Stenzrob's specials

[mrmarket]

Re: roll me over

Does anybody else get the feeling this market is going to roll over and die? (for a couple weeks or a month at least)

Decent rebound today for the techs, but heaviest days lately have been on the downside

I agree. I believe the next month or so could be pretty treacherous.
The good news is that stocks that remain strong, during this period, will be the ones to buy. The bad news, how does one identify them?

Tim

earnings earnings earnings

[Anonymous]

I agree with Tim et al.

That is why I am 100% cash---I think this is treacherous indeed. Food for thought---if Ernie is so hot on earnings, earnings, earnings (actually I am too) why does he stubbornly keep stocks that disappoint on earnings after he picks a stock? Could it be for ego reasons (the "streak")? Hmmm... I personally prefer not to be so rigid on stock management as Ernesto, buying on selling based on fundamentals, which are not rigid, but change as time goes by IMHO.

Stenzrob-I personally would suggest starting your own website. I think you could get a good following. I would bet that over the last quarter for instance that just ended your portfolio has trounced Mr. Market's---in fact, and you do not have to say, I would bet you have very few if any of Mr. Market's picks in your portfolio, especially not ones like NARA and WSB. Think about it---I may disagree with some of your posts at times, but you have a flair for this kind of thing.

[stenzrob]

First, I respectfully disagree with Ernie about "earnings, earnings, earnings". A company can boost earnings while revenues stagnate by cutting costs, R&D costs for tech companies for example, but this does not bode well for the longer term. Revenue growth is key, IMO.

Second, about how to identify stocks that can remain strong in the face of a treacherous market, in addition to the revenue growth, one must pay attention to price & volume. Stocks that can do well in a down market will be identified by the fact that people (and institutions) are buying it. Duh. Higher volume on up days than on down days, advances past resistance levels on heavy volume followed by consolidation at that level on low volume while moving averages catch up. Trendlines remaining intact. These are the true "momentum" stocks.

Third, about the next month or so being treacherous. Maybe yes, maybe no. The nasdaq is flirting with it's 50 day average, and it could go either way. On the one hand, stocks have done well for the last quarter, so people getting their mutual fund statements might be tempted to put more money in, and the funds are required to maintain positions so they will be buying. On the other hand, currency ratios may cause foreign investors to pull out of the US market causing a drop in the US markets. Margin levels are currently at levels even higher than in early 2000, so the beginning of a drop could trigger an avalanche that would take virtually everything with it. I will stay nearly fully invested but watch very carefully for signs of impending doom.

Finally, about starting my own website. I don't think so ... such things only attract too many kooks and critics, obviously.

[thebign1]

2 Questions

Hi Stenzrob, I think your picks are great and I was wondering if you are still using Accel Rev + Price screen?

I have an online account with Sharebuilder and even though you can trade 4000 different stocks with them their are a lot of good ones that I can't buy. I've been looking into First Trade to open a second account.
Do you have any thoughts on this?

Thanks, Norm

[stenzrob]

Re: 2 Questions

Hi Stenzrob, I think your picks are great and I was wondering if you are still using Accel Rev + Price screen?

I have an online account with Sharebuilder and even though you can trade 4000 different stocks with them their are a lot of good ones that I can't buy. I've been looking into First Trade to open a second account.
Do you have any thoughts on this?

Thanks, Norm

Thanks, Norm. I have accounts at Schwab for an IRA and at ETrade. I have no opinion on those other brokers.

I am indeed still using Accel Rev + Price screen. I also look at some others, but that one seems to work quite well, at least when the overall market is doing well.

By the way, a friend who subscribes to it told me that GIGM was just highlighted by the Investment House newsletter, they see a cup & handle formation with a breakout point at 2.98. This on top of a recent recommendation by Thom Calandra's newsletter. Quite often, one or more of my picks will be highlighted by the IH newsletter a few weeks after I pick them and I'm already up 25% or more. (I'm currently up over 50% on GIGM) Some of my picks also show up some time later in $$$MM$$$'s dumps, like FARO has. I believe this is because my screen tend to pick up on accumulation even before the really juicy momentum gets going, probably because of my screens terms for increasing volume.

regards ... stenz

[thebign1]

Hello Stenz, I also have a Schwab account for my Roth IRA but I don't do a lot of trading with it. I try to keep my long positions there. (FRED, NRI, NFB, etc....) But I like GIGM also, (#1 on your list) I just can't buy it with
Sharebuilder. Another thought would be to dump some of my EOP in my Schwab main account & grab a few thousand shares.

Regard, Norm

[stenzrob]

Dependence on nasdaq

Most of my holdings will be greatly affected by what the nasdaq does. They typically have betas much greater than 1.0. If the next few months are "treacherous", my portfolio could suffer a bit - but then, I have stops for that, not actually on the books at the broker, but in my tracking spreadsheet. (I put the stop prices in one cell, then use conditional formatting to have the current price turn color if it goes below the stop price.) From there, it's not automatic (but is very likely) that I would sell - it depends on volume.

The lower stops are based on either moving averages or drawing lines on a chart of the uptrends that give these stocks their high relative strength numbers. Unlike $$$MM$$$, who is indeed HUGE, I will sell the stock if it no longer fits the criteria - my criteria looks for revenue growth, I will sell if the growth stops or slows significantly; my criteria looks for momentum or accumulation, I will sell if the momentum turns.

As I posted earlier, the nasdaq could still go either way, and it is a losers game to try to predict it, IMO. If it gets above ~1850 with some volume and follow through, I would expect most of my stocks to take off like scalded apes, with some perhaps surging 50 to 100% in a matter of weeks. I would certainly not want to be 100% cash if that happens. On the other hand, if the nasdaq turns and heads back below it's 50 day average, again with some volume, my kind of stocks (barring any significant news) will head south in a hurry and those stops will cause me to sell; some newer positions at a loss, others at less profit than I'm sitting on now.

