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DarkToast (98.64)

S&P 820 holds. Mutual funds accumulating, shorts losing interest?

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8

January 15, 2009 – Comments (5) | RELATED TICKERS: DXO , CACB

Hello Fools,

For far too long stocks have been moving in lockstep; either nearly every stock is up, or nearly every stock is down.

This makes it easy to trade index ETFs, but I am ready to see stocks trading on their individual merits again. For a few days last week, it seemed like 'normal' trading. Some stocks gained, some stocks lost.

I have read that amatuers tend to trade in the morning, and the pros trade in the afternoon.

From October until very recently the pattern had been up in the morning, slammed in afternoon trading.

For the last couple of weeks we are seeing the opposite. The markets have been getting ravaged early, then reversing.

This site ( http://www.mffais.com/ ) will show you if your stock is being sold off or accumulated by mutual funds. Most of the stocks that I own are being accumlated.

This site (http://shortsqueeze.com/ ) will show you the amount of short interest in your stocks. For most of my stocks short interest is down.

It seems that the powerful market movers are ready for a stronger rally than what we have seen so far. Todays decisive rebound off of the S&P 820 level might help to confirm this.

People can't really have been surprised to see bad earnings reports from banks. I was happy to see it though, I finally got out of my red thumb on CACB with better than +5 points.

I picked DXO for CAPS, I almost bought some in real life but couldn't bring myself to pull the trigger. Oil will not stay below $34 a barrel for long.

Stay Foolish,

DT

5 Comments – Post Your Own

#1) On January 15, 2009 at 3:04 PM, binve (24.90) wrote:

Hey DarkToast, I very much agree with your sentiment on oil. I don't expect to see it at this level much longer and think oil is due for a rally. I like DXO, as well as USO and UCO. DXO is based on futures for the July contract, so it moves slightly differently than say UCO. But I like them all right now :)

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#2) On January 15, 2009 at 6:43 PM, guiron (< 20) wrote:

Oil will not move much until growth starts up again. I think it's too early to be bullish on it. We won't see it return to $100+ levels, however, at least not for a long time. Nearly all of that extreme run-up past $70 this past year was due to speculation. I expect it to hit around $60-70 when we see the tide lift all boats.

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#3) On January 15, 2009 at 6:47 PM, guiron (< 20) wrote:

Oh, btw, we will see the equities markets recover before the economic markets. At some point, the equities markets will stop reacting to bad news. That's bottom, IMO. From there, we probably have another 6 mo. to a year to get growth back. Sometime in that time period oil will start to move back to growth levels, but not until long after the stock market has capitulated.

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#4) On January 16, 2009 at 3:29 AM, gman444 (99.57) wrote:

Inventories are too high and demand too low for oil to move up much in the short-term.  And I'm not sure about 820 holding--maybe until post-inauguration, but think a retest of 740 is probable soon. 

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#5) On January 16, 2009 at 3:41 PM, DarkToast (98.64) wrote:

 

I agree that 820 might not hold for much past the inauguration. I don't expect oil to skyrocket, but I do expect to see it around $40. Below $35 will just makes producers cut production.

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