Nasdaq And Nasdaq 100 Blast-Off To New Near Seven Year Highs On Higher Volume; Bears Continue To Get Run Over!

October 31, 2007

It was another purely amazingly bullish day with all the indexes closing near their HOD and on higher volume. There is nothing else to say to that except that it was very bullish. The most bullish point of today’s rally was that intraday ahead of the Fed rate announcement the markets swooned right past the early morning lows that was set right after the opening bell. But as soon as it cut to new lows it made a very sharp V-move right back up blowing past the intraday resistance. After a late-day pullback the buying came flying in again thus sending stocks higher into the close. Simply a fantastic day. I don’t say “WOW” often….but WOW!

Breadth was good, new highs were better than lows, my charts look great, and after going through my scans I see TONS of stocks setting up in good bases and have many potential long candidates for you tonight. I simply have not seen this many great looking/moving stocks at one time. This is truly a very unique and amazing period. Enjoy it while it is here!! It doesn’t happen often and we should definitely remember these times. They seem to happen every four years and feel great.

A lot of people were worried that we would sell off after the Fed. This should teach them to listen to their charts instead of the talking dolts on TV. The charts are still green, moving higher on higher volume, and doing so with the Nassy and Nassy 100 hitting new highs. This doesn’t look like its a bear market like Doug Kass says it is. Let me guess? It is an illusion right? The gains in my port aren’t real? It is Halloween. Maybe he is right this time. Or maybe like the other 1000 times he is wrong again. Either way we shouldn’t be scared by the scary bear ghouls out there.

I see some shorting some index ETFs into this great run. I just think that is a foolish move as there is NO reason to fight this powerful trend. Especially with the amount of bearishness top calling amateurs turned commentators I see out there telling me we are topping or are in a recession. Doom and gloom is alive on this Halloween. And the Nassy and Nassy 100 are looking for clarity into the skies. Sometimes, I wish everybody would just follow charts and go with the truth. But if that was the case then I probably couldn’t make a living.

There is no reason to short this market. Continue to stay long your leading and best performing stocks but make sure you are taking profits when they are up 50% to 200%. Don’t hold the whole thing as it moves up. Take some off as it moves higher. You must take some gains on the way up while holding some to make sure you nail the top. There is no reason to sell stocks all out here with all the great chart patterns. I love a lot of my longs like APPY with all the green. I really wish there were more out there and have to be honest am very disappointed that there are not more APPY like stocks out there. Maybe CYBS or NTES will become another one. I also recommend keeping new longs small up here unless the chart is as green as APPY. We are late in this rally and it is probably better to keep new longs small. The top dogs are already too extended and so unless you are long, which means you must stay long here, there is no reason to buy now.

As long as this trend persist up we must remain bullish. It will not be until the distribution days actually lead to a market selling off that we will need to start raising red flags. As long as they hit the market and the markets hold then rally to new highs there is NOTHING to worry about, no matter how often CNN tells you to. The world is NOT coming to an end. Grow up!

I will be back to post some sentiment stuff later on. I apologize for the chat room being down. I think this is like only our second problem so that is a pretty darn good track record. But it is still unacceptable for me. Later on, I hope we have a more reliable system. But for now, this one normally works well. Hopefully, it will be working soon.

Some important sentiment stuff that I want to post before I head out for Halloween is that the bulls came in on the Investors Intelligence survey to 53.8% and the bears rose to 23.1% despite the markets gains. Unfortunately, the put/call ratio dove to .64 signaling that some complacency is coming into the market. Most traders are starting to feel up is the only way to go. However, I am sure two days of selling would throw this baby right back to the 1 level. And that brings me to something I saw on CNBC tonight.

Barton Briggs, a very well respected global strategist, suggested that the current bubble in China is at a similar inflection point like an early 1999 Nasdaq. So by that figure, that means he expects another full year of HUGE China gains. I would not doubt that at all! Also, he mentioned that he expects stocks to rise into the end of the year. You don’t hear that often and the fact that someone as smart as this guy is said it should be of interest to those who think the market is topping. BOO!!!!

I hope everyone has/had a great Halloween. Be safe and if you have kids LET THEM EAT A LOT OF CANDY. This is a great holiday…as long as you stay away from all the freaks who treat it like a religious holiday. Yikes! Aloha and I will see you in the chat room…..maybe????