At the close, the SP 600 and SP 400 led the way with a .2% gain, the DJIA rose .1%, the SP 500 and NYSE closed slightly below the flat line, and the Nasdaq was lower by .2%. Leading stocks continued to keep pace and outperformed the broad market today, with the IBD 100 and IBD New America indexes rising .3%.

Volume was much lower on the Nasdaq-which is exactly what you want to see right after a follow-through. But to be honest more price gains immediately is always prefered. The NYSE volume came in slightly below yesterday’s level. As you can assume, the advance and decliners were basically even on both the NYSE and the Nasdaq, with a slight positive bias. The positive breadth is nice to see when the indexes were slightly down. But there was more volume on the down stocks so I guess you can call it a wash. There were 366 new highs to only 35 new lows. The put/call ratio, despite the rallying market is still at 1. Traders are still betting against this market.

Which is basically how you could call today’s trading. Except oil stocks. The Amex Oil index rallied 1.7%, topping all the other sector indexes out there. Oil sectors made up 8 out of the top 10 IBD industry group list and 75% of the Oil & Gas- US integrated stocks made new 52 week highs. The other top two groups in the top ten was the Food-Dairy Products group and the Mining-Gems group. These groups don’t necessarily have the excitement and innovative products that is normally associated with strong bull markets.

So basically we still are not seeing anything new from new leading industry groups and simply have a resumption of the uptrend from the October 2002 lows. Today and yesterday was nice but we still have very few stocks shaping up beautiful green bases. Today, I had 10 new longs show up, for me to take. However, only two are worth any real investment. And both of those have iffy patterns. RVSN is a little too extended to be a completely safe buy with a small cut loss (high reward/low risk ratio) and LHCG is just overall an uptrending stock that still has a lot of violent reversals before resuming the trend. However, if you watch RVSN, you can probably pick it up for a better price on a low volume pullback. But until I can find stocks that are more green and have less red on my charts, I still am staying cautious with the new longs I take. We still have a lot of crap and not a lot of quality.

When you don’t get any severe pullbacks or long-term sideways trading in the stock market, this is what happens (low VIX = less money to be made). We need a big pullback to get volatility back in this market. With VIX up near 20, even then there will be a lot more stocks making 100% plus moves in short time frames. A VIX at 30 and you will fall in love with this strategy. A VIX at 10, like now, is just not going to produce a lot of great longs that make HUGE gains. That is just the way it works. There is nothing I can change about it. I hate it and you hate it, trust me. We need more volatility!

However, like I have been saying for some time now, if you can daytrade and you understand how to buy not only breakouts but how to manage buying stocks at support and selling at resistance, I suggest to keep playing that game. Solar stocks are making the VERY FEW good daytraders that I know quite wealthy. Holding (not daytrading) ASTI for instance has given you a 100% gain the past 10 days. Why don’t I daytrade these and make a killing? Good question. The truth is: I hate daytrading. I don’t like being glued to the monitor and making quick buys without having time to review the situation. But I am sure if I wasn’t so lazy and would daytrade the solar stocks, I am sure I would be doing OK. Not great; but OK. I have played that game before. It is not like it would be a new adventure.

No top ranked stocks fell on heavy volume today in the IBD 100. And out of 174 longs, I had zero complete sales and only two partial sales. One of the partial sales was OEH. OEH is starting a climax run on the short-term/intermediate time frame. So, the reality is, out of 174 stocks, only one was sold because it needed to be sold. But to be honest even that sale was very small as I pretty much nailed that top. Do a search on the forums, to see for yourself. Overall, a very strong day, despite the flat close by the indexes.

Don’t fight this trend. I know it sucks that the market did not give us a real pullback to help us set up a ton of new charts in new longs that will launch a great bull market. But we have to take what we can get. What we are getting is higher stock prices. This is another reason why it is NEVER smart to panic sell. Just think of all the longs you sold off completely that are now higher. I made a sell decisions on Feb 27 and shortly after based on the chart. NOTHING else came into play, except the fact that the market was selling off so you have to sell some breakdowns that you might not sell in a bullish tape.

This low VIX rally, unfortunately, seals the fate of the market. This low VIX will not offer us many big winners. Like I keep saying, the August 2006 rally was the worst rally I have ever been a part of. The reason is simple: a low VIX. After big bear markets a high VIX ensures many 100%-1000% winners can be captured. A constant low VIX will just help us keep afloat. This is not the market to be going all-in on yet.

I had a very busy day today, with medical appointments and mandatory shopping trips with the wonderful love of my life. Aloha and I will see you in the chat room!

At the close, for the indexes, the Nasdaq led to the downside with a .4% loss, the SP 600 and SP 500 fell .3%, and the DJIA fell .2%. Bad news again came from leading stocks as they, once again, led to the downside, with the IBD 100 falling .6%. Leading stocks like CHDX and BMC got crushed.

