Quick Market Update

by Olivier on September 15, 2011

Another quick post as I don’t have enough time to post more in-depth stuff.
On to the various stocks and sectors:

  • WPRT – Westport Innovations: Stock is acting exactly as strong stocks are supposed to act. Great separation move away form the upper boundary of the ascending triangle. At some point in time a consolidation pattern will start. For now this is a situation I typically would describe as follows: ‘The stock is not hurting anybody. Hold on to your position.’ To make a long story short, from a purely technical perspective the stock is acting right. As long as it does so, my job is to hold for much higher gains down the road. My WPRT Video Analysis and Trading Rationale
  • DAG – Agriculture ETF 2x: Stock is not acting well. I continually reduced my position as it started to go down after my entry. The stock now either goes up or I will automatically get stopped out of the remainder of my position. No hard feelings. Looking back I probably should have gone long SGG – Sugar ETF and avoided DAG’s exposure to the grains complex. Another thing that I probably didn’t pay enough attention to was the lack of volume during the up move in August. Let’s see what happens. In any case, my stop loss will take care of business. Hindsight is always 20/20.
  • Gold: The potential ‘topping tails’ candlestick pattern is probably at play. I recently highlighted the potential development of this scenario in my Gold vs. HUI Comparison Chart.
  • GDX / GDXJ: This has the potential for a failed breakout trapping longs. There is a reason why I didn’t initiate positions in mining stocks. There were simply too few of them displaying great patterns. Additionally volume on the breakout was not convincing. One of the few I am interested in is ANV – Allied Nevada Gold. A good example for serious lack of volume and lack of conviction during the breakout. To make a long story short: Not enough follow through. Overall the situation for the miners is improving. But as long as volume is not pumping in stocks like ANV I’m not game.
  • Uranium: CCJ – Cameco and DNN – Denison Mines are still falling like a rock. As long as we are in a confirmed downtrend I have zero interest in initiating positions in this sector.

Conclusion: Overall I still pretty much don’t like anything out there. I still have a large cash position and am not willing to be extremely aggressive until I see more great chart patterns setting up. A lot of the stocks I deem to be extremely interesting and worth watching are on my public list.

Administrative note: My website will most likely be down for 1-2 hours on Sunday for maintenance, testing and various software updates.

Hat tip to Charles Kirk for tonight’s quote:

Trade with an edge, manage risk, be consistent, and keep it simple. The basis of all successful trading can be summed up in these four core principles. – Curtis Faith

My public list with all my charts can be viewed here:

Buenas noches!

Previous post:

Next post: