Related Stocks:  NOK, VMI

I have bought those too early as the commodities reversal came after the Oil inventory report.

C.E stocks are still the best stock and I would load up ALL their calls instead.

Anyway, these are my buys.

Related Stocks:  AGU, APWR, VISN

Market Outlook

Market Trend: (Short Term)
UpTrend
(Buy stocks out of downtrend line and Short the Downtrend stocks only)

UpTrend Sectors :
Energy, Commodities related, Financial related, Health, Transportation
Homebuilders, Industrials, Retails & other consumer discretionary
DownTrend Sectors : None

Crude oil prices were up but market stay up ?

The market was up while Crude oil prices made a strong comeback ! This is a signficant action as market was able to look objectively at the stock prices based on earnings rather than on volatile oil prices.

This unusual relationship make it hard for any swing traders to stay with their trade. The earning seasons came at a right time !

It has been a long time that all the major sectors were able to move up together. This was what the market to substain a strong rally.

I will still keep my comments short waiting for the key GDP numbers today.

Regardless of the numbers, I am still slightly biased on the uptrend as the oversold commodities/energy stocks(C.E) will fired up the buying power for the market regardless of the numbers.

Remember the March bear market rally was fired up by the overbought commodities !

A key reversal day for commodities

C.E stocks were undoubtly oversold with the high volume selling the past few days. Yet we could not see the buying power to mark the reversal.

Today action was that key reversal buying we wanted for the C.E stocks.

Related Stocks:  DBC, OIH, SDS, SPY, XLE

Related Stocks:  NOK, VMI

I have bought those too early as the commodities reversal came after the Oil inventory report.

C.E stocks are still the best stock and I would load up ALL their calls instead.

Anyway, these are my buys.

Related Stocks:  AGU, APWR, VISN

Market Trend: (Short Term)
UpTrend
(Buy stocks out of downtrend line and Short the Downtrend stocks only)

UpTrend Sectors :
Energy, Commodities related, Financial related, Health, Transportation
Homebuilders, Industrials, Retails & other consumer discretionary
DownTrend Sectors : None

Financials (+2.01%), Tech (+0.52%), Health Care (-0.08%), Consumer Staples (+1.04%), Consumer Discretionary (+0.40%), Industrials (+1.53%), Energy (+5.59%), Telecom (+0.70%), Materials (+2.84%), Utilities (+1.45%).

Crude oil prices were up but market stay up ?

The market was up while Crude oil prices made a strong comeback ! This is a signficant action as market was able to look objectively at the stock prices based on earnings rather than on volatile oil prices.

This unusual relationship make it hard for any swing traders to stay with their trade. The earning seasons came at a right time !

It has been a long time that all the major sectors were able to move up together. This was what the market to substain a strong rally.

I will still keep my comments short waiting for the key GDP numbers today.

Regardless of the numbers, I am still slightly biased on the uptrend as the oversold commodities/energy stocks(C.E) will fired up the buying power for the market regardless of the numbers.

Remember the March bear market rally was fired up by the overbought commodities !

A key reversal day for commodities

C.E stocks were undoubtly oversold with the high volume selling the past few days. Yet we could not see the buying power to mark the reversal.

Today action was that key reversal buying we wanted for the C.E stocks.

Related Stocks:  GDP

Here are a few stocks from the sectors I am looking at.

Sister stocks: SOHU, SINA

Sister stocks: AMR, LUV

Sister stocks: PCX, ACI, MEE

Sister stocks: FRE, GS, LEH, IBN

Sister stocks: TSO

Related Stocks:  BIDU, CAL, FNM, JRCC, VLO

Market Trend: (Short Term)
UpTrend
(Buy stocks out of downtrend line and Short the Downtrend stocks only)
UpTrend Sectors :
Financial related, Health, Transportation, Homebuilders, Industrials, Retails & other consumer discretionary
DownTrend Sectors :
Energy, Commodities related

A short term reversal in place

Market make a point to stop its consecutive selling days with a rather convincing higher volume reversal. DOW was up 266 points forming a nice bullish engulfing to signify that market is interested to go up.

