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Newsletter, Members Click HereOctober 30th: It started as a promising day, but it did not end as such. I would consider this the second bearish day in a row for the markets; each day takes it one step closer to marking the top that every Tom, Dick and Harry is looking for (and may not necessarily get). Early advances didn't get the solid buying volume which has accompanied nearly every gain since the June-September bearish wedges were negated - neither were the markets able to regain lost breakouts in the tech [NASDAQ and NASDAQ 100] or small cap [Russell 2000] indices. MACD 'sell' triggers remained in effect for the tech indices, including fresh 'sell' triggers in the large cap [Dow and S&P] and small cap [Russell 2000] indices. The semiconductor index hasn't escaped the clutches of its MACD bearish divergence either. Adding to the pressure was the firming of the bearish divergence in the tech market internals [$NASI, $NAA50 and $BPCOMPQ], notably the $NAA50 and a MACD 'sell' in the $NASI; the latter confirms the 2-month old bearish divergence in the indicator. Finally, volatility looks set to jump - a dose of fear will really spook the market (no pun intended).

Target hit: none

Stop hit: EVVV hit its raised stop at the very low of the day. The stock featured as a Breakout for September 12th and October 6th, as well as a Subscriber pick for September 6th; the two Breakout plays closed for a 3% loss and a 6% loss; the Subscriber pick closed for a 9% gain. SVNT reversed its channel breakout, but did manage to close on a bullish hammer; however, this was not enough to save the position. The August 25th, October 3rd, and October 27th play closed for a 21% gain, 10% gain, and a 4% loss.

Newsletter, Members Click HereOctober 28th: Bears will have sighed some relief as Thursday's breakouts in the tech averages [NASDAQ and NASDAQ 100] reversed; the NASDAQ 100 suffering the additional indignation of a distribution day. Reversals were also experienced in large cap [Dow and S&P] and small cap [Russell 2000] indices, but neither set of losses caused any significant technical damage. There is a swathe of support to look forward too - so Bears can't be rubbing their hands with the expectation of a big reversal, but buying this dip would be a risky proposition. The semiconductor index took a step back to its 50-day MA; there is a big void of support down to July lows, so further losses could be very damaging technically. The semiconductor index is also influenced by the strengthening bearish divergence of its MACD trigger line.

Technically; the MACD trigger 'sell' holds for the NASDAQ and NASDAQ 100 - but there is no change in the other technicals; the bullish divergence in the MACD of the Dow was broken by the sideways movement of the indicator, but no 'sell' trigger yet; the Russell 2000 holds to its 'sell' trigger in CCI, but its MACD is holding to its bullish form.

The only change in the tech market internals [$NASI, $NAA50 and $BPCOMPQ] came with the bearish cross of the 5-day EMA of the $NAA50. This has started a negative divergence to the parent tech indices [NASDAQ and NASDAQ 100]; a lower low runs in contrast to the higher high made in the tech indices [NASDAQ and NASDAQ 100].

Since turning bearish for October I have advocated selling into strength, letting the next downward leg play out before looking for new long positions. I remain bearish for the Ticker Sense Blogger Sentiment Poll (since September 23rd) - although this is the second week I have been on the wrong side of the call; a 92 point gain for the NASDAQ and a 411 point gain for the Dow since the close of business on September 29th. Ticker Sense will be publishing bullish/bearish sentiment for each of its contributing bloggers on Monday. It will make for interesting viewing (for those willing to disclose this information).

Target hit: none

Stop hit: LVLT reversed its breakout to cut below $5.48 support and hit its October 18th stop price for a 12% loss. JADE hit its higher October 19th stop price for a 2% loss; the October 4th Subscriber pick closed for a 10% gain. BITS gave up its October 27th Subscriber stop price to close out the two earlier positions; the September 22nd Breakout play for a 35% gain and the October 13th Subscriber play for an 18% gain; the Thursday Subscriber play closed for a 1% loss.

