The stock market failed to hold onto its earlier gains, ending mixed on the session, with the Dow and S&P 500 essentially flat while the Nasdaq had a modest decline. Crude oil traded at new all time highs early in the session, but closed with only modest gains. Overall, it was a fitting end to the third straight quarter with declines in the stock market.
Again, however, our list of Ultimate Stocks performed admirably, although many traded well off their highs.
The third quarter begins tomorrow and there will likely be significant portfolio shuffling. After that, expect light trading during the rest of this holiday shortened week.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Monday, June 30, 2008
Sunday, June 29, 2008
Weekly Stock Market Re-cap
Weekly U.S. Stock Market Commentary
The U.S. stock market closed out the week with the Dow making new Bear Market lows and the S&P 500 sitting less than 2% above its March lows. The Nasdaq and ND 100 have performed much better, and actually finished Friday’s trading in unchanged territory. Some are calling this a key reversal, particularly since volume was heavy on Friday. However, the trading range on the day was a bit narrow in my opinion for this to be any type of significant bottom. We may get a decent bounce from here, but the trend is still down.
The market suffered from a confluence of events this past week. Currency markets are now waiting for the Fed to indicate it is ready to raise interest rates to stave off further inflation worries in the U.S. The European Central Bank indicates it may be ready to do so, and this is pressuring the Dollar. That in turn has allowed Crude Oil prices to continue upward.
On top of all this is continued weakness in the financial sector and in the auto industry. Furthermore, a couple technology giants, Oracle and Research in Motion, gave weak guidance toward the later half of the year. As a result, the Nasdaq finally joined the Dow in the onslaught that occurred this week. Still, it is well above its March lows due to strong rallies in RIMM, AAPL and other tech stocks since the March lows. However, these appear to have rolled over.
One other ominous note is the continued relatively low readings in the VIX. The VIX is a sentiment indicator involving options trading, and high readings tend to coincide with bottoms in the market. The VIX closed at about 23 on Friday, which is well below the March highs in this indicator that coincided with the March lows in the market. This suggests that there is no panic selling in the market just yet, which is what we will need to put in a bottom.
ULTIMATE STOCKS
This was a volatile week for our Ultimate Stocks. These are largely tied to the strength in energies and industrial and agricultural commodity prices due to the existing global trends. A number of these stocks have had huge runs recently, and some profit taking was recommended last week, particularly in JRCC, one of the best overall performers in the market in the last 12 months.
Current Open Positions
1. JRCC – closed at $54.83, down $5.13 for the week
2. ANR – closed at $102.83, up $8.03 for the week
3. FDG – closed at $93.75, up $5.25 for the week
4. WLT – closed at $107.90, up $8.10 for the week
5. SQM – closed at $47.25, down $4.46 for the week
6. CMP – closed at $79.90, down $4.65 for the week
7. BZP – stopped out on Wednesday, do not take the new breakout
8. CLF – new trade this week at $112.00 level – closed at $111.32.
Stocks to Watch
1. CEDC – Buy signal at $76.00
2. SWN – Buy signal at $50.50
3. FLS – Buy signal at $141.00
That concludes our coverage for this week!
Good Trading!
Scott Cole
www.ultimatestocktradingsystem.com
www.kungfutrader.com
The U.S. stock market closed out the week with the Dow making new Bear Market lows and the S&P 500 sitting less than 2% above its March lows. The Nasdaq and ND 100 have performed much better, and actually finished Friday’s trading in unchanged territory. Some are calling this a key reversal, particularly since volume was heavy on Friday. However, the trading range on the day was a bit narrow in my opinion for this to be any type of significant bottom. We may get a decent bounce from here, but the trend is still down.
The market suffered from a confluence of events this past week. Currency markets are now waiting for the Fed to indicate it is ready to raise interest rates to stave off further inflation worries in the U.S. The European Central Bank indicates it may be ready to do so, and this is pressuring the Dollar. That in turn has allowed Crude Oil prices to continue upward.
