Trader's Days Are Numbered

The selling is relentless however there are definitely signs of life out there (although some people think we're Space Cadets for feeling this way). Most noteworthy was the refusal for the Semiconductors to fall apart despite the downgrade from Prudential Securities. Analysts are notorious for capitulating at the exact worst moment and this seems to be a classic case. The Semiconductor group has led the market down and will likely lead the market higher. Did you notice the strength in Texas Instruments (TXN) or how about Analog Devices (ADI)? Even Intel (INTC) showed an underlying bid.

Most traders can use their own portfolio as a good indicator as to the overall health of the market. If you are loaded up with speculative names that did better than you thought they would have on a day when the NASDAQ was down this much, this is an early sign of life. Keep in mind that bailing out here is what Mr. Market would like you to do. He may try his best to scare you out, perhaps tomorrow, with a retest of the lows or even a slight breach. However, we strongly believe that it would be a mistake to "pull a Pru (Prudential)" at this point.

Bottoming action is even taking place in Cisco (CSCO) and Dell (DELL). Even Apple (APPL) which everyone believed was due for the ugliest of day's shows that it commands respect. The release of new products today by APPL certainly helped the cause. Steve Jobs should never be taken lightly and seems to be on the verge of something big again. Expect more exciting technology product announcements in the fourth quarter from other bellwether companies.

If You Held a Taser to Our Head:
The stock market has extremely low expectations, earnings season is about to kick off (most likely will come in solid), new product announcements in technology are emerging, and all fund managers are suffering from performance anxiety…hmmm…sounds like its time to take off your trading hat and put on your investing hat.

P.S. We posted yesterday how we feel that the bottom is forming in the major indexes over the next couple of days, most notably the NASDAQ. We feel that the action today does not deter us from those views. A little more capitulatory selling and retests are likely but use it to your advantage. Readers can click here to read yesterday's post.

See You Tomorrow.

___________________________________________________
The analysis, opinions and/or forecasts expressed on the Kcap Trading Blog (“KTB”) are for informational purposes only and should not be relied upon in making investment decisions. By using this site you agree that Kleiner Capital Management, LLC (“KCAP”) and its principals are not liable for any action you take or any decision you make in reliance on any content. Please be aware that there is no commitment by KCAP to update the KTB. Furthermore, there may be inconsistent timing and follow up (if any) of posts.
None of the information on KTB is considered individualized investment advice and should not be construed as a recommendation or solicitation to purchase any securities. Reliance on information provided on KTB in no way establishes an advisor-client relationship. Investors are encouraged to seek the advice of a qualified investment professional prior to investing funds.
Clients of KCAP, as well as the firm’s principals and other employees, may be invested in securities discussed at KTB. However, any mention of said securities is not intended to influence market conditions for the security to the benefit of KCAP clients and/or principals and employees. KCAP is not affiliated with any advertisers on this site and does not endorse any of their content. For additional information and disclosures, please visit www.kleinercapital.com.
The information on KTB has been furnished from sources we consider to be reliable, but no guarantee is made with respect to accuracy.
___________________________

Click Here To E-mail Comments