Sell in May, Go Away

Many of you might already heard of the phase - "Sell in May, Go Away!".  During the summer months, many stock buying and selling activities might be slowing down due to vacation season.  Stock prices usually go lower due during the summer season.  Hence, many investors usually sell during the month of May and buy back the stocks on the month of September.  I usually follow this theory as I am selling some of my holdings throughout the month of April ahead of summer season.  I will update on this website to see if the trend is correct for this year.

Nasdaq crossed 3000

Nasdaq composite index crossed 3000 for the first time in more than 10 years. Apple stock contributed a lot of gains to the index. Looking at the chart, the next resistance point is around 3200 dated around May 26, 2000. There are about 200 points to go. All indexes seem to have a uptrend except for TSX might be falling due to falling commodities prices.

Dow Jones Industrial Average 13000

It seems that DJI didn't really cross above 13000 on Tuesday, February 21, 2012. We will have to see today if it can actually test the mark again. I proceed to sell some more DJI index to take some profit off if it fails to cross above 13000 again.

S&P reaching to a resistance level

S&P raises 3 points today and it is reaching a resistance level. 1370 is the next resistance level. Next Monday, both US and Canada will have a day off, next week will be an important week to examine whether S&P can pass through the resistance level. However, my view is that it will not pass through the resistance level and I might take some profit off in some US securities next week.

Oil is raising...

The headline for this morning is that Iran cuts oil exports to six EU countries. The countries affected include Netherlands, Spain, Italy, France, Greece and Portugal. The price of oil is trading up this morning, hence, it will certainly have an impact to already a weak economy. The sold positions last week indicate it is a good move and will continue to monitor technical graphs to the major indexes. Canadian bonds seems to be a good investment for these uncertainly environment.

Not looking too good...

There are several factors indicated the market is heading lower:

1) Several indexes did not pass through the resistance from last year high around April, May or July 2011.

2) Greece issue and what do to do next

3) Have a health gain in late 2011 and early 2012.

I just sold some mutual funds on DJI, S&P and Financials.

S&P 500 - iShares S&P 500 Index (IVV)

S&P 500 has reached 1350 area previously reached on July 2011 (Twice - Double Tops), April and May 2011 (couple of times). It is again trying to pass above these resistance points, so far it has not been successful. SMA 15 is above SMA 50 and both FSTO and SSTO are in their high of the sessions. I will wait until later in the day for selling some of my positions in S&P 500.

IVV is the ETF for S&P 500 traded in NYSE.

After 3 consecutive Down Days for Financial Sector

After felling to pass through the high since July 2011. It has fell 3 consecutive days for financial sector stocks. Today, it continues to fall further. The Fast Stochastic Oscillator (FSTO) is falling close to 0. It seems we have reached a mini over-sold position. A light rebound might occurs in the near future for short term sellers.

More news on Interest Rate

Feb announced US Interest Rate will continue to stay at historical low until late 2014. Possibly going to stay low until 2015. Hence, stock market gain as the result late afternoon. This gives dividend paying stock even more attractive. I am now pausing further selling of financial companies. The financial companies as a group could pass the July 2011 high and test the double tops occurred on April 2011 and June 2011 respectively.

Financial Services Sector (Part II)

It is testing July 2011 high point and it seems that it will be down day today for the financial sector. I will assume that we are reaching the over bought area and some profit taking will take place today and coming days.

Financial Services Sector

I noticed with the recent uptrend for the Canadian Banking Section starting beginning of December 2011, It is already increase well above 5% from the low point of Nov 25, 2011. It is about to test the high point for the month of July of last year. I am about to sell some of my positions around this area and see if it pass through the resistance mark.

50 and 200 Day Moving Averages 101

One of the most effective and widely used technical trading tools is the simple moving average. The two averages that I looked at are 50 days and 200 days simple moving averages (SMA).

When I trade indexes, I usually look for those two averages and see how they perform over the year. A quick way to see whether it is a good entry point is to see whether the 50 days cross over and above the 200 days moving averages and via versa.

You can use google financial and other charting tools to do a quick technical analysis chart.