Tuesday, January 27, 2009

Whither Goest Thou Bear Market Rally ? Part Deux


lets skip back to the 10 min chart of the $WLSH posted on Sat Jan 24, and look carefully at the scale corresponding to the RED TOP LINE of the TRIANGLE. That line Terminated on the Right Hand side of the Chart at 8400. Without having to look I can tell you that the $WLSH is now in the 8500's, again a depiction of a DECISIVE BREAKOUT.
Yes the 30 stocks in the DOW are tired, but the 5000 stocks in the WILSHIRE are off and running. See for yourself. Its there - > at lunch time it was 8530. The bottom line here is that the BOTTOM LINE belongs to the Broad Market, not the DOW, no matter how the TALKING HEADS phrase it. Pick your shots, I posted the candidates earlier. DYODD and you might have a decent shot. Also dont panic about selling. Set TRAILING STOP SELL ORDERS, with wide margins. For the Initial phase of an acquisition I use 15% Trail per-centages, as I have been shaken free of lesser margins. Once inside a strongly trended INTERMEDIATE MOVE, I will consider moving to a 7% Stop. When the trend starts to lose steam and might die, I simply put in a 3% Stop and call it good. I realize the 3% Stop is a bit harsh and tight, but it catches some Blow-Off Moves.
Gold and Oil are resting here, but I still like them along with some of their candidates I will mention here later.

Good Luck,

DG,

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