The Daily Dose of Trading Comments

The Blogger site is back up now so I will make a final post and add the two hand posted notes from earlier as well.

Looks like a program hit the market shooting it skyward before the close but then that fell apart as well and we end the year on a bit of a sour note.

I've taken a few profits today and most notably added to the MNC position. Still expecting more out of that issue as the earnings season nears. As for the general markets, although they somewhat disappoint today, it's hard to read much into it. Volume was light and will likely be light again on Friday. Next Monday will start to show a clearer picture of what's next as we start another year on the markets and this site. Again I wish you all good fortune in the coming year in both monetary and mentally/physically. Have a safe New Years and I'll see you hear again Friday.

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Here's the two posts done earlier manually when having trouble connecting to the site.

Still dealing with posting problems. This will be the last one for the day. Only real news is that I'm averaging into a larger MNC position on this weakness. General market looks to close sloppy today. Have a happy New Year and see you on Friday.
posted by Leslie # 1:02:33 PM
I've had the usual computer issues this morning preventing posts so I'm circumventing now in order to post. I've done very little today and continue to do so. Market weaker than expected but it looks to be more about a lack of buying than selling so I sit and wait. No reason to do much of anything until Friday it appears.
posted by Leslie # 11:37:25 AM

We have traded right back down to 2K on the NASDAQ. I don't expect them to give up this area without a fight. I have been stopped out of a couple positions and have added back some MNC on weakness and have started a position in PSSI.

I'm not expecting a big day up or down but instead another grind higher today. So far the breadth is good and even with the NASDAQ dip into red, that index also has positive breadth. I'm tightening stops up on some stocks and starting to play it closer to the vest. Volume is low today so you may see more volatility. Don't get too close with stops. I'm mostly doing this on those with good upward momentum today.

It's New Years eve and time to make those resolutions is you haven't done so. With a clean slate a trading day away, what will this new year bring? As has been the case for a long time, there's a long laundry list of problems that cause concern. For the better part of the year, we looked at those problems and worried about how they would derail the rally. For the better part of the year they didn't.

Now with the New Year upon us, the problems have become a bit more excerbated, and the huge gains are taking off the books. The indexes start from higher levels and the predictions of what lies ahead are all over the map. Sure I have my leanings and they are that I still believe we are in a counter trend rally within and overall bear trend. The higher we move, the harder it becomes to believe this, but it still lurks back there in my mind. The problem will be recognizing it when it reasserts itself.

We have an election year in front of us and an accomodative Fed. Those are the two larges +'s the market has going for it. Easy money creates debt and a lot of debt has been put on during this last down cycle. Will that debt be cruched and the economy keep chugging along or will it become a burden because the economy turns? We will need to keep that on our minds as we move forward.

Most importantly, we need to concentrate on the more immediate picture because that's where we either make or break. We have a rather large inventory now of both long and short. We are wanting to catch another short term spurt north to book our gains on the long side thinking that the short side we are/have established works to our advantage on the pullback. Timing that move is what it's all about near term.

Guess all you have to do is to say it won't in order for it to do so as there was a late push back up to end all but the DJIA in the green. Talk about a late push though as it didn't go green until that last minute or so.

The vicissitudes of the market on a single day isn't as important as the larger picture which continues to look bright short term. With NASDAQ 2K cracking for the second time and now holding for a day, I would not at all be surprised to see some enthusiasm enter the market tomorrow before we clear out the books for year end. There's not a lot of news on tap other than the unemployment claims before the opening. Friday is a light day as well.

Today felt like a struggle as we juggled and had to decide how far we would allow positions to move against us. After the nice gains of yesterday, it was difficult to sit idly buy and watch the market encroach upon your profits, but with the underlying theme positive, that's pretty much what I did. Sort of threw the maiden the volcano on some AYI but other than that, we held and added for the most part and are looking forward to tomorrow. See you then.

With the market behaving well all day, I kept thinking we might see that late day rally. Well, I'm starting to give up on that idea. With 20 minutes to go, there's wasn't enough oomph in the move to keep it going and instead we are getting a light fade instead. I'm sticking with all positions unless they stop out as I still think there's more to come on this move. The fact that we are holding here at NASDAQ 2K suggests another push to come.

With a hour and a half to go, today has been a struggle to keep what you got. Many times when you have a good play go bad ... or simply a bad play, the tendency is to concentrate too much on what's not working rather than go after what is.

I tried to give AYI more room and eventually took out part of the position to make sure we end up making a gain there. Problem was, that was after we let a lot of yesterday's profts get away. Rather than dwell on that, the need is to turn your attention to something that is working. Another stock in the portfolio is breaking higher today and as soon as it started to do so, we let the surge occur, then bought the intraday pullback. I'm speaking of CANI. Looks like it may want to make a run at its highs today or tomorrow and we will try to catch a ride.

Overall the general market continues to hange tough and claw it's way higher. Other than a couple purchases and some small profit taking, I'm just doing my best to let the market do the heavy lifting here as we wait.

Market still holding up ok although I can't say that for the portfolio holdings. Slippage all over the place there.

One of the hardest things to do is to not pull the trigger to soon on profits. It's the exact opposite of an equally hard thing to do and that is to pull the trigger on a bleeding loss. This market is enough to make you bite your nails today because you don't want to see slippage after nice gains but that's the way it usually goes. Takes a while to digest a move and set up the next.

I'm watching closely and have tightened a few stops but am desiring to stay with these positions and to get another push forward to sell into. That's still the thinking.

Not a lot to say today. The maket continues to digest yesterday's crop of higher prices. I'm biding my time and making stop out decisions on a price and volume basis. AYI is an example. It's trading right where I had intended to stop out but there's no volume to this selling so I'm giving it a bit more room.

We are starting to see the market catch it's breadth here after the initial disappointment on the eco data. Underlying indexes are starting to point higher.

Very mixed early after the confidence number disappoints. I've stopped out of RA for small change and took an early exit on the rebuy of VYYO for some more decent gains. Will buy it back again if it comes in more; but lower still.

As we talked about earlier, you need to revisit all your stops and consider your exit strategy. You don't want to be took quick to exit but on the flip side, not taking profits when the odds start to turn short term is not that wise either.

There's not much on my buy list today. I do have one bid in the market this morning and that is for MLNM. Broke out yesterday on volume and looks to be worth starting a position in. I've started scaling back the size on any purchases though as a function of time and price for the general market.

It's likely that the majority of the easy stuff is over again. Positioning long and catching a tail wind the last few days was the easy part. Now we are closing in on the New Year, stocks are hitting new highs and it's time to consider exit strategies on all these longs that have been accumulated again.

I'm not saying to sell out here. I'm saying you need to refocus on what you sell and where you would like to sell it. Look ahead. We have earnings coming up next, we have a new year when the books are wiped clean and everyone starts from zero again, we have markets sitting at new highs, we will be topping out on momentum soon and the short term indicators will turn negative. Doesn't mean we can't go higher. In fact, I expect the NASDAQ to carry us higher before all of this comes to fold, but when if you want to trade, you have to look for the next trade and not be happy with the last one.

As such, I'm up bright and early going through the routine this morning. Determining where earnings hit on all the stocks in the portfolio. Looking at the charts and and rechecking the likely resistance points on all of them. Making notes to myself. Revising stops as appropriate.
Also looking at the bigger picture on the indexes themselves. Where is there next likely resistance points.

Yesterday I started a few more short positions. The portfolio, as you can see, is now at 58% long, 30% short and the remainder cash. Note that a lot of that short size is indexes still though. So I'm already starting to position for the shift lower. Now it's a matter of trying to book the majority of the gains that are left. If you are a trader, I would expect you to be doing the same.

What a day as NASDAQ 2K falls. There was nothing but positives today as the markets essentially went out on their highs. As is customary, I began to inch stops up, took profits in a couple issues and continued to buy where it made sense. That VYYO trade was something. Sold it on a stop and then turned to short it. Didn't have the guts to stick with the short and covered for a small loss then stuck a low ball buy back number in at $8.08. Yeah, on a day like today it hits. Go figure. Buy when they are selling and sell when they are buying! Volatility is a traders best friend.

The other major event for the portfolio today was to start up a couple shorts in the financial services of Freddy Mac and Fannie May (FRE and FNM). These two stocks have traded rather predicatably for some time and we will take the nice risk/reward trade being offered here.

Two more days til New Years and then everyone sets there books back to zero and begin anew. A lot can change and undoubtedly will but for now we are raking in the gains as they are being given and closing out another solid year of performance. I hope you were able to knock out a few good trades today as well. Also hope that the changes being made to the site benefit you in the coming days and year. Have a great evening and see you back here tomorrow as we prepare for another day of excitement.

Trimming a little of the winners taking profits on EGOV, and partial profits on MNC. Both I would like to buy back again a bit lower, especially MNC. Did take the FNM short as well. NASDAQ 2K close today? Has a decent shot doesn't it?

With a little less than an hour to go, I see no reason to change course. The advance is solid, we are in that seasonally strong time of the year, the eco numbers out tomorrow have more risk to take us higher than lower I suspect, etc. Other than the VYYO stop out, I've done nothing but add again today. I am inching stops up where it counts, but the desire is to let things continue to run until we get either a euphoric gap up that we can sell into, or we simply run out of time on the current leg and we need to pull things in.

As the markets head down the back stretch of trading today, we are hitting new highs on the day and the NASDAQ is pressing to break that 2K barrier again. Whether it occurs today, tomorrow or later this week, it seems inevitable at this juncture. Given that, what should you be doing as a trader?

First you take a deep breadth and say your thanks. Then you consider what you want to trim and take profits on or cut losses if that may be the case. Even in a portfolio that's performing like ours, there are still some stocks that are not performing yet.

Getting rid of a position always seems to be more of a chore than entering it. There's the uncertainty of whether we should let it go since it could make more money if we hold it. The problem with this thinking is that could always be the case. What you should do instead is to consider the stock as if you were going to enter it today. Would I be buying or shorting it today? If the answer is yes, then continuing to hold is a reasonable strategy. If the answer is no, you need to consider an exit strategy. You can let it all go; let some of it go; or simply trail it with a stop order just in case.

I have been long VYYO for a week or so. Today it made new highs and I inched my stop up behind it further. It was becoming quite extended you know. So, what does it do but to reverse off the new highs and is trading in the red now. We exited and locked in good gains and are looking to buy back in again as it moves from the portfolio to the Trade Sheets. When you have good gains, it's a sin to give them back. Manage your portfolio just as you would manage your garden ... actively and with good reason. If the weeds are sprouting, prune them. If it needs a little more care, give it the additional time. In doing so you will find that the portfolio can grow just as a garden grows and best of all, it can keep growing even when the winter arrives.

The message boards have been populated with the most useful comments from the old boards. I didn't attempt to bring everything over. There were lots of comments about the subscription model that this site went to for a while. The fact that we charged for services was met with great skepticism. Guess everyone likes to have something for nothing or for very little :)

I encourage you to use the boards to promote better trading for others on this site. I believe we now have a reliable method of posting comments for others to benefit by.

The breadth remains positive, volume ok considering the time of the year, new highs expanding, etc. Talk about a glass have full!

In the portfolio, I've added a few positions today in EAR, FJC, GTK, and TRPH. Net gain there so far but nothing major. You press when you can and that's what we are doing again here. There are times you can make good money and times that you dog paddle to stay afloat. If you look at the gains in the portfolio this year, they came in spurts with 30% of the gains in four months (including this month). When you have something going, you get all you can get while they are giving. There will be times when making money is worse than pulling teeth.

A bit of a pullback here as the NASDAQ ran right up to the cusp of new highs and naturally met some selling. I've added some EAR and TRPH this morning in the portfolio. I'm looking for new highs on the NASDAQ before the year is out.

We clearly are seeing the combination of the Santa Claus rally along with the rotation back to the OTC stocks. This is what we have been positioning for and are benefiting from. As the day wears on I will work through all the positions again raising stops, trimming if needed, etc. We have been fortunate enough to position well and naturally we want to make sure that we get as much out of it as we can while limiting our risks.

Put some orders out to short FRE and FNM here as they move to resistance. Resistance is strong on these stocks and it's a very good risk/reward even in this strong market move. Even this move higher will come back in as they all do despite it all being roses right now.

Everything happening as you want/expect. NASDAQ new high list kicking in. Good momentum in many stocks there. Nice internals. Good volume on the NASDAQ. Etc., etc.

Living off the inventory we have accumulated at this point and looking for a trade or two more if we can catch an entry.

So far everything looks to be a positive. I'm finding nothing that turns my stomach other than the fact that I didn't get into any additional trades I was stabbing for.

They do open them higher and the key underlying indexes look strong out of the box. The fact that we didn't get a exogenous incident over the holidays is probably a key factor. I'm fairly strong but bidding on some interesting plays in TRPH, FJC, GTK

Well, I must quit keeping such late quarters. Getting up the next day is too difficult.

Pre-opening is quite positive with the indexes solidly green. I've some catching up to do in order to prepare for the opening. Be back as it get's closer.

Looking forward to the coming week, there's not much in the way of eco data on Monday, but Tuesday has the sentiment number and the Chicago PMI. That's about it until Friday when we get the ISM index. Numbers are called lighter and that will probably keep the markets from selling off as it puts the risk to the upside likely.

Warning season is upon us and not much has happened. Still could occur but unlikely. More likely we will move straight into earnings reporting season without much in the way of warnings.

This week is historically a good one and I'll be watching to see if we can get more rotation back into small caps. Would like to see the smaller stocks start to make some serious gains.

The auto updates are working and though I have a couple more to write, it allows this site to become rather useful again as it provides you, the reader, with a good snapshot of what we are doing on a daily basis. Because I update the records during the day, I'm thinking that I might set it to update more frequently; like intraday to allow a more timely indicator to everyone.

I was trying to post some of the old messages off the message boards to the new message boards. If you remember, we vacated the old message boards due to a lack of reliability. I noticed that no one has posted to the new one although they have been around for almost a month. So when I tried to post, nothing happened. Is this happening to others? I'm working on it and will get it understood/fixed soon.

Lastly, I'm finding more time to do trading and am about ready to start revising the book that had it's beginnings with this site. If you have ideas or suggestions for what should be covered but isn't, drop me a line. Now that we have been trading successfully in public setting for a couple years now, there's a lot more to say and to describe better than the first rather half hazard attempt. I'll add comments here as I complete various sections. A lot of reorganization, some new material, and some serious rewrites are needed.

With a little less than an hour to go, it looks pretty random to me. Other than lifting the GG long, I've done nothing. Likely will end that way.

As a bonus, I've been working in the background to write some applications to get this site back to how it used to be with the Current Portfolio published nightly and the same for the Trade Sheets. As you all know I had cut down dramatically on the posting here as it was eating up too much time. Well, I've automated the activity and, after some testing, am ready to start using it. It's the old look the site used to have and which many liked but time constraints have kept me from doing. Take a look and enjoy. Now that I have a lot of the basic code written, I can hopefully expand this over time to other sections of the site as it makes sense from a timely update point of view as a lot of data I keep but don't publish given time constraints.

Well, anyway, this is probably my last post for the day unless something warrants further comment. Have a good weekend and be ready for next week were we have full trading days all days except New Years day.

I've taken out the last of my small metals position (GG). It was a bounce play and we made a few bucks on it considering the two purchases. When I'm working a bounce play, my time horizon is very short and you have to have the take what you can get mentality.

Market is settling down here and maintaing the positive tone. I'm simply watching.

I'm seeing the QQQ's on the verge on breaking out here. The tone is positive and good internals showing. Underlying indexes nicely positive. So far the day has a very bullish bent.

It's the day after but unlike many of our brethren, the markets will open for business and we need to shake off the cobwebs and prepare for another shortened day of trading. Asia traded mixed to higher and Europe is trading higher as well. Although the pre-opening trade is light, there is a bias to the upside as the QQQ's are now trading over $36.

The technical picture is such that the listed issues are extended and the OTC look ready to break higher. It's the passing of the baton if you will, where part of the market takes a rest while the other part tries to jog higher. Rotation in a word.

We have accumulated quite a bit of inventory of late and are not looking to add much of anything today but instead to simply manage the postions we have. If the rotation occurs and the fabled Santa Claus rally develops as it is accustomed to doing, then we should see the small caps gain these final days of December and into January. We will need to stay on our toes just in case but for now, we continue to manage and mostly wait.

No big push to end the day it appears. I've taken some profits on GG and DADE and added to the AVA long on it's breakout. Just positioning as always. I'm getting ready to turn the terminal off and call it a day. Last post so have a Merry Christmas and I'll see you on Friday for another shortened trading session.

A lot of times I think folks are still very much in the mode of buying and holding. Buying is just half of the equation. There comes a time when you must/need to sell. Of course you should consider that going in just as you consider how much you are willing to lose going in. In fact, I always consider how much to lose before I consider how much to gain and I always plug those numbers into an equation along with my entry point which calculates my risk/reward ratio. Unless I'm looking for a quick trade, I typically want a 2:1 reward to risk ratio. The more the better.

As far as do you stubbornly hold something because it hasn't met your exit price yet, you have to be realistic. The numbers you plug into your equation or best estimates you put forth looking at the chart on the day you create the numbers. Things change. Stocks and charts change over time. Everything is dynamic. It would be ludicrous to think it doesn't. For example, I plugged in the numbers $7.1 entry, $6.40 risk, $9 profit exit on IMOS back on Dec 21st. It's only been 3 days but yesterday we caught a nice move up to the top of the wedge. I was watching it trade this morning and decide to take the profits on the 900 shares at the 7.41 area. I immediately put an order to buy those same shares back at $7.22. Did I decide that $9 is not achievable? No, not really. Just booking some gains. If we can get an entry back at the $7.22 area, we've booked almost $200 for a trade. If we don't get back in, well, that's the risk we took by exiting. Of course, if it trades lower and then takes off, we will look pretty smart.

So why make the trade? Well, that's the hard part. You get a feeling for a stock based on how it trades and the time frame it is trading in. Booking gains on an ongoing basis is how you make your money. Hoping for all your stocks to continually rise without a fall is a fools game. Rotating in and out of stocks is how you book 35%+ gains on a yearly basis. Look at it this way ... trading around the edges is how you make your money. If you have enough inventory on the books, there will be those that bounce up and you need to trim them ... book the gains. There will be those that bounce down as well, and unless they violate the areas you believe indicates that they are the losers, you hold them and continue to monitor. As the stocks rotate around, you are constantly booking some gains, cutting the losers and generating ideas of new plays to work. There are countless technical set ups on a daily basis. If you are generating ideas on new plays, then rotating in and out of stocks and mostly making wins results in nice profits over time.

The market continues to struggle along here in the red. I've added some more EAR and BCON on weakness today keeping with the idea that you buy strong charts low and sell them higher. A couple hours to go and looking at the way the underlying indexes are trading I would be surprised if we don't make a dash to green before the day is out.

The AD line is improving and volume has turned positive on the NASDAQ. The only stock in our portfolio noticeably moving is VYYO. Nice volume as it tries to break higher. May look to add there on intraday weakness if it continues to develop.

It's a short day today so there won't be a lot of time for the market to right itself and turn green. The mad cow will pressure all day I suspect and as well Friday most likely. Today is a day to flip through charts and consider what you will do in the various situations. For example, I spent some time this morning reviewing all positions in the portfolio and adjusting stops (mostly moving some higher to lock in profits). Active money/portfolio management is the difference between winning and losing.

From what I can see early, there continues to be underlying bid support for the OTC issues. SMH/SOX in the green after opening red. Retail actually green and financials holding. Other than MCD getting whacked, DJIA actually holding up ok as well.

There are a number of good plays on the Trade Sheets from last nights update. If you have the stomach for volatility and need more eggs in your portfolio you might take a look at the gems listed there.

I'm holding long and looking to add a bit on stocks breaking out already in the portfolio, AVA, AYI.

The early read is read but the underlying indexes are not that bad and it looks as if the SOX is catching a bid as I write. Let's wait to hold judgement. The day before Christmas and afterwards are historically jovial and up.

We found out after the bell that a mad cow scare was brewing and this morning it is in full force. A quick check of all our portfolio positions revealed no direct link and since I don't try to play news events I expect to treat it at arms length. Too many people too greater informed than I to chase that pay check. Now if it turns into something larger (multiple cows/herds and God forbid, human infection) then we will have to take notice.

This morning we have a short trading day and the early number suggest the listed issues will be under pressure (from the above) while the NASDAQ got another shot in the arm on earnings from MU last night. Could that rotation back to the small caps play out yet again today? I believe so and will continue to try and milk that theme.

There are all sorts of events beyond our control that make this latest move higher a tight wire act. As we did the last time around, we will stick with what is working until it isn't anymore. As a small trader, we can move to cash fairly quickly and when it appears that is the thing to do, we will do so. Until then though, we need to continue working what trends the market is giving us and attempt to stuff the bank coffers for the rainy day. So, buckle up and let's go get them.

Well, we got a nice little treat before Christmas with another strong finish today. Like yesterday, the holiday cheer continues as there just doesn't seem to be enough stock to go around. As noted here, I had planned to pack it in till the close but when the strength started to develop, I felt necessary to chase a few more of these cheaper stocks with good momentum which are breaking out on nice volume buildups. I continue to think the OTC names will outperform and that rotation we saw into the listed issues over the past month will, to some degree, rotate back out.

With the late day move today, the NASDAQ is back within spitting distance of 2K. As I said before, it looks like a matter of time, not an if at this point. I've been building quite a sizeable portfolio in anticipation of this run and, for the most part, have been able to hold onto most of the issues while they have moped around waiting for the next run towards the highs. The two trouble spots right now are ULGX and BBX. May have to trim the former one and then add again lower. The latter I'm just not going to give much room to disappoint.

As I look over the internals for the day, we have good breadth again with the NASDAQ starting to push up nicely. With expanding new highs on both the OTC and listed, we totalled 651 new highs and have seen the NASDAQ new highs move from just 85 a week ago to almost 200 today. Clearly we have a ways to go and we could in fact see negative divergences again when we top out this next time (as has been the case for a while now). In the meantime though, they are giving money away and it behooves us to stand in line and gain our share.

Have a nice evening and see you tomorrow for the trade shortened day. Until then ...

And how about AVA ... breaking out finally as well from our portfolio. Will try to add a bit more of it here.

I like the strong finish here and have added EGOV. Here's another one; SBYN.

Just ran across this one breaking out on volume also; EGOV. Might want to take a look at it if you are still looking to add to the portfolio.

The NASDAQ strength has held all day with the SOX and the BBH being the backbone. If the coming days continue to show this strength we will in fact be seeing that rotation back into these names into year end as the window dressing occurs. There is a tendency for strong names for the year to get stronger into year end as mutual funds want to show those names on their books. The converse is true of the weak names as they want to have those off the books so they tend to get weaker into the end of year.

Add the above to the small cap phenomenon and this silly good feeling the market has now and you have the combination of higher prices in OTC stocks overshadowing all others. That's the thinking for the year end play.

My trading today has been reasonably limited. The GG bounce play is working out nicely, FLDR is sitting there since entering and AYI is about even as well. The latter two are plays for the coming days as we are playing volume breakouts there. I will likely pack it in for the day now as little is likely to happen this last 45 minutes or so. Note that tomorrow we have a shortened trading day with some news in front of the opening.

With the DJIA starting to pressure the indexes a bit, I'm adding to AYI in this area. It's clearly broken higher and with nice volume build up the last few days. Just started that FLDR position that I spoke of earlier. Good volume there on a push higher.

We still have the nice breadth on the NASDAQ and that average is holding up. In fact, the breadth can be seen on the NYSE as well. With a couple hours to go, I would expect a strong push into the close unless we get some exogenous event. I've done nothing more than the GG add early as nothing else worked out.

I've been looking at the NDX and NASDAQ charts this morning as well as the QQQ and they are all buttressing up against the previous highs. Will they have the oomph to break higher or will they need to churn more before doing so?

Earlier this morning I was thinking we could get that break today. With the nice internals and the lagging performance on the OTC, it was setting up that way. Whether it happens today, or in the shortened trading sessions later this week, or next week, it sure looks to be coming and will be the time that we look to lighten up on our holdings, book some gains and probably add to the short side of the equation. That's the thinking as I survey the market at this time.

Here's a couple more stock ideas. Take a look at FLDR which is looking to break higher today on volume. On the other extreme, check out SNG which is pulling back with the oil sector today on so-so volume. The 2.30ish level on that one is an attractive entry point.

We are starting to see some real separation in performance today between the listed and the OTC. This is what we have positioned for and we will benefit if this plays out. The BBH and SMH are both leading the charge and the QQQ's are sitting near a new high at 36. Looking for that high to fold before the day is out.

I'm looking to try and add to our AYI holding on it's breakout this morning. Want to add on this strength. They reported last week and have now worked to a new high. Also will add to the BCON holding on a breakout there if it occurs.

The NASDAQ is assuming the lead position and given our inventory and the market, I'm content to work the current portfolio and not add new positions. Added to our one gold holding here on continued weakness (GG) as we are probing for a bounce there. Looking to add to VYYO also on weakness. Tried to grab some APSG early but failed. So far, we are getting exactly what we were looking for and if we have picked the stocks well, we should be able to outperform in this kind of environment. Very positive bias early.

The early going is showing OTC strength relative to the listed issues. This may be the beginning of that outperformance we have been looking for. I've done nothing early wanting to wait for the sentiment numbers before I act.

Well, the early eco numbers were a non-event. Only thing remaining now is the sentiment numbers out of the Michigan survey a half hour into trading then it's pretty much up to exogenous events and positioning.

European markets mixed as were the Asian ones. We have Personal income and spending due out in a few minutes and that will likely set the tone for futures at the open. We are mixed right now.

Yesterday we saw that late day strength come into the markets again as the DJIA and the SPX both continue their march north and seemingly drag the NASDAQ with them. I've been looking for that to turn as the year winds down with the NASDAQ taking the lead. We will be watching that relationship again today.

Although I continue to do due diligence on new plays, I've a lot of inventory and my desire to get longer at this point is muted. The effort is directed toward working on the stocks in the portfolio more so than adding new ones. If you are looking for some new ideas though, take a look at GMAI, AGY and JBL from the long side. All three are nearing entry point range. You can also consider AEN, GLDB and NYB as stocks that could soon make their move and have been featured recently on the Trade Sheets.

On the short side, the broad shorts on SPY and DIA are interesting here and FNM and FRE are moving into and area where they may make sense. Not saying that I will add to the former or start the latter, but am observing. More than anything, it continues to be about careful management of existing positions with the desire to work a couple trades intraday. On that count, I continue to probe with INTC most likely.

Not to be disappointed, the markets did provide that late day strength into the close marking all the major indexes higher. Even the NASDAQ turned and finished strong. We worked all day to make a couple trades ... enough take home pay to take the wife out to eat and to the movies ... if we pinch pennies. Realistically, the portfolio performed ok and we ground out some gains again.

With all the exogenous events hitting this market and it continues to press higher, it's hard not to like its action here. A market that responds to bad news with higher prices is a market that has enough demand still out there. It's when good news doesn't move a market that you get a bit more worried.

I'm calling it an evening. Off to do some last minute Christmas shopping and stick a few more gifts under the tree. Have a good evening and be ready to roll tomorrow. We have some eco data and the last full trading day of the week. Wednesday and Friday the markets will only remain open for 3 1/2 hours. Bias remains up and we continue to hold lots of inventory into that bias.

So far this notion of the listed issues taking a back seat to the OTC is made of broken dreams. The inverse continues to occur with the internals better on the listed than the OTC, the price action, etc. Not ready to throw that thought to the wolves but we could be mistaken as that is part and parcel of this occupation.

The last trading hour is beginning to unfold with the realization that the earthquake didn't cause any major damage and we are getting a move back higher as a result. Let's see if that late day strength can develop into the close.

Looks as if the earthquake is in a fairly non-populous region of Cal and the market impact is likely to be muted.

Exogenous events continue. Earthquake north of LA now weighing on the market. Had to close the INTC long for a loss as it was an intraday trade and we are probing the lows again.

Looks like we are putting in some inverse head and shoulder intraday formations on the QQQ's, INTC, etc. I've put some INTC back on for a trade with a tight stop. Just trying to eek out some performance here on a slow day. Still waiting to see if we can get a push here into the close. If so, it would be viewed fairly bullish on this particular day given the exogenous event pressure.

Market continues to drift lower. I'm marking time and using the excess time to catch up on some reading. Did take those quick profits in APSG. If you are willing to suffer the volatility risk, a trade like that can work nicely. You just put an order out there above an obvious buying support and let the market do the rest. If you fill and get a pop up, then you can measure an exit and book the gains.

I see the QQQ's setting new intraday lows as I write. There's not real enthusiam though and it looks to be a drifty day. I'm suspecting that we could see some of that late day buying kick in with a couple hours to go today.

On a day like today, my concentration is on reviewing and revising stops, buying a little bit more of stocks that I own on either arbitrary weakness or on strength. Added some APSG near the bottom today on the weakness side and added to CENT on an intraday pullback on strength.

The general market is sleepy and the volume is quite low. The thinness can contribute to the volatilty but so far that volatility is within a reasonable range.

If I didn't have so much inventory I would be looking to buy in these areas, but given the inventory I'm fairly inactive. Keep watching for the strength to develop here but so far the follow through to either side is lacking.

We are being reminded this morning that practically nothing is a slam dunk in these markets we deal with. The early pessimism was bought, the exuberance sold and the volume is hard to read given the holiday thinness. I was rinsed out of my INTC trade for very small profits and the only other thing I've done is to restart a position in IMOS. Looks like we could trade it on chip strength if that occurs.

I'm really pretty much on hold here seeing good strength in some of the issues we hold like BCON and EZPW while a few or dragging as well. Trying to be patient.

The almost inevitable pullback occurs and now we get to see where they really want to take things. Internals improving and underlying indexes look reasonably good. I'm not really pressing and just missed the INTC add on the pullback. Waiting and monitoring as we have a lot of inventory on the table as is.

The dip buyers were quick to jump all over that lower opening and they took us to green in fairly short order. I'm looking to add to the INTC trade on a pullback now. Early numbers are not positive on the internals but that's a function of the opening. Let's see what they look like an hour from now.

Buying a little INTC premarket for a trade down 1/2%

With most European markets mixed and the Asian markets closing higher, the futures here have risen somewhat from overnight lows. The raising of the terror alert indicators seems to be the main cause.

There's a takeover in the drugs with Pfizer making a bid for Esperion. Will be interesting to see how the drug sector will react overall. Dollar is weaker yet again and we have no economic data today. Lots tomorrow and Wednesday. Also we have shortend trading days on Wednesday and Friday. Factor in seasonal tendencies which are also positive for the coming weeks.

Given all the above, starting out a bit weak after last weeks jaunt higher is probably a positive. Climbing the wall of worry is a better way to advance as it can more likely be sustained.

My concentration this week is primarily to nurse along the inventory I'm holding. With thinner trading volumes, we will have to be diligent is watching stop levels and deciding if they are coming on volume and mean something or whether trading is too thin and we have to absorb the short term small selling and pull the stop. With this many positions open, most longs have stop order in the market at this juncture.

I'm looking for continued strength this week as some rotation back to the smaller cap stocks should begin to occur. With a short hedge on the SPY and DIA, I'm thinking we can make money on both sides over the remainder of the year.

Market never really completely recovered from the rumor of imminent threat on NYC today although we did see some late day buying. I continue to maintain a bullish position into next week thinking that we will see some of the January effect begin to kick in. The wrap is pretty short for now. I've started posting during the weekend when/if I find something while researching and preparing for the next week so you need not wait until Monday if you have interest in the thoughts.

Have a great weekend and a happy and safe Holiday Season. We do come to these offices each day to trade for a living but living is what we all need/should do and that means enjoying family and friends while there's still breath in our lungs. Until next time ...

