Basically, when dealing with a market that mocks your intelligence more often than you would ever admit, the only sense that we have to rely on is our eyes. Throw away any predictions and throw away any bias, what you see is what you get and the best movers may not be the ones we had in our mind sometimes but this is definitely the fundamental concept of stock trading. Had we predicted with 100% accuracy with 100% correct timing, we probably wouldn't be trading stocks as what is the fun in that? lol Then what is the important issue here? In our opinion, the ability to quickly spot the ongoing trend and recognize which plays are working better than the others and act on it with a sensible strategy is the key to survive in this market. We think the market has definitely got tougher compared to a couple of years ago. As they say, the tougher it gets, the tough gets going. Market always behaves in a dynamic environment and our trading minds will somehow adapt to this ever changing environment and trade accordingly. The worst thing when dealing with a dynamic market is to be stuck in the yesterday's frame of mind. Plays come and go and change constantly, our methodology will have to be improved all the time to adapt to the newer plays and what's working out there. Ok, lets tackle some of the working plays here....
CYNO, we noticed this one a couple of days ago off their earning report and wanted it give it a day or two to see how it reacted to the gap up. Obviously, gap is being held and that's a very good sign. We looked at it a bit further and realizing this one has a pretty small float and that's another good sign. After checking the IBD #, with 96, 90 A rating, this further ups our view on this stock. So the decision was quick and easy and we grabbed a starter in the low 23s and added more as the stock strengthened up. Cowan raised estimates and WRH is a big fan now as well.
CSV, DJ news reported a whole bunch of insider buys on Feb. 13th. We are not sure if they are open buys or not and look as though they are not. There were a total of 120k shrs bot by 6 different insiders and they were all bought at $6.40/shr. So one thing we can definitely rule out is that there's won't be much or any of the insider sales anytime soon. This is just the common sense that if all those insiders were willing to put in their own money into a stock that just made a new 52 week high after an earning report, there's no reason we shouldn't either. A business is a business and as long as the business is legitimate, we are not going to give anymore thought to that.
MFW, this is one stock which we are officially giving a "kick a$$" title today. There will be sometime before they report so as long as the market is in a neutral to bullish mode, we trade it on the long side. We've had this core hold and USAP up every night this week as the reversal started.
USAP, a new 52 week high today and only as little as two days ago, this one is fighting off 9 ema. Strong stock, nothing more to it.
VTRU, we aren't disputing anyone's claim of how much more this thing is worth so we are sticking to "seeing is believing" attitude. First in the $43's off earning here, we said we'd back. Today the chart cried for a good look.
A few others we reminded to keep watch on today, SSRX from last week, CXW, AVZA made NCH but we'd like to see some more volume to sustain this. Also, if a stock like EML is to bounce from 9ema levels it doesn't mean it has to touch it...it's just too thin to play that game. CCOI might be worth a further look as it comes to highs.
We have 3 days off coming up and there will be some profit taking into it, but if that's your worry...you should have been selling into strength these last few days. After a week like this, dip buyers will be waiting for your shares tomorrow.