The earnings have been rather good taking expectation of the high energy costs and financial crisis. Thanks to globalization. If we do get a positive US GDP number, it might paved the way for market to go higher for the next few months.

Oil stocks continued their selling with a lower crude price while the rest of the commodities (esp Coal and Steel) are showing signs of buying with better earnings coming out.

Until the oil stocks clear the majority of the buyers who attached their value to crude price, they might continued to go down. It might only be possible when Oil crude prices bottomed.

I have mentioned that commodities are likely to exhaust their selling with the last few high volume selling. All we need now is a rush of buying power to break their downtrend line and we will have the real leaders pushing the market up.

The current leaders on the move are health and biotech stocks. Many of their A class earning stocks are making new highs. So catch on their dips while you can ! They move real fast.

Related Stocks:  SDS, SPY

Here are a few stocks from the sectors I am looking at.

Sister stocks: SOHU, SINA

Sister stocks: AMR, LUV

Sister stocks: PCX, ACI, MEE

Sister stocks: FRE, GS, LEH, IBN

Sister stocks: TSO

Market Trend: (Short Term)
UpTrend
(Buy stocks out of downtrend line and Short the Downtrend stocks only)
UpTrend Sectors :
Financial related, Health, Transportation, Homebuilders, Industrials, Retails & other consumer discretionary
DownTrend Sectors :
Energy, Commodities related

A short term reversal in place

Market make a point to stop its consecutive selling days with a rather convincing higher volume reversal. DOW was up 266 points forming a nice bullish engulfing to signify that market is interested to go up.

The earnings have been rather good taking expectation of the high energy costs and financial crisis. Thanks to globalization. If we do get a positive US GDP number, it might paved the way for market to go higher for the next few months.

Oil stocks continued their selling with a lower crude price while the rest of the commodities (esp Coal and Steel) are showing signs of buying with better earnings coming out.

Until the oil stocks clear the majority of the buyers who attached their value to crude price, they might continued to go down. It might only be possible when Oil crude prices bottomed.

I have mentioned that commodities are likely to exhaust their selling with the last few high volume selling. All we need now is a rush of buying power to break their downtrend line and we will have the real leaders pushing the market up.

The current leaders on the move are health and biotech stocks. Many of their A class earning stocks are making new highs. So catch on their dips while you can ! They move real fast.

I got into 1 today.

Other stock you can look into : GMXR, EAC, PQ

Related Stocks:  EAC, GMXR, PQ, XTO

Market Trend: (Short Term)
Uptrend
(Buy stocks out of downtrend line and Short the Downtrend stocks only)
UpTrend Sectors :
Financial related, Health, Transportation, Homebuilders, Industrials, Retails & other consumer discretionary
DownTrend Sectors :
Energy, Commodities related

Sector performance (% change on day): Financials (-0.60%), Tech (+1.57%), Health Care (+0.64%), Consumer Staples (-0.06%), Consumer Discretionary (-0.38%), Industrials (+0.69%), Energy (+1.00%), Telecom (-0.74%), Materials (+0.92%), Utilities (-0.62%).

Favorable market news

Plenty of market moving news today which is bias on the upside.

1. Durable goods orders make surprise increase
2. New home sales better than expected
3. Earnings generally upbeat
4. Oil prices head lower

A flat low decision day

However the market didnt react too strongly to the favourable news and ended up a low volume indecision day.

The only consolation is that the mass selling yesterday was not continued so the mini-uptrend in progress is still intact.

And it is not unusual to see a small bar action(indecision- a possible reversal)
after a big sell-off.

In fact, that’s what we technical traders want to see !

Commodities and Energy (C.E) trend

The charts of XLE and DBC didn’t reflect any confirmation that the reversal is coming like I wanted. All I can see is a mass volume sell off followed by indecision bars.

Market might be waiting for the earnings of its counterparts.

