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Monday, January 26, 2009

Looking For Positive News In A Sea Of Red Ink
Market Indices Battle to Stay Above November Lows


MODEL PORTFOLIO UPDATE:
Last week's broad-based declines took the markets back into negative momentum. The Model Portfolio has undergone a number of bearish changes that reflect that new reality, including the deletion of several profitable buy signals dating back to December.   The Model now stands at 10 buys and 6 sells.


THE MARKETS
Well, the widespread euphoria over "Hope and Change" in Washington certainly did not translate well to the financial markets.   All of the major US indices are back on negative momentum, and all of the world markets have joined them in the negative column.

The S&P 500 (SPY) has broken down through the December lows and is now struggling to remain above the low water mark for the financial meltdown.   That memorable low sits at $74.34.   The SPY got as low as $80.05 last week.   For the intermediate term, the SPY needs to stay above $80.   Failing that, we may be headed for a retest of those dreaded lows.

One of the few sectors to retain positive momentum is Gold.   Its outperformance may be due as much to its safe haven status, but a weaker dollar is certainly adding to its allure.   However, before you run out and load up on Gold shares, note that even this sector is stretched at the moment.   In fact, the weekly chart of the GLD is not getting any love from our technical indicators, which are quite bearish on the chart this week.

Among the industry sectors that are on positive momentum, Healthcare is leading the way.   Several Healthcare and Medical-related stocks made this week's Buy List.   Right behind those sectors are the Energy groups, which turned positive and look set to begin moving higher.   It has been a while since Energy saw the limelight.   Keep an eye on them to move higher from here.

Which could mean, of course, the end of the honeymoon for the Air Transport and Transportation sectors, which have been enjoying the plummet in energy prices.   A reversal of that trend could signal a round of profit-taking in the Transports.   This week's Sell List features three names from the Airline stocks.

The Covered Call Option research features February expirations and finds stocks with annualized returns as high as 301% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com
actinv@gmail.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, November 17, 2008

Flashback to 2003
Market Indices May Find Bottom Back Around Previous Bear Market Lows


MODEL PORTFOLIO UPDATE:
The S&P 500 has not seen these levels since the lows of early 2003.   Last week's decline put the indices and all of the industry sectors back on negative momentum, so we are fortunate to start the new week with an evenly balanced Model Portfolio, which now stands at 12 buys and 12 sells.


THE MARKETS
Wednesday of last week took the S&P 500 (SPY) back down to its lower Bollinger band, and Friday's action placed it just above it.   That leaves us with negative momentum across of the major indices but nearby support in the form of the October lows.   The new low-water mark is now in the $82-83 range on the SPY.   Look for a weaker open this morning, and keep an eye on this key support level.

A lot has been said and written about what to expect from the markets and where they are likely to go from here.   If you subscribe to the Buffet theory, then you are looking at the disparity between those beaten down asset classes such as stocks (see chart above) and safe havens such as Treasury bills/bonds (see chart below).   It is not a style or philosophy that suits everyone, but a sober comparison between these two charts does begin to speak to the relative value argument.

Though all industry sectors are on negative momentum, you might be interested in knowing that our technical screen this weekend produced 141 strong buy signals but only 8 strong sell signals from which to choose.   That is a contrary indicator in the face of the currently negative market momentum.   Keep that in mind as we anticipate the market's reaction around those support levels early this week.   The most technically appealing sectors include Electronics and Networking/Infrastructure, which produced a couple of (Electronics) stocks featured in this week's Buy List.

This week's Sell List features four stocks that apparently have not been beaten badly enough yet.   They represent a variety of industry sectors.

The Covered Call Option research moves out to December expirations and finds stocks with annualized returns as high as 505% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com
actinv@gmail.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, August 11, 2008

US Market Finally Gives the Green Light
Major Indices All Have Positive Momentum Now


MODEL PORTFOLIO UPDATE:
The market's recovery has allowed us to trim successful short AND long positions from the Model Portfolio this week.   A number of very profitable long trades in Biotech are now being replaced by positions in other sectors that have only recently turned positive, notably in the Financial sectors.   The Model Portfolio now stands at 23 buys and 15 sells.


