May was better than April, hows about June then?
06/01/2004
Oil, oil everywhere, and not a drop to burn. What do you reckon, Shell are not the only ones to get their reserves wrong. Do you think the Saudis might have too? Well, I am short black gold. Suppose F16 jets and tanks are more costly to run now. Well, the tax bill's just gone up then.
As I scan through the FTSE 100 stocks, what is intriguing is the number of stocks showing positive upward biases and signals. Hmmm...doesn't make fundamental sense so it must be a pure momentum play - higher risk, but greater reward too.
May was certainly easier to trade than April. The problem with April was a complete lack of direction. If, like me, you are a short term momentum trader looking for short-term trends, then a month like April if pretty tough going - you spend a lot of time, effort and money on getting nowhere.
Okay, so if May was better, what about June. I prefer in the often quieter months to have a medium and short term list of market plays. The reasoning is simple; if the market is going nowhere in the near term then at least my time and effort is not wasted.
We're certainly seeing a series of FTSE 100 companies start to show trends higher now that the sideways moves are out. Land Securities for instance.
Hilton Group too shows a similar rise after recent dips. ICI is another. Others in the group include Boots, Royal and Sun too as well as Enterprise Inns and Whitbread and British Land.
These are all showing up on my short term indicators as ones to investigate further. My view is to keep a tight stop. If am right, then they should not break the tight stop which should be on the other side of recent price support.
With Hilton Group, if I am correct we should not see the price touch 250p so that can be a stop loss level. A target of 290-300p is the objective.
For ICI 191p should not be visited and a target of 230p, which is nearby resistance makes sense.
Money
Also with these it is worth ensuring that the potential upside is double the downside stop loss.
Value-Growth
Okay, what about my value-growth radar - the stocks I scan to see which are showing both value based on a number of proprietary measures I have and also growth based on revenue and earnings and other measures I have.
It's those housebuilders again. After falling in April and May they are showing some upward moves now: Bellway, Barratt, Bovis and Persimmon. Chemring is up there too.
Don't forget you can get my new CDROMs on 'How To Invest Better' from the ADVFN bookstore under 'Alpesh' in the search engine.
Crazy Small Stock
In this regular part I explore some of the riskier stock plays. Why? Well a lot of readers are fed up of boring, safe and conventional and want some action. So, buckle up - here goes: Mercury Recycling, Oystertec, Aurum Mining.
All pure adrenalin momentum plays.
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