More Cracks are Showing

For the last 4-6 weeks the Nasdaq has been struggling as the Dow has been making new highs. Many of the stock market leaders have been losing their leadership and many falling significantly. The market is being held up by fewer and fewer stocks even as the main indexes still hold over the all important 50 day moving average. As long as the indexes stay above this moving average there is still hope although things are looking worse by the day. In my last report I discussed how most of my readers should still be 80-90% invested. Sad to say because of the leadership stocks giving ground I would suspect that number is now closer to 30-40% as more and more sell stops get triggered.

The chart below courtesy of www.bigcharts.com shows the Nasdaq as it tops out and you can see we have two distribution days as we see much higher volume on those down days. Now is not the time to be a hero, wait for the market to stabilize even if it is still above its moving averages.

Remember this blog site is not a newsletter that promotes stock tips or penny stocks. Rather the idea is to teach stock selection with low risk advice. You can also catch me on Twitter for more regular updates and YouTube for some educational videos. See links at upper left.

Grudgingly Moving Up TER, CPHD, FTNT, AGU

The stock market is 2 weeks into 2011 and is very slowly making headway to the upside. This is not a decisive move however we must respect the trend. The Dow is still very clearly above the 50 day moving average which itself is trending up. Until we see a break on higher volume through that moving average to the downside then we must continue investing. See the chart below courtesy of http://www.bigcharts.com/.

Followers of my blog should still be approximately 80-90% invested in the market even though some of the leaders have labored and even failed. Enough stocks are still holding up to support the indexes. For this reason we should use some of our profits and add to positions or even take on new positions.

Here are a few more stocks performing well and looking ready to move higher if the stock market holds up. Make sure as always that earnings are not imminent for any new purchases. Remember this blog site is not a newsletter that promotes stock tips or penny stocks. Rather the idea is to teach stock selection with low risk advice. You can also catch me on Twitter for more regular updates and YouTube for some educational videos. See links at upper left.

TER – $14.69

CPHD – $24.54

FTNT - $37.37

AGU - $93.48

Wait and See

A good jobs report yesterday failed to fire up the market. We still need to see significant volume to the upside or downside to decide on a strategy going forward. For the moment readers should continue to monitor their holdings with a view to tightening up the sell stops. Now is not a time to initiate new positions in companies until we see which way the conviction lies.

A number of my readers have been asking for more regular updates. To comment on the market on a daily basis is for day traders only, however I can understand the need for more information. For this reason I have started giving short concise comments on a more regular basis at http://twitter.com/rmhs my link is also on the left. Additionally I will continue to comment here as and when I consider necessary. I have also started adding occasional videos in youtube.com explaining some of the strategies and reviewing some of the companies highlighted here in the past.