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Entries in SOHU (7)

Tuesday
Feb012011

..joined the march?

Fittingly,  the big downside on Friday noted as purely a ES (futures) move continued its’ shenanigans overnight squarely hitting a low of ES1262 (note SPX 1060’ish technical levels here) and proceeded to crawl a total of 23 ES handles to close as Egypt was signalling some headway at least for today.  It didn't look like a ‘ million man “ES” march’ , but really more like a man or two march given the general quietness of the market.  Ahead of some important Macro data incl. US SM on deck, ECB meet-ups and jobs#,  you hope this wasn’t the bounce discussed yesterday that comes ahead of selling by the ‘man or two’, who marched it up today.  Anyways, the broad market shenanigans are not our concern as our strategy is to play individual stocks off earnings and/or sector rotations.

Shadowlist

  • Momentum/earnings/“winners of ‘10 –   The ‘hiccup’ outperformance of the clouds/ momo/earnings of ’10 played out as these stocks ‘underperformed’ (CRM NFLX VMW down, others just flat), the market today.  AMC-APKT  is one to watch on Tues.
  • Commodities –  The Oily (energy) space ran with ETF’s like USO OIH +2.5%  garnering most of the markets attention. CRR  hit a fresh intraday high at $117, FLS  made new intra’ hjgh before pulling back some late in the day. CLR/ CRK  are previous DJIM Haynesville plays we’re familiar with, so if this ‘energy’ streak continues we’d look for potential trades in these sorts.  Generally all cyclical sub groups (industrials, materials, energy) were helped by CHI PMI.  Note- China may not hike again into their NYears as previously thought, so commods’ should act well till the day comes shortly when we’ll know for sure.
  • Q4 earnings update –  In regards to yesterday’s note, SOHU 4 point gap up and immediate loss of all the points was a little eerie, but it eventually got it all back >5% day, so earnings reactions are still okay.  The market will now become focused on CSCO  coming up for the first real ‘January Q included’ effectSODA  nch, OPLK were the best mid caps listed. *AMC- BIDU IRF , strong earnings to watch.
Wednesday
Mar302011

leaders 'lead'

One again anything that can be construed as negative tilted news was brushed aside by US markets (globally it wasn’t).  We’ve discussed this since the middle of last week as market turns a blind eye, now it’s continuing the trend at window dress up time and ahead of earnings season.  This is same factor at work as when alerted at SPX1250 and said to watch for negative ‘nuke’ news not get sold off any longer, which would be a positive going forward.  Every bit of negative newsflow is seemingly ignored now as investors tolerance has been built up with Macro global issues.  It's perplexing to many.  It could continue until Friday as investors/traders await all the data/QE2 for that day.

The morning ramp can be attributed in part to nobody finding a catalyst overnight (see yesterday's closing note) to close market below the pivotal SPX 1314.  There was no positive catalyst out there this morning.   It was a matter of Performance Anxiety (PA) setting in as managers went after growth/ momentum names.  Remember, these names didn’t participate in the first leg off 1250SPX and really haven’t played a big part of the ‘missing link’ tech (mostly SOX) rush that ensued afterwards.   Momo-linked stocks like FFIV APKT AMZN SOHU and many more simply caught a bid.  As 2pm approached many probably thought the market may repeat Monday’ s late selling due to no positive newsflow, but ‘leaders’ were at work this time with PA being enough of a catalyst and so chance of sticking the SPX gains was a high possibility unlike Monday.  Technically, it was important to get back over SPX 1314 quickly and the icing is a close of 1319, which could be enough for more points as noted in weekend Journal.

Shadowlist

A stack of DJIM names +>3pts as growth/leaders lead the way today.

  • Momentum/ earnings/ winners of ’10-    SOHU +7, PCLN +7, AMZN +5, FFIV +4, (NCH's- SFLY  OTEX)  APKT +3pts  broke trendline SOHU, unleashed a huge move, saw no news, only idea of why isChina Unicom's results point to a strong mobile internet ramp in 2011, as BIDU SINA  act well too.
  • Commodities – WLT +4pts, MCP +4, CRR nch,
  • Consumer-  noted Retail was fine yesterday despite leisure selling,  LULU nch , RL, UA all +3-4pts off recent DJIM PVH +5pt on earnings.
Tuesday
Apr052011

..meandering

As the market meandered near the flat-line in the morning, you as a trader begin to look over the Shadowlist to see any trends developing. What you see today, is what you see many days lately and that’s pockets of strength in stocks linked to any individual news. IE., First hour of trading,MCP  >10% on an acquisition, APKT >5% on target price increases and the flip side SODA down 10% on a 5mln share offering, NVDA on price decrease.  

