Equity Market Comment 09/13/07

Do not get hood-winked into this rally we are currently seeing in equity prices.

The work continues to suggest strongly that the complete re-test has not run the course and this rally we are having now is NOT the starting point of a new intermediate term move up.

The hourly chart gave a sell signal today and the work continues to call for lower prices in the 1412 to 1432 area on the S&P 500.

Aggressive Traders can look to purchase put options in here for a potential of 50 or more S&P points.

TREND ANALYSIS MUTUAL FUND

In order to give you a head start I am posting the buy candidates for what will be titled the Trend Analysis Mutual Fund.

The mutual fund will be posted in the sidebar along with the appropriate statistics. I have laid this fund out to achieve aggressive returns while taking below average risk. It should out do the major averages handily.

The following are the stocks and each will be given an equal weighting from the start.

CPX, FMD, AXS, TCK, MEOH, PTEN, BJS, WPC, MTEX, ACAS, ARLP, CT, ASPV, PHLY, DB, UBS, JPM, BAC, TNH, ABR, PSP, PXN, PHO

Please keep in mind that these stocks have yet to be purchased, but as soon as they have been purchased I will then set up the sidebar on the blog to track the performance.

SHORT COCOA

LUMBER - Stopped Out Today - Loss 17.3%

Stopped out of the long lumber position put into place yesterday.
Lumber remains on the watch list for re-entry on the long side.

Equity Market Comment 09/12/07

Nothing really new to report on the equity markets.

I continue to look for the completion of the re-test of the August 16th low, with the blue line supports on the chart as targets.

Once the market has this re-test out of the way then it can begin what I think will be a massive leg up. The 4th quarter of this year is setting up to be a humdinger!!

I will try and post the buy list tonight or tomorrow. It will be kept track of on the side bar under the title of Trend Analysis Mutual Fund.

NEW COMMODITY TRADES AND WATCH LIST UPDATES

Long Lumber Today @ 245.70

Tight Stop @ 243.10

Gander Mountain - Testing The Limits

While Gander Mountain has tested my patience to say the least, it reached a low risk buying area today.

I continue to believe that patience with the stock will be greatly rewarded and an average down in the stock would be a strong option.

AGL - BUY ALERT 09/11/07

AGL has some serious upside potential as it has lost all of the downside momentum it had garnered since the double top.

The fundamentals are also improving and the combination of this and a strong technical position should prove very beneficial to the stock.

Equity Market Comment 09/11/07

While this last leg down in the equity markets has taken a longer path than I had anticipated, I still remain firm in my view that there will be one more push lower before the next major leg up will begin.

The target of 1409-1412 on the S&P 500 comes up again and again in my work on all different time frames, so keep a close eye on this level.

The word for now remain CAUTION!

Caution on Notes and Bonds

The very strong move we have seen in the fixed income market may be coming to an end on an intermediate term basis.

This is NOT to say that the bull market is over, but with the hefty move in prices and the profit therein, it would be wise to exercise caution in here and take some if not most of the chips off the table.

NEW COMMODITY TRADES AND WATCH LIST UPDATES

Average down the Long Dollar Position as a potential panic selling climax may have occurred today.

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See Sidebar for most recent trade action.

Long October Hogs at the close today.

Equity Market Comment 09/10/07

We continue to look for the re-test of the lows to terminate on Tuesday or Wednsday of this week with the 1412 level coming up quite frequently in the work.

Get ready to make your purchases.

LOW RISK SHORT AREA - ULTRA SHORT TERM

Seeing as Mondays time frame for a low passed without event, the probabilities of further decline remain high.

We have a good area to short the market with a tight stop of course.

WHY THE PERMA BEARS WILL BE WRONG AGAIN

With all the talk of the 1987 all over again and the perma bears coming out of the woodwork preaching their doom and gloom of the most recent mortgage problems, I thought it fitting to show some very strong evidence as to why we will NOT go into a bear market and quite the contrary should have a great rally.