On top of all this is continued weakness in the financial sector and in the auto industry. Furthermore, a couple technology giants, Oracle and Research in Motion, gave weak guidance toward the later half of the year. As a result, the Nasdaq finally joined the Dow in the onslaught that occurred this week. Still, it is well above its March lows due to strong rallies in RIMM, AAPL and other tech stocks since the March lows. However, these appear to have rolled over.
One other ominous note is the continued relatively low readings in the VIX. The VIX is a sentiment indicator involving options trading, and high readings tend to coincide with bottoms in the market. The VIX closed at about 23 on Friday, which is well below the March highs in this indicator that coincided with the March lows in the market. This suggests that there is no panic selling in the market just yet, which is what we will need to put in a bottom.
ULTIMATE STOCKS
This was a volatile week for our Ultimate Stocks. These are largely tied to the strength in energies and industrial and agricultural commodity prices due to the existing global trends. A number of these stocks have had huge runs recently, and some profit taking was recommended last week, particularly in JRCC, one of the best overall performers in the market in the last 12 months.
Current Open Positions
1. JRCC – closed at $54.83, down $5.13 for the week
2. ANR – closed at $102.83, up $8.03 for the week
3. FDG – closed at $93.75, up $5.25 for the week
4. WLT – closed at $107.90, up $8.10 for the week
5. SQM – closed at $47.25, down $4.46 for the week
6. CMP – closed at $79.90, down $4.65 for the week
7. BZP – stopped out on Wednesday, do not take the new breakout
8. CLF – new trade this week at $112.00 level – closed at $111.32.
Stocks to Watch
1. CEDC – Buy signal at $76.00
2. SWN – Buy signal at $50.50
3. FLS – Buy signal at $141.00
That concludes our coverage for this week!
Good Trading!
Scott Cole
www.ultimatestocktradingsystem.com
www.kungfutrader.com
Thursday, June 26, 2008
Dow Makes New Bear Market Low
The U.S. stock market got hit by a perfect storm today, resulting a big declines across the board. Currency traders were disappointed in the Fed’s rhetoric yesterday, which suggested they will not raise rates to prop up the Dollar and fight inflation any time soon. As a result, the Dollar fell hard against the Euro, resulting in big moves to the upside in Crude Oil and Gold. The market was also hit by weak outlooks for tech giants Research in Motion (RIMM) and Oracle, which were both hit hard during today’s trading.
The end result of the day is that the Dow Jones made a new low for the year, closing below the January lows. None of the other major indexes closed at new lows for the year, and in fact, the Nasdaq is still well above its lows. However, it is clear that the bears have the upper hand in this market and it is a good idea to stay on the sidelines.
Our list of Ultimate Stocks performed well in the face of the weakness, as they are tied to the energy markets. However, these stocks are looking a bit tired, and if you have not taken some profits yet, now may be a good time. These stocks include JRCC, FDG, WLT, ANR and SQM.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
The end result of the day is that the Dow Jones made a new low for the year, closing below the January lows. None of the other major indexes closed at new lows for the year, and in fact, the Nasdaq is still well above its lows. However, it is clear that the bears have the upper hand in this market and it is a good idea to stay on the sidelines.
Our list of Ultimate Stocks performed well in the face of the weakness, as they are tied to the energy markets. However, these stocks are looking a bit tired, and if you have not taken some profits yet, now may be a good time. These stocks include JRCC, FDG, WLT, ANR and SQM.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Monday, June 23, 2008
Ultimate Stocks - Monday June 23, 2008
The stock market was flat to down today, with the Nasdaq again leading the way to the downside, while the Dow and S&P were essentially flat. The big move in the markets today was Gold, which sold off early in the morning, before bouncing off of its lows. This was on the back of some Dollar strength overnight. Crude Oil rallied another dollar and change, and looks to be poised to test the upper limits of its recent trading range.