Newsletter, Members Click HereOctober 26th: Thursday was the break to new yearly highs for the tech averages [NASDAQ and NASDAQ 100] as they confirmed what the tech market internals [$NASI, $NAA50 and $BPCOMPQ] had been suggesting, which was the cyclical bull market was not done. The semiconductor index also lent its weight with a close over the 20-day MA, but has some way to go before it will break it s bearish divergence. Volume climbed to register a second accumulation day in a row. The gains were also enough to realign the markets in a traditional bullish alignment with tech leading large caps, both of which are led by small caps {Small Caps > Tech Indices > Large caps}. Small caps [Russell 2000] also closed at new reaction highs, but not enough to close the index at yearly highs.

Tech market internals [$NASI, $NAA50 and $BPCOMPQ] changed little. The $NAA50 re-crossed its 5-day EMA (bullish), but maintained its MACD bearish divergence. Also holding was the ever weakening bullish strength (+DI), but increased bearish strength (-DI). However, it did reverse its breakdown of the ultimate oscillator bullish divergence. Finally, volatility looks ready to move down towards 14. This could coincide with a blow off top (and the eventual top).

Does any of this change my bearish opinion? Much as it looks like the top will not occur in October, recent gains are an opportunity to sell into strength. Stops can be trailed at previous reaction lows (on a daily chart) to give individual stocks more room to run; for many, this will be last week's lows.

Target hit: none

Stop hit: AUXL clipped its stop on an intraday basis, but was able to close above support. The stock featured as a breakout for September 18th, October 9th and October 25th. Each play closed for a 14% gain, 4% gain and a 5% loss respectively. CRS gapped down on heavier volume as it reported a profit miss. The stock featured to Subscribers for August 29th and as a Breakout for September 19th and October 13th. The Subscriber pick closed for a 11% gain, the Breakout plays for a 1% gain and a 6% loss. CVD was killed on earnings and a downgrade. The stock featured as a Breakout for July 19th and September 11th. The former play closed for a 1% loss, the latter a 4% loss. DFG was exited on Wednesday on a stop hit. The stock featured for as a Breakout for July 27th, September 12th and October 16th. Each play closed for a 6% gain, breakeven, and a 4% loss respectively. ICLR reversed its most recent breakout. The stock featured for July 14th, August 8th, and October 25th. The plays closed for a 25% gain, 6% gain, and a 6% loss. JUPM hit its stop. The stock featured only once for October 18th, and closed for a 12% loss. NWL suffered a large intraday swing to hit its raised stop. The stock first featured to Subscribers for July 18th, October 17th and October 25th, and as a Breakout for July 28th, September 1st, and September 12th. The three Subscriber picks closed for a 17% gain, a 3% loss, and a 3% loss. The three Breakout plays closed for an 8% gain, a 6% gain, and flat.

Newsletter, Members Click HereOctober 24th: All eyes will be on Wednesdays Fed meeting; so Tuesdays action was relatively limp. The issues of note were few: [1] A bearish harami on higher volume in the NASDAQ and NASDAQ 100. The haramis followed another day of losses in the semiconductor index. The technical damage in the latter index continues to increase and the bearish divergence in the MACD trigger line is as good as set as it dropped below the bullish zero line. [2] The Russell 2000 was able to regain its momentum against tech indices [NASDAQ and NASDAQ 100] - Small caps once again lead the market, negating some of the bearishness of yesterday. Unfortunately, the large caps [Dow and S&P] also stepped over the tech indices [NASDAQ and NASDAQ 100] and are close to jumping the small caps to complete a strong bearish alignment, so it is not all running in the bulls favor {Small Caps > Large Caps > Tech Indices}. [3] The biggest change came in the tech market internals [$NASI, $NAA50 and $BPCOMPQ]; the $NAA50 took a big step down as the bearish divergence in the MACD trigger line strengthened and the Ultimate Oscillator lost support of its May-October bullish divergence. Also coming on line is a similar bearish divergence in the MACD of the $NASI. The May-June-July bullish divergences created in supporting technicals of tech market internals during the summer provided an excellent buying opportunity - one would have a strong argument to suggest the counter bearish divergences taking shape in this indicators is a strong selling opportunity. Time to take advantage of this before the Fed spoils the party?

