Market Notes
The dog days of summer have certainly set in as the market drifts lower going into the close. The SPX and DTX both broke significant support levels at 1050 and 410 respectively. Although the Dow Industrials hit 9980, the index is now sitting right at 10,000 major support (half hour before the close). The market internals are on the bearish side and I don’t expect this level to hold.

Potentially market moving economic numbers to watch for tomorrow are consumer sentiment at 9:55 am ET and GDP (gross domestic product) after the market closes at 1:30 pm ET.

Today’s new portfolio
A short portfolio was entered using stocks selected from today’s New Lows list on the *Blue Plate Specials*. The position size is adjusted according to currently total fund holdings which is down from inception. (Initial position size was $1000.)

Today’s portfolio close-out
The short portfolio initiated on 8/11 was closed out today for a gain—yay!

[Construction rules for these portfolios are given in the 4/21/10 blog.]

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Market notes
Late summer malaise has definitely set in. The VIX is back over 25, the bull/bear dividing line. Judging by the opening gap, it sure looks like it’s going to continue upwards which is bad news for the bulls. Pundits are blaming worse than expected housing data, but honestly, with unemployment still high and showing little sign of abatement, banks reluctant to part with a plum nickel, and the end of the housing incentives, the only surprise is that today’s data actually caught people by surprise.

More potential market-moving economic reports are coming up so keep your seatbelts securely fastened. It’s sure to be a bumpy ride!

Today’s new portfolio
A short portfolio was entered using stocks selected from today’s New Lows list on the *Blue Plate Specials*.

Today’s portfolio close-out
The long portfolio initiated on 8/9 was closed out today for another loss. One thing this exercise shows is that even strong stocks will be losers during bear markets—another real-life example of why you can’t buck the trend!

Previous portfolio close-outs
Due to a death in the family (and much thanks to all of you who offered your condolences!) I was unable to blog last week, but I did close out the long 8/2 – 8/5 portfolios as per the 11 day schedule.

Today’s Portfolio Close-out
Today, the 8/6 portfolio was closed out within an hour of the close.

Today’s new short portfolio
Since the market closed below its 40 dma for the third day in a row, a new short portfolio was created out of the five stocks on today’s *Blue Plate Specials* New Lows list. Because the overall fund is running at a loss since inception, portfolio positions have been proportionately reduced. The current maximum position size is $978.

Note that only common stocks (alas!) are selected for these portfolios and only stocks over $5 can be short candidates.

For more info on how this portfolio is generated and how you can construct your own, see the fund rules in the 4/21/10 blog. And remember to do your own due diligence!

Personal Note
Due to a death in my immediate family the *Blue Plate Specials* will be abbreviated, if posted at all, this week. No new *Blue Plate Specials Portfolios* will initiated and the ones that are still being held will be closed as per schedule unless the market moves to the downside in which all of the long portfolios will be liquidated. I am hoping the situation will be returned to normal next week. – Dr. Kris

Today’s Portfolio Close-out
Today’s 7/30 long portfolio was closed out about 45 minutes before the market closed.

For more info on how this portfolio is generated and how you can construct your own, see the fund rules in the 4/21/10 blog. And remember to do your own due diligence!

Market Notes
Here I thought that this morning’s economic data would propel the market in one direction or the other, but not even the upbeat consumer sentiment data could excite investors as the market remained rangebound, virtually unchanged from yesterday’s close. So much for Friday the 13th!

No Portfolio Picks today
Since the market is still trying to decide which way it wants to go, I’m not putting on any positions today. However, if the SPX continues to stay below its 40dma, I’ll enter a short portfolio on Monday and exit the remainder of the long portfolios.

Today’s Portfolio Close-out
Today’s 7/29 long portfolio was closed out about 45 minutes before the market closed. The resulting loss will be subtracted from Monday’s portfolio, divided equally among the portfolio selections.

For more info on how this portfolio is generated and how you can construct your own, see the fund rules in the 4/21/10 blog. And remember to do your own due diligence!

Market Notes
The market still under pressure as investors rotate into commodities, US$, gold/precious metals, and foreign stocks. Tomorrow’s open is chock full of potential market-moving data: CPI (Consumer Price Index), Retail Sales, and Consumer Sentiment.