THE MARKETS
At the end of June we noted that the S&P 500 was paying an important visit to the lower trading band on its weekly chart.   Since we use weekly charts as the basis for much our our swing trading research, this was clearly felt to be a defining moment for the US markets.   Though the SPY failed to hold at its lows set earlier in the year, it has rallied over the past two weeks and now finds itself back on positive momentum, and at a higher level than at that fateful level reached at the end of June.   Though a return trip to the upper trading bands may be delayed, the prospects are now bullish for the US markets for the first time in months.

Though the credit crisis may be far from over, Financial stocks have begun to show some signs of life.   The chart below shows the one year decline of the Financial Select SPDR (XLF), and as one can see, the damage in that sector has been profound.   The real beauty of the chart, however, is that it may finally be signaling that the worst is over as far as their stock prices are concerned.   The sector momentum table has most sectors, including the financials, back on positive momentum, so we took this opportunity to add some Banking and Insurance names to this week's Buy List.

This week's Sell List continues to pound away at Energy and Materials, two sectors that had a successful multi-year run that is now being puncuated with terms like "bubble" and "burst," two words that one seldom likes to hear associated with any groups that one might be holding on the long side.   Though the weekly charts of the Energy ETF's still show some of the most bearish technical outlooks, it is worth noting that many individual stocks in that sector are starting to show up on our screen of strong buy signals.   Take that as a warning that some of those stocks are now getting sufficiently washed out as to make themselves candidates for a bounce soon.

The Covered Call Option research moves out to September expirations and finds stocks with annualized returns as high as 298% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com
actinv@gmail.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, June 30, 2008

S&P 500 Tests 52-Week Lows
Large Cap Indices in Most Danger of Setting New Lows


MODEL PORTFOLIO UPDATE:
As one would expect, we stripped a few more buy signals out of the portfolio this week.   Short positions in everything except Gold have largely been rewarded of late.   The Model Portfolio now stands at 9 buys and 15 sells, its most bearish posture in quite some time.


THE MARKETS
After visiting its upper trading band in mid-May, the S&P 500 has waged a methodical sell-off, taking it coast-to-coast to its lower trading band in only five weeks.   While the media would have you believe that the end of the world is just around the corner, take a step back and consider that we are only experiencing an oscillation within what has been a fairly well behaved market cycle.   The SPY has now closed right at its lower Bollinger band in an area where it bottomed in January of this year.   That strikes us as more than a coincidence, and if the stock market does not find meaningful support here, it is missing a huge opportunity.   Do not be surprised to see some base building at these levels.

Having said that, it also pays to be cautious until we see signs of institutional buying interest.   The sector momentum table understandably looks like a train wreck, as only Biotech, Gold, and Energy have managed to survive with their positive momentum intact.   This week's Buy List does find a few strong buys worth considering in the Biotech and Gold sectors.   Energy remains strong, but most of those stocks are near the upper end of their trading ranges and are therefore largely ignored by our trading system.

This week's Sell List takes aim at a number of sectors that are available for short selling.   Despite the market correction, our research screens managed to find several names that had strong technical sell signals combined with still overbought conditions.

The Covered Call Option research moves out to August expirations and finds stocks with annualized returns as high as 208% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com
actinv@gmail.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, June 2, 2008

Bullish Tendencies
But Some Sectors Are Getting Overbought Already


MODEL PORTFOLIO UPDATE:
Only a handful of positions were trimmed from the Model this week.   Surprisingly enough, two were buy signals in the Energy sector.   The Model Portfolio now stands at 19 buys and 5 sells.


THE MARKETS
While no one was watching, the markets have been on a fairly systematic rally since mid-March.   With the exception of a few weeks that felt as if the roller coaster was hurtling lower, the S&P 500 (SPY) has steadily traversed its trading range from bottom to top, slowing only recently as it has faced resistance around its upper Bollinger band.   The SPY still enjoys positive momentum, but the overhead resistance is being strengthened by the convergence of its upper band with the 50-week moving average, which also sits around $143.50.

