E-mails galore

In one of my e-mails I was asked about Embraer-Empresa Brasileira de Aeronáutica S.A. (ERJ). As can be assumed, it’s an aircraft maker based in Brazil. Usually I’ll stay away from aerospace, but this one looks promising. This is not a stock for the faint of heart, as no aerospace stock ever is, but with its latest positive earnings and yesterday’s deal with China's Hainan Airlines Co. we have plenty of catalysts to keep this one in the air. ERJ supplies many different countries allowing it to dodge the coming recession in the American markets. Charts look good, but it’s overextended. Allow it to come back down to 37.5 and if you like this one, hop aboard.

Good Ol’ Valero (VLO) This stock has been my biggest money maker of all time and I was asked for an analysis. Currently VLO is a chartist’s nightmare. As shown, there are two strong opposing trends. The stock is sitting on its 50 week moving average, which implies high volatility. If anybody trades options, I believe a straddle is in order. I have the bias that oil will hit $90 per barrel, so I can’t say to short this one, but buying seems unreasonable. VLO has its nearest support at 40, and its best support all the way down to 30. I’ll stick to the trends that are more consistent.

I will cherry pick from the stocks Andrey left in the comments since I still have more e-mails I need to get to, and I can’t do too many at a time unless I want to make a mistake.

I’m skipping World Wrestling Entertainment, Inc. (WWE), since they reported today. Again I’ll advise to never jump into a stock the day before earnings. Not even the professional analysts have a good handle on predicting earnings. If anybody got into WWE, hop on out for the short term because it’s already overextended (17.40 at the time of this writing).

Finally, Vical Incorporated (VICL) was suggested. I love the fact that insiders from the company are picking up shares. A few analysts like the company and it may have some good products in development, but it has no revenue generators yet. As we all know I currently own Amgen, but all biotech’s are not created equally. This is a high volatility stock with an average day of 4% change. You should not own VICL unless you can handle a big risk. Some may disagree, saying that VICL has licenses, partnerships, and XYZ product being developed but with a recession coming, a company without a product is a sitting duck.

Thanks for the stocks,
and again I hope this was helpful.

*Edit* I found this article that mentions AMGN as a recession proof stock.

Random Stock Analysis

In these slower days near the end of summer, there are not many stocks out there enticing me, so today I’ve decided to entertain a few stocks thrown at me by a fellow trader at stockforlife.blogspot

If you have a stock you need analyzed, feel free to drop me an e-mail or add a comment.

Cabela’s (CAB) – I don’t like the outdoor retailers here, but with two strong supports this one might be considered for the longer term. There is not a lot of reward here short-to-medium term because most project this stock to reach 22 by Jan. The stock is nearing 20, so I’ve no interest. Also the Short % of float is 12.51, which tells us that volatility will make CAB’s moves unreliable. (As a technical trader reliability is key)

Cubic Corporation (CUB) - The charts on this one looked wonderful in November. Although the most recent quarter was excellent, we are dealing with a family owned company that has more potential than they will allow it. Erratic earnings and bad charts give me reason to think this is a short sell nominee; however this company is an obvious buyout candidate. CUB is below both of its 50 & 200 week moving averages. I would wait for a second good earnings announcement or a surprise catalyst before considering.

Abercrombie & Fitch Co. (ANF) – I was debating on this one mid August when it broke its 50DMA and sat on it for a week, but those of you who read this blog know I’m not one to buy a stock right before earnings. Earnings came out positive, and the stock is currently up around 63. I like the stock and think it can hit 70-75 by December. Personally, I’m not eager to get into retail with a recession coming, but this one will look fashionable if it comes back to 60 (its 200DMA).

Harris & Harris Group (TINY) – A venture capital group investing in the future of technology; “tiny technology”. I have to say I had never head of this group until it was suggested yesterday, and last night I did enough research to write a small book on this one. The charts look perfect and I’m taking a position! Well… at least that’s what I thought last night. Today they took a jump over 10%. Damn. I can only hope that traders sell it back down near its 50DMA around 10, and then I’ll give it another look.

