I have about 10 major pet peeves regarding trading. At the top of the list is when a trader trades in an undisciplined manner. There are many variations of that theme, but the number one reason is not knowing the news. This can easily be avoided through methods such as doing homework and/or just asking what is going on if one is not sure. It genuinely bothers me when people lose money unnecessarily. Now, I do take everything to the next level- I am guessing that I spend more time writing the blog, preparing the watch list to monitor for the trading day, and doing research than I actually do trading in any given day. I am a firm believer in the principle of sifting through the minutia to find the good stuff…but boy oh boy do I ever sift through a lot of minutia. To me, it is a necessary part of the homework I undertake to have a better chance for whatever success I hope to achieve each and every trading day. I bring this up at this time to emphasize that in this particular time of extremely light newsflow, there are certain periods during the trading year in which I for one tend to earn much of my living for the year. Furthermore, when newsflow is lighter, it is inexcusable not to know stories behind why certain stocks are moving. When it is this slow, I know I need to really truly understand what is going on in order to maximize profit potential on the limited opportunities out there. One does not need to read four daily newspapers, look at 10 websites, and do a daily scan for every stock that railed/declined at least 5% and closed on its high or low the day before (although it helps me). But it certainly does pay to do a bit of homework when the opportunities are there to have a really good trading session.
Markets overseas were very strong overnight with Hong Kong up 1 ½%. In Europe, the bourses are up 1 ¼%. The dollar is very weak against the euro (which is helping fuel the rally) with oil and gold sharply higher as well. Add to the mix many people are away and news flow is generally OK and this leads to a sharp rally in futures. There is absolutely no reason for the market to lose it gains barring a rally in the dollar. Look for the market to remain strong all day. Focus on the pockets of limited opportunities out there from the casinos to the small-cap memory stocks to the solars to the limited amount of stocks with newsflow.
Watch list:
11232009Eriklist.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 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
NLST- continued its run-up in closing in the upper end of its trading range
KIRK- closed near a high after posting good earnings
GGR- closed near a high
LEAP- closed near a high on takeover rumors with PCS
POT, MOS- among the fertilizer stocks closing near their highs
CLD- closed near its high of day after debuting as an IPO
SRLS- closed near a high after posting good earnings
TSTC- closed near a high
DRAM- closed near a high
GFF- closed near a high after posting great earnings
LEA- mentioned on “Mad Money” on Friday night
JOBS- good earnings
LDK- good earnings
TECD- good earnings
CIEN- buying Nortel’s Ethernet assets; sees acquisition “significantly” adding to fiscal year 2011 results
CPB- decent earnings
Bad-The following stocks have bad news and/or a weak technical patter
HSY- the company is rumored to be bidding for Cadbury
SVN- closed near a low after debuting as an IPO
DHI- closed near a low after posting bad earnings
CEPH- in an initial phase IIb/III study, Cinquil achieved statistical significance in only one of two tests
Earnings:
MON NOV 23 BEFORE
CPB LDK TECD
TSN VAL
MON NOV 23 AFTER
ADI ATW BRCD
HPQ NUAN
Good luck today.
Epiphany Trading, LLC
www.epiphanytrading.com
Erik R. Kolodny- Chief Markets Strategist
Brendan P. Byrne- President
Joseph R. McCandless- Managing Partner
D. Timothy Seaquist- Managing Partner
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