Wednesday, October 6, 2010

Morning Thoughts

Markets ripped higher Tuesday with increased volume confirming big players buying up shares. Basically every sector was higher with crude and gold enjoying strong sessions thanks to the weaker dollar. The service sector surprise as well as Japan lowering interest rates contributed to the powerful day for equities. Breadth was obviously healthy.

Stocks that are forming specific buy points are: cup with handles include MAR @38.25, NBL @77.73, CE @33.10, TD @75.86. Cup without handle is BEXP @21.25. Double bottom for NOV @46.97. Double bottom with handle CSX @56.90.

PXD broke out yesterday from a cup with handle at 67.87. Lets see how that one continues to develop. CLR thru 49 to confirm its double bottom pattern can be bought. RADS held its 50 day in strong volume.

VALE CAKE building the right side and warrant inclusion on your watchlist.

Weak stocks that didnt perform on a banner day such as this include RBCN VLTR. Weak stocks on a strong tape signal tough times ahead. Lets try and short these as they move back toward their 200 day MA.

Good luck.

The author owns FCX AMT A TIBX EXXI APA WLL. Short AVGO PSA

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