Earning hits and misses...

For those that have followed us for the last few years, we have written numerous times about how we just do not like the probability of holding through earning.    If this is year 1999, we'd probably be buying calls left and right in front of the earning.   This is 2006 and we think that trading environment has changed a lot since the hay days.    The conclusion is that it is almost rare these days that a stock gaps up after an earning report but frequently the stock gaps down on any slight disappointment out of a report.     Of course, we are using DIVX as an example to illustrate our point as there seems to be some confusion over the earning reaction tonight.

On Friday morning, we noted that DIVX was acting really well a day ahead of its earning report and we thought it could pull a RVBD.  What we meant by that was the fact RVBD rallied over two points right before its earning report.   We thought DIVX could pull a similar move given its connection with google.    Then the infamous Goldman call hits and basically the whole market got dragged down and particularly the tech sector.   So the "rally ahead of earning" play never materialized for us.   Fortunately the stock did perk up late today to provide us still a nice exit point ahead of the earning.     So what happened to the stock in AH?   We think it's obvious that the stock's earning did not meet expectation.    We will not get into the debate of what should be the expected growth number or how much this stock should be worth... etc.   The fact that the stock is down quite bit in AH gives us a pretty good reason to stay away, and to move on.   If this stock comes back and try to attack the old high down the road, we'd be there.   For now, there's plenty of other action that is keeping us busy.

UCTT, so we found out who that seller of the 1.8 million block is and stock rallied.   We are encouraged by its action and think it's just a matter of time before it goes much higher.

RIMM, ah ha, the GS call should not and is not affecting this blackberry monster.   This one is approaching to be a good winner here.

The "A" Team,  APLX, AMIE, ALB, AXR all exhibiting unusual strength today and in fact three of the four logged new high today.

GROW/IAAC, love it or hate it, these are two good stocks to trade and bias is on the long side.

We are almost done with October and we are very much looking forward to the the month of November.    There's historically some strong action in this month and we hope it's no different this time around.   Having said that, we are still going to be looking for the best of the best kind of earning setup and won't get carried away chasing any and every gap ups.

cheers,

Update on Monday, October 30, 2006 at 09:49PM by Demi/ YourPersonalTrader

If you're wondering about the origin of The A-Team, ALB was mentioned in MC as something we'd rather have than AAPL the day after these reported. AMIE,APLX premarket in the extended trading section last week. AXR is one most know from IBD that was a recent high flyer. There are other names we have left up so you can build a list of stocks to watch/trade coming off quality earnings this Q. It pays on days like today.

ATNI-Atlantic Tele-Network

Okay.......simply we didn't like the way some recent DJ Journal stocks started to give up their early gains yesterday...AXR,ALB,IAAC..so we put on our bear costumes and hibernated by noon, but we really want to come out and look around for something new to chew on...here and there...  LMRA, affectionately known as the stinking LLAMA around here, just doesn't fill you up for more than a day or should it...we laughed the hype would come in premarket and did it ever.  This one belongs in and to the Deltas at Faber College, not Harvard.  

Well...this possible chew today is a quiet one, ATNI.  It was a favorite long ago, it has split and has appeared on the Nasdaq recently. It might be to our tastes after its Q report. Revenue 41.3 mln up 66%, net income 7.6 v 4.4m....53c vs. .36c(+47%).  ATNI (19.34 close) has been acquiring assets along the way but these numbers still beat all analysts expectations taking that into consideration. Same rules apply as always regarding going after things for breakfast, let the market show you if it likes it too.

