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August 3, 2007


Stock Du Jour (XHB) & Random Observations

Decent, positive bias all day … nothing spectacular but a change from the plunges and see-saws of late.

Notable New Lows: Getty Images (GYI), Rent-a-Center (RCII), and Bare Escentuals (BARE) — deserves to be on the new lows list for “escentuals” alone.

Notable New Highs: Pharmion (PHRM), Nokia (NOK), and Juniper (JNPR).

I’ll feature a weekly chart of the Homebuilders ETF (XHB) … you can see the flush down below $25 … if it closes strong tomorrow (Friday) then it will form a pretty “hammer” as commenter Born2Code points out. Buy above the hammer’s high and set your stop below its low (and cross your fingers — you’ll lose 12% if wrong).

XHB

This entry was posted on Friday, August 3rd, 2007 at 8:48 am (utc+8) and is filed under Trading and Investing.

7 Responses to “Stock Du Jour (XHB) & Random Observations”

  1. Todd said:
    August 3rd, 2007 at 9:31 am

    Knife catchers, anyone?

    Bloody lot that they are …

    P.S. No, my post likely does not signal the bottom in this group. I’m an ordinary schmo just pointing out the obvious.

  2. C. Maoxian said:
    August 3rd, 2007 at 10:28 am

    Todd: Well, yes, it’s clearly a “countertrend” play but long-term investors don’t think like short-term traders. We’ll see what happens, I may risk $500 on it for fun.

  3. Born2Code said:
    August 3rd, 2007 at 11:19 am

    Todd: Successful speculating is not about knowing whether the price of a stock will go up or down. It is all about successful money management.
    You have a well defined entry point and a well defined stop. Figure out how much you want to risk on the position, size it accordingly and then decide if you want to take the trade or not.
    I am fully invested and will not be taking this trade. But if i get stopped out of one/some of my positions i will seriously consider this trade.

  4. Brian said:
    August 3rd, 2007 at 11:02 pm

    All I know is that my charts tell me to stay out of the homebuilders and financials.

  5. C. Maoxian said:
    August 3rd, 2007 at 11:29 pm

    Brian: Charts schmarts. ;-)

  6. Brian said:
    August 4th, 2007 at 4:27 am

    It looks like Barron’s “Where’s The Little Guy?” cover last week was the sell signal this time.

  7. Maoxian » Stock Du Jour (DXD) & Random Observations said:
    August 4th, 2007 at 9:20 am

    […] Whoa, selling from the get-go, went on all day, and really accelerated in the afternoon — not as bad as last Thursday (the 26th) but still looks pretty scary. The homebuilders definitely did not end the week on a positive note and there’s no hammer to get excited about. Looks like Sy Jacobs was right! […]

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