Unfortunately, a sidelined market consists of days like this as traders jump on anything making news, even if it is as irrelevant as a price tgt increase without an upgrade attached.  Other more important trends were visible and that’s where ‘slower’ money is going instead of ‘fast money’ looking for a quick flip in and out. (see below).  If you pick up the relative strength early on, you can dwindle your Shadowlist trading list from 60 names to maybe 10 to concentrate on intraday.

By trading close, a meandering market continued and the stocks/sec’s noted here kept outperforming and/or underperforming.  Nothing really changed all day.

The SOX once again weighted on the market as the biggest underperformer <1%.  AMC, TXN bought a grandfather of a semi stock for a huge premium.  It will likely be a very temporary boost as pre-announcements possibilities are first and foremost in investor’s minds.

 

Shadowlist

Momentum/ earnings/ winners of ’10 – Last week we noted strength in Chinese Internet related names, once again SOHU BIDU, SINA  were up 3-7%.

Commodities  - Relative strength in Ag’s/ Chems continued to follow through post USDA report.

Friday
Apr082011

Shake, Rattle and Roll on..

Considering the market just rebounded from SPX1250 to nearly year’s highs after an Earthquake, Tsunami, Nuclear fears, you have to believe a 7pt something magnitude quake will only Shake, Rattle and Roll the market back to it's early morning fault line.   This morning’s slide was pure ES/ SPY stuff with little reaction on individual stocks.  Stocks that fell through the crack did so on small volume as bids naturally disappear and scary pants will sell at any level to exit.  As traders, we've lived through enough turbulent moments the last few year’s to know being spooked out of positions is no way to go.  As soon as rationale set in, the market rebounded and was back to the same trends expected here entering the week (waiting on earnings to kick off).  Give shorts some credit for not laying out some conviction by pressing the market off another quake headline.

All in, not a bad day considering Financials only traded inline / SOX succumbed to a little profit taking following Samsung’s report on NAND specifiaclly that hit semi-equip linked stocks, yet SPX posted only an incremental loss.

Shadowlist

Financials  - Not the best day for rotation to exhibit itself due to newsflow. GS  edged over 50ma as sector heads into it’s earnings. Last few Q’s it’s moved into the reports.

Momentum/ earnings/ winners of ’10 –  TDSC,KEYN, finally broke out to NCH

”..there is plenty of money to be taken from other sectors and so it may not last long in high beta momentum because earnings are around the corner. Still, it’s best to be prudent if trying to find a buy point as money comes out faster on the way down then up in this group”.  At least it was good see a few momo names snap back, SINA, SOHU.  MCP , did as well but it was purely on newsflow (congress bill)

Thursday
Apr142011

Up in the air (earnings)...

The immediate morning question was can the market build on the premarket pop and Global rebound occurring overnight. The problem premise here recently is that besides no conviction buying stepping up when we need it, we don’t have shorts laying out exposure in this recent melt up or on this downturn to 20ma to make a move sustainable higher.   So following this idea, logical expectation was once again some short covering early followed by little or no buy conviction at all coming off the sidelines. Therefore, a short covering would only be short lived because there are not enough shorts in the market, no longs to buy, so the bounce would peter out.  An hour into the trading day this was evident as SPX gains were erased, by close it was even more clear the premise once again worked itself out.

In all, not sure who won today!. The Bears should have closed the market lower if you look at JPM, ASML, ADTN earnings reactions (more on this below).  On the other hand, Bulls didn’t get positive reactions off headline #’s which were solid, yet finished at par in the broad market with earnings supposedly disappointing.  Screwy day as cautiousness towards earnings is still prevalent on investors minds, so they wait for more reports to make investing decisions.  Today's results left it up in the air.

Shadowlist

Momentum/ earnings/ winners of ’10 –  , Yesterday it was noted the tech group needs some good news.  All the market got was more mixed signals it seems.  Solid beats and/or guides were ignored and fickle investors found ‘ softness’ somewhere within a report and/or during CCalls. (ADTN was up 5% premkt/ ASML).  Earnings luckily started w/ RVBD  pre-announcement, but ADTN/ASML (noted coming into trading day to watch) couldn’t built on the support for the group.  Tech did get some short covering just as in TXN/SOX bump noted gain yesterday), but that was it as the Nasdaq, peak to trough dropped 28 intraday points midday.

