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.
Watch list:
05042009Eriklist.zip
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
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
Earnings:
MON MAY 4 BEFORE
ASF B CCC
C.NA CYOU EL
ETR HSIC L
OSG S SOHU
SYY TSN
MON MAY 4 AFTER
AFG BBD CHK
CRK DFT EOG
EXR FMC FST
GVA HCN HE
HLF HOLX HRC
KND MCK MYGN
PFG PPS SBAC
SM TXRH VMC
Good luck today.
Epiphany Trading, LLC
www.epiphanytrading.com
Erik R. Kolodny- Chief Markets Strategist
Brendan P. Byrne- President
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