Rick’s Picks

Thursday, February 17, 2005

For investors who’d rather be smart than lucky 

A tough market to trade, for sure.  Perhaps I should have been more careful about what I wished for? A while back, I asked The Rainmaker to give me just a little movement in the S&P futures and maybe the barest hint of a trend -- that would be enough, I thought. How was I to know that the E-mini contract would tighten down to a daily range of five points or so, presumably winding down to Mr. Market’s equivalent of zero degrees Kelvin? The process is threatening to change the trader’s very notion of what constitutes “a little movement.” Another few weeks of such price vibrations and even scalpers who pay just a dime per round turn are going to start throwing in the towel.

Not that we’re being overly picky about opportunities. Hell, we even made a play for Beazer yesterday – on the long side, no less! – only to have the stock bottom a measly 20 cents from our bid. That was at the bottom of a $4.20 swoon, one that followed a classically sneaky bull trap on the opening. We have a right to feel good about not getting sandbagged at the top like so many others evidently did. But feeling good – even about having survived -- is not exactly money in the bank, is it?  Oh well. We’ll give it our best shot again today when the market opens. But even if it should slow down still more, boredom will never, ever determine our choices.

Granville’s Sell Signal

For those who view the stock market’s apnea as a sign that something BIG may be about to happen, there is this reed to lean on from our friend Phil (the guy who nailed the recent low in silver so nicely).  He writes as follows: “It looks like today the market will give an Old Fashion "Joe Granville" sell signal. [Editor’s note: It narrowly missed.] Back in the early 1980s  I used to surprise my stock broker and his colleague by accurately calling market tops that Joe Granville would predict. It wasn't difficult because Joe pretty much explained in his newsletter what he looked for -- so it was easy to make the call when the market met the necessary criteria. Today, if the Dow Industrials close around 10,855 or higher, which is above the closing high of late December, and the NASDAQ COMP and S&P don't close above their respective closing highs from late December, the market would give a sell signal.  

We’ll keep an eye on this one, Phil. But given the market’s inertia of late, we won’t hold our breath.

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Penny Pinching

Grappling with the trend? Check out Rick’s Picks’ archives to see how well Rick Ackerman has done with his forecasts and trading strategies. Last week, tradable lows for oil futures and two gold stocks that had been predicted as far back as October were reached to the penny.

Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2005, Rick Ackerman. All Rights Reserved. www.rickackerman.com