ParkTwain's Parlor

Granted, this is definitely not my preferred play or setup. I have been watching SBUX since its breakout above about 32/sh. I see that in early March 2006 good support was put in at about 35/sh after that breakout. I missed the dip that happened before the current retracement because it didn't get down quite close enough to 35/sh at that time. This time it has. I might be premature, but I think that there is great pent-up bullish energy for this stock. I see the shares being in an uptrend for the foreseeable future because of the company's impressive growth in store openings along with sales and cross-sales successes in existing stores. Yesterday's intraday turnaround was enough to get me into the market. So this is about 55% a fundamentals play and 45% a technical play. I will add to it as she rises if I am right. I didn't make a big bet at this time.

Of course, JSDA, sold in every SBUX store, has got the killer chart right now. Looking for a good entry there as well.

[dmk112]

Parktwain, SBUX looks bearish to me, why did you take the long?

Doubled up in LMIA this morning. Opened small long position in SBUX.

AEHR is completing a large cup on the weekly chart.

I like AEHR.

Elder Bull is greater than the previous day’s value (good sign) and the Elder “Market Thermometer” is below the 13 EMA, which is a buy signal according to the Elder system.

The fun part:

The exponential/ Regression relative strength model I have been playing with when set to 3 standard deviations below the mean gives a really nice score.
So it should be a "safe" play and with the buy signal might be a very nice one.

After a couple of days of big market drops, there is some concern out there right now; see Runner's new "long or short" poll. The market has been acting very well for the last several weeks, so a new correction is not unexpected as far as that goes. However, we can't yet conclude there is unusual strength in the new downturn. There are also the possibilities that (1) any retracement in oil prices and (2) increase in market sentiment that Fed rate hikes could be paused for a month or two could give the bulls a new charge of electricity.

In a time of possible transition from bull to bear sentiment, I have had some success in the past in finding stocks that have been strengthening yet for whatever reasons remain below the market's publicity radar. Are there stocks out there right now whose strength seems to be divorced from the sources of the market's recent momentum?

There were several decent-looking stocks making new 52-week highs (* = all-time high) even on Friday, which was a second consecutive big down day for the overall market.

ACTS* - China chip maker, rumored supplanting PortalPlayer as iPod supplier
AEHR - flash memory chip package test equip, raised earnings guidance, but low daily volume
AMSF* - rising profits, low daily volume, small/growing workers comp insurer
ARJ* - rising profits, anti-microbial chemical co.
FLA* - profit jump, commercial real estate and railroads (strong sector) in Fla.
JTX* - raised earnings guidance, franchise tax prep service
LNDC - corn play (ethanol momentum?), increasing volume trend
SAFT* - raised earnings guidance, insurance
SMXC - low daily volume but rising profits, trucking co. (strong sector)
TGI* - aircraft parts (hot sector), doubled qtr's profits, pumped by Cramer

Took about 10% profit closing out RTI this morning. Entered LMIA long after yesterday's breakout.

Not much chat around here about the aerospace stocks, including the titanium-wonder stocks. I got some RTI this morning just before it really took off. Check its news. Could get most of a double in this stock in another 4 months. I may buy some LMIA next.

RTI is burning the flesh on the palms of my hands this morning.

This morning, buying RTI, GFF, preparing to pull the trigger on SMDI, PTV, and WTS.

Sixteen printed pages of 52-week highs today, which is much more than Friday. This is incredible.

http://www2.barchart.com/high.asp?=&sort=8&what=ALL&force=high%2easp

My powder is completely dry, so I'm probably back into the market this week after many weeks away. I am working my way through an immense list of candidates, using new highs data only from 5/1/2006 forward.

Watch out for Wednesday and the Fed.

As for "an immense list of candidates," here's the rough draft of candidates (i.e., results of a first pass among all US-domestic-only common stock issues above 5.00/sh with min 50K avg daily volume, on NYSE/AMEX/NASDAQ, with RSI >65, and making a new 52-week high, but almost always excluding banks, mining and gold-related, and REITs) as of yesterday's close, with the findings so far shown in alphabetical order:

//
** = pretty good-looking example, on first notice, of my preferred chart setup

ABK (imminent b/o), AFG, AHS (high ceiling), AIN, ALJ, ALV, ANEN,
AP (>10% over b/o), ARWR (imminent b/o), ASFI, ASGN (high ceiling),
ASX**, ATAC**

BAC** (b/o 4/27), BGC (20% over b/o), BIO (b/o 5/5),
BOKF (imminent b/o, bank), BRK (b/o 5/5), BWA, BWLD

CACC (imminent b/o), CALD (high ceiling), CAM, CAS (>10% over b/o),
CB (~10% over b/o), CFC (b/o 5/5), CL (imminent b/o),
CLHB** (b/o 5/4), CPF (bank, Hawaii), CSH (>10% over b/o),
CTR, CTRN, CVA

DCTH, DIL, DJO (>10% over b/o), DKS, DLB (imminent b/o), DRH,
DST (high ceiling), DTV (imminent b/o)

EAGL** (b/o 5/4)

