Just as the stress seems to have abated to a certain degree, we are faced with trading going into a weekend. If the markets takes comfort today in the international markets and uses it as a catalyst to gap at the open, we wonder if taking solace in the rebound action carries over to holding into a weekend. Somehow, we think the investor/trader would rather get back in the cautious tent, put away the bargain hunting for a day and just wait for the signals from trading overseas come Monday morning to proceed. Yes, it felt better today but we prefer to lose sight of this and just head into the weekend with a cautious stance before everyone else. Hey, if we're wrong today, it doesn't mean we won't be kicking and screaming in if the market shows strength tomorrow. This was part of the thinking today and not getting overzealous in finding stocks off the gap that we would want to hold into the weekend. The gaps are great on the heels of a foreign market if you bought the day(s) before, but to chase them is not so fruitful as the days have been met with late day sell offs. Today was different, well actually it was not as the sell off started at 2pm instead of after 3pm when the subprime mumbo hit the market. These market opens are great if you want to dish out for 1000k shares of a HMIN type and make a quick grand+, somehow we don't think many of us are using this leverage but many smartly are as they sell off to others that chase these opens. Today just proved how sensitive the market is to any headline as we regurgitated more of this subprime news that has been burdening the market. Simply, it puts into perspective that even though some might be thinking we have bottomed, they will still run at first sight of any negativity. Most are thinking what ma and pa would do and not what they want to do themselves. Everyone is thinking what their fellow trader will do and right now it seems one doesn't have much confidence in the other to hold into a potential change in tide. Yep, we're guilty!. We have been bunkered 8,9 days and we won't miss something beautiful by jumping the gun, especially heading into a weekend....The commodities are showing they are game and financial are participating which has been a good sign. Besides doing some of the fashionable day trading here and there, we continue to be selective in what we put up....
KBW , we mentioned as a follow up Tuesday night to the banks has moved from $34 to a touch of $37 today.
NVTL , had climbed 5% to a high until taken down with the market. We said because we expected fewer plays, we'd taking bigger positions than usual if we had something showing movement upward. To work this strategy which includes adding on a sign of a move to a starter, we also said we expected to sell sooner..meaning a change of tide and we would bail most of our position. We did this with ABM yesterday and today with NVTL. We are not giving up profits in this market and there is no such thing (not that we have such) and that is a stop loss. We sold a sizeable amount on the 2pm swoon but think this will play todays highs soon again. In some respects it easier to trade now as you are concentrating on fewer positions and can see a move begin to materialize and therefore add or subtract in a more timely manner.
Today, we picked up FSLR again. It closed in NCH territory and is one of the few stocks that has regained all that it lost this past week.