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Wednesday, November 24, 2010

WED. NOV. 24- Be Thankful

Our forefathers lived in the Stone Age about a billion years ago. One billion months is about 82 million years. If you sat down to count from one to one billion and did at an average pace continually, it’d take 95 years to do it. A billion inches is about 16,000 miles or about halfway around the earth. The earth is 8,000 miles wide with the sun 800,000 miles wide…that is a fraction of a million with one million being 0.1% of a billion! So, it is extraordinarily tragic to me that Darwinian theory applies here certainly to an extent in that none of those numbers are as mind-boggling to me as this one: 1 out of every 6 people living on our planet are starving. Every business day, I write about something relevant to trading. Well, it is of a great deal of importance of course that we do things as traders like earn a living so we can do basic things like eat. I get that and embody that spirit. With that in mind, it’s not lost on me for example that many nurses in hospices earn just above minimum wage. I don’t delude myself. I play a computer game for a living. Trading is obviously a very hard profession as evidenced by its high drop-out rate and inability of many traders to procure a living. But I don’t have to watch people literally die to earn a living. Nor am I starving. So, as we approach Thanksgiving and look forward to thinking about things like gluttony, football, and of course spending time with our families and friends tomorrow- even if a lot of other things are going wrong- be very very thankful for what you do have. Specifically, from a trading standpoint, be grateful if for nothing else that as a day trader, you’re in a sterile office setting with the hopes of earning a lot of money every day…with the likelihood of having a couple of meals on a daily basis quite high. And let me end on a very happy note by wishing everyone a very happy Thanksgiving and noting how thankful I am to know on a personal level many of the people reading this blog.

Markets overnight were mixed in Asia with Tokyo down 0.8% but Hong Kong retraced 0.5% as the Korean headlines had broken the previous day when the Hang Seng was open but the Nikkei closed. The gains are even greater in Europe with most bourses up either side of 1%. The dollar and the commodities are quiet at this point. Futures are rebounding after yesterday’s declines as things have stabilized ahead of the Thanksgiving holiday with the beginnings of a resolution in Ireland at that as it appears that there will be a de facto nationalization of the likes of IRE with the government taking greater than a 50% stake. There is a titanic amount of economic news. Personal Income (0.4%), Personal Spending (0.5%), PCE Prices- Core (0.1%), Durable Orders (-0.3%), Durable Orders ex transports (0.4%), Initial Claims (442,000), and Continuing Claims (4.28 mil) are all due out at 8:30AM, final Michigan Sentiment (69.4) at 9:55AM, New Home Sales (312,000) and the FHFA Home Price Index at 10AM, and Crude Inventories at 10:30AM. For the day, look for a placid session with muted reactions to all economic news albeit likely with an upside bias. The focus will likely be on the Irish situation, the earnings plays, the momentum stocks that defied the market yesterday, and relative strength plays.

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

GES- great earnings

AWI- declared special $13.74/share cash dividend

SODA- closed near a high

CRM- closed near a high

IRE, AIB- according to the “Financial Times,” the government of Ireland will take a majority stake in the Bank of Ireland

DDMX- received $23.50/share takeover bid from DashNow

ORCL- won $1.3 billion in damages from SAP

TIF- decent earnings

Bad-The following stocks have bad news and/or a weak technical pattern

TIVO- poor earnings

GS- closed near a low

HRBN- closed near a low after amendments were made to the takeover offer on the table for the company

WYNN, LVS- closed near their lows

MA- closed near a low

DEXO- closed near a low

TPC- closed near a low after announcing a share offering

CISG- closed near a low after posting bad earnings

DE- poor earnings

FRO- poor earnings

Earnings:

WED NOV 24 BEFORE

DE FRO TIF


Epiphany Trading, LLC
www.epiphanytrading.com

Erik R. Kolodny- Chief Markets Strategist
Brendan P. Byrne- President

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