The biggest bear market in modern history. One of the biggest bull markets in modern history. From a macro vantage point, it has been an incredible year for equities. As of early March, there were numerous people literally questioning if the financial system was going to hold up as the Dow Jones Industrial Average fell to levels below where the Dow was when Alan Greenspan pondered if the markets were in a period of "irrational exuberance." Yet, whether the 13 years of gains that followed were ‘irrational exuberance’ or not, the markets staged a mind-boggling rebound with the NASDAQ bouncing 80% from its low as an example on the heels of easy money, low interest rates, easy money, a carry trade involving commodities, easy money, some genuine signs of economic recovery, and of course easy money. As 2010 prepares to commence tonight in what will hopefully be a safe and joyful Times Square, the outlook appears to be as confusing as ever. Trouble signs are everywhere from the ARM resets due to truly take effect next year to geopolitical risk to worries about an excessive run-up to interest rates rising. But bullish signs abound as well from the market being resilient to the Fed being ready and willing to do what it takes to keep the markets up in the short-term anyway to some stronger economic indicators. I know I sure as heck don’t feel confident about making a forecast. But as a day trader, I don’t have to and more importantly I do not want to do so. My job is to react to situations day-by-day…and that is what I look to do in 2010 no matter the macro picture around us. As day traders, we seek to not have biases…so don’t. Except for one: behalf of Epiphany Trading, let’s all hope 2010 will be a great year for day trading much less the economy much less the world…and have fun tonight!
Markets in Asia were generally higher with Hong Kong up 2%. Europe is flat. Gold is nicely higher with everything else quiet. Quiet. Yeah, that’s a good word. Futures are muted with no newsflow. Look for a stagnant session with movement in select microcaps and sectors like airline security plays otherwise not much. A wildcard will be the end of the day; usually, not much happens but one never knows particularly since it won’t take much to move individual stocks as the year closes out. Trade nimbly and selectively.
Reiterating-
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
EFJI- announced an enhancement to its adapters which make them compatible with Intel equipment
SEED- closed near a high after announcing completion of a second notes agreement; FEED closed near its high as well
OSIS, ICXT, RAE- among airline security stocks closing near or at highs of day
IPSU- closed at high of day on continued momentum following Tuesday’s positive settlement news
KONG- closed near a high
AAPL- closed near a high
TSRA- island reversal in closing on a high despite releasing news of a patent lawsuit loss on Tuesday
BIOD- seeking FDA approval of its Viaject for diabetes treatment
HPJ- closed near a high
IDN- closed near a high after being featured on Fox Business News discussing how its Defense ID access control product could have prevented the terrorist attack aboard an airliner in Detroit last weekend
Bad-The following stocks have bad news and/or a weak technical pattern
MED- closed near low after Fraud Discovery Institute called company a “scheme pyramid”
KFRC- near island reversal in closing near a low despite positive unit news Tuesday
CBAK- closed on a low after company said there was no truth to GOOG rumors
Earnings:
none today
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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