Our list of Ultimate Stocks continued to soar, with the exception of FLS, a recent breakout, which failed and hit its stop loss today. Otherwise, strong gains were seen in JRCC, WLT, FDG, ANR, and SQM. CMP was down a bit, but rallied off of its lows, and BZP was up 80 cents. CLF is a new position, as it broke out to new highs today.
Good trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Our list of Ultimate Stocks continued to soar, with the exception of FLS, a recent breakout, which failed and hit its stop loss today. Otherwise, strong gains were seen in JRCC, WLT, FDG, ANR, and SQM. CMP was down a bit, but rallied off of its lows, and BZP was up 80 cents. CLF is a new position, as it broke out to new highs today.
Good trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Sunday, June 22, 2008
Weekly Market Recap - Ultimate Stocks
The U.S. stock market continued its recent trend of weak Fridays, with the Dow Jones off over 200 points on Friday. Even the Nasdaq was down sharply, and was the weakest index on the day. The Dow and S&P 500 are poised to re-test their March and January lows, and this could happen as soon as this week, or in the next month or so. Although there appears to be a good bit of bearish sentiment in the market, it is not necessarily being reflected in the VIX. The VIX is a good sentiment indicator reflecting trader panic/complacency. The higher the figure, the more panic there is, and peaks in the indicator tend to coincide with significant bottoms. The VIX closed Friday at about 23, way below the March close of 32. As such, expect a continued downtrend in the overall market.
Crude Oil opened strongly on Friday on word that Israel conducted military exercises simulating an attack on Iran. This was one reason for weak stocks, while there was also some weak economic data as well. Ultimately, Crude traded in a very narrow range on Friday, and it appears to be locked into the $130 to $140 trading range.
Bonds staged a nice rally on Friday, while the Dollar was pretty weak. Its recent 3 month breakout to the upside has failed, and it looks possible that the Dollar may test its recent lows.
In other commodities, the softs continue to show strength as Cocoa is at contract highs, while Coffee and Sugar rallied sharply on Friday. The grain markets were all lower on Friday. There were no significant moves in the metals markets.
In regard to our list of Ultimate Stocks, traders should consider booking some profits in most of these issues, particularly JRCC, which is up nearly 200% since its breakout in April. ANR, WLT, FDG and SQM have all enjoyed big runs, and are due for a pullback, which could be significant, if there is a big pullback in Crude and the grain markets.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
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Crude Oil opened strongly on Friday on word that Israel conducted military exercises simulating an attack on Iran. This was one reason for weak stocks, while there was also some weak economic data as well. Ultimately, Crude traded in a very narrow range on Friday, and it appears to be locked into the $130 to $140 trading range.
Bonds staged a nice rally on Friday, while the Dollar was pretty weak. Its recent 3 month breakout to the upside has failed, and it looks possible that the Dollar may test its recent lows.
In other commodities, the softs continue to show strength as Cocoa is at contract highs, while Coffee and Sugar rallied sharply on Friday. The grain markets were all lower on Friday. There were no significant moves in the metals markets.
In regard to our list of Ultimate Stocks, traders should consider booking some profits in most of these issues, particularly JRCC, which is up nearly 200% since its breakout in April. ANR, WLT, FDG and SQM have all enjoyed big runs, and are due for a pullback, which could be significant, if there is a big pullback in Crude and the grain markets.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
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Thursday, June 19, 2008
Techs lead market rally, Crude drops sharply
Crude Oil failed to build on Wednesday’s gains and sold off sharply today, providing a boost to the stock market. Techs appear to be set to take over the leadership from commodity based stocks, which got hit hard today. Interestingly, bonds went the same direction as Crude Oil, as rates rose as bond prices reversed course today. In the face of this action, the Dollar held very steady.
