Market Monitor
- The market correction is 10 days old and bulk of selling might be behind us.
- Any turn from here in my opinion will be a process. Anyone expecting a V reversal, might be in for some disappointment. Most likely course will be several attempts at rallying or sideways move which fails to downside.
- I will be watching the 50% plus in month carefully (currently at 5), it is approaching levels where a tradeable bounce might develop.
- I will also be looking at the 4% plus numbers, a number above 300 plus on this will indicate a probably sustainable rally attempt.
- I will look at survivors in 100% plus (Double Trouble) universe, IBD 200 members, recent 100 plus EPS list members which had positive post earnings reaction and have gone in to range or pulled back. These are the stock likely to bounce back first.
- On the short side a few days of rally or sideways action will set us up for low risk short in the Former Market Leader Breaking down scan.
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3 comments:
Hi, I have been a long time reader of your blog. As a college student, you have provided invaluable insight that I can not find elsewhere. For that I wanted to thank you for your great posts.
Buying a great recent earnings winner can also give you some downside protection if the market goes lower after you buy them. If a company reported truly great earnings its stock can hold up or even rally in a market this bad. Then when the market turns it will likely outperform the market.
In a related matter, if i was going to buy a homebuilder (which im not), i would buy NVR. It announced a buyback recently and it has VASTLY outperformed other homebuilders in recent history. NVR was UP 3.6% last week! How many stocks let alone homebuilders did that???
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