Always looking for the next trade so feel free to drop a stock.
I hope this was helpful.

Few Updates

Well I'm finally moved in, but my final year of school started yesterday. My Bachelor of Science in Business Administration is within reach, however, I'll have to slow down on the posts to keep the grades up.

I'll keep up to date on the important things. Also, I've added the Yahoo quotes so we can better track the stocks I've suggested.

Now back to the market,

• STP bounced on the 50DMA as prescribed
• AMGN broke through the 50DMA another happy note
• SIRI is looking uneasy nearing resistance at it's 50DMA, I'm guessing a few days of turbulence, and then it can shake above it.
• CHCI is doing wonderfully for a homebuilder in midst of the more recent turmoil in the builders
• HAL seems to be immovable. I will be honest, this is my least confident pick but I still think it will fall.
• DXD and SDS are on the backburner until the Dow Jones Industrial Average hits a double top, or until big money finally realizes that this recession will last more than a year.
• Finally, I'm taking RMD off the watch list as it provided a nice gain, and I took it.

Happy trading

Keep It Simple Stupid

When I started trading I thought I would beat the market with a complex valuation model.

I included everything I could. Technical factors, analyst opinions, I even used other valuation models into my own. Then I had it spit out a number 1 through 100, 100 being the best.

Every stock would spit out a number around 60. No stock ever stood out in my models. Analysts for the investment banks I used in my model would have "buy" or "outperform" ratings without reason. The analysts changed their minds sometimes monthly. There were no time lines to the investments suggested.

The problem with these services are time frame and reasoning. There are none. They don't tell us to "buy for this reason" or "sell at this point". The way I see it, they can just keep a buy rating on everything and sooner or later they will be right.

My own three rules for K.I.S.S.
1. Have a very good reason for buying a stock (technical/valuational & logical)
2. Make sure there are no conflicts (earnings, recent CEO departure, recalls, etc.)
3. Pick your timeframe (long-medium-short term)

Forget the analysts! As insider information is almost impossible to come by anymore, these guys no longer have a clue. They know just as much as you and I.
____________________________________________

Onward to money making. STP is ready to move up. This stock will most likely bounce on this 50DMA support line, and if not, the lowest it can go is 23. I don't know how to make this any more clear. Buy STP for the medium-long term. Barring any crazy anomalys, this stock is going higher.

So Far So Good

I'll keep today’s post short and sweet.

The first pick of my blog, RMD finally reported earnings and gave just what I asked for. If you took a position in shorting this baby as I suggested, you would have made over 10% in three days. As of today I’m taking profits and saying to cover if you are still short. Although this one could go lower just like HANS did, I’m happy with my gain.

SIRI bounced back above its weekly 200DMA to my delight after riding the coattails of XMSR’s upgrade by Bear Stearns.

The market is consolidating, so don't think too hard about what is going on. As always I'll be searching for the winning picks. Happy Humpday.

The Future Looks Bright

One of the biggest topics in America today is energy prices. So a logical long term investment includes renewable energy. Wind ethanol, geothermal, or solar: they are all useful. The question is which one will make you the most money. That being said, buy Suntech Power Holdings (STP) here's why,

1. Wind power companies don't seem viable as a safe investment since the government must give out incentives for these companies to be profitable.
2. Ethanol companies have been hyped recently, as many gas stations are now using the fuel. It will be a great renewable energy source, but the market needs to settle a bit, as investors have already profited here and valuations were a bit overdone.
3. Geothermal stocks are fine, but I don't think they will ever get the spotlight they deserve, because too many people don't understand the process. A congressman won't support an energy source that the public is uneducated about.

That's what this really comes down to. Our politicians will be the main supporters of alternative energy as Americans are finally getting fed up with high energy prices and global warming.

