[Weekend Summary]
Dear Member:
The first few days of 2008 have hit the bulls hard. The Dow Industrials, S&P 500, and Nasdaq Composite have all fallen below their important 200 day moving averages. Each is coming toward a very critical level of support. The next Dow support is around 12,724, the Nasdaq around 2540 and the S&P 500 about 1406. If these levels are broken, it could be a very unpleasant ride for bulls and those who advocate buy and hold no matter what. There is a great deal of speculation about the Fed reducing interest rates another 1/2 point in January and that may serve to stem the tide, but there are still huge credit problems out there. As I have said and written before, if we think there is a problem with the sub-prime mortgages, wait until consumer debt catches up. There are already signs of borrowers falling farther behind on consumer debt and that certainly bears watching in my view. All that having been said, there are plenty of ways to profit from downturns and I have used some to my advantage this past week.
Well, 2008 started off well for me. I bought Iamgold (IAG) on Wednesday and the stock was up 5.75% by Friday close.
Sypris (SYPR) is holding its own against the downward market pressure and continues in its channel. I'm looking for an upside breakout for this one.
City Telecom HK (CTEL), though below my entry price, continues to move upward along the 200 day exponential moving average. I do not think the downdraft in the U.S. markets should have too much effect on CTEL.
Blackrock Sr Hi Inc Fd (ARK) has moved up pretty steadily since I added to my position a while back. It continues to churn out regular monthly income at a very attractive rate.
Introgen (INGN) dropped on disappointment from news that it would be supplying additional data in support of final phase testing of a cancer treatment. As best I can tell, the data was positive, not negative, so the likelihood of a successful final phase may well have increased. The market disappointment arose because the final results will just take a little longer. In other words, no instant gratification. Though this has always been a very high risk play, I like it more than ever.
Once again, with these cheaper stocks and a falling market, I am exercising extreme patience. The tide is currently falling and I am trying to be extremely selective in finding candidates that can move against the flow. Iamgold (IAG) is an example of those efforts. So far, so good.
Thank you for subscribing and have a great 2008!
Bill
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