Other commodities were generally mixed today, with a bias to the downside. I think we are at a tipping point here. Crude Oil fell on news that Saudi Arabia intends to boost production by 200,000 barrels, and China is reducing some of its gasoline subsidies to consumers there. It was also noted on CNBC today that the U.S. still has not tapped into any Iraqi oil. Four big oil companies will now be involved in bringing that oil to market. Nonetheless, the market still needs to prove that it wants to go down. The first psychological level to the downside is $130, and there is a sizable gap between about $128.20 and $131.86 that can be filled. Meanwhile, the 20 day moving average on the August contract is about $131. Still, primary support is all the way down at $122.50.
If Crude Oil can drop significantly, there could be a sizable rally in the stock market. But, in spite of today’s rally, it was nowhere near big enough to suggest the current downtrend is over. Still, it is clear that Tech stocks will start to take over leadership.
In regard to our list of Ultimate Stocks, they took a big hit today, and several on huge volume. This is a sign of at least a short term top. In a stock such as JRCC, it would be prudent to take some profits off the table on Friday if you did not do so today. A breach of Wednesday’s low of $54.40 would be another good place to take some profits. Occasionally, on a day after a day like today, the market opens lower, and actually makes a new high. If that high is on lower volume, you have been presented with a fabulous chance to get out very close to a top.
In any event, I think it is a good time to take at least a third and possibly half of our chips off the table in stocks such as JRCC, WLT, ANR, FDG, and SQM. BZP was a recent breakout and that breakout may fail.
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Other commodities were generally mixed today, with a bias to the downside. I think we are at a tipping point here. Crude Oil fell on news that Saudi Arabia intends to boost production by 200,000 barrels, and China is reducing some of its gasoline subsidies to consumers there. It was also noted on CNBC today that the U.S. still has not tapped into any Iraqi oil. Four big oil companies will now be involved in bringing that oil to market. Nonetheless, the market still needs to prove that it wants to go down. The first psychological level to the downside is $130, and there is a sizable gap between about $128.20 and $131.86 that can be filled. Meanwhile, the 20 day moving average on the August contract is about $131. Still, primary support is all the way down at $122.50.
If Crude Oil can drop significantly, there could be a sizable rally in the stock market. But, in spite of today’s rally, it was nowhere near big enough to suggest the current downtrend is over. Still, it is clear that Tech stocks will start to take over leadership.
In regard to our list of Ultimate Stocks, they took a big hit today, and several on huge volume. This is a sign of at least a short term top. In a stock such as JRCC, it would be prudent to take some profits off the table on Friday if you did not do so today. A breach of Wednesday’s low of $54.40 would be another good place to take some profits. Occasionally, on a day after a day like today, the market opens lower, and actually makes a new high. If that high is on lower volume, you have been presented with a fabulous chance to get out very close to a top.
In any event, I think it is a good time to take at least a third and possibly half of our chips off the table in stocks such as JRCC, WLT, ANR, FDG, and SQM. BZP was a recent breakout and that breakout may fail.
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Wednesday, June 18, 2008
Wednesday Stock Market Commentary
The stock market opened lower and continued to trade down the rest of the day on the back of some weak earnings reports. Most of the important averages were down 1% or more, with the Russell 2000 down the least, off 0.80%. With today’s weakness, the Dow Jones broke through last week’s lows, and briefly traded below 12,000. The other major averages are still above last week’s lows, and in the case of the Nasdaq and Russell 2000, well above those lows. The Dow and S&P continue to be weighed down by financial stocks.