Next week we will have a better idea and market will also soon realise that the commodites/energy stocks are the leaders of this market.

The C.E components in the DOW will get a boost and finally we might have all the sectors moving together for a powerful upcoming rally.

As of now, C.E stocks are not a good shorts until we can see weakness again.

Have a nice weekend !

I got into 1 today.

Other stock you can look into : GMXR, EAC, PQ

Market Trend: (Short Term)
Uptrend
(Buy stocks out of downtrend line and Short the Downtrend stocks only)
UpTrend Sectors :
Financial related, Health, Transportation, Homebuilders, Industrials, Retails & other consumer discretionary
DownTrend Sectors :
Energy, Commodities related

Sector performance (% change on day): Financials (-0.60%), Tech (+1.57%), Health Care (+0.64%), Consumer Staples (-0.06%), Consumer Discretionary (-0.38%), Industrials (+0.69%), Energy (+1.00%), Telecom (-0.74%), Materials (+0.92%), Utilities (-0.62%).

Favorable market news

Plenty of market moving news today which is bias on the upside.

1. Durable goods orders make surprise increase
2. New home sales better than expected
3. Earnings generally upbeat
4. Oil prices head lower

A flat low decision day

However the market didnt react too strongly to the favourable news and ended up a low volume indecision day.

The only consolation is that the mass selling yesterday was not continued so the mini-uptrend in progress is still intact.

And it is not unusual to see a small bar action(indecision- a possible reversal)
after a big sell-off.

In fact, that’s what we technical traders want to see !

Commodities and Energy (C.E) trend

The charts of XLE and DBC didn’t reflect any confirmation that the reversal is coming like I wanted. All I can see is a mass volume sell off followed by indecision bars.

Market might be waiting for the earnings of its counterparts.

Next week we will have a better idea and market will also soon realise that the commodites/energy stocks are the leaders of this market.

The C.E components in the DOW will get a boost and finally we might have all the sectors moving together for a powerful upcoming rally.

As of now, C.E stocks are not a good shorts until we can see weakness again.

Have a nice weekend !

A massive capitulation swept the entire stock market in a few days forcing out many sellers. Another “big discount” made on the market prices. This is just how historical bottom has been made.

The market is a funny place where the majority is always wrong.

So just when all the oversold sectors are ready to climb out of the downtrend line, the leaders stalled.

The market cannot substain an uptrend without its “leaders” .
Leaders are stocks that made investors dreamed and excited.

Just Who are they?

They are the commodities/energy (C.E) stocks.

C.E stocks provide the idealist prospects from a global C.E demand. They have the abilities to beat earning estimates quarterly/annually without much sweat. The global demand of commodities are rising every year and will not stop until China & India peaked or people stop making babies ! .

The Tech and Financials are unable to be the leaders. The economic conditions are not helping them.

Unfortunately C.E stocks are way too overbought that they are no longer pulling in funds to overcome the selling.

Thus the massive selling swept across them.

FYI: You could make more money by shorting these leaders in a few days than buying them for months.

Until they are oversold and become attractive again, market cannot substain any consistent rally without them.

If you recall, the March rally was “lead” by the C.E stocks. The C.E leaders “double” or “triple” their worth in just 3 months from March ‘08 from a long term decline of market. (at a time where all the other sectors were just trying to recover their $$$ damage)

Yesterday massive selling volume of C.E might indicate an upcoming bottom for the C.E stocks. Once they have bottomed, this might be the first time when “ALL the main sectors” are able to move together from an oversold condition.

The market doesn’t move out of bottom from a “perfect” economic condition. It bottomed when everyone has bailed out and all the possible bad news are accounted for.

Remember how stocks move? They move up and down based on net volume of Buyers & Sellers alone. Nothing else.

No one can tell how long the upcoming rally (if there is) can last but it might break all the possible downtrend lines and try for another new high from May .

Until another worse news are out, the market longer term trend is UP.