This is why I am suggesting solar energy. Solar stocks are off the high that we reached early this year, and are ready for another round.

Let’s look at the 3 most likely candidates:

ESLR– Forward P/E of -24.60 (yes they are still unprofitable). Recently the CEO sold about 1/5 of his shares. Ouch, I want my CEO buying more shares. Also due to research and development, ESLR had a larger loss than expected in its latest earnings report.

SPWR– Forward P/E of 106.10. Last week the CEO sold 2/3 of his shares. Again, ouch. Average earnings news here (for a solar stock).

STP– Forward P/E of 45.70. No sells yet by the CEO. STP Raised guidance a week ago. Also, they are extremely profitable as they are based in China, keeping their labor costs very low.

The biggest possible threat to solar power companies is a shortage of silicon, and STP decided to cover their bases by signing a 10 year contract with MEMC electronic materials in which they will provide silicon wafers. Nothing but positive articles here.

In no way am I saying that the other two solar companies mentioned are bad stocks to own, they will both probably do well. STP just looks like the best one to pick up. Once again buy STP and hold, as it should do well all the way though elections in 2008 (and probably further)

Snooping through the web the other day I found Barry Ritholtz’s blog, which gave some very interesting articles on the stock market. Check them out here and here.
Kudos Barry, for the excellent research.

(Full disclosure: I bought shares of STP on 03/17/06 and 12/7/06)

*Edit* Today looks perfect to buy them, as they started around 29.5.

Take Two and Call Me in the Morning

I will be posting less regularly for about a week or two because I'’m moving. After I'm all set in my new place, all will be back to normal.

Last post I finished by saying Buy Amgen, allow me to explain the trade. Amgen (AMGN) is the second largest biotechnology company in the world, so there wont be much volatility. When you get a stock with a market cap around 100 billion dollars, everything is usually priced into it already. This is why I prefer small to mid caps, but in this case the large size may help.

Daily Chart

• Good spot on the Slow STO
• Rising MACD
• Yes, I see the stock is below the 50DMA but this will be broken

Weekly Chart

• Bad MACD
• 200DMA support

Keep in mind, the 200DMA is the strongest support/resistance line for a stock. Amgen is coming back into favor as pundits like Jim Jubak and Jim Cramer have recently highlighted. (click on their names to read further)
_______________________________________________

Now on to the DJIA, something that it seems many technical traders are missing and what I mentioned earlier, is that we could be setting ourselves up for a double top. (marked by the dotted line at 11600)

I've shown how the DJIA had reacted whenever it's Slow STO gets above 150 in conjunction with it's RSI above 65. Each time it has dropped over 600 points. If we hit 11600 levels in the next week or so, this could play out again.

You could easily make the opposite point, when the Slow STO hits 20, the DJIA bounces, but what makes this shorting opportunity more promising is the 4 month double top which would develop.

Buying the DXD would be the obvious play if this pattern forms.

(Full disclosure: I bought shares of AMGN on 08/08/06)

The Waiting is the Hardest Part

Biggest rally in two weeks, eh? With all of the bearish talk I'’ve been making, you would think I'’d be upset about this, but I'm not. My portfolio, which I outlined last week, is doing great. (Mostly thanks to STP my solar power company which reported earnings)

Core PPI was reported today, and unexpectedly fell .03%. This eased inflation fears, allowing the bulls to make another "Fed is done” rally".

For those of you confused about all of this technical jargon on the economy, let me sum up the two things that are still moving the market:

1. Inflation- when the prices of goods go up. (due to an increase in available cash & credit)
2. Stagnation- when the economy's growth slows. (due to slower spending habits of consumers)
3. Stagflation- when the economy's growth slows while prices of goods are going up.
   

Stagflation is a problem because tools for directing the economy can't fix it.

Our economy is still slowing and we may switch into bear mode soon, which would create a hard landing. But some pundits like Jim Cramer have been predicting a soft landing. I've not heard anyone take the middle road on this issue, a mild stagflation that would allow the economy to slow, but still eek out a gain. I'’m not convinced of anything yet.

