Day Trading Thoughts For Mon. Jan. 26

Discussion in 'Trading' started by erikrkolodny, Jan 26, 2009.

  1. erikrkolodny

    erikrkolodny ET Sponsor

    There has been talk of a “financial-transaction tax” which would be assessed on trades of stocks. It is at the point where it has been discussed in Congress according to various newspapers and Internet sites. The tax would be 0.25% of the value of both the buy and the sell side of the transaction. So, assume you bought $40 million of stock and sold $40.1 million for a trading profit of $100,000 in a year..well, now you are down $100,000 because Uncle Sam gets an extra $200,000 (0.5% of $40 million). This whole concept is being discussed as part of the “sin tax” category and is sickeningly gaining a bit of momentum. An article published by Bob Herbert in a January 12 edition of the “New York Times” received a great deal of positive feedback under the comments section as traders are now being viewed as the devils that caused this crisis. The article is below:

    Such a tax would put about every day trader out of work. The tax is designed to make entities hold positions longer. All this will do is cause the capital markets to ostensibly stop functioning. Volumes and liquidity would disappear due to a dearth of participants making things even worse than they are now. The good news is that such a tax seems highly unlikely to pass. Sheila Bair, the head of the FDIC and soon-to-be Treasury Secretary Tim Geithner are philosophically opposed to such a tax; furthermore, President Obama seems in no immediate-term rush to raise taxes of any sort to anyone. But, this is a situation to monitor over coming months and we must all be vigilant in being politically active when warranted to oppose such a tax as we’d all need to find a new line of work should such a tax be assessed.

    Markets throughout the world were relatively placid overnight. Most of the Asian markets were closed to celebrate the Chinese holiday with Tokyo the only major Asian exchange open; it closed down 1%. European markets are trending a bit higher as they were pounded Friday morning when the U.S. market was open, but the bounce is weak. State-side, futures are actually slightly weaker despite the big merger deal. Look for a fairly quiet day with the bias to the downside. It will likely be quite a bit choppier and more difficult overall than the four trading days last week so be careful.

    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 specifiedIf 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

    DOW, ROH- FTC approved deal on Friday; there may be news on deal terms at any instant

    GERN- had positive stem cell news on Friday; likely to sell off a bit if it opens higher as some of the institutional clients take profits amid reports it could take upwards of 10 years for the company to show results

    BK, CMA, SIVB- closed near highs

    GS, MS- closed near highs

    CRA- mentioned on “Mad Money”

    ABX- among others, very strong…very quietly, the gold sector was extraordinarily strong on Friday

    WYE- being bought out by PFE for 33 in cash plus .985 PFE shares; look for a trade here particularly at retail rush time at 8AM. Other trade here is to see if spread widens.

    ACV- decent earnings

    COV- good earnings

    DGX- good earnings

    JPM- re-initiated with a “Buy” rating at Goldman Sachs

    MCD- good earnings, but may see profit-taking

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

    GE- very weak on Friday; likely not a trade (at least an easy one), but worth watching for any newsflow

    DRIV- weak on Friday in closing at a 2009 low

    FUN- closed near a trend low on Friday

    GTXI- missed earnings late Friday afternoon

    CRXL- WYE not buying the company after all.

    CAT- terrible earnings and warned substantially for next year

    ETN- missed earnings estimates badly

    KMB- missed estimates and warned

    WCG- warned on outlook

    TSN- bad earnings

    GWW- bad earnings

















    Good luck today.

    Erik R. Kolodny
  2. Geez Erik this is your worst one. Who the hell gave this any stars????

    First off, europe was very significant this morning as Barcly's went up 60% and the TWO BIGGEST BANKS IN FRANCE MERGED!!! Common man...

    You look for a lifelss downtrending market today when I have been looking for a big up day. Think about that.

    All I see is reams and reams of un actionable symbols.. Common man, break this thing down! Apply some screens for god's sake Erik!, vol, Moving Averages, something.!

    This experiment has turned into a mess and now you have dipped your toe into forcasting the market's direction which is my arena... stick to the vague lessons of the market- that would be my suggestion and once you have created a watch list, come back and highlight the one or two you would buy...

    QLGC reports after the close. Buy? ~ stoney
  3. erikrkolodny

    erikrkolodny ET Sponsor

    I was early, simply put, but more than held my own and the market is indeed down now. I warned it'd be choppy and more difficult than any day last week and certainly for me, it has although I have come out OK as of this writing.

    As far as bad trades on that last of symbols, I shorted GERN off of the open although I thankfully got out quick and lost small MCD. On the good side, I shorted DOW thru unchanged, shorted ABX thru unch, and shorted FUN thru 11 (too bad I did not hold all of these, but this is not what I do). Not one of my finer days quite admittedly, but still (very low- first digit definitely a "1") four figure money.

    And it is not an "experiment;" I've been doing this for almost 13 years full-time. I am posting here only because I thought I could be of help to people. Period.

    As far as this being my 'worst one," believe me, I have had many worse days than this profitable one. I wish that was not the case, but alas, it is. But today's list/commentary? Not bad. Not even close to perfect, but not bad.

  4. erikrkolodny

    erikrkolodny ET Sponsor

    Following-up - Wow...very difficult trading day. Lots of whipsaw. Have not done a single trade since my last post so defintiely missed this little rally, but at least I didn't lose any of the earlier gains.
  5. Wild day, Mr. Kolodny! I had a good day in spite of the silliness in the market as well.

    And once again, thank you for your post(s).
  6. JPRDT


    Erik, I enjoy your thread and i Understand that I am not committed to follow your advice, therefor I will not crucify you if I disagree with any of your optinions or if you miss something. Keep the thread going and Stoney, if you have predictions on market Directions Then post em on a reply to this thread every morning.. The more opinions the better, just make sure you have justifications for them unlike that "buy everything" douche stock_trad3r.
  7. This has all turned into a newby 4 post joke. I'm very upset. I had high hopes. What does it mean when you have let down the stoned investor?

    Yes Erik it was an exciting day in opposite of your prediction. Yes entire watch lists were up 3%-4%.
    Yes that fog you saw was the breath of a bull.
    Snorted up for a second from a badly wounded animal on his back. Had not AFLAC stuff happened my work showed a plus 170 day, instead we gave a lot back... New lows were firmly ahead of new highs as one would think but if we can keep jiggering up we ought to see some shrinking in that ratio. On " Bad Bank Day " The rebirth of the financial system will begin - that will be our 500 point day and we should be cresting above 9000...
    before we take a fall. ~ stoney
  8. erikrkolodny

    erikrkolodny ET Sponsor

    I again emphasize that I trade with a time horizon of about two minutes on average. Thus, for purposes of the living I try to garner, I always keep the macro picture in mind, but trade with a focus on the micro. I therefore hope you are 100% correct for the sake of the world in your prediction (which by the way I agree with re the good bank vs bad bank hypothesis), but it is totally irrelevant in the schematic of day trading. Not investing. Not swing trading. Day trading. I do not to post on investing nor swing trading because what I do is day trade so I feel I have no right (nor qualification) to talk about something I do not do.

    Much more relevant and telling (to me) is this from your post: "Had not AFLAC stuff happened my work showed a plus 170 day, instead we gave a lot back... New lows were firmly ahead of new highs." My point that I keep making is that AFL did happen, we did not have a 170 point up day, and we did give a lot back. And I earned a day's pay for those few hours that we had that downside bias. I certainly did not foresee home data being that good yesterday (and in fact, I wrote about it this morning), but there was a downside bias for much of the session yesterday (10:15AMish to 3PMish ET).

    As for the watch lists, please read the blurb I post every morning. I give explicit instructions on how I plan to trade the stocks from the watch list and stick to the plan. If I have something specific to say, I say it. If not, it defaults to the general plan as posted every single morning. If I do not get the set-up I want, I don't trade it.

    I wish you (and everyone reading) nothing but the best in your trading today (and every day).