Thursday, March 30, 2006

Topping Out Continues

I was delighted, of course, that my prediction the fall would resume today materialized. That validates that the prices were simply retracing to resistance. I'm anticipating further descent tomorrow.

Here's a few favorite shorts, including stop prices. Maybe I've mentioned a couple of these before. The stop price is, by the way, the price above which the position should be closed. As always, click on the image to see a much bigger chart.

ACI (stop: 78.60)

ESRX (stop: 91.64)

FLR (stop: 88.50)

HP (stop: 72.74)

MCK (stop: 53.11)

UBB (stop: 86.64)

UTH (stop: 112.88)


Kapil Khanna said...

Indexes mixed, NASDAQ up, DJIA down. We have an intermittent top on the DJIA as earlier mentioned.
The current action is by no means a trend reversal only a pullback. For a trend reversal to even show up, we are looking at DJIA breaching 10900.

John Wheatcroft said...

I agree with Kapil - I've been watching a tower top form on the Dow for about a week now and it appears that it isn't going to form. Todays action formed a tweezer bottom at the low. Generally that is a prelude to an increase. Be carefull shorting into this market is what it is saying.

Hurricane5 said...

What fall are you talking about?!?! The Nasdaq is at its highest close in...5 freaking years!! I do not short any stocks in the Dow Jones Inustrial so I could care less what that index does. I am losing a ton of money with my shorts in google, nutrisystem, and hansen natural. Most of your short recommendations today are from the NYSE, so should I start shorting stocks traded there and drop the Nasdaq stocks? The Nasdaq has shown no weakness at all lately. I shorted HANS near your recommendation on March 7th but without a stop. I've not made any money on your advice so how do I know any of your picks today will work?

Tim Knight said...

My response to hurricane5:

+ My "advice" is inextricably linked to stops. If you're putting in positions with no stops, I think that's a real mistake

+ If you think the suggestions offered here are no good....stop reading 'em! Honestly. No one is forcing you to read this stuff (why megabulls keep reading this every day is quite beyond me)

+ If you look at a 10 year chart, you will see the "new high" is meaningless. The NASDAQ is still well less than half its historic highs, and there is a huge, huge amount of resistance overhead that I think will take many, many years to overcome.

Kapil Khanna said...

Since you are shorting against the primary uptrend, you should take both profits and losses quickly. If you do not, you may end up like 90% of the traders that do not survive their first year in the markets.
Also rethink your strategy. Tim likes to pick tops and he will keep trying to do so, at least that's what it looks like. There can be huge paybacks with such a system, but you gotta be consistent. In such a scheme, always have stops, and when you pick a top, ride it all the way down.

costas1966 said...

Hurricane5 you are so full of it.
I know you just did not short hans goog and ntri if you did then show us your statement. Enough already it is getting old.

PB said...

buy low, sell high anyone?
Since the markets are high, what shd we be doing? -- the answer is obvious but to the most gullible!

Tim Knight said...

Well, the big question at the moment (with two hours left in the trading week) is whether we're looking at a tweezer bottom on the Dow 30 at 11,120 or whether it's going to bust through yesterday's low and really start to rock. We'll know soon.....

Kapil Khanna said...

How about buy high, sell higher.
Well the current pullback seems to be consistent with all pullbacks in a bull market with low volume on the retracements.
Fundamental stocks still showing strength, with no signs of major selling. Market is currently looking for an intermittent bottom.
You should try fibonnaci now to see where we can find an intermittent bottom and post.

PB said...

Tweezer bottom? How reliable is it? We were in a rare diamond pattern no too long ago.