Volume was much lower on the NYSE and the Nasdaq. The lower volume helped the indexes avoid another distribution day. And with the Nasdaq finding support at the 50 dma, the low volume pullback is actually very comforting considering that the selling could have followed-through from Friday. Breadth was negative on both exchanges, with decliners beating advancers by a 3-to-2 margin.

It was a steady day of light volume selling that came with a late day minor bounce that managed to take the indexes off their lows. The last hour bounce helped the Nasdaq find support at the 50 dma, which is a positive in a short-term market with more negatives. This action today continues the trend from Friday of the selloffs not finding the buyers like they were previously in this uptrend. And that has to be in part due to the overbought conditions the market is in. Even though the market is holding the 50 dma, unless more volume comes into the market on the upside and dips are supported, I doubt it will for much longer. However, until it actually falls below the 50 dma, it is just preparation-speculation.

Once again, today, I had a lot more stocks to completely and partially sell-off than I had new purchases. This continues a constant trend. Along with action, I am finding few new longs of quality even setting up. The new longs, recently, have all been of the speculative quality. Sure some have Featured qualities, but some qualities is not the same as a perfect Featured long. That is where EPS, sales, and the chart are all going in the same direction–up. Also I am keeping the buys of these new speculative longs small and will continue to raise cash to have on hand incase better stocks show up.

I have a lot of big winners giving clear sell signals and with so many winners giving those signals I really don’t want to be going all-in on any new longs. I like to go all-in when stocks are breaking out left and right, after a market has given a FRESH follow-through day from a long downtrend. Right now, after a four-year bull run, going all-in on new longs seems silly. It is best to wait to buy great stocks from beautiful patterns after the market gives us a pullback. Bottom line: Just be careful here. Don’t get cocky and think that a bounce is definitely going to happen. Things have obviously changed and you must realize that those are the facts.

There is a truckload of economic data this week. Retail sales, Manufacturing numbers, Housing numbers, and Producer prices are the important numbers on tap. Ben Bernanke is also going to be giving testimony before Congress and that always has the possibility to move the market. Whatever happens, I will be on it; I am always prepared. No matter what happens I will know what to do and will let you know what to do. If you are a gold subscriber you can go to the “complete sells and stocks on watchlist” and see exactly what I am selling. By correlating that to your charts, you should be able to soon see why I take profits where I do. If you read the past five “daily market analysis” in a row, you will know exactly the game plan I am looking at for this market environment.

Aloha and I will see you in the chat room!!

At the close, the SP 600 led to the upside with a .9% gain, the DJIA and Nasdaq followed with .5% gains, and the SP 500 rallied .4%. The SP 600 and Nasdaq both bounced off their 50 day moving averages.

Volume was lower by over 20% on the NYSE and the Nasdaq as many players with a lot of money are on vacation for the whole week. Do not expect volume to come anywhere close to the 50 day volume average this week.

Breadth was very good with advancers beating decliners, on both the NYSE and the Nasdaq, by a 2-to-1 margin.

One of the best groups of the day came in the Airlines sector. The IBD Transportation-Airline group rallied 1.4% today and the AMEX Airline index rallied 2.3%. Some leaders in this sector include LFL, UAUA, CPA, RYAAY, and LCC. Funny thing is, I am long 4 out of 5 of those names. You always want to have your money in the leaders. Not the laggards.

The other standouts on today’s charts is in the China stocks. My only new long was a China stock and gains in other stocks like CHL, ACH, LFL, and many others show China is where the spotlight is still at.

The laggards on the session was the Retail stocks. The IBD Retail-Clothing group fell 1.2% and the RLX fell .3%. Overall, you can’t call that too much damage. But it is where the pocket of weakness was today.

Today was the day after Christmas and a post-Holiday rally should have been expected. This market is supposed to have upside momentum for the rest of the week, since there are not a lot of sellers and it may be easy to bid up some cheap stocks. But a pullback continuation on the indexes would be much better as the low volume would make it a perfect low-volume pullback. Then the volume can come back in after New Year’s day and the market can breakout on volume higher than what came on the downtrend.

There is nothing new to add to the commentary that I have not hit upon already in the past five post. This week is going to be slow, drift-less, and should have an upside bias. I am going to play long setups the same way I always play them. Just because it is a low volume environment doesn’t mean that if a stock violates a cut loss point that you do not cut your loss. And if a stock breaks out from a nice consolidation pattern on heavy volume, you treat it the same way. Nothing is going to change.

Happy Boxing Day to everyone that celebrates it and Happy Kwanzaa also. Aloha and I will see you at Investors Paradise.

This is the last week for free market commentary, longs, and shorts. Starting January 1st, this blog is done.

New Swing Long: SNDA

Adding To Current Holdings: GRRF CLRT

New Swing Shorts: NONE

Longs Up On The Day (low vol non-IBD excluded): FTEK-44 DECK-27 IHS-95 IIVI-31 STEC-84 TYL-51 AOB-102 ICE-40 HMSY-34 HRT-27 TTEC-63 SEIC-25 DA-52 OMTR-77 GRRF JSDA BTJ AMSF IIG ININ SRSL UAUA LFL GLDN TSRA IWOV VEH RKT RBN IFOX MVSN CACB CTCM CMCSA HEI NU CNH LCC WTS CVLT ASCA LRCX OTEX SMOD EVEP CCO JCG VCLK INAP TMO BMC CELG MAIL ISLN OSIR BMTI CLRT BITI ECMV ISBC BPHX INMD

Stocks On Radar Screen: CHL ICON GSOL FCFS SBGI NCTY CBG MIDD SPI TELN MOCO MVE WEL KKD CBRX USEY

Partial Sells: AW KOG CAM OMNI CKSW ILC TATTF DIVX NMGC

Complete Sells: AFT MFG

At the close, the DJIA and the Nasdaq fell .6%, the SP 500 fell .5%, and the SP 600 fell .4%. The good news is small caps did not lead to the downside this time. The bad news is leading stocks, measured by the IBD 85-85 index led to the downside with a .8% loss.

The wonderful Christmas holiday news was that volume came in well below yesterday’s levels and was well under the 50 day volume average. This is just what you want to see on a pullback. Volume keeps coming in lower every day the averages pullback. PREFECT!

Breadth was negative on the NYSE by a 5-to-3 margin and negative on the Nasdaq by an 8-to-7 margin

Oil stocks were among the worst of the session. The Amex Oil Index fell 1.2%, and the Philadelphia Oil Service Sector Index eased 0.6%. The Nasdaq Telecom Index slipped 1.3%.

For the week, the Nasdaq led to the downside with a 2.3% loss, the SP 600 fell 1.5%, the SP 500 dropped 1.1%, and the DJIA managed only a .8% loss. Overall, it was a bad weak, just by looking at the numbers. However, when volume is included, it was the perfect pullback. It is very nice to see this selling come on very low volume. It would be MUCH worse if volume was rising. But it isn’t.

The Nasdaq is now at its 50 dma, joining the SP 600 at this critical line. It will be important to see how the indexes shape up here in the coming weeks. Strong selling through this line will be bearish. However, if the indexes either drift around here on low volume or blast off the lines on strong volume, it will be bullish for the markets.

The Nasdaq currently is at the bottom of its trading range and has not broken down so jumping to the bear side is not a smart decision yet. The longer-term trend is still up on both the Nasdaq and SP 600 so the smart play is to remain focused on the long side. Until the trend changes, you have no reason to.

It is going to be a light volume week ahead. There will be many small stocks that should produce some nice gains in this kind of trading environment. At the same time, during this time, if you have any stocks that selloff on heavy volume you might want to consider getting rid of them. A lot of small caps run a ton during this kind of trading. However, if you are long a bunch of junk and they don’t move and instead go down, you should get rid of them.

Hopefully, the market will keep pulling back all next week. That would create a beautiful basing pattern for a possible upside breakout for the indexes. Low volume pullbacks are about as good as it gets after such a strong run up as we have had in the indexes.

Even though it doesn’t seem like the Christmas spirit is in the air on Wall Street, it is to me. I love low volume pullbacks during the holidays. More often than not, a low volume rally over the holiday periods leads to selling. Low volume pullbacks then lead to higher volume rallies. This is my perfect Christmas scenario right now. This is what I wanted and this is what I am getting, so far.

The big money will not be playing this week, so expect little changes in the markets.

Aloha, Mele Kalikimaka and Hau’oli Makahiki Hou!

I will see you at Investors Paradise.

New Swing Longs: NONE

Adding To Longs: NONE

New Swing Shorts: NONE

**number is % gain since long taken. Only stocks up 25% have numbers**

Longs Up On The Day (low vol non-IBD excluded): PTT-109 AOB-99 STEC-82 MA-94 FFH-27 PCCC-35 APLX-29 PSPT-32 TTEC-62 JSDA BLUD INAP MAIL HEI CCO FMCN EVEP IMKTA IFOX IWOV AMOT CTCM DECK GIFI PCC SKX NHWK VEH AB CVLT AMSF CACB IMA DLB WTS IPHS IMMU TZIX SEAC HAUP AFT

Stocks On Radar Screen: ATNI EMCI MOCO CALM TAST ITMN ISPH DAR PRKR TLEO STKR IDN SAB

The Important Partial Profits/Losses: RTSX ONT HOTJ SRSL

Completely Take All Profits/Losses: GSL TDY

At the close, the DJIA led the way to the upside with a .2% gain, the SP 500 and Nasdaq closed .1% higher, and the SP 600, once again, diverged closing lower by .2%. The IBD 100 did not lead but it did not lag either. Instead it kept pace with the SP 500 and the Nasdaq, closing .1% higher.

Volume was much higher on both exchanges as quadruple witching contributed to the HUGE spike in volume. Trading for the last day were stock index futures, stock index options, stock options and single stock futures. These days, like always, are hard to analyze on an accumulation/distribution basis. However, on days where the market does nothing like today, it doesn’t matter.

Breadth was negative on both exchanges, diverging from price, with decliners over advancers by a 6-to-5 margin on the NYSE and by a 8-to-7 margin on the Nasdaq.

The biggest movers of the day came in the form of Gold stocks which got hit pretty hard. This is normal, for old leaders. They come back from the dead after the “real” run and then everyone thinks that this run will be as good as the last one. Sadly, there normal is never another run. The AMEX Gold Bugs dropping 1.5% and the Philly Gold & Silv Index losing 1.4% show the true intnetion of the big boys. They are selling these stocks and some of the “true” leaders like GG on a weekly show the same patterns EVERY old leader shows. Goodnight gold.

For the week the SP 500 led the way with a 1.2% gain, the DJIA followed with a 1.1% gain, the Nasdaq followed with a .8% gain, and the SP 600 lagged with a .2% loss. Leading stocks, in the form of the IBD 100, rallied .5%. This is the first time in a while I don’t remember this index leading. However, the fact that the SP 600 is lagging so bad and the IBD 100 is still keeping up keeps me positive.

Overall it was a pretty darn good week, considering all the positioning I had to do in my portfolio. I took a lot of gains/small losses this week on over 150 different stocks. But despite all this moving around in my portfolio, my account did pretty darn well. I know one thing, had I not taken profits and cut some laggards I would not have ended the week with gains. Discipline always works better than hope.

Today was not a big deal, unless you consider another all-time high by the DJIA and six year highs in the SP 500 to be news. For me, there is nothing of importance with this, besides the fact that it just confirms that this market and economy is currently still very strong–sorry bears, facts say you are wrong AGAIN.

We are starting to enter that time of the year where traders start taking vacations and get prepared for the upcoming Holidays. Normally this means stocks drift to the upside. Last year that did not happen. In 2004 we drifted up on low volume only to break really hard in January. Nobody knows what will happen this year but be cautious of a low volume drift higher. They have a good track record of ending badly.

However, with a backdrop of the PPI, the personal income report, the spending report, the LEI, and 3Q GDP, lower prices would not surprise me. I wouldn’t mind them to be honest. The gains this week on the Nasdaq and SP 500 did come on heavier volume and since the last couple of trading weeks are on lower volume a low volume pullback would be welcomed here.

I hope you are having a great weekend and I will see you at Investors Paradise.

New Swing Longs: CACB GMRK VPFG MFG FSLR ISSC

Adding To Longs: NHWK BOBJ PFWD

New Swing Shorts: NONE

**stocks up 25% or more have % gain listed since long position taken**

Longs Up On The Day: JST-131 HMSY-40 INWK-55 CXW-37 IHS-95 ICE-41 STEC-73 IAAC-49 BMA-34 PCCC-37 SVNT-89 SEIC-26 TYL-54 CPA-55 OMTR-79 MA-95 MAMA-83 UAHC-25 SOFO-98 PERY-35 MALL-36 GENT-42 GRRF SRSL NITE JCG ISE FMCN BOT CELG RENT NHWK OTEX TSRA RKT SKX DECK TATTF SQM EVEP LFL TMO BLUD HOS INAP CCO LRCX OPTM NLST OSIR EFUT ULTR EXLS CBF GSIC FTGX NMGC ADBE BOBJ MFB PFWD MDF OPLK BITI OEH WOLF AZK AEZ AYE NWL ACGL AGR NHP MCRS CCBL HURN HNZ CMCSA RAH HCSG PNW BMRN EOC INMD PRCP

Stocks On Radar Screen: GMKT PKTR WFD CRK XTXI NTGR DIGE BRG KSW HTZ IPHS GOLF ENTU SWKS DAR GILT CLWT CBRX DSCM ADL CTCI HTI GE FLIR PBH PHLY NUVA LYTS MAT EMC CTC TLEO MEL VRSN NAVI TMI TPK FRGB WBKC

Selling Some Of My Holdings: LCC IGT BONT CVO ASCA CRT MOS AZS PRFT TSYS MBLX ACHN

Completely Selling My Holdings: TSEM MSTR ROG VOCS SMSC LMRA AXTI