The chart below is of the Commercial Traders (Blue Line) and you can clearly see they are very heavy buyers and have been very heavy buyers. This is the smart money that is in the know months before anything hits the press and the public reacts. You can bet your bottom dollar if they thought this problem would snowball into a potential financial collapse then they would not be such heavy buyers.

The action of the Commercial Traders is very bullish for equities.

The Green Line below is the Commodity Fund Traders who typically ride the major trend until its extinction. The Fund Traders are wrong about 90% of the time at major turning points in the markets. As you can see, they have been very strong sellers, which is also very bullish for stocks.

The combination of the Commercials being such heavy purchasers of equities and the Fund Traders being such heavy sellers points to one inescapable fact. Equities will not enter into a bear market and should over the next 12-18 months have an incredible run in prices.

NEW FEAR INDEX

The chart below tells the story of the fear index.

The Red Line is the S&P 500 and the black line is the fear index, which is nothing
more than a measure of investors flocking into the safety of Fixed Government
Securities.

When we see the flocking into government securities as equity prices are in a potential free fall, the fear index will move to a level showing the outright bearishness of market participants.

The fear index currently tells us that we had a climax bottom on August 16th.
This also confirms the outlook for a final re-test which we are nearing the end of right now.

FORD MOTOR IS A SCREAMING BUY!!

Ultra Short Term Work Calls For More Decline 09/07/07

The 50% retrace of the ultra short term trend today continues to call for lower prices probably right from the get go Monday Morning.

Remember, use this weakness to cover the rest of your hedge and purchase good quality stocks and options as the next move to the upside should be a great one!

NEW COMMODITY ALLOCATIONS 9/6/2007

See commodity outlook sidebar for latest commodity trades and updates.

Equity Market Comment 09/06/2007

The S&P 500 rallied to the 1480 level and retreated, so it appears that the ultra short term counter rally is complete.

From here the market should complete the retest with downside targets of:
1451
1432
1412
The most logical being 1432 and 1412.
Look back to Tuesdays post for the potential bottoming dates.

New Commodity Transactions & Aggressive Equity Trades 09/05/2007

Check the sidebar for the selling of the long in cotton and a reverse short.

Check the new equity recommendation.

USEC Corp. - BUY Initial Position

USU is starting to look like it has put in its low.

Begin to purchase the stock or stock options now, with a 1/3 allocation to your full line.

Equity Market Comment - 09/05/2007

The first leg down of the decline to test the lows looks to have been put into place.

From here I would expect a rally to the 1480 area on the S&P 500. It may not happen right away, but if the market does rally to this level and then rolls over it will be an indication that the final leg of the re-test is getting under way.

I realize that there are quite a few resistance levels on the chart below, but don't let that confuse you. The main area that deserves attention is the 1480 area.

Move The Buy Stop to 3.72 1/2 On Corn

NEW AGGRESSIVE EQUITY TRADE ON SIDEBAR - 09/04/07

Don't Get Pulled Into This Near Term Strength!

NEW TARGET TIMES FOR CORRECTIVE LOW -

Mon. 9/10/07 10:30 am
Tues 9/11/07 12:00 pm
Weds. 9/12/07 1:00 pm

While I would certainly like to see the times on these days prove to be correct, the nuts and bolts of the work is based on the dates. The actual times are just gravy, so please do not get the impression that I am trying to pinpoint this to the exact second.

Short Term Condition of Equities

Equity Comment 09/03/2007

There is alot of information on tonights chart of the DOW, so make sure your print it out for reference.

In a nutshell:
1. Look for the market to correct here and begin to cover your remaining hedged positions.
I do not think the correction will be very deep, but anything is possible. Aggressive traders can look to go short in here. We went short on Friday.

2. The market made an impulse move off the lows, so this decline should be nothing more than a corrective wave and the major intermediate term low should be in place.

