Over and above the classics like “All In The Family” and “Cheers,” my favorite television show of all-time is “Jeopardy.” I cannot speak to the reality TV craze as I (fortunately or unfortunately depending on how you look at it) tend not to watch much television these days, but I do love ‘intelligent’ programs and there’s no game show more challenging than “Jeopardy.” On February 14-16, the show is going to have special episodes featuring two of the game’s most notable champions (Ken Jennings and Brad Rutter) playing against “Watson.” “Watson” is a computer program developed by the artificial intelligence folks over at IBM. This is similar to the “Garry Kasparov versus IBM chess computer” in 1997, but “Jeopardy” is a wildly unique challenge for IBM’s computers due to the intricacies of many of the clues which involves things like puns and riddles. It will be quite interesting to see how it turns out. More interesting (and relevant) for day traders is the impact the storm had on stock trading on Monday. I wrote a blog post on February 10 about a history of snow days at the NYSE:
http://epiphanytrading.blogspot.com/search?q=Snow+Day+%28But+Not+For+Us%29+
However, this most recent storm was different. It occurred on the Sunday/Monday morning of a holiday weekend, was the biggest December snow (in Central Park) in 62 years, and the blowing and drifting was incredible. Yet, the exchanges did not close. Despite the fact that it was a logistical nightmare to get to work, the thinking was that it’d be embarrassing if a tech-based exchange such as NASDAQ could operate yet the NYSE could not open. That said, with many NYSE-floor brokers unable to get into their offices due to the suspension of train service much less subway service, volume for the NYSE (much less all of the exchanges) was the lowest for a full-day session (by a large margin) this year. It makes one wonder whether the exchanges would have remained closed if it weren’t for all of the on-line trading (and ECN’s) much less the fact one renegade exchange (say EDGX) could have opened in making the ‘big boys’ look bad or at least made noise about wanting to open (which would have had the same effect). And that leads to my point. Ostensibly, the only true traders and brokers who were working on Monday were those who had access to electronic means (whether in the NYC metro area or elsewhere). This would not have been the case a generation ago. Furthermore, the attempt to blend humans and technology on Monday led to some consternation as it still takes humans to power the machines- yes- that is true. I mean, how could someone execute orders with a floor broker if the floor broker couldn’t get into the office? Yet, in order to render orders to the technological means the floor brokers use, they people had to be there. The ultimate paradox. It’s not for me to say whether the markets should have opened on Monday- particularly after a three-day weekend. But what occurred on Monday did make one thing crystal clear- machines are pivotal for a modern Wall Street. Yet without people around to operate said machines much less benefit from said technology, it leads to a very dull lowly-populated low-volume trading session- but one that was able to take place whereas 30 years ago that may not have been the case.
Markets were mixed overnight throughout the world. Tokyo fell 1.1% but Hong Kong was up 0.1%. London is flat yet Frankfurt is down 1%. Metals, currencies, oil, and bonds are relatively stable with the most interesting note being that silver is challenging the $31 barrier. Jobless claims data came in much better than expected (388K vs 416K expected), PMI is due out at 9:45AM (61.5%) and Pending Home Sales (-3.0%) are due out at 10AM. Futures are fractionally lower. The tone will likely remain muted with a bit more volume and movement in relative terms as we approach year-end. The focus will likely be almost solely on the microcaps that have been moving from the Chinese plays to the rare earths with an eye on fertilizers as well.
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
URZ- closed near a high after completing a $20 million financing
XING- closed near a high
PULS- closed near a high after receiving interest of a prospective merger by Bel Fuse
SHZ, MCP, REE- closed near their highs
POT, MOS, MON, AGU- closed near their highs
WLT- closed near a high
CHGS- closed near a high
TWER- closed near a high
GCFB- closed near a high after getting new financing and investment from a new ownership group
QXM- closed near a high
ENDP- received FDA approval for Fortesta
MBI- closed near a high
BJ- closed near a high amid takeover speculation
VTG- announced the commencement of operations for the Platinum Explorer
APC- rumored buyout by BHP according to UK’s “Daily Mail”
Bad-The following stocks have bad news and/or a weak technical pattern
AIG- closed near a low
DANG, YOKU- closed near lows
NFLX- closed near a low
CPWM- closed near a low
Earnings:
None today
Epiphany Trading, LLC
www.epiphanytrading.com
Erik R. Kolodny- Chief Markets Strategist
Brendan P. Byrne- President
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