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Great Gains So Far For This Week

I’ve been busy this week with many things, so keeping an eye on the stock market hasn’t been easy for me. Well this afternoon I’ve had the time to see the progress for the past few days and I’m amazed at the gains that have been made this week by the major indicies.
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I told you in a recent post that I jumped out of basically everything until the markets correct themselves again. We’ve had too much of a run up and I’m skeptical. Looking back on the past few days that I missed, I noticed that there were good opportunities to make money on stocks that I sold and they went on a roller coaster ride afterward.
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The one I want to talk about is Agnico-Eagle Mines Ltd. (NYSE:AEM), a stock that was as high as $62 only five weeks ago. I made the right choice to sell off my position. After it corrected by 10% I bought a small position back. I let it just sit there not bothering to pick up more as it continued to drop. Unknown to me, I wasn’t paying attention to what the stock did this week as it dropped down to below $47.50. If I was aware of the situation, I would have back the truck up so fast to grab shares at that price. That was Monday morning and now the price per share is $55 (as of 3:45pm). A 16% gain in just three trading days.
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In all the times that I’ve traded AEM, I’ve always made money. This would have been great to profit from, but I’m not going to drive myself crazy because I didn’t get into this play. There will always be more opportunities to make money, but if you want to stay sane while trading stocks, you can’t sit there and think of the “what if’s”.
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Agnico Eagle has been trading within a range of $45 to $60 (which is a nice swing gap) this entire calendar year. When the price drops below $50 I buy quite a bit, as it goes above $55 I prepare to sell. This week was a good opportunity to do exactly that and I’m OK with the fact that I missed it.
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Try to keep that in mind as you go through your portfolio.

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Research In Motion (NASDAQ:RIMM)

Yesterday I spoke about building a position in Research In Motion (NASDAQ:RIMM). My first buy-in was at $76.25 when the price dropped. Share price opened this morning at $77.86 and within the first five minutes of trading, it was up to $78.40. Unfortunately that was as high as it would go. Minutes later it fell to $76.13, where it would continue to bounce within that range.

Research In Motion was scheduled to release their first quarter earnings report after the closing bell today. I was looking for some more upward motion from other traders getting on board in expectation of RIMM beating the street.

Shortly after the bell, RIMM released their report. RIMM earned $1.12 per share for the first quarter on revenue of $3.42 billion, compared with $482.5 million or 84 cents on revenue of $2.24 billion a year earlier. Included in the results were non-recurring items. $96.4 million relating to certain employee tax liabilities along with a gain of 175.1 million primarily as a result of the enactment of functional currency tax rules. While the analysts were only expecting $0.94 on revenue of $3.43 billion, RIMM earned $0.98 per share.

What I didn’t expect was after the company beating expectation by $0.04, the stock dropped more than 6% in after market trading. By the time after hour trading was done, the stock moved back up to $76.06, just off by 0.5% from where it closed at 4:00pm today.

One thing that I wish I was able to do was to buy more shares when it fell to $73 shortly after the release. In April, Rimm beat expectation by 7% and since then the stock price has moved up 55%. Today they beat it by more than 4% and it moved no where today. Many investors and traders were looking for more and the knee-jerk reaction was to sell. The more they were looking for was in RIMM’s second quarter guidance. RIMM”S range for earning in the next quarter is $0.94 to $1.03 per share on revenue of $3.45-$3.70 billion. The mean analyst estimate is for 97 cents on revenue of $3.61 billion. After the conference call, I guess people realized it wasn’t as bad as it originally sounded.

With the information I have on this company, I believe that RIMM is still fundamentlly sound and will continue to grow. I will continue to buy into RIMM under $80, after that I will sit back and watch the gains from this great company with a fantastic product. The BlackBerry is a great smartphone with many different applications to do the things you want to do. As a matter of fact RIMM just released their latest BlackBerry model, the Tour, earlier this week.

Jim Cramer doesn’t call this company one of the four horseman of the tech sector for nothing.

