Friday, September 29, 2006

Market Scribbles and a Clip

During the trading day, I am not at the computer for long stretches. Therefore, I keep a written journal in which I scribble notes. Here are today's scribbles copied from my journal, which may not all make sense since they are notes to myself:

Many energy, metal and gold stocks have pushed up towards resistance. Watch this area closely as it should tell you whether this bounce is truly a new upswing or nothing more than a "dead cat bounce".

I still don't trust this upmove. So many reasons why:
*Volume stinks.
*Big caps don't lead bull markets. The fact that tech, transports, banks, mid caps, small caps and semis have not kept up is a bad sign.
*Rotation into big caps is a sign of the final phase of a bull market.
*New highs have not increased and new lows have not decreased enough to support a bull market.
*Even within the DJIA, only a few stocks have reached all time highs, while a few are way off the highs. There is a big divergence in terms of what the DJIA is doing as an index and what the individual components are doing.
*There's a lack of high flying momentum stocks. Boring moves dont' make for a bull market.
*Historically, strong Septembers are followed by weak Octobers.
*Most importantly, my own personal watchlists show more shorts than longs

The inverted yield curve . . .more bearish news.

The longer the bulls have control, the harder the fall will be. I'm ready and can't wait.

Play the upmove, but be ready to jump off at a moments notice with tight stops and plenty of shorts on the watchlist.

HP will survive the scandal. However, they may not survive many more stupid moves like today's Voodoo acquisition.

Song From the Playlist:
This classic by Earth, Wind and Fire typifies what September was like for the bulls

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