Yesterday….“Still ,some pockets of life today  in NVDA/ Networking/optical were not bad today as the well know names like ALU CIEN did alright …”.  Some of the best tech strength was in these names today, (optical/networking) ALU  >8%, CIEN >4% up , FNSR >3%, along with our closely followed Chinese internet linked names,  SINA  SOHU  BIDU again 3-7% up.

Financials  -  In respect to earnings, same goes with JPM  as with tech reports. It seemed like a solid report for the financials, based on a headline Rev/EPS, but the underlying mortgage repurchase expenses up attracted the negativity and spread to peers.

 

Tuesday
Apr192011

Europe respects solid earnings

Heading into the trading day, cited strong European earnings from a lux retailer and a semi.  This was followed by broad range of companies today… another lux’ retailer, a beer co, a cosmetics co, a drug co powering European markets by US open.  Hum???...Gains despite an escalating European debt crisis ?    At least someone has the right sense, while here in US investors continue to fickle through reports as seen by GS blowout number. (TAG below :’fickle investors’ for more).   Europe results/reactions have probably signalled a change coming here.

As speculated sooner than later this selling phenomenon will end if solid earnings keep coming in. (outside of banks/brokers as it’s a sector ‘want’ within Financial reports that isn’t showing up and doesn’t relate to other sectors). ..”Talk about a fickle crowd again!.  What is occurring so far in earnings might be described as’ sell on the news’, but it’s not the typical we’ve seen in Q’s past.  Market should get over this phase, if earnings keep on coming with solid guidance.”

In all, a good sign was the early morning gains that disappeared, reappeared and tracked on even more in the afternoon to close at day highs..  Many of the names noted from Shadowlist yesterday exploded out of the gate and/or had significant follow through days. Even though the RUT underperformed the indices , the Shadowlist components had very good action as seen below.

 

Shadowlist

Commodities –  Yesterday’s alert on Ag- equip names had a decent day adding on to yesterday gains, MOS POT~4 NEU LNN   will squeeze nicely if this group action keeps up from it’s basing here.  OSN +20%  today. After getting beat up due to all China fraud/ guilty by association, it reported nicely last week with 20% +guidance numbersThe PE on this steel name is crazy so keep watch for bottom feeders here possibly.

Consumers-   LULU   followed through to over $100/4% at the open,  UA  hooked on a for a ride to NCH as well/~4%., RL intraday high.  All these names fall into luxury ‘apparel’ . Burberry earnings today followed LVMH.

Momentum/ earnings/ winners of ’10 –  Chinese internet names covered here almost daily outperformed again, SINA 12 pts intraday, SOHU, BIDU.  IPGP,  here as well yesterday tacked on 4pts/6% NCH.   As far as ’10 momo’s, there is hesitation on names like FFIV APKT VMW ahead of earnings, even after RVBD upside pre-announcement.  Most of these networking/telecom related names were down ahead of JNPR results tonight.  FNSR  was the outperformer linked name as it trades well recently eyeing gap.  QLIK- nch

Big night ahead for tech results, watch if any disappointment EPS' get bought into or we see a ‘baked in/better than feared scenario for signs of semi’ tsunami ending.  LLTC has a big Japan impact, so will watch how it reacts to what it says about the impact.

*Note : you can click TAGS below on site for '11 notes on stocks/ sectors etc.

Tuesday
Apr262011

Not everything a drift...

*Email feeds appear as excerpts, use link to access full text.

Late weekend newsflow out of China,’China to switch some FX into precious metals and energy’, had the PM bugs touting the end of USD.   An hour into the open, the herd jumping on this wire fell off as the trade backfired in most hard commodities with USD, even treasuries lifting.   A symptom of Europe closed for business equals an illiquid FX market, add the fact commodity linked stocks were off very little signalled the markets are really waiting for Bernanke on Wednesday (the decision will hit at 12:30pm/Bernanke hosts a press conf. at 2:15pm). That was the first hour and nothing changed by close, including shares not changing hands.

Consolidation was what we were looking for heading into the mid-week and this was just some of it playing out today with no hard eco’data and earnings taking a backseat to Bernanke.  Tuesday will likely be more of the same.

In all, trading days like this you don’t need to peruse the market drift for stocks to trade.  A glimpse onto the Shadowlist  early reveals enough action to possibly trade just off earnings related information.

ALB , initiated last week off earnings popped ~5pts/7%,  SOHU  had good earnings +8pts, SODA  a price target increase  to $50 /+8%, TZOO +7% on momo from earnings and price target increases. 

EPS reports in the next 24hrs off our list include,  APKT,CMI, ININ, UA, KEYN,ILMN