There was nothing in the scans that looked like it had to be taken as a short. However, a familiar favorite has appeared again as it is failing its 200 DMA. This stock reversed a short-base breakotu in January on huge volume and since has failed to make a new high and has continued to selloff on stronger volume. While the overall stock market indexes appear to be going nowhere, it does look like TNH wants to move lower. Still, it is going to a small position, as volume is low on the failure. Eventually, this whole chemical-fertilizer group will be selling off as all the charts have that same slow-rollover appearance. The market is very tiring right now so unless you are very experience there is no way you should be taking this as a short. Cash remains king as long as this market continues to move sideways. When volume returns and a new trend is established, we will go back to either getting long or short. But for now, it is best to not slowly bleed your account to death via constant and multiple cut losses or by making much bigger mistakes like buying the “bargain” that is SGP. Cramer is still long and I am still short from 1/14/2008. But if you want to know what I look for when I cover my winners then today’s price and volume action is clearly what you should be watching for. I covered another 50% on top of the 30% that has already been covered back in late January and mid February.
new short position: TNH
TNH is failing at the 200 day moving average, before even touching the 50 day moving average, on below average volume. Even though volume is very low on this failure, it is simply too close to the moving averages to not take the short. If I am wrong the cut loss is worth the potential rewards from this stock that just seems to not want to top. I have never seen a stock show so much negative action through the entire 2007 and 2008 and still be moving higher. However, looking at the long-term daily chart it is starting to clearly look like TNH is rolling over as the 50 DMA is nearing a “death cross” of the 200 DMA. Cut your final loss with a close above the 200 DMA, if the stock does not move lower immediately.
