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Extended becomes more extended what more can we say. I really wish there was more to say but there really isn’t. From a daily perspective we are currently in no mans land with nothing but resistance levels ahead.
IF you are not there (long already) don’t get there as you are late to the party. The party (as usual around these parts) started in the face of fear. Now? Just scraps in the short term on the buffet table are left. Lets see if in the next few days the caterer can bring out some more food.
12-5 Up up and away it seems. Could we keep going? Sure, but as for any low risk entry points to be had on the long side that we don’t have to chase? FORGET ABOUT IT sayes our little green friend. We don’t chase buses. Especially if you are a gecko as it usually leads to splat.
Tomorrow we’ll talk wave counts. Bullish and Bearish. Make sure you brush up on your 3’s and 5’s.
SHORT SIDE WATCH LIST
12-5 This is a WATCH LIST and we stress WATCH. DO NOT SHORT ANY OF THESE NAMES JUST YET.
Over the weekend in the change in trends section we said:
Keep in mind that these names are still in the 5th wave up. This also means that they could breakout into new highs. To the novice IBD type person that would be a breakout to buy (of course in keeping with the trend of gaps and go odds favor they breakout in the form of a gap assuming that is what takes place mind you).
DO NOT even consider that as we’ve seen in detail what has been happening to breakout buyers who operate from looking only at patterns in a sideways horizontal fashion verse multi-dimensional like we do. Not to mention as shown above in the index charts after a gap up they tend to go nowhere right after. Just saying.
All of which makes me say for the most part these issues are toast going forward and will end up topping out and stalling up in here. Said another way, the party ends are midnight and its 11:30 PM with these names.
CVLT
AKAM
FFIV
RHT
LONG SIDE WATCH LIST
"Only The Best And Forget The Rest "
"We Trade What We SEE, NOT What We Think, Hear Or Fear "
12-1 Given what we’ve seen in the indexes the last few days it stands to reason this list should be very small and rightfully so. Until we see some work off of the overbought conditions (sideways or down) this list will stay small. There is enough names out there on the back burner that given some sort of backing and filling and of course some POH-ing that we’ll have enough to work with in the coming days. As they develop we’ll bring them front and center. Right now though let’s exercise some caution as we just ripped.
ATHN
12-5 Well you can forget about this one. Not until we can see some sort of pullback and that’s that.
CURRENT POSITIONS
"Let Your Stocks Tell You What To Do By The Action They Exhibit"
NOT YOUR EMOTIONS!
LONG SIDE POSITIONS
12-5 in looking at all of our remaining positions we’ve really got nothing bad to say about them here. Heck another day like today in them? Fine by us.
I would not though be a buyer of any of them currently. Sit back and allow them to come to us is the mode that we are in when it comes to deploying money on the longside here. We’re more apt to be sellers soon than we are buyers
NUS (We are long 250 shares of this at 46.42 as of 11-28-11)
12-5 Looking good. Sure would be nice to catch a three point plus move in here
12-2 Heck at 48.62 its a quick 500.00 worth of gains. The one minute charts show this issue POHing in that time frequency btw. A retest of the highs too though would seriously make us get out much like we did with FIO CVLT RAX.
12-1 Looking ok here. A break below the C (red line) and we have to walk away.
VHC (We are long 300 shares of this at 21.64 as of 11-11-11)
12-5 That 25 level is a resistance level so be aware. What it could do is initially act as a ceiling that will need to be busted thru in order for it to go on a run. IF that issue over the coming days can consolidate sideways and then breakout? Well at that point it could be bought again. Lets watch for a consolidation of this recent move before we consider anything.
12-4 At one point this issue was down for us to the tune of 17% on its own. HOWEVER due to trade size risk management and this issue only making up 3.6% of our overall portfolio the impact to the whole was a measily, stinking, lousy less that 1/10th of one percent!!!!!!!!!
Look (and this is very important) trade size risk management will save you every time! As for the 7-8% traditional stop loss rule that many of you apply? The Gecko says forget about it. In this climate? When you have a market that week in week out puts on 7-10% weekly ranges up and down with most stocks doing double that? You’ll do nothing but get stopped out left and right. Again, this isn’t the 90’s anymore.
An important point we want to make about that is also that about the time you start freaking out with fear (an emotion and you know how we feel about trading off of emotions around here- no wimps allowed) the damage is already done (otherwise why would you be emotional right?). It’s also just about the time the stock is ready to turn too. Those lows were also stabilization at the 50 day on the daily charts. Notice how the technicals were saying to hold on at the end of December by the double bottom? The launch also happened to correspond with the market taking off too.
The point we want to make folks is that there is more to placing stops than just saying heck 7-8% and being done with that.
You have other factors to consider of which the above is exactly those other factors we are talking about.
We’ve even talked in detail here about how you can be down 20% in a growth name and still only have it show an impact to your overall portfolio of only 1% thanks to trade size risk management.
AAPL (We are long 25 shares of this at 398.56 as of 11-1-11)
(We are long 25 shares of this at 391.78 as of 11-10-11)
Our average cost on this issue is 395.17
12-5 Well that 200 day average sure works as a charm now doesnt it. right now though? Gosh see any Pullback Off Highs (POH) that we can work with here? Me neither. We’ll consider this issue a hold right here.
12-1 While this issue doesn’t look all that great it has structure. The structure is that it went into a correction and sold off to the 200 day average and is now working its way up from there. Let’s see what happens at the 50 day average at 391.70. Keep in mind if the market wants to pump the indexes this is they’re star player to do so as it makes up a large percentage of the indexes. Not to mention every mutual fund on the planet owns it.
SHORT SIDE
NONE BUT that is going to change by the end of the year!