FCL, FCS (high ceiling), FLOW, FORR (high ceiling),
FSH (>10% over b/o)

GAIA (imminent b/o), GGI, GISX, GFF**,
GFIG (b/o 5/5, watch retest), GMT (imminent b/o), GMTC,
GPRO (b/o 5/4), GYMB (imminent b/o)

HAFC (bank), HCR, HLF, HPY** (b/o 5/5), HRZ**

IART, ICON**, IFIN (immiment b/o), IHR, IIVI (imminent b/o),
ISNS** (5/8 b/o), ITRI, ITW

KAI (b/o 5/4), KNOL (imminent b/o), KSU (high ceiling)
LCUT, LRCX (imminent b/o), LTBG, LTD (imminent b/o)

MANT** (nat'l sec), MAR (<10% over b/o), MEA (WATCH!),
MEAS (imminent b/o), MGA (imminent b/o), MMM (imminent b/o),
MOG.A, MSSR, MTSC (>10% over b/o), MYGN (high ceiling)

NC, NGA**, NKTR (high ceiling), NPO, NRF** (REIT), NSR
OGE**, OIS, OPEN**, OVTI

PBG (P/E: 17), PFG, PKE (high ceiling), PLL, PSPT** (b/o 5/5),
PTSI**, PTV** (b/o 5/5), PVH, PWR (high ceiling)

QSFT (high ceiling)
R (imminent b/o), REM, RENT (low avg vol), RHI, RMKR** (watch!)

SBUX (>10% over b/o), SCS (high ceiling), SCVL, SHFL (high D/E),
SMDI** (high ceiling), SMXC (high ceiling), SPSS**, STKL,
STT, SWFT**, SYM (low avg daily vol)

TAL** (IPO), TGE, TGI** (b/o 5/5, aircraft parts), THE,
TMK (insurance), TMO (imminent b/o), TNB (imminent b/o), TOO,
TSAI (imminent b/o), TUNE (high ceiling), TWGP (low PEG)

UACL, UCTT, UEIC (high ceiling, tech wave and product trends),
UNT, URI

VSAT, VTNC (low avg daily vol?)
WG, WGR, WMI (high ceiling), WTI (10% over b/o)
//

GATORMAN, please tell me what you think of this list so far.

[IIC]

Park...your Tiny url doesn't work...Doug

Nevermind...it works now

[IIC]

Park...your Tiny url doesn't work...Doug

This is a very interesting post (not authored by me) that is found in a thread of posts on the KKD discussion board at Yahoo.com. (Also read backwards in the same thread for other interesting posts from other board participants.) Part of the thread's discussion is about the institutions, mechanics, and business arrangements that assist large institutions willing to lend their shares for shorting by other institutions. This discussion confirms for me why I'm generally not so interested in "turnaround" plays of fallen stocks, even when the technical upside "headroom" depicts a worthwhile risk/return setup. Before concluding that a bounce from a significant and/or long-term downturn in a stock's price indicates the stock market's knowledge of a significant change the company's prospects, it seems that one must still be very well plugged into the company's fundamental operating situation in order to gauge the trustworthiness of the bounce (see also BEL, evidently).

http://tinyurl.com/g2yng

//
Thank you for your questions. They help me focus my thoughts. I track about twenty expensive to borrow stocks GRMN, OSTK, NFI, NYX, MSO, MDTL, SPWR, FFH, PPD, KKD and some others. In a more perfect world trading would favor the investor who knew most about the company fundamentals. I am long NFI and I noticed that its PPS dropped on good news.

I worked (as a technician) for more than twenty years on Wall Street so I figure at least I was close to the action.

I concluded that for some stocks there were other fundamentals that were more important than company fundamentals or sector fundamentals or whatever.

I believe that very few people would pay more than twenty percent per annum to borrow a stock for the purpose of shorting it. I can not really think of a "pure" motive to do this.

The "subscription based" site has a free section. Go to www.dataexplorers.co.uk, click on performanceexplorers, click on SUMMARY STATISTICS, register for free. Click on a month and scroll down to Equities by Fee.
It does not say how much the fee is but other sources have put them at as much as 40%.

Since the fee paid is split at least four ways and we are talking about millions, even billions of dollars there is incentive to do things that are not aboveboard. Like lend securities that do not in fact exist. Most recently THI was lent in a rather huge way. It is an IPO. Last month the most expensive stock to borrow was NYX, it, too is an IPO.

There is some question about where these shares come from.

Regulators (SEC, FRBNY, NASD) are looking into this. Their efforts are on the net at www.agencylending.capco.com. The miscreants cannot be hoist on their own petard until they have it (their petard) in place. It will not be in place until October first.

At that time, I believe, this type of manipulation will cease. Then stocks like this one will be squeezed. And some stocks with bad fundamentals will be squeezed earlier. So, I am leery of shorting these.
//

Dan Zanger, record-setting trader

"My Stocks Are Up 10,000%!"

What a story, from the bubble era.

http://www.investopedia.com/articles/trading/04/082504.asp

More about Dan Zanger's trading approach:

http://technicalanalysis.org.uk/chart-patterns/Blac03.pdf