Stock Market Commentary April 5-9,2010
Hope you had a nice long Easter weekend. I apologize for the delay in updating this week’s commentary. Looks like I have too much fun this long weekend.
Based on the past few week’s market action, we’re not looking to go down until we break the 1150 level on the S&P 500. We made a bit of money on our inverse etf’s last week but then the market reversed to the upside on Wed afternoon and we are now looking to go long this market. A popular saying is the Trend is your friend and the trend is up so dont fight the trend. There are quite a number of opportunities this week. I like the action on natural gas as it looks like it is potentially reversing to the upside. Natural Gas prices have been dropping like a rock in the past year and Thursday, we saw a bit of a spike due to lower inventory levels than expected and it looks like the shorts have to cover. I would get into natural gas via the ETF UNG and if we can buy it near 7.20-7.30 then we’re looking for a target of $8.50. Also, I like the gold sector now as it has broken to the upside and we like the gold stocks etf which is GDX. We’re looking for a breakout above $47 and a target sell price of $51. Remember, before entering into these positions, make sure u have a stop loss. I wouldn’t let your stop loss be more than 2% of your entry price.
A lot of people have asked me about Research in Motion (RIMM) and I am waiting to buy this stock at much lower prices. Their market share is slowly being eaten away by the Apple iPhone and Goodle Android. I would stay away and maybe look at it if it reaches around $60. They could get a pop if they announce a phone similar to the iPhone but their device is really considered an email only product with limited web capabilities compared to the iPhone. As for the Apple stock, if you own it, then stay with it and set some tight stop losses. The news out is the iPad is selling well but it’s not gonna be a game changer compared to the iPhone.
Have fun this week.
Mike