DJIM index outperformed

most of the day big time....You know you're in a groove when AH a DJIM neglected shoots up 20% as you're about to call it a day. Only this afternoon TRMS was setting up after a great EPS. Everything else has been so hot, this one has been placed to the side as it consolidated.  We thought TRMS had the earnings and a story to go with it, today management decided to reveal a new direction...the story behind the new found EPS strength....You also know things are going for you when you're not scouring for the next EPS gem, pre market or AH. Why?...Because we already have them for ourselves and DJIM readers since their first trade after earnings!. Has anyone noticed AAON (nice day), ATNI are probably up 20% since getting space on DJ Journal.  Not bad in a week to two.  A lot of you love the juice of the runners, the EFUT, the CAAS's but for a complete healthy diet, we strongly recommend only one thing around here ( besides not holding into earning).  That is spread yourself out a bit, one day you'll get flushed by a runner and you won't have anything to buy these crawlers with. To us they are crawlers, to the funds that accumulate ...these are sound investments.  The daily speed might not be there for you, but the gains of 25+% in a month, a quarter is nothing to sneeze at. We doubt many places can offer you the experience of finding, trading the momentum stocks as well as the ones your financial advisor might find suitable for your family book. The best thing is we hate "RED" and avoid all to see such in one of our buys. The worst thing we could ever do is procrastinate, its not extensive DD'ing, its the action, the volume that gets us in most stocks. The time lapse between finding something we like and the time we pull the trigger, is quite short... but this doesn't mean chasing a stock without getting the 'feel for it.  This is how we avoid the "RED".  It is also the confidence in seeing and doing it all over again. This is the same confidence that rubs off on many readers of DJIM that have been with us for what is probably 3 years now.  BT is one of them we're happy to say. Charts paint a history, the stocks characteristics are embedded. This is why we recycle,(TRT most recently) our hitlists/ watch lists rarely take up more than one screen to get the job done.     So what happened today........Confidence, experience told us we'd have probable gaps for EFUT and CAAS...we've seen it and crazily feel it sorry to say..lol..we have no life...Its never too late to buy in the last 10-15 minutes, it is actually the best time for us in adding a position.  CAAS was $10.30 or so when we said a gap was probable, a gap is not the thing you see only in the morning open.  It is a stock running to 11.70 AH as well.   EFUT, we were confident in putting it up back to back on closes at DJIM.  We said this was something else, tonight we're glad to say its someone else's.  This is not the bread and butter of DJIM, we wrestled the idea of even mentioning it Friday..but felt comfortable with the gap idea end of day.  A $2 track or lotto ticket is all we would place on it short term as of this afternoon(MC).  Incredibly the insanity of watching, dealing with EFUT didn't take away from watching, trading other DJIM stocks. The super ninjas muscled out their cheaper cousins, the C-team of Chinese stocks. EDU, MR outclassed the bunch and finished the day with NCH's..each up about 10% at the highs. There was GROW getting the 'volatility' management just loves;)...DLB a quiet 3%, TRT unfortunately gave up the highs..guess its best to see the charts for the rest of the story of the happenings around here...oh AXR recently mentioned as part of DJIM A-team with AMIE, APH (back to $69), we were a little too full today to enjoy this ride, hope some of you caught it!

Boring day...

It felt like a pretty boring day to us...a calm before a storm?   Major indices didn't do much of anything and most of our DJIM stocks pulled a sleepy one as well.    We can't put too much thought into today's action,  it isn't a bad thing to have everyone's enthusiasm curbed a little.     However, there are a couple of stocks worth noting and we'll just get right to it.

AXR/BIDU,  this pair is also getting some momentum carried over from yesterday.   Again, we liked the action today and added a little to our existing position.

GROW, one of the few games in town today.   Although we feel that the "easy" money has been made, it doesn't necessarily mean that "fast" money can't be made from this one.   This is, however, one of those stocks that only a full time trader with experienced trading background in this sort of play would attempt to play actively here in $50's-60's.

BTJ/ALY, this pair all closed near their day high and we are liking it for some further momentum.   The key, again, is to keep an eye on the overall oil services sector.

POWL, we are putting this one on our radar b/c we really like its earning reaction and it sort of reminded us of ATNI, in a way.   It's thin but it can be rewarding. A few small cap crawlers have given up their early gains following a earnings report rather quickly lately..EXLS, REXI.  We decided to let this one cool off and see how it performs day 2 and 3.  Btw..maybe not a bad time to start looking at ATNI again around the 9ema.

Many DJIM stocks have held up very well considering the choppiness of this market,  we are looking forward to tomorrow's action.

All the familiar ones...

This has been the theme throughout the the day, and throughout the month, so far.    Stocks that are going up today are those that have been trading near the 52week high during the last little while.    It definitely pays to have a watchlist full of strong stocks.    In our case, it's the DJIM list.   Here are some highlights..

ZOLL, this looks like a clear breakout today with respectable volume.   We added a little and feeling the move up is far from over.

MR, we are simply too tired to mention this one every other day.  This is a good stock, period.

EDU/HMIN, chinese stocks are definitely catching some fire today.   Both had a new closing high and that always spells potential momentum.

