...and we got ourselves a toro bravo (fighting bull). We said he ain't dead this weekend, Tuesday was proof....and you know what?...the bravery, performance surprised not only the shorts, but even some of us longs....the scale of it in one big swoop as the bloodied bull fought back was great to see.
We recently noted this was new skool trading..Oct 26th...and finally we got one of those on the long side.
...."let's just accept 100+ /-Dow and 25+/- point NASD days are old skool.!!! This is intraday stuff now and we don`t think it was a good day or bad day till we see 250 +/-and 50 point days at the close..."
Are we jiggy wit it?...We've had all summer to get wit it and now we will most likely close off the year in the same fashion with volatility!
Lets not kid ourselves and admit this was great to see. It doesn't matter if you made money as many purely gapped. The reason is, if you want to make money going forward on the long side this was the medicine you were looking for. You could not have rolled a better one....This was much better than expected as it came in one nice shot to give the QID's 2x,(-8%) the FXP 2x (-15%) inverse thingy a slow burn...mmmmmm. Somewhat off topic...but if you want to short the market don't do it on day 3-4 of the biggest pullback you've seen in recent history. We doubt many can keep to this game of shorting any index 2x, the FXP 2x without jumping ship as soon as a reversal is in sight or worse a wake up gap up. If you do want stick to this game plan, do it earlier so you get a big piece of the drop we've had since last Wednesday and not go in the following Monday when the conditions are way oversold short term and risk the great possibility of a technical bounce. Too many inexperienced traders are entering these plays and getting burned.
Will this move continue today? ..All that matters right now is it was a 'feel good' day, showing the market is capable of a fight. The bull has some fight in it and this action will open some eyes and most likely bring a better trading environment back.
Before the morning open, we noted we thought the Asian hooligans had some fight in them soon. Soon was yesterday as many led the way...EJ before eps, hey remember WX moved before EPS ...so who's next today?.... We will also get initiations on the STV IPO today, possibly just at the right time. Yesterdays action should bring some life into earnings plays as well, before and after the report. EDU, BIDU, JST CSR YGE led with 10%+ days yesterday and a few followed. The point here is they are not DEAD, not if you caught a piece of the action. The HANG SHANG up around 4% overnight. A note on WX, the expectations were simply too high. After a few months trading this must be valued at market prices to a certain degree amongst its peers in the industry. It is way over the top already with it's PE and had nothing left to do but fall without amazing growth guidance.
In this market, we need to look for opp's that may not be the norm. One example is a QSC or an E-trade. Monday morning, we were laughing this QSC might be $3 the next day if we dont mention it. Guess...the laugh was on us as we saw this late in the day over 2.50 and up over 50% after Briefing profiled it's earnings. Still, not late, even at 2.90 note as it seems to have traded as high as 3.35 AH. What we think is as this trading enviro becomes possibly more difficult, we will turn to some 1-24 hour plays like this as an alternative time killer, money maker. This is something we all can participate in and skin a cat or two on, so as we suggested during the China revolution a month back...give us..the readers your junk and we'll throw in some as well. This is just the idea of throwing something out for all to decipher, investigate as they please. Nobody will judge you, its all speculative..We also have Thanksgiving holiday trading coming up which usually gets some junk flying around as the retail traders play while the desks empty at the firms.
DLB PBR PSEM MELI are a few names of trading interest.