3. If the most recent lows are taken out, I will get downright bearish and continue to apply my hedge. However, the data that we are getting from the commercial traders does not point to a time for any type of bear market, not to mention that the camp of here goes 1987 all over again is growing in size. It may have some similarities time and price wise, but the mother of all indicators....THE COMMERCIAL TRADERS NET INDEX is nowhere close to where it was in 1987. In 1987, the big boys were selling strongly in both July and August! Just the opposite holds true today. They have been very strong buyers and they make the big money so it would be silly to bet against their positions.

PIVOT POINT AUTO TRADER

There is going to be a new addition to the blog and it will be a completely automatic trading program based on Pivot Points.

Everything will be completely Black and White and will leave no room for second guessing.

The program will be based on aggressive trading principles, so please utilize only trading resources allocated for this purpose.

If you have any particular stocks that you might like put into the program just drop me a line and I will see what I can do. The candidates for the program must be stocks of an active nature and sell above $5.

Long Term Health Of Equities

Short Term Trade Opportunity

NEW AGGRESSIVE EQUITY TRADE ON SIDEBAR

Equity Market Comment - 08/30/2007

I continue to look for the market to move lower in the process of a re-test of the lows.

There does remain upside potential to 1484-1486 before the decline gathers steam.
If the S&P 500 gets to these levels, it will be a low risk shorting opportunity.

The Downside target of 1414 to 1412 has come up through numerous calculations so there is some confluence amongst targets.

New Commodity Recommendations

New Commodity Recommendations Are Listed On The Sidebar Today.

There Are Some Great Opportunities.

Short Term S&P Trade

Have an excellent short opportunity in here.

SHORT OCT Crude

Crude Oil is in an area that a low risk short can be put in place.

Keep the stop tight.

Corus Bankshares - Incredible Value Long Term

CORS is also on the buy list for new purchases once the re-test is complete and the all clear is given.

Take a look at how well run this bank is and the extreme undervalued nature of the stock price.

While the sector has had its share of challenges recently, the stock should give an incredible return over the long term. This is all without even mentioning the almost 7% yield on the dividend.

Dean Foods - Buy Candadite

Since the sell signal that we got on Dean Foods the stock has been in an ongoing decline.

It is starting to look attractive in this area and has also made the cut in our fundamental screening as well.

With this in mind Dean Foods is going on the buy list once the dust settles on this re-test.

08/29/07 Equity Comment

The markets certainly seem to be coming together as anticipated, although at a faster clip then I had expected.

In one day the S&P 500 reached its upside target, a feat that I had thought would take 2 or 3 days at the minimum.

The scenario now calls for one more push lower to complete the re-test of the S&P 500 lows at 1370. I am looking for 1412 on the S&P 500 for the final re-test target level. It will be at this point that all of my hedges will be covered and more equity purchases will be on the fore.

These market movements have occurred so quickly that I have yet to post the buy list, but I will try and get around to it over the next couple of days if not the holiday weekend.

Add To Short Position In Corn

It has been a very busy day in the commodity markets with all kinds of set ups and near set ups approaching.

Sitting on a substantial profit from our long term sell signal in corn, it looks like it is time to add short contracts to the position as corn looks very vulnerable in here. Add to the December contract at your discretion.

Soybeans offer a short sale opportunity as well, but corn has the stronger sell signal.

Very Aggressive Cotton Trade

Very Aggressive traders can purchase another December Cotton contract as it looks as if the first leg down has been completed.

While I had originally anticipated that Cotton would wage one more rally to new highs before the downside action would begin, it appears now that the most recent high at 68.80 is in fact the top and we have just completed the first leg down.

A rally back to 62.75 looks like a logical move from here.

Please understand that this is a very aggressive trade and is not for every commodity trader.

Set the Sell Stop at 56.60 for a total risk of $450 per contract.

New Commodity Alert

Risk is very limited in here and I did receive numerous buy signals today on the Dollar.

We are long the Leveraged Powershares Dollar fund and have the stop basis the cash dollar index at 80.50 on a close only.

USEC Corp - Getting Close to the Buy Zone

Keep and eye on USU as the market continues the re-test of the lows.

