Watch list for tomorrow, 3/30/99:
About 15 stocks showed up today. Only five buys survived the net screening gauntlet. Here they are, with net-generated entrance stops:
ALA. Go long at the higher of the two: open + 0.434 or 23.126
TDFX. Open + 0.341 / 11.625
NVLS. Open + 0.403 / 54.002
TXT. Open + 0.186 / 77.376
VRTY. Open + 0.279 / 34.255
Well, the markets finally closed above 10,000 and the CNBC people were finally able to dust off their party hats. What caused all this buying? Well, it all depends on which talking head you like to listen to, but the most likely explanation is probably end of quarter window dressing by cash-overloaded fund managers, compounded by a relief rally as we leave earnings warning season.
Needless to say, funds are like big elephants, once they start moving cash out of the coffers, they don't suddenly stop and reverse direction. I expect the buying to continue, probably not as intensely as we finish off the month, meaning more new highs and more bullish scenarios from the usual suits on CNBC.
However, keep in mind that the volume problem still continues to haunt the market, the VIX is approaching overbought terroritory, and despite what CNBC says, market breadth is still not all that hot. We're also entering early April, a notorious correction period for the market (and if you hadn't noticed, this market has been following historical trends to a T) as funds are shifted to pay off the IRS. And for you astro-voodoo traders out there, note that March 31st will be a full moon. Historically, that means short the major market indicies.
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