Ahead of the open, (08-02)

Minimal losses on Monday, minimal gains on Tuesday. One common factor from both days is dip buyers are not far behind any downside move.  Unfortunately for many of the underinvested wanting to be in the game,  it’s not a patient bunch out there buying the dips.  This makes every pullback extremely shallow.   So far in ’12, this market will not come to you, you have to go get it.  Slowly, but surely the market is working itself to the initial target off the SP1327 trend-line break…”(eventually to SPX 1350’s this time, if it occurs)”.

A relatively quiet start to the week on the macro and corporate front is helping out the directionless trade. Today, if anything, Bernanke echoing last week’s testimony and not ruling out QE following NFP# was enough to turn this market off day lows.  Not much on calendar until Draghi/ECB (Thurs.) and Bernanke speaks again on Friday, (but this time it’s on housing, which might be more important in its relationship to QE/MBS).

A slew of decent earnings to consider this week, some familair past names from here, HAR in '10, TDG a breakout play in '11, 

Ahead of the open, (09-02)

What do you say today at markets close that hasn’t been said all week?.  Well, the daily gains/losses on the higher beta Russell 2000 pretty well sum it up. (R2K ~-3 on Monday: -1 on Tuesday; +1 today at close).  As far as the intraday shenanigans, the market basically gains a few points on ‘optimistic’ Greek headlines and losses a few points on new postponement headlines!.  Unfortunately or is it fortunately, Greece has not been a market ‘factor’ to trade on or off here during the rally.  Maybe, we should just be patient and relax as the pace of gains so far in ’12 can’t go on forever, but this grind is difficult after being accustomed to the high volatility seen last year. Unfortunately, these 2 factors are probably keeping new money out of the market right now. On one side, the investor says these gains can’t keep going, so we’ll wait for a nice dip/correction, while the other battered and frightened investor says, it’s inevitable some bomb will still detonate in Europe!.

Anyways, next few days will be about Central banks speak (as noted last few days) to potentially move the market.

So, what to do in a flattish market with no clear leadership and/or sector to lean on?.  Where’s the alpha to trade on a daily basis?.  Well, it’s not far away , it’s in the earnings reports.  At this point, picking out winners that can be traded initially off a report and/or Shadowlisting going forward in ’12 is the general idea.  Today, HAR/TDG tacked on 4pts between them on day 2 after earnings showing you don’t need to jump on immediately following a report and/or on the gap.  Recall, LQDT gained 9% on day 2 after being posted following its first day of trading with report out.  As far as stocks posted before opening following earnings.  If you can’t trade them fast and take profits early as in high betas like PMTC  MKSI  that spiked and soon relinquished gains, you’ll have opportunities later to get in on a pullback. (ie. today PMTC made a fresh high). Primarily, this is why single stock alerts are not given out any longer, it’s a matter of ones comfort with jumping in and chance a high beta like SIMO  effect as well.

Overall, one thing to watch now is if ‘bigger’ cap names that report burst out of the gate, but soon after give up those gains. This will be a sign the market is getting fatigued with investors looking to take profits now and not chase.

Update on Thursday, February 9, 2012 at 08:39AM by Demi/ YourPersonalTrader

Now TLEO goes, SABA (up >50% since Dec note), KNXA were plays off SFSF deal and could be again.

 

 

 

Dec 5th:

SAP / SFSF deal summary: SAP announced on Saturday that it had entered into a definitive agreement to acquire SuccessFactors  for $40.00 per share representing a 52% premium.

 

TLEO KNXA SABA