Tuesday, November 3, 2009

Some Random Thoughts After Going Through My Scans

Had a little time to go through my scans for the first time in a few days and drew some quick conclusions.....
  • My list of potential longs to watch (not buy, just watch) was cut in about half over the past week from around 400 to around 200. I could have cut it much further but gave some momentum names the benefit of the doubt as it is just a list of stocks to keep an eye on. There was a LOT of damage done to individual names the past week, and I feel more confident in my statement that it will take some time to correct that damage.
  • I do see quite a few short setups right now. Several from the retailers. If you're interested in potential names, email me as I don't have time to do a video. Quite a few bear flags are setting up right below the 50 day moving average on individual stocks and those typically are juicy plays.
  • VIX is forming a little bull flag on its daily chart and that is not good for the overall market.
  • IYR is one sector I will focus on via SRS if the Fed hints at rate hikes in the future, causing the dollar to rally and the market to fall further.
  • I don't like the reversal today in the dollar and that does have me wondering about its breakout potential here. I guess it all depends on the Fed tomorrow.
  • The crude oil chart looks bullish and that is one good sign for the bulls. Nice bull flag forming on XOIL.
  • I don't have nearly as many names to watch on the long side but you do have to be prepared. If you want those names, email me.
All in all, I see some mixed signals - individual charts look more bearish right now but being oversold and holding support a bounce remains a strong possibility. What really remains a strong possibility in my opinion is some whipsaw action the next few days, much like we've seen for the past week, so be on high alert. I don't expect to get aggressive with any positions for the next few days. Take care and good luck Wednesday.


Anonymous said...

the 64K question is do you short if we get a fed rally or do you long if we get a fed selloff ??

my gut say latter

Mac said...

I tend to think the opposite - whatever reaction you get to the Fed, you go with it for at least a short-term trade. There is usually a lot of volatility, but I think we are set to move one way or the other and just waiting for the catalyst.