Pre-Market Thoughts September 12, 2013:
Happy Thursday to you! Futures are basically flat this morning and we are all waiting eagerly to see where the money flows once the opening bell rings. Can the Dow-30 hold on to yesterdays gains?
As I said yesterday evening, I think there is a possibility institutional money managers will be selling into POMO over the next two days. Just look at the run up we’ve had. And the US dollar also looks set to bounce which might present a headwind for equities (although that correlation has been dicey as of late).
US Jobless claims are the lowest since 2007. Of course, nobody is really sure what this means. And in this “good news is bad news” world of market logic, the only thing that really matters is how the indices react to this news. Accordingly, I will watch the open closely but refrain from any action for the first 30-45 minutes.
My Portfolio On September 12, 2013:
I’ll be mainly watching for follow through today. I’ll be asking if BRKS can continue to consolidate higher, or if I’ll get a chance to dip buy it. And if SNV can hold on to yesterday’s late afternoon gains I will be the very picture of content. AEG has also shown strong performance lately and I will keep a close eye on it. The action in BP is also encouraging to me.
What stocks are you watching today?
Depending how things go, the moment might be right for an IAG trade, too. Perhaps the selling seen in the last two days could continue but since I don’t yet have a position a “pilot buy” might be in order – drawdowns be damned. Gold is getting slammed pre-market so I will watch the open and be sure to let you know if I dip in a toe should things stabilize.
But that’s not it. There’s lots more to share with you this morning…
Market Articles Worth Reading Today:
— Free FinViz Stock Screen for Fundamental Value (Video) – how do you find safe stocks to invest in?
— Pit Bull: Lessons from Wall Street’s Champion Day Trader
— Putin pleas for caution (presumably you’ve seen this by now, but just in case).
— Michael Dell Wins! Dell is going private for $25 Billion.
Update: Barry Ritzholt has a great piece called “Is the Market Rallying on Syria or Summers?” I particularly like the introduction where he dismantles the idea that each minute-to-minute move in the market can be described by macro-economic events or news headlines. Smart.
Free Video: How To Find Cheap Momentum Stocks with FinViz.com:
Thanks for watching!
Stock Market Day in Review: September 12 2013
Sorry for the late update. I was running some errands this evening and am only now getting back to today’s market action.
For me, it was a mixed bag. After my early declarations of relative strength, BRKS faded into the close. On the other hand SNV held up like a beauty.
All in all not a bad day. And that’s kind of what we were expecting. Whenever I hear traders talk about POMO on a given day, like today and tomorrow, their seems to be an assumption the market will go up. But wouldn’t it make more sense to run up price in advance, if you know someone else is footing the bill?
From here I think it’s important to judge the nature of the pause in equities rallying. Maybe there will be more trepidation tomorrow. But as long as things don’t deteriorate too much I think you have to respect the ongoing uptrend (it’s what markets do after all, right?)
I don’t have 100% exposure (about 20% cash) but I’m feeling okay being long in stocks with conservative valuations (relative to earnings and assets).
How are you playing this?