The key to the near-term fortunes of the market may reside in a few key leadership groups that have been market stalwarts for quite some time.   If the proverbial air begins to leak out of the speculative balloon that is known as Energy, then the sector momentum table will be looking for new leadership in a hurry.   There are indications that a summer tech rally may be lurking just down the road, as Electronics stocks headline this week's Buy List.   The iShares Goldman Sachs Semiconductor Index (IGW) is one of the higher rated sector ETF's, but like the SPY< it is also facing some near-term resistance on its weekly chart.

This week's Sell List focuses on the Financial sectors, which continue to struggle against a strong headwind posed by the credit crisis.   Experts widely disagree on the likely duration, as well as the present status, of the current crisis.   The charts suggest that we are at least six months from seeing the worst of it, since financial stocks have yet to price in a substantive recovery and thus form a recognizable bottom around these levels.

The Covered Call Option research features July expirations with annualized returns as high as 203% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com
actinv@gmail.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, April 14, 2008

Expecting An Orderly Retreat
The Market Is Still Well Within Its Trading Range


MODEL PORTFOLIO UPDATE:
We trimmed several of the older buy signals from the Model Portfolio this weekend. This does not represent a major shift in strategy, only the fact that these stocks have had a nice run over the expected time frame.     Now we shift the sector orientation and wait for the next buying opportunity.   The Model now stands at 14 buys and 9 sells.


THE MARKETS
We anticipate a temporary retreat in the markets over the next week or so.   After hitting its upper Bollinger band in early April, the S&P 500 (SPY) is due for a rest.   Though there is some uneasiness in the markets after Friday's plunge, the chart is currently well behaved.   The only real cause for concern would be in the SPY fell back under $126 and formed a new low.   In the absence of that, this should be considered a routine phase of the market's cycle as it builds a base.   The markets may, in fact, drift lower until the last week of April, when the FOMC again convenes on the 29th for another expected rate cut.

The sector momentum table is fairly evenly split between positive and negative sectors now.   Energy has returned to its usual place among the positive sectors, but something about its chart makes us hesitant to rebuild huge buy positions in Energy stocks at the moment.   In this week's Buy List we feature a few Networking/Internet stocks, whose sector enjoys one of the few positively rated sector ETF's that we could find this morning.

This week's Sell List features a laundry list of strong sell signals.   The list of negative sectors is likely to grow in the short term, so take your pick.

The Covered Call Option research features May expirations with annualized returns as high as 303% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com
actinv@gmail.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, March 24, 2008

Lining Up The New Trade
Out With the Old, In With the New


MODEL PORTFOLIO UPDATE:
The Model Portfolio underwent a not-so-subtle realignment over the weekend.   The change involves the removal of long positions in Energy and Gold and the removal of short positions in Technology and Retail.   After all was said and done, the Model now stands at a moderately bullish 16 buys and 11 sells.


THE MARKETS
After the Fed's 75 basis point cut in rates on Jnauary 22nd, we signaled the possibility that the Fed was in the process of building a floor under the market.   The $126 low on the S&P 500 SPDR (SPY) was seen as a decent indication of technical support.   As it turns out, the Fed needed to bolster the markets again on March 16th and 18th.   In doing so, the SPY once again held just above $126 for a low.   The successful retest of that support level could do wonders to prove the underpinnings of a stronger market in the coming weeks.

As we begin the new week, the SPY enjoys a modestly bullish set of technical indicators on its weekly chart.   With higher volatility likely in the near term, pay close attention to any challenges of the $126 level.   The overall health of the market relies heavily on support there.