AXR, yes it's volatile and it can drop a few bucks intraday, but it can also be rewarding and trade up 15 bucks.    The key to trade a stock like this is to recognize the trend.   The trend is up and then it doesn't take a genius to know what to do, the rest is up to your experience and instinct.

There are quite a few others that made new highs and we are trading some of these moves.   Interesting movers include HRT LXU FRD GRRF CAAS....

ALY, BTJ,  we discussed their failure to avoid the trend Friday, well today it couldn't it fight it and $61 oil any longer, we reduced our exposure for the time being. $63+ is again showing its resistance.

No complaints with NCH's...

...the NCH's, new closing high list is long today for DJIM closely followed stocks...AXR ALY BTJ GROW JST REXI ROS ZOLL..intraday highs for POWL,FTEK

If you had to find some faults of today's action, you can say that FTEK reversed hard intraday and IPSU or POWL did not follow through the way it did the day before.    Have those three plays met our trading objective?  Hell yeah!    It's apparent that up until now, we can conclude with everyone that the key for each and every one of our plays is to find them early and get in early or wait for the next leg up.   When it comes to selling to take profits or cut losses, unfortunately everyone has their own threshold and emotional tolerance and discipline.   We like to take profit a lot and trade along the trend.  When a stock stalls or reverses, there'd be lots of sell signals and plenty of time for us to act, and such is the advantage of sitting in front of the screens all day.   Only you know when you've had your fill and its time to move on.    Ok,  here are some stocks that didn't disappoint...

ATNI, volume perked up considerably today and half of it is due to a block trade.  Nonetheless, we like its action and its strong move above 9 ema may suggest that it's ready to challenge its old high.   We got back in some.

ABM, what a surprise!...well, not really as its a blast when institutions (80% in ABM) want to play your side and buy as today.   This one was alerted yesterday due to their earning but today's action felt as if the earning came out today.   This one had strong action throughout the day and we like this one and thinking this one may no longer be a sleeper mover. Again..this is a lesson in not chasing the open, if you are not experienced enough to make a call, don't do it.  Let the market tell you when and if its worth a ride.  patience paid of nicely with IPSU, ABM

OPTM, we alerted this one earlier today and even though it did not close at the high, the late push was encouraging to see.   Say what you want, this one is also an attention grabber today.

GROW/JST/ALXA,  why do we group these three together?   Because really, those three only trade off momentum, nothing more.   Since momentum trading is what we do the best, of course we had to alert them late afternoon to all just in case they close well.   And they all closed well.

The bottom line is, if you get into some of these plays early enough and apply a proper selling strategy, a hard reversal intraday should not hurt the play that much.    Even if you did get caught and took some losses, there's really no need to get hung about it and just accept it as part of the game and move on.   There's always plenty of good action waiting for you here,  and that's also the reason why we rarely bring back our past plays (TRT) to our watchlist, unless they come back and challenge the high again or have some PR to kick it up. Too many of you fall in love with a stock and miss opportunities day after day because your money is tied up.  We can see by how many clicks the TRT chart gets compared to a flying AXR.   Move on people, TRT was here at $8 and then 12+ , AXR is up 25% since alerted here 8 trading days ago, what has TRT done the last 8?

DJIM hold/ hit list #18

In last weeks #17, we said we're not finished yet with this market in 2006.  Last week showed our resolve to keep finding the 'trade' despite an already fulfilling year.  The market just keeps feeding us DJIM type trading opportunities and we don't want to stop feeding it.  The exodus of players beginning this week for the holidays favors our type of play going forward as the volume creeps lower. The next few weeks is 'easy money' time,  we are only looking to add to the gains of '06...not diminish them with unnecessary risk.  This is not the time to look for the 'hard money' play that could tick a few percentages off your return.  This is not the time to think...hmm..this one could be a winner down the road and take a stake in it,  this is the time to play the momentum when you see it.  What are we talking about?.  Well, we gave it out all week!.  If you look at Fridays action, if you look at the NASD chart you can see the divergence in the money flow..what you are seeing is profit taking year end.  Where do we not see this?.  Clearly by Fridays action, it was in DJIM stocks.  While the distribution goes on elsewhere, DJIM stocks are getting our cash and many other dollars that are giving these stocks momentum.. bringing in the herd.  This is what we will continue to seek out...the positive money flow and/or where it might go.  These types of plays include the possibility of runners like GROW, JST given Thursday afternoon and then the subsequent momo the next day. 

