If one child was born, there would be two possible outcomes of its gender- boy or girl (2 to the first power). If two children were born, there'd be four combinations- boy boy, boy girl, girl boy, girl, girl (2 to the 2nd power). Well, if there were 68 children born, there'd be 2 to the 68th power of combinations- a number that is ostensibly hundreds of billions of hundreds of billions. Why do I bring this up? Today is the first day of arguably the greatest spectacle in American sports- the NCAA tournament. There are 68 teams in this year's edition. Now, we all know that not all combinations of bracket-filling are equal. I mean, the likelihood of the four 16 seeded teams going to the Final Four is much less than the four 1 seeds making it. But still, the odds of a perfect bracket are quite low (i.e. if everyone on the planet did a bracket, the odds of someone having a perfect bracket are almost infinitesimal). Yet it doesn't keep most of us from trying to have one! I note all of this because combined with tracking one's bracket, there are many New York area teams in the tournament this year so interest is particularly high. So much so that TV's will be tuned into the games rather than CNBC for the next two days. Thus, after 12:30 PM for the next couple of days, expect much more illiquid trading particularly today what with the St. Patrick’s Day parade occurring. Price movement may be muted or it may be exaggerated (particularly with options expiration tomorrow) but it will likely be done with many fewer participants than normal on much lower activity than normal so be sure to adjust your strategies to the lack of volume. And good luck with your bracket!
Well, we had a full week’s worth of action since the 4PM ET close of NYSE trading yesterday. Last night about 5:15PM, there was a flash crash of sorts in the currency markets with the dollar declining three yen plus. Tokyo finished down only 2% though with Hong Kong down similarly. The trend shifted in Europe though as the ‘worst” did not happen overnight in Asia. European bourses are all up over 1%. Oil is up over 2% with gold up almost 1%. The dollar remains weak. Futures. Futures. Dow futures were down well over 100 points last night but are now indicated ahead 100 points. For the day, the headlines will once again tell the tale but it looks like short covering and the holiday spirit of the day will rule the roost. Most of the volume should take place by 11:30AM with action shifting to the parade and St. Patty’s day activities. The focus will likely be on earnings plays (LULU and FDX), solars, energies and coals, and relative weakness plays particularly at the open.
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
FTK- decent earnings
GRRF- decent earnings
CLF- featured on “Mad Money” last night
AXK- closed near a high
ADES- closed near a high after the EPA a released air toxics rule expect to create growth for the company
PANL- closed near a high after posting earnings
VRA- closed near a high after posting earnings
Bad-The following stocks have bad news and/or a weak technical pattern
GES- poor earnings
PEGA- poor earnings
FUQI- in a government filing, it indicated that its accounting statements are unreliable
NRP- unit offering
GMR- warned on its earnings and indicated it was in discussions with lenders to increase liquidity
LGL- closed near a low after posting earnings
HNR- closed near a low after posting earnings
GAME- closed near a low
SANM- bad earnings guidance and CEO resigned
LULU- poor earnings
Earnings:
THURS MAR 17 BEFORE
ATU FDX LULU
ROST SOLF WGO
THURS MAR 17 AFTER
IHS NKE
Epiphany Trading, LLC
www.epiphanytrading.com
Erik R. Kolodny- Chief Markets Strategist
Brendan P. Byrne- President
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