Early Bird Report 1-31-12
Market is gapping up a bit here (7:30 a.m CT), after bulls did a nice job yesterday, stepping in and buying stocks after a gap lower and some mornings weakness. We wound up closing near highs yesterday, just barely climbing our way back into the bullish month long rising channel…and at current premkt SPY prices, we are firmly back. We didn’t quite hit our 20d MA in the SPY…we’ll keep an eye on that for some downside support going forward, as well as yesterday’s pivot low of 130.06. On the earnings front, UPS and LLY are rising in the premkt, as well as X even after what appeared to be a miss. RSH is the sad sack earnings story this morning, down almost 30% after margin pressure caused a big EPS miss. XOM and ADM are a couple of other widely held names trading lower in early action.
Gapping Up– HOLX RTEC MAT HP LLY X MCP UPS MCK PRXL TGI MHP PAL
Gapping Down — RSH XOM ALGN PFE RCII ICUI PCL AEIS ADM BIIB AVY KLIC
No indication — SLG HRS DHR TYC CIT PCH OSK TECH LXK LLL AXE ITW
Watchlist: This is a breakdown of stocks w/ certain technical characteristics in light of yesterday’s action, NOT a recommendation to Buy or Sell. Always consult your own registered broker/advisor before initiating any positions.
Under $10 long momentum looks with strong closes/actionable charts: SIGA PIP SPEX GNOM GTAT NGSX FUEL CCIH MELA AFFY YMI VG CDTI NNBR SKH
Over $10 long looks w/ strong closes/actionable charts: ROVI RBC WSM NKE ABD INVN ATU DELL IACI MON SBUX COO END
Weak closes/weak chart: ACXM FIO VRTX WLP BG QCOR MDU LEG CTRP
Trading up to MA resistance:
20d: TF ISRG
50d: AEO TSLA ORCL CME
Trading down to MA support:
50d: AMTD XEL
2od: TOL SREV AVP HRB LXK PAYX COL
GoPauseGo Candidates: BIDU ARQL RPTP WBMD P BGC LNG SYNA TSRA SIVB
Current Positions in our Ditto Traded Mirrored Swing Account:
Long VPHM from 29.58 (1/2 of original position…sold 1/2 at 30.80)
Long HEK from 5.15
Long ROVI from 30.85 (1/2 of original position…sold 1/2 at 32.20)
Long ATHN from 58.86
3 ideas for today’s trading day:
These are ideas…. NOT recommendations. Often times I trade these setups, many times I don’t…dictated by market tone for that day. Complement these ideas with your ownresearch before making any trading decisions. Always consult your own registered broker/advisor before initiating any positions.
1.) Traditional long: P
What stuck out most to me is the tight inside day yesterday after the big surge into the close on Friday….the crazy tight range yesterday was 13.47-13.76. I will watch it through yesterday’s highs for a possible entry, as well as through Friday’s high of $14, which would represent a broader range break. The nice thing about this trade is the relatively low risk…I won’t be in below yesterday’s low of 13.47.
2.) Traditional short: BG
This stock has been a real dog lately…it wasn’t able to break a bearish channel this month during a strong market tape, and now is breaking down below it. It is trading underneath a multi-month TrendLine, all of its relevant Moving Averages, and could even see some more weakness on the heels of poor earnings from peer ADM. Will eye entries on a move through yesterday’s low of 57.12 if possible. Would only want to be short this name today if it stays red… won’t want to risk a sharp reversal if it the market is strong and this manages to go green.
3.) Small cap or sub $10 momentum: GNOM
I’m sort of torn on this one. The elevated volume levels in the name certainly have me interested. The close yesterday makes me a bit nervous, however. The 3.00 level was a battleground in the name Friday and midday yesterday, as buyers finally took out a large seller at that level. I would be a little more comfortable buying it today if would have been able to close above that level. Instead, it limped back through there into the close, suggesting that many of the buyers were retail and momentum traders, rather than institutional. I’ll be looking to get back in the name if it can get above that 3.00 level again, and most importantly, if it continues to see the elevated volume.
The creation of this morning’s Early Bird Report was helped by the music of The Pharcyde