Target hit: none

Stop hit: DTLK hit its raised stop from October 10th. The stock first featured for Subscribers on July 25th and again for September 14th. The Subscriber plays closed for a 21% gain and a 2% gain respectively. The breakout play closed for an 8% loss. ISIS suffered its third day of declines to hit its October 20th Subscriber pick stop price for a 7% loss. WRLD featured as a Subscriber pick for July 25th and October 13th. The former play closed for a 21% gain, the latter a 4% loss.

Newsletter, Members Click HereOctober 23rd: Large caps [Dow and S&P] logged the bulk of Monday's gains as other indices rose in sympathy; all on lighter volume. The gains were insufficient to reverse a MACD trigger 'sell' in the NASDAQ or NASDAQ 100; but tech indices [NASDAQ and NASDAQ 100] did enough to gain the upper hand on small caps [Russell 2000] in terms of relative strength. This re-aligns the market in a more bearish stance {Tech indices > Small Caps > Large caps}. Tech indices [NASDAQ and NASDAQ 100] and small caps [Russell 2000] have yet to confirm new highs for the year, leaving them vulnerable to a more substantive reversal than a typical downward swing. However, "Golden Crosses" (bullish cross of the 50-d/200-d MAs) in all of these averages is a long term bullish signal, negating the May bearish "Death Crosses". Breakouts in these indices could see matching gains of 4%+ as occurred in large caps [Dow and S&P]. Tech market internals [$NASI, $NAA50 and $BPCOMPQ] were unchanged from Friday.

Target hit: GOOG featured for Subscribers on May 22nd and as a Breakout for October 9th. The former play closed for a 28% gain and the latter a 13% gain.

Stop hit: WBS hit its stop by 2 cents but closed on bullish engulfing pattern. The October 18th Breakout play closed for a 2% loss. TRAD featured to Subscribers for October 4th ans as a breakout for October 9th. The former play closed flat, the latter for an 8% loss.

Newsletter, Members Click HereOctober 21st: A relatively boring week with markets retaining bullish rising channels (August-October). Where weakness crept in was a MACD 'sell' trigger in the NASDAQ as other technicals remained firm - on-balance-volume in particular supports a solid accumulation trend. The other change came in the Dow as it lost some ground (in terms of relative strength) to the NASDAQ 100. Volume climbed to register a distribution day/bearish churning on a "spinning top doji" (equal open/close with long tailed shadows - i.e. a large range between days high/lows and open/close). On-balance-volume in the Dow still favors accumulation, but its MACD trigger line is hugging tight bullish divergence support and is only a short tick away from generating a breakdown. The semiconductor index lost the 50-day MA as support, but held former bull flag resistance as support. The bearish divergence in the MACD trigger line deepened as intermediate term slow stochastics [39,1] dropped into bearish market territory. Further weakness looks likely until all slow stochastics reach oversold levels.

As for tech market internals [$NASI, $NAA50 and $BPCOMPQ]; the $NAA50 switched to a bearish cross of the 5-day EMA as its ultimate oscillator dropped below 70. There is a risk of a bearish divergence developing in the $NAA50, but support should appear when it reaches 1,250. There was no change in the $NASI and $BPCOMPQ. Finally, volatility dropped below 17, a support level on four previous tests. A move to 15 looks likely, but it could follow with a large drop in the market on a resulting surge in volatility.

I have kept my bearish stance in the Ticker Sense Blogger Sentiment Poll since September 23rd - given the NASDAQ has added some 110 points and the Dow some 470 points over this period it hadn't been the smartest of calls - but a downward spell can't be long in the offing and I remain bearish until we reach a level when tech market internals [$NASI, $NAA50 and $BPCOMPQ] are oversold.

