Get 100 Free Trades. Trade Up to OptionsHouse.com

Overbought Market, how to navigate – July 2010

July 26th, 2010
Share

Market has been rallying for past several sessions in a row now. Whatever the reason might be, this is probably the toughest time to navigate the market. Again in such situations, cash might be the position to take for conservative investors.

Read on active trader

If you reached here, that means you do want to figure out how to navigate in the market like this. There are two common behavior that one can see in the market, well one of the two outcomes I am going to outline:

  1. A sharp spike down
  2. A period of consolidation

If you are a bullish on the market right now given all the positivity that is flowing through the news, you want to have a pullback on low volume. That will indicate a bullish move. That got to happen because people will start taking profits. However if there is panic selling, you know to get the heck out of the market and wait on the sidelines again.

If you are bearish investor right now, you are waiting for a major downward movement. You might be sitting on or planning to buy reverse ETFs such as SDS or might be buying put options!

Honestly speaking, I would NOT take the bear attitude just yet. Because right now market is extremely bullish, however the pullback is imminent. So you might want to just wait and see the magnitude of profit taking or selling. If selling is moderate, I would imagine that as a buying opportunity.

Make sure to book your profits

In a economy like this, you never know what is going to happen. No one can predicts a news item coming out of Europe that will take the entire market down again. So its critical to confirm your profits while they last and be ready to hit the market when you see the opportunities.

Save your money from getting spent on commission

Trade with OptionsHouse to get:

1. 100 Free trades

2. 2.95$ flat rate pricing after first 100 trades

3. 90 Days of Free Trading Coaching from market expert

For details, please click on Sweet Offer from OptionsHouse

Tags: ,
Posted in Is it time to invest?, Learn how to invest | No Comments »

Is this a good time to enter the stock market – July 2010

July 25th, 2010
Share

Among all the positives that are making rounds in the stock market currently, one thing thats bothering the market guru is the trading volume. There doesn’t seem to be a huge interest in trading currently. Volume has died down once again since the market took a downward swing in May.

S&P closed above its significant 1100 mark. However due to low volume, I am still not ready to dive into the market. What should someone do in such a market condition? Let me list a few things that one should do in such market conditions:

  1. Keep plenty of cash: Cash helps you to take advantage of downturn. Downturn is not always bad. If you see strong catalyst in the horizon while the market is tanking. That might be the time to throw some money in and it will return some nice $$
  2. If you expect a bear market, shorting is a way for you to still make money if the market is tanking. Another way to invest in bear market is to take a look at reverse ETFs such as $SDS
  3. Keep money in mutual funds and CD while you are not ready. So that will make some money while you are still pondering over the opportunities

Anyways seems like $aapl, $crus, $goog, $msft, $jazz, $arna are seto move up in next week or so. Be sure to have tight stops in place to prevent any unexpected reversal of the rally.

Tags:
Posted in Is it time to invest?, Learn how to invest | No Comments »

Is recession over – Future of US Economy – July 2010?

July 23rd, 2010
Share

This week has been extra good for the market. Several big positives came into limelight:

  1. $BP’s oil spill is finally seems to be getting close to fixed
  2. $Apple recorded record earnings due to more than expected strong sales of iPad and early sales numbers for iPhone 4
  3. $F, $MSFT all recorded awesome earnings

European bank’s stress test result come out today. Different investors have different views about these tests. Some think they are pointless and most of the banks will pass the test. Others tend to disagree and are actually contemplating the future of economy based on the stress test results.

Germany and UK both reported much better numbers than everyone had in mind. Check out this latest article which details out the earnings for major companies in the past week or so:

Stocks May extend rally this week

So in the wake of all this positive news, one has to wonder whether we are out of the cursed spell that brought all of us down since April. I sure hope so. Jobless claims continue to rise despite the awesome earnings reported by fortune 100 companies. However it is very important to understand that jobs are always created AFTER the market has turned around a good bit. Companies do not want to hire new people if there is too much uncertainity regarding where the economy is headed. So while it definitely helps to see green on my portfolio and it is also rewarding to know that people who are looking for jobs are able to find jobs to support their families and send their kids to school.

People are saying if somehow DOW can get back to 11,000 range, we can sit back and enjoy the ride all the way out to the promised land. Lets sit tight for trading session to see where we are headed

Tags: , ,
Posted in Economy, Is it time to invest? | No Comments »

$aapl where is Apple Stock Headed – July 2010 After record Earnings

July 21st, 2010
Share

So Apple reported their earnings on Tuesday night on 7/20. Highest ever earnings reported by Apple. Apple rose almost 20$ within a matter of 1 day and then during the day entire market decided to take a U turn. Apple could not contain its gain during After hours trading. Apple however did move up from its last close on Tuesday right before earnings. So is that good sign or a bad sign? No one really knows. Technical traders will out claiming one thing, fundamentalists will tell you another thing, Apple lovers will describe a whole another story.

Best way to trade any stock is usually based on your guts. You have to gather info from various sources and then call the shots yourself.

Lets look at what major factors Apple has currently:

Positives about Apple during Q3

  1. Record sales for iPad & iPhone
  2. Upbeat market sentiment about $aapl after earnings
  3. Superior products
  4. Steve Jobs did an awesome job by retaining Apple lovers by admitting to slight problems with very limited number of iPhone 4.
  5. Continued research into product improvement
  6. New product line up – This is unannounced as of right now. This will unfold in near future on its own
  7. Potential Introduction of iPhone with other careers like Verizon & T-Mobile
  8. Launch of Apple products in other countries

and the list goes on and on and ……

Negatives about Apple during Q3

  1. Consumer Reports claim about Antenna problem with iPhone 4: Well as Apple has reported, problem is limited to very few people. Less than 1 percent of total iPhone 4 owners. So this probably not a such a huge deal
  2. Apple has become too big. Now its time for others to try to bring Apple down. There will be several companies conspiring. If Apple is truly Amazing, it will come out even stronger. If $aapl breaks 273-275 range, it appears it might soar to 330$ very soon. It will be fun ride thats for sure.
  3. Overall economic conditions: Well no one can do anything about that. But can you really stop a company expanding 78% year over year from reaching new highs every day, every month?

Tags: ,
Posted in Economy, Smart Phone Industry, Stock pick, Technology | No Comments »

« Older Entries