A LITTLE SOMETHING FOR EVERYONE
I'll be updating the charts tonight. As I outlined over the weekend, the markets were in the mood for a breakout. They started the morning strong...ended with somewhat of a whimper, especially in the Nasdaq. I have been focusing on the SOX, as it's a market leader. It did indeed hit the top end of the channel and pulled an ugly reversal today. Nasdaq followed, however, it did manage to close the day up...well off of its highs. S&P did better...closing a bit off its highs. I'll be going through some indexes, indicators and stocks tonight, as we're at an important point for the markets...
GIVE ME YOUR COMMENTS!
Comments are now open on all future Zenpenny postings. Let's get some discussions going. Challenge me!
NEW ADDITIONS TO ZENPENNY COMING SOON!
I'm working on adding a weekly video screen cast to go over some charts and give our readers a better understanding of exactly what to look for, as well as our unique interpretation of technical analysis. It will be a nice addition to the site. Members are going to videos several times a week. Again, a good way of being crystal clear on the thinking behind our investments. My view is that the more lines of communication I have with readers and especially members, the more effective and profitable our service will be. Until tomorrow....
NEW RESEARCH REPORT RELEASED TODAY
We have just released a new research report on a company that is a real midget, with a market-cap of around $15 million. This is a $50 million company trying to walk on its knees. Only a matter of time before it gets up and people realize what is at hand. All the angles are there: it has a value angle, a restructuring angle, an activist angle and it's even a China play. 3 page report outlining all the facts. Available to current members. Join...
TOP 3 MOST POPULAR POSTS FROM THE PAST WEEK
1. APPLYING POKER THEORY TO SPECULATION IN THE FINANCIAL MARKETS 2. LASR (GSI GROUP) ANALYSIS AND BREAKDOWN OF WHAT WENT INTO OUR DECISION TO BUY LASR 3. THE THOUGHT PROCESS BEHIND A NEW STOCK WE'RE...
WHY A GAP DOWN TOMORROW FOR THE GENERAL MARKET MAY STICK
With all the house cleaning the bulls did last week, getting all the "earnings are baked in" bears out of the way, there may not be much in the way of bids to hold this market up in case of a gap down tomorrow morning. The shorts were cleared out all of last week, especially in the market leading tech space. Not to mention the fact that bears hate three day weekends away from the market in the midst of a table and chair match, where they are getting continually pounded. As for the buyers, most of the "I don't wanna lose my Wall Street job" performance chasers who underperformed last year and were catching heat from above, are fully allocated into the market following last weeks move up. They weren't going to wait until the second half of January to allocate...they had to do it quickly and they have been chasing performance all of January. The bids will be light my compadres. Beware of any gap down...the gap may be retraced initially, but that's as good as it will get. A rip-roaring ascent for the markets tomorrow morning - should we open weak - is a low-probability event. Whereas, continued selling pressure throughout the day may be the modus...
GOLDMAN SACHS BIZARRE TIMING
I always wonder if a majority of these investment banking firms are on a campaign of misinformation for nefarious reasons that will revealed by Wikileaks in the coming months or years. Perhaps it's just that the fundamental research guys that come up with recommendations to buy equities, as they did today, are not allowed to discuss things with the technical, market-timing guys. While Goldman's recommendation to buy equities for the long-term is the right recommendation given the bullish variables in favor of long-term growth in the equity markets. Their timing will be damaging to any of the investors who choose to take their advice. The tree that is the US equity markets is about to start shaking, and odds are that your average, mentally scarred investor will not be able to hang on long enough in order to enjoy the fruits of Goldman's recommendation. Just goes to show that the conflictory jungle that is Wall Street is alive and well. Analysts with fancy degrees, dressed in funny suits and ties, acting as if the knowledge of all the heavens is at their feet. When, in fact, the reality of the situation is that they are the modern day version of a carnival barker, doing work that - in the end - is truly...
THE “EARNINGS ARE BAKED IN” CROWD IS BEGINNING TO GIVE UP
This slow, steady climb is surely causing the "earnings are baked in" crowd to reluctantly throw in the towel. This was very necessary in order for the markets to begin responding to the numerous indicators that have been telling us of the fact that things are getting somewhat overheated and we are due for a break. I have reiterated that market tops in January following a previously bullish year are indeed rare. This market will not be the exception. However, the always endearing drunken chop will now be free to begin, as the long side becomes overcrowded and the bears continually attempt to find the top. Bottom line: next week will not be as smooth as this week was. We are closer to the beginnings of an extended period of consolidation, as opposed to any monstrous run up. Caution reigns...
THE MARKETS WERE BEGGING TO RUN, NOW WHAT?
If any of your senses were active, this rally shouldn't have come as a surprise at all. Come on...do I need to list all the factors begging for a move up? - Tech leading the rally...and not pulling back with the S&P, Dow. Bullish. - Commodities, which have been correlated to the equity markets, consolidating their gains in a orderly, disciplined fashion. Thereby telling anyone who bothers listening that the inflation or die trade is catching its breath. Bullish. - An abundance of professional traders putting all their eggs in the "market sentiment is too bullish" basket. Yes, it is...but it isn't gonna turn around on your clock. It's gonna do a lot of shaking and wiggling first. Pretty standard...and pretty bullish. - Doug Kass being bearish. He's very good...but in all the time I've followed him...he is ALWAYS early. Bullish. - The sentiment indicators that we follow (I will update these tonight) are just starting to get into the portion of the danger zone where the markets have a tendency to wiggle and shake in order to dizzy the bears. The market rarely flips the switch without putting on a soap opera first. Bullish. With that said...we are most definitely is soap opera mode. The market's are acting like they will go infinitely higher, when in reality, they are preparing to consolidate for a time once the January "I'm forced to allocate into stocks in order to keep my job" run comes to an end. I know of very few market runs that have topped in January...following a bullish year previously. This one isn't going to be the anomalous traitor that most seem to thing it...