Sunday, June 17, 2018

Market  is  Efficient


I know some of you react to every piece of news out there that can possibly affect the market on any given day.  You start getting nervous and start looking over your stock positions closely.  Its the very wrong thing to do to get your emotions all worked up.  Pretty soon you make decisions based on your emotions and neglect to look at the data.  Markets have all the facts and its all factored in.  We have tweeting Trump talking about tariffs since March of this year.  North Korea has been in the news for years and its nothing new.  European central banks had already mentioned in September of 2017 that they will start winding down the easy money policy.  None of this is a surprise for the markets.


Currently the market is still acting bullish and we have just 8 distribution days - only 2 of them are in the  $NASDAQ  and 6  are in the  $SPY.  Its important to look at the stock charts.  Look at the daily chart but also at the weekly charts.  It is a graphical expression of what the price and volume is on any given time period.  One day performance of the market doesn't really make a difference.  Its good to look at the weekly charts to accurately determine the performance of the stock.  It helps us assess the data and not close out our positions prematurely. 


Market  Performance 


Looking over the average performance of $SPY over the last 50 years, June delivers  +0.02%  on average.  Its a sleepy month usually.  This year however, its quite different.  For the first 2 weeks of June so far, the performance of the 3 major indexes is as follows:

  1. $SPY     ... +1.29%
  2. $DJI       ... +1.85%
  3. $QQQ    ... +2.45%    

That is a stellar performance so far.  If you paid too much attention to the news, you would think that the market would derail and the follow thru day we had 5 weeks ago would start to fumble.  That did not happen. This is why one has to discipline themselves to look at the data and make decisions based on that.  There are no opinions or your personal bias in the picture.  I can gurantee you that the hedge funds have taken every piece of news into consideration before committing their money to accumulating shares of the company of their choice.  That is why we as retail investors take our lead from what the institutions are doing.  They account for over  75%  of the total volume in the market on any given day.  Stock charts gives you a graphical expression of what they are doing in the market. 


Stocks  to  Monitor



Institutions usually make a major dollar commitment when they start initiating a position in a stock.  It may take them several weeks and several hundred million dollars to accumulate the full position on a stock of their choice.  Following are some of those stocks that had a spike in volume during the last several weeks.  It takes a couple of weeks for the stock to move sideways and form a new base.  I have these stocks on My Watch List and I have identified the initial resistance point for each of those stocks in parenthesis as a guide.


  1. $AAXN      (64.94)
  2. $ABMD     (415.00)   
  3. $BCOR     (37.75) 
  4. $CRC       (33.96)
  5. $FIVE       (100.97)
  6. $INGN      (182.08)
  7. $SHAK     (62.54)
  8. $SIVB       (306.94) 
  9. $TCMD    (52.23)
  10. $THC       (37.25)
  11. $TTD       (83.37)
  12. $TTGT     (28.31)
  13. $TWLO    (55.20)
  14. $WWE     (60.51)
  15. $ZTO       (21.70)


Mentoring  Program


Our schedule for mentoring new students is filling up fast for the summer months.  There are very limited number of slots available for July and August.  Market usually takes a breather during the summer months and its an ideal time to refine your trading skills.  Secure your spot now before those slots fill up.

Schedule a  FREE  30 minutes of  'Discovery Call'  with us and let us help you profit in the market.  Don't continue to lose money in the market and fail to out perform the market.  Let us show you how to look for Growth Stocks and how best to profit from it.


Happy Trading!



Amin




Sunday, June 10, 2018

Market  Outlook  


I took last week off and headed off to Disney resorts with the family.  We all should take some time away from the markets to reenergize and refocus.  Its amazing how the market looks when you come back with a fresh pair of eyes.  The resorts were at 90% occupancy and the parks were filled with tourists from South America as well as from other states and Florida residents too.  Restaurants were all very busy and most of them were packed with customers.  Gas prices at the pumps had stabilized at $2.70 at most places.  Orlando airport was very busy with flights packed and rental car agencies operating at full capacity.  This leads me conclude that US economy is firing up on all cylinders.  70%  of US economy is dependent upon consumer spending and I witnessed it first hand last week.  Market looks very bullish although we have a total of 10  distribution days  between the  $SPY  and  $NASDAQ.


