Fluor (FLR) @ mid $160s - FILLED!
Mastercard (MA) @ low $240s - FILLED!
Now that is a positive step. However that does not mean this is "the bottom". Certainly I could see the way things are going Fluor fall to it's 200 day moving average of mid $150s and Mastercard down to just under $220. Or maybe they stop here and reverse - but at least with technical charts you have some sort of roadmap. And I cannot stress that once again, this is simply not a buy and hold market. Even the best stocks eventually are being taken to the woodshed, and I'm not talking the cursory 5-10% correction that happens in long winded bull market movements. Mastercard, probably one of the safest fundamental stories in my universe, just dropped 25% in a matter of a few weeks. These are serious corrections that erase all your unrealized gains - in just a few sessions. No matter where you are hiding. Hence I'd rather pay taxes (our last sale in MA was in early May right near $300) and lock in gains along the way instead of giving up all our gains and saying "hey no taxes if you buy this fund!" If we are in a bull market, we ride the trend and make less transactions. This is not a bull market (in case you did not get the news alert)Again, the one gap I am keeping my eye on is this one below - it would make me much more bullish if this one filled as it would signal complete "throwing in the towel"; but with the "tech is a safe haven" thesis maybe it won't. Or maybe an earnings disappointment will be needed to do the trick. Or maybe it will "never" fill (I doubt it)
NOT SO FILLED!
[May 16: Fluor as a Wind Play? $1.8 Billion Says Yes][Apr 29: Mastercard Continues to Impress]
Long Fluor, Mastercard in fund; no personal position
19 comments:
I started my career in stocks looking at nothing but charts. But thinking back, I don't know how I ever managed without fundamentals. It would be a scary place without them and the conviction that goes with it;D
yep, eventually the longer you do it - the more you all converge in the same spot. But you still tend to lean MORE on what you started with (in your case I assume technicals) In mine, still fundamentals.
AAPL has the i-phone launch and GOOG has the benefit of the ongoing MSFT/YHOO fiasco. I'm not sure I would wait around on them to fall hard to confirm a bottoming in the overall market. These two stocks specifically both have nice catalysts going for them at the moment.
hmmm... no catalysts in natural gas, fertilizer, or coal eh? ;)
fundamentals mean nothing in panic.
I am not saying they have to break down. I am saying it would more easily delineate a bottom
Even Big Lots now approaches its 50 day moving average
Or for that matter Fluor (building wind farms, building polysilicion solar plants, building oil-gas infrastructure) or Mastercard... all have great fundamental stories but still get trashed.
Nothing unique about Apple or Google.
Another chart with an intersting gap is one of your favorites, MOS. Think it will get there --- especially since it is right around the 200 day EMA?
MOS always tricky because she always breaks right below 50 day moving average, causing me to cut back, and then reverses and she sneers at me for daring to sell her. She did that to me in late May - I remember because of all the comments to not fall for the selloff. :)
But $110 would be a wonderful buy point for her.
I forgot STP @ $31 as well.
Scary gap of the day - does ENER $36 fill? Or is that one of those that "never fills". A few spots on ISRG multi year chart never filled.
Or maybe a miss in a few quarters will cause an ENER plummet. Inquiring minds want to know.
You have a point TM. I have a quick novice lik question. I have primarily been a fundamental type of investor, holding stocks for quite a long period of time, and never really looked at charts for making any investment decision. I have started to see a need for them now. My question to you is very basic or stupid so to say - why do you look at just daily charts and longer time horizon like weekly or so. Stockcharts give you the option to do so.
Again you dont need to answer it if you think its stupid.
Thanks
Hi Harsh
I almost never look at daily charts - that is more for daytraders. The only time I look at them is maybe if I look at a 5 day chart and want to see if something suspicious is happening. Like say, a ton of put buying 2 days ahead of bear Stearns implosion (that the SEC never investigates).
Generally I'm looking at 1-3 month charts. Then I explode it out to say a 1 year or so to see if there is any significant resistance or support. But I am about 1/10th the technician that many readers here probably are. I use them as a general guideline, and its an art not science. As is all investing really.
I'd also say in a bull market they are less critical. Many people who entered the market in 2003, 2004, 2005, 2006 had no need for charts because if you pick the correct stocks they just went up on a nice slope.
