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RVB's Market Musings

What began here as an avenue to interact and learn has far exceeded those goals.

If you are a prospective employer, please consider this site a place where you can see my passion for investing...

Wednesday, October 26, 2005

The gamble would have worked...

Woulda, coulda, shoulda....but, at least I didn't lose money.

LCAV gapped up on its earnings report. Now we might be able to change our minds about the counter-trend trade, and see if we should be a bull on LCAV now. I'm not going to investigate it any further, however.

When's the buyable bottom coming?

I've been watching the markets. Many of my little indicators are showing that this rally might actually have some legs. But, It hasn't acted normal. The reason I say this is that reversals usually "retest" themselves. What I mean is that they usually hit a low, then rally, come back to the low - even make a slightly lower one, and then the rally is on.

The psychological indicators - %bull / %bear are ready to roll. The exchanges have hit major bottoms in terms of record high / lows. Things look like they're in line. But things aren't normal just yet. So, I'm confused, and I'm staying away for now.

Japan, the EWJ and JOF look poised to run. I think there's great opportunity there. I also think that there's a chance that if we get back to the old recent low, say, 2040 on the Nasdaq, it could be close to time to get long some Powershares. I like these ETF's - they take out some risk, and I don't have lots of time these days!

Monday, October 17, 2005

A gamble trade...

I looked at a chart of LCA Vision tonight, and saw that the stock has been headed lower for quite some time.

However, I also noticed that the stock was oversold on weekly and daily charts, and noted that price was near the 52 Week Exponential Moving Average on the weekly chart. Checking the daily chart, you'll notice a triple (maybe even quadruple) bullish divergence shown by the Force Index. This indicates that LCA is likely to see higher prices in the short term.

However, I view the trade as marginal, with a price target of only $37-$39, which is a $2-$4 gain. And, what looks like to me is trade that currently needs about a $2.50 stop, thus the reward-to-risk ratio is a mere 1 or 2 to 1. It's certainly possible that LCAV sees $42.50, which would make the trade a good one, but that's seemingly the best-case scenario. All this means that it's not a very compelling trade, especially given that the overall market is just ugly right now.

Friday, October 14, 2005

A Post

Man, there's not much to look at yet in the markets. Stay away. Yeah, there's a bounce back today, but I don't put too much stock in it at this point.

If you took my oil stock short advice a few weeks ago, you're probably smiling from ear to ear all day long, but be quick to watch for a potential snap back. I still believe those stocks are topping, but there may be a retest coming. Try not to get too caught up in predicting the market, instead focus on how you will react to what it does.

Kohl's (KSS) formed a nice tail on Wed, and there was a potential swing trade there, but I didn't get a chance to post it in time.

Other than that, keep the cash ready - you'll never know when you need it!