Tomorrow will be Friday the 13th–I’m almost afraid to get out of bed!

No Portfolio Picks today
Although the market opened down with the SPX still under its 40 dma, the intraday action lacked conviction which makes me think that investors are waiting on tomorrow’s numbers before making their next move. If investors like what they hear and the market rallies, I’ll hang onto the long portfolios and exit the short one; otherwise, those long portfolios will be dumped and a short portfolio will be initiated.

Today’s Portfolio Close-out
Today’s 7/28 long portfolio was closed out about 45 minutes before the market closed. The resulting loss will be subtracted from tomorrow’s portfolio, divided equally among the portfolio selections.

For more info on how this portfolio is generated and how you can construct your own, see the fund rules in the 4/21/10 blog. And remember to do your own due diligence!

Market Notes
The current market scenario reminds me of the Chicken Little mentality: Any whiff of bad news and investors react as if the sky is falling. I dunno…I thought most of the nasty stuff was already priced in but I guess I was wrong…or perhaps, could it be that folks are finally waking up and realizing that the investment paradigm is shifting from a US-centric economy to a global one, and recent jitters are just the growing (groaning?) pains associated with this paradigm expansion?

Just my two cents.

Today’s Portfolio Picks
Because the SPX broke its 40 dma, we initiated a short portfolio instead of a long one. The setup on the short side calls for using half of the funds allocated to the long side. Since the position size remains the same, we’ve selected the five stocks given below to short. They were all selected from the New Lows list and today we certainly had no shortage of viable candidates (alas for the bulls!).
Please note that since we closed out our first portfolio yesterday for a profit, we were able to increase the size of today’s positions (by one-tenth of the excess profits from yesterday per position).

Today’s Portfolio Close-out
Today’s long portfolio was closed out about 45 minutes before the market closed. The resulting loss will be subtracted from tomorrow’s portfolio, divided equally among the portfolio selections.

Tomorrow’s Action
If the market moves down sharply again tomorrow, I’ll be forced to sell the rest of the long portfolios and initiate another short one. If the market moves back over its 40 dma, I’ll sell all of the holdings in the 7/28 long portfolio and either move to the sidelines or initiate a new long portfolio, depending on the strength of the rally. The short portfolio will be covered in the event of a major rally to avoid major losses.

For more info on how this portfolio is generated and how you can construct your own, see the fund rules in the 4/21/10 blog. And remember to do your own due diligence!

Market Notes
The market opened lower on negative economic news (lower productivity—perhaps overextended workers are just getting exhausted?) but perked right back up after the Fed decided to extend its easing policy and buy Treasuries. The euphoria is waning going into the close, though, as market internals weaken. Any rally will need the major averages to break these levels: SPX 1150, DJIA 10750, DTX 460.

Today’s Portfolio Picks
Today’s picks are chosen from the following lists: 5 from Breaking out to new highs, 1 from Breaking out to new highs on lower volume, 2 from Breaking out, 1 from Low-priced leaders, and 1 from Darlings of the day.

Today’s Portfolio Close-out
Today is the first day that a portfolio will be closed out. According to the fund rules (see 4/21 blog), each daily portfolio will be closed at the end of eleven trading days. Today’s portfolio was closed out about 45 minutes before the market closed. The resulting profit will be added to tomorrow’s portfolio, divided equally among the ten selections.

Tomorrow’s Action
Tomorrow I’ll be selling all of the holdings in the 7/27 portfolio.

For more info on how this portfolio is generated and how you can construct your own, see the fund rules in the 4/21/10 blog. And remember to do your own due diligence!

Market Notes
Despite a nice gain, the market was unable to break out of its recent trading range. Perhaps the investment community is waiting on the Fed tomorrow..? Expect more of the same rangebound trading until the Bernanke verdict at 2:15 ET (11:15am PT).

Today’s Portfolio Picks
Today’s picks are chosen from the following lists: 3 from Breaking out to new highs, 2 from Breaking out to new highs on lower volume, 2 from Low-priced leaders, and 3 from Darlings of the day.

Tomorrow’s Action
Tomorrow I’ll be selling all of the holdings in the 7/26 portfolio.

For more info on how this portfolio is generated and how you can construct your own, see the fund rules in the 4/21/10 blog. And remember to do your own due diligence!