Daily Market Comments - May 2007
5/31 - Stock Market Comments
The strength in the markets was evident with news from China that could have instigated some selling of today; which it did in the morning, but the Bulls stepped right back in in the afternoon. The Dow has now formed a J-Hook pattern supporting on the T-line. There is nothing yet that indicates the bears being able to take control. Continue to hold long positions, especially in the strong sectors, such as oil and oil refineries.
5/30 - Stock Market Comments
The markets traded positive Tuesday after the Bullish Harami signals. This morning's weakness in the futures and the reaction to the Chinese market selling off hard need to be watched today. Although the markets are not showing any great weakness during this trend, they are not showing any great strength either. We may be heading for a sideways market for the next few weeks. This would not be unusual after a strong run like we have seen in the markets for the past few months. Continue to stay long in the strong positions and also have some short positions positioned in the portfolio.
5/29 - Stock Market Comments
Friday's positive trading formed a Bullish Harami in the Dow, NASDAQ, and the S&P 500. This indicated that the selling should have stopped. If so, the selling has stopped right at our T-line or the 20 day moving average, an indication that those moving averages are still acting as support. The positive futures this morning confirm Friday's Bullish Harami. A positive close today will be more evidence that the uptrend will continue.
5/25 - Stock Market Comments
As anticipated, the markets took some profit-taking over the last couple of days. The sell signals became evident in both the Dow and the NASDAQ. Anticipate some consolidation today, on a Friday before a holiday weekend. Currently, the morning futures show early strength. Look for a Bullish Harami today.
5/23 - Stock Market Comments
Although the Dow traded flat yesterday, the NASDAQ traded positively, indicating that the Bulls were still participating in the market. The pre-market futures this morning are still indicating bullish participation. The European and the Asian markets continue to trade positive. Expect some profit-taking, but not any great change of market direction. Continue to hold the long positions that show bullish charts. There are sectors that are acting very well. Housing stocks have shown strong buying patterns, as we have mentioned in the past week or so in the evening chat sessions.
5/22 - Stock Market Comments
Although the Dow showed some selling on the close, the NASDAQ and the S&P 500 are showing strong bullish patterns. The small cap stocks should be just catching up to the big cap stocks. Anticipate more upside in these markets but expect some profit-taking during the uptrend.
5/21 - Stock Market Comments
The markets showed no indication of weakness on Friday. As long as the trend continues without signs of a candlestick sell signal, continue to hold long positions.
5/18 - Stock Market Comments
The markets had the opportunity to consolidate yesterday, but held up well. Today's futures are indicating the bulls are still in this market. Stay long.
5/17 - Stock Market Comments
The potential sideways movement of the markets was diminished yesterday with the continued strength exhibited by the Dow. Nothing yet has indicated the uptrend isn't still in progress. The late earnings reporters are still reporting stronger than expectations. Continue to hold long positions until the markets tell us to do otherwise.
5/16 - Stock Market Comments
The Dow traded higher yesterday, but formed a Shooting Star signal. The NASDAQ sold off fairly hard. The indexes are not showing the same strength as the Dow. This may not necessarily mean a reversal is occurring, however, it still indicates that a sideways market may be in store for the next few weeks. This market scenario makes analyzing each individual stock chart pattern more important. There will be good long positions in this market environment as well at some good short positions.
5/15 - Stock Market Comments
The Dow traded positive on Monday while the NASDAQ sold off. This indicates no change of investor sentiment. The uptrend that has been in progress may be running into some sideways trading. Obviously, with the earnings reports finished, there is nothing to dramatically stimulate this market. Continue to hold long positions that continue to show strength. If the market is back into a steady uptrend, albeit very slow, this provides an opportunity to find the stocks/sectors that are performing well.
5/14 - Stock Market Comments
The markets formed Bullish Harami signals on Friday, indicating the selling had stopped at the moving averages that were acting as support. Until the trading can close down below those support levels, and without any severe sell signals, the markets should be considered being in an uptrend. Watch for J-Hook patterns that have formed over the past few days. This would indicate profit-taking during the uptrend.
5/11 - Stock Market Comments
The indexes came back to major support levels. The Dow pulled back to the T-line. The NASDAQ closed just below the 20 day moving average which had acted as support in the early part of the uptrend. Today's trading will indicate whether the markets will support at these levels, by forming Bullish Harami signals, or continue to go lower. Weaker trading by the end of the day would reveal a pullback that would head for the next lower support levels. Be ready to add some short positions on weakness today and close out long positions that are not working.
5/10 - Stock Market Comments
As long as the government stays out of business and economic situations, the economy will stay strong. After the Fed report on Wednesday, the markets were pleased that nothing had changed. There will be some profit-taking during this uptrend. Continue to hold long positions until there is a dramatic change of investor sentiment.
5/8 - Stock Market Comments
Although the Dow showed strength on Monday, the NASDAQ, S&P 500, and the Russell 2000 have shown indecisive trading over the past couple of days. Anticipate a few days of profit-taking. That should bring the markets back closer to the T-line or possibly the 20 day moving average. This does not necessarily mean a reversal in the market trend will result, just some profit-taking.
5/7 - Stock Market Comments
Friday was a relatively lackluster day in the markets but it continued to illustrate the Bulls were still in control of the market. Do not be surprised to see some profit-taking, using the T-line as support, but the uptrend in the markets should still be in progress.
5/4 - Stock Market Comments
As described in the newsletter on Thursday, the Dow has been moving up almost every single day, which is causing most "professionals" to expect some sort of profit-taking pullback. However, the other indexes have consolidated nicely with profit-taking during this uptrend. Continue to hold long positions until something dramatically changes investor sentiment.
5/3 - Stock Market Comments
After the Bullish Engulfing signal formed in the Dow two trading days ago, the markets needed to see a strong day to negate the possibility that the Bullish Engulfing signal in the overbought condition was last gasp buying. The strength on Wednesday in the Dow confirmed that the uptrend was still in progress. The strong day in the NASDAQ formed a Morning Star signal that bounced off the T-line. Nothing yet has changed investor sentiment. Continue to stay long until a major reversal signal appears. Crude oil prices failed at the 200 day moving average, pulled back, and failed to support at the 50 day moving average. A strong down-move in crude oil prices could add more strength to the equity markets.
5/2 - Stock Market Comments
The earnings season is over, now the markets are going to have to move based on future projections. The strong close in the Dow Tuesday formed a Bullish Engulfing signal in the overbought condition. This gives cause to start watching for some sell signals. The NASDAQ formed a Doji right on the T-line. The markets need to see a bullish day today to confirm the uptrend. A lower trading day after Tuesday's Doji in the NASDAQ would indicate a selloff still in progress.
5/1 - Stock Market Comments
The NASDAQ pulled back fairly hard on Monday. It closed down below the T-line after a couple of Spinning Tops in the overbought condition. Today's action will indicate whether the T-line will support the uptrend. The Dow also showed weakness on the close on Monday which makes a pullback to the T-line a logical target. Expect another day or two of profit-taking in this uptrend. Aggressive traders should add a few short positions to the portfolio. Long positions that are showing weakness should be closed out.