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Daily Market Comments - February 2007

2/28 - Stock Market Comments

Many positions were closed out on Tuesday strictly based upon a weak opening of the market. The weakness in Tuesday's futures revealed a break from the previous seven months of investor sentiment, bringing the Dow down to touch the 50 day moving average. That weakness on the open Tuesday closed out most of our positions. The magnitude of the move for the rest of the day was clearly unexpected. If you're sitting in cash positions, give this market a day or so to tell us which way it plans to move.

2/27 - Stock Market Comments

The morning futures are the weakest they have been showing at premarket for the past six months. This is a definite change of investor sentiment. The Dow futures should bring the Dow down toward the 50 day moving average. This has not occurred since August. Unless there is a major bounce today, investor sentiment may have finally broken. Be ready to take profits today.

2/26 - Stock Market Comments

The Dow closed right on the 20 day moving average, the NASDAQ closed weaker but showed a fairly indecisive trading day. Nothing dramatic has occurred in the markets to change the overall investor sentiment. Continue to hold long positions with the anticipation that the slow uptrend is still in progress.

2/23 - Stock Market Comments

The Dow continued its expected profit-taking pullback. The Nasdaq held up well on Thursday. The morning talk shows are still touting the 10% correction prognosis. Continue to stay long until the markets tell you it's time to liquidate. As of now, there are no indications that selling sentiment has taken over.

2/22 - Stock Market Comments

Wednesday's trading appeared to be profit-taking, especially in the Dow. The fact that the Dow closed lower while the NASDAQ closed higher was a good indication the funds were just shifting versus coming out of the markets. Commodity prices gained the headlines on Wednesday. Gold and silver prices were up dramatically. Crude oil prices closed back up above the 50 day moving average. This could put a damper on the magnitude of the stock market uptrends. Continue to stay long until a dramatic sell signal indicates a change of investor sentiment.

2/21 -Stock Market Comments

The markets had another healthy day, moving lower in the morning followed by the Bulls stepping in again before the end of the day. Both the Dow and the NASDAQ closed at recent highs, the NASDAQ at a 6-year high and the Dow at an all-time high. The uptrend continues. The Dow formed a Hanging Man signal on Tuesday. The lower open today should indicate the beginning of some profit-taking days. Look for some weakness over the next few days, mostly profit-taking.

2/20 - Stock Market Comments

Both the Dow and the NASDAQ held up well on Friday considering it would have been a perfect time for consolidation after a strong run up during the week. As was obvious for the past six months, nothing changed investor sentiment, the uptrend is still in progress. Crude oil prices showed a little strength going into the end of the week. That could be a possible short-term deterrent. However, mergers and acquisitions could be the next stimulant for the markets.

2/16 - Stock Market Comments

The markets showed surprisingly good strength on Thursday after two strong prior trading days. We would not be surprised to see some consolidation on a Friday and an options expiration day. The Dow is trading at the top end of its trading channel. A breakout from this level could start some exuberant buying.

2/15 - Stock Market Comments

The Dow has moved from the bottom of its trading channel to the top of its trading channel in two days. It is now nudging the top of the trend channel with strength left in the  stochastics. The NASDAQ has bounced off the 50 day moving average  support level with good bullish candles again. Anticipate more upside  potential over the next few days.

2/14 - Stock Market Comments

Once again the anticipated support area for the Dow acted as  support. The strength of the move in the Dow on Tuesday was a pleasant  surprise. Another day or two of indecisive trading at the 20 day moving  average level would not have been unexpected before the Dow could start  moving back up again. Although the NASDAQ did not show the same  corresponding strength, more positive trading on Tuesday was evidence  that the 50 day moving average was acting as support once again. The  same scenario remains in effect, the slow steady uptrend of this market  is still in progress.

2/13 - Stock Market Comments

The selling in the markets on Monday was anticipated after Friday's  weakness confirmed the Hanging Man signal in the Dow. But candlestick  signals once again revealed that the selling was somewhat indecisive.  Both the Dow and the NASDAQ have pulled back to areas that have acted  as support during this uptrending market. This morning's futures are  showing bullish indications that the sellers are not overpowering this  market. Continue to hold long positions until the current market trend  shows a severe sell signal.

2/12 - Stock Market Comments

The Dow closed right at 20 day moving average on Friday. The NASDAQ  formed a Bearish Engulfing signal. Stochastics were in the overbought  condition. We would anticipate profit-taking over the next couple of  days, producing a sideways action in the markets.

2/8 - Stock Market Comments

On Wednesday the markets did not show any indication of changing  direction. Earnings season is just about over. This morning's futures  are showing a weaker open. Continue to stay long until a definite sell  signal occurs in this market. 

2/7 - Stock Market Comments

The lack of directional trading on Tuesday continued to confirm the  slow uptrending market scenario. The semiconductor sector is acting  strong. The transportation stocks have been acting strong. Cisco has  come out with good earnings and good future prospects, providing a very  good outlook for the future of the economy. Continue to hold long  positions.

2/6 - Stock Market Comments

The past two days the Dow has not shown the extensive force that  would push the Dow index up through the top of the trading channel.  Although there is not anything to negate the current uptrend, a strong  breakout from the trend channel appears to be diminishing. This is not  a bad thing. The current conditions of the markets allows for strong  candlestick signals to perform as expected without the influence of  strong oscillations in the market in general. The slow uptrending  market allows the strong chart patterns to perform well.

2/5 - Stock Market Comments

Although we would like to see the Dow break out through the top end  of the trading channel, the profit-taking consolidation of Friday was  not detrimental. The NASDAQ closed positive, illustrating the investor  sentiment has not changed. The longer the experts keep predicting the  expected pullback, the greater the opportunity to see an exuberant  rally at the top. Continue to hold long positions.

2/2 - Stock Market Comments

The strength seen in Wednesday's trading carried through into  Thursday's trading. The Dow is now approaching the upper trend channel.  The difference between this approach of the upper trend channel versus  previous approaches is that the stochastics still show good upside  potential. The other indexes also show more upside potential. If the  Dow breaks through the upper trend channel resistance, it may be an  indication that a new strong rally may be in progress. Continue to hold  long positions.

2/1 - Stock Market Comments

The Feds did nothing with interest rates, which was not a surprise  to the markets but very well received. The Dow came back up toward the  top of the trading channel in one day. The stochastics have plenty of  juice behind them. A breakout through the upper end of a lengthy trend  channel would signify a few strong days of rally.


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