Those changes that we alluded to in the Model Portfolio are reflected in the prominent shifts in the sector momentum table.   Energy, Gold, and Materials have fallen to the negative momentum column, while some of the Financial, Retail, and Technology issues have started to come alive again.   It may take a while before a wholesale change in sentiment occurs for Financial stocks, but in the meantime, we are seeing strong buy signals in a number of Retail and Electronics companies, several of which are featured in this week's Buy List.   The Semiconductor HOLDRS Trust (SMH) has one of the highest technical ratings of any weekly chart among the sector ETF's this week.

This week's Sell List features a number of positions in the newly negative Energy, Gold, and Materials groups.   With the commodities play taking a breather, it is the first in quite some time that short positions have been initiated in these groups.

The Covered Call Option research features April expirations with annualized returns as high as 368% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com
actinv@gmail.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, March 3, 2008

Still Holding The Line (So Far)
Despite Woes, Markets Remain Above Levels Prior to Rate Cuts


MODEL PORTFOLIO UPDATE:
Three buy signals were removed this week, some due to profit-taking and others due to a change in outlook.   The Model now stands at 15 buys and 12 sells, a slightly bullish bias as the markets test their lower trading bands.


THE MARKETS
Speaking of those trading bands, the US market indices are approaching theirs, but more importantly, they remain above the lows that they reached just prior to the 75 bps rate cut in January.   With their negative momentum, the stock market indices are likely to test the lower trading bands.   For the S&P 500 SPDR (SPY), that would happen around $132.   A visit there would likely coincide with a stochastic reading of below 20 on the daily chart, which would imply a temporary bottom in stock prices.

That the sector momentum table is currently tilted to the negative side is only of modest concern at the moment.   Our weekly research shows a total of 59 strong buy signals to only 29 strong sell signals.   Of the sectors that remain positive, the Industrial sectors are the most heavily represented in this week's Buy List.

This week's Sell List represents a wide variety of negative sectors that are highlighted.   Among them, the Transportation sector turned negative this week, and it also has one of the most poorly rated sector ETF's that we track.   Judge for yourself...

The Covered Call Option research features April expirations with annualized returns as high as 190% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, February 4, 2008

Fed Draws A Line In The Sand
Rate Cuts Reflect Seriousness in Stemming Market Losses


MODEL PORTFOLIO UPDATE:
After experiencing a visit to their lower trading bands, the market indices have returned to positive momentum.   Their recovery has also brought the Model Portfolio with them.   A large number of short positions were deleted from teh portfolio and replaced with buy signals.   The Model now stands at 18 buys and 13 sells, officially putting the Model back in bullish territory for the time being.


THE MARKETS
The US market indices spent the first few weeks of 2008 visiting their lower trading bands. Since then, the major indices have rallied off of those support levels.   The Fed has aided the recovery with two, semi-desperate cuts in short-term interest rates.   By doing so, they have effectively signaled to the investment community that the Fed will do whatever is deemed necessary to put a floor under crumbling stock prices.

The rate cuts have helped to stem the bleeding and have put the market indices back on positive momentum, for the most part.   Many of the indices look like the S&P 400 Midcap (MDY), which put in a bottom by spending a couple of weeks hovering around its lower Bollinger band.   Since then, the index has recovered by several percentage points and could easily return to the $160 area before meeting resistance.

The sector momentum table has recovered dutifully, as well.   Positive sectors once again outnumber negative ones.   Not surprisingly, with fat tax rebate checks headed to consumers in the coming months, Retail stocks have suddenly caught the eyes of investors again.   Go figure.   A couple of Retailers are featured in this week's Buy List.

Unlike the overall indices, Energy stocks have remained mired near their lows, with no signs of a technical rally yet from those levels.   Once again we find the Oil Service HOLDRS Trust to have one of the worst technical ratings of any sector ETF, and we list a few Energy ideas in this week's Sell List.

The Covered Call Option research features March expirations with annualized returns as high as 238% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, January 14, 2008

A Contrarian's Delight
Markets Finally Reach Support Levels


MODEL PORTFOLIO UPDATE:
The plunging markets have cast a decidely bearish slant on the Model Portfolio of late.   After finishing the year with a slightly bullish bias, 2008 has not been so kind to stock buyers.   The Model now stands at 9 buys and 19 sells, though the tables are expected to take a turn as soon as this week.


