Weekly Review (3/27/06 – 3/31/06)

Look the market...

In the article “A Warning Message”, I predicted a market down in this week and said “The most possible time is from Tuesday afternoon to Wednesday.” Now, let’s check out this week’s result:

We can see that both Dow and NASDAQ were down at Tuesday afternoon. From the peak to the bottom, Dow was down about 125 and NASDAQ was down about 25. Both downs were over 1%. Despite the down was smaller than I thought (NASDAQ decrease >50), it can still be considered at a medium to large scale.

For the whole week, the Dow was down for 170 and the NASDAQ was up for 25. The two indexes have started out of synch since Wednesday. The strength of tech stock, or the NASDAQ, came too early. It acutely will bring the uncertainty to the market for next week.

From Dow, we can see that the market is nearly ready for the next charge; from NASDAQ, because the down pressure is not completely release yet, the shaky situation will dominate its up track for next week.

While I finished my study, I found an interesting point and want to share with you: If you want to know the market of next week, please referral to the whether of New York City.

Let’s check it out whether it is correct and have fun!

***

This week, I suggested my readers to reduce your position and have enough cash. Because the Dow is down, now it is the time to get back. For the next week, our strategy is to accumulate stocks whenever the price is lower.

Because my suggesting list is getting longer and longer, I will not discuss them one by one going forward. To keep my article short, I would rather not to mention the ones that do have much change.

1. CSCO
“Reduce your holding when it above $22.00.” --- If you read my last weeks review, and checked Cisco’s five day chart, you would know what exactly what I mean.

The price of CSCO reached $22.00 just momentarily during this week!

I expect it will performance better starting from Thursday.

2. GOOG
Google was the star of this week. On Monday, it did not reach $372, but on Tuesday and Wednesday, it broke its two very important resistant lines: $375 and $390. Finally it did not cross $400 which is the most important psychological line.

The Google is too wild and too difficult to predict now. We need to wait and watch. The $400 line is so critical that if it was crossed, the stock will have a short rally; if it could not, the stock will shift between $400 and $350 for a while.

3. ANX
It tried another time for $5 and was almost there. If you have not had it, you should buy some.

4. SUNW
Just as I wished, the Sun is rising!


5. LVLT
If you follow my instruction in my article “Insider News”, you may have a 10% margin in your pocket, haven’t you?

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Some readers are very interested the option trading, and want to know more about it. Going forward, I am going to periodically introduce some basic knowledge and terminology from my own understanding.

You are welcomed to write comments or email your question to me.

Wish you be successful on your investment!