MON. AUG. 18 THOUGHTS

A common mistake that even the best traders out there make is overtrading. When the market is volatile, the average day trader is overly cautious due to the excessive movement and does not trust his own instincts in succumbing to fear. When the market is generally calm as it was on Friday, many traders jump up their size on their trades in an effort to earn a day’s pay. As we are entering the last two weeks of August- traditionally one of the slowest spates of trading during the year- be overly weary in what you are doing. Oftentimes during this calendar period, stocks move in a tight range so don’t simply put on 10 times what you’d normally would. What usually happens is that the stock does not move, you get frustrated, take a small loss, and then rinse and repeat. Many of us fell into this trap on Friday and it is being pointed out so that we can all be self-conscious of this type of self-destructive activity through Labor Day.

Overnight, markets in Hong Kong and China continued to decline although the European bourses are higher. The strength in Europe has led to some gains for futures in the early going as well. Look for a very quiet day today with pockets of activity in the financial sector in particular, but not a session for grand opportunities.

Reiterating-New code for the next few days if the whole story is not there due to an expansive number of ideas-
If something is good, assume either a short thru unchanged or an A-B-A2 based on direction of the market unless specifiedIf something is bad, assume either a buy thru unchanged or an A-B-A2 based on direction of the market unless specified

Good-

ELN- rumored to selling off division; should be good in immediate-term as it raises cash. Stock should stay plus, but if it goes thru unch particularly after run-up of last week, short thru unch- it is likely the trade of day if set-up works

APP- closed strong on Friday on good earnings

DYAX –positive drug news

SDTH- good earnings

FMCN- great earnings; will likely be buy after being beaten down, particularly if it opens at 28 or less

OMRI- positive upgrade

LOW- bad earnings, but strong this morning; yearly outlook looks OK

JCP – strong Friday on earnings; 40 resistance level could prove to be buying point

Bad-

RZ- closed weak on Friday

MENT- crushed Friday after their takeover deal called off

IPHS- down sharply Friday and closed near its low

PWRD- bad earnings

PRGO- weak earnings

RIMM- PacCrest issued weak report


Earnings:

MON AUG 18 BEF

LOW .56/14.11B .33/11.69B 1.50/48.28B 1.60/50.89B

PRGO .41/476M .45/474M 1.60/1.80B 1.95/2.02B

PWRD .40/48M .43/53M 1.69/202M 2.27/278M

TSL .80/192M 1.01/226M 3.26/793M 4.35/1.24B

ZNH ?/? ?/? -.06/9.01B -.06/10.52B

MON AUG 18 AFT

NONE

Good luck today.

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