THE MARKETS
Back at the end of November, the markets breifly touched their lower trading bands.   They then embarked on a multi-week rallying that tacked on several percentage points.   Well, guess what? The major indices are back down at their lower Bollinger bands.   Not coincidentally, their weekly charts are now seeing strong bullish technical ratings for the first time in months.

Starting with the Nasdaq, let's size up its outlook for the coming weeks.   On the chart of the QQQQ's, we are seeing very bullish ratings, and a return to the middle of the range (around $50) is an acceptable near-term target.

The sector momentum table is understandably negative at the moment, but note that the Healthcare sectors staged a dramatic comeback last week.   All three of those sectors are now in the positive momentum column, and they dominate this week's Buy List.

Rumblings about a looming recession on the horizon may have finally started to pinch the Energy sector.   Both groups fell to negative momentum last week, and they offer up a number of attractive short sells for this week's Sell List.   Check out the weekly chart of the Oil Service HOLDRS Trust for a look at the possible beginning of a longer term downtrend for the Energy stocks.

The Covered Call Option research features February expirations with annualized returns as high as 485% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, December 24, 2007

Trying To Have A Merry Christmas
Santa Rally Turns Sideways


MODEL PORTFOLIO UPDATE:
The past three weeks have seen a pitched battle as the major indices try to stay above their support trendline.  The heightened volatility has had an effect on the Model.  Its attempts to stay ahead of the trend has sometimes resulted in short-term leanings that change rapidly.  The end result has been a year ending Model Portfolio with a moderately bullish 16 buys and 12 sells.


THE MARKETS
Since finding support at the low end of their trading ranges, the market indices have basically struggled in a sideward motion.  The December trend, if there is one, has been tepidly bullish.

Boosted by technology stocks, the Nasdaq has soldiered on relatively well.  After testing downside support last week, the Nasdaq 100 (QQQQ) lifted later in the week to close essentially in the middle of its trading range.  A slight upward bias exists with head room extending to around $55.  Downside risk remains proportionately the same, around $46.

Despite the market's recovery last week, the sector momentum table is struggling to catch up.  We have fewer positive sectors than negative ones.  The good on the tech side is being overwhelmed by the negativity of the financial sectors.  While we would have liked to have featured more tech ideas, the sector momentums do not allow it, and this week's Buy List instead favors the Healthcare, Consumer, and Industrial sectors.

Though the financial sector would seem to be an obvious place to look for short selling ideas, the horrible stochastics of many of those stocks implies that they are closer to near term bottoms than tops.  For that reason, we instead feature a handful of Biotech and Telecom ideas for your mutual disdain in this week's Sell List.  While we mentioned this weeks ago, we are seeing an alarming number of Energy stocks with strong sell signals.  Though momentum continues to favor those names, it is worth noting that Energy sector ETF's sport some of the most bearish technical indicators this week.  Keep your eyes open out there.

The Covered Call Option research features January expirations with annualized returns as high as 603% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, December 3, 2007

Thanks For The Support
Markets Bounce Where Expected


MODEL PORTFOLIO UPDATE:
We pulled a large numebr of sell ideas out of the Model Portfolio this week in recognition of the return to positive momentum in the markets.  The Model begins the week with a more balanced 10 buys and 11 sells.


THE MARKETS
When we last posted, it appeared that the SPY was headed toward support at its lower Bollinger band.  As one can see from the chart below, that is exactly where the SPY bottomed last week before embarking on a healthy rally.  The index touched a low of $140.66 before recovering as high as $149.87 during the week.  That puts the index back above its 50-week moving average, so the next level of resistance should come from the upper Bollinger band just under $157.

