March 2005 Archives

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,000 will be very important in bringing out more buyers. The market's still very oversold and set to gap up this morning. That sounds like a deadly combination for the bears but I'm not so sure that's the case. (You know how I feel about gaps.) A gap down might be a better scenario to finally shake out the sellers.

Jim Cramer's posting his '25 Investing Rules' as part of a promo for his new book 'Jim Cramer's Real Money: Sane Investing in an Insane World'. So far 13 of the rules are up and he'll be adding one more each day. The rules aren't anything earth shattering but it never hurts to take a refresher course on trading rules.

I've never read any of Cramer's books, but Duru tells me that his last book was a good read so I'm gonna take his recommendation and add it to my list. (via Duru)

I was just asked what happened to my daily watchlist posts. Since I'm not doing any swing trading right now I don't see much point in posting stocks that I'm not going to actually consider trading. The swing picks will be back when I get back into swing trading mode. But with earnings season coming up it may be a few weeks before that happens. I may very well just be looking for day trades until the end of next month.

Mike, who's looking to mix in some technical analysis (TA) with his fundamental analysis (FA), sent the following:

Just getting into "trading", having been "investing" longer term in value stocks for the last few years.
My value stock mentor (he has averaged over 17% per year for years and years) looks for solid companies that for a variety of factors are undervalued. Then he either buys stocks or frequently SELLS puts. He does not even glance at the charts. Once they get cheap he buys.
I've been trying to learn TA so once we find a stock which is seemingly undervalued I can see whether it is likely strong or weak and whether to buy at that point or wait. Anyway two of his favorites right now are HD and AIG. They are both fundamentally very cheap. But, I've been watching them fall and fall over the last 4 to 6 weeks. Was wondering if you could analyze them and even let me know when a reasonable Technical bottom could be expected.

I think it makes a whole lot of sense to use FA to find what to trade (invest in) and use TA to tell you when to initiate the trade. The trick will be finding the right indicators to use that suit you. I like to use moving averages to tell me if the trend is up or down and then look for trades in the direction of the trend. That may not work well with certain value situations. For example, there's no way I would have jumped in AIG after the thrashing it took in October because I would have been bucking the intermediate and long term trends (as defined by the 50 and 200-day moving averages respectively). It rallied about 33% from the October lows to the February highs. Anybody who bought into that October slide would have certainly been looking for a contrarian/counter-trend play so using moving averages wouldn't have made much sense. Perhaps some kind of extreme oversold indicator works in those type of situations?

The market was able to withstand an attempted afternoon sell off today and closed on its highs for a change. Today's action had the major indices all closing at 6 day closing highs. Additionally the Dow and S&P 500 were able to close above the intraday resistance of the last three sessions. If I had to find one thing wrong with today's rally it would be that the volume was just a bit lower than yesterday's volume.

Worden, in tonight's report, made the following observation about the intraday charts:

I found the hourly charts exceptionally interesting as of today's close. All three of the averages broke out on the upside of a five-day base. All three had positive divergences in MoneyStream and TSV at yesterday's bottom. In doing so they all broke above their 50-hour moving averages. None of the three had been above that average since March 9. So in terms of intraday analysis this is a marked change of character. It is likely to have some Short-to-Intermediate-term legs.

A change of character indeed. Things should be very interesting going into Friday's jobs report.

Oh yeah, T2108 sprung back over 20 to close at 26.98...

Like many other traders I like to see bottoms made late in the day after several hours of what feels like endless selling. We've got an early run today which is getting close to the resistance of the last several days. Will the market roll over again at those levels? I don't know but I won't be surprised if it does. Anyway, here are some things that I read this morning that may be worth a look:

• List of Challenges for Short Sellers Keeps Growing Longer - Shorting is tough but it can also be lucrative. Some of my biggest winners over the last couple of years were on shorts.
• Stephen calls Monday's action a bull trap and lays out a scenario for a Friday climax. He also talks about what will make him (more) bullish on the market -- Price. (I was LOL when I read that 'you buy first' comment. I feel ya on that Stephen!)
• Jon, the 'Fickle Trader' ponders when oversold becomes too oversold. I have to agree that I'd rather look to sell rallies in this market instead of buying dips.
• Morningstar has a piece about finding your investing edge.
• Dave Landry has miraculously found some very bullish charts. :-)
• If you want to try out Yahoo! 360, Jeremy is giving away invitations. You can get an idea of what Yahoo 360 is by checking out Jeremy's 360 page. I'm tempted to try it out but I've already got way too many web sites.

Update: Dave informs me that he's giving Yahoo 360 invites away as well. You may get quicker response from him vs. Jeremy, who's gotten hundreds of requests. You can contact Dave at dmabe [at] runningland [dot] com.

And that reminds me, I keep forgetting to post a link to the Stock Charts FireFox extension that Dave wrote. Here's Dave's description of what it does:

I created an extension that lets you select muliple ticker symbols in a web page seperated by spaces or commas (or both) and then open a tab with a stock chart for each one. By default, you can choose from stockcharts.com, yahoo.com, or bigcharts.com. You can customize these or add your own.

Worden has an indicator called T2108 which plots the percentage of stocks above their 40-day moving averages. In effect it works as an overbought/oversold indicator for the market. This is an indicator that Duru and I like to check when we get strong moves in the market. I was just instant messaging with him about it and we were trippin' off of how fast this bad boy is dropping. This indicator doesn't spend much time above 80 or below 20. Once those levels are hit the market usually reverses pretty quickly. It hit 19.99 today... down 26% from yesterday. The chart shows just how widespread the selling is right now:

Update: To fulfill a request left in the comments below, here's another look at T2108 with data going back to late 2000, which is all the data I can get on the chart:

Well we finally got some follow through, although I suspect it was in the opposite direction than most people wanted to see. And that's exactly why I think it's necessary for the market to break down. There's still a good amount of complacency that needs to be wiped out. (Easy for me to say as I sit on a pile of cash.)

There was a lot of technical damage done today as some indices hit 4 month lows and other broke important moving averages. If you have a subscription to Briefing.com check out today's 'Swing Trader' column for some charts of several sectors. Below are charts of two of the sectors that stood out to me -- Banking and Basic Materials, which has been one of the strongest groups this year:

For the third day in a row the market has tried to rally early only to succumb to selling late in the session. The action is best seen on the Nasdaq which failed at its 200-day moving average and at the 2,000 level again.

It's starting to feel like the calm before the storm as volume keeps shrinking daily. I still think that the bulls would be better served by a 'whoosh' lower to shake out the sellers instead of these feeble rally attempts.

Nvidia sure is a popular stock -- I seem to get a request for it every other week. My outlook on it hasn't changed much since the last time I drew it up. It's showing great relative strength vs. the Nasdaq but it's real close to breaking its intermediate uptrend. NVDA looks like a short to me if it closes under 24.50 (the lows of last Tuesday and Wednesday) and a long if it can take out the mid-March highs around $26.

The Nasdaq failed at its 200-day moving average and at 2,000 during the last two trading sessions. I think that a close above 2,