Trying to Trade Signals in a Timely Fashion and Tune Out the Noise

A substantial move down, a substantial move up and now a game of hurry up and wait to see if we just witnessed a major low in several choice longer term buy candidates. Some think the bottom is in, others think the oversold rally has run its course and has already given way to a resumption of the bear trend.

As we discussed last week, its our view that major very tradable and investable lows are in for several names and groups so we will act accordingly and attempt to time entries and accumulation strategies. We continue to think that there are many compelling buy candidates available and think the next big move is not down in the case of several quality stocks we want to own as the pullback with the market in the coming days.

In the coming days, we'll be looking for confirmation that our view is likely to prove true in a few specific names. For increased confidence, we'll look to clues in volatility, relative strength, shorter term trading patterns and changes in volume - signals in the noise which 50 different pundits will try to explain 50 different ways.

In terms of industries, we are looking most closely at oil services, financials, chemicals, hotels and even semiconductors. We have several solid oil service, financial, hotel and chemical names in mind and are doing some work on a couple of semiconductor names we'd like to discuss soon. Interestingly, none of these industries can be bought wholesale as they are frought with risk and filled with companies more likely to disappoint than not. That's where the opportunity comes in: these groups have discounted a fairly dire scenario almost across the board - in some cases we think the discounting is overdone.


For now however, we'll tune out the noise and spend our time kicking more trade/investment candidate tires, and monitoring how our favorite charts and indicators are developing. We are waiting for more opportune entries to present themselves instead of getting are asses whooped my market makers, specialists and Mr. Market. Not to worry, we plan on having something good tomorrow. Tune in tomorrow for a couple of equity and option ideas we think are particularly interesting.

Alpha Timer