Our last  "Follow Thru"  was 4 weeks ago on May 10th.  The 3 indexes - $DJI, $SPY and $QQQ - are all trading above the 8 day ema(exponential moving average).  $QQQ is the leading index and it has been trading above the 8 day ema for 5 weeks now.  It hasn't even breached the 21 day ema during any of the  distribution days  we have had in the last 5 weeks.  Here are the performance results of these 3 indexes since the  "Follow Thru"  day on May 10th and the 2 leading sectors that have been trading above the 8 day ema for the last 5 weeks. 


Indexes: 
  1. $DJI     ... +2.33%
  2. $SPY   ... +2.90%
  3. $QQQ  ... +3.57%

Leading Sectors:

  1. $XLY   ... +5.02% (Consumer Discretionary)
  2. $XLK   ... +2.43% (Technology Sector)

This shouldn't surprise anyone infact.  Last week of March we went through an  -8%  correction in the market and I had identified 25 stocks (March 25th blog post) that withstood the correction.  These were the stocks that were supported by the institutions.  They held onto these stocks.  This provided us with the opportunity to establish a position on them during the subsequent  "Follow Thru"  days we had on April 10th as well as May 10th.  Most of these stocks were from the 2 leading sectors mentioned above.




Mentoring  Program


Our schedule for mentoring new students is filling up fast for the summer months.  There are very limited number of slots available for July and August.  Market usually takes a breather during the summer months and its an ideal time to refine your trading skills.  Secure your spot now before those slots fill up.

Schedule a  FREE  30 minutes of  'Discovery Call'  with us and let us help you profit in the market.  Don't continue to lose money in the market and fail to out perform the market.  Let us show you how to look for Growth Stocks and how best to profit from it.


Happy Trading!



Amin


  


        


Monday, May 28, 2018

Don't   "Sell  in  May  and  Go  Away"


Money is made in the market by staying engaged with the markets on a daily basis.  Over the years we have heard so many professional managers tell us:

"Sell  in  May  and  Go  Away"

They are all wrong in making such statements.  Its no wonder that the top 100 fund managers identified by Barrons publication, under performed the $SPY (a barometer of general market performance) by  -4.04%.  in 2017.  You can review my blog of April 29th where I highlighted my views on the hedge funds and professional money managers supported with the data from the Barrons magazine, April 30th Issue.  You have to be data driven and not listen to such non sense.  Let me highlight the data I have analysed over this Memorial Day weekend. 

Data:

1. Historically, looking over the data for the last 50 years, $SPY  had an average performance of  +0.16%.  May of 2018 so far has done  +2.89%.  $QQQ  has done even better ... + 5.17%

2. Historically, looking over the data for the last 50 years, $SPY  had an average cumulative performance of  + 0.44%   for June, July and August.  In 2016 however it was  +3.89%  and  + 2.51%  in 2017.  $QQQ  did a staggering  +5.64%  in 2016 and  +3.48%  in 2017.

Is it any wonder why the average 100 top professional hedge funds identified by Barrons magazine underperformed in 2017?  These professionals could learn from Retail investors and have data drive their investment decisions.  As I often say  "You Snooze, You Lose".  Staying engaged with the markets on a daily basis is the way to profit in the markets.


Market  Outlook


Our last  "Follow Thru"  day of May 10th seems to be holding up pretty well.  For the last 3 weeks, all the 3 major indexes -  $SPY, $QQQ  and  $DJI  have been holding up above the 8 day exponential moving average (ema).  Trading volume has been light and that is what you want to see while the indexes are forming tight flat bases.  $VIX (gauge of fear index) is also hovering below the 8 day simple moving average (sma) around 13  for the last 3 weeks.  Its never a bad idea to buy your portfolio protection now with the  $VIX  being so low.  Since summer months tend to be volatile, it may be prudent to give your stocks some more room to breath if you have gained profits of  +8%  or more.  It's also a good idea to lighten up on those positions that are not performing as well as the  $QQQ   is.


Mentoring  Program


Our schedule for mentoring new students is filling up fast for the summer months.  There are very limited number of slots available.  Market usually takes a breather during the summer months and its an ideal time to refine your trading skills.  Secure your spot now before those slots fill up.

Schedule a  FREE  30 minutes of  'Discovery Call'  with us and let us help you profit in the market.  Don't continue to lose money in the market and fail to out perform the market.  Let us show you how to look for Growth Stocks and how best to profit from it.


Happy Trading!



Amin



   

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Do not take a position unless you are prepared to sustain a TOTAL LOSS. Your loss could include the money you invested as well as commissions and transaction charges.


The Information I provide is for education and informational purposes only. The Information provided is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice. The Information provided is general in nature and is not specific to you or anyone else.


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