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Another Day In The Stock Market

With the economy the way it is right now along with the volatility in the stock market, If you have the ability to trade stocks on a daily basis (day trader) or even holding for a day or so, you can make some money without really trying.
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You will still have to do your homework and research on the companies that you want to invest in, but if you have a list of stocks that you’re very familiar with, playing the volatility is quite profitable.
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Yesterday I spoke about building position in the companies that you want to invest in. When the markets were at their lows, I started to do so. I actually picked up some at good prices, even though I would have like them to come down some more. I told you in the past to buy in increments, not all at once. If the price did continue to fall yesterday, I would have bought more later on.
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I bought Apple (NASDAQ:AAPL) @ $134.75, Joy Global (NASDAQ:JOYG) @ $34, Research In Motion (NASDAQ:RIMM) @ $76.25 and last, but not least, Sirius Satellite Radio (NASDAQ:SIRI) @ $0.325. I expected prices to bounce back up yesterday as well as a little bit more of a gain today. I was right only three of the four trades I did. This morning I waited for the opening to see what I was going to sell. At the opening bell, Sirius was up to $0.43 per share and after the negative news about their downgrade, I expected it to drop down below $0.40. I put in a limit sell order for $0.425 and it sold shortly afterward. A gain of 30% over night. To be honest I was planning to hold on the Sirius for the long term (until their next earnings report ), but when I was up that much, I sold it and will continue on the next dip.
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As for Apple, I was also able to sell my shares at $138, for a gain of 2.5%. I know that isn’t much to boast about, but if you think that you can’t even get that on a basic 12 month CD these days. Take into consideration that I did buy large amounts of share that help offset the fees that were charged to me. Joy Global was the last on I sold this morning. I sold it at $36.50 per share, for another gain of 7.3%.
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As for RIMM, I didn’t get the action I wanted, but that’s OK since I do expect that to run into the $100 range in the coming months. I will continue to hold on to the share and add to my position.
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You need to take advantage of the opportunities when they present themselves, so if you are able to trade on a daily basis, good luck.

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The Stock Market Is Getting Ready For Another Run ...

Here we are again going through another correction in the markets. The three indicies have dropped over the past week off their seven month high and I’m not surprised. Over the last three months the markets have been on a tear coming off their lows. I mentioned before about how the markets wouldn’t be able to continue these gains without some sort of correction and profit taking.
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Even though I’ve been waiting for this pull back for some time, I did expect it. I will say that the markets aren’t as weak as I thought. I no longer expect to see the DOW reach 7000 again. As a matter of fact I don’t think it will get below 7800.
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The word on the street is that there is a large amount of money sitting on the sidelines waiting to jump back in, which means that once investors and traders feel that the waters a safe enough to come back in, it will help the markets rebound even more. Yesterday I heard that many of the hedge fund managers are already invested in and that they don’t have much capital not isn’t in the markets. The report stated that they are concerned that they may miss the next surge in the markets and they don’t want to be caught sitting it out.
If that’s the case, it can also be said that if they get skittish and pull their money out to avoid another big loss, we will see the 7800 level on the DOW.
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I don’t think so on the latter issue because the housing market is showing signs of stabilization, as well as the financial sector. Jim Cramer last night even had a segment in regards to the housing bottom. Since last August he has been saying that the housing bottom would be around June 30th of this year. Well, he ripped the board down and said that after yesterday’s housing number were the third straight month that they have improved. Other indicators are looking good too.
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With that in mind, I will start building positions in the stocks that I’ve been watching for sometime. Over the next two weeks, I will be looking at Apple, JP Morgan, Research In Motion and Agnico Eagle Mines. Of course there are others that I do like, but I would want more of a pull back before jumping on board with them.
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If you’re looking to take advantage of some free advice from Jim Cramer (besides his TV show), Check out his Action Alerts program that he’s always mentioning on his show. I’ve been a member for over a year and find some sound information from him, along with some great picks. Follow the link for a two week free trial of his Action Alerts subscription.
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TheStreet.com 120x120 Free Trial

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Take Advantage Of The Stock Market

