Fed spoke

The Fed raised expected .25 pts, Dow tanked 50 pts now, Nasdaq is only down 2 pts. Banks reverses morning's strength, back into the trading range. I think we head lower.

Morning

I don't think the market will have any big swing until Greenspan speaks. This morning the market opened with a little strength, which can be changed easily by our chairman. So let's wait patiently. Sometimes not making money is making money.

Update: GOOG

GOOG has a bearish divergence, I think GOOG is gonna pullback from here.

STEM

STEM breaking out after almost 2 months bounding range. I highlighted it over MSN today.

Crude oil

According to Briefing.com, EIA reports that crude oil inventories rose 1.1 mln barrels comparing to the consensus was a fall of 1.4 mln barrels. Let's see how much the market can rally with this bullish number.

Update: PENN

PENN finally breaking out. I brought it up over MSN yesterday.

Open

The market opened higher, but quickly retreated to the red. Semiconductors shows weakness, without its support, Nasdaq will have hard time to rally.

Bounce is a bounce

Nothing else. I know some individual movers have very impressive gains today, like CME, SHLD, but I would still see today's rally as a bounce only, nothing else. Look at qqqq's volume comparing to last two days, not encouraging at least.

Update: NCTY

NCTY continues, my favorite in Chinese plays.

Update: SIRI

SIRI breaks out its one month consolidation.

BCSI

I recommended BCSI intraday yesterday.

Strong open

The market opened strongly, with crude oil dropping below $60, end of month markup and participation of Greenspan talking. I would suggest using this opportunity to unload some longs if you still have it.

Dim Sum

Since the market is so slow, I decide to take day off earlier and have Dim Sum with my trading buddy. See you guys after close.

Slow day

I wish I had something more to report, but I don't. It is just one of those days that put you to sleep. Everybody is waiting for the Fed to speak tomorrow.

Open

After a weak open, the market has recovered a bit led by energy. Except some speculative energy plays, I have not found anything interesting yet.

Tai Wan

Tai Wan is the homebase of semiconductors. With its near the high, can techs break down hard here? (weekly chart)

Germany

German index is the Nasdaq of Europe. It is not in a down trend yet. (weekly chart)

Shorting???

How low can we go? Even though I am not bullish any more as earlier last week, I have to second think my bearish stance. Something I have to share here that prevents me from going too bearish right now.

First, other countries are either near their highs or in consolidation phase. I hardly believe we could break down very hard from here without other countries' helps. I will show you the charts of some countries I follow.

Secondly, most people get too bearish too quickly. I suddenly got two readers asking me shorting questions today. The poll at Realmoney Barometer suddenly got two bears for each bulls.

Thirdly, GOOG is still climbing and is challenging $300, the big whole number. With tech star is still shining, how bad could Nasdaq become?

So even I turned short term bearish now, I don't think we should short aggressively now. What we need is just caution, and preserving our cash.

Weekly commentary

The last two days has turned me from bullish to bearish. The selling during these two days was intense. Friday's Nasdaq volume was the heaviest since mid April. As you all know, I expected a rally coming out of the small bull flag formed from April. We were supposed to rally hard out the bullish pattern this week, instead we had hesitation and indecision actions that made me suspicious about its validation. When I heard over the phone that Dow was down 160 pts after I landed at LAX, I knew we had a bull trap. It now looks like the strong up leg we enjoyed from April through June is officially over. Cash is the king, and caution is recommended.

Past trades for the week June 20th

bot goog @ 279.5, sold @ 291.61, net 4%
bot penn @ 35, sold @ 34.47, net (2%)
bot endp @ 26.01, sold @ 25.895, net (0%)
bot goog @ 294.11, sold @ 295.38, net 0%

Update: crude oil.2

Target $61 area.

Update: crude oil

Look at what I said about crude oil
http://uclatrader.blogspot.com/2005/06/update-crude-oil.html
Longer term, I still see it in a trading range, which the high end is around $61 area.

Update: Nasdaq

What a flight can change the outlook of the market? I said the bull flag might fail if we did not have the rally soon enough. Baaaam, we had a selloff. Now the bullish pattern already failed at internet index, Nasdaq will follow, I think. Time to think twice.

Update: internet index

Sell signal triggered.

BACK

Ok, now I am officially back from my trip to Europe. Now I am back to business and I feel excited. Overall the trip is better than I expected. And I could say I love Europe, where is another place I wanna retire other than my home town Beijing. Ok, I know it is little early to talk about retirement, but as a trader, we can live any where in the world; all we need is just a computer. Actually the time schedule works pretty better in Europe than China. The U.S. market opens around 4:30 pm, and closes at 10:30pm. I kidded with girlfriend that I could even get a day time job there and still trade in evening. One of reasons I like Europe is their culture atmosphere, particularly in London or Paris. Almost every building is a history, every building has its story behind it. Also the building structures are so beautiful, which is a picture of western civilization. And I think New York just copied a small part of it, LA has none of it. I like those restaurants and coffee shops along the streets. They put most of their tables and chairs outside, the funny thing is all the chairs facing towards the street. It is like rows of seats in the movie theatre, they are watching you instead of movies.

DOW

NASDAQ

We gotta go soon, otherwise the rally may fail.

Update: LONG

A reader asked the update on LONG, here it is. I don't like its action, but it could have a big up stick any time now.

Biotech

Biotech may have some pullback at this level. I would wait a bit to initiate any biotech long positions.

GOOG

GOOG was featured in the last night's newsletter.

Hello from Belgium

I am at Brussell tonight, I am so lucky to be able to trade tonight at Belgium. Let's put the travel thing aside, market is our focus. I will tell more about my trip story later when I get back to the States this Thursday.

The market wants to go higher, which is very obvious. Why? We are facing $60 crude oil, and the market is just breaking up the little bull flag formed since April. It is telling us that something bullish is happening under the table. As a trader, we don't need to find the reason as others in CNBC. As long as we are correct and making money, why we need a reasoning?

Look at the chart of GOOG, it just doesn't wanna go down any more. GOOG is the telling of this market. As long as it holds up, we are in a bull market.

So now it is time to put your cash that is on the sideline to work, big time.

Update: KBH

KBH now is 17 pts away from my buy pt.

Update: NCTY

Please look at thoes updates I had before. It is breaking out today and more to come next week.

The bull flag

Remember what I said in last week the pullback in Nasdaq is like a bull flag, more bullish than bearish? Now I think the bull flag is resolving itself to the upside. And there are lots of individual ones breaking out. If I were not on the vacation, I would get longer this week. I hope this is what you guys have been doing.

Vacation

Sorry guys, I know I promised you guys I would post as much as possible when I am at Europe. But the busy schedule, the pricey internet rate, and f*cking French electricity outlet make me be online almost impossible. Since I joined a tour, I have been on the road from 7am to 11pm for the last two days. I tried to squeeze some minutes on the road, but I found out the rate in UK is like 15 pounds for 30 mins. I said "wow". The rate now is France is 30 euro for 2 hours. And the power outlet in France is something I never seen before, I didn't prepare an ac adapter for my laptop. And the hotel service guy told me they have given all of adapter out, so I can't charge my laptop. I said, "f*ck it". Fortunately I borrow one from a guy in my tour group. So I will share some of my thoughts on the market in the next post or two.

Update: NVDA

As I mentioned in last night's newsletter, NVDA had weak breakout yesterday, traders should get stopped out at $28 by now.

Update: LONG

LONG continues, my near term target is 13.4, which fills the gap.

Open

The market open with a little strength, with Nasdaq lagging behind Dow, I think we need more time of consolidations.

Update: crude oil

Crude oil breaks up short term resistance, it means that GEOI, ABLE have more up legs in the near future.

LONG

It was brought up over MSN this morning. I think more upside will come.

Europe

I am going to Europe from June 15th to 23rd, I will try to update the blog as much as possible. In the mean time, good luck trading.

NVDA

It was one of the picks in last night's newsletter.

BAI DU

About BAIDU's IPO, you can go to
http://www.chinastockblog.com/2005/06/baidu_to_list_i.html
As a Chinese, I know BAIDU is THE GOOG in China. So this IPO is expected lots of attentions.

Open

The market opened in red, but so far the weakness is pretty much minimal. Some Chinese plays attracts some momentum money, maybe it is getting warm up for Chinese searching engine BAIDU's IPO in July.

Weekly commentary

As I have said in the previous weeks, the market is stalling at resistance. The Nasdaq has four times since February bumped up against the 2100 area, and each time it has turned back. Most recently, it hit 2097 on June 2nd and has been mildly falling ever since. It could be an important top, but I doubt it. Because the bull flags appeared on the Internet index makes me more bullish than bearish, because the market internals are improving facing the Nasdaq's falling. The percentage of stocks trading above their 50-day moving average is at 70%, highest reading since January 3rd. That is why I say the bull market appears to be very much intact.

Past trades for the week June 6th

bot shld @ 156.5, sold @ 148, net (6%)
bot wstc @ 35.97, sold @ 36, net 0%
bot pact @ 9.59, sold @ 9.15, net (5%)
bot jmdt @ 28.27, sold @ 28.87, net 2%
bot ncty @ 22.37, sold @ 24.11, net 8%
bot bcsi @ 26.46, sold @ 24.35, net (8%)
bot mrvl @ 40.85, sold @ 40.27, net (1%)
bot ravn @ 27.19, sold @ 27.67, net 2%
bot dsti @ 8.85, sold @ 9.9, net 12%
bot geoi @ 16, sold @ 17.75, net 11%
bot dsti @ 10.22, sold @ 11.2, net 10%
bot ecol @ 15.75, sold @ 16.13, net 2%
bot scur @ 11.66, sold @ 11.34, net (3%)
bot ngps @ 28.4, sold @ 27.89, net (2%)
bot lway @ 13.44, sold @ 14.65, net 9%

Update: INX index

Update: LWAY

Nice!