Day Trading Thoughts For Mon. Mar. 23

Discussion in 'Trading' started by erikrkolodny, Mar 23, 2009.

  1. erikrkolodny

    erikrkolodny ET Sponsor

    With the exception of professional gamblers/poker players, when people are at casinos, they are there for one reason: entertainment. In absolutely no way do I think that the stock market is the equivalent of a casino; furthermore, I get really riled up when someone with no knowledge of how this stuff works equates trading to straight-up gambling. The two corollaries are that 1) trading is of course like gambling when one has no idea what they are doing. Whenever new traders began trading, inevitably, they think they will be able to ‘beat the system’ and go out and promptly lose a lot of money very fast after doing no homework and asking next to no questions. But my point here is the 2nd corollary: why is that even otherwise reasonably intelligent people when bored at the casino whether the cards are ‘bad’ or they are just playing the slots feel compelled to simply keep playing even they are losing net-net? How many times have we waited on friends to be done or stayed inside while others were smoking or whatnot and plunked down another X amount of money at the blackjack table even when something seems amiss or just mindlessly plunked coins into a slot machine? When you do that, net-net, you’re gonna lose. Guess what? It is the SAME thing in the day trading world. When there is next to nothing going on as occurred much of the late morning and early afternoon on Friday, why is that people feel compelled to push buttons? The answer of course is obvious: we as day traders are here to earn a living and if we don’t push buttons, we can’t earn a paycheck. I get that. However, the other answer is that we are sitting in front of these nice computer terminals so we feel compelled to try to trade. Well, if the markets are not moving, why would you begin to push buttons? Certain types of trading such as strict ‘rebate trading’ work at times like the two hour quiet stretch late Friday morning/early Friday afternoon, but if ones try to make something out of nothing while trading, one gets less than nothing. Thus, when things are really slow, there are so many better things to do than push buttons and lose: pay your bills, work on taxes, and so forth. Keep an eye to the screen always, but all that forcing things will do is lighten your wallet.

    Equity prices shot higher overnight in Asia and Europe; markets in Asia were up 3% to 4% across the board while markets in Europe are higher by about 2% on average. The catalyst is that Treasury Secretary has offered up a new bank initiative in which the government will work with private investors to purchase up to $1 trillion of “toxic assets” in order to get the system going again. Now, there are many questions- what will be the pricing mechanism, which private firms will step in, and such, but the equity markets love what they’ve heard so far. Look for a very strong open; the rest of the day will likely be dependant upon any details that sift out about the plan so trade with the details. If nothing new comes out, prices will likely plateau and give back a little, but not much so trade very carefully.


    It’s important to note that almost all if not all of the stocks on the ‘bad’ list will open higher today in the strong market so be well aware of the general environment today.

    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 (preferably to the downside in a downside market and the upside in an upside market) 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

    FCH, AA- rallied hard into the close in finishing on/near high

    MCD, KO- mentioned on “Mad Money” on Friday night

    PCZ, SU- SU buying out PCZ at a ratio of 1.25 shares of SU


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

    MAC- closed at low of the day

    JPM, WFC, PNC, USB, STT – among the big banks closing at or near lows of the day, but will likely open sharply higher today

    XRX- closed near low of day after issuing earnings warning Friday morning

    PRU- continued its freefall after being downgraded by Moody’s; closed near low of day

    WGOV- closed near its low

    PDLI- closed down sharply; it fell dramatically in last five minutes of day

    CNQR- closed near a low after CEO disclosed he had forged his education degree in SEC documentation

    CPHD- broke hard in last few minutes of day in closing near day’s low

    KSU- broke to a new trend low

    WRE- closed at low of day

    CAI- broke to a new trend low

    BXP- had major reversal in REIT sector last few days in closing near a low

    BMR- closed at a new trend low

    MTH- has fallen over 30% in two days; closed near a low

    TIF- beat for quarter, but warned for year



    Earnings:

    MON MAR 23 BEFORE

    TIF WAG

    MON MAR 23 AFTER

    FMCN PVH SONC


    Good luck today.


    Erik R. Kolodny
     
  2. Please stop generating a new thread per day.
     
  3. Thanagar

    Thanagar

    Erik, you may have covered this question before, but would you have rebought WAG when it passed through A2 a second time?
     