I’ve been trading in the stock market for years now. Over those years I’ve learned to take advantage of opportunities when they’re presented to me. One of the biggest opportunities to be offered is when the stock market drops quite a few percentage points in one day or over a period of a week.
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Yesterday’s decline was one of those days to take advantage of, especially in the basic material sector. The sector has moved up majorly over the last two to three months. In some cases like Freeport McMoran (NYSE:FCX) and Allegheny Technologies (NYSE:ATI), they’re up 83% and 130% since their March lows. So when days like yesterday happen and most investor and traders are taking profits, you need to be ready to jump in to buy.
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Wednesday was clearly a profit-taking day. Of course the media was stating that it was because of the bad ADP Employment change report that came out, I beg to differ. Employment reports are always lousy near the end of a recession and during the turn-around period of the economy.
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So late yesterday afternoon I took advantage of some good buying opportunities. The first trade I made was to buy Agnico Eagle Mines (NYSE:AEM). After it was up to $64 in the last week, it took a dive yesterday to the low $58 range, where I decided to pick up some shares. At the time of writing this post, It has moved to $61.25. A gain of over 5% overnight.
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This is why you need to do research on not just the individual stocks, but also the market as a whole. I’ve been talking about the DOW going back down to the mid 7000 range and it seems that I may be wrong. Then again, it could still be coming, but the mood of the markets is more positive than negative. You can’t fight the markets, you need to ride out the current of the them to take advantage of days like yesterday. No one sector sells off like that in one day without having other investors jumping right in on the great buying opportunity.

Happy Trading.

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The ADP Report Better Than Expected

The April ADP report was released today and it was better than expected. That doesn’t mean that it was all roses though. Many people are still losing their jobs, but not to the extent to where we could be. The report states that there was a decline of 491,000 compared to the 700,000 that the analysts were expecting. In the release, the March numbers were adjusted to 700,000 from the original number of 663,000.
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This brings the unemployment rate to 8.9% from 8.5% last month. This makes it the highest unemployment rate since 1983.
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All the signs of the stock market and the economy show that the bottom is coming (if not here already). The unemployment rate is the last thing to change course. We can expect to see the unemployment rate get as high as 10%, but as that happens the economy will improve.
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In the meantime the stock market has made some great strides this week again. Seeing the DOW at 8500 is nice, but can it stay that way or will it drop down to the 7000 level once more before we really get get back on track. The S&P 500 closed over 900 points and to think of it dropping down below eight hundred is not something that most analysts are predicting.
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Either way I’m keeping a watchful eye on the markets as I continue to be a trader and not an investor. Yesterday was a great example. when the market opened, the trend was pointing downward. I sold out of my positions in the morning and jumped back into the same ones right before the close of the day. In some cases I bought the same shares back at 15% less than the price I sold them at earlier in the day.
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Two of the stocks were
Sirius (NASDAQ: SIRI) sold at 0.52 per share, bought back at 0.42
Caterpillar (NYSE:CAT) sold at $40.75 per share, bought back at $38
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*DISCLAIMER* Billy has holdings in Sirius and Caterpillar at the time of this being posted.

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Today In The Stock Market

With a hour left in the trading day, the stock market has been pretty flat. There have been some great gains with a few stocks as well as some big losses in others. That’s typical in any day of trading, but is this a typical day? On a regular day in the markets, yes it is.
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This morning would have been good if I went ahead and bought into some companies that I’ve been looking at, but as I’ve said in the last few posts, I don’t have too much confident in the markets.
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So should I concern my myself with the money I could have made today doing some day trading? No. There will be some great opportunities in the near future for me to capitalize on.
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The agricultural and consumer staple sectors have done good today. It would be nice to see them hold those gains.
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On a typical day we just might see a sell off come in the last hour. If it does, I’ll be ready to buy on weakness.

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Momentum In The Stock Market

This past week has been great for profits in the stock market, but only if you get out before the momentum stops and the prices come back down from the profit takers. After the DOW fell below 7000 in the last month, there hasn’t been much of a bright side to making money in the markets unless you’ve been shorting stocks. Of course of you don’t have a margin account, you’re not able to short stocks.
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In the past week there has been great gains a many of the stocks that were beaten up during the fall of the DOW. The only way for you to hold on to those gains is to sell. If you don’t take your profits, then you didn’t gain anything if the prices fall again.
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With what’s going on in Washington, it stands to reason that the upward movement that we’ve just experienced in this week, is just a temporary one. Capitalism is under fire with all the spending that is going on in the government. Many companies are laying off people and it will continue throughout the rest of this year. Even though Caterpillar has announced today that they will be hiring back many of the 2,400 employees that were recently laid off, there are other companies that are not in the same position as them. Caterpillar will be involved in many of the infrastructure contracts that will be created by the stimulus bill.
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If didn’t get into Caterpillar when it fell below $22, then you missed out on some of the great gains that the stock has made. It’s not too late to buy into Caterpillar even at the $26 range. I expect good things for the stock over the next year.
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As for other stocks that have made some good moves over the last week, Sirius XM Radio has moved from their recent low of $0.05 in the latter part of February to where it sits now at $0.3362 per share. I’ve talked about Sirius in the past and still favor the company to come back from their near extinction. With it great move of 43% just today, I will be taking some profits and look to get back in on a pull-back.
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Remember to be aware that the turmoil is far from over and there will be pull-backs on most of these stocks that have had momentum gains. Trade carefully and don’t be greedy.
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Happy Trading.