So short term am I bearish or bullish now? I am neither. I follow the trend and the trend indicates that LONGs are more attractive now esp when C.E stocks are done selling.

Related Stocks:  FNM, FRE

The commodities have a dramatic selloff yesterday and might have bottomed. I can’t used them as my regular short partners for now.

Here are some of the LONGs that I am looking at.

VMI was kept with a reversal candle formed so I might get a bounce sooner than I expected.

I handle my HD exit poorly leaving a 50-70% on the table . (a 10% on the stock movement at 1 time) Seriously, I should have exited when it was retesting its downtrend and failed.

I am getting slack with my exit points and leaving behind lots of profits. I need to improve, improve and improve on them.

Stock that failed to breach a resistance will definitely retrace . No point keeping the stock for short term. Thats why I emphasize on having the same position sizing for every option trades so I can spread my gains and losses evenly.

Related Stocks:  HD, NOK, VMI

Market Trend: (Short Term)
Bearish
(Buy stocks out of downtrend line and Short the Downtrend stocks only)
UpTrend Sectors :
Financial related, Health, Transportation, Homebuilders, Industrials, Retails & other consumer discretionary
DownTrend Sectors :
Energy, Commodities related

Sector performance (% change on day): Financials (-6.75%), Tech (-1.93%), Health Care (-0.16%), Consumer Staples (-0.93%), Consumer Discretionary (-2.81%), Industrials (-2.51%), Energy (-0.58%), Telecom (-3.07%), Materials (-2.23%), Utilities (-0.67%).

Extreme overbought always mean vulnerable selloff

Wow market selling off 283 points despite a mere $1 oil gain. Whats happening again?

Well, market was extreme overbought as mentioned yesterday and are very vulnerable for profit-taking with any uncomfortable news.

There were two such news yesterday:

1. Initial jobless claims for the week ending July 19 totaled 406,000, which is an increase of 34,000 from the prior week and 26,000 more than economists expected
2. Annualized sales came in at 4.86 million, which is down from the prior reading of 4.99 million and below the consensus forecast of 4.94 million. Month-over-month, existing home sales slipped 2.6%.

Do note that DOW went up almost 800 points in 6 trading days with not a single down day. Now that was an emotional run with no basis.To expect market to continue such historic runs are almost impossible in such economic conditions.

So any uncomfortable news are going to give the investors a chance to take the good profits they have in hand.

Whether this is a simple profit-taking or we are going back to a downtrend spiral again, nobody knows. Market will definitely retrace more to ease the overbought levels.

Prices reaction to Support level is crucial to resume uptrend

How price react at the support level (around DOW 11220) will be crucial to gauge the investors sentiment to sustain a uptrend.

Falling back into the previous downtrend line will bring us back into official bear market again.

Sell off volume was light and SDS shorts were not enthusiatic

The sell-off volume yesterday was low. This means there was no buying present so buying ammunition may be available at support levels .

1 of my favourite indicator - SDS , Shorting ETFs didnt displayed a huge volume at the retest of its broken uptrend line. So that might mean something about the shorting sentiment.

Capitulation of Commodity & Energy sectors - End of Bear Market?

Commodity/Energy stocks went into a capitulation with massive volume yesterday. A bottom could be near if they are able to break their downtrend.

If that bottom is truly in, the market might finally have all sectors moving together. That would truly bring the influx of buying power to substain a major uptrend .

An uptrend market needs leaders or sectors with the best earnings to lead. The current leaders are the commodity/energy stocks esp the Oil stocks.

If you could recalled, the previous March bear rally was lead by the commodity/energy stocks.

Tech and Financials are not capable to do the job alone. They are not fundamentally sound and rally cannot be sustained.  Their stocks will selloff too easily with any bad earnings from them.

Related Stocks:  SDS

VMI was kept with a reversal candle formed so I might get a bounce sooner than I expected.

I handle my HD exit poorly leaving a 50-70% on the table . (a 10% on the stock movement at 1 time) Seriously, I should have exited when it was retesting its downtrend and failed.