Once again, in the face of a down stock market, our list of Ultimate Stocks continued their strong gains, lead again by JRCC, up nearly $5.00. WLT, ANR, SQM and FDG all posted nice gains, while BZP lagged and was essentially flat for the day. JRCC has clearly gone into parabolic mode, and traders would be smart to tighten initial trailing stops considerably to lock in a good part of these impressive gains.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Once again, in the face of a down stock market, our list of Ultimate Stocks continued their strong gains, lead again by JRCC, up nearly $5.00. WLT, ANR, SQM and FDG all posted nice gains, while BZP lagged and was essentially flat for the day. JRCC has clearly gone into parabolic mode, and traders would be smart to tighten initial trailing stops considerably to lock in a good part of these impressive gains.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Tuesday, June 17, 2008
Ultimate Stocks - Tuesday stock market commentary
The stock market closed the day a bit lower, after opening higher on the back of an earnings report by Goldman Sachs. The opening rally was short lived, as the market did not like the bad inflation report, nor weaker housing starts. As a result, it looks like the market is ready to test last week’s lows.
In other markets, commodities were mixed. Crude Oil traded in a very narrow range ahead of Wednesday’s supply report. Gold was also essentially flat and the grain markets were up modestly. The Dollar was also down modestly, but looks to be ready to test last week’s highs. At the same time, interest rate futures traded up a bit today, but appear to be set to test last week’s lows. Clearly there is a bit of an inverse correlation between the Dollar and Treasury futures these days.
Once again, in a down market, even with Crude Oil flat, our list of Ultimate Stocks continued to perform well, led by JRCC. WLT, FDG and SQM all posted sizable gains. JRCC is now up 170% since its Ultimate system breakout in April. It is seriously due for a pull back, as it is up over 20% in the last week.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
In other markets, commodities were mixed. Crude Oil traded in a very narrow range ahead of Wednesday’s supply report. Gold was also essentially flat and the grain markets were up modestly. The Dollar was also down modestly, but looks to be ready to test last week’s highs. At the same time, interest rate futures traded up a bit today, but appear to be set to test last week’s lows. Clearly there is a bit of an inverse correlation between the Dollar and Treasury futures these days.
Once again, in a down market, even with Crude Oil flat, our list of Ultimate Stocks continued to perform well, led by JRCC. WLT, FDG and SQM all posted sizable gains. JRCC is now up 170% since its Ultimate system breakout in April. It is seriously due for a pull back, as it is up over 20% in the last week.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Sunday, June 15, 2008
Nice Friday Rally for Stocks
The U.S. stock market closed out the week on a positive note Friday, and ended the week basically flat. The markets received positive economic news with better than expected inflation data. After a positive open, they rallied into the close. Still, this rally remains within the confines of a short term downtrend, which can only be broken with a close above 12,500 on the Dow Jones and about 1380 on the S&P 500.
The NASDAQ and ND-100 have much better stock charts. They can reverse their short-term trends just be closing up about 1% above Friday’s close.
What we would like to see in the next 4 to 7 trading days is a sizable rally in the averages, similar to today, but with at least a 2% gain in the Dow and S&P.
The U.S. Dollar enjoyed another solid gain on Friday, and closed the week three month highs. It now appears that the Dollar is in the midst of at least an intermediate term trend. Presently, it is strongest against the Japanese Yen, and is now gaining strength against the Euro.
The Dollar has benefited recently from fast rising U.S. interest rates. Treasury yields closed on Friday at their highest levels in since December.
Energy futures closed mixed on Friday, but remain entrenched in solid opportunities. Recently, I suggested that Crude Oil looked to be at the start of a bubble, when it moved up over $10 last Friday. However, it spent the past week consolidating gains. As such, it looks like it is setting up for at least one more surge upward.
Grain futures continued their recent rallies on the back of flooding in the U.S. Midwest cornbelt. Devastating floods have submerged potential corn fields, delaying plantings for weeks. This will make the plants more susceptible to a freeze late in the season since the plants will not be mature until later than normal.
