Mr. Market Recalibrating Himself

(Nov. 11, 2018 Weekly Update)

It’s as if there’s a break in the action and Mr. Market is taking a moment to collect himself and gather his wits as of this week, after all the fireworks. He’s been bloodied but remains unbroken. Let’s hop to the weekly updates and charts for each weekly report. As always, we begin with the STOPPED OUT Update and relevant charts - beginning with Stopped Out LONGS and then “SELLS”.

It remains ugly for many ideas - only REGI, EPAY and KS are stopped out with a simple positive notional return. Prominent tickers have been taken out - Match (MTCH) swipes “left”. Micron (MU) has been long gone.

Let’s move forward to the STOPPED OUT SELLS weekly update. Surprisingly many recent new leaders in the market were on the “SELL” list but now they have been stopped out - I refer to consumer staples, like PG and KO as well as media plays.

Let’s move quickly to the Laggards. Here are ideas which could be on their way out as “LONGS” or “SELLS” but haven’t yet hit their stops. Consider this an early warning list of a failing longer time frame trend. This week it’s big names like the Lithium ETF, Petrochina,Reynolds and the Energy Exploration ETF that are on the ropes for now.

The next chart are the Laggard SELLS. Here are ideas which go in the other direction perhaps in 2019. There’s no telling but the best ideas tend to do well relatively “quickly” (as in within a matter of a few weeks) and the following may join the ranks of future LONG ideas next year.

Let’s Jump to the TOP 20 SELLS and then TOP 20 LONGS as of this week. These are the leaders in Rooster360’s trend trading master ideas universe. Sadly, a lot of great biotechs, which had so much promise, have not performed well and we see the continued long march of 20th Century Stalwart General Electric (GE). What might have been.

Let’s move on to the more sunnier list of the TOP 20 LONGS. What a lineup - nothing like the end of Q2/ beginning of Q3 2018. That’s how dramatic Mr. Market’s mood has been. It’s now includes healthcare, financial exchanges, and tech OEMs.

And now for the “New Ideas”, or more accurately, the younger/new ideas which are doing well and may continue to do well. First, the SELLs which have been doing well. I am sanguine about this lineup. This feels more like an avoid list that is best used for shopping in 2019.

And now for the last list, the "New Ideas Longs”, or younger LONGS which have done well. These might be more palatable to trade in or consider keeping on watch. Look for some backing and filling before lining up your books with these ideas.

With any luck, we have been getting ready. More ammo from all those stops leaves us prepared for new opportunities. Discipline keeps us from wasting said resources. Have a great week ahead - I will create more notes to see how we can prepare for Q1 2019.