THURSDAY MAY 22 THOUGHTS

There's an old Wall Street riddle which stock market junkies (a.k.a. nerds) love that goes a little something like this:

Q. When is it a good time to sell an airline stock?

A. Anytime the stock market is open for trading



Ne'er have truer words been spoken than yesterday. The worst performing four stocks on the NYSE were all major airlines (i.e. Delta, American Airlines, and the like). Where am I going with this? into a world of worry. Is it really possible that we will soon be paying $10/gallon at the pump? Is it possible that the airline industry as we know it be run ostensibly like Amtrak by the Federal government? Or is this whole thing going to remediate itself following the Olympics in China this summer at which time economic growth in China will dip? yeah well, if I knew, I wouldn't be pontificating about all of this but rather have major positions in the oil sector- one way or another.



Where am I going with this trading-wise? All of this minutia will have a direct impact on the way I want to trade intra-day today (except for the stocks of several outlying companies which reported earnings) as almost everything I have highlighted is in some way connected to this theme- let's put aside the macro and instead get lost in the trees in the forest:

The oil market is up yet another dollar this morning yet the European equity makets reversed early losses and are all trading positive. That would seem to lend credence for a snapback rlaly today in the U.S. as well.

STP- Announced awesome earnings. Stock traded around 51 pre-open. It has since traded down to 48.50. Thus, if solars sell off, I look to short STP through 48.50 for a quick spot trade.

ESLR- announced $1 billion in new contracts. To trade this, watch the solar trend and this is how ESLR will trend as well.

GBR- Currently called CabelTel. They are getting out of the real estate business and changing their focus to natural gas exploration. No, really. Oh, and they were a medical compnay in 1991 when medical was hot. And changed its name in 1996 to better reflect medical supply diversity. And changed its name and focus to real estate in 2005. And now changing focus anew. Really. Will be a trade here on a short squeeze.

CRM- They beat but warned that growth was slowing. Thestock has been beaten down the last few days. It traded all over the place after-hours, but settled in-line. If the market rallies today, this is a buy through unch and probably a bias long trade all day. And if market opens higher, it was ugpraded by several places...will short thru unch.

NTAP- warned of slowing growth. If the market is weak, this one will be even weaker than it is at the open in all likelihood.

NRG/CPN- NRG acquiring CPN for 23/share i nstock based on NRG clsoing price yesterday. But NRG down now and CPN at 23. CPN may be buy above 23 in anticipation of a raised bid.

NTES- beat marginally on earnings. Stock was down. I think this thing bounces in any market bounce and will play it as such.

SOLF- After having a huge run-up and bang-up earnings, the stock only settled up 1 1/4 yesterdayafter trading as high as up 6 1/4. f it opens down and the solars turn back positive, I look to trade from the long side and especially buy it thru unchanged post-open partiuclarly as it was downgraded on valuation at Goldman Sachs.



PDO- this stock has a gigantic run from 8 3/4 last Thursday to 27.10 yesterday. If it gaps higher and oil turns down, I look to short this through unchanged if not before.


MXC/FPP- the amazing run continues in this one also. Same theme/idea as PDO.


UAUA/CAL/DAL- all airlines closed near their lows. If they open higher and oil opens higher, I look to short through unchanged and then again through new lows. For isntance, if UAUA opens at 8.25, I'd short 8.15ish (ucnhanged) and then again later at 8ish if it gets there as that was today's intra-day low.


CRED- could be the next MXC/PDO. If oil stocks are strong, look to buy this through Wednesday's high (around 17).

Other stocks to watch- ENS- Cramer. ANN,BKS,DKS,FLO,GME,GSOL,HRL,PDCO,PLCE,TECD,TTC,BCSI reported today. After-hours earnings include: AKNS, ARO, ARUN, BBOX, CA, GPS, PSUN, VRGY, ZUMZ.

Good luck today.