I am getting slack with my exit points and leaving behind lots of profits. I need to improve, improve and improve on them.

Stock that failed to breach a resistance will definitely retrace . No point keeping the stock for short term. Thats why I emphasize on having the same position sizing for every option trades so I can spread my gains and losses evenly.

Below are the few trades that I like.

LONGS

SHORTS

Related Stocks:  ANR, ATHR, CLF, CLR, CSX, MA

Slightly Bullish
(Buy stocks out of downtrend line and Short the Downtrend stocks only)
UpTrend Sectors :
Financial related, Health, Transportation, Homebuilders, Industrials, Retails & Other Consumer Discretionaries
DownTrend Sectors :
Energy, Commodities related

Sector performance (% change on day): Financials (+1.88%), Tech (+1.40%), Health Care (+1.06%), Consumer Staples (+0.46%), Consumer Discretionary (+2.04%), Industrials (+1.15%), Energy (-3.83%), Telecom (+3.35%), Materials (-1.68%), Utilities (-2.30%).

Market resume its overbought conditions

The market continues to test its resilience to push higher with oil prices unable to make any significant recovery.

There are no good news nowadays so market are taking consolation from

1. Lowering of Oil prices
2. Extreme oversold conditions and alot of bad news already discounted
3. The recent financial earnings doesn’t look like End-of-the-World for the financial companies

Overbought conditions are now extreme on most technical indicators you can get out there (Stochastics , RSI, MACD). So don’t be surprised that the market might take a rest now before moving higher.

But hey, whats Overbought in this volatile market anyway? The market didn’t consider oversold when it went down.

Look at the way stocks are moving up explosively. Talk about “Stocks go down faster than they move up”. Time for a rephrase?

Anyway, moving up such rapidly in a few days without resting means market is very vulnerable for profit-taking. So if you are in profit, take some off or trail your stoploss tighter.

Market closely related to Oil

Yesterday , the market went into a intraday profit taking when Oil tried to make a recovery. However the gains in Oil were quickly devoured.

Market came back and closed positively and thats how closely the market is related to the oil prices nowadays. Such relation are making prices more volatile and harder to trade.

So before the market made a disconnection b/w Oil and the Stock market, we got to take USO (Oil ETFs) into our consideration when buying short term buys.

Yesterday USO came back up to test its downtrend line and failed miserably with a considerable volume down. This means market might have more firepower to continue pushing its overbought conditions to another level.

Market might rest this week depends on Oil prices

SPY chart though show that we might rest as it was stalled on the earlier downtrend line. However if we could get some buying power from another round of oil prices dropping, we could pop above it and continue to rally.

Related Stocks:  SPY, USO

The market might be ready to rest and retrace for a few days soon.

So I am going to be more careful about my buying point.

Yesterday, Oil prices retest and failed to go up and close back down. This means the market might continue to go up this week despite the overbought conditions. (I am assuming the market is closely tied to oil prices)

I am slow to climb on the rally so this means there are many overbought stocks which I can’t buy until they have retraced.

Spotted this 3 stocks with good industry strength from Housing, Telecom and Manufacturing.

Related Stocks:  HD, NOK, VMI

The commodities are deeply oversold and look to be setting up to join the market to rally.

The best leaders are in the commodities sector and market can’t rally much without them.

Ferts are looking very good now and I may buy some calls of them tml.

Its too difficult to buy calls in a downtrending market when fear is overwhelming.

Closed Trades

Related Stocks:  AGU, BIDU, IPI

Market is really going to rally BIG if we just cut short of all the rumours leaked by the shorters out there.

The leaders’ chart say so.

Anyway, I managed to close out GMXR today bagging a cool 96% profit in 2 days. I would probably keep it till next week if not for the other two deep-red calls.

The other 2 calls are currently 40-60% down but can be easily turned positive due to huge intrinsic value that these 2 big movers can provide.

IPI is looking good and is setting to rise next week if we dont have bad rumours again. BIDU is worrying me though.