Wall Street is trading on the data day-to-day so there is no long term trend yet.

The S&P500 is breaking a crucial level of 1280 to the upside, as the MACD crosses, and moves above the 0 line. This is good for the bulls, and makes me wonder if that double top around 1325 will take place. This being said, hold off on the DXD and SDS as the bulls may have some short term strength.

Wal-Mart (WMT) gave earnings today with its first year over year profit decline in 10 years. Their earnings call alluded to an unconfident full year guidance with concerns of high gas prices. If Wal-Mart isn't suggestive of the American economy, I don'’t know what is.

Tomorrow at 8:30Eastern Consumer Price Index (CPI) will be announced, so hold on for the bumpy ride. Wait for a clear longer term trend and stay in secular or defensive plays.

Here is an article on interest rates and the economy from the New York Times. (Don'’t read unless you'’re truly interested, as it is on the boring side)

Buy Amgen & Sirius. The risk/reward is just too good at these levels.

*Edit* Core CPI rose .02%, slightly positive for bulls. We are now at a 25% chance of a rate hike.

One of These Things Just Doesn't Belong Here

Don't own a stock that you wouldn't buy today. I've read this in many different books, in many different ways. The biggest folly of the amateur investor is holding losers too long and selling winners too soon.

This is the only time I will ever endorse the opposite. I've been holding Nabors Industries since the beginning of the new year, and all I have to say is: Watch me folly! I wouldn't buy it and I'm holding on. Sounds ridiculous to me too. In any case, today I'm suggesting to short sell Halliburton (HAL)

To get a good look at the overall oil services picture, lets look at Oil Services Holders (OIH). This is a collective trust of oil service stocks, basically like an index. This is its weekly chart

• The three blue lines show a head and shoulders pattern (very negative)
• The blue circle is the MACD crossing the 0 line (very negative)
• Finally, the arrows in eccentricly happy green show bottoms in the slow stochastic (possibly positive)

Many people are shorting these OIH stocks, and for good reason, as stocks like Halliburton (HAL) are showing the worst charts of all. Here are the weekly and daily charts.

• On BOTH the daily and weekly charts the stock has broken supports, creating an amazing amount of resistance lines. (50DMA, 200DMA, and trend line for the daily, 50DMA and trend line for the weekly)
• The 50DMA is starting to cross over the 200DMA on the daily chart
• Daily slow stochastics are overbought

Aside from charts, Halliburton has been having random troubles that could disrupt future earnings.

Now for Nabors, here is it's daily chart

• NBR is sitting on its support (positive)
  
• The MACD has just started to cross (negative)

Although I am a technical trader at heart, I can't drop this stock. Why? ALL 3 of the most respected investment research services have the highest possible rating for NBR . As always I can't go into further detail because these are subscription services. If you don't subscribe to any I always suggest you try one out, as most have free trials.

Also as a bonus, Jim Cramer is also very bullish on NBR.

The problem is that many oil service stocks should be moving downward, and the pressure could force Nabors downward in sympathy. As Sesame Street used to say "One of these things just doesn't belong here," and Nabors is it.

Hopefully groupthink won't force the good down with the bad. Short sell Halliburton (HAL)

Overview

You can't make profits in stocks if you don't keep track of your positions, so lets not get lost. I'll go over all 6 of the stocks I've recommend so far.

RMD
Charts still look great to short sell this one, the only problem is that earnings are on the 17th, so I wouldn't pick it up. Patience is a virtue.

SIRI
No special news here, the prospects are still excellent, as always. The stock is at 3.78, setting right at it's Weekly 200DMA of 3.80. I am, however, getting nervous that it broke a very strong support at 3.90 as shown in the weekly chart. As I said from the start, this is a risky stock so I'm prepared. The MSN article is positive, while TheStreet takes a Yes/No/Maybe outlook.
MSN article
TheStreet article

DXD/SDS
The DJIA has dropped a little more than 100 points since I recommended it, I expect at least 300 more by the end of the month. Sill a good prospect here.

