Mike
05-14-2011, 10:10 AM
Just in time for the forum startup your moderator will be on vacation from Monday 16 May through Wednesday 25 May. This means that I will not be around to field requests to join the forum until I return.
The market is in correction. Activities while the market is in correction are to prepare watch lists and monitor the market for possible new rally conditions. In the coming days I will talk about my process for generating a watch list and I hope you will consider sharing yours. CANSLIM investing seeks to enter strong fundamental stocks at the "right time" and hold these postions possibly for many months. Compared to other methods on the EV site we week longer-term holding periods.
The market will confirm a new rally condition if and when one major index increases significantly on "day 4" or later of a rally attempt on volume higher than the day before.
As long as the indexes remain intraday above their recent lows of May 5 a rally attempt is in progress. So Monday 16 May will be day-7 count of a rally attempt on most indexes. The definition of the threshold of a significant increase is a function of underlying volatility. At this writing something like 1.4% to 1.7%. The indexes to monitor for a new confirmed rally are the NASDAQ, DOW, S&P500 and NYSE Composite. The NYSE Composite has already undercut the May-5 lows, so its rally count has been reset to zero.
Seasonably we will soon face a weak period in the market (June - August). In addition when the Fed stops QE2 at the end of June we don't know what will happen; the market can do anything it wants.
The market is in correction. Activities while the market is in correction are to prepare watch lists and monitor the market for possible new rally conditions. In the coming days I will talk about my process for generating a watch list and I hope you will consider sharing yours. CANSLIM investing seeks to enter strong fundamental stocks at the "right time" and hold these postions possibly for many months. Compared to other methods on the EV site we week longer-term holding periods.
The market will confirm a new rally condition if and when one major index increases significantly on "day 4" or later of a rally attempt on volume higher than the day before.
As long as the indexes remain intraday above their recent lows of May 5 a rally attempt is in progress. So Monday 16 May will be day-7 count of a rally attempt on most indexes. The definition of the threshold of a significant increase is a function of underlying volatility. At this writing something like 1.4% to 1.7%. The indexes to monitor for a new confirmed rally are the NASDAQ, DOW, S&P500 and NYSE Composite. The NYSE Composite has already undercut the May-5 lows, so its rally count has been reset to zero.
Seasonably we will soon face a weak period in the market (June - August). In addition when the Fed stops QE2 at the end of June we don't know what will happen; the market can do anything it wants.