Monday, July 20, 2009


As we continue to plow through a very robust earnings season, we can see the power of the almighty TREND.

Stocks continue to get ramped and reramped up into earnings. CAT got upgraded today with earnings due out tomorrow (shocking coincidence, I am sure!).

We need to watch closely as we run through the season, if you pick the right spots you can pick the right stocks. It took me a small while to catch up but now we're looking at some rushes into earnings as more and more stocks "beat" their deflated #s, giving rise to hope that things are getting better.

Perhaps they are, perhaps they are. Let's hope so. I have to say I feel almost naked not being short anything at all, its like someone took all my clothes off and since clearly no one would do that, I must be dreamin'!

Want to thank Lisa Chase for having me on her Political Chick show, was way cool and glad some of you called in. I love doing live radio, its very cool and a lot of fun.
Maybe I'll do my own show soon, ya never know.

I don't have much commentary here other then watch MS early in the day for a potential move into the close into earnings. The stock, however, is trading VERY weak and is trading VERY suspect in terms of how it just can't bust out despite GS earnings and JPM, etc. LM blew out and was up nearly $2 after hours and still MS didn't budge. So...we'll see. $30 is a very key level for MS. It's just not showing any strength here and instinctually I tend to stay away from stocks that trade like this into earnings. I own some, but any spike and I am way gone. See, stocks will often give you "tips" and you need to heed them. Fighting the way a stock trades can be hazardous to your health.

I will say that it's quite disheartening to me that it appears we are setting up for the same situation as we just got out of. JPM and GS are now fast becoming the behemouths and certainly "too big to fail". I thought the idea was to change things so that that doesn't happen again. Guess not. Apparently its great that two firms are sucking up the profits and the glory and that one of them was at least partially responsible for what happened. It's quite amazing that we continue to reward the bad behavior of the banks and that they were bailed out and now many are giving crazy bonuses. Did someone say the American people are suckers? If not, they should cause babies that's what we all are here with this. Astounding.

I wanted to also just comment on trading in general. I get asked a lot "Michael, is it really "THAT" easy to trade? My answer? Yeah, it is, its very easy to learn to trade! What its not that easy to do is make money consistently and to limit your losses. Losing is a BIG part of trading, in fact I said it tonight on air radio that if a good trader makes a million dollars it may often mean that he lost $2 MILLION! HOw can that be you ask? Cause simple math, if you make $3 MIL and lose $2 MIL then you NET $1 MIL.

I never stopped to figure that piece out for myeslf but I am quite sure that I've lost many many millions, but am still millions ahead of the game and in the black. This is a marathon folks, let's not forget that. this market ain't easy. Sometimes the market is like raining money, this isn't one of those times, though if you pick your spots you can do quite well. Quite quite well, and that's ultimately what we aim to do, we aim to pick our spots and try to capitalize on the moves as they happen, rather then after they happen. Trading isn't horseshoes, its not an "almost" business, its very real and its very exact, or at least as exact as losing $2 MIL and making $3 MIL can be!

let's keep the steady market going here, if you stick to the plan you have opportunities and thats all the market ever really promises. There are no sure things in life, or trading. Peace.

See ya on the other side,



Wednesday, July 15, 2009

Wowsa, so much for Head and Shoulders...

Ya know, its a very good thing that I'm not a technical trader. The only thing I know about head and shoulders is that it's a shampoo! Da Dum Dum. Oy vey.

Ok, so that was bad, but I have to tell ya, this is why TRENDS RULE THE MARKET, and WE RULE TRENDS!

We are getting a CLASSIC earnings run, and we are taking advantage of it nicely here! BAC, GE, PRU, JPM, GOOG, MS, all stocks and options we've owned here into this and out of it and the ka-chingos are rather frothy! VEry nice indeed!

It's always amazing to me. I had a couple of bad weeks, admittedly, but I never doubt my abilities. Someone wrote me today saying "I thought maybe you had lost your touch". Maybe that'll happen one day, but the cool thing is, it hasn't yet and even if so, hey, I still have taste and smell to rely on! You didn't know Henny Youngman was still alive, I know.

OK, so enough with the one liners. Thing is, this market, if you are patient and pick your spots is a GREAT trading market. We were just treading water and its easy to overtrade when that happens and its a very tough market to trade then. But, out of the calm usually comes the storm and that's what we've gotten. HUGE moves two out of three days this week and I've said it again and again that I just didn't see how the market was going to die here through earnings without some really bad news. The market is still heavily shorted and any good news is going to be met with extreme short covering.

Also remember, this is options expiration week and moves tend to be exaggerated and pin action is in play. Look at stuff here and tomorrow for clues as to which way we will lean, and which way stocks will go individually. We should get some nice setups for short term trades.

TOmorrow GOOG is on tap after the close. Before the open is JPM which will set the tone for financials. Remember, they are overbought here, so a gap up is not something I would chase, stick with what ya got and ride 'em Trend Traders!

CIT getting a bailout, when does it end? Soon we may have more companies bailed out then companies that are in business!

Watch CME here, if it squeezes it may try for $300s in a jiff. Stock bounced today but on a pullback would be an even better entry on no news. We'll see soon enough!



Tuesday, July 14, 2009

Earnings rockers...

GS blow out
INTC blow out
If ya had to guess, you'd have to think there's gonna be some nice blowouts from the likes of GOOG, AAPL, etc.

Market way up afterhours on INTC earnings. GS still using $150 as STRONG resistence, even with the HUGE blowout it couldn't yet bust out of that price. The gap up tomorrow should be interesting and should set up some nice short term trades for those patient enough to pick spots.

As I've been saying for a while, this is a tough market to short for more then very short term trades here. We will crash and burn but its unlikely to happen through earnings period here, which means picking your spots should pay off mightily. I'm looking at some really nice potential Options plays for next week or two. Watch energy, Oil may get a nice bounce over the next week or two off the $60 level if it can hold here there. I suspect it will and am looking at upcoming earnings in the energy sector to play.

Not much else to talk about, the hearings on Capital Hill remain problematic longer term but give hope short term and right now this market is trading on HOPE.

As you know, to me, HOPE is a four letter word for traders, BUT that doesn't mean we can't catch some nice moves.

Watch KLAC off the open on a dip, they have an analyst meeting it appears today and should be "in play" until that comes off, and maybe after as well and might be worth a flyer early in the day off INTC and into their conference.



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Monday, July 13, 2009

There ya go...

The market awakens!

Lo and behold its during earnings season, who knew? GS racking up big gains, as were rest of financials.

We owned MS, so very nice, also BAC and now GE. Key here is what GS does first in terms of the estimates,and secondary as far as the stock action. If GS blows out, which seems likely, and the stock sells off that is a very bad sign. If they blow out and the stock goes up $10+ or even $20+ then thats a sign things are and should get better, at least this week!

Earnings plays are working, folks, keep your eyes and mouth open for clues of what to do and where to go.

In the meantime, I think watching AAPL and RIMM is a good idea for further up moves. AAPL I think reports next week.

It's late, I will try to post tomorrow. I think all eyes are on GS, hail, ice and sleet are wrong. The question is, does it thaw or just plough ahead!