Trading Update: Take Profits On One Of Our Favored Stocks. Accumulate Others Mentioned On List. Lange Financial Services.

[ 0 ] April 19, 2011 |

In discussing the markets this evening with Fred and Rob at Lange Financial Services, please find the the following thoughts below.

VMWARE (VMW) $96.00 [in the after market], one of the stocks on our “Favored Stocks” list, has now advanced about 25% from the March 21, 2011 low.  Earnings reported today of .48 cents per share were well above expectations.  From a trading viewpoint we would take profits. Shares of WMW remain speculatively attractive longer term based on the growth of Cloud Computing.  The company remains on our “Favored Stocks” list.  Keep in mind there are investment risks in the rapidly growing area of cloud computing.  Remember the important statement from Fred Lange: ” There is only one reason you buy a stock and that’s to SELL IT”

Peabody (BTU), Cliffs Natural (CLF), Walters Energy (WLT) and Alpha Natural (ANR) are good quality companies on our “Favored Stocks” list.  The share prices of these companies have declined somewhat recently and are attractive.  We have stated on the blog that we recommend accumulation of these shares during periods of weakness.  We would initiate positions in this area for a portion of the position or make an addition to an earlier commitment.

We remain bullish on the stock market. However, we could see a pullback of up to 3%-5% as the current earnings period ends. The DOW peak one year ago was on April 26th, leading to a three-month correction/consolidation.  This set up the July/August lows last year when we became extremely bullish on the markets as discussed here on the blog back then. If a pullback does occur, we would also add to or accumulate new positions from stocks on our “Favored Stocks” list. The IMPORTANT GOAL is to develop a good AVERAGE PRICE onyour overall position..


 

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Category: Markets and Trading