THURS. JUN. 26 THOUGHTS

“It is a tale told by an idiot, full of sound and fury, signifying nothing.” For all you literary fans out there, that is a quote from Shakespeare’s “MacBeth.” For all you day traders out there, it was the refrain for the net performance of the Dow Jones Industrial Average yesterday. However, particularly in the advent of some wild intra-day action, it is worth noting that there was a very firm tone to the market yesterday (which will reverse totally today). This is brought up to show the effect that raw numbers can have on the uninformed. Boeing (BA) was down over 5 points yesterday. As a member of the Dow, it brought that benchmark average down by over 50 points. All afternoon, it was so very whippy, but mainly on the long side because there were actually five stocks up for every two down thus many (certainly not all, but many) day traders lost money shorting stocks in the afternoon in not being aware of what was really going on with the same ratio of up to down volume on the NYSE (again, on an intra-day basis) simply because of the distortion of a very outdated number. So, please be aware of the underlying tone of the overall market as well as the easy way that numbers can take on different meanings so that your trading doesn’t turn into a Shakespearean tragedy as well.

Overnight, markets in Asia were quiet, Europe started higher, but things in the States are not good. Oil prices are back up on a renewed weakening of the dollar, but the important thing here is the continued destruction of financial stocks as well as RIMM posting terrible earnings. The most astounding fact of all is that Goldman Sachs (GS) issued a “sell” rating on Citicorp , but also issued a ‘short sell’ rating; it is hard to recall a time that has happened. So, the market is in line to get crushed this morning to new year lows.

VNDA- positive phase III data. Stock traded up to 6 and back down to 5. If the stock gets negative, it is a short.

OSK- warned badly. Likely A-B-A2 to downside.

CEDC- did share offering. If it gets through unch, it is likely a buy.

SQNM- did major share offering 15.50. it is a short below 15.50 or a buy thru unch.

RIMM- abominable earnings. Best to stay away.

NKE- terrible earnings forecast. Likely A-B-A2 to downside.

LEN- bad earnings and announced they applied to do a convertible offering. It is a buy thru unch if it gets there.

FTI/RSG- on Cramer’s show last night

BUD- rejected bid from AmBev. If stocks stays negative in pre-open, it is unequivocally a buy thru unchanged…want the thing to stay negative pre-open though but it is tradable even pre-open if it does the move then.

ITWO- preannounced to upside. Likely A-B-A2 one way or another.

C- likely very difficult day trading vehicle today…probably better to short than not, but very very hard. Best thing to do is likely to steer clear.

Good luck today.