ago.    This goes to show that whenever we see a highly liquid stock with a very favorable probability of pulling multi point runup, we just have to go in big and patient.    By the way, during the runup thus far, this one has never closed below 9 ema.   It kissed 9 ema a couple of times but that's about it.   This is a sign of a very strong stock, historically speaking.   As a matter of fact, exact same deal with both FWLT and MA, neither of those closed below 9 ema ever since their EPS breakout.

GHM, this is an old name that came out with an excellent Q.  We admired the effort premkt as some(one) was working hard to prop up the price. buying lots of 50 shares, including one order at 23+ plus.  Unfortunately, they don't seem to know these odd lots don't appear on many trading platforms. Oh well. The action picked up a bit premkt and it traded to $22 in the first 10minutes and $23 in 10 more after the bell.  ,With the market sliding, a CCall coming and we just preferred to play some later on a probable dip later.

A few a stocks off yesterdays buy list hung in tough considering the early market action, but especially since they were up big yesterday. This includes KMGB LPHI  AHD and ATLS which was given a tgt bump up to $67 by FBR

CUB, up over 25% since we alerted May 3rd closed with another NCH, this is probably finally being recognized as a defense name!. Another DJIM defense stock hovering near highs, SPAR also had a nice day up 7%

MFLO LXU,  we are keeping a close eye on these two as both are in our opinion setting up for a potential b/o into new highs.

A true test...

If yesterday was a good test of your holdings against a shaky market, then today definitely gives a true appreciation of how "good" your holds are.     Of course, if we get few more back to back shaky days like today, it probably wouldn't have mattered much what you hold.   Overall, we think the market action is healthy.    For whatever the catalyst/excuse that caused the slide, it's needed to correct this market into a healthier stand.    This is assuming that this is not the beginning of an end for this market here.   At this point, we don't believe it is and we are acting that way also.

We have a number of good closes today and given another hour, we think some more stocks culd have battled their way into the green.    Individualism is running full and strong in this market today.   Breadth is poor but if most of your holdings are in green territory, you'd feel that you are doing something right and will try to keep it up.   Can you imagine if last two days were up?   We'd been asking that question throughout last couple of days...

KMGB LPHI,  these two were the stars two days off their respective earnings announcement and they've held up very well despite the market weakness.   We added some LPHI today because we feel this one has had the best action amongst our holds.

CROX, good stock battles back and this one did exactly that toward the end.     As it comes near its split date and we think the action will heat up accordingly.

AHD, so this one only did less than 40k shrs today.   This stock also has only 4 mill float and probably less if you take into account the institutional holders.    We liked the deal that was announced couple of days ago and think this one definitely has the potential to move up.

GHM CUB put in very respectable green days as well.

Many recent names here such as NTLS MFW LXU RCCC ATLS TTC SPAR MA TBSI barely broke a sweat in the profit taking sweep across the market,  even the volatile TNH battled at over $95 till the last 30 minutes. 

One we added today, VSNT (Co reported May29th,Q2 EPS of $0.52 vs $0.32 in 2Q06; revs rose 37% YoY to $5.2 mln (no estimates). Co raises FY07 guidance to $1.50-1.62) falls into above category.  But as we said at the start, if we get more shaky days it probably won't matter what you hold.  Unless it's cash of course.

DJIM #24 2007

In Sopranospeak, FUHGEDDABOUTIT! was the markets message Friday.  Unfortunatley, it won't be so easy going forward.  The rally defintely has felt true pressure and last week has fueled the bears.  What spawned the rally we've experienced for months was rehashed as earning (NSM) and M&A (X) activity were again two of the catalysts the spurred the recovery rally Friday. Oil helped and CNBC feeling the uproar from their audience got Gross to appear to elaborate, more like clarify on the headline they spewed Thursday afternoon.  All this closed out one wild week and if you took a chill pill Thursday night with us before drawing any drastic conclusions, you had no need to empty your book before the weekend.  What the recovery rally provided is it drew a line in the sand.   The lows on the major indices Friday will be the area to watch for many.  If we break this area, we will become very cautious of a secondary correction.   If this area is kept away from, we should be able to trade accordingly. One thing though is earning season is over and that major market catalyst is removed for the time being.  Can the market continue on with M&A activity pushing it till next earning Q.  We've got about 3-4 weeks to find out and we will trade in smaller sizes until, especially if playing this Q's DJIM names.   You want to be in size at the beginning of a potential earning move eg CROX, FWLT.  The first leg you could say.  At this point there is no way we would play these in the same sizes as before, we prefer to wait for a new crop and by that time we will know exactly where the market stands!. So for now we'll remain cautious and go with a manageable book.  Not too many positions and not oversized.  If this was a sign of volatility for the summer of 100+/-30+/- pts days, we'd prefer it to the laziness we often start to see at this time of the year.

Even after the tumultuous week there are more than a few DJIM's still trading near highs or making them. These are the stocks we are concentrating on. The partial theme here is to always play strong stocks!. Common sense says a stock that survived last week and finished near highs is a strong stock...common sense also tells you if the market starts showing signs of slipping again, these probably won't stay strong much longer.  Unless fertilizer is the next black gold!...A few of those are...

KMGB LXU TNH are all chemical stocks in one way or another, all showed strength before the rally clicked and so we were buying them again as the market gained strength. KMGB made it to the #40's in IBD this weekend.

CUB CROX RCCC NTLS MFLO still trade 9ema or above, very little damage sustained over the week.  Again 9ema is an area of short term support for most of the stocks we cover. We want to hold stocks above it, not below it!.

LPHI, GHM are fresh names (3-5 days off gap earnings) and of course are trading above 9ema.   

MA got some good news and might recapture the 9ema quickly from it.  FWLT did that Friday, but barely.

ATLS, if sec turns this could be ready to bounce off 9ema level.  AHD, holding up well.  

The shippers got whacked and we'll likely just watch them for now.

Sluggish mkt...except

The only thing last weeks terrible performance not do to DJIM stocks was put a ribbon on them for today's action.  Today was definitely a GIFT as there were plenty of remarkable performances.  You have to figure the bargain hunting started Thursday afternoon and today was just the icing.  With the icing comes some froth, which is always a good time to pocket some points.  That is unless you think a KMGB, TNH, GMH, CROX will put up back to back huge days.   We'd rather not think and just line our pockets first and then consider re-entry.  This is especially true when DJIM stocks are outperforming the market as a whole.   We love NCH's but when you get a intraday 10%+ move in a KMGB or a 8pt move from TNH since friday, we will always take a load off and ignore a potential NCH end of day..... This is especially true if the market is showing signs of losing steam off only modest gains during the day.   You couldn't really call this bargain hunting buying as almost all of these big gainer stocks were already trading near highs, so maybe it was just being in the right place at the right time.  But the right place and the right time require the right stocks!.   Not much else to say about today, hopefully this euphoria over DJIM's today carries over to the rest of the market tomorrow.  We can't survive on our own.