I just want to post a quick note and some good news about our PAETEC Holdings (PAET) position. We’re back in the black thanks to today’s big push higher (5.0%). More importantly, we tackled a fairly significant short-term hurdle that could/should unlock some solid long-term movement (the kind we’re trying to capture).

Take a look at the chart. Specifically, take a look at how PAETEC Holdings shares had been hitting a ceiling right at $4.00 for the last month. In fact, you can go back two months and see there was something troubling about that horizontal resistance level. With today’s move to $4.17 though, I think we’re well down the road to staying above it and making some nice progress now.

PAETEC Holdings (PAET)

Just to be clear, that’s not to say PAET won’t be back under $4.00 at some point in the near future. I think the stock’s chipped away at the wall well enough by now, however, that it can remain above it for good (as long as the market doesn’t completely implode, which it shouldn’t).

Anyway, if you were already in the trade from our October 6th recommendation, you’re back to where you were. If you weren’t in PAETEC Holdings yet though, here’s your second chance.

Your Questions Answered

Thanks for all the great questions and comments you’ve been sending in. We’re going to try and start answering them in a public forum, as we can all get a better understanding of how this site works, how to invest better, etc. Here’s a recent one I think has a lot of importance for all of us.

Q. Hi, thank you for your concern about my trading method and my interests . I am a day and /or swing trader and I am been doing it for seven years now , I do make a living of it and so far I am very satisfied . I lost tons of money until I learned it and still I am learning every day something from some body or from my mistakes . I only trade stocks (equity) and no options , currency , forex or any of these and I only trade OIL . I only trade OIH , APA , DO, XOM and CVX , either I go long or I go short and that’s it . I don’t get any help from any sites , don’t listen to any news from radio or tv and I am so independent because I lost that ton of money by listening to news all the time and keep losing more therefore I stopped it . I hope I can get some picks from you , just one good pick a week that’s all I anticipate or one a month . At this time I have no questions cause I don’t know your method of approach or how you conduct to your picks and trades.

A. Thanks for the feedback and inquiry. I’m not going to address all of your points, but I do want to address some that pertain to all users of this site.

1. We are generally a ‘long only’ service; if we need to take a bearish stance, we use bearish/inverse ETFs. This keeps our picks accessible to pretty much everyone.
2. We seek holding periods measured in weeks or months. It’s not that we don’t think day-trading is a good way to make money, but we do think it’s a more difficult and more competitive way to make money. We also think we can achieve bigger returns (via lower commission, fewer taxes, and more simplicity) with longer holding periods. To each is own (and whatever works). Why not try a little of both.
3. We’ll probably issue a pick somewhere between once per week and once per month; we never trade just to throw out a trade though.
4. Yes, TV is a terrible place to get picks. Magazines and papers aren’t much better. Websites are pretty lousy as well, though hopefully you’ll find this one is an exception. We try and remain very transparent for that reason, in addition to tracking and publishing our real results (good or bad).
5. Our approach is a technical one, that’s secondarily supported by fundamentals. We’ve found that far too many ‘great looking stocks’ (based on fundamentals) simply don’t move higher…. defeating the purpose of investing. At least with a technical approach first, we can find stocks that are moving.  [I've found far more investing success using technical trading than the so-called experts would ever say I was supposed to be able to.]

I know that doesn’t tell the whole story of our approach. Just keep reading our stuff, and it will be absorbed over time.