Frankly speaking, I am still hammering myself why did I buy BIDU. The sister stocks are still in downtrend. (SOHU, GOOG, SINA …argggg…another complacent pick)

If history still holds, we are going to have a good 2-3 day rally before option expiration and then down again .

I will look to savage whatever I can from BIDU if it still doesn’t turn up..

Have a nice weekend everyone !

Related Stocks:  BIDU, GMXR, GOOG, IPI, SOHU

Leaders will offer the best bang for your bucks as their charts are showing least resistance with most buying.

Sister stocks : CLR,  GDP, EAC, FST, PXP

Sister stocks : POT,  CF, MOS, SQM, IPI

Sister stocks : CSIQ,  LDK, SPWR

Sister stocks : PCX,  JRCC, MEE, BTU

Sister stocks : TS,  RS

Related Stocks:  AGU

Its vital that the sellers are done with the commodities and then we could climb out of the oversold conditions to rally.

Yesterday , I am seeing a lot of leaders of commodities showing selling exhaustion and signs of strong buying.

Leaders are the captain of the market. They direct the market going up or down. Thus I have always focus my attention on them . LONGs be with them and SHORTs be with them is my motto.

Its becoming less and less attractive to me to continue shorting the market. I am seeing more and more leaders setting up and selling is drying up . (Pls note that I am a swing trader that looks not long than 2 weeks ahead)

Market moves in swings and the next swing should be a rally one before I decide to short some stocks if bear market prevails.

Lets take a look at some the leaders in the commodities sector.

Market Short-term Trend:
Slightly Bullish due to extreme oversold
(Buying strongest sectors on downtrend breakout or rebounce uptrend, shorting weakest sectors that stalled on downtrend line)

Strongest Sectors :
Energy, Tech, BioTech, Commodities related, Defense related

Weakest Sectors :
Casinos, Financial related

DOW was up 100+ points before it gave up all when oil prices move up rapidly on a technical bounce. It went into a new low and quickly went back to positive areas.

Yesterday the volume for SPY was 3 month high. When market reached new low and mass volume pushes it up, you know there is some powerful buying out there to support the market.

Even 1 of the weakest stock in Casino, WYNN gapped up 15% in a prelimary earnings report ! This shows how sentiment is changing and how much you can get hurt in an oversold condition.

So short term SHORTERs, do take care as the elusive bear market powerful rally may be approaching.  Buy some longs for protection. Those already in profits, trail them tight !

Sector performance (% change on day): Financials (-0.93%), Tech (+1.27%), Health Care (+0.45%), Consumer Staples (-0.02%), Consumer Discretionary (-1.72%), Industrials (+1.22%), Energy (+2.68%), Telecom (+1.49%), Materials (+2.51%), Utilities (+0.49%).

Related Stocks:  SDS, SPY

Market Trend: Downtrend (Edge on shorting the weakest sectors & buying strongest sectors)
Strongest Sectors : Tech, BioTech, Defense related
Weakest Sectors : Commodities related, Casinos, Financial related

A strong buying on Wednesday across all sectors and a retreating oil price seem to set up a possible short term rally.

In the end? A single bad new of Fannie Mae and Freddie Mac near the close bring the market down closing a new LOW.

All the gains from Wednesday were absorbed and we should see dramatic lower prices in these two days especially Friday. So hang on to the volatility .

This market has no conviction and is too manipulated by the bad news out there.

Shorting is more favourable in this kind of news-fear driven markets . Only buy stocks that are on uptrend well supported or at least not in downtrend.

For option buyers, you might want to buy PUTs till Friday and stick with calls during the option expiration week where stocks tend to go up .

Sector performance (% change on day): Financials (-5.23%), Tech (-3.23%), Health Care (-0.35%), Consumer Staples (-0.54%), Consumer Discretionary (-2.66%), Industrials (-2.40%), Energy (-2.11%), Telecom (-2.39%), Materials (-0.82%), Utilities (+0.90%)

We are probably on the upside bias till next week.