HANS
Ending coverage here, as I excited my position and suggested the same. Shorted around 42 and covered around 32. As shown, the stock reached 28.

CHCI
Well, it's back around 4, where I suggested it after an up 8% day. I've no problems in suggesting adding to this position for the long term. Unless anything big comes up on this one, I will stop tracking for awhile. Thomas Ko is still positive on CHCI in this article.
MSN article

NTDOY
As nobody has dissented with my views on this one, I feel the need for opposition. I found just that in an article by Michael Brush. He explains that video game companies are the ones to be buying for this 4th quarter.

While I don't disagree with the fact that game developers will do well, (I would recommend an ETF for video game makers if there was one) I believe that you will be much more safe in Nintendo. As Tero Kuittinen, of TheStreet.com puts it:

"Nintendo's share price has performed strongly over the summer, moving from $17 to $23 during the past six months. It's a fairly solid performance, considering how wobbly software companies like Electronic Arts and Activision have been during the same period."
Here is TheStreet article for that.

Gamers are picky about their games, don't get greedy and take the added risk of owning a single game maker.

The big picture right now is that the market should be going down in the near term.

Enjoy the rest of the day.

Searching For a Trend

Did aerospace stocks rise yesterday after a near miss of an airline disaster!? While I‚’m scratching my head over that one, I'll catch you guys up on my thoughts of GOOG.

In a previous post I talked about the possibility of shorting GOOG and I wish I could say to jump in, but sadly I still can not recommend it. Although I really want to since the technicals are screaming SHORT!!!

• 4 strong resistance lines, the downward peaks resistance, the upward lows resistance (not shown), the 50DMA, and the 200DMA
• The 50DMA is crossing the 200DMA, this type of sell signal is doubly bad, since the first crossover for a company usually follows through.
  

That being said, the problem is that Google keeps making deals with other companies and it's making the future earnings hard to evaluate. How much upside will they gain from their partnership with myspace.com? Could be more then we expect. Not only that, but the S&P (one of the only ratings systems I respect) recently upgraded GOOG from 3 stars to 4.

I’m going to hold off on this one as it nears a support at 365. If it breaks through, I may reconsider, but then again at that point it may be too late to join in.

Still no major trends showing in the market so if you're waiting to get into something, best stay defensive. As always I will update you guys on Sunday night,

Have fun this weekend!

BTW, this is a pic of a lounge inside the Googolplex (their corporate office)... What a place to work!

Wii Will Rock You

What's the best way to make money? Find your competitive advantage. Being a college student, soon to graduate, I know something that most of wall street doesn't have a clue about. Video Games. Buy NTDOY,

Which Next gen console will win the battle between the Wii, Xbox360, and PS3?

Wii has four advantages over it's competitors.
1. The controllers are revolutionary with motion sensitivity and a TV controller look.
2. The games are meant for all audiences; yes I can see a 50 year old swinging the controller against a 10 year old in a round of tennis.
3. The cult classic games. Fun gameplay will always trump graphics. Who can wait for the new Duck Hunt or Mario Galaxy?
4. Price Wii Price: $200-250

These four components are shown when comparing Nintendo's handheld DS to Playstation's PSP.
1. The DS is a touch screen
2. The games are meant for all audiences (Brain Age)
3. The classics are here (New Super Mario, Mario Kart DS, Metroid Prime: Hunters)
4. Price $150 compared to PSP's $200

Needless to say, the DS handhelds are flying off the shelves (as explained in their last earnings summary. ) While the PSP has bombed.