I have enjoyed 150% gain in my portfolio value in the last six months, not by sticking with losers that have lost their momentum and waiting a year and a half to get a 15% return out of it, or by sitting on cash, but by usually riding the winners however far they want to run, and usually cutting losses before they get large. Nobody can predict which way the market is going to go on any given day or week, and most stocks are affected by the overall market mood. Valuations and earnings can give you a warm, fuzzy feeling about a stock, but stock prices are not driven by these things alone, and nobody can predict how the market will react to anything. I have seen companies post great results, only to get sold off. I have seen stocks take off on no news and have no reaction to great or bad news. I like a warm, fuzzy feeling; that's why my screen produces candidates with strong revenue growth and reasonable valuation using one metric. But ultimately, it is buying in volume that drives a price up, and we, the retail outsiders, will never know exactly what may be behind it. We can only recognize and react to it.

I'm currently long CRIO, GIGM, HBIO, QVDX, and MTEX in my trading account and NTST, TRCI and HBIO in my IRA. I believe that any one of these could surge 50 to 100% in just a few weeks, or increase at about 5 to 10% a week for several months. HBIO is looking particularly ripe about now.

[stenzrob]

Re: I agree with Tim et al.

Posted on 10/1/03 -

That is why I am 100% cash---

Since 10/1,
MTEX up 10% from $5.90 to $6.50
CRIO up 3% from $2.95 to $3.05
HBIO up 8% from $7.50 to $8.10

QVDX bouncing between $3.75 and $4.00
GIGM re-basing at $2.50

For the last six months, my portfolio has averaged about 4% return per week. Last week was no different. 100% cash? I don't think so.

!!!Stenz_ALERT!!!
- Watch HBIO for a possible breakout. The gap up day a few weeks ago closed at $8.12. A close above $8.12 on some decent volume in the next few days would be very bullish.

[stenzrob]

Re: Dependence on nasdaq

... NTST, TRCI and HBIO in my IRA...

TRCI >15% volume breakout today! Yeeha.
NTST +6.5% today, continuing after bounce off moving average
HBIO +5.1% today, moving toward breakout

[minni17]

Stenzrob has earned meat and cheeses

Yo man you are HUUUUUUUUGE.

Bought some trci at 7.18 on Sept 3rd. Just saw it cross at 9.15 on triple average volume. That's 28% in 4 weeks and chart still looks awesome!

What kind of cheese goes with filet mignon?

Keep em coming

Minni

[stenzrob]

Re: Stenzrob has earned meat and cheeses

Yo man you are HUUUUUUUUGE.

Bought some trci at 7.18 on Sept 3rd. Just saw it cross at 9.15 on triple average volume. That's 28% in 4 weeks and chart still looks awesome!

What kind of cheese goes with filet mignon?

Keep em coming

Minni

Glad you liked it, minni.
I guess I've been living in the Philly area for too long now, I slice the filet mignon into thin slices, grill it with Velveeta and onions, slap it on a long roll and smother with ketchup.
I was born in North Tonawanda, but got over the roast beef on a Kaiser habit eventually.
28% in 4 weeks - what's that on an annualized basis, I wonder?

[ChrisZXWJ]

TRCI

hey stenzrob...are you still holding on to TRCI after today's gain? I'm trying to talk myself into selling, but I can't quite do it. I'm up over 30% in the last few weeks myself. What do you think?

By the way, I'm living in North Tonawanda right now...I'm a grad student at UB.

Chris

[minni17]

WNY chapter...STENZROB fan club

WNY chapter...STENZROB fan club

I Live in Kenmore ( just south of North Tonawanda), graduated UB a long time ago, and still eat beef on weck.

Good to hear from ya guys in the area

Minni

[stenzrob]

Re: TRCI

hey stenzrob...are you still holding on to TRCI after today's gain? I'm trying to talk myself into selling, but I can't quite do it. I'm up over 30% in the last few weeks myself. What do you think?

By the way, I'm living in North Tonawanda right now...I'm a grad student at UB.

Chris

As I said in an earlier post, Chris, I'll ride as far as it wants to go, until something changes. I don't see why a "momentum" trader would sell when a stock breaks out on heavy volume. If I didn't already own it and had just found it because of the breakout, I might wait for a pullback to buy. But since I already have it, I'll just keep it until something changes - bad news or uptrend violated. Move up strongly, settle a bit on lower volume, repeat. I've seen stocks do this for months and months.

About NT - I lived on Jackson Ave near Payne Ave until age 5, then moved to the other end, on Christiana between Payne Ave and Christiana Park until age 11, then was dragged off to the Albany area. I never drove in NT, so I don't know my way around there very well. I really only knew my way from my house to the Elementary School and the comic book shop.

Good luck with your grad studies ... now stop hanging around here and do your homework, young man!

[ChrisZXWJ]

well, conveniently, I'm a MBA student with a concentration in finance...so I guess this could count as homework. I'm working with a few professors right now to try to "integrate" this whole process into an Excel spreadsheet, sort of like the one that was posted in the Yahoo group.

I'm not 100% confident in this whole momentum trading thing just yet. I do like how your model incorporates some fundamental valuation, which makes me more comfortable following a momentum trading strategy. So, I'm having a harder time determining when to sell using this method rather than just selling when I feel a stock is fully valued.

I'm not too familiar driving around the area yet myself. I just moved here at the start of the year after graduating from SUNY Albany. Small world, huh?