Timothy J. Truebenbach is the
President of True Capital Management and general partner of True Capital
Partners LP, a hedge fund. He uses a disciplined model that trades on the
intermediate-term time frame. For a free trial to Tim's Nightly Stock Analysis
Report
click here or call
888-484-8220 ext. 1.
I am seeing multiple distribution days in the
market, leaders shaking investors out and yet this could not be a more bullish
scenario! Yesterday’s trading, for example, showed the major indices rallying to
new highs on above-average and heavier volume than Monday. Leadership is
stronger than ever, as we will talk about shortly…for now, here are the charts
of the market.
Chart courtesy of
StockCharts.com
Chart courtesy of
StockCharts.com
What do Digital River (DRIV | news | PowerRating | PR Charts ), US Global Investors (GROW | news | PowerRating | PR Charts ),
International Securities Exchange (ISE | news | PowerRating | PR Charts ) and First Marblehead (FMD | news | PowerRating | PR Charts )
have in common? They have all managed to shake out most investors and pushed
higher.
Chart courtesy of
StockCharts.com
It is never fun to be knocked out of a name before it head’s higher, but
sympathy can be found in the fact that this keeps investors watching the overall
market cautious and unwilling to make future commitments. Bull markets climb a
proverbial ‘wall of worry’ and moves like these add to that wall. Just think in
terms of this: the larger the wall, the higher we can potentially climb!
Small- and mid-cap names seem to be taking the reigns for now while larger-cap
stocks set-up for some action which appears to be right around the corner.
Copa (CPA | news | PowerRating | PR Charts ) broke out of a new buy point in Tuesday’s trading and appears
to be continuing its run higher.
Chart courtesy of
StockCharts.com
Google (GOOG | news | PowerRating | PR Charts ) is the next Microsoft (MSFT | news | PowerRating | PR Charts ), in my mind
if no one else’s and is approaching a Buy Point at 492.06. Fundamentals are
still very strong and if you’re wondering how high this stock can go, ask
someone who passed on MSFT in the late 80’s/early 90’s what they had said about
Softie!
Chart courtesy of
StockCharts.com
Enjoy this market and be sure to be a part of it. We will constantly look to
make sure distribution does not increase beyond the occasional day or two we
have seen now and then. If leading stocks start hitting 50-day moving averages
and falling apart, we also have a serious reason for worry. BUT…for now things
are very bullish.
