Stand Back or Get Trampled

CLRK was on a bit of a pullback from the tear it went on yesterday. So after a run like that there’s two directions a stock can go; up or down. In today’s case it looks like some people decided to take their profits. The other thing that could happen is that the shorts get caught off guard and then rush in to cover their positions, driving the stock higher. My guess is that there aren’t a lot of short positions out on this stock so there was no covering to push the stock higher. The result if that the profit takers won out on the day. Maybe CLRK can get some analyst coverage over the next couple of days. Hahaha.

SCUR looks to be starting another trip towards $7.00 so we won’t cut it loose just yet. My guess is that it will make a third attempt to stick over $7.00. If it doesn’t then it will surely come down in a hurry so we must be ready for that. When we see the inability to stay above $7.00 we want to make sure that we’re in the front portion of the pack as they head for the exits.

Looks like the Dow is really moving and 12,000 is now in sight. It isn’t unrealistic to see the Dow over 12,000 by Friday. This morning it didn’t look like it was going to be much of a day until we got some news on oil inventories, the economy and treasury yields started to fall. Funny how a slowdown is now beginning to be seen as a good thing. What that means to the market is that the Fed is done raising rates and they might possibly start thinking about lowering rates.

Now with the Dow hitting new records, my take is that the general public will now start to pile into the market either on their own or through mutual funds. Investors see new records as people making easy money and greed kicks in. They see other peoples’ wealth increasing and they want to increase theirs as well so in they pile.

Even though I still see the foundation of this rally as shaky, I can’t ignore the rush of money that will now flow into the market. All this means is that the institutional players will make more money as the public drives the market higher. Short term players must guard against the institutional guys taking their money off the table and sinking the market. Longer term people may want to take some profit and buy back at a lower price.

Easier said then done.