Day Trading Thoughts For Mon. May 4

Discussion in 'Trading' started by erikrkolodny, May 4, 2009.

  1. erikrkolodny

    erikrkolodny ET Sponsor

    When I was a kid growing up in Savannah, GA (a beautiful town demarcated by 24 squares downtown based on London’s ‘square’ system), we always participated in May Day ceremonies. As a kid, it was a way to get out of half a day of school although the trade-off was that we had to dress up in May Day costumes and (gag)- dance. But few people are aware of the true meaning of May Day. In most countries, May Day is associated with International Worker’s Day aka Labour Day. In the U.S., we celebrate Labor Day the first Monday in September because there are no federal holidays between Independence Day and Columbus Day so that kinda splits the middle. True factoid. Going back to May Day though, it is notably also exactly half a year from various pagan festivals conducted the day after Halloween as well as the same day as All Saint’s Day. Almost the entire developed world celebrates this holiday with the notable exception of Great Britain, Japan, and continental North America. Thus, most of the world’s markets were closed Friday. When taken in combination with the end of the busiest week of earnings season and stress test waiting, it set the stage for a very slow day on Friday. Thus the daily epiphany: as American day traders, we of course focus (as we should) on events directly impacting American companies. But there are other people in the world who do this and when they are not around, it makes things a bit more illiquid and less trade-friendly. This is why much of my activity was done between 6:30Am and 8;30AM on Friday; there is no point trying to scalp much less to create something out of nothing when precious little is occurring in the trading pits.

    Overnight, prices in Hong Kong were up sharply (almost 6%) amid hopes of the concept of Chinese investment in Taiwan as well as an abatement of swing flu fears. The rally continued into Europe with prices up about 1% across the board. State-side, things are quiet but a bit higher. The overhang on the markets which is as thick as the cloud cover over Manhattan this morning is the distinct likelihood that BAC and C are going to need more capital. Look for a day similar to Friday with quiet choppy trade on both sides of unchanged during the day, but a bit of a stronger bias overall unless BAC and C get significantly weak. It is a very dangerous trading environment as things are so placid so trade very nimbly.

    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

    STV- closed near a high after posting great earnings

    COT- closed off of a high, but up sharply on its return to profitability

    MTD- closed near a high after posting great earnings

    NETL- closed near a high after posting great earnings

    FLIR- closed near a high after posting good earnings

    JRCC- closed near a high after posting great earnings

    RIMM- announced strategic deal with HPQ to integrate HPQ services with its Blackberry devices

    CYOU- good earnings

    HSIC- good earnings

    S- good earnings

    SOHU- good earnings

    NAFC- decent earnings

    DF, SMG- on “Mad Money” on Friday night

    ACAD- announced licensing deal with Biovail (BVF)

    DTV, LINTA- announced merger integrating the equity of the two entities

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

    FAF- closed near a low after posting bad earnings

    AOC- closed near a low after posting bad earnings

    TBL- closed near a low after posting earnings Thursday morning; it has completely reversed since then

    OSG- poor earnings

    L- poor earnings

    BAC, C- may need more capital

















    Good luck today.

    Erik R. Kolodny
  2. bullshit
  3. You said to look for a choppy session like Friday? It looked pretty lopsided to me!
  4. erikrkolodny

    erikrkolodny ET Sponsor

    I was right several days in a row on that section and didn't find either of you saying "Nice job, Erik" yet you are quite quick to jump down my throat when wrong. It is of course absolutely deserved for yesterday, but do look at the whole big picture. I am certainly not perfect nor am I a robot; I certainly did not foresee that run-up yesterday. Yet, as a day trader, I still did very well yesterday because I readily acknowledged the error of my judgement intra-day and routinely traded from the 'long' side all day long.

    Again, as I keep saying to anyone who has read these posts, the 'market prognostication' part of this is inevitably the least accurate average time horizon for a trade is just under two minutes. This is why I set up a 'good' and a bad' section so I have ideas to choose from. I quickly adjust knowing I am going to be wrong about 43% of the time and trade as I need to in order to earn a living. The trick is to do what it is I have done for years- make more money on the 57% of the time I am correct than what I lose on the 43% of the time I am average time horizon for a winning trade is about three minutes...for a losing trade ,it is just under a minute.

    Good luck to all.
  5. zdreg


    that is a very high win loss ratio for a day trader.. how many shares do u trade on average.

    thx for posting everyday. the information is quite useful.
  6. erikrkolodny

    erikrkolodny ET Sponsor

    I traded 2,453,870 shares last month and 2,025,325 in something like 100,000 a day. It is not nearly as big as I used to do 'back in the day,' but it is more surgical so to speak; for instance, I traded 5000 MGM (on each side) after-hours as MGM ramped upon its earnings release.