On this Kid’s Day at the NYSE in which everyone is encouraged to bring their kids to work there, let’s reflect not on what we’re thankful for (that was yesterday!), but rather why the market is open today. The market is typically open for half days on the day before Independence Day, the day after Thanksgiving, and Christmas Eve. There have been selected days in which the market has been closed full-days as well. Namely, the market closed for several months during World War I, a stretch of days on and off between 1928 and 1930 in which member firms were allowed to catch up on work from the heavy volume of that time, and on days in which there have been funerals of presidents. Most recently, the market was closed for four days during the horrible 2nd week of September in 2001 following the terrorist attacks on American soil. Although there is nothing in the official stock exchange guidelines, there is indeed an unwritten rule that the markets not be closed for more than three days in a row so as not to allow for an order build-up and/or exacerbate a move should there may be a major news event. Since we have to be here, it is important to note that many days after Thanksgiving have been major trading days for the markets. One of the more recent interesting post-Thanksgiving sessions occurred in November 2000 after the election results were announced on Thanksgiving night. Days after Thanksgiving are typically ripe with illiquidity, but also bring in many amateurs playing stock market thus exaggerating moves that much more. Certainly, today will arguably be extraordinarily interesting so although it will be highly illiquid, there is going to be movement all the way up until the 1PM ET close (and potentially thereafter).
Markets overnight were absolutely ravaged on news that the main investment arm of the Dubai government has declared a moratorium on its debt with the implication it could default. This has shocked the system in that it’d appear that the emerging markets of the Middle East are much weaker than thought. The Vietnamese dong has been devalued and ripples are all over the system. Hong Kong and Tokyo have each fallen over 5% in the last two days. The European bourses are down about 3% in the last couple of days (although marginally higher in the current session). Oil has fallen 5%, gold is down 2%, the dollar plunged to a 14 year low against the yen…name it, it’s moving. For today, look for extraordinarily thin and volatile trade. The newsflow is nearly nonexistent in individualized names, but ostensibly any big cap tech stock is worthy of a trade especially early on. It will be very dangerous due to the thinness of the trade, but get your timing right and pick spots and it could be quite the day.
Watch list:
11272009Eriklist.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
JCG- closed near a high after posting good earnings
DE- closed near a high after posting earnings on Wednesday morning
WYNN- closed near a high
X- closed near a high
CLWT- closed near a high
KNDI- closed near a high
TRIT- closed near a high
BKS- closed near a high
TSTC- closed near a high
DRWI- closed near a high
QLTI- closed near a high
IFON- closed near a high
SINA- three investment firms are investing about $180 million into company according to “WSJ”
Bad-The following stocks have bad news and/or a weak technical patter
DRAM- closed near a low after posting bad earnings Tuesday afternoon
Almost everything- most stocks will open sharply lower today on the Dubai news
Earnings:
FRI NOV 27 BEFORE
FRO SFL
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
