Tue 10/16/2007

Market recap:
- 3rd distribution day for Naz in 4 days. (http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=0&mn=10&dy=0&id=p08818831986&a=113465205)
- 3rd distribution day for S&P500 in 4 days: http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=1&mn=10&dy=0&id=p79814239758&a=113465207
- 3rd distribition day for Dow in 4 days.:http://stockcharts.com/h-sc/ui?s=$INDU&p=D&yr=0&mn=10&dy=0&id=p83964438438&a=113465208

Market in pullback and consolidation mode. Possible lows of this pullback:
Dow: 13700
Naz: 2730
SP: 1525

Strategy:
Position trading: Focus on leaders showing outstanding relative strength during the sharp sell-offs in the last few days. Buy long term calls at close to suppot/intraday lows. Trades entered incude AAPL, BCSI and FWLT

Quick swing trading: capture 1-2 day bounces of leaders off 20MA.

Picks:
Leaders in strong consolidations mode:
- AAPL(http://stockcharts.com/h-sc/ui?s=AAPL&p=D&yr=0&mn=10&dy=0&id=p60576500452&a=112920478)
- BCSI(http://stockcharts.com/h-sc/ui?s=BCSI&p=D&yr=0&mn=10&dy=0&id=p87738985585&a=119053168)
- FWLT(http://stockcharts.com/h-sc/ui?s=FWLT&p=D&yr=0&mn=10&dy=0&id=p82124421065&a=119497196)

Leaders pulling back to/at 9MA, 20MA or major support lines:
- VMW(http://stockcharts.com/h-sc/ui?s=VMW&p=D&yr=0&mn=10&dy=0&id=p87738985585&a=119493608)
- ICE(http://stockcharts.com/h-sc/ui?s=ICE&p=D&yr=0&mn=10&dy=0&id=p82124421065&a=119172271)
- CYNO(http://stockcharts.com/h-sc/ui?s=CYNO&p=D&yr=1&mn=0&dy=0&id=p12140599933&a=119064893)
- CMI(http://stockcharts.com/h-sc/ui?s=CMI&p=D&yr=0&mn=10&dy=0&id=p19297918836&a=119054837)

Current holdings:
1. AAPL. Stocks, Nov and Jan calls.
2. BCSI. Nov and Jan calls.
3. VMW. Stocks.
4. FWLT. Jan calls.
5. ICE. Jan calls.
6. CMI. Nov calls.