Yesterday, a very intelligent comment was written in the chatroom: “I am just trying to help when I say "stocks have no emotions only people do" and in order to become a prolific trader you must control your emotions, stay positive and trade with conviction. Negativity breeds negativity. I am simply pointing out my thoughts, not making any judgments towards anyone because we all at times get emotional.” This paragraph is worth a three hour long symposium as well as 500 pages worth of essays. This is one of those rare paragraphs in which literally every single word is important. It was written from the heart and extemporaneously at that yet it addresses a band of issues with which every one of us should be aware of. I am going to address this paragraph in sections in the order it was written on and off for the next few weeks. For today, before I address the first phrase, read that paragraph and put it just above “The Ten Commandments” on your mantle. Now the first phrase and the easiest part of this: “I am just trying to help.” It is more than a little mind-boggling to me that this phrase ever has to be typed out in a business-sense particularly when the person typing it actually can be and usually is of help. Yet, it is always written in an effort not to offend those individuals who tend to need help the most. G-d knows I for one sure need as much help as possible trading-wise in an effort to better the quality of my trading so I always appreciate any and all advice. Now, of course, one may use that phrase “I’m just trying to help” when one is being overly nosy or concerned about being as such, but really, whenever I read that phrase I pay extra attention because I tend to learn something from the person saying/typing it. The net of this is as such: traders tend to have egos and are overly sensitive. It should be just the opposite. When someone knows a lot more about something than I do, I listen and sponge every word in business and in life. It is particularly true in the trading world and I hope everyone realizes that when I or someone else every so often notes the words “I am just trying to help when I say,” the intent is indeed to help- not harm.
Markets in Asia were mixed overnight with the averages closing ahead 0.7% in Tokyo, but down 0.4% in Hong Kong. Prices in Europe are slightly lower. Oil and gold are both down 1%. The dollar is notably weaker against the yen but much stronger against the euro. Futures are off slightly per the discussion yesterday; JPM beat its earnings but missed on revenues. INTC beat and raised guidance, but there is concern about capital expenditures per their conference call last night. It takes really really good earnings right now to keep these things going. On this options expiration Friday, look for a very choppy session particularly in the early going with JPM and INTC as your benchmarks for market direction. A blind guess is that the bias will be slightly to the downside, but it is truly a day of trading what you see. There will be a lot of relative strength plays today with most of the action coming in the early early hours of trading as well as just after the bell. Be aware that even though INTC and JPM lead the watch list, there are not in any circumstances to be scalped…use them only for the best trades and as signs of market direction please. Trade accordingly and spend any free time (of which there probably will be some mid-day today) doing your earnings analysis for next week and studying your trades you’ve done so far this year to truly ready yourself for the onslaught of news starting next week.
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
INTC- good earnings
SHFL- good earnings
CF- withdrew offer for TRA
ENER- mentioned on “Fast Money” last night
MNKD- closed near a high
TWC- closed near a high
BIDU- closed near a high
UTHR- closed near a high
AVAV- closed near a high after positive analyst comments
RNWK- closed near a high after founder of company gave up CEO post
UPL- featured on “Mad Money” last night
Bad-The following stocks have bad news and/or a weak technical pattern
TRA- CF withdrew offer for the company
AGU- seems to be leading contender now for acquisition of TRA
ATHX- share offering
AONE- island reversal in closing near low despite news of a major sales deal
BGG- closed near a low after issuing poor earnings
FSLR, STP, TSL- closed near lows in a weak solar sector amid reports that the German government may cut subsidies to solar companies
FALC- weak earnings guidance
CAAS, WATG, CYD- featured on Sell Block on “Mad Money” last night
JPM- beat on earnings, but missed on revenues
Earnings:
FRI JAN 15 BEFORE
JPM
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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