Wang’s Happy Trading

The market opened higher today on favorable durable goods data. But, soon dropped into the red. However, after lunch, the commodities-related sectors seemed to gain more and more momentum. I, then, commented on the member board:
HappyTrading
Posted May 28, 2008 at 9:47 am | Permalink (Edit)
market
commodities are joining in; we might get a broad market rally this afternoon.

Coal and steel stocks were very strong, as agriculture stocks gained strength also. Oil came back up and the energy stocks started going, as well. I said this weekend in my Sector Watch that “we could see one last burst in USO before it finds the near-term top.”

In the morning, we locked in some more profits on GOOG, with a nice +61% ($7.2 per contract) from yesterday’s buy. We also cashed out on IBM as the market became unstable, which was a “premature move” as IBM went on to finish the day at a new 52-week high! But, we still got a nice +12.5% overnight profit. We also initiated new published trades in MOS and MEE, which were both cashed out at the end of the day for some nice intraday gains of over +30%!

The market ended near its day high with the Dow up +45.68 points, SPX adding +5.49 points, and Nasdaq gaining +5.46 points:

The sectors were pretty much green across the board with accents on commodities: USO (oil) +1.59%, OIH (oil services) +2.81%, UNG (natural gas) +2.01%, XME (metals and mining) +4.21%. MOO (agriculture) rebounded strongly, up +2.06%. FXI (Chinese ADRs) was flat.

SPX

SPX added +5.49 points to close at 1390.84. Its 30-day MA continued to move higher, as its 10-day and 20-day MAs looked to turn up again. The MACD difference (blue bars) went higher.

Nasdaq

Nasdaq gained +5.46 points to close at 2486.7. It closed at its 10-day MA with the daily MAs firmly in their bullish formation. It MACD difference also went higher.

The market was volatile but able to close higher with a strong broad market rally. VIX closed just above 19. If it gets pushed under 19, it would be below its 30-day MA again. Going below 18, VIX should continue its downward trend, which would be very good for the market. Tomorrow, we have the GDP and jobless claims reports. With the market having a late rally and closing strong, it seems like either some bulls have already made up their minds about how they will react, or they got some “priviledged” information about tomorrow’s economic data. Maybe both? I cashed some profits out today before the close, just to be a little on the cautious side. If the market decides to continue the rally tomorrow, it does have a lot of room. So, we’ll be ready.

As mentioned earlier, agriculture stocks rebounded strongly today. MOO was up more than +2%, with CF +10.06%, MOS +7.19%, POT +3.88%, and MON +5.25%. OIH was also strong, up +2.88%. DO and RIG, up +2.86% and +2.93%, respectively, are among the favorites in this sector. NOV, which recently made a new all-time high, was up more than +3%. XME jumped +4.21% and could be setting up for a new breakout! CLF locked in a new all-time, gaining +10.26%; X added nearly +4%; ANR broke out to a new all-time high, yet again, up +9.46%; CNX was up +3.57%; and MEE jumped +5.28%. Solar plays also came back up near the close. If the market continues to rally tomorrow, I think the solar plays are ready to join in.

Good night and HappyTrading! ™