For the first eight years after I graduated from college, I had the pleasure of living in Chicago. There’s nothing like the graffiti at Gino’s East or the Lake Shore Drive bike path or bumming around Wrigleyville when the Cubs were in town. I also remember the frigid temperatures and snow bursts. In one (admittedly unusual) storm, I fell asleep fairly early on New Year’s Night 1999 and within 24 hours, it’d snowed 21 inches. I remember the city as being ostensibly crippled simply because the town is so very spread out. In any case, one of Chicago’s unofficial nicknames is the Second City, but really it’s not when it comes to finance. Among the exchanges there are the Chicago Board of Trade (CBOT) where agricultural and financial contracts are traded as well as options and futures contracts on financial instruments such as gold, silver, and U.S. Treasury bonds.. Chicago Mercantile Exchange where several types of financial instruments as well as currencies and commodities are traded. The CME has the largest options and futures open interest of any futures exchange in the world. Well, because of the intense blizzard in the Chicagoland area yesterday, the CME and CBOT had a rare delay in the start of “open outcry” trading plus many people could not get to work, simply put. The thing is that in this interconnected world, stock futures and equities tick lockstep (with
moves oftentimes caused by other financial instruments). Now it is true that we in the Northeast had our own ice storm with some delays this morning as well on the trains and such. But the fact of the matter is that with nobody around to man the futures (other than a few automated programs), it set the stage for a very dull session as the futures weren’t there to guide the cash market. So while paralyzing snowstorms don’t occur very often in Chicago, for those who didn’t realize, do know that movements (or lack thereof) out of the Chicago-based traded financial instruments have a major impact on the deltas of the stock and other assorted markets.
Markets were generally quiet in Asia with most of the continent’s markets closed for the lunar new year. In Europe, markets are down slightly with a bit more of a hefty loss in Paris. Oil is up ½% and gold up 1/3%. The dollar is notably stronger (up a full euro) with bonds notably weaker (yield on the 10-year above 3.50%). Jobless claims came in a touch worse than expected. Factory orders (-0.7%) and ISM Services (57.0) are due out at 10AM. Futures are somewhat down but off of lows. With the unemployment report tomorrow, things will likely remain fairly quiet today for the broader averages. The focus will be on the tremendous earnings flow almost exclusively and selected relative strength and weakness plays.
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
EPOC- closed near a high amid debuting as an IPO
SCON- closed near a high after successfully producing 2G HTS wire samples
ARW- closed near a high after posting earnings
UIS- closed near a high after posting earnings
TWX- closed near a high after posting earnings
ERTS- closed near a high after posting earnings
APKT- closed near a high after posting earnings
WFR- closed near a high after posting earnings
ADS- closed near a high after posting earnings
MGIC- closed near a high after posting earnings
MCP, REE- closed near their highs
MTW- closed near a high
MLP- closed near a high
FSLR- closed near a high
SNDK- closed near a high
ARMH- closed near a high
DEPO- closed near a high
ALJ- closed near a high
YUM- decent earnings
HIG- decent earnings
CELL- decent earnings
GMCR- great earnings
SGI- great earnings
OTEX- good earnings
LNC- decent earnings
NETL- decent earnings
NWS- decent earnings
CINF- decent earnings
SFLY- great earnings
UNM- decent earnings
SMCI, IPI, PZN- mentioned on “Fast Money” last night
CMI- mentioned on “Mad Money” last night
DARA- CEO said ‘big pharma’ is interested in its KRN5500 candidate
BJ- announced it is exploring strategic alternatives
HNSN- inked licensing pacts with Phillips
AN- decent earnings
DOW- decent earnings
CAH- decent earnings
DO- decent earnings
IP- decent earnings
EL- decent earnings
POL- decent earnings
M- decent earnings guidance
ARO- decent earnings guidance
NYT- decent earnings
ROST- good earnings guidance
Bad-The following stocks have bad news and/or a weak technical pattern
NLC- closed near a low after posting earnings
BRCM- closed near a low after posting earnings
AOL- closed near a low after posting earnings
CHRW- closed near a low after posting earnings
ARM- closed near a low after posting earnings
KRA- closed near a low after proposing a notes offering
LZ- closed near a low after posting earnings in an island reversal
MGA- closed near a low
V- poor earnings
BYI- poor earnings
CNQR- poor earnings
THQI- bad earnings
ICO- poor earnings
EW- poor earnings
ISIL- bad earnings
AFOP- terrible earnings
BMC- poor earnings
ACE- poor earnings
CYS- poor earnings
RNOW- poor earnings
AMP- bad earnings
ATW- poor earnings
PCX- 11 million share block priced at 27 in the after-hour session last night
CTRN- poor same store sales
CVS- poor earnings
MRK- poor earnings
NOV- poor earnings
RDN- bad earnings
VIA/B- poor earnings
TEN- poor earnings
ANF- poor earnings guidance
TZOO- poor earnings
MA- poor earnings
Earnings:
THURS FEB 3 BEFORE
AMB AN BEAV
BX CAH CI
CME CVS DO
DOW EL GR
HOT IP ITT
K MA MCO
MF MRK NOV
NYT ONNN PENN
POL R RAI
SNA TEN TZOO
VIA/B
THURS FEB 3 AFTER
ALKS BRKS CFN
CSTR DLB EXXI
FISV JDSU LIFE
LPS LVS NCR
PKI POWI PWER
QSFT RLD SIMG
SRCL SUN VRTX
XXIA
Epiphany Trading, LLC
www.epiphanytrading.com
Erik R. Kolodny- Chief Markets Strategist
Brendan P. Byrne- President
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