Dr. Kris'  Instablog

4:00pm ET: The market continues to melt up but internals are beginning to show some tiny signs of fatigue. Although I definitely wouldn't bet against the market, I wouldn't be surprised if it took a step back in the next day or so.

Today's notable market action: Toot, toot, hey, beep, beep!
Commodities continue to slump as gold and silver miners continue to sell off, some to their lowest levels not seen in years. As an example of just how far they've fallen, consider gold miner Allied Nevada (ANV, $8) which has lost more than 80% of its value since mid-October. The Gold Miner etf (GDX, $27) and the Junior Gold Miner etf (GDXJ, $11) have lost 55% and 40% respectively over the same time period. Just because these issues are well off their highs doesn't mean now is the time to step in and buy--far from it. Their charts show no signs of basing and I'd wait until they break out to the upside before initiating a long position. Remember, never try to catch a falling knife!

On the flip side, automakers were among today's winners as the following issues motored to new highs on heavier than normal volume: Fiat (FIATY, $7), General Motors (GM, $32), Ford (F, $15), Isuzu (ISUZY, $86), Nissan (NSANY, $23), Honda (HMC, $41), and Toyota (TM, $127). Most of these tacked on 2-3% to yesterday's share prices except for Isuzu which jumped 14% on three times normal volume. Most of these companies are still undervalued with P/E's hovering around 10 except for Honda and Toyota with P/E's of 19. (Fiat has the lowest P/E value of 6.) Aside from Fiat and GM, all of the above pay a dividend (most around 2%). Adding some wheel makers to your portfolio could definitely give it some traction, and that's something to toot about!

[Note: For a little topic apropos background music, check out this classic music video.]

Enough auto metaphors. That's it for today.

Subscriber Notes: There is one new Stock Darling.

4:00pm ET: CNBC dubbed Tuesday as "Rally Tuesday" noting that the equity market has rallied for all eighteen of the past Tuesdays. Not only was today no exception, but it was lead by the Transports ($DTX) indicating that another leg up is in the cards. There's nothing in the market that is hinting the bears are even close to crashing the bulls' party. Market internals are no where near contrarian levels and nearly all of the major sectors are at new highs. Heck, even the dollar is doing well!

So, where should prudent investors park their money? Well, throw a dart at a sector board and start there. All joking aside, the place to be is in equities and the two countries to be invested in are the U.S. and Japan. China's day in the sun is over--at least for now--and emerging markets could lose out if the dollar keeps rising. If you're looking for a diversified international portfolio of equities, do choose your spots carefully. Options players may wish to continue playing tracking stocks to the long side and use cash-secured puts as stock entry mechanisms.

Not much more to say today other than to paraphrase Horace Greeley: "Go long, young man, go long!"

4:00pm ET: The sun continues to shine both on both the US and Japanese markets as both countries' powerful central banks are committed maintaining a low interest rate environment as a mechanism for spurring economic growth. These actions are luring investors away from low-yielding bonds into equities which is what has been fueling this rally. Ever since Japan's Prime Minister Abe's promise to stimulate his country's moribund economy, we've been highlighting Japanese companies that trade here on US exchanges. (Scroll down to find more.) Today, we're adding other issues to that group as well as reiterating previous mentions.

In the area of financial services, both Daiwa Securities (OTCF: DSEEY, $10) and Nomura Holdings (NYSE: NMR, $9.3) jumped by 7% and 9% respectively to hit new highs. Technically, both of their charts are bullish but that of Daiwa's is more orderly. Both companies are experiencing rapid growth and if the Bank of Japan honors its commitment to continue its easy monetary policies, then there's no reason to think that the growth in well-managed securities companies won't continue to expand. If you're looking to construct your own basket of Japanese stocks, I'd definitely take a look at these two, especially Daiwa. (Trade Note: Daiwa and a few others mentioned below have fairly low trading volumes so please use limit orders when placing a trade.)

Three other companies in the Financial sector with compelling charts are MS & AD Insurance (OTCF: MSADY, $14.25) and commercial banks Mitsubishi Financial (NYSE: MTU, $7.2) and Sumitomo (NYSE: SMFG, $10). All three issues just broke out of multi-year bases and look poised to travel higher. In the Consumer Discretionary sector, auto maker Toyota (NYSE: TM, $125) continues to gain traction while badly beaten down electronics makers Sharp (OTCF: SHCAY, $5) and Sony (NYSE: SNE, $19) hurdle out of oversold bases on heavy volume. And no wonder! Despite the recent strong moves in both of these issues, their P/E's are still negative--a situation that will likely be changing and soon.

Note that all of the above mentioned companies do pay a dividend, albeit small ones (but a lot better than CD rates!). As always, please do your own due diligence before acting on any investment advice, including mine.

Sayonara until tomorrow.