Oversold stocks

cybercash28 · Mar 11, 2009

I have been doing well when purchase stocks with good fundamentals and are way way oversold. A few of the that I posted here before are :

NVDA ATVI SYNA ISRG

Look at the charts and each stock has its own rsi for being oversold. I purchased CSCO MSFT FWLT JOYG al most at the bottom.

When rsi is below 30 is really oversold. Look at FWLT, very nice entry at below 30.

The ones that I really like now are:

ABT
CEPH
X
ENER
GMXR watch this one closely, way way oversold

total_keops · Mar 11, 2009

What is the time frame that you look at and for what kind of timeframe you think to hold?

cybercash28 · Mar 11, 2009

When a stock is way oversold, I purchase shares and follow until it gets to key resistance or show sign of weakness.

Move your stop loss as it moves higher to save profit. I sell at key resistance when profit is good.

How do you feel if you get in RIM at $35 or so. $42.50 or so is next resistance unless news, market goes up or down in a big way then ma-50 or back to $45 again. This is just an example.

KINGOFSHORTS · Mar 11, 2009

I think GE. Although it could see 5's again. But then again if your horizon is 25 years and GE survives this aftermath it would be an interesting ride.

Bob111 · Mar 11, 2009

way way oversold

Quote from total_keops:

What is the time frame that you look at and for what kind of timeframe you think to hold?

kinda agree....this thread make no sense without clear definitions of way way oversold and time frame to hold or exit..QQQQ is way oversold at the end of 2000..so what?

I purchased CSCO MSFT FWLT JOYG al most at the bottom.

how do you know that this is the bottom?
it could be for few days...

look at QQQQ example above...

KINGOFSHORTS · Mar 11, 2009

IF you bought the Nasdaq stocks in 1980 last bear market (29 years later) You would still be up an average of 925%

S&P 1980

29 years later you would be up 552% and this excludes the dividends.

Now most folks think 10 years is longterm. It is not for equity.

25+ is long term

The best money made is buying during bear markets and holding over a long period.

I do think the last two bull markets were abnormalities and were above the average and now the markets are correcting to the historical levels of growth.

The market grew too fast to unrealistic price levels between 1995 and 2000 and between 2003-2007.

It just took a long time for a proper price discovery but the markets are heading to more realistic levels.

The good news buy cheap and build a portfolio you can sell calls and collect extra income in addition to dividends etc..

And remember longterm is 25 years or more

Bob111 · Mar 11, 2009

The best money made is buying during bear markets and holding over a long period.

true..if you know where the bottom is..or ..if you assume that the stock market always go up...or at least it's go up at some point before you die...you are on same line with "advisers" from money magazine, where everything is made on assumption that average stock market return is about 8%-10% a year...yeah..right..good luck with that..

KINGOFSHORTS · Mar 12, 2009

Quote from Bob111:

true..if you know where the bottom is..or ..if you assume that the stock market always go up...or at least it's go up at some point before you die...you are on same line with "advisers" from money magazine, where everything is made on assumption that average stock market return is about 8%-10% a year...yeah..right..good luck with that..

But long term stocks are ownership in a company. Too many people (The majority) just dump money into some fund and never pays attention to it.

Would you just drive a car of the deal and never keep up with maintenance or put fuel to keep the car going etc?? You need to maintain your portfolio and manage it.

You can do things like write calls to collect income on your holdings , insure against losses via puts if you wish etc.. obviously these things need to be managed.

Short to midterm I am bearish, long term I am bullish I guess you could say I think there is a contango situation with stocks

My long term portfolio is down but I am fine, I am collecting some nice covered call premiums that I am putting aside and using to buy into opportunities as they arrive, and closing out my puts and saving the proceeds as well. Infact I would be just as happy if stocks stay rangebound and VIX high, I will just keep on cashing in.

Do I care what the mark to market value is today, no because I am generating cash flow, converting marketfear into money.

Funny how you never hear talk about writing calls or buying puts on those Money Magazines etc..

SCI new york · Mar 12, 2009

Quote from KINGOFSHORTS:

I think GE. Although it could see 5's again. But then again if your horizon is 25 years and GE survives this aftermath it would be an interesting ride.

based on what information? Outside of the improbability of the DOW going to 2000, why would GE trade at $5

cybercash28 · Mar 12, 2009

I purchased CSCO MSFT FWLT JOYG al most at the bottom.

Most of us are day/swing traders so the time frame I meant was short term, very short.

TA helps us to be in&out and maximize the profits. Understand fundamental is very important because it helps us to buy oversold stocks and have confidence that they will come back (Swing).