Blain’s Nightly Stock Picks, March 17 2008

Posted by Blain Reinkensmeyer
March 17, 2008 at 7:07 pm

Bear Stearns getting bought out at $2 had not only the financials under extreme pressure today but also the rest of the market.

The NASDAQ and S&P 500 both hit new 52 week lows intraday, but closed back above them finishing the day down 1.6% and .9%, respectively. Volume for the S&P was the heaviest its been since January.

Oil today sold off nearly 4% to finish below $105 a barrel. This caused many oil stocks to sell off, and I have several featured tonight.

Meanwhile Gold finished at a new all-time high of just under $1000, but gold stocks had trouble matching its record close. Some of the key names I’ve been closely watching reversed today on heavier volume to finish in the red.

Heading into tomorrow I am still 100% cash, especially with the Fed meeting coming. Playing quick momentum swings intraday continues to be the safest way to make money.

S&P 500 (SPY)

52 week lows tested today for the SPY which is the index ETF that tracks the S&P 500. You can’t see it here but the SPY did close back in its horizontal channel. With the Fed meeting tomorrow though who knows what to expect.

Volatility Index ($VIX)

The volatility index is a tool traders use to help judge when the market might be possibly bottoming. The last move above $36 was when the market bottomed in January, so the movements today into the mid $30s suggest that if the Fed news comes positive then we may be at a short term market bottom.

Bear Stearns (BSC)

For your viewing pleasure, a chart of BSC.

Compania Minas (BVN)

BVN is sticking within its channel for now. BVN reversed to close near its intraday lows on higher volume which suggests a rest could be in store.

GG and AUY are two other gold stocks that also reversed today.

Mosaic (MOS)

Are Fertilizer stocks ready to take another leg down? MOS is just one example with the stock now finding support once again at its 50 day moving average.

Devon Energy (DVN)

Price action today suggests lower prices are to come for DVN. The stock closed below $100 and out of its horizontal channel.

Carrizo Oil & Gas (CRZO)

CRZO has now returned to its original buy point. I would expect the 50 MA to be tested next. This is just one of several US oil & gas exploration plays that could be starting to break down.

Mechel Steel (MTL)

This leading Steel play had a gap down today on higher volume. Channel is holding for now, but I suspect $120 could be tested again soon unless the market makes a turn.

Steel Dynamics (STLD)

Another Steel play, STLD is in the best shape currently out of the several steel stocks I am currently tracking. Lower volume sell off today is natural, but keep stops tight and watch daily volume for any distribution days.

Dry Ships (DRYS)

Could a retest of $50 be in the making? Downward momentum suggests yes.

Transocean (RIG)

RIG has a lot of work to do with a now downtrending 50 MA and the stock testing $130 today. I think the only thing that can save this drilling stock now is a market rally. Buy point is technically with a break out this descending channel.

CSX Group (CSX)

Lastly tonight I have a pretty good looking chart of a rail stock. CSX today announced law suits against two funds and raised its profit guidance. Strong institutional support on the move today past $50.50.