Intermediate Term Uptrends Intact
Posted by alphatrends on January 18th, 2012 at 12:22 pm, Comments: 0

Markets continue to display a healthy pattern of higher highs and higher lows above the rising 5, 10 and 20 day moving averages shown on the charts below. Yesterdays lows will be important levels for the market to hold for the remainder of the week, doing so will keep the trend intact and “innocent until proven guilty.” See yesterday’s closing video for important longer term levels for these markets.

click charts to expand

Stock Market Video Analysis 1/17/12
Posted by alphatrends on January 17th, 2012 at 4:31 pm, Comments: 0

The uptrends remain intact but with key levels on longer term timeframes it remains prudent to keep your guard high. The video below takes a look at trends for $SPY $QQQ $IWM $XLF $SMH

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Stock Market Video Analysis 1/13/12
Posted by alphatrends on January 13th, 2012 at 4:34 pm, Comments: 0

Markets were higher once again and key levels of support were defended on Friday which means the intermediate term trend remains “innocent until proven guilty.” See the video below for technical analysis of trends and key levels for $SPY $QQQ $IWM $XLF $SMH Enjoy the long weekned, don’t spend 3 days staring at charts!

Closing Numbers 1/12/12
Posted by alphatrends on January 12th, 2012 at 5:21 pm, Comments: 0

Comments in the post from midday are still valid. Subscribers can view the new market video with fresh trade ideas by logging in.

Unmotivated Sellers
Posted by alphatrends on January 12th, 2012 at 12:38 pm, Comments: 0

Sellers seem to be unmotivated as the levels we have been observing as important for support continue to hold for all of the markets. The question from here becomes, is this consolidation before further strength or is it distribution before a more meaningful pullback? When looking at longer term timeframes it appears the market is closer to more significant potential levels of resistance than support and that would suggest we be alert for signs of weakness, but for now we remain “innocent until proven guilty!”

Closing Numbers 1/11/12
Posted by alphatrends on January 11th, 2012 at 4:43 pm, Comments: 0

See comments in the post directly below

Holding Gains
Posted by alphatrends on January 11th, 2012 at 12:44 pm, Comments: 0

Markets are quiet today, but the $XLF continues to march higher towards the 200 day moving average at 13.99 and the October high of 14.17. We still have a constructive pattern of higher highs and higher lows with near term important levels to hold of $SPY ~128.20 $QQQ ~57.70 $XLF ~13.55 snd $SMH ~31.50.

The rally from the December 20 lows has now brought markets 7-8% higher without any meaningful pullback, and with a lot of the little “junk stocks” experiencing huge runs it is time to be extra cautious. The little names typically begin their runs when higher quality names have been picked over and people throw caution to the wind. It is not unusual for a pullback to begin in broader markets once this “frothy activity” occurs. Keep in mind there are no concrete signs of an imminent pullback, this is just an observation about the nature of risk management.

BTW, keep an eye on RENN mentioned on Monday in SFO article.

click charts to enlarge

Stock Market Video Analysis 1/9/12
Posted by alphatrends on January 9th, 2012 at 4:34 pm, Comments: 0

The low volume today made it seem as if the market was waiting for earnings season to begin and if that is correct, the good news is that it officially began after the close today. This video takes a look at the key technical levels of support and resistance for the $SPY $QQQ $IWM $XLF and $SMH

Quiet Consolidation
Posted by alphatrends on January 9th, 2012 at 12:41 pm, Comments: 0

Volume is light and price activity is little changed today. The standout is the $SMH which broke past the 3150 level and appears headed for a test of the 200 day moving average (not show) at 31.94. For the rest of the markets we will continue to consider them “innocent until proven guilty” in the intermediate term as long as the higher lows established last week continue to hold up.

The Facebook of China, January Effect and other Baloney!
Posted by alphatrends on January 9th, 2012 at 11:12 am, Comments: 0

It is real easy to read a clever headline and get sucked into buying a stock based on what sounds like a great story. When I find myself lured into such a scenario, my first instinct is to skim ahead to find the symbol of the stock and take a look at the chart. The company I will be making a case for is RenRen ($RENN). Before you look at the chart below, I will tell you it is one of the ugliest charts I could find right now. In fact I will further admit that I usually lose money when I buy stocks that are in such an obvious downtrend. Intrigued?

Known as “The Facebook of China” Renren ($RENN) was a much ballyhooed IPO in May of 2011. The companys shares were offered to the public on May 4, 2011 at $14.00. The first day of trading saw the stock open at 19.50 and trade as high as 24.00. That is as high as the stock has ever traded. For the next seven days in a row, the stock closed lower before trying to stabilize. The stock could not recover, the decline continued and the stock traded as low as 3.21 in the final days of 2011 before finishing the year at 3.55. For those who bought on the IPO and held, they had a loss of 74.6%. RENN was one of the worst IPOs of 2011.

Apparently their business isn’t as robust or promising as people originally thought, or perhaps investors got caught up in the frenzy of wanting to own a piece of a social media company in the most populated country on Earth. People seem to have bought the “sizzle” without looking at the quality of the steak. I skimmed a couple of articles to get a feel for their business and, while revenues were up 57% for their most recent quarter, the company is not profitable and one area of their business (Nuomi) has analysts concerned that the company is not focused on their core market.

I’m not really interested in the company Renren, but the stock appears to be a good “January Effect” bounce candidate. First, let’s understand how the January Effect works. Stocks which are down significantly at year end often experience further pressure as investors give up on the company and decide to sell the loser in order to offset gains they may have already taken in their account. Offsetting gains with losses allows investors to purge their losers and avoid paying some or all of the capital gains they may have already taken. It is also common for funds to sell their position in a stock like RENN so they don’t “look bad” for owning such a piece of shit in their yearend holdings disclosure. This is known as window dressing, they try to make their portfolio look good for investors.

Read the rest of the article and SEE THE TERRIBLE CHART HERE