But ...who knows , market can go down again due to another news of bank collapsing or oil prices up sharply.

I will trade what the market can give me for now.

Related Stocks:  BIDU, GMXR, IPI

So we are going to look for LONGs that can give us explosive returns in days .

Look for stocks that are building a base during the correction .

I mentioned AAPL & BIDU 2 days ago and they are still favourite picks.

In addition , I included SQM which is SUPER-Runner that I cant ignore it.

More info over here

Related Stocks:  AAPL, BIDU, SQM

Related Stocks:  FSLR

Market Trend: Downtrend turning Reversal (Wait for confirmation today)

Strongest Sectors : Tech, BioTech, Defense related

Weakest Sectors : Commodities related

Looking at the action across all sectors yesterday, I can't help but maintain a bullish outlook for the next few weeks.

I am a chart believer and have been buying PUTs for the past few weeks but I am about to change my "direction". (that is option calls and outright stock buys)

SPY and SDS which is an absolute indicator for the stock market health make a significant reversal yesterday. Both formed a reversal candle with volume for conviction.

However, look at the chart of SPY , we can see there is 2 downtrend line obstructing.
Once these two trendlines are broken, we can safety say that prices
will go up and probably test the Mar highs in a couple of weeks.

Thats how fast the market can move nowadays.

Not only is this huge reversal action seem at SPY & SDS, we can see it at across every individual sector.
Its as if the BIG BOYs are getting itchy now with so much money on the
sidelines.  They are the deciding factor on how this market moves and
they are not as fickle-minded as the broad based investors.

I have uploaded AAPL , one of my longs earlier to reflect on the market possible direction. Some of the highly traded Leaders in this market move in tandem with the broader market. We can use it to confirm on our sentiment.

So lets await today market action and I will decide on the appropiate action to take. As of now, I am looking at LONGs .

Best & worst performing sector ETF's in today's session

Sector Leaders:

Commercial Banks- KBE +8.1%, Homebuilders- XHB +7.75%, Regional Banks-
KRE +7.65%, RKH +6.75%, Real Estate- IYR +7.25%, Finance- XLF +6.05%,
IYF +5.9%, Transports- IYT +4.75%, Broker/Dealers- IAI +4.6%, Insurance
Brokers- KIE +4.05%

Sector Laggards:

Nat. Gas- UNG -4.65%, Oil- USO -4.25%, Commodities- DBC -3.85%, GSG
-3.45%, Base Metals- DBB -3.8%, Heating Oil- UHN -3.55%, Gasoline- UGA
-3.45%, Ag/Chem- MOO -2.3%, Steel- SLX -2.05%, Gold Miners- GDX -1.5%,
Energy- IYE -1.5%, XLE -1.35%

Related Stocks:  APPL, SDS, SPY

I mentioned that the market is currently waiting for the commodities to sell off before staging a powerful rally.

The rate that the commodities are selling is incredibly fast so I am on the cautious side .

Related Stocks:  CLR, FSLR

As of now, most Oil stocks are down for 4 consecutive days . Not just tiny drop but big down bars.

They could go down more as I havent see any retraction on the selling bars.

However I understand pigs get slaughtered esp for short time options. I got out with no regrets.

480% return with options in this week . Not a bad bear market week...

Related Stocks:  CLR, SD, XCO

In a bear market, stocks often rally in the earlier hours and sell off in the late hours.

Now I am left with 3 other puts whose charts look good for another 2-3 days . Will update again in real-time when i sell this time.

*
I am thinking how to document my option trades in covestor.com for
proof. Probably I going duplicate my options trades with 1 share of the
stock .

Related Stocks:  CLR, ENER, SD, XCO

The market was trying to rally in the early hours but the gains were devoured happily by the Bears (Sellers or Shorters).

Near the last two hours, the market staged an impressive rally of 100+ points before giving most back.

