Didn’t I tell you?

Before we move forward –

  • First thing that I did on Sunday night after posting “Deja Vu!” is – I followed my instruction.
  • I sold 60% to 100% of my holdings in most stocks. The ones left untouched were – QCOM, STX and APA.
  • I will add some APA around $85 and some QCOM around $63.9
  • I even parted ways with some of AAPL and PCLN shares. I plan on adding some of them after they correct by 5% or market corrects shows direction .
  • I sold a major portion of my most profitable stocks of the quarter such as AAPL, PCLN, SCSS, CLR, SXCI, HLF, GNC, ALLT, FFIV, F and RHT.
  • I will wait and see the action of top stocks before I make new purchases or additional purchases. Top stocks that I will be eyeing –
    • SXCI
    • AAPL
    • PCLN
    • ULTA
    • TSCO
    • SCSS
    • TPX
    • HLF
    • GNC
    • KORS
    • LNKD
    • FFIV
    • CMI
    • RHT
    • PII
    • ALXN
    • UA
    • STX
    • WDC
    • URI
    • FOSL
  • I sold all the shares of LNKD (a minor portion), WLL (took a major hit), URI and FOSL (recently opened). Last two had gone under water prior to sale.
  • I bought TLT, BLV and RWM as mentioned on Monday morning. First thing in the morning 😉

So this is where we stand today.

  • The market averages fell sharply as the Dow dropped for the fifth day in a row losing 214 points -1.65%.  The S&P 500 lost -1.71% and the NASDAQ was down -1.83%.
  • Down volume swamped up volume on the NYSE by a 13 to 1 margin and by 12 to 1 on the NASDAQ.  Declining stocks outnumbered advancing issues by a 5.6 to 1 margin on the NYSE and 4.6 to 1 on the NASDAQ.
  • Number of stocks above 50 DMA are on a decline.
  • Let’s look at the sectors
Sector name Price from 52 Week high Price from 3 month high
XLE Energy -15.21 -10.48
XLB Materials -13.95 -7.07
XLI Industrial -7.93 -6.58
XLF Financial -10.3 -6.32
IYZ Telecom -16.48 -6.05
SPY Market Index -4.22 -4.22
XLY Consumer Disc -4.12 -4.12
XLU Utilities -5.46 -4.01
XLK Technology -3.08 -3.08
XLV Health Care -2.99 -2.99
XLP Staples -2.65 -2.65

  • The market is approaching oversold territory. Below is the graph of overbought vs oversold stocks.
  • The number of stocks declining to 52 week lows have started to exceed the number of stocks new 52 week highs.
  • Let’s look at some of the declines encountered by the leading stocks.

Good Reads –

  • China surprises with trade surplus (REU)
  • German exports unexpectedly rose (BL)
  • French economy grinds to a halt (REU)
  • European investor confidence sees decline (BW)
  • Top forecasters see euro weakness (BL)
  • U.S. small business optimism falls (NFIB)
  • Weekly retail store sales up +0.5%(ICSC)
  • Skilled-worker visas see surge in demand (WSJ)
  • U.S. profit growth still expected to stall (BL)
  • Goldman’s Dominic Wilson sees more danger (BI)

Poll Time –

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2 comments on “Didn’t I tell you?

  1. Quality watchlist, BWLD, CSTR, MA, PNRA, FIRE, TDG are some more leaders to consider

    • sumeetvatsa says:

      Yes you are correct. You can add EQIX to it as well. If we make this into a comprehensive list it will be similar to IBD 30;)

      But with earnings at the door, we should stay away from new buys. This applies to high growth/high multiple stocks.

      Few are at high reward trigger points, i.e. getting support at 50 DMA – EMC, BWLD, HLF, KORS, etc.

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