The sector momentum table has righted itself along with the markets.  Although more sectors are negative than positive, we are much more balanced than as recently as a week ago.  Among the sectors that look the most attractive is Retail, whose sector ETF's boast the highest technical ratings among their peers.  The Retail HOLDRS Trust (RTH) is setting up in beautiful position to take advantage of a possibly better than expected holiday shopping season.  That is not necessarily a prediction, just a solid possibility based on the charts and where expectations currently reside.  The Retail sector adds a few, quality ideas to this week's Buy List.

The next best looking sector is Biotech, which also enjoys some highly rated sector ETF's.  One of them is the Biotech HOLDRS Trust (BBH).  Could the BBH be poised to break out of a multi-year slump by breaking that persistent downtrend?  Market watchers often say to never bet the fifth cycle of any trend.  Depending on how one looks at this chart, the BBH is in either the third of fourth leg of the cycle dating back to the highs in late 2005.

The Sell List takes aim at several stocks that are still tied to the housing slump, including stocks in the Home Finance and Construction & Housing sectors.  Keep an eye out on Energy issues, as well. The Energy sector sports one of the lowest rated ETF's in our research coverage this week.

The Covered Call Option research features January expirations with annualized returns as high as 330% on selected covered writes.

Best of Luck in Your Active Trading!

Active-Investor, Inc.
http://www.active-investor.com

Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, November 12, 2007

Dee-Fense!
Most Sectors Headed Lower With The Markets


MODEL PORTFOLIO UPDATE:
The Model Portfolio slipped further into bearish territory this week.  With all but four sectors holding negative momentum, the situation is likely to get slightly worse before things start to turn around.  The Model begins the week with an uncharacteristic 6 buys and 16 sells.


THE MARKETS
After flirting with the old highs for a couple of weeks, the markets have gotten slammed over the past several trading sessions.  In October we noted that support for the S&P 500 SPDR (SPY) existed around $142.50.  After closing last week at $145.14, we now find ourselves not far away from that magic number.  Indications are for a lower opening this morning after overseas markets plunged, so an early test of support seems due for this week.

As was mentioned, the sector momentum table suffered last week, also.  Only four sectors survive with positive momentum, and they are what could be considered defensive sectors at that.  The Buy List looks to the Food, Gold, Medical Delivery, and Utility sectors for some much needed help this week.

The Sell List contains a cross section of groups that have turned negative recently.  In that category falls the Energy sectors.  While many sector ETF's sport very negative technical charts, Energy has only recently succumbed, and they may have a considerable ways to go before finding support of their own.

While stocks have zigged, the bond market has zagged, with Treasuries rising quickly in their role as a safe haven.  It may be some time before risk is rewarded again in the fixed income markets.  For the time being, Treasuries are king once again, and already they are approaching overbought levels on a weekly basis.

The Covered Call Option research features December expirations with annualized returns as high as 324% on selected covered writes.

Best of Luck in Your Active Trading!

Matt Koehler
Financial Analyst
Active-Investor, Inc.
matt.koehler@metrostocks.com
http://www.active-investor.com


Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, October 22, 2007

Markets Retreat From Highs
Nasdaq Weathers Slightly Better


MODEL PORTFOLIO UPDATE:
The Model Portfolio experienced a major shift as a result of Friday's onslaught.  A large number of buy signals were trimmed, as it is apparent that the markets will need some time to recover.  The Model begins the week with a very balanced 9 buys and 9 sells.


THE MARKETS
Back on October 1st, we posited that the S&P 500 (SPY) stood a decent chance of reaching $156, where it was likely to run into some trouble at that point.  Fast forward to last Friday. After hovering around $156 for the better part of a week, the SPY took a nosedive, dumping ballast in a hurry until it closed under $150.  The tumble sent shock waves throughout the markets, and it does not appear that the decline will reverse itself at the open this morning.  If you are looking for support levels, the 50-week moving average is around $146.55, while the lower Bollinger band on the weekly chart sits at $142.44.

By comparison, the Nasdaq has held up relatively well.  The QQQQ's have barely come off of their highs and retain a modestly bullish chart.

