Don't Get Caught Leaning the Wrong Way

 | Oct 27, 2011 | 10:03 AM EDT  | Comments
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Stock quotes in this article:

ftk

,

tklc

,

mitk

,

wwww

It's very tempting to fade the news this morning, but keep in mind that this market has caught a tremendous number of folks leaning the wrong way. The rally off the annual lows never allowed for aggressive technical buying, and too many bears have been trying to catch a top for a while.

We are seeing a very shallow pullback. Breadth is tremendous, with only 350 stocks in the red. Gold is the only sector that is down.

I anticipate very aggressive dip buying on any pullbacks, so if you are trying the fade trade, don't hesitate to take profits quickly when you have them.

Flotek (FTK), which I mentioned Wednesday, popped nicely this morning and I sold that down a bit. Tekelec (TKLC), my stock of the week, continues to run and I cut it a bit as well. I have my eye on two other favorites, Mitek (MITK) and Web.com (WWWW), but I'm not doing any aggressive buying right now.

Of course, today is the day I return to the hospital to follow up my recent cochlear implant surgery. Hopefully, it won't take too long and I'll be able to check in later.

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