  4. erikrkolodny

    erikrkolodny ET Sponsor

    From last Thursday when we went over this before...in the interim, may your biggest worry in life be a complete stranger's postings on a messageboard:

    03-19-09 04:38 PM

    a) I’d hope that anybody who posts anywhere here has a quest of becoming a better trader.

    b) Many people keep missing my two main points: First, I have zero incentive to post here. All I am trying to do is help. I wish when I was starting out that I had an idea source to turn to along with a little daily discourse on day trading; I vowed I’d do what I could if was ever presented with an opportunity to help people. I know that sounds goody-two-shoeish, but I could not be more sincere. I am here only because I was asked to do so because some friends thought I could be of help. Second, there is no one thread for each given day for people to post their thoughts on day trading. Thus, I offer mine and want others to the same. Ergo, I don’t want a thread entitled “My Day Trading Thoughts” because I want more people than just me to post. Who am I to be the final say on day trading?

    c) If it is “annoying,” don’t read it. I have been a witness to some horrible tragedies in the last few days including watching my father-in-law who I loved as my own father die in front of my eyes. I am genuinely amazed at the fact that people have nothing better to do than anonymously attack writings on the Internet. Really. Put that energy to good use. All I am trying to do is something good/nice. If you don’t like it, don’t read it.


     
  5. erikrkolodny

    erikrkolodny ET Sponsor

    No. I only like to do it the first time. What I want is a rapid movement one way or another when I enter something and find that (for me), net-net, I lose when buying/shorting A3's/A4's/A'5s.

    For instance, I bought ARG today at 32.50 at 10:15;14AM. I apologize for not posting a chart, but I cannot get the chart to paste so please look at your own for visual guidance. ARG issued an earnings warning, traded lower, but got near unchanged. it touched 32.52 at 10:06AM, came gently in, but hung in there. Thus, as the market began another up leg just after 10:15 and ARG approached a high, I bought it (with an order price of 32.55, but was thankfully so fast that I got a better fill). As the stock got positive, many shorts on the bad news paniced out. I sold half at 32.85 and the balance at 33.02 in the first two pauses (andmissed out on the rest of the rise).

    Basically, I want the stuff as 'smooth/easy' as I can get it.

    Good luck.

    Erik



     
  6. Erik,
    Personally I prefer the recurring new dated threads. It allows the old threads to fall off of the bottom screen rather than looking like a dead beat horse that's still being dragged through the mud.

    Just wanted to let you know I appreciate the fresh information, insight and opinions. Whether I agree with them or not, and I appreciate the threads being clearly marked as current.
     
  7. Keep posting. The more trading ideas floating around the better IMO. Whether I think your ideas are good ones or not is irrelevant.

    Your threads are a lot more value added than many of the other threads I read.
     
  8. erikrkolodny

    erikrkolodny ET Sponsor

    Thank you. The request from TraderZones is not wholly unreasonable, but it is like you said- I want the old threads to be sifted away and do not want people to have to scroll to the bottom each day to read/comment on that day's information. Plus, my biggest hope is that I get drowned out by the minions of people far more intelligent than myself who comment on that day's day trading prospects/actions.

     
  9. aradiel

    aradiel

    Erik, using my memory as database, I believe that usually big gap up days that happen on mondays tend to be strong all the and seldom the gap is closed. Do you have a study about this or any other kind of weed day seasonality?
     
  10. erikrkolodny

    erikrkolodny ET Sponsor

    First, please if you can, try to respond to the current day's post if possible, i.e. this type question can be put on the current day's post. I don't want to clutter up Elite Trader for anyone not interested in reading these Day Trading posts...sorry for the housekeeping stuff, but again, just trying to respect those not interested in these day trading posts.

    In any case, I have a ton of seasonal stuff I could spew at you, but I've never heard of/researched big gap days on any given weekday in detail ergo I am going from memory here.

    Tuesdays historically have been reversal days (Tues Oct 20, 1987 was a true reversal session via gap) with three weeks ago Tuesday being a reversal day for the current market (for the new bull market/bear market rally/whatever you want to call it). A good Monday closing of a gap off-hand would be March 17, 2008 when Bear Stearns failed; futures were limit down overnight, but the benchmark averages reversed with the Dow closing up (I think) 20 points that day.

    In direct answer to your question, November 10, 2008 saw a gap higher open on the markets with the averages closing just off of their lows. October 13 saw a gap higher open in whih the market kept going. There was a gap higher on the Monday after Labor Day in which the markets opened near their highs and sold off. Ditto for July 14. So, off-hand, I'd hae to do a lot more homework, but don't see why Monday gap highers would be any more pervasive than those of any other day of the week.

    Take care,
    Erik

     
    #10     Mar 30, 2009