AnandCraft Daily – Updated 9/27/09
Anand (9/27) : I can’t help but be nervous about this rally which is up 50% from the March lows. The price action an breadth has been astounding, but some danger signs still exist. The Chinese market is still consolidating and sitting on the 50 day moving average. RIMM ( a market leader) dumped 17% on Friday on massive volume. BRCM is breaking down on increasing volume. The Dow, Naz, and the Banking Index are all doing fine however, so we need to give the market the benefit of the doubt, even mine!! Still though, I’m uneasy, which means its probably a good time to go long! I admit it, I’m a chicken, but I like my cash waiting for a nicer correction. I’m still slightly long DBA, Gold and will step my toe into a Nasdaq Short ETF (PSQ or QID (double short). I that starts working I will add on more…
Anand (9/23): Just a quick note, we had a significant total market event today. We had a “reversal” day which could indicate the start of a trend change in this case down. The market opened higher and closed lower. More importanly it closed at the lows of the day on all the indices and there was a brutal sell-off at day’s end. Why is this important? The last hour and even more so the last half hour is when instituitons and big boys trade. So what happens at day’s end is a good signal. The last hour was a quick 170 point drop on the Dow. Thsi may be significant, but one day doesn’t make or break a trend, but we’ll see. Maybe this will usher in the much-needed 10% correction so we can have a sustained rally and not get buried like 2002 again after the rally off of the 2001 lows.
Anand (9/22): Today was remakable on several fronts. MPG, a stock we mentioned here on September 16 at a closing price of $1.33 went absolutely ballistic. It closed today at $2.70 !!!! up 26% for the day and a total gain since we featured the stock of 103% in just 4 trading days. Way to go Ken, too bad I didn’t get any 
Of course no one could predict this kind of action, but remember all you need to make your year are a few big winners. This certainly already qualifies.
Many stocks aere making new 52 week highs including important tech bellwethers and leaders like Google, Broadcom, Novellus, KLA-Tencor and reatilers like Gap, Nordstrom and J Crew (and my favorite Ross Stores too!). The advance still seems broad enough, I don’t know when the turn will come, but it looks like we will have strong leadership to count on in late September which is RARE. September is supposed to be the worst motnh, on average, of the whole year. We could be in for a seasonal inversion which means that traditionally strong December could mark a top. Another significant event today is the continued strength of commodities including oil and gold which looks like the inflation trade is back in. Still it is a market of stocks and not a “stock market”. Stock selection is the key, look throughout this site and you will get some great ideas.
