Tuesday, May 15, 2007

Trade Ideas: SRS, SLE, KG, DO, HBC, KB, STD, HEI

Tuesday's weakness took a greater toll on small caps and tech indices as the damage filtered through the S&P and the Dow (the latter to a lesser extent by end-of-day). The Trade Ideas scan showed a sharp increase in bearish momentum with the top-8 picks covering 1 hour and 19 minutes, with the "20-appearance" list coming in at an improved 4 hours and 15 minutes. The last time the Trade Ideas scan took over an hour to pick 8 stocks was at the end of January. Back then the slowdown was followed by a 4-week rally before leading to February's big drop. If something was similar was to evolve here I would look for a move back to May highs before a major correction ensued.

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