Welcome to the weekend, friends and fellow traders. Man, it seems like forever since we've just had a chance to sit back and talk about the market's bigger picture. We started this week with an introduction of Biotricity (BTCY), then on Tuesday Double Crown Resources (DDCC) confirmed it was starting to deliver on a huge gold order -- a big deal for the company -- which was followed on Wednesday by news that Sack Lunch Productions (SAKL) had already booked $10 million worth of business this year... about how much revenue in generated in ALL of 2015. Then yesterday we finally got to tell you about Pressure BioSciences (PBIO), which is on the verge of a revenue explosion thanks to a new product and new partnership.
We're not complaining, of course. These are all great companies, and the news did SAKL and DDCC some good. Meanwhile, PBIO and BTCY were both rather well received. (If you missed any of those newsletters, links to all of them are in today's first paragraph. If you have any interest in small caps at all, a review would be time well spent.) We're just saying a lot's happened since we've had a chance to talk about the market. We'll try and catch up today...
... though not without one quick update about one of the aforementioned stocks.
You may have seen it already, but if not, the 2320EXT mass spectrometry prep device Pressure BioSciences was going to start selling in the latter half of the year is no longer a "going to." Now the company IS selling them. Five have already been ordered, and one's already been shipped.
Bryan Murphy served up some information and thoughts about the news, but perhaps just as important, he made a great point about how PBIO shares are knocking on the door of a breakout move. Like him, we think once the story starts to spread and reach a critical mass, it could become explosively bullish.
Speaking of our Featured Stocks, I just want to show you a chart of Double Crown.
No major discussion needed. Just take a look at the way DDCC shares have started to build a base around $0.145, which up until Tuesday had been a resistance level. The longer it treads water at or above that line, the stronger the foundation becomes.
We just wanted to plant the seeds for this discussion at a later date, because it's sure to come up.
As for the market, well, what can we say? Intelligent or not, the rally's insane resilience is impressive. I still have my doubts it can continue higher from here without a pretty good corrective move in the meantime, but I think I've been saying it for a few days now. So far, nothing. Maybe I'm too much of a pessimist. Then again, if I'm reading something John Monroe wrote to Elite Opportunity Pro members today the right way , maybe I'm not.
Not to wax too philosophical here, but market tops tend not to materialize until most everyone thinks the market can't do anything but go up. I thought that time came a few days ago, but the more I think about it, we really haven't reached that last "I have to go all in" moment yet for traders. We're close, but not quite there yet.
So when will we get there? That's where John comes in. This is part of what he said to EO Pro members today:
"However, now that the NASDAQ has achieved [removed by editor], even though the S&P 500 hasn't quite achieved [removed by editor],yet, it's obviously time to either pull the plug on those, or even better move your SSL's [stop losses] way up to protect some very nice gains there. That should have been common sense yesterday considering we called for a pullback once the NASDAQ achieved that [removed by editor] level.
So what now? This is where things become very compelling for us. Next week we enter a big earnings week, and considering it's many of those big tech bellwethers set to report, if the major indices continue to pull back over the next few days, the potential pullback could be temporary. However, the key here will be how they behave by week's end....
...because now that all of the major indices have achieved very logical tops, which are represented by various technical expansion levels, as well as some fairly firm resistance levels, if for some reason all of our previously published targets are now breached to the upside, the markets will have every technical reason to continue their melt-ups."
You see what he's saying there? Sorry I had remove the numerical data and a bunch of the analysis from the comments, but we have to protect paying members of the Elite Opportunity service. Even so, you can still glean that the market as a whole hasn't reached key psychological pivot points yet. Well, the NASDAQ has, but the S&P 500 hasn't. Both are close though. In fact, both may have been close enough to count them as reaching a critical top. Makes sense. Investors weren't having that "I'm going to miss out" moment a few days ago. With the recent move to the retracement/expansion levels John was talking about though, the key psychological tipping point is close.
If you'd like to get the details of John's analysis in real-time, become a member of the EO Pro. Worth every penny.
Along those same lines, I also thought something James Brumley showed his The Future Investor subscribers today was interesting.
As was the case with Monroe's comments, I'm only going to give you a look at the chart and just a quick explanation -- I can't give the whole discussion away. Still, James told me to show it to you guys with his blessing.
The chart below from top to bottom is (1) the S&P 500, (2) the NYSE's advancer/decliner trend, and (3) the NYSE's up-volume/down-volume trend. The gist is, breadth and depth have been quietly turning bearish, meaning the bullish volume as well as the number of advancers has been shrinking the higher the market goes. The bulls are dropping out.
I'll also tell you James has created a short-term trading system using the idea of comparing bullish breadth and depth to bearish breadth and depth, and the results are pretty impressive. Though TFI is meant for long-term investors, he uses the system to hedge against short-term pullbacks to soften the blow in his long-term trades. It's really a rather savvy way to manage a long-term portfolio, picking up the market's nickels and dimes when it drops them (and letting you stay in your long-term trades without being afraid of a little volatility.
That's all for today, and the week, folks. We'll catch you on the other side of the weekend. Have a good one.