Thursday, November 11, 2010

State of the Stock Market - 11/10/10 - "A Little Worrisome"

Not a very good day today on Wall Street, as poor earnings from Cisco pushed the Nasdaq down at the open and the rest of the market followed suit.   There was good news in the fact that dip buyers once again came in to push stocks up off their opening lows.   That push, however, lost some steam in the afternoon and although stocks finished well off their lows, they still finished with losses, losses that came on heavier volume (at least on the Nasdaq). 

Technically, things are starting to get a bit dicey, but the bulls did hold on overall once again today.   We've now had two distribution days in the last three sessions on the Nasdaq and that is never something you want to see.   Some distribution is normal in an uptrend, especially in one as strong as this one has been.   You don't like to see the distribution pocketed so closely however - any more and I would start to get more bearish or at least neutral instead of bullish.

The 9 day moving averages held once again so as I have been preaching, the trend remains up.   At the same time, I think we've had four to five days of pullback now, and I want to see the bulls push this back up soon.  Otherwise, perhaps this pullback lasts longer and turns into more of a intermediate-term consolidation.   As of now, I am still bullish and actually bought a few things today (KH and SHZ).   I won't hold them long however if we see much more selling.

In terms of individual stocks, there were some moving today like MMYT and HTHT, two stocks I tweeted about a few days ago as potentially putting in bottoms.   I actually entered MMYT on Tuesday but was stopped out that day - kicking myself today.  I continue to deal poorly with trying to trade without total access to the market all day (because of my full-time job).   There have been some really big winners posted here (either on the videos or on Twitter) the past few weeks, but I've seemed to get into the ones that haven't worked, like ASTI (which I was stopped out of above $4 today).   PUDA (mentioned in last week's video) is now up over 50% from when I showed it.  Alas, I could not get in it and didn't benefit - hopefully someone did.  

Overall, I would say to remain cautiously bullish here.   The dollar has put in quite the bounce here but is moving up into resistance and a pullback there will likely push the market back up.   Be careful with what you do and respect your stops, but things still look all right - the bears still haven't taken control of this market.   Good luck Friday.

No comments: