The market has become very much like the Little Engine That Could – slowly, but surely climbing the Mountain of Worry and pulling a train filled with clowns and circus animals.
It’s impossible to tell how far the little engine is from the inevitable top of the mountain. As we mentioned in our weekend post, we expect the market to continue grinding higher until the S&P 500 reaches the 1,565-1,570 zone, but our market forecasting ability and accuracy is as good and useful as anyone else’s.
However, until the little engine reaches the summit (and it will be hard to miss it), it’s no use jumping off the train or arguing with monkeys and clowns. Just sit back, stay with the trend, and enjoy the circus atmosphere.
Our plan remains the same as every other day: find good momentum opportunities, trade them, and go home in cash. Lately the best momentum seems to be among the low priced stocks and today was no exception. Our biggest winners (ZNGA, BVSN, NAVB, and PRKR) were all from this group. We also found a bit of momentum among our favorite large momentum stocks (GOOG and AAPL) although they didn’t help us generate much in terms of points today.
Finally, we had a decent long trade in BBRY. Say what you will about the Blackberry products or company prospects, it is hard to deny that the stock has been a great momentum vehicle. Just today, BBRY had a 14% move on huge volume and this is probably 5th or 6th such momentum day for the stock this year.
As always, we had several losers (CHTP, BVSN – 2nd and 3rd trades, UVXY – both trades), but we managed to keep them on a tight leash and minimize any damage they could do to our P&L.
March 11, 2013: +2.58 points / +0.96%
- Number of trades: 13
- Green trades: 8
- Biggest point winner: +1.52 (AAPL)
- Biggest point loser: -0.05 (UVXY)
- Biggest % winner: +4.25% (ZNGA)
- Biggest % loser: -0.59% (UVXY)
For more information about today’s trades, please see attached log.