Market starting to spike a bit here into the close. I had pretty much written it off and then right around an hour to go, they start the push. It's late enough that it may well stick into the close.

I'm doing little here as I've added enough already. I'll save the remaining capital to add later if we can. Been watch MNC pretty closely as I want to add into further strength there. Distribution from someone at the $24 level keeps coming. At some point that seller will run out or walk away and then we should spike. I'm going to try and add when that happens.

Markets really haven't been able to recover from the earlier rumors of an imminent threat is NYC. On the flip side, they've pretty much stablized at lower levels ... for the time being.

The internals turned negative and are holding there. For my part, I took a loss on the INTC holding and simply moved aside for now when the lows of the day were taken out a bit ago. Added the DIA short back on the sheets for hedging purposes and am simply counting down the minutes so that we can close the books and call it a day and a week.

Despite the bump in the road today, I think you have to continue to lean long here and I expect to see the OTC issues to lead the market up further next week and possibly the following. For that reason I'm staying long. I'm using the SPY and DIA as short hedges thinking that at some point they will definitely come back in and make them worthwhile. In the meantime, they provide a hedge for the long exposure. If we are correct in the thought of OTC outperforming listed in the days ahead, then it should work well.

The imminent danger alert is being knocked down from a number of quarters now but we aren't seeing a serious push back up yet. With 3 hours to go, if we don't get that move up by 1pm EST, don't expect it. Options expiration is likely positive this week as judged by the action this week. I've done little and watched gains whittled away given the weakness. I don't see a reason to change positions here but instead absorb the body blow as next week will likely see a resumption of the higher moves barring an exogenous event.

With the conflicting news on the imminent threat accusation, the market has really taken a breather. We were beginning to gain momentum and now we have uncertainty before a weekend and that gives pause. Unless this rumor/report is discredited from an authoratative body soon, it's likely to gain steam. I've not done anything as a result of this, but will likely cut the INTC loose if we traverse too much lower and simply stand aside in that space. For the most part, I continue to review existing positions and potential new ones. With us being roughly 60% long now, 11% short and the rest cash, we are naturally at a pausing point on any aggressive adding and am looking at particular issues carefully for further adds.

Markets took a good sized hit on the ABC news breaking that an imminent threat exists for a suicide bombing in NYC. This may in fact cause others to book gains to reduce weekend risk which was the thought we suggested in an earlier post. It's that better safe than sorry mentality and we could see it play out this afternoon.

The portfolio is becoming crowded again with something on the order of 30 positions open. Usually I'm beginning to max out around this number. The way I keep track of things is sort the list realtime by percentage gains/losses and concentrate on those stocks at the top and bottom. Of course there are other lists for stocks that we may want to add that are sorted the same way.

Another thing I typically do is to add stops to most positions when there are obvious places to do so ... so I don't forget them. I typically put a bell reminder on the stock so that as the price nears the stop out area, I'm alerted and can take a quick look to see if I still feel the same way, want to change the stop price or reduce the number of shares I'm letting go, etc. Just active management of the portfolio as I always stress here. As I've said many times before, if you actively manage your portfolio and don't allow losers to deplete your capital base, even with a string of hard times, you will always be there to make the money when it counts. Think about how you manage your portfolio and see if any of the above helps you to do so better.

Market taking a quick hit here as I was writing. I'm looking around for a reason.

With the chips and biotech turning green and the internals starting to follow suit, I'm looking to hold longs and continue to look for adds in the smaller caps. Also wanting to work INTC for a trade higher still as well. Risk/reward not nearly as interesting as it was a couple days ago but still works.

The underlying indexes are showing continued follow through. Software is the big minus thus far on technology and financials are strong so far. Looks like we could squeeze higher before the day is out with that late day strength once more. Another possibility is that we see some gains booked into the weekend as used to be the practice when we saw up weeks during the week. Will have to play it by ear and see but with Christmas next week and that usually playing positive, I wouldn't try to game just today but continue to play it long for the coming week or so.

Covered that DIA short for small profits as this market battles back again. Sure I will put it out again at some point, but timing is key here to get maximum effect on such a broad short.

I like the way the market is acting and continue to press on with the longs.

Ever since Monday's bear reversal and a bit of Tuesday's early action, this market (listed issues) has risen and risen steadily. The listed issues stand at yearly highs now and will likely see some topping action come Christmas. On the other side of the big equation, the NASDAQ is just starting to rev it's engine. After playing with it's moving averages for a few days, yesterday it began to lead the way with a strong performance. Over the next couple of days, we need to see if that strong performance in the OTC has legs. If it does, then the January effect is starting to kick in and we can try a

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