Off your game?
Read our free, updated as of Mar 3, 2022, Dr K report on how to optimize your mind and body so you can boost your focus when trading the markets.
Meet Dr K !
Chris Kacher
  • Nuclear physicist
  • Stock & crypto market wizard
  • Blockchain builder
  • Bestselling author
  • Top 40 charted musician
  • Biohacker
  • Former computer hacker
Your email will always remain private.

MLR - PMP 3/31/14

Major averages rose weakly Friday on lower volume, reversing some of the gains made earlier in the day. Biotechs and internets had been leading groups up until recently when both groups experienced their worst setbacks in more than 2 years. Money has seemed to rotate into energy, commodities, and financials instead of leaving the market outright, but this movement has defensive flavor to it. International stocks and super-cap stocks have also bucked the downtrend as money flows into these sectors, moving away from high-P/E highflyers and into low-P/E, old-line big-cap names. With weakness in high beta leading stocks, money seeks safe haven in what is perceived to be more stable, less volatile areas of the market. Thus the Dow Jones Industrials and S&P 500 are only off a percent or so compared to the NASDAQ Composite and Russell 2000 which are off 4-5%.

The largest concern is that when leading groups get hit hard, that usually has a negative eventual impact on the rest of the market. Thus, in non-QE markets, further downside would be expected. But QE is the wildcard and has provided a floor for the markets since January 2013, so major averages could indeed come off another few percent but then find a QE floor.
Not surprisingly, CANSLIM type stocks have lagged major indices such as the S&P 500 since quantitative easing began in 2009: https://www.northcoastam.com/. This is testament to why markets can change, and why our pocket pivots and buyable gap ups are superior methods, and not just since 2009, but in numerous prior market cycles as well.
Today is the last trading day of the first quarter and futures are up strongly, continuing a pattern that we saw most of last week when the market gapped-up several times only to churn and stall, closing mid-range or below. Most leading stocks are down deep in their patterns after suffering severe selling pressure over the past 2-3 weeks, so a reaction rally is always a possibility. In our view investors should stand clear of the long side until more concrete set-ups present themselves.

Like what you read?
Let us help you make sense of these markets by signing up for our free Market Lab Reports:
This information is provided by MoKa Investors, LLC DBA Virtue of Selfish Investing (VoSI) is issued solely for informational purposes and does not constitute an offer to sell or a solicitation of an offer to buy securities. Information contained herein is based on sources which we believe to be reliable but is not guaranteed by us as being accurate and does not purport to be a complete statement or summary of available data. VoSI reports are intended to alert VoSI members to technical developments in certain securities that may or may not be actionable, only, and are not intended as recommendations. Past performance is not a guarantee, nor is it necessarily indicative, of future results. Opinions expressed herein are statements of our judgment as of the publication date and are subject to change without notice. Entities including but not limited to VoSI, its members, officers, directors, employees, customers, agents, and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. Additional information is available upon written request. This publication is for clients of Virtue of Selfish Investing. Reproduction without written permission is strictly prohibited and will be prosecuted to the full extent of the law. ©2024 MoKa Investors, LLC DBA Virtue of Selfish Investing. All rights reserved.
Copyright ©2024 MoKa Investors, LLC DBA Virtue of Selfish Investing.
All Rights Reserved.
privacy policy