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Stock Market Technicals

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I’ve been warning many of my readers that the stock market will take a dive very soon and from the looks of the last few days, that time has come. If you look at stock market technicals, you are aware that the DOW at a level of 7550.00 is a level that would cause many sell-offs to happen.
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Today’s lows of the DOW was 7551.01, which came very close, but not to the point where the sell off would have occurred.
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I said it before and I’ll say it again, you need to keep plenty of money on the sidelines for times like these when the prices for stocks in good companies are at a great “sale” price. These companies are not damaged, just the stock prices are. You need to be ready to take advantage of these buying opportunities to help grow your portfolio during a bad economic down-turn.
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For those of you that have had patience over the last month or so, this just might be the time for you to jump in and build a good solid position in the companies that you’ve been watching. I’ve been holding back in jumping in with both feet and with the stock market down at these levels, it’s hard not to just dive in head first. Of course I won’t involve my emotions in the markets.
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Who knows where the markets will be in a month or two from now. Especially with the fact that Obama’s stimulus plan hasn’t really been accepted by Wall Street and Main Street. On the news of the plan being approved, the Dow has dropped quite a bit. The markets can hit that crucial level of 7550 and all bets will be off, the sell off will begin and it won’t stop until it get to about 7300 basis points. Then again it may just take back off to the 9000 level just like it did not too long ago.
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No matter what, the rest of 2009 is going to be a total washout and the only way to get your portfolio to grow is to make trades when the time is right and then get out while the getting is good. Either way the market may go either way over the next couple of days, you should keep an old saying in mind, ” hope for the best, but prepare for the worst”. This way you’ll be ready without being disappointed.

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The Stimulus Plan Doesn’t Stimulate Anything

stimulus package

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Well, it’s been three weeks since Obama has taken office and he’s already having a hell of a time trying to get his administration candidates approved as well as the stimulus package. To top it all off it seems that Wall Street along with Main Street have not confidence in the new President.
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The Dow had a horrible day today because of all the “politics as usual” mentality going on in Washington. The government laid out it plan for the financial bailout which basically told us nothing in regards to specifics. It seems that all that Tim Geithner told everyone was that the government will spend more than $1 trillion in private and public support, but really nothing else.
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Wall Street went on a selling spree to unload many stocks to take refuge in safer investment like gold and bonds. The DOW fell 382 points today which is over a 4.5% drop.
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The Treasury’s plan is to restore the credit markets. To work towards removing the bad assets from the bank’s books. They also state that it would help open the path for consumer and business loans. If it is anything like the first TARP plan, they know that they’re going to spend $1 trillion, but they have no clue as to how they’re going to spend it.
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All I got to say is that after last night press conference and today’s treasury announcement, they’re proving to me that this administration has no idea on how to fix this problem and take care of their lobbyist and other cronies at the same time. It’s sad to think that if they really wanted to end this nightmare of a recession, all they have to do is stop the federal spending, cut the taxes and the rest will take care of itself in a short period of time.
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Why would the government need to raise taxes if they aren’t spending as much money? If they have to cut jobs, so be it. If the corporate taxes were less along with payroll taxes, companies would be able to hire the people they would be laid off from the federal jobs that were cut to save on spending. I’m not a genius, but it doesn’t take a rocket scientist to figure that out. Go to any Ivory league college and ask an economic professor and they will tell you the same thing. The less they spend, the less they will need to raise taxes.
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As for the stock market, the DOW close at 7,888 and at this level it’s nothing but a buying opportunity for traders who are looking to a few good deals. Do your research and buy incrementally.
Happy trading.

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