Stocks — Page 20

VMware Completes First Run

October 10, 2007 by Chris 2 Comments

VMware (VMW) completed the first stage of a run I anticipated early last month. I said to look for a push towards the triple digit threshold for a $60-$100 run. A run that is common among stocks with strong fundamentals and up-trending technicals (or hot IPO’s – the case here).

According to records, only 4 Mutual Funds bought new stock as of October 1, 2007. They owned a collective 4,800 shares for a value of $395,328. I expect this limited data to explode during the next “full” reporting period. It’s too bad I can’t find real time institutional data as that would be awesome. Only a select few get real time institutional data. For the rest of us: read the price and volume charts!

By the way, the stock has a forward P/E ratio of 162.09x
Is that too high to buy? All I can say is that some thought the price of VMW was too high at $69.

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.

Filed Under: IPO, Stocks

Google Does Everything Right!

October 8, 2007 by Chris 4 Comments

I once asked:
Google – Can they do anything wrong?

I asked this question on October 22, 2004 on my former blog, Market Talk with Piranha, which you can still enjoy online. That was my “blogger” blog while running MSW and before starting chrisperruna.com on wordpress.

It is now three years since that post and I have not owned GOOG for the entire run, not even close to the full up-trend. So, why didn’t I own it the entire time?

I ask myself today what I asked myself then: WHY NOT?

“I love the site, I love the company and I love what I see in the stock, so why don’t I own a piece of it?”

I guess my answer boils down to trying to beat the market with swing trades in speculative stocks. I’ve come to realize that it is more profitable to just stick with a winner over the long term and trade them like a turtle (per the book by Curtis Faith). I need to better weather the draw-downs with trending stocks and ignore the shorter term daily fluctuations. If I could successfully do that, I would have owned both GOOG and AAPL for their entire runs instead of pieces of their profits! SCRAPS when looking back!

Google (GOOG) is now up more than 350% during the three years and crossed $600 per share in intraday trading today. Is it hard to believe that GOOG may reach $1,000 per share before this great run is over? Hell no! Great stocks with increasing earnings go higher. They continue to make higher highs so never be afraid to buy stocks making new highs during bull markets or stocks that have a P/E ratio above the rest of the field. Luxury items demand a premium price!

This was the wisdom in my head three Octobers ago (10/22/04):

Google reported Thursday and missed expectations by $0.11: Earnings were at $0.45 per share, up 25% vs. a year ago. Revenues rose by 105% beating views. Shares were up about 8% in after hours trading.

We can now see how the after hours trading would pan out today. A huge gap up on extremely large volume has sent Google up 16% today. Too bad Google can’t help the rest of the market as it is “dead as a doornail”.

The Google gap up started the day at $170.43 The stock closed the day yesterday at $149.38 Currently at noon, it is holding around $174 (up 16% for the day). What a run since the IPO.
Anyone could have gotten in at $98 to $100, too bad I wasn’t one of them!

I have seen GOOG come up on my preliminary screens but I was holding off until they reported earnings and formed a pattern I was comfortable with.

Back to Google, I love the site, I love the company and I love what I see in the stock, so why don’t I own a piece of it?
Listen to me Google, set up a solid base and allow me to ride the next wave!

I did ride that wave but I jumped off too soon!

Filed Under: Blogs, Stocks

Solar Super Stars

October 1, 2007 by Chris 6 Comments

I highlighted a group of solar sister stocks on September 11, 2007 during a typical daily screen. Many analysts and stock bloggers, such as Madstocks, have been doing the same since this is the hot trending group. You have two choices: Join the party or watch it happen!

All seven solar stocks (SPWR, FDG, YGE, JASO, ANR, FSLR, LDK) have moved higher with my original Chinese solar buy, JASO, leading the charge over the longer term. JA Solar Holdings (JASO) peaked with a 90% gain in three months and is now up more than 85% since my June coverage.

More recently, First Solar Inc. (FSLR) has blasted higher, reaching new highs with a 26% gain over the past three weeks. I highlighted it on the 9/11 Daily Screen and had this to say:

FSLR – 100.42, the stock is consolidating after the super run from $20 to $119 over the past nine months. FSLR is related to LDK in this category.

LDK Solar Co. (LDK) had a peak gain of 40% during the month of September and has been making new highs since its debut for four consecutive months. Here’s what I had to say a few weeks back:

LDK – 58.13, the stock is past all ideal entry points but is one to keep any eye on based on the excellent up-trending strength. The ideal entry would be a pullback to the 50-d m.a. A shorter term entry could be on a slight pullback near $50. This is one to watch for a future $60-$100 run.

The group is moving higher and I am no longer an entry level buyer into these sister stocks. You could add shares on pullbacks but I won’t be joining. I own what I need to own and will only take profits when necessary. Ride the trend. If you missed it, wait for the next train to arrive.

I’ll update and cover the China trend tomorrow, along with a fresh daily screen!

[Read more…]

Filed Under: China, Stocks

Trader Vic 1-2-3 Setup?

September 27, 2007 by Chris 5 Comments

Clean Harbors (CLHB) looks to be setting up a 1-2-3 pattern as described in the book Methods of a Wall Street Master by Victor Sperandeo.

As you can see:

CLHB broke the up-trend after establishing a new 52-week high.
From there, it consolidated and formed what is referred to as the minor sell-off.
Prices stared to rise but failed to make another new high. This test of the previous high failed near point number 2.
A failure to make a new high is usually (not always) a signal that the trend is about to change.
Finally, we reach point number 3 where prices went below the previous short term minor sell-off

However, prices didn’t continue to fall below this area so the position would still be established from the original penetration point. New investors should be looking for another penetration of the prior minor sell-off.

In addition to the 1-2-3 setup, the stock has also allowed it’s 10-week moving average to cross below the 30-week moving average which typically signals a change in trend when both lines are starting to point down.

Potential Trade Set-up:
Ideal Entry (short position): $45.00 (right now below the moving averages)
Risk is set at 1.0% maximum of total portfolio or $1,000 of $100k
Stop Loss is 6% or $47.70 (above moving averages)
Number of Shares: 370
Position Size is $16,650
Risk is $2.70
Target is $40 or less
Reward-to-Risk is about 2-to-1 (the target is a guess but I prefer at least a 3-to-1)

Victor Sperandeo says this about the 1-2-3 setup:

At the point where all three of these events have occurred graphically, there exists the equivalent of a Dow Theory confirmation of a trend change. Either of the first two conditions alone is evidence of a probable change in trend. Two out of three increases the probability of a change in trend. And three out of three defines a change in trend.

Take a look at the picture I scanned from Sperandeo’s book on page 76:

So, I’ll take the trade and see what happens. It can go up and whipsaw me out of the position but I have my stop and risk established so it won’t hurt the overall portfolio.

This is a game of odds with developed expectancies so take the trades and follow the rules.

Filed Under: Books, Stocks, Technical Analysis