I want to say one more thing. If you have a VERY long term outlook and don't watch your stocks every month there are some stocks you can just buy and hold for a long time and ignore the week to week or month to month noise. My contention is however, that in a flattening world where competition is hyper intense, that universe of stocks is far smaller than it was in the 1950s 1960s 1970s 1980s. With these names I am talking the Procter & Gambles or Johnson and Johnsons of the world. Someone would say, wouldnt you put Microsoft in that area or Cisco? I'd say put up a 10 year chart of either and if you want 0% return sure. Same with GE.
There are very few widows and orphans stocks and as new players come to us from the developing markets, there will be fewer by the year. Many think Exxon is something you can hold for 10 years - their replacement rate is not so great and I think Petrobras will surpass them over time. But if you look at top holdings of many mutual funds they just sit stubbornly in Exxon. I could envision a scenario where Exxon is half the size it is now in 20 years (or less) - Unless Iraq is handed to them of course (which might be likely) :) Thank you Mr Cheney. But you get the idea. Even in 20 years I think we will have made wholesale changes and the combustion engine will look very different - wind, solar, et al will be serious players, battery power will be or something we have not heard of. Who knows. But take everything in 2-3 year increments and I think it's easier to find trends. 10+ years is useless in a world that is changing so quickly.
STP -- Seems almost a sure bet to fill.
ENER -- Oooh...now wouldn't that be something. They are priced for perfection and lord knows they ain't perfect. But missing a couple quarters in a row ... feels unlikely with their new management but you never, ever know.
MOS -- A buy at present prices, a STEAL at 110.
yea i was like you in that i started with fundamentals and then found charts as an added bonus to add to the investment research arsenal. hybrid style ftw!
got filled on both MA and FLR early today and as always don't have full positions in them yet so hoping they go lower. but, i think MA selloff is done for now. let's hope i'm wrong haha.
ENER is interesting, glad you brought that up. I've been writing a post on it but haven't put it up yet because I can't decide whether to play it now (with a tight stop just below the 50 day) or wait/hope/pray it fills the gap. i don't think it fills the gap honestly unless we get some news of subsidies being cut off. some major catalyst would be needed to bring this thing down from the stratosphere, especially since they've had a profitable quarter now.
My 3 cents: 1) charts are good; 2) fundamentals are good; 3) nothing is perfect; 4) good luck is good to have; 5) bad luck is part of the game; 6) they don't ring a bell when things change; 7) market research is important so you can determine what works and what doesn't; 8) buy low and sell high
Some very good stocks at very good prices in many sectors now. This is different from even a week ago (generals were still smiling untouched then)
Just waiting on market to calm down now.
Still believe 1 last purge is necessary but happy to be incorrect.
Still of the belief we might get some relief rally on the "world is not ending after all" multinationals earnings season - even though there will be warnings galore of input costs and 2nd half 2008. Pundits will begin to say "look through that and its all rosy for 1st half 2009" :)
Waiting.
What a coincidence to see your post on MA and FLR .. I traded both lately and made money on the downside until they filled the gaps and am now in green again once I reversed my trade.. Guess that was pure luck as I agree that technical trading is not always profitable. ;).
Cheers.. Pankaj
Pankaj, let me know when your mutual fund is up and running. You are destroying me ;)
I was hoping to be greedy and wanted to get those 200 day moving averages.
If this is "the bottom" than its The Guy (tm) bottom. He called it within 24 hours. We shall know by tomorrow afternoon I believe.
Or it could just be a very mean market playing the upteemth trick on us. ;)
hehe... Never going to form one as long as your fund(Rising Tide) is around.. I just jump in the market once in a while and I do not make profits consistently.. I plan to leave it to the experts mostly and am not the expert by any means..
Happy to be in green today though and cheers to that.. :)
Ok, make sure to post some of your losses so I don't feel so dumb for not loading mastercard at $244. :) When you only post victories I assume you are 100% in victory lane.
ok... For a starter, I lost badly on my MEE puts.. damn! I loaded too early at 85 and then it popped to 95, only to tank to the 70s at a later date when I was already out of that trade with losses booked.. Guess what, my charts told me to get out at a hefty loss, only to prevent further losses as I thought it could break out to new highs like its brother ANR did.. :).. Am kicking myself for that trade..!
Cheers..
hmm.. I am so slow.. I guess u were being sarcastic when u said make sure I post my losses.. ;).. failed to see that smiley.. hehe... Anyways, now u know i am not in 100% victory lane..
cheers..
Post a Comment