Day Trading Thoughts For Mon. Feb. 9

Discussion in 'Trading' started by erikrkolodny, Feb 9, 2009.

  1. erikrkolodny

    erikrkolodny ET Sponsor

    Very notable on Friday were three distinct phenomena. First, despite it being an ‘unemployment Friday’ along with a huge market day, volume was less than ¾ of what it was in the SPY and 2/3 the pace of the QQQQ on the day before (Thursday). Second, the VIX- the main measure of volatility- barely moved down. Finally, oil prices notably closed down. All of these are notable ‘bearish’ signs, but that is not the point here. Rather, what is important is that the market stormed higher on the heels of positive comments from a top banking analyst about BAC which in turn led to buying in the other financials as well as hope for the financial stimulus package. We as day traders must focus on the immediate-term. I have made this point time and time again…and yet it something that so many traders are guilty of violating. Consistently, what I heard (and admittedly found myself thinking every now and again on Friday) were things like: “that GS just isn’t rallying anymore,” just after it had hit a new high and backtracked 15 cents in five minutes. The problem of course is that we as a group are so used to a bad market that seeing green consistently on our screens in the ‘net change’ column is something viewed as not to trust. But again, the old saw ‘the trend is your friend’ is even truer when day trading. One must rely on what he/she sees in front of him/her…not what he/she thinks may happen.

    Prices were mixed in Asia overnight with Hong Kong up about 1% while Tokyo finished down by 1% after opening sharply higher. In Europe, equities are down about 0.5% across the board. Futures state-side are weaker as details of the bank plan slip out albeit formally delayed for full release until tomorrow. All of this just dies not seem to bode well today. The markets want (good) action now and any la is going to hurt. Look for at least a partial if not complete reversal of Friday’s gains with rumors driving the landscape all day.


    Reiterating-Please understand that if the ideas do not get to the hoped for set-ups cited below, more often than not, one should not blindly trade the symbol next to said idea.

    If the whole story is not there -If something is good, assume either a short thru unchanged or an A-B-A2 based on direction of the market unless specified

    If something is bad, assume either a buy thru unchanged or an A-B-A2 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specified

    Good- The following stocks have good news and/or a strong technical pattern

    MI- closed near a high

    SWKS- closed near a high after posting great

    GS- closed near a high

    NFX- closed near a high

    RF, FITB, BAC, STI, PNC, USB, WFC, JPM, C, ZION, STT, SNV, SNV- among a list of bank stocks which are going to move today; if they open higher and go to unch, short. Otherwise, A-B-A2 off of the open.

    GMXR- on “Mad Money” on Friday night

    CLF- closed near a high

    MLI- closed near a high

    SOHU- solid earnings

    HIG- mentioned as a potential acquisition target in “The Wall Street Journal”

    DRYS- received a covenant waiver on $800 million of its debt

    Bad-The following stocks have bad news and/or a weak technical pattern

    SRCL- closed near a low

    MEND- closed near a low

    ENER- beat earnings slightly, but warned on revenue estimates for next quarter

    HAS- terrible earnings

    NYX- missed its earnings estimates

    WHR- missed its earnings estimates (again) and warned (again)

    Earnings:

    MON FEB 9 BEFORE

    AG ARE ASF

    BCS CTRP ENER

    HAS HEW L

    LO MCY NYX

    ROH WHR

    MON FEB 9 AFTER

    AFG AXS BEC

    CIM CMP CPT

    CRK CRL CUZ

    LNC LNCR PFG

    PPDI QGEN TMX

    UDR VECO VMC

    VRTX


    Good luck today.

    Erik R. Kolodny
     
  2. burn8

    burn8

    Thanks.

    -burn8