Xbox360 released too soon, it's games turned out to be mediocre, and the system will be considered old news by Christmas time.
Xbox360 Price: $300-400

PS3 is a graphics powerhouse with tons of futuristic extras. Yes I could say that the PS3 also has a motion sensitive controller, but from the most recent reports it is merely a rip off, and not well utilized. (Basically just to say that they have it)
PS3 Price: $500-600

No that wasn't a typo. This is what will kill the PS3. Mom and dad will not shell out $500 for a PS3 this Christmas, when they could buy an Xbox360 AND a Wii for the same price.

PS3 fans will tout the HDTV, the Blu Ray discs, the (insert pointless added frill here). Xbox360 fans will mumble something about Halo. But when it all falls down, both of these systems are missing four crucial things.

I'm not charting this one, as it's not as reliable to do with an ADR. Buy NTDOY and hold through January. If you do, I guarantee this holiday season you'll be rockin' around the Christmas tree.

Nintendo is an ADR so you can't just trade it daily. Buy it at market when you think it will bounce, I'm thinking around 22.2 at it's 50DMA.

If you have the time checkout this link on the Wii.

Confidence Rating: 5/5

You Live, You Learn

After a wreck of an earnings report, CHCI took a whammy that I didn't expect. I did think that their earnings would be dismal, but the size of the move afterwards surprised me. It was a SNAFU on my part to not warn everybody to wait until after earnings (or that they were reporting in the first place). I assume nobody took a position yet as I haven't gotten any hate mail (hah), but now is the time to get in. As a side note- I made a checklist for myself to go over before I recommend any new stock.

A long term position like this should be scaled into, unlike a trade, where you need an "all or nothing" attitude. If you have faith in CHCI, scale into this stock slowly and stop watching its daily movements because this is not a trade. All is well that ends well, and I have no doubt that CHCI will end well. With that said, my long term view holds true, we may have to wait for a catalyst for this little guy, but it will come in time.

I was snooping around MSN's finance page and found that Thomas Ko, the winner of CNBC's stock trading contest, has CHCI in his Strategy Lab portfolio.

(Full disclosure: I bought shares of CHCI on 08/08/06)

*Edit* I probably should say that the Fed decided to pause today, and the market went down on the news. Bad Omen?

Building the right Portfolio

Buy CHCI,

Traders often go after quick risky plays with high volatility, but every once in awhile you stumble on a value play that you can'’t set aside. Comstock Homebuilding Co. is just that. Everybody should have some kind of secure long term stock in their portfolio, CHCI is a good one here's why,

This may seem counter intuitive to be buying a homebuilder when homebuilding has already peaked, and it has. But before writing off all homebuilding stocks, we need to understand the psychology of the market with technical analysis.

Here's the Weekly Chart

• The stock is not trading with its MACD, a quick tell which led me to look at it's daily
  

Here's the Daily Chart

• The Average Directional Index (ADX) shows a move below 40 to suggest that the current trend is coming to an end. A move above 20 would suggest the start of a new trend.

• With the On-Balance Volume (OBV) increasing while the stock is leveling off, it shows that buyers are starting to accumulate the stock, possibly making this a good point to call a bottom.

• Here again, the price is not playing along with it's MACD.
  

Let'’s appreciate the fact that every big money investor has already sold their homebuilding stocks. They knew to sell when things started getting choppy. We are looking at a stock with a P/E of 3.12 and a forward P/E of 3.70. The average P/E in the Residential Construction sector is 6.7! CHCI is not having any unusual problems to merit a P/E of half it's competitors.

To sum it up, CHCI has been cut in half in four months, the sellers are gone, and the gain/loss ratio is very high. Be patient and buy this one for the long term.

Confidence Rating: 5/5 Stars

*Edit* I covered my shares of HANS today, to make a quick four day gain of 33%

Headed for a Whammy

How many rallies can we get from consensus of a rate hike stop? This upward movement will end and here's why,

With higher margins that will hurt companies, weak unemployment data, a weak housing market, and a slowing economy, we still keep going higher all because of the end of raising interest rates.

To all of the bulls out there I ask, what catalyst will there be after this FOMC meeting? I have changed the comments section so anybody can post now, and I would like to hear some opposition to my opinion or any thoughts on this.

