Another shot was fired across the bow of the Internets and tech companies today. Apple, Cisco, Google, HP, Sandisk, and Yahoo were down. Only Ebay was up. Although most of the non-Internet investors are glad to see them possibly get their comeuppance, it doesn't help the market as it removes some speculative enthusiasm. It's better if they just go sideways for a while, like 10 or 20 years.

I think today was mostly a bout of good old-fashioned profit taking, after a string of successive up days. The money is still out there, and it has to find a home. This market is still going higher, but I would concentrate on the beaten-up issues. Those that have done so well are still good holds, but I wouldn't make much of a new fund commitment in them unless the buy was just for a short-term trade.

Remember, we always have to be vigilant, in case our strategy runs into unexpected problems. Stay tuned.

The Market Pro

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It's a positive thing when the market show a good resilience even with varied tech stock news (think Microsoft, EBAY and Yahoo). This market's morale is particularly driven by high-tech stocks, and as long as there is eagerness to bid them up, we won't see big general declines. No doubt that's because technology is America's trump card in world competition. Even with all the outsourcing, innovation is still going strong at the high tech companies based right here in the good old U.S.A.

The other side of the coin is that the "best" high-tech's are too expensive on a P.E. basis, so I would wait for any pull-back in price to buy in. But if you own any, just hold them, because market timing will hurt you.

In the meantime, accumulate cash for a chance to buy in lower. Of course, if your research / information indicates that there is a special situation deserving of your buying in, than do so. Make up your mind and just do it, because in the market, hesitating is no virtue. Stay tuned.

The Market Pro

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I think we'll have to be writing more frequently, as a lot of you folks may be losing your shirts without our wise guidance in these treacherous markets.

When a lot of gas is shared by most of the major indices, it's time to take notice. Even with an occasional exception like the Hi-Tech's in the Nasdaq or when the oil stocks peak up, it's important to know when to pull in the reins.

Say your investment advisor is beating the drums for the Biotech/Genomic stocks. I probably don't have to tell you again to be careful, as you're probably been wounded already by overeager brokers. In these choppy markets, you protect yourself by taking profits where you think the stock is overpriced, and taking losses where you aren't very hopeful about near-term prospects. If that seems too drastic, remember that in that case we always recommend selling one-half, and keeping one-half. Restrict any buying to stocks that you believe have something very special going for them, and the timing of any buy looks right. And don't overpay. As with real estate, a lot of the profit in stocks is in buying right. If you're really concerned, buy nothing and sit tight, accumulating cash. Because we're at that time again where CASH IS KING! Stay tuned.

The Market Pro

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When you see the bout of profit taking in your stock, don't immediately dispair. Did the market make an impressive comeback the next day? If it's impressive enough, then that night you may want to make your shopping list for this morning and get in at the opening, all with market orders. When I want in, I want in, and I don't want to fool around trying to shave a few pennies here or there. Extracting the last fraction belongs to slow-moving markets, which is the last thing you want in a fast moving market.

If the Dow Industrials is powerful, say a 100 point or more gain, then we can work off that. Maybe there might be some mitigating information, like the bad news that advancing issues slightly trailed decliners. But when the good news is great news, say for example, cyclical issues like machinery, metals, and papers making significant gains after many months in the rat-hole, then you can look at the positive. Is this the beginning of market broadening and new leadership, then it will be great news for the market. If it's just a flash in the pan, then the Bull has to live off the billions that are still pouring in. Yes indeed, money makes the heart grow fonder.

Aside from watching the ever-important money flow, we must keep a close eye on the earnings reports which will come in starting now. That will show the direction and strength of this market after the rush of new money subsides. Sometimes a Bull market is off running and snorting, and has a way to go. When that is the case, stay with it, but be watchful for the unexpected. When things are too good, that's when something could come out of left field to spoil the party. Stay tuned.

The Market Pro

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It is very interesting when a variety of stocks in the same sector take gas. Awhile back I noticed that 14 of the 15 Internets I track took gas, ranging from 1/8 to 7 and half points. When these shareholders collectively figured out that they're playing musical chairs and they're short one chair, it got ugly.

What is always important is increasing market breadth. When the Russell 2000 is up over 10 points, which is a tremendous gain for that index, it indicates market breadth. Trying to read breadth on the Dow Industrials may be about as rare as getting two full moons in a single month.

I would still hold the market leaders and would avoid the temptation to sell them at high prices in the hope of buying them cheaper some weeks or months ahead. As previously reviewed, that's too hard to do. It's known as market timing, and not many investors do it very well, as they don't buy back in when they should, either out of greed or fear.

I would commit new funds to mid-cap and smaller issues, providing the earnings outlook and growth story make sense. Stay tuned.

The Market Pro

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Well, I'm sure it's happened to you in this market. Sure, some solid issues move up slowly but surely like Pepsi, Proctor and Gamble, and Pfizer. But more often than not, your stocks go up a point or two, and then go right back down. This is very frustrating, and difficult to deal with.

For the average person, trying to capture a 1-2 point profit should be avoided, as they probably don't have the discipline to sell after a 1-2 point loss. This is a sure way to lose money, as most people will hold their losers all the way down, more than offsetting the sum of their small gains.

Your best approach is to buy quality, like the three stocks noted above. Other good stocks will include Amgen, Disney, General Electric, Hewlett Packard, and Philip Morris. Check these out for yourself, as these do not all pay a dividend

I don't expect the Fed to hike interest rates tomorrow on the 20th. Given that and declining oil prices and a reasonably strong economy, I look forward to a good market from now through year-end, and solid stocks purchased now should be a profitable investment. Good luck, and let's make money!

The Market Pro

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When I think back to my last bout of profit taking I think about the market that made a very impressive comeback. Impressive enough that last night I make my shopping list for the next morning. When I get in at the opening, I do so with market orders. When I want in, I want in, and I don't want to fool around trying to shave a few pennies. Extracting the last fraction belongs to slow-moving markets, which is the last thing this market is.

But when the good news is great news, keep watch. Are hot cyclical issues like machinery, metals, and papers making significant gains after many months in the rat-hole? Is this the beginning of market broadening and new leadership? If so, it will be great news for the market. If it's just a flash in the pan, then the Bull has to live off the billions that are still pouring in. Track how much new money is coming in per day or per week. Yes indeed, money makes the heart grow fonder.

Aside from watching the ever-important money flow, we must keep a close eye on the earnings reports when they start coming in. That will show the direction and strength of this market after the rush of new money subsides. If the Bull is still running and snorting, and has a way to go - then stay with it. But be watchful for the unexpected. When things are too good, that's when something could come out of left field to spoil the party. Stay tuned.

The Market Pro

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