What to cheer for?

As soon as the 10am CCI# was out, our window dressing bid pretty well came to end.  Following a positive Michigan # on Friday, this CCI was a disappointment.  By close we gave back a portion of yesterday's gain on heavier volume,  still a pretty good showing given how light the volume was yesterday.    What concerns us now is what happens as this Q window dressing winds down and what October has in store.   Well, we may have a pretty good taste of that on Friday from the NFP report and tomorrow (ADP).

Technically, we reversed right at 1057…(yesterday‘s journal)‘..technically impressive is we closed above (1057 Sept 21 low)”.  Not a coincidence today, an important level to watch intraday in your trading this week.

As a whole, this market is holding up quiet well heading into earning season.    What we think is that people have learned their lesson from previous earning Q’s where selling before the earning season is simply a bad idea.    Whether people believe an Economic recovery is at hand or not is somewhat irrelevant nowadays.  Traders are more focused on the fact if companies can deliver positive surprises top- line/bottom line.    Why not?     Since, no one really has any grasp or firm idea how the economic recovery is progressing, the probability is pretty high some companies can deliver some impressive reports while others will not.    In a way, this is fairly rewarding for those who bet on the right kind of companies.  We just won’t do that by holding into reports and instead will look for a move prior to report day.   At this point, two different companies in the same sector can deliver entirely different kind of results.    To deliver good reports, it has a lot to do with management execution, cost control, and grabbing back market share against all of the competitors out there etc..    Therefore, we feel any companies that deliver good surprises have to be rewarded by investors.    On the other hand, you can also forget about those companies that aren't executing.   Cough-cough (RIMM ).  Simply put, not every company can ride the coattails of an early economic recovery environment.

Plays wise, we have …ROVI RTI CTRP  making NCH’s while other plays such as HITK SWM  are setting up.    Keep an eye on AONE  as well, it's a play that can get some excitement easily.   Even though our stance is somewhat cautious, it doesn’t mean trading opp’s are ignored.  Just don’t get caught with too many positions or sizes too large to handle.  At the opening bell, we alerted a possible move in the Shippers (GNK DRYS ) due to Cosco words.  By close these names were the near the top of our shadow list by % gainers as this report spread on wires.