How Low Can You Go?

Welcome to Hawk’s Scan Sentry Report. This is Sunday night June 12th with stock picks for early this week.

In last week’s post we used the Arps Triple Trender to confirm the general market downturn, which turned out to be spot-on. The S&P futures contract dropped another 2.2% throughout the past week to close at 1263.75. In last week’s post we also mentioned that 1245 could be the next significant level of resistance for the S&P; and we still believe that to be the case. Not only are the technical indicators signaling further downward pressure on the indexes, but fundamental factors seem to be suggesting a similar story. With the coming conclusion of the fed’s loose money policies, which have flooded the markets with the cash which has fueled the bullish trend we have been seeing for several years, it seems like the path of least resistance for American stocks is, at this time, probably downward.

Of course, the market does not care about our conclusions or speculations. She couldn’t care less what you or I think, or how we trade. We have to learn to read the market objectively in real time, and not project our preconceptions upon it. Only in that way can we have the possibility of maintaining a lasting and fruitful relationship with these modern financial markets. Therefor, this week we are once again proposing trade possibilities for both long and short positions. Ironically, our long recommendations last week did better than our short ones, with a long VRUS position returning 11.7%. in a bearish market.

So, this week I ran several different tools from Jan Arps’ extensive library of indicators through the TradeStation scanner and found the following trade ideas. Remember, although stock selection is important, sound money management is the most important key to long term success in these financial markets.

Here are the picks…

(Longs) (Shorts)

ZAGG                 PCLN

GFW                   OFC

VHI                    CX

EQT                   FSR

May the trend be with you,

Hawk