Target hit: none

Stop hit: DE gapped down after Caterpillar cut guidance. The stock featured as a Free Breakout for September 27th and October 10th and to Subscribers for August 15th and September 1st. The two Breakout plays closed for a 1% gain and a 5% loss and the Subscriber picks for a 22% gain and a 7% gain respectively.

Newsletter, Members Click HereOctober 19th:Get out the bunting; we have a 12K Dow. Given the attention, it was as much as one could say about the markets Thursday. The Russell 2000 managed to push some upside; its proximity to resistance could be good for breakout buyers if it can build on the gains. Small caps are of key importance for the health of this rally. The semiconductor index was able to stall out at its 50-day MA, holding this thin line of support for another day. Tech indices [NASDAQ and NASDAQ 100] will have taken some comfort from this. It's still all to play for.

Tech market internals [$NASI, $NAA50 and $BPCOMPQ] all gained, but there is a worry of a bearish divergence taking shape in the MACD trigger line of the $NASI, and to a lesser degree in the $NAA50 too (although there is a chance this one could work itself through to new highs - thus negating the divergence; the $NASI is unlikely to get the chance to do likewise).

Target hit: none

Stop hit: LUV crashed through its stop in one of the few poor performers on the day. The September 27th Subscriber pick closed for a 4% loss. NEW hit its stop after gapping down on a downgrade by Friedman Billings. The September 25th Subscriber pick closed for a 4% loss.

Newsletter, Members Click HereOctober 18th: The bulls channeled all their power into a 12K Dow push, but it came at the expense of the other indices - the semiconductor index in particular. But even this wasn't enough to close the index above 12K. However, relative strength in the Dow was enough to push it ahead of the NASDAQ 100, which (unfortunately) is bearish for the market as a whole.

What of the semiconductor index? It finished on two thirds of a potential "three black crow" candlestick combination (basically - 3 down days in a row; a reversal pattern). But where it struggled was its fresh 'sell' trigger in the MACD and new Sep-Oct bearish divergence. The semiconductor index also finished on the 50-day MA after slicing through the 20-day MA. This followed from a second failed test to break the 200-day MA. If the 50-day MA gives way there is a big void of support down to 385 (15% away). Keep an eye on the index.

The impacts of further weakness in the semiconductor index would be felt in the NASDAQ 100 and eventually the NASDAQ. The NASDAQ 100 did suffer along with the semiconductor index after it flashed a bearish engulfing pattern on a second distribution day in a row. However, it still has channel support to look forward too, not to mention all three key moving averages (20-, 50-, and 200-day MAs). The Russell 2000 held resistance of its rising channel but technically remained unchanged. The S&P is in an either/or situation with higher volume gains marking accumulation - or bearish churning given the index only gained a couple of points.

Tech market internals [$NASI, $NAA50 and $BPCOMPQ] remained in a bullish alignment. Only the $NAA50 registered a 'sell' trigger in the Ultimate Oscillator - but the larger picture of the $NAA50 remains intact.

Target hit: none

Stop hit: AGR was a Subscriber pick for October 4th and a Breakout for October 16th. The stock was able to close on a bullish hammer above the 20-day MA, but finished below breakout resistance. The former play closed for a 9% gain, the latter a 5% loss. ALB clipped its latest stop by 1 cent - but it too closed on a bullish hammer (it looks in better shape than AGR). The stock featured as a Breakout for July 26th and October 13th. The July feature closed for a 9% gain and the latter a 3% loss. BSTE featured to Subscribers for April 26th and more recently on October 16th. The revised stop closed the 2 positions for a 16% loss (never average down!) and a 3% loss. The 200-day MA still holds as support.

Newsletter, Members Click HereOctober 17th: It should have been no surprise to see the markets down as they confirmed "Advancing Block" patterns (a series of 3 white candlesticks, which unlike the regular Three White Soldiers of consecutive long white candles, has a sequence of decreasing sized white candles). It is too early to say if this is anything more than a respite from recent gains, but the higher volume does mark it as a distribution (bearish) day. Markets won't tolerate too many of these. For the majority of markets (other than the Dow and NASDAQ 100) this was the second distribution day to occur over the last five days. It is these heavier volume days that say more about the health of the market than the ramblings of a 12K Dow.

