The Cutting Room: A Great Show Follows an Exciting Week

Boy, what a great show. At least it was from my perspective, sitting in the heart of America's Capitol. I don't know if you agree, but from my chair, everyone just seemed to be "on." The topics discussed were all relevant, and everyone seemed really fresh. Here's how I saw it ...

As background, this was a fun night for me. Diana was having two of her friends sleep over, so to make it a great evening, I took them all down to D.C., and arranged for them to tour the Fox News studio. They enjoyed the little walk around, but frankly, loved the free sodas even better. Still, there's nothing like three 10-year-olds having fun to put this guy in a good mood.

The show opened with Word on the Street, which is always my favorite. In fact, I fight to be in that segment, but there's never enough chairs to go around. No matter, as Dave Kansas, Adam Lashinsky, Herb Greenberg and our guest Tony Dwyer mixed it up very nicely. For me, the key point made was Tony's, regarding the Dow's move having staying power. From the get-go, I could hear Tony speaking that TA lingo I love, so I was immediately confident that he knew what he was talking about!

Essentially, his point was that the move in the Dow (and the S&P 500) had staying power because there was plenty of volume behind the surge. This is an important concept: Whenever you see a breakout or a trendline change, look for a volume spike to confirm the move. If you look at my Technical Forum column today, you'll clearly see the breakout in the S&P 500 (via its chart), but I had to block out the volume bars to add my remarks. However, if I hadn't, you'd have seen Tony's point very clearly. Behind that move on Thursday was huge, huge volume. That confirmed that the move in the "Old Economy" stocks wasn't a fake-out. Well done, Tony!

Adam and I were up next, and we were clicking. There is a real energy to being able to do your segment from NYC instead of remote, and Friday was Adam's turn in the nerve center. We both were bullish on Berkshire Hathaway (BRK.B), and here was a good illustration of the same kind of breakout as that behind the Dow and S&P. Notice the volume spike when Berkshire broke the downward trendline? Adam liked Berkshire for different reasons, but the conclusion was the same: The Oracle is back.

If you watch the show, you'll see me almost fall out of my seat as Adam defends InfoSpace(INSP). Honestly, that was not an act: I seriously couldn't believe he'd buy the company anytime in the near future, and am certain the stock will go a lot lower before it comes anywhere close to its former glory. C'mon Adam, the stock's had a 1000% move since November. It's over big guy, so give it up! I promise, this is one we'll definitely revisit.

Next up was Stock Drill and whenever I've done it, I always feel like the odd man out. The reason? Most of the guests are fundy guys, so when it's my turn, I feel they need to bring in a U.N. translator so we can all communicate.

However, this show was different, as Tony is bilingual and able to speak both fundy and TA. That made for a great segment, as both Herb and I were able to get our licks in, with the only problem being not enough airtime to go around. (Think Cramer is hard to interrupt? Herb barrels on like a Mack Truck, and with him there's no passing lane!)

Tony, of course, defended his picks, Networks Associates (NETA) and Informix (IFMX), to the hilt. Surprising for a technician, though, as I think he's dead wrong with Networks, while Informix, at best, is uninteresting. Here's the charts I used, so let's keep an eye on these stocks to see who ends up being right.

Finally, we wrapped up as usual with Predictions, and if you don't like this block, you probably don't like TSC. Why? Because here's where everyone's true personality shines through ... and it's my job to deflate their respective egos! We mixed it up pretty good with this segment, poking fun at each other, with Brenda Buttner doing her dogged best to referee.

Honestly, the only highlight I can remember, though, is when Brenda asked me what I thought of Herb's prediction. Well, with all the chatter and guffawing, I'd completely missed what he was talking about. I could therefore have lied and made something up, or spoken the truth. And the truth won out: I never pay attention to what Herb says when it comes to market calls! (And trust me, that's exactly how he'd want it!)

Oh yeah, my gang of 10-year-olds? They watched an old Scooby-Doo rerun in the Green Room during the entire show. So, I guess the rest of us still have some work to do to broaden our demographics!

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