Tuesday, January 08, 2008

See Ya - Wouldn't Want to Be Ya

We have reasonably healthy action so far today, but not out of the woods behavior just yet. My sawed-off machete is velcro'd to my hip, ready to lance anything out of my position which trades below yesterday lows - no exceptions now*.

I trimmed TNH back at 146.50 early; great entry yesterday, but it's really not the type issue I want as my largest position - I took some off on the first surge higher; still like it >136 or so.

I added OII long (ave. 75.24) and am looking to add one more in the Energy/Exploration group; or possibly a smaller Oil Service name.

[Edit: I bot CVI (ave. 25.28). This is a newer, small, aggressive growth issue in the petroleum refinery/transportation fuel business, but with their back-pocket in the nitrate fertilizer biz - woot!]

I was whipsawed in losing my JASO position at 67.73 yesterday on a stop, but at that moment it was the very kind of stock which was catching up quickly on the downside and the market was on its final purge before recovering only in the final thrust minutes immediately after. I bot JASO back today (70.64) and it appears live once more (amateur 3-1 split announcement and all). Stepping back, you really have to credit this name for never really breaking down, especially considering that profit-taking was fierce in that group yesterday, with a couple solars down >15%. I am still on sidelines with YGE, but YGE and CSIQ seem the best of the rest at moment (my opinion).

My SBUX trade make up for the frustration from getting jerked around on JASO and the remaining portfolio is behaving decently (the health/bio/etc. portion of my greed was exceptionally resilient in this bath-water downside). Regarding SBUX and news there that big daddy Schultz is coming back, I'll repeat something smart that Jeff Macke (best of the current trading voices on Fast Money) said last night - never fight a billionaire when he is angry.

SBUX should not be short any time soon. I'm out of SBUX (long) last night, but my late trade there yesterday netted almost 10% in a matter of an hour or so - I'll take that on a big and broken issue any day and poke a sharp stick in my eye just to keep humble.

Just in, I've killed off the FWLT positon (146.96), which just blew through the yesterday low. Someone else is going to have to make the money here - I have no patience for any downtrending just now.

Still a need to be on guard, in case this stabilizing action in the market re-invents itself to the downside. A re-surge lower now would break open the psychology enough to cause significant damage in the strong names which have thus far held-up. Should the market blow through to lower-lows now, you'll see a rotation of the executioner and stocks which held up well earlier will see the worst bloodletting next; a catch-down reaction.

A nice and slow start to the upside, with a bit of backing and filling, is the healthiest action for this market turn. Let it pick up a little later when the Bernanke Corporation guide things up on their next conference call (due perhaps Thursday when Ben speaks in public - or possibly sooner, since other members of Fed are in the public today).

Fresh woes from CFC is knocking the financials to lower lows - that may be another friendly development as far as it relates to upcoming Fed actions. We'll see the Fed's newer, smarter attack on things soon enough.

I'm hoping to update my