ULTIMATE STOCKS
Current Open Positions
1. JRCC – closed at $48.64, up $8.74 for the week.
2. ANR – closed at $94.25, up $7.30 for the week.
3. FDG – closed at $82.91, up $2.25 for the week
4. WLT – closed at $98.14, up $4.19 for the week
5. SQM – closed at $45.45, up $2.72 for the week
6. CMP – closed at $81.97, up $.97 for the week
7. BZP – closed at $26.10, up $2.82 for the week – this was a new breakout on Thursday
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
The NASDAQ and ND-100 have much better stock charts. They can reverse their short-term trends just be closing up about 1% above Friday’s close.
What we would like to see in the next 4 to 7 trading days is a sizable rally in the averages, similar to today, but with at least a 2% gain in the Dow and S&P.
The U.S. Dollar enjoyed another solid gain on Friday, and closed the week three month highs. It now appears that the Dollar is in the midst of at least an intermediate term trend. Presently, it is strongest against the Japanese Yen, and is now gaining strength against the Euro.
The Dollar has benefited recently from fast rising U.S. interest rates. Treasury yields closed on Friday at their highest levels in since December.
Energy futures closed mixed on Friday, but remain entrenched in solid opportunities. Recently, I suggested that Crude Oil looked to be at the start of a bubble, when it moved up over $10 last Friday. However, it spent the past week consolidating gains. As such, it looks like it is setting up for at least one more surge upward.
Grain futures continued their recent rallies on the back of flooding in the U.S. Midwest cornbelt. Devastating floods have submerged potential corn fields, delaying plantings for weeks. This will make the plants more susceptible to a freeze late in the season since the plants will not be mature until later than normal.
ULTIMATE STOCKS
Current Open Positions
1. JRCC – closed at $48.64, up $8.74 for the week.
2. ANR – closed at $94.25, up $7.30 for the week.
3. FDG – closed at $82.91, up $2.25 for the week
4. WLT – closed at $98.14, up $4.19 for the week
5. SQM – closed at $45.45, up $2.72 for the week
6. CMP – closed at $81.97, up $.97 for the week
7. BZP – closed at $26.10, up $2.82 for the week – this was a new breakout on Thursday
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Thursday, June 12, 2008
Ominous Day for Stocks
Stocks opened the day quite strong, recovering almost all of Wednesday’s losses, before pulling back in the afternoon, and closing in the lower half of the trading range on Thursday. The initial impetus to the upside was decent economic data in the morning, particularly the retail sales report, which came out stronger than expected. The market clearly was affected by the performance of Crude Oil on the day, which opened much lower, only to rally significantly from its lows to post a modest gain. The chart pattern for the last few days suggests that Crude Oil may be ready to try another move to the upside.
Bond prices dropped quite a bit today on the stronger economic data, and continued inflationary concerns. The charts are looking quite ominous for interest rate futures. The December Eurodollar futures are now pricing in interest rates over 3% on the short end for later in the year, suggesting that the Fed will begin tightening very soon. It will be difficult for the stock market to rally in the face of rising interest rates. Furthermore, you can forget about any recovery in the residential real estate market in the face of climbing mortgage rates.
On the other hand, the Dollar began a nice rally over night that continued into the U.S. session, closing at its highest level since early March. More stability in the Dollar will ultimately allow interest rates to stabilize, which will help stocks. So, while we presently have some negative forces at work, in the long run, keep an eye on the Dollar!
In other commodities, Natural Gas continued to rally, as did Corn, Soybeans and Cocoa. Gold fell on the day, and clearly is trading in an inverse correlation to the Dollar.
Our list of Ultimate Stocks had a pullback today. $86 to $88 is critical support for WLT. Closing at $91.13 today, this stock is up nearly 50% from its breakout level, which occurred in late March. JRCC is up over 100% from its breakout, which occurred in April. This stock is very extended. Closing over $45 today, it has trendline support at just under $41. Traders should take some profits in that stock on a break of that level. ANR also is quite extended, and profits should be taken on any break below $80.50. Finally, traders should consider taking some profits in FDG on a break below $76. FDG actually made a new high today, before pulling back.
