Monday, June 26, 2006

Fallondpicks.com: Weekend commentary

Newsletter, Members Click Here Friday's action brought a little bear side action into what has recently become an area of tight trading. The heavier volume upside from Wednesday dominates, both with respect to volume and the hold of its lows. Friday's light losses were enough to register potential breakdowns of weekly support, as drawn from the indices most recent reaction lows in the Dow, semiconductor index and to a lesser extent the NASDAQ 100. These breakdowns are by no means convincing, but they tilt the markets in favor of further downside in the short term (but holding to an intermediate bullish bias).

As the indices battle it out between the bulls and bears, the secondary tech indicators [$NASI, $NAA50 and $BPCOMPQ] continue their drift into deeper bullish territory. It would be preferable to see the $BPCOMPQ in the 30s and the $NASI around -1,000, but with the former hovering around 40 and the latter in the -800s it should bring good news for bulls. Certainly another downside dip would further pressure these indicators and provide another jolt to volatility.

Bears may win out by year end but bulls have the best chance to profit over the coming months. With indicators as oversold as they are it makes sense to run with historical form.

Newsletter Update:

As summarized for the week. CSGP drifted after its breakout, below the 50-day MA and into its stop price for a 13% loss. The stock featured for June 5th. MFB ran into a similar problem on Thursday. The May 11th stock collapsed below its 50-day MA after a period of sideways trading and was stopped out for a 10% loss. RSYS failed in its second attempt to break. The May 1st and June 2nd play closed for a 4% loss and a 6% loss respectively. VLY featured as a Breakout for June 16th but failed to live up to its initial billing, even though it was able to close on its 50-day MA on a bullish hammer (a new stop could be placed 10 cents below Friday's lows) it hit its stop price for a 4% loss. However, the March 14th Subscriber play closed for a modest 5% gain. BDY featured as a Subscriber pick for June 1st. The stock crashed through its 200-day MA on disappointing earnings. The play closed for an 8% loss. GBVS was a speculative OTC BB play which was able to finish the day on a small bullish hammer, but not before it clipped its June 15th Subscriber stop price for an 8% loss too. MYOG retreated below its May 22nd stop price after an initially promising bounce (+12%) retested its lows. The play closed for an 8% loss.

 
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