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Joshua Hayes
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Joshua "MauiTrader" Hayes is CEO, President and founder of Big Wave Trading Inc., a Maui, Hawaii-based stock market advisory service. Hayes is a well-respected stock trader who combines fundamentals, technicals, psychology and money management to trade professionally for his personal,... More
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  • Stocks Digest Recent Gains with Positive Intraday Price Action 0 comments
    Sep 22, 2009 4:28 AM
    The market was able to pull back in lighter trade coming off a positive quadruple witching Friday.  Leading indicators showed a gain of .6%, but consensus estimates were for a gain of .7%.  Stocks were already showing a lower open and the release of the leading indicators did not help out stocks.  From the start volume was running well below Friday's levels, it didn't come as a surprise coming off Friday's action.  Mid-morning stocks were able to find footing and began to move higher as volume increased.  Finishing up the day the major indexes were able to finish above their mid point just off the highs of the day.  The intraday price action, was positive once again showing the underlying strength of the market.

    What is interesting about this market are the market pundits crying this market is well overbought.  Flash back to last November through March where we heard the market was constantly oversold and we had to go higher.  Mighty interestingly how things swing back and forth.  The market does not care whether or not you like it, hate it, love it, scold it, or swear at it.  It will cotninue down the path of least resistance and at this point in time the path of least resistance is higher.  Much like a rip current you swim against it the current will simply tire you out and take you out to sea.  Fighting the market trend will only widdle down your portfolio until you lose all your money or give up.

    Leading stocks were able to fend off sellers as the index outperformed the S&P500.  The NASDAQ got a boost from the NASDAQ100 as the index was able to close in positive territory.  Overall, every index I follow had positive price action on the day.  Even more importantly the NASDAQ and NYSE Composite indexes do not have a distribution day.  The Dow Jones Industrial Average and S&P 500 both have only one distribution day.  The lack of distribution on the indexes while at these levels lead me to believe we are going to move higher not lower.  Back in August we saw the market stall, but we have yet to see this action.  All signs are pointing for this market to be higher and I am not going to fight it.

    The only way my stance would change if we start seeing more and more leading stocks act like STEC.  In addition, if we start seeing distribution days pile up on the indexes then I would certainly change my mind.  Note that the distribution would have to be heavy distribution days coupled with leading stocks collapsing.  In June we saw minor distribution days and many called the top back then.  Not only did the market rebound, but the NASDAQ shot up 200 points.  If the market has its own ideas it is best to follow it.

    If the above isn't enough the amount of new lows set on the NYSE and NASDAQ was FOUR.  Only four stocks hit new lows while 363 new highs were notched.  There is nothing bearish about that unless of course you say that isn't enough new highs.  No matter how the market isn' t this or enough of that it continues to march higher.

    Do not fight the market and take the approach of one stock at a time.  No need to get cute with your positions.  As always keep your losses in check by cutting them short!

    Video One: Is available to subscribers on the forums. I do not know where my video technician is but he did not render the video for FREE/SILV subscribers. I apologize for this and I hope he can get a video up tomorrow. I tried to contact him but I had no luck. I do apologize. Aloha.

    Themes: General Market
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