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Tuesday, December 28, 2010

TUES. DEC. 28- Taking Time To Learn

I once was a relatively young kid a long long time ago. And although I was a young kid, I still had the same zest for trying to "do it all" that I have now. Much of it- both work and play- occurred relatively late at night. And let me tell you something you most assuredly already know- nothing good happens when one has way too much time on their hands particularly late at night! Well, I found over the years that this is the case in the trading room as well. I came to realize that on days when there was precious little to do trading-wise and I had nothing to keep me busy, I'd do things like banter a great deal and miss the rare opportunity. Worse yet, I'd often try to create something out of nothing and wind up with less than zero monetarily. Thus, I started using the slower stretches to keep busy mentally and physically. I take longer and more frequent walks and do things like write blogs about keeping one's mind active while staying busy yet near should an opportunity arise. It's why oftentimes I won't do a trade in the middle of the day but get a lot of work and research done much less using the time to study past trades. So, yeah, let's talk a little about the Jets and Giants...but not enough to ruin a trading day or miss out on a shot to truly improve oneself mentally by utilizing the time to study trading as well as world politics, economics, news, and science. Extra education- particularly when having a little extra time- is never a bad thing.

Markets were generally lower in Asia overnight with Tokyo down 0.6%, Hong Kong 0.9%, and Shanghai 1.7% (in closing below its 200 day moving average). The tone was a bit better in Europe with Frankfurt up 0.1% and Paris 0.4%. The external markets are moving this morning though with the dollar down a yen and a euro, gold is up 1%, and oil up ½%. Futures are higher. Case-Shiller (0.1%) is due out at 9AM and Consumer Confidence (56.1) at 10AM. Look for a continual drift upward in prices today off-hand as many of the big caps show strength in the early going and the shake-off of the Chinese problems yesterday was notable in the immediate-term from a technical basis. The focus will likely be on the microcaps, the rare earths, the momentum plays (AIG for instance), and A-B-A2s to the upside in the big caps.

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

DARA- closed near a high following a report of positive cancer pain drug results in Medicalnewser.com

AVL, REE, MCP- closed near a high in a strong rare earths sector

AIG- closed near a high after receiving a $3 billion credit facility

GU- closed near a high after China exempted pure biodiesel fuel from consumption tax


GS- closed near a high

YOKU, DANG- closed near a high

VRML- closed near a high

STSA- closed near a high

STU- closed near a high after agreeing to settle on shareholder class lawsuits over the Discover deal

GM- initiated with a “buy” rating at numerous brokerage houses

MNKD- FDA told company it’ll need for more weeks to complete its review of the new drug application of Afrezza

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

TSLA- closed near a low as its IPO lock-up expired

XOMA- closed near a low in reversing recent gains

LAS- closed near a low amid updates on new Beijing traffic control measures

Earnings:

None today

Epiphany Trading, LLC
www.epiphanytrading.com

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

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