Saturday, January 31, 2015

Santa Monica CANSLIM meetup 1/28/15

Agenda for the meeting:
1) Current Market Outlook--Alex Marenco, former portfolio manager for O'Neil Data Systems, Inc.
2) TBA Lesson--Amy Smith, KRLA radio co-host, & Irusha Peiris, MarketSmith product coach.
3) Review of Watch List stocks submitted by members--Alex Marenco.
4) Ten stocks near a buy point from Alex Marenco's Watch List.

Meeting is sponsored by Investors Business Daily. For those that are not familiar with the CANSLIM method, the book it How to Make Money in Stocks. It focuses on high growth stocks with positive chart momentum. For those looking for my weekly report, it is the next post.

It is standing room only at the Santa Monica stock market meetup. I arrive fifteen minutes later and get one of the last chairs. They do bring out more chairs, but it is elbow to elbow. I sit next to a guy that tags himself as "the bear in the room." He rattles off a litany of doom and gloom that would frighten anyone away from the stock market. Surprisingly, later during the meeting he raises his hand for owning BABA.

Overall thoughts: a lot of very smart people presenting. The meeting is fast moving, covers a lot of stocks. Two that I added to my watch list are UA Under Armour and NXPI a semiconductor stock. I always tell people at the meetup that I am not strictly a CANSLIM trader, but I do use some information, some ideas that I get and incorporate it into my own trading style.

Market Outlook is choppy. There have been five signals changes before the Jan 28 meetup. There were 21 all of 2014, so it is getting choppier. The bull market is long in the tooth. A comment is made that a 20% bear market would be a good way to clean everything out. My thought is that it is like an overgrown forest and there is fire. Then new stock leaders can rise from the clearing.

They ask for a show of hands "who is making money in this market?" Only one hand goes up. Later, they ask how many still own BABA and maybe six hands go up in a room of 50. Earnings for BABA came out the next morning and there were at least six unhappy people as it went down about 10% on the report.

The meetup was on the day of the Fed meeting ending and the market was down hard. The Fed is talking about raising rates in June or July. However, if the stock market careens lower, they may put that on hold, and may even do another round of QE.

A question from the audience is about Europe, specifically Russia. One portfolio guy says he doesn't look at Europe at all, the other says he only looks at EWG, the German stock etf. Another theory fromo the audience is about the broad stock market decline being related to margin calls in the oil futures. It is possible, but it is difficult to make this cause and effect.

A few of my own market thoughts: the broad indices were down about 3% for January 2015. I looked up similar events in the Stock Market Almanac. Mostly it is slightly down, slightly up years when January starts like that. If forced to a number, I'd say -5% for 2015, or -2% from here. A lot of money continues to pour into oil stock ETFs. To me that means lower lows in oil and oil stocks are highly likely.

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