Best & worst perfroming sector ETF's in today's trading session

Sector Leaders:
Solars- TAN +3.6%, KWT +3.1%, Coal- KOL +2.9%, Internet- HHH +2.7%, Base Metals- DBB +2.0%, Steel- SLX +1.7%, Tech.- XLK +0.90%, QQQQ +0.60%, Wind Energy- FAN +0.70%
Sector Laggards:
Ags.- DBA -4.8%, Homebuilders- XHB -4.55%, Commercial Banks- KBE -4.4%, Regional Banks- RKH -3.9%, KRE -3.0%, Nat. Gas- UNG -3.9%, Finance- XLF -3.25%, IYF -2.9%, Broker/Dealers- IAI -2.9%, Energy- OIH -2.35%, IYE -2.5%

This are speculative plays and I look to exit before 3-4 days.

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The Commodities are undergoing some serious profit-taking. This is neccessary for the market to get some funds back to the other sector for the elusive oversold rally

Meanwhile with the market in downtrend, its better to short the weak stocks for the time being.

Related Stocks:  CLR, ENER, SD, XCO

LONGS:

SHORTS:

()

Related Stocks:  AAPL, BIDU, GMXR, XCO

Strongest Sectors : NIL

Weakest Sectors : Commodities sector - Coal ,Metals, Ferts & Oil related stocks

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With a rather low volume across all stocks on Thursday, we can't have a conviction on the price movement .

Thus we have to act accordingly to the price movement this week.

As of now, the commodities are selling off (Short opportunity) and the rest of the sectors(Buying opportunity) seems to find support and are building a base.

Lets take a look at at the SPY chart for a general outlook.

Time is money esp in options !

However, I may dabble in options again if i can find some reversal candles.

Seeya Mon for next update.

Related Stocks:  AGU, DRYS

Commodities will be on selling pressure for the upcoming weeks depending how fast the sellers let go.

Below are my two new trades :

Related Stocks:  AGU, DRYS

Looking at the slaughtering of neighbouring Coals & Steels, I have to get out , ended with a small net profit thanks to GMXR .

I always obey this statement,. When you are not sure of your trade , GET OUT immediately !

Meanwhile I will buy option PUTs for this few weeks until the commodities selloff

is done and an extreme fear has reached. I will be looking at Techs for LONGs.

Related Stocks:  CLR, EAC, GMXR, SOHU

So where's the problem?

The commodities breakdown !

Coal & Steel sectors are being slaughtered. Months of gains wipe out in a day !

(Sorry for the small image, I will link the pics from my blog when its up in a few days)

Take a look at the leaders of the Coal & Steel sectors .

The market has been bleeding slowly and we could not get the capitulation required for a bottom. The commodities have been supporting the market as most of the money has been flowing into them.

$VIX is a good indicator of extreme Fear & Greed. When Fear reached an extreme, a super rally is always near.

We have reached the bottom of Jan & Mar lows but yet the fear level is nowhere near the earlier high.

In summary, the commodities selloff will be great for the market in months to come.

New capital will be released into the financial and tech sectors and a healthy stock market will blossom.

So for now, KEEP your cash at hand or simply shorts the commodities or downtrend stocks.

Related Stocks:  MEE, X

Related Stocks:  ATW, BIDU, PCX

Related Stocks:  AAPL, BIDU, CLR, EAC, GMXR, PCX, SOHU

Market Outlook

Market Trend: Down-Trend turning Reversal soon (Prepare to cover shorts & buy strongest sectors only)

Strongest Sectors : Coal ,Metals, Ferts & Oil related stocks

Weakest Sectors : Financial related, Housing & Casino

Commentary Updates

An impressive reversal rally we saw yesterday. A reversal from its lowest point to form a Bullish Engulfing is a very powerful reversal candle.

The support is more meaningful as it touches the earlier March lows which is a very significant support. A triple bottom here?

This reversal action is seen at many stock leaders like AAPL & BIDU who usually defines the strength of the Broader Market (BM)

Hopefully we can see some positive market action today to scare out the shorts and use the short covering to blast thru' the downtrend line in days to come .