Just when it looked like the market was ready to fall through some support levels, we get a day like today.  Maybe the US is about to default, but don’t tell the tech industry.  After GOOG got back on track last week, a slew of other tech giants hit homeruns on their earnings calls, including IBM, AAPL, and VMW.  While all interesting stocks to own right now, make sure you play them objectively since it’s easy to fall in love with companies you know and to hold on to them too long after the bubble bursts. 

I have no doubt we’re forming another tech bubble, but don’t get too conservative too early.  It could go on for another year or 2 or 5 and you’d be leaving too much money on the table trying to guess crash beforehand.  Just manage your risk and stay strong with your stops. 

The market still seems to be heading south, but there’s some hope for the future.  Some stalwarts like GOOG and BAC disappointed last week, but with INTC and VMW surprising, we may see techs bounce back sooner rather than later.  A bunch of other big techs will be releasing their earnings soon, including a little company named Apple, so we’ll see how what the feeling is heading into the summer.  Keep a close eye on the top of your watch list since the recent pullback made some enticing entry points on these earnings surprise breakouts.

The market has been in a pretty long uptrend since September 2010.  There was a patchy spot in November, and then a few places that looked like we might pull back, but overall the bulls have passed every test up to this point.  We’re at another iffy spot, but to really claim a downtrend we’d have to fall through $1275.  I stopped out on the last of my long term positions today, but will be ready to jump back in some new things should the market continue its march upwards.  A lot of the stocks that I’ve posted recently are still valid ideas, and the typical long term favorites are also interesting (AAPL, GOOG, AMZN, etc), but I’ll be refreshing the watch list in the near future…

Anyway, the market had some strong volume, but lacked movement.  The telling thing is that GOOG announced some good earnings, but dropped almost 5% in the afterhours trading.  Remember last year when everyone was announcing that they lost money, but they were losing less than the market expected so they were shooting up after the earnings calls?  Well, now we’re doing the opposite, so that could mean this overbought market will finally start cooling off.  Pay close attention to GOOG tomorrow to see if they carry this bearishness through the day.  That could be an indicator of what’s to come over the next month or two.

The volume of the drop today outpaced the breakout that brought us here, so it will be interesting to see what happens.  If the market follows through with its correction, RIMM may be a nice short play.  If not, it should at least be interesting to day trade on some bounce back days.  Either way, all of these stocks are interesting to watch if you like tech stuff for the long run too.

The first stock screen beginning investors implicitly learn is to think about the products and services they really like in their lives and look up whether the companies are public.  Palm happens to be one of those companies for me now after spending some time with a Palm Pre.  If you want a phone that lets you play games and listen to music, the iPhone is probably the only thing you should be looking at.  However, if you’re like me and you want something as a personal organizer, email, messaging, web browser, etc. device, I don’t see how you could live without the multitasking Palm Pre. 

I know I’m abnormal, but I always have at least a few different web pages loading and a couple conversations going on at the same time, which the Pre allows me to do seamlessly.  Surfing the internet on the iPhone feels like going back to pre tabbed browser days.  Is the Pre going to take over the smartphone market?  Probably not — at least not in the immediate future.  As much as the AAPL fanboys will hate me making this comparison, the iPhone is essentially the Windows of cell phones, and the Pre is a little mix of Ubuntu and OS X.  Each have their technical advantages and disadvantages, but if you aren’t leaps and bounds above the competition it’s tough getting people to switch, as Apple has found out in their PC war.  Fortunately for Palm, the turn over on phones is a lot quicker than on computers.

If Apple decides to stay AT&T exclusive, look for this race to get a lot closer much quicker.  Also, pay attention to GOOG’s big surge of Android phones coming later this year, MSFT’s WinMo 7, and RIMM who’s starting to become a bit of a dark horse after dominating the market for so long.  Of these companies, as a trader I would selfishly prefer that PALM or RIMM win the war, since dominating the mobile phone market would make a much smaller impact percentagewise to the bottom lines of any of the other gorillas.  Other companies that are interesting are ARM and Imagination Technologies, since they make the chips that all of the phones are using right now, so any expansion of the market would be good for them.  However, they’re both on the London exchange (ARM has an ADR under ARMH though).  Expect more posts on the subject in the future…

A late market rally sent the markets soaring.  There was solid volume today, but the NYSE ended with slightly more down volume still (46% up vs 50% down).  However, the Nasdaq was overwhelmingly up (87% up vs 13% down) as Ballmer sparked the YHOO merger rumors again, only to have MSFT issue an official statement that they have no interest in YHOO.  After the market close GOOG also delivered an unexpectedly good earnings report that sent the stock up 10% after hours.  I wouldn’t be surprised to see the bounce follow through tomorrow to close out the week, but once again, don’t expect it to last very long.  Will it be enough to get another good short opportunity?

Google continues their domination of the online search and targeted ad market, and it doesn’t seem like they’re going to get knocked off any time soon.  With their recent forays into TV ads and mobile stuff amongst numerous other things, there’s still a lot of room for growth here.  $500 has been a sticking point since 2006, probably largely due to the psychological resistance such a nice round number always produces. 

There are two things you could watch for: a breakout over $500 as shown on the weekly chart or a break of the downward channel as shown on the daily chart.  Currently that would mean breaking $460, but of course that will go down before the time to buy actually comes.  Remember, patience is the key.  Try to catch a falling knife and you’ll get hurt.

After a huge pullback yesterday, the market was mixed in forming a spinning top today.  The most interesting thing that’s happened this week so far has been the explanation over the UAUA drop on Monday.  For those that haven’t been following, UAUA dove from $12 to $3 on Monday after a rumor came out that they were going bankrupt.  It turns out the rumor was traced back to Google’s news crawler finding an old article on a news site about the 2002 UAL bankruptcy filing, and it was supposedly unclear that the article was old so it was posted as current news.  From there it got picked up by other news outlets and the stock was actually closed for trading temporarily after it ate it too much.  Of course once people realized what happened, the stock bounced back most of the way, but it’s still interesting to see how fast the market reacts to news nowadays. 

Some people are mad that automated news traders accentuated the drop (or quite possibly were the entire cause of it), but if you look at anyone that did automatically trade the news I think they learned their lesson.  Let’s see, if you shorted it at $3 you would have had to cover at over $11 when the market opened back up.  That means you lost over 250% in a little over an hour!  Of course that’s from the bottom to the peak, but even half that is a devastating amount for an hours worth of trading.  There are a lot of lessons to be learned from this, but the one I’m going with is: margin can be very painful, so size your positions accordingly.

Akamai is a huge name to anyone that follows internet stuff.  While they don’t have the front facing presence of GOOG or YHOO, chances are you’ve gone to more than a few sites that use them for content delivery without even knowing it.  They just gave their quarterly report after the close and are trading below $26 (down almost 17%) in the after hours due to weak guidance and only meeting expectations.  I’m only showing the weekly chart above, since this is just another one that I want to keep in mind for the distant future if it gets too oversold.  Look for how much support $25 lends in the near term, and then see where this one is when the economy finally turns around (assuming their market position and fundamentals haven’t deteriorated of course).