It is one of the stocks that we are going to re-purchase once this short term decline is out of the way.

The lows just below $13 should be strong enough to hold any further selling in the stock.

Equity Market Comment

The short term decline continued today with quite an impressive show I must say.

I continue to believe that this is merely a re-test of the lows, but it should also serve to get the few bullish stragglers into the bear camp. Just in time for a sustainable rally to ensue.

Get ready to unwind the majority of your hedge on this re-test!

Short Term Long Stopped Out

Appears we were a little early, but the close stop once again kept our loss very limited.

Look to buy back in on if a rally ensues in the last 20 minutes of trading.

Short Term Trade Opportunity

The market has sold off and looks to have completed the first short term leg down.

Aggressive traders can go long in here and buy call options with a stop just about a point below the most recent lows of today.

Equity Market Comment

The stock market appears to have begun the process of testing the lows established in mid August.

While some of the models have yet to give sell signals, there seems to be enough evidence that we are entering into a short term decline.

The model continues to call for Sept 5Th as the date for the low to occur. So from here to now it would be prudent to get all our hedges covered as the market declines and to begin a process to add to existing quality equity positions.

I will be positing my buy candidates in the next few days.

New Addition To The Blog - Commodity Outlook

In an effort to make my blog more useful and also to save time, I have added a new feature that will be located over on the right hand sidebar.

It will list all of the commodities that I see as potential trades and the condition of these markets.

It will also give instructions such as Buying Weakness or Selling Strength as a guideline to the health of each individual market. There also may be a reference to a specific trade that was put into place and the net result or ongoing status of such trade.

Each entry will also have a date that will indicate when the last update of that particular commodity was. The list will also be put in order of importance, with current trades at or near the top and upcoming opportunities just below that.

This should really help to save time in the assessment of each market, although from time to time there will be posts on specific commodities with charts as needed.

If you have any suggestions on how to make this blog better in any way shape or form, please feel free to drop me a line. I have gotten some great feedback and this new feature is in answer to quite a few reader suggestions.

Dow Jone Transports & 10 Year T-Note Yields

I have talked about this in the past, but I thought a re-post would be a good idea considering the correlation continues.

THE LONG TERM PERSPECTIVE ON INTEREST RATES

The monthly chart of the 10 year notes yield has some very bullish implications for interest rates.

According to this long term chart, we should see rates work lower and dramatically so over the next 12- 18 months.

Take a look at the chart and see for yourself.

TNH Update

Terra Nitrogen offers some excellent value and the most recent pullback followed by the 8 day rally has confirmed the bullish posture I currently have taken on the stock.

Look to purchase the shares on a pullback.

Short Term Top

While the reflex rally off the most recent lows was quicker than I had anticipated, it has reached a point where caution must be adhered too.

I continue to believe that an intermediate term low was put into place on August 16-17 and that a re-test of these lows should prove successful. However, there is a bit of short term complacency hitting equities right now and a decline in prices would be just what the doctor ordered to weed out this short term bullishness.

Short term Stock positions and call options should be closed out and preparation for the last leg of removing the hedges from stock positions as the market moves lower should be the battle plan at this time.

Evidence Of Retest

New Aggressive Stock Pick

Below you will find ALIF that will be added to the Aggressive side of the Equity Portfolio.

This is a highly speculative issue, but it offers some incredible return numbers.

The stock has potential all the way to $8 and with a stop at or very near the most recent lows the risk is very limited.

Take a look at it!!

Strong Intermediate Term Bottom Confirmation

The turning up of the Point and Figure Sentiment chart is great news for long term investors.

This helps to confirm that the most recent lows made are in place and a re-test should not break below these established lows.

This is very reliable.


Even more reliable for a confirmation of an intermediate term trend shift from down to up is the move higher in the Three Line Break chart of sentiment. The key here is the turning up after a new low was put in place on the sentiment chart.

All in all, these signals tell us that once the re-test of the lows begins, then it will be time to cover the rest of our hedged positions and look to add to the long side of our portfolios.