Day Trading Thoughts For Wed. Apr. 29

[erikrkolodny]

In reading a passage from Dennis Gartman (author of “The Gartman Letter”), I was left somewhat speechless (for once in my life). Gartman noted that the CEO of Bank of America (BAC) accused Fed Chairman Bernanke of being directly involved in the withholding of information from BAC shareholders as well as the American tax paying citizenry regarding BAC’s merger with Merrill Lynch. He further noted that if there is the slightest iota of truth to CEO Lewis’s claims, Chairman Bernanke would immediately become not only a political but an economic liability as he’d lose all credibility. Thus, if this storm cloud turns into a full-fledged hurricane, it could have dire consequences for the U.S. In the immediate-term, the problem would be exactly what it is we are seeing- a decline of the U.S. dollar relative to other currencies over the last few days. Some people are blaming the fall on things like the swine flu, but that makes no sense as that is a worldwide issue. Thus, it is entirely plausible that there is more to this than meets the eye. Forget whether one believes the job that Bernanke is doing is good or bad; the issue is one of credibility…would anyone be able to trust any Chairman of the Federal Reserve ever again? Furthermore, should Bernanke leave, it is prudent to assume that a new chairman would be put into office with beliefs more associated with President Obama than Chairman Bernanke. Keeping politics out of this, a development such as that would likely be another catalyst for a dollar decline because everything suggested by Obama involves massive use of the paper dollar so more dollars would make each dollar worth a little less. For equities, it is the last thing anyone needs. The markets have recovered nicely, but it is fragile. Thus the daily epiphany: this is one more burgeoning crisis to watch (or one that may well dissipate if Lewis gets a vote of confidence by the BAC board imminently). As we approach the warmth of May and exit stress tests and earnings season into the middle of next month, the markets will seek something else to follow thus political rumors may start to begin to circulate that much more about the futures of people like CEO Lewis and Chairman Bernanke.

Markets throughout the world rallied overnight as fears dissipated re the swine flu and hope sprung eternal again in the banking sector as stocks in Hong Kong and Europe rallied 1% to 2% across the board. The GDP came out terrible this morning (down 6.1%, much worse than expected) yet the futures shook it off; this is a very bullish sign. With banks up notably state-side, look for an upside bias as the markets have had every opportunity to sell off earlier this week and did not. It will likely be quiet again except among the myriad of companies reporting, but a definite bias to the upside all else equal. I’ll also note that if I prove to be wrong today, I’ll likely be very very wrong since all the signs seem to be so good this morning so as always, have a thought about what should be, but trade what you see.



Reiterating-
Please understand that if the ideas do not get to the hoped for set-ups cited below, more often than not, one should not blindly trade the symbol next to said idea.
If the whole story is not there -
If something is good, assume either a short thru unchanged or an A-B-A2 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specifiedIf something is bad, assume either a buy thru unchanged or an A-B-A2 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specified-



Good- The following stocks have good news and/or a strong technical pattern

DNDN- very positive drug results

BMY, FO, YUM- on “Mad Money” last night

WFC, BAC, PNC- late upgrade on bank stocks discussed yesterday evening on “Fast Money”

LIFE- good earnings

DWA- good earnings

PSYS- good earnings

CBI- good earnings

MPWR- good earnings

VRTX- closed near a high

EFUT- closed near a high

WBSN- decent earnings

COG- good earnings

RRC- good earnings

FCN- good earnings

GS- good earnings

HES- good earnings

JNY- great earnings

SLAB- good earnings

SVVS- good earnings

TWX- good earnings

WXS- good earnings

WYN- good earnings

ABX- good earnings

MHS- good earnings

NYB- good earnings

Q- good earnings


Bad-The following stocks have bad news and/or a weak technical pattern

ETFC- horrible revenue guidance

SSW- closed on its low after poor earnings guidance

VFC- bad earnings

TXT- bad earnings and doing a share offering

BWLD- bad earnings

PNRA- bad earnings

TRMB- poor earnings

TSS- bad earnings

JEC- closed on a low

MAS- closed near a low

FDP- closed near a low

AET- terrible earnings

ROC- bad earnings

ROK- bad earnings

MT- bad earnings

WMI- bad earnings

SAP- bad earnings

X- share offering at 25.50





Earnings:

WED APR 29 BEFORE

ABX AEP AET

AFL AMG AMT

ARW ASCA AVA

BDC BHI CETV

CNP ENDP EOC

EWBC FCN GD

GT HES HST

IACI JNY MCO

MDP MHS MPS

MT MWV NJR

NVE NYB PX

Q RAI RCI

RGS ROC ROK

ROL SEE SLAB

SO SPW STR

SVVS TEL TXT

TWC TWX WMI

WXS WYE WYN



WED APR 29 AFTER

AEM AIZ AKAM

AMKR ANH ARRS

AVB BEZ BMR

BXP CAI CAVM

CBG CBL CBT

CCI CDNS CLF

CNQR CTXS CVD

DNB DPL DRC

DRIV DST DTE

EFII ESRX ESS

FLEX FLS FORM

FSLR FTI GMR

GNK HAR HIW

ITRI ITC JDSU

KEX LPS MANT

MOH NTRI O

OI OII OKE

ORLY OSIP PLD

PLXS RE RNR

RYL SAP SBUX

SKX SPN STM

TCO TER TRN

TTEK UNM URI

V VAR VARI

WGL WLL WLT

WSH





Good luck today.



Erik R. Kolodny

 

[nazzdack]

Quote from erikrkolodny:
I was left somewhat speechless.

What would it take to give you writer's block?

 

[erikrkolodny]

Arthritis. Let's hope neither of us gets it; without it, I cannot put my thoughts down and clarify my battle plan for the trading day while hopefully helping others as well.

Wishing you luck nazzdack; hopefully, you can use your spare time attacking me to do something more productive in time.

Quote from nazzdack:

What would it take to give you writer's block?