I would like a long term bull market, I just don't see it as a viable outcome. Keep in mind that August and September have historically been the worst month for the S&P in the last 18 years.

I got a kick out of this cartoon, as it sums up my conviction.
If you own a high flyer, sell on the news.

I will add some stock ideas next post. I did end up shorting HANS yesterday, if it hits 35 I will cover, although it could go further this month.

I'm hoping the market surges higher, as it will create more opportunities for us to take advantage of.

Have a great weekend.

*Edit* The Dow is now flat for the day after hitting 90 early on. It seems traders must have taken a step back to look at the big picture. Also I found this article on Google today.

Quick Post

I'll make this short and sweet today, since I'm backed up with things to do. I will elaborate tomorrow if I get a break.

It's not the end of the day but currently the DJIA broke a strong resistance. Fortunately it has 3 other resistances still above it. I will be doubling down on DXD if the DJIA hits 11,400.

HANS might be a good short depending on where it closes today (the higher the better). I planed on talking about shorting it today so I'm a little disgruntled that it's down 7% before I got the chance. I still think it's good to short because of its lack of supports. Also I'm debating on weather to short GOOG. If it reaches 390 again I might force myself.

The Fed reports on interest rates on Tuesday, August 8th. I don't know whether to root for it or against it, as half my stocks will like it and half will hate it, but I guess that's what diversification is all about.

These next five days will likely decide how the market trades for the rest of the year. Read The Kirk Report for today, as he makes a good point on the strange advance today.

*Update* on SIRI & Extra

Unfortunately SIRI did not see a pop on earnings. Although it's earnings were good (missed by 2 cents on EPS, but had higher than expected revenue. Most important, they raised full year revenue and subscriber guidance) So why didn't we see a jump in the stock?

I hate playing the blame game, because there is no "out" for a bad stock picker, it's always his/her own fault. But let me try my best to explain what happened,

The day before Sirius reported Jim Cramer decided to have his biggest segment on XM Satellite Radio. Jim explained why he believes that XM will get bought out by Sirius. AHHHH!!! We all know that Cramer moves the market, and if you are new to this game, that the buying company goes down in price, while the bought company gets a boost. In all fairness, the very next day when it reported, Cramer talked about how Sirius shouldn't have traded so somber.

I still think his convincing idea that Sirius would buy XM trumped the data. I can't make an educated guess on a buyout, but I will say that XM has a history of stubbornness and Mel Karmazin, CEO of Sirius, has said he is not actively looking to buy XM.

Regardless of what happened in the immediate term, it is August and I plan on holding Sirius through December. As explained in my previous article, the last few months of the year are best for satellite radio. As long as it stays above it's 200DMA on the weekly chart at 3.79, I won't get itchy on the trigger finger.
________________________________________________________

Aside from Sirius,
It feels like fun today. Hurricane Chris is getting closer, natural gas is shooting through the roof, and my stocks are doing well. I'll take this chance to go over my current portfolio:

(UNH) UnitedHealth Group- Diversified health care company
(STP) SuntechPower Holdings- Solar power maker in China
(NBR) Nabors Industries - Oil & gas driller
(AMGN) Amgen- Biotech company
(NSRGY) Nestle- Food & beverage company (yes, the chocolatier)
(SIRI) Sirius Satellite Radio- The larger of the duopoly
(DXD) Ultra Short Dow30 Proshares- Previous article explains it

What makes this is a good portfolio?
Based on my belief (and many others) that the stock market will go into a recession, I have concentrated into two types of stocks: (Aside from SIRI, which is tagging along for fun)
Defensive stocks- UNH, AMGN, NSRGY, & DXD
Energy stocks- NBR & STP

These types of stocks should pull their weight no matter how the market plays out.

No trade ideas for today, except to pick up some extra DXD or SDS as the market goes higher these just get cheaper.

Happy Trading!