Although earnings season is practically over there are a few names coming out with EPS, maybe we will get a couple more sweet ones before the year is out.  Last week we alerted to two we liked, IPSU and ABM and with a little DJIM patience we gave a follow up alert on each minutes before the big moves. The other grand move had to be the word on POWL at $28 and then the run..okay walk to just under $34, not so bad was the pick up of OPTM at $23.   Besides JST, AXR also had a 20% week. This one was a recent alert at $98 and continues to thrill closing at 129.  Hopefully,  some finally see the promise in buying a stock at $99 and not only $9.90 after the RIMM ride from $99 to $140 and now AXR's 30% in 10 trading days. 

We will continue to be selective in our choices going forward and yes... if we get more quick 5-10%-20% at this point on individual plays, we will take the profits as so should you. For more current plays of interest ROS, ATNI etc.,  just scroll down the Journal.

Short term bets into '07..

No M&A activity is going stop the distribution, profit taking we touched on last night on the NASD.  Add on head banging resistance and you get a 42 point swing from hi to lows of the day.  Some of this showed up in DJIM stocks and a lot of it didn't. You could say a few deserved some profit taking.  AXR and GROW shot to $137+ and almost $70 respectively, both about 5+% above Friday's already somewhat extended close.  You could throw JST into the mix.  Basically the 3 biggest runners exhausted themselves as the NASD turned late morning.   Excluding the oil related issues, AXR/JST sustained the most pain.  There was little pain elsewhere among DJIM names as most finished green..barely ...but green is green!.  The great thing about that is if you scare easily, today provided you with an opportunity to sell your stock near a top while the rest of the market struggled ..

ATNI ZOLL OPTM and almost all the NYSE stocks closely followed at DJIM...DLB MBT VIP closed green.

The best of the day were ABM, which kissed $24 and finished up 2.5% with a NCH.  The other is ROS which tacked on another $1+ and a new NCH. These two definitely have some new found interest out there, we're not the only ones liking how these are trading.

Todays action started with a decline in the small caps but eventually the large caps took over.  If this round of selling continues, never forget your stock could be next.  In small cap land,  they sometimes fall like dominos. The best performers take it hard and those are most likely here at DJIM.  Luckily, this market has had the dip buyers at every turn to support any tumble. It shouldn't be any different into the end of '06 if this was to occur.  We are just leaving it to short term bets now, not too many sleep overs for us.

..wake up Nasdaq...

We are not going to overkill the market in this late stage. Instead of reacting to every economic number and every fed blurb that is toying with investors, we are simply sticking to our weekend words.  We are looking for the easy play, the easy money without being nicked.  The short term bet, trade is on and speculation/momentum is what we are after.  The market made a strong reversal yet the Nasdaq still finished red on the Fed speak.  We're glad to see the strong rebounds in a few DJIM names, but we are not going out and buying the dips aggressively.  Instead, we will wait and see if many of these get can get back to recent highs and then decide.  At the moment we are into plays like the ESCL.  How long you stay with one of these is not the question, it is how much profit you can get from them.  We traded ESCL a few months back close to this price and thought that  'crazy'  had the same potential today.....its' simply in its genes!.  Last time this craziness extended into day 2, despite a nice run from alert time at $7 and a few pennies to over $9, we've kept some in case the loopy money has further to go.

The other buy was FFHL, an IPO from China with a very nice float of just over 3mln.  Considering this is becoming retail traders week heading into the holiday, we were anticipating some of their memories of EFUT to kick in...ours did!.  We can't make predictions and the EFUT's come around once a blue moon, but if this FFHL is a fraction of EFUT ...it would be the easy money we are after now. We watched it trade with a few other IPO's today and had no problem giving out a alert in the low 10's. Usually an IPO has some turning over to do before it makes a move, we were hoping it skips this step and gets momo early. Judging by the AH trading in the mid 11's, a rarity for a IPO...this might be getting some attention tomorrow. Hopefully this will have a longer shelve life than ESCL.

There was some comical action today...unfortunately it wasn't for those that had their stops knocked out. The offering was quite small even for a JST share count and the money was going to a good cause...expansion. The wash job to $19+ was a joke.  Many of DJIM readers probably sold off yesterday and missed the sweet dip opportunity..we did for the most part.

The dip buying could be quite nice as seen in POWL  AXR especially,  but we are concentrating on those still playing around highs if adding shares.............OPTM was one today as it closed with a NCH.