Wall Street Stampede

... Stampede of stock buyers that is.

The Dow has the biggest single-day gain in eight weeks, and the "Best Bullish Day of Year on NASDAQ since April 2003"...

You don't say?!

These are the new headlines in the media suddenly today... Just yesterday, the media exclaimed investors should be extremely concerned about the future direction of the stock market, and furthermore confirmed a market crash and a recession is now imminent (... they forgot to add the end of the world is near and there's a sale at Macy's!)

For some perspective on the latest stock market action, the chart below presents the FACTS -- The current trend of the S&P 500. The recent decline in the S&P 500 has been relatively sharp, BUT the S&P 500 remains within its five-year trend channel, and support (green line) is being tested.

Where we will go from here is not clear yet. BUT the fact is the DOW was up +320 points today alone on high volume, and that said we'll go out on a limb and state we believe to be another day away (further) from the upcoming Stock Market Crash! ... (To see what a real Bear Market looks like, simply look at the time period from 2000-2003 in the chart below). Nothing has changed since June 2007 of this year, when the financials met Pandora's Box for the first time.

For now, we prefer to call this simply a time of ... "froth removal from the party punch bowl"... or if you prefer, a pre-Christmas house cleaning before Grandma and the reindeer come home for the end of 2007 year holiday market rally -- hopefully to empty the rest of the punch bowl.

And if the facts are just too plain boring and you prefer dark drama instead of "what ifs", then we recommend the following 11/12/07 dissertation by Bill Fleckenstein a good read. Like a good ole generic Hollywood thriller, how can one simply pass up reading a blockbuster title like, "The Stage is set for a stock crash".

Too bad this article wasn't published on Halloween!

... Can you go short on Pop Corn?

DJT Portfolio Surges Above +25% Gains

... Goldman Sachs Offsets Wall Street Worries and our DJT Portfolio surges upwards above +25% gains year to date once again.

(See below for complete portfolio positions)

Note: Given the recent rally in the financial stocks from their lows last week, we have not sold off our positions in C and AIG. Interesting to note also, AXP has resurfaced in the black and we have gains somewhat once again. Stay tuned for any updates.

Stock Market Gyrating Machine Eating Our ...

... Gains.

It seems there was no place to hide this past week unless you were invested in .... not sure really, I have to research that!

Markets are gyrating with greater force as buyers and sellers attempt to digest rising oil prices, a weak dollar, and consumer sentiment more pessimistic than it's been in years. Meanwhile, Federal Reserve Chairman Ben Bernanke says the centralbank is concerned about both inflation and recession. Stock market volatility is nothing new, but we all seem to forget when euphoric new highs are being formed and everyone is practically falling over themselves by the party punch-bowl.

As of yesterday (Friday) the Dean Jones Trader Portfolio (DJT) was no exception in becoming another victim to the mad Wall Street free-fall. Just one month ago we were sitting on +28% gains for the year. Today we are fortunate our DJT remains up +21% based on realized gains established in the first half of the year.

Thanks mainly to our premature financial positions we eagerly established back in October with Citigroup (C), and American International Group (AIG), (which seemed to have formed a short term base at the time and a buying opportunity), it further proves you simply have to cut your losses no matter what. In a (DJT) back-study over time, it became evident that using a -6% "sell rule" seems to be the threshold in keeping gains in tact and losers out from possibly further deteriorating a portfolio.

That said, come Monday the following stocks would need to be SOLD:

AIG
C
DIS
GE

(Side Note: Plain sloppiness or lack of time, is no excuse for mediocre management of what should be a fine tuned stock portfolio, but I personally have a darn good excuse for being M.I.A. in the last few weeks -- negotiating the purchase for a new California home at -30% below last year's selling price, is quite the dramatic event in this sub-prime age of frenzy. Now that's a whole other market and story for other blogs to rationalize!)

In the last post we established a BUY in Wal-Mart Stores (WMT), which by the way never made it in our overall portfolio screen shot(!) since it was SOLD within 10 days following a quick reversal and downtrend.

Last month we also increased our BUY position in Altria Group (MO), (which I still prefer to call Philip Morris, or as the Street calls them; 'Big -MO'). The stock is clearly enjoying support in this time of market turmoil, as it is a defensive play and best of all, it also pays a fat dividend to boot.

(... or is it P-H-A-T?!)