Daily Picks

It's time to pick up some over-sold/defensive stocks and short some high runing speculative stocks.

Although mortgage turmoil seems to be widening, E-Trade is the recent victim of CDO short falls. But Citibank is over-sold, so I am re-iterating buy recommendation for WCG and issue a buy recommendation for C:

Long: WCG and C

At the same time, I am using my spreadsheet scan through the past "Super Stars" and discovered that MICC, POT are breaking down.

Short: MICC POT

Market Swimmer

COT Report, Guru View

Source: U.S. Commodity Futures Trading Commission (WWW.cftc.gov)

Index	Trader Group	11/2/2007	11/9/2007	Difference
Dow	Commercials	-177	-1093	-916
Nasdaq	Commercials	5885	6050	165
S&P 500	Commercials	51694	46398	-5296
Russ	Commercials	3427	4754	1327
VIX	Commercials	-4304	119	4423

In last week, Commercial traders sold off S&P and Dow, but increased holdings on Russell index slightly. They also bought heavily on the VIX - Volatility index, expecting tough time ahead. After testing support for several days, the stock-market indexes finally broke-down below critical support levels.

Monday morning crash talk is in the air, but the market gods have denied that event through every other opportunity in the last 20 years. Of course, anything could happen because this is easily the worst price action since the summer of 2002.

In short term, the market has been severely over-sold, but it's time to exercise caution!

Hope the best for all,

Market Swimmer

The New Site is Up!

Sorry, my new blog site has been down for one day or two, a long story. But now it's up and running again.

The new site, www.marketswimmer.com was "hard wired" to another domain which I purchased sometime ago. Recently I got a letter saying my domain needed renewal, unsuspecting me paid $25 for that. Unfortunately I have been scammed! Last Thurday, I found out my website has been locked, I was in panic because I don't want my views not being able to access my blog. I called Yahoo - my web hosting company - only to find out that I don't need to pay any renewal, my web hosting monthly charge includes domain renewal and automatically renew every year. At the same time, the scammer send me email, asking me to unlock my domain so that they can get control of my domain.

The name of the company is "Liberty Names of America", be careful everybody! Don't respond to any letter or email from any company you don't have any business association with.

Jim Boykin's Blog gives a good account of Liberty Names's scam:

http://www.jimboykin.com/liberty-names-of-america/

By the way, I contacted the Best Business Bureau, made complaint, called my credit card company, put a dispute on the charge, called the scam artist company and got back my credit.

For the rebuilt MarketSwimmer site, things should be better. Previously I could not use back button on IE, it should work now. Will be a lot of improvement. I will move some of comments into the new site.

Thank you and enjoy,

Market Swimmer

Alibaba's IPO in Hong Kong

Alibaba looks to be world's 2nd largest Internet IPO

Alibaba.com kicked off the road show of its IPO yesterday. Its indicative IPO prices ranged from 10 to 12 Hong Kong dollars. Based on such calculations, Alibaba's IPO will raise 10.31 billion Hong Kong dollars, beating the expected 7.8 billion Hong Kong dollars and making it the largest IPO by a Chinese Internet company.

In 2003, Google was listed on the NASDAQ, raising 1.67 US dollars (about 13.026 Hong Kong dollars). Alibaba will hopefully become the world second largest Internet IPO. It will also become the largest in Hong Kong, replacing the record set by Tencent（0700.HK), which raised 1.55 billion Hong Kong dollars.

There were strong demands for the shares of Alibaba.com. Following Yahoo.com and Guo Taiming of Honhai Precision Industry, it acquired another five new investors: Industrial and Commercial Bank of China, Wharf president Wu Guangzheng, Guo Henian of Kerry Group Limited, families of Sun Hung Kai Properties, and American International Group, Inc. (AIG) .

Chairman of Mengniu Group Niu Gensheng and Secretary of the Bo'ao Forum for Asia Long Yongtu will act as the independent directors of Alibaba.com.

For more details, please read the full story in Chinese (http://www.dfdaily.com/node2/node27/node120/userobject1ai33236.shtml).

Guru View

Introducing the new blogger site: www.marketswimmer.com

** US Dollar

The US Dollar continues its 'relentless' decline. While there
are no signs of a bottom on the price-chart, the COT chart
is not any less bearish. Commercial position has been
declining marginally, but declining never the less for the last
5 consecutive days. Commercials typically like to buy when
prices fall. Well, the USD has been clearly falling, and
commercials are NOT buying.
In other words, the outlook for the USD continues to
remain bearish from a price/COT chart perspective.

** Stock Market

DIA - Stockcharts chart
After Thursday's sell-off: the markets reversed on
Friday after bottoming near key support levels:
Dow Jones - 13400
S&P 500 - 1490
Russell 2000 - 790

If we hold above these levels in the coming weeks, one
may argue that a short-term bottom is in place and we
are headed back up to test overhead resistance.

From the COT charts, not much has changed. The S&P
500 & Dow Jones charts look constructive. While the
Russell 2000 & Nasdaq 100 charts look bearish.
As for the Nasdaq 100 chart specifically, there was some
evidence last week of commercial buying, nothing major
but worth keeping an eye on.

** Gold & Oil

Gold & Oil have had stellar performances with their trends
still pointing UP. As for GOLD, its COT chart remains
bearish, so be mindful of price break-downs. Oil's COT
chart is more constructive than that of gold's, as net-
commercial position remains well above 2007-lows.
However, as with any sizable rally, the time to be bullish
was probably 5-6 months ago. As for right now, down-side
risk, in my opinion, outweighs reward.

CHART:
USO - Stockcharts chart
Keep an eye on oil's price-chart, there is evidence of an
accelerating (parabolic) trend. It is probably not wise to
get in its way, but once a top IS in place, a steep correction
and/or a consolidation period are very likely.

Swimmer's New Blog Site

Introducing the new blogger site: www.marketswimmer.com

Thanks for visiting my blog. In order to serve you better I created a new blog site at www.marketswimmer.com. Taking an advice from one of our visitors, I created this new site by using the permanent web address and a much better blog publishing software - WordPress! I have tried hard to move everything from this site to the new site; including posts, comments and so on... Please take a look, if I missed anything, please let me know.

The new publishing environment offers a lot of enhanced capabilities such as multi-page publishing and three-column design. Some of the features may not be obvious for now, but several things should start catching your eyes from now on:

One thing makes tremendous difference is the multi-paging style, which enable me to separate informational contents. For instance, now I can create a page titled as "Daily Picks", with which you don't have to browse through all the pages in order to find the newest picks, you can find my picks in the same location every time, all the times.

Also, WordPress is such a popular blog publishing tool that we have a large variety of themes and plug-ins to choose from. In particular, I like the 3-column design and the calendar on the right side bar very much. With the calender, you can see which day I published posts and which day I didn't; finding an old post is just as simple as flipping through calender pages and clicking on the dates!

I will add pod-casting/video and trader training courses on the web pages, and the beautiful thing is that they are totally free!

As the web building process takes a while to complete, for a period of time I will simultaneously publish on both locations. I do prefer you make your comments on the new site because they have much better comment managing system. I won't moderate the comments in anyway, it's just so much easier for me to see all the comments at the same time and reply them more quickly.

On the new "Contact" page, you can send me your feedback with confidence because it's designed to protect you from the hackers and spamers alike. For instance, your message and address will never be exposed. It also has a function trying to identify you as a human or "robot", as long as you answer a math question correctly, your message can go through. When you click the send button, your message and email address will go directly to my server, so nobody can grab your "real" email address and send you spam!

The new template also have impressive graphics; the theme, header graph and color can be changed as easy as a few key strokes. I will move all the goodies from here to there, at the meantime I suggest you go there and take a look. Any comments and suggestions are welcome.

Best of luck to you all!

Market Swimmer

Guru View

**

The stock market has reversed after first testing new
highs (for the week) on Wednesday following the FED
decision - only to dramatically sell-off on Thursday
violating short-term support.
This breakdown in price is starting to confirm the
bearish COT charts of the Nasdaq 100 and Russell
2000.

It looks like we are headed for a test of last week's
reaction-lows. Here are the support levels:
Dow Jones- 13,400 | 134 for the DIA etf
Russell 2000- 790 | 78.5 for the IWM etf
S&P 500- 1,490 | 149 for the SPY etf
NASD 100- 2125 | 52 for QQQQ etf

Even though it declined for the day, the Nasdaq-100 price
chart continues to look the most constructive out of all the
indexes. The intermediate trend remains UP unless we
start to break below critical support at around 2125.

If the above support levels are taken out, the US stock
market is going to start to paint a bearish trend. Consider
the breakdowns in financial companies such as Citibank.
Also keep in mind that the Russell 2000 closed below 800
today. Last time that happened, the RUT reversed in the
very next session - to the upside. We'll see if the bulls
show up this time around...