Regarding the sector momentum table, last week's downturn took all but a handful of sectors into the negative momentum column.  Most of the remaining positive sectors have a technology theme, so this week's Buy List leans heavily on the Computer, Software, and Networking/Internet sectors.

The Sell List enjoys a wide berth this week.  No fewer than 147 stocks hit our strong sell screen this morning.  Among those, a disproportionate number of Energy stocks showed up.  Investors apparently believe that a slowing economy is a foregone conclusion and that record high energy prices will be fleeting.

The Covered Call Option research moves out to December expirations and features annualized returns as high as 248% on selected covered writes.

Best of Luck in Your Active Trading!

Matt Koehler
Financial Analyst
Active-Investor, Inc.
matt.koehler@metrostocks.com
http://www.active-investor.com


Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, October 1, 2007

S&P 500 Nearing Resistance
Top of the Trading Range Awaits


MODEL PORTFOLIO UPDATE:
The Model Portfolio stripped out thre buy signals that had run their course.  No real underlying theme pervaded the weakness, just routine housekeeping.  The Model begins the week with 22 buys and now only 3 sells.


THE MARKETS
After finding support at its lower Bollinger band and bouncing off of the lower end of its trading range, the S&P 500 has managed to put in a few good weeks.  As it was testing its support levels, we indicated that a run to as much as $156 might be in the cards.  That still remains the best case scenario, although the SPY is now hovering just below $153.  The odds favor a test of those previous highs but trouble soon thereafter.

While the markets were advancing, the sector momentum table actually pointed to some structural weakness, as fourn sectors turned negative compared to only one newly positive group.  The positive sector is Transportation, which does add an idea to this week's Buy List.  However, Technology continues to enjoy some of the best technical ratings of any of the sectors.  The caveat is that the strong momentum of many of those stocks has already pushed them to the tops of their trading ranges.  It pays to be cautious and selective at these levels.  After all, it is October.

The Housing sector continues to bring up the rear, and it is dragging the Banking sector down with it.  Those sectors turned negative aong with Retail, which also contributes a few ideas to the Sell List.

The Covered Call Option research moves out to November expirations and features annualized returns as high as 222% on selected covered writes.

Best of Luck in Your Active Trading!

Matt Koehler
Financial Analyst
Active-Investor, Inc.
matt.koehler@metrostocks.com
http://www.active-investor.com


Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.







Monday, September 17, 2007

S&P 500 Finds Support
Markets Looking For a Reason to Climb


MODEL PORTFOLIO UPDATE:
The Model Portfolio peeled off a few sell signals as a strong week for the markets put some of the buy signals in position to reach their potential.  The Model begins the week with 17 buys and only 9 sells.


THE MARKETS
The S&P 500 managed to find support at its 50-week moving average.  Its technical indicators have improved considerably over the past three weeks, and now a further recovery is no longer out of the question.  A best case outlook might be tacking on around 4-5% to the $156 level.  Downside risk remains the $145 area, where a breech of the 50-week moving average would spell big trouble for the next couple of months.

The sector momentum table saw a few more sectors return to positive momentum.  Among those that are making noise in the Buy List this morning is the Computer sector, followed closely by Construction & Housing.  Both contribute multiple, strong buy signals to the featured buys in this week's research.  Biotech continues to offer one of the better looking sector ETF's also.

The only sector to turn negative this week is Electronics, which is somewhat surprising, given the strong performance of technology overall.  We add one Electronics idea to the Sell List, along with a smattering of Banking and Automotive stocks.

The Covered Call Option research features October expirations with annualized returns as high as 320% on selected covered writes.

Best of Luck in Your Active Trading!

Matt Koehler
Financial Analyst
Active-Investor, Inc.
matt.koehler@metrostocks.com
http://www.active-investor.com


Disclaimer: Active-Investor.com is not a broker/dealer.  No references to any investments are to be considered an offer to buy or sell any securities.  As always, investors are encouraged to weigh all research against their need to satisfy their own investment objectives.






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