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Why am I bullish? Two long basing periods and now breakout. Sometime we get blinded by the Naz and Qs. The broader market is banging out new highs. Kinda simple IMO.
Note the magic blue line. It has been on this chart for sometime.
Old Fool Notes – 03/04/06
I am tempted to call Friday a tie but the bears did end with a slight edge. However, not before the bulls gave them a real scare. The volume was very high at 2.4 billion with a very close ratio of 1.2 to 1 in favor of the bears. It was a pretty good day for day traders if you happen to play that game (I wasn’t – way too busy Friday).
The daily channel chart continues its flip flop way up the channel – still sticking close to the best fit line. We ended the day with an ominous looking candle and the OBV did another crossover. Not enough of a negative signal to say bail out but you should certainly keep an eye open.
The hourly chart presents a slightly different picture and that might be good or bad depending on your interpretation. On the positive side, you can see that the latest up channel is a series of higher highs and higher lows. On the negative side, you might note that nasty last hour and the rapidly contracting Bollinger Bands. This suggests that the bulls need a nice, slow but steady push on Monday. There is a lot of upside resistance shown on the hourly chart starting at the blue line – about 2313 – and extending all the way up to about 2235. There are also a number of support levels on the down side so we should see another battle royal on Monday. Things could get ugly if the bears managed to push all the way down to 2280. That is the major support level on both the hourly and daily charts.
Another positive sign is the weekly chart, which suggests that we are still strong and in good shape all the way down to about 2200. I really do not care to test this chart.
Finally, the ratio chart continues to give us no signal. However, it did not do another full flip and the bulls need a good day to force another flip over.
I had only one trade on Friday and that was a sell on half of my AKS near the close. Harvest the crop when it gets ripe. It has been a very good Jan/Feb for me – I have already hit the halfway point on my yearly dollar target. So I plan to ease back on the throttle a bit. All of my broad indicator charts just continue to track sideways and are not showing any real signs of break out or breakdown. The primary signals (price action) are slightly bullish but not strong enough to make we want to rush out and buy. No signals to sell either so I am just going to hang out and wait. I see no reason to be in a rush.
Have a good weekend,
The Old Fool
Old Fool Notes – 03/02/06
The bears made a good try but could not get it back below 2300. In fact, they did not make a good dent since we were only down 4 at the close. Volume was good again at 2.1 billion with a ratio that was a dead tie.
The channel chart is also still flipping on the OBV. All other indicators are still in good shape. Just tracking along nicely on the best fit line of the channel.
The ratio chart reflects the flat trading by flipping again. No signal here.
My only trades today were sells. I sold half of the RAD and another 10% of the JDSU at the close. Playing with all house money on the JDSU now. Cost basis zero and 50% of position still left. BOOYA. Seriously, the pressure is still up. Some folks see this as topping action while I see it as consolidation. We should find out soon.
Have a good evening,
The Old Fool
Looks like it was a tough day at the mines. Takes guts.
Below is the full picture if you want to discuss anything.
Real Time
Old Fool Notes – 03/01/06
We had a lovely day today. Volume was big at 2.2 billion and the ratio was huge – 4.5 to 1 in favor of the bulls. That’s a bigger ratio than I would like but never look a gift horse in the mouth. We now need some follow through to make this stick. Based on the hourly chart, the door looks open to 2325 and, baring something unexpected, that move should be fairly easy. The next 10 points (2225 to 2235) will shape the battle and is likely to be very tough.
The daily channel chart is in firm bull control and I should note that there is a ton of support below. We are up against the upper Bollinger Band so a small pullback early would not be out of the question.
I have already mentioned the hourly channel chart above and have included it for your perusal. There is no Bollinger Band problem on this chart.
The ratio chart is still flipping back and forth around the 21-day EMA so there is no signal there.
Went 100% long in baskets on the early pullback and sold back to 60% on the closing sag. I thought the drop was going to be worse than it was. Sold another 20% of the JDSU that’s been molding over in the LT port. Still have 60% and it is very close to all the house’s money so I plan to hold on to that for awhile. I’m not going to get in a hurry tomorrow. If I were the chief bull, I would let the sellers have the open if they want it.
Have a good evening,
The Old Fool
The blue line opens the door higher.
AI