These Ultimate stocks were in the groups that led the market higher during its rally off the March lows. They are now quite extended, and clearly tied to the commodity rallies, particularly in Crude Oil. As such, it is prudent to keep an eye on those markets. When they finally top out, these stocks likely will as well.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Bond prices dropped quite a bit today on the stronger economic data, and continued inflationary concerns. The charts are looking quite ominous for interest rate futures. The December Eurodollar futures are now pricing in interest rates over 3% on the short end for later in the year, suggesting that the Fed will begin tightening very soon. It will be difficult for the stock market to rally in the face of rising interest rates. Furthermore, you can forget about any recovery in the residential real estate market in the face of climbing mortgage rates.
On the other hand, the Dollar began a nice rally over night that continued into the U.S. session, closing at its highest level since early March. More stability in the Dollar will ultimately allow interest rates to stabilize, which will help stocks. So, while we presently have some negative forces at work, in the long run, keep an eye on the Dollar!
In other commodities, Natural Gas continued to rally, as did Corn, Soybeans and Cocoa. Gold fell on the day, and clearly is trading in an inverse correlation to the Dollar.
Our list of Ultimate Stocks had a pullback today. $86 to $88 is critical support for WLT. Closing at $91.13 today, this stock is up nearly 50% from its breakout level, which occurred in late March. JRCC is up over 100% from its breakout, which occurred in April. This stock is very extended. Closing over $45 today, it has trendline support at just under $41. Traders should take some profits in that stock on a break of that level. ANR also is quite extended, and profits should be taken on any break below $80.50. Finally, traders should consider taking some profits in FDG on a break below $76. FDG actually made a new high today, before pulling back.
These Ultimate stocks were in the groups that led the market higher during its rally off the March lows. They are now quite extended, and clearly tied to the commodity rallies, particularly in Crude Oil. As such, it is prudent to keep an eye on those markets. When they finally top out, these stocks likely will as well.
Good Trading!
Scott Cole
www.theultimatestocktradingsystem.com
www.kungfutrader.com
Wednesday, June 11, 2008
Crude oil Surges, Stocks Plummet, but not our Ultimate Stocks!
Crude Oil posted another $5 gain today on the back of this morning’s oil supply report, which indicated a drawdown in supplies. Stocks were set to open lower, and the oil report and the Fed’s beige book report helped exacerbate the losses to the downside. The dollar pulled back a little after making nice gains the last couple of days. It remains strongest against the Yen, and may finally be attempting a serious bottom against the Euro.
In the commodity markets, the big run up continued in the grains on the back of the flooding in the midwest, which is delaying the planting season for Beans and Corn. Wheat continues to rally in sympathy, and appears to have put in a solid short term bottom.
Our list of Ultimate Stocks performed very well today due to the run up in Crude Oil. One stock, SID, would have been exited completely by our model on Tuesday. The other stocks, JRCC, ANR, WLT and FDG continue to perform well in the face of a down market. These stocks are clearly tied to the rallies in crude oil, and other energy related commodities, such as coal. They will likely fall hard if and when crude oil finally tops out.
Scott Cole
http://www.theultimatestocktradingsystem.com/
www.kungfutrader.com
Good Trading!
Scott Cole
In the commodity markets, the big run up continued in the grains on the back of the flooding in the midwest, which is delaying the planting season for Beans and Corn. Wheat continues to rally in sympathy, and appears to have put in a solid short term bottom.
Our list of Ultimate Stocks performed very well today due to the run up in Crude Oil. One stock, SID, would have been exited completely by our model on Tuesday. The other stocks, JRCC, ANR, WLT and FDG continue to perform well in the face of a down market. These stocks are clearly tied to the rallies in crude oil, and other energy related commodities, such as coal. They will likely fall hard if and when crude oil finally tops out.
Scott Cole
http://www.theultimatestocktradingsystem.com/
www.kungfutrader.com
Good Trading!
Scott Cole
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