Tuesday, August 18, 2009

How Much Wal Mart Stock are These Guys Holding?

So.... I'm catching up on Bloomberg Surveillance and listening to two different people regarding the Retail numbers that just came out on August 13. And I hear two different analysts discuss how great Wal Mart is these days, that they have better selection, new brands, and are poised for growth in the Mid-West and Western States. The idea is that they'll get you in with good grocery prices, and then try to make profits on the rest of the inventory.

I don't know what Wal Mart these guys are visiting, but my local non-Super Wal Mart is still the same old overgrown Dollar General I've always known. Sure, they've added some coolers to sell chilled beer, but it's no grocery store. More and more over the past few years I have walked the isles observing that their stuff seems more and more cheaper, while the prices keep creeping up. I think if Sam Walton knew what his kids allowed his store to become, he'd be turning over in his grave. On the other hand, Wal Mart has evolved to seek organic growth and had to change its business model. Nevertheless, I don't see Wal Mart trying too hard to be a 'better' store, just a store with more volume.

Mrs. Edgy and I use to enjoy going to the Wal-to-Wal Mart when we first got hitched almost a decade ago. We see some of the same items we used to buy in smaller quantities, thinner materials, and higher costs. One easy example is Christmas tinsel rope that we string around the tree. We're glad we manage to find the 15-footer for less than the 6-footers sell for today. That's good ol' inflation, and it has snuck up on us.

I'm finding less reasons to head to Wal Mart all the time, they are no longer the low price leader!

Meanwhile, there's another interview with Robert Prechter, someone whose books I've been wanting to read for a while now. He's putting his money into "cash equivalents" (like T-bond and T-bills), and doesn't expect stocks or commodities to be a real value for a few more years to come. I like his theory, but I still think that we'll see one more mini-bubble before the value buying time comes. I don't think it will be the "square root" shaped recovery that Binder and Prechter seem to be planning.

Anyway, that's for long-term money. I'm still trying to work on practicing daily and weekly swing trading. Still busy with the deadlines at work, and now the Honey-Do list is getting enforced. Fortunately, I've been in cash since Thursday and missed out on all the fun Friday and Monday. S&P took a breather today, but I see the Daily trend is still down. When I get time to look, I'll be looking for small priced stocks ($1-$5) with some volume that are following their own patterns.

Monday, August 10, 2009

The Struggle Within

100% Cash. Made small gains today on ZIXI offset by losses in CY. Dropped CY shortly before it made a wonderful comeback into gains for the day. Oh well, I don't like the way the tape is moving right now. I'm seeing ascending triangles and upward channels getting broken on the bottom (failing). I'm starting to feel a bearish sentiment, or maybe just consolidation.

But after looking at the daily charts, the last two day's candles look like they might be a Bullish Harami on low volume. I think tomorrow is going to be another good day for the SPX.

Wednesday, August 05, 2009

Wednesday Trade Review

Despite my real job deadlines looming near, my 'customer' decided to move up my due date to today. But then stated an understanding if everything is not quite in tonight. I had to break the excitement with a few peeks at the boring, ho-hum, droning stock market charts to keep my sanity.

I thought I had JAZZ with a wide enough margin to avoid the stop sweep, but I got knocked out early in the day. The stock is still down, so maybe I'm not ready for it yet.

Meanwhile, I added CY to the holdings, keeping AMD and ZIXI company.

Overall, the SPX was down -0.29%, and I was up +0.50% for the day. Not bad for also working a 12-hour day to get drawings in on time. I think I spent a total of 20 minutes checking on trades today, using the time as a break between the stress of meeting deadlines.

I noticed that the real traders that I follow raked it in with AIG, CIT, and C to name a few. I'm hearing about double-digit gains, so it pays to keep your eyes open.

Monday, August 03, 2009

President Obama: Mission Accomplished

Over the weekend I heard bits of Obama's announcement that 2nd Quarter performance of US GDP was, quote, "...better than expected." I immediately thought of all the government intervention that seemed to pull the S&P unrealistically out of the hole it was in back in March. During the whole rally I was in disbelief, and was even financially rebuked for my beliefs until I set myself back on the strait and narrow. Like they say, a rally climbs a wall of worry, and now I know what they mean.

Back to the Big-O, when I heard him say the above quote I pictured him in my head saying, "Mission Accomplished." The government intervention does well to explain the 'unbelievable' behavior of the rally of the Markets over the past few months. And I view this regardless of my personal political opinions; because the $750B Stimulus program was started by President Bush right before he left, and then completed by the next president. The politicians are just trying to recover tax revenues by encouraging the morale of the country, touting success to get consumer spending back up, GDP in growth, and strength back to the Dollar.

However, I'm in the camp that fears that all this spending is going to come back to haunt us soon. All this stimulus is acting like a defibrillator, trying to jump start consumer spending back into full swing. But I think that American business in general is still carrying too much fat to keep pace. I fear that there needs to be another correction, but I don't know if it will be within one year or 5 years. But I do believe it will happen within that time range.

As for the S&P and this great rally we've been having since March, we have finally arrived to the major line of resistance, going back to the peak in Oct. 2007. In a sense, this recent rally has been a correction of the oversold condition that started in Oct. 2008. At about 2:25 pm today, it appears that this resistance was tested and respected. The next few days might be rather interesting.

I'm thinking that the S&P resistance will break, but not beyond the Fibonacci retracement around 1053. That is my perceived line of resistance, and I'll be truly optimistic (bullish) if this line gets shattered.

Here's one of my current holdings, ZIXI. I bought-in around 1.65, right before the recent spike-up. We're pushing resistance right now, and I'm hoping for a breakout. My stops are not far below the support line of this rising triangle, but far enough to avoid most stop-sweeps.

I'm also hanging on to KLIC. This one is starting to wear old, but has behaved itself otherwise. My patience is beginning to get tested.

I'm looking at JAZZ, thanks to a tip from Trader Stewie. This one shows a little more promise than my other two holdings. Thanks, Stewie!

One more potential rising triangle is CHDX. I don't like how it penetrated support today, but I'll be watching it tomorrow morning for signs of life. That last line looks like a bull flag.

I noticed that I've also missed the boat on a few other stocks I put on my watch list last week, like OMX and CCO. It may not be too late to get a piece of those, but I haven't figured how to tell if they still have life in their runups or not. Meanwhile, I'll be continuing my studies under Constance Brown's All About Technical Analysis.