I can be Huge too

[antioch6]

I'm thinking about when to exit EL, and I couldn't think of anything else happening in one day. The market is near support, and you can't get more than a -2.5% down day without some extra news. I would of expected EL to be down much more already, so now would of been the time to get out while the price is dropping.

[antioch6]

Today the market is not as bad as it looks; if yesterday was not a good gain day, today was not a good loss day. The S&p and Nasdaq look worse because they have high p/e ratios, but overall between yesterday and today there is nothing gained or lost. The selling is not enough to trigger momentum as you can tell from EL which is still up +1.53% for today. The momentum that started in June is over, and now we are heading back to May levels. As selling gains momentum, only the news and value will guide us.

[antioch6]

EL was upgraded from sell to neutral by an analyst, so I'm feeling kind of depressed because everything is down except EL. I'm watching it stay +2.5% to +3% higher and now I know I'm in for a longer wait; sort of what Jiesen felt when he saw PLPC going lower after raising his hopes. But like Jiesen I know the market will go on, continue on, and I still think EL is going lower so I'm starting over and monitoring the momentum.

[antioch6]

I looked at the intra-day chart of EL and I noticed there is very light trading; someone is buying at market and sending the price higher . I think someone is even trying to squeeze me; the volume is very light and I expect the price to reverse lower. I feel comfortable about holding this sell and only a wild short squeeze will push me out.

[antioch6]

So I just woke up and I found EL is up +1.7%. I said the market might be down -1% but I expected EL to be down -3%. The opposite is happeneing, probably because of short covering. I'll give it +2.5% more to prove me wrong, but I already feel wrong on this one.

[antioch6]

I think today there was short covering and some momentum buying - people buying because the market is at support or going sideways. I'm selling EL and down -0.46%, but that is acceptable; EL was up +1.21% while the market was up a minimum of +1.00% on the lower end, and a minimum of +1.60% on the higher end. I think this is expected in a sideways market as the weaker stocks gain on oversold lines of thinking and the stronger stocks go sideways; there was one stock that's started to go higher but it is a truck parts company so it's cyclical and doesn't have much to stand out - PCAR. From what I've seen and heard the top stocks are falling a few at a time and the overall trend is still negative for most companies. The S&p 500 and Nasdaq 100 are still in buying range as they hold their gains from August lows; any move lower could end this buying range and create a selling range. If you believe in buying strength and selling weakness, now is the time to buy. If you believe in fundamental strategies, and missing out on some gains while increasing your percentages, now is the time to wait. Finally, if you believe stocks track the overall economy, you're trades will depend if you think there will be a recession in 6 months or if growth will continue. i have to give the chances to fears of recession coming back, because they were there last year, and now they are gone. The only risk here is if traders temporarily send prices higher on emotion and momentum. My strategy is selling now with a 1-3% stop loss, and re-entering again after gains are made and momentum is lost.

[antioch6]

I sold EL because there were no good stocks to buy, and it looked like the most consistent, weakest company to sell. U.S. stocks are higher today, around +1%, but it's more a general 1% higher, after several weeks of going lower. It's not enough for momentum, so overall I think the next move will be -1% lower.

[antioch6]

As I look into possible stocks to sell, I see more and more stocks precisely at their lows, just like BlueWolf said, on the precipice. The only downsides here are the possibility risky buyers will enter at support, and the outlook that in a year or a year and a half, everything might be fine again as governments stimulate the economy again and start the cycle over. Before this happens, we need to see buying, and we need to see a stimulus. In the meantime, the current momentum is favoring the up side, but there might not be any reason to go significantly higher - the government won't stimulate until the people are suffering. The interesting point to watch might be what the risky buyers might react when they hear news of a bad recession but see prices going higher. Will they get greedy enough to buy as we see our first recession and support prices in the S&p 500 and Nasdaq 100 that are already high, trading around 20 times earnings.

It's easy to buy into the story long term; the S&p will always go up, the government will always bail out companies and support higher stock prices. That's been true, and we are currently favored to higher prices in the S&p, Nasdaq, and Dow. My profit greed is telling me there is large potential on the downside. Most stocks are going lower; any index that isn't concentrated, more representative of the whole U.S. market is going lower currently. This tells me people are buying the major indexes, supporting brand names that represent the U.S. market most in Name. I mean companies that most people think of when they think of the U.S. market all around the world.

The next step is to consider these global traders are buying the U.S. market because it has brand appeal, and they don't care too much about the price. The only thing left that can happen are risky traders, or hot money, can enter and send prices even higher than they are now. The question is - will these traders be able to hold when the recession arrives and prices are decreasing? Someone is sure to sell, and others are sure to start buying at the first signs that the government will stimulate.

The problem is finding someone to buy from and finding someone to sell to. Everyone agrees prices are high, so probably they will fall back down to where they are not high, or to where they are low. in theory, the market should trade at a fair price, where it's not too high and not too low. The explanation for it's current high price, is there are many traders willing to wait years for returns, and willing to accept smaller returns, just to be in; just to participate. There is a large supply of buyers, and so far there is a small supply of sellers; the momentum is currently higher according to my market timing services, but to me I see a sideways market that could go decisively 1% strongly in either direction before I could comfortably gauge if there is something worth getting excited about, or if there is something trash enough to sell for money.

Apart from anything of the like, we should reach for a constant, steady income. Government has concluded that an income of $72,000 a year is enough to sustain a family of 3 happy. My personal studies result in an $81,000 a year number. So this should be our effort for everything money-related including the stock market. I would use interest rates as the guide for our percentage return-line of thinking. Currently, I would expect 5% from a safe bond, or maybe even 4% if it's 10,20,30 years expiration. The amount of work you have to do is tied to the amount of money you have now. If you have $2.025 million, you can buy a U.S. bond and live happily with a family of 3 for thirty years. You might want to work so you have money incase interest rates decrease. If you only have $100,000 you'll have to work more because you can only make $4,000 a year from investing. The worst case scenario is living alone and in the poverty line at under $14,580 per year. This should place you under support from the government, and in need of $12,480 per year to live happily. This is $238.85 a week. If you work you'll need to make about $57.32 a day. For me this is hard work, but I can try to manage $238.85 a week with my resources. It's useful to have your dollar needs written down so you know what level of risk to take. I hope everyone makes it happily to 2025!

[antioch6]

I'm watching NFLX as a possible sell; it's gone up 200% off the lows and is losing momentum. The p/e is 45, and the earnings are flat. It might take a while before it goes down; my mom told me we're already in a recession, and she can see it start to get bad definitely by next March. What does a bad recession look like? Maybe people out of money, less spending around overall, less purchases of expensive items like houses and cars, companies spending less on expanding.

The next topic that comes to my mind is what companies will suffer the most from this spending. I'm sure I'll find one, but it might not be time to sell yet. If the recession will get bad in March or sooner, that gives us 3-4 months to prepare and sell our stocks or sell short. In the meantime, we can monitor the market momentum day by day, figure out who will be the last to buy, and pick which areas will suffer most.

[antioch6]

I started my selling at 18.27, I continued at 19.17, and I finished buying at 18.68. So I lost +2.25% on the first half and gained -2.55% on the second half. It feels good taking a small win on a trade I was wrong on mostly. If i would of taken that large gain on the trade in the morning, I would of had to speed up, and traded more on emotion and luck; now it makes more sense that the company hasn't changed much in value, and I am getting out around even.

I think the momentum is sideways and I still think Path is high, but risky buyers are buying slowly, and the market is not falling. They could send the market higher, but on the other side, investors who have companies bought from 2008-2015 and before, might sell to these risky buyers as we enter the first recession in 15 years. I'll be trading one day at a time, enjoying the strongest and weakest companies, and having fun.

[antioch6]

I was watching PATH all day again, and today I noticed it held up better than I expected. It was down 6% in the morning and I was placing my order for closing, but I was too slow and it's been -2% to -3% for the day. I'm looking for one final sell before the end of the day, and I'm placing my limit buy order now.

[antioch6]

I've been watching PATH all day, and now I decided to sell more as the momentum is over. This was up almost 5% today, but now it's back to 3.65% where I'll take my chances and add a stop 1-3% above the highs.

[Louetta]

...snip...

If PATH is dangerous to buy, and there is a small chance of large gains, then it must be safe to sell, with a average possibility of large losses.

I chose for similar reasons to go with the long-term calls. My loss is limited to what I invested in buying the call. If the stock falls in the near-term the option does not fair too badly (tho it does go down) because there is so much time left. If the stock does well before 1/2025 there is the possibility of a decent gain in the option and I won't miss out because I will always be in the stock via the option. Monday I can roll it out to 1/2026 if the premium is not too much (and it might very well be).

[antioch6]

I was thinking the sells were very low and near support, and the buys are all high and near resistance. The likely scenario for me is down across all sells and buys, because there are not many buyers. Expensive stocks with momentum should drop back down as the price returns to where it4 was before the momentum buying started. With this in mind, I looked for the highest stocks with the most one to three day momentum, thinking it will reverse in the next 1-3 days. I just exited PATH, so if it's worth selling it must be worth selling for a profit. I was scared of the high p/e together with the weak momentum after a 10% up day. PATH should of been up 5% today. Instead it was flat, and later I saw small investors buy the price up 1% for the same reasons I bought it yesterday. They are following the momentum in earnings and price, but they don't know about the value yet. So if something is high priced, less people will buy it, and the momentum will end. I think this is happening in PATH now, and i'm selling while expecting the 10% gain yesterday to reverse as no new buyers arrive.

If PATH is dangerous to buy, and there is a small chance of large gains, then it must be safe to sell, with a average possibility of large losses.

[antioch6]

I just sold PATH because the valuation was too high. I watched their earnings webcast and even with 20% growth rate, they're only expected to make $135 million dollars this year. That gives them a p/e of 61. The story is good, the growth is good, but the p/e is too high.

This makes me sad because i wanted to hold something. The market is really tough; there are no names on my screen. There are some sell names, and my favorite is MNRO. TREE is also falling. When this momentum from the market fades, I'll plan to sell these.