As for resistance, there was a reversal off the 200-day MA for the semiconductor index as it dropped outside of its former channel (which looks history now). The Russell 2000 flashed a bearish harami cross at channel resistance, but confirmation will be needed with a close below 2-day (Monday/Tuesday) lows. The NASDAQ came back from the crutch of resistance set up by its rising channel and May resistance - so no surprises there. All indices have plenty of support to look too.

The good news for the bulls was the ability to push markets back towards their highs in late afternoon trading. Also good news is the neutral territory occupied by the tech market internals [$NASI, $NAA50 and $BPCOMPQ]. Having cleared secular bear resistance levels the tech market internals have some room to run to (cyclical/bull) market levels, even as they start to stall at their current levels. Tomorrow is another day.

Target hit: ITMN jumped above its price target into a fresh breakout. If it can hold $20.50 support I would look for a measured move to $28, which is also a 2003 high. For my purposes, the play is considered done; the June 27th Subscriber play closed for a 45% gain; the August 29th Breakout play closed for a 24% gain. ODP was a Subscriber play from September 15th. It hit its target price for a 13% gain.

Stop hit: SUMT stop was hit yesterday (I missed that one). The September 28th Breakout play closed for a 10% loss. ASD was a Subscriber pick for August 31st. The stock broke below Aug-Oct support on an open gap, to register the play for an 1% gain.

Newsletter, Members Click HereOctober 16th: The Dow fell short of the magical 12K by 3 ticks - once it hits this level will it be a 'sell the news' situation? Luckily, the real market drivers; small caps [Russell 2000] and Tech [NASDAQ and NASDAQ 100], had another good day. Both the Russell 2000 and NASDAQ are at channel resistance - so it would be logical to expect a reversal, but this may not be necessarily so and given their recent performance, a break of their respective resistances could be on the cards. Both tech averages [NASDAQ and NASDAQ 100] could see new yearly highs and a continuation of the cyclical bull market sequence of higher lows and higher highs.

Technically, there was little change in the markets. The semiconductor index now outperforms the NASDAQ 100 on a relative strength level, with the NASDAQ 100 underperforming small caps [Russell 2000], in line with the NASDAQ performance to small caps. The semiconductor index did see a MACD 'buy' trigger, but closed 2 ticks shy of the 200-day MA at 477.35; which will prevail?

The tech market internals [$NASI, $NAA50 and $BPCOMPQ] enjoyed the biggest change; the $BPCOMPQ and $NASI sharply advanced. Even the low gain $NAA50 was able to register a breakout of its MACD bearish divergence - although the strong performance of the $NAA50 is tempered by the continued bearish performance of its CCI. Volatility is the other potential spoil sport as it closed with a bullish hammer above its 200-day MA. Bulls are in charge - but each passing day weakens their cause (as market internals approach bull market overbought levels).

Target hit: none

Stop hit: none

Newsletter, Members Click HereOctober 14th: Very little to add to Thursday's post. Markets are overbought - but could stay this way as they bump along ever higher. The good news for bulls is the various trend channels in play across all the key indices listed on my public stockchart list. The biggest shift was in the most current (most bullish) alignment of the markets with small caps [Russell 2000] now leading Tech [NASDAQ] - {Small cap > Tech Indices > Large cap}.

 

The chief change elsewhere was the new MACD 'buy' trigger in the semiconductor index, combined with a resistance break of the bearish divergence in its CCI. The index trades inside its former rising channel and is well positioned to climb higher. There should be enough momentum to see the upper part of the channel at around 510; only the 200-day MA at 477 could spoil the party.

Tech market internals [$NASI, $NAA50 and $BPCOMPQ] increased their rate of ascent, but having cleared cyclical bear market reversal zones they now have plenty of room before encountering resistance levels associated with bull markets. Volatility could be the early warning system for a decline - the small bullish harami cross sets up a fear spike for Monday/Tuesday - whether that builds into something more fearful will remain to be seen.

Target hit: none

Stop hit: none

Newsletter, Members Click HereOctober 12th: Bulls kicked it up a notch across all fronts. More importantly, it reinstated the bullish market conditions in the tech market internals [$NASI, $NAA50 and $BPCOMPQ] which had been lingering (and possibly reversing) at bear market levels. Tech markets [NASDAQ and NASDAQ 100] still need to confirm this strength with breaks of May highs (in order to prevent a lower high, lower low sequence - which would kick off a new cyclical bear market), but things are looking much better for the NASDAQ and NASDAQ 100. The bull flag break in the semiconductor index, even if it sits at resistance of its CCI and former upward price channel, should be enough to keep things buoyant for next week and provide support for the NASDAQ and NASDAQ 100, the NASDAQ 100 in particular . Large caps [Dow and S&P] hold the new high stakes as the "magical" 12K fast approaches in the Dow, but do not be distracted by the stronger relative strength of Tech averages [NASDAQ and NASDAQ 100] to Large cap indices [Dow and S&P] - even if the hype operates in reverse. Strong bull markets have weaker large cap stocks, so far this has held true for this rally. It's what happens in the small caps and tech indices, not the Dow, which needs to be monitored.

Technically, there was some improvement in MACD trigger lines of all indices - but each are vulnerable to 'sell' triggers by simply a couple down days in their parent indices. Short term [14,3] and intermediate term [39,1] stochastics converged at overbought levels for both the Dow and S&P - it doesn't necessarily mean a reversal, but a repeat of the break-and-retrace as seen at the start of September should not be ruled out at this juncture - the first half-hour of Friday's trading will set up the boundaries of such a trade.

As for the magical tech market internals [$NASI, $NAA50 and $BPCOMPQ]; there were magical MACD 'buy' triggers in the $BPCOMPQ and $NAA50. The latter has some 300 points to run into typical resistance at tops - the former has a good 20 points (which could take 3 months to pass) before it runs into bull market top levels. The $NASI is in the ascendancy once more and has 400 points before it reaches bull market top territory - having surpassed bear market top territory by 100 points.

The potential spanner in the works for bulls is volatility. When it dipped below 15 in May, part of a bear 'head-fake' of a large consolidation triangle, it followed with a huge counter surge corresponding to the big correction in the indices. A similar event does not appear far from repeating itself here - which is one reason I am sticking to a top in October theory. I would be happy to be wrong, but if you are bullish you don't want to be getting ahead of yourself; 12K in the Dow will mean little if 10K comes before 13K.

Target hit: none

Stop hit: FL clipped its stop intraday. The stock featured to Subscribers for September 25th and closed for a 2% gain.

Newsletter, Members Click HereOctober 10th: Another accumulation day in a market which spent most of the day churning. There hasn't been a distribution day in almost 6 weeks for the S&P, 4 weeks for the NASDAQ and Dow, and 2 weeks for the NASDAQ 100. It will be interesting to see how the markets react once sellers make a re-appearance. Technicals remained bullish (but weakening), but there were no important breaks to report. In my charts I have added new upward price channels (see my public Stockchart.com list for details).

The tech market internals [$NASI, $NAA50 and $BPCOMPQ] have started to break from their potential bear market slumber (i.e. break of resistance levels commonly associated with bear markets, chiefly - '0' for the $NASI and 50 for the $BPCOMPQ) which should help tech averages push higher. However, markets are still waiting for new reaction highs in the tech averages [NASDAQ and NASDAQ 100] and the Russell 2000. Without these developments the large cap rallies are swimming against the tide.

Target hit: NEOL featured as a Breakout for October 3rd. The stock reversed off the 200-day MA, but not before hitting its target price for a 25% gain. ACTU was a Subscriber pick for September 8th. It hit its target price for a 19% gain.

Stop hit: IDTI was a Subscriber pick for today, but was a too tight on the stop and it exited for a 3% loss.

Newsletter, Members Click HereOctober 9th: No change from Friday as light holiday trading kept things simmering. Looking for market internals [$NASI, $NAA50 and $BPCOMPQ] to improve if a more substantial rally is to work from here.

Target hit: none

Stop hit: none

Newsletter, Members Click HereOctober 8th: Well, it was a week when the large caps [Dow and S&P] broke to new highs and (more importantly) were able to retain those highs. Also benefiting were small cap [Russell 2000] stocks which pushed past 735 resistance (5-month resistance) and held these levels into the weeks close. The tech averages [NASDAQ and NASDAQ 100] still have work to do to breach resistance, the semiconductor index struggled the most in the face of net gains for the markets - shaping a new, mini-downward channel out from the previously (larger) upward channel. However, in terms of relative market strength - Tech leads the way {Tech > Small Caps > Large caps = net bullish and strengthening}.

Technically, there was a fresh 'buy' trigger in the Russell 2000 and new highs in on-balance-volume for the Dow and S&P.

Market internals [$NASI, $NAA50 and $BPCOMPQ] were interesting because of their mixed messages; the $BPCOMPQ pushed beyond resistance of 48, reversing a 'sell' trigger in its Ultimate Oscillator - but not a similar trigger in its MACD. The $NAA50 looked ready to blast past 1,250 resistance, but again it has found trouble at this important resistance level - technically, it too remains weak. The $NASI regained the 5-day EMA and its Ultimate Oscillator found support at its Jun-Oct bullish divergence, but its MACD is on a 'sell' trigger which looks to be increasing in bearish strength. Finally, volatility is only a few ticks away from support at 16 (major support at 14). The volatility cat-in-the-bag was released in May and I suspect the period of low volatility which had been running from early 2003 is close to over.

For followers of the Ticker Sense Blogger Sentiment Poll, I remain bearish over the next 30-days.

Target hit: none

Stop hit: none

Newsletter, Members Click HereOctober 5th: Because Hawaiian Road Runner was down for three hours it is only a quick update for tonight. Markets did well to hold on to Wednesday's gains - even if volume declined substantially to the prior day's strong accumulation. The Russell 2000 was the most interesting as not only did it regain prior channel support, but it also managed a push through 735 resistance - a cap level of resistance for the last 5-months.

Technically, there were returns for MACD trigger 'buys' in the NASDAQ and NASDAQ 100, although the semiconductor index was unable to regain channel support and remains technically weak. Tech market internals [$NASI, $NAA50 and $BPCOMPQ] were the other big gainers on the day as both the $BPCOMPQ and $NAA50 crossed above their 5-day EMAs, the $NAA50 managing to create a bear trap in the process. Technically, there was little change in these indicators, but further gains would go some way to correcting the damage in these supporting market internals.

Target hit: not checked

Stop hit: not checked

Newsletter, Members Click HereOctober 3rd: Large caps [Dow and S&P] played a picture perfect test of support on higher volume, to mark a resumption of their uptrends. It was a close call for these indices and each day raises the stake as the marker for support increases daily. Technicals still run in favor of the bulls, but the weakening MACDs of each index should give pause for concern.

Tech indices [NASDAQ and NASDAQ 100] were also able to enjoy accumulation days. But one of the chief contributing indices to their strength, the semiconductor index, failed to join the fun - instead, it confirmed a break of channel support. In addition, the lack of technical support as represented by earlier MACD 'sell' triggers and declining +DI (= weakening bullish strength) undermines the bullish thesis for these indices.

The Russell 2000 is wedged between the 50-day MA and 200-day MA, changing little on yesterday, but was unable to generate strength in supporting technicals as the index diverges away (in terms of relative strength) from the other indices. Bulls should be concerned - no strong rally was built on large cap stocks alone.

Also running in the bears favor was the final bearish reversal in the tech market internals [$NASI, $NAA50 and $BPCOMPQ] as the $BPCOMPQ cut below its 5-day MA, accompanied with a 'sell' trigger in its MACD (following Monday's 'sell' trigger in the CCI). The ultimate oscillator of the $NAA50 also lost its bullish divergence dating back to May. Bit-by-bit, tech market internals crumble.

Target hit:

Stop hit: CRY teetered too close to its raised stop price and looks set for a drop to its 50-day MA. The stock featured to Subscribers on June 27th and as a Breakout for July 14th, September 1st and September 11th. The plays closed for a 27% gain, 11% gain, 7% gain and a 2% loss respectively. TMX gapped down into its stop on weakness in Mexico 'Blue Chip' stocks. The stock featured to Subscribers for July 19th and a Breakout for September 29th. The former closed for a 12% gain, the latter a 2% loss. AMLN was a Subscriber pick for September 28th. The stock lost support to close for a 6% loss. BVN was another to struggle at support, breaking below the 200-day MA and into its stop. The September 22nd Subscriber pick closed for a 7% loss. CTSH clipped its stop at the lows. The August 4th Subscriber play closed for a 2% gain, the August 29th Breakout play closed flat and the September 15th play closed for a 2% loss. ENZ fell outside of its potential bullish reversal head-and-shoulder pattern. The September 25th Subscriber pick closed for a 4% loss. IMCL cracked support after a series of heavier volume selling days. The August 14th Subscriber pick closed for a 3% loss. MXWL suffered its third day of selling in a row, to complete a bearish "three black crow" sequence of candlesticks. The September 29th Subscriber pick closed for a 12% loss. VLI dropped sharply through its 200-day MA to run into its stop price. The September 28th Subscriber pick closed for a 1% loss.

Newsletter, Members Click HereOctober 2nd: Bears staged another afternoon sell off, enough to crack the tech indices to a point when they are no longer the lead indices (in terms of relative strength). Both the NASDAQ and NASDAQ 100 produced 'sell' signals in their MACDs. Although the 200-day MAs of these indices have yet to be tested. The same could not be said for the Russell 2000, which broke below channel support and closed a shade below the 200-day MA. Also breached was the 4-month bullish divergence in the MACD trigger line. The semiconductor index closed a shade below channel support, but perhaps not enough to confirm it as a break - but it is not in a position to tolerate further declines. Large cap indices [Dow and S&P] did not escape the selling, but there was no technical break as nearest support held.

The other losers on the day were tech market internals [$NASI, $NAA50 and $BPCOMPQ]. The $NASI crossed below its 5-day EMA on increased weakness in its MACD and CCI (the latter indicator in particular). The reversal from around the zero mark is a concern, since prior bearish reversals have occurred from this level. The $BPCOMPQ lies in a similar predicament as it marks a reversal off bear market resistance of 50. Its CCI triggered a 'sell', although other supporting indicators held. The worst hit was the $NAA50 as it breached pennant support, reversing strongly off 1,250 resistance on increased weakness in supporting technicals (-DI in particular, not to mention the break of 5-month bullish divergence in the CCI).

The behavior holds with my thesis for an October top - but a lack of new reaction highs in Tech and Small caps would be of greater concern. Tech market internals are close to overbought territory - unfortunately, the parent indices still have some way to go.

Target hit: MYOG soared after its buyout offer. The August 9th Subscriber pick and August 30th Breakout pick closed for a 66% gain and 47% gain respectively.

Stop hit: GIGM hit it stop after gapping down on heavier volume. The September 8th Breakout play closed for a 15% loss. ORB suffered its third day of selling to close below its highest stop price, that of September 15th, and the 50-day MA. The stock also featured as a Breakout on July 21st and September 5th. The three plays closed for a 6% gain, a 1% loss, and a 5% loss. AZPN featured as a Subscriber pick for September 28th but crashed through support to register a 13% loss. PETD lost its gap support and the 200-day MA. The September 22nd Subscriber pick closed for a 3% loss.

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