I don’t like spec plays heading into a conference call but I am playing VMW on the long side today, using options. I did buy distant puts to lower the risk so I guess I have a funky long straddle set to go. Let’s see what happens.

VMware, Inc. Earnings Conference Call (Q3 2007)
Scheduled to start Wed, Oct 24, 2007, 5:00 pm Eastern

VMware Completes First Run

Don’t guess when a trend is over, allow the market to show you when it is over!

Keep Riding the IPOs

VMW – 107.04, the stock completed the $60-$100 run and is now above the triple digit threshold. I am looking for a base at or slightly above $100 for a new entry (to add shares). If it doesn’t base, I will ride my original position.

Daily Screen for Friday 9-7-07

VMW – 69.79, it’s the first time I am covering the stock as it is yet to build any recognizable base. However, the support and hype is still there so be ready to pounce on pullbacks and look for a ride towards the triple digit threshold ($100). An unusual $60-$100 run.

Daily Screen for Tuesday 9-11-07

VMW – 76.76, the stock was up 10.45% on one of the largest daily volume days since its debut. Today’s move shot the stock into new all-time high territory. The stock is up 20% over the past four days.

Watch the action among these leaders to truly gauge where the market is headed. Step back and view their long term charts so you don’t get caught up in the day to day MINOR movements!

Seriously, step back and throw the charts on the floor or hang them on a wall across the room and you will clearly see the trends. These stocks have been leading the market higher and will give the FIRST clues of a market looking to go lower! We did have our second major distribution day last Friday and fourth overall but these stocks will tell the ultimate story!

The major Superstars include AAPL, GOOG, PTR & MDR
The minor or more recent Superstars include BIDU, FSLR, GRMN, EDU and others on the blog. See my stocks category to find the leaders of 2007.

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We witnessed our second major distribution day as the DOW was down 2.6% on volume 40% larger than the prior trading day. The NASDAQ was down 2.6% on volume 15% larger than Thursday.

It was the worst selloff for the NASDAQ since February and the largest for the DOW since August. Volume surged across all major indexes but do keep in mind that it was options expiration day.

Technically speaking, we now have 4 distribution days for the NASDAQ and 3 for the DOW over the past month. It’s now time to start focusing big-time on the market leaders to see where they are going to take this market. If they start to roll over, you better be quick to take profits and even quicker to take losses.

Here’s what I had to say last Thursday, October 11, 2007 (see the charts in this link as well: Distribution Day)

The number of stocks above their 50-day moving averages crossed above the overbought level of 80 last week and we saw our first major sell-off distribution day yesterday. This doesn’t mean you must rush today to sell all of your holdings but do understand that the next sell-off is not far from happening. Study the chart below and follow the purple line to see where and when the market had peaks and valleys as related to the number of stocks on the S&P 500 above or below their respective 50-day moving averages.

The markets flashed a heavy distribution day Thursday as the NASDAQ was down 1.4% on volume 60% larger than the previous day. This was the largest showing of volume in two months and is not healthy because it was pure distribution. It was only the second distribution day over the past month so we can’t call this a bear run but please be on the lookout for a possible correction of 5%-10%. Technology stocks led the decline as BIDU gave back 10% of its amazing run.

Frugal Trader from Million Dollar Journey (Subscribe to the Feed) has been writing an excellent education blog on personal finance and investing. He has been detailing strategies that he employees and explains what has helped him get to where he is today. Below are three of his recent posts that I recommend you take a look at:

• Preparing for a Move
• What is your money lending rule?
• Canadian Discount Brokerage Comparison

Blain from Stock Trading To Go (Subscribe to the Feed) has been writing about stock market education by highlighting his thoughts, lessons and even his success running his own blog. Below are three highlighted posts from the past week. Take a look as both of these blogs offer something great to all:

• 13 Questions That Will Boost Your Investment Portfolio
• 12 Ways to Compare Your Online Stock Broker
• 13 Great Ways to Invest in Oil Without Buying Barrels

I was early in September by trying to locate a climax run in PTR in this post:
Petrochina (PTR) Climax Top?

However, the HUGE volume on the latest push to new highs clearly indicates something is going on.

As I mentioned in the last post, a climax top is where the stock has advanced for many months and suddenly races up for one or two weeks much faster than any prior one-or two-week period or since the beginning of the stock’s long move up.

And the stock does this on the largest volume of the run (something that didn’t qualify in my September post at $181). PTR finally has the extreme run with large amounts of accompanying volume. I do advise selling into this incredible strength, especially since Warren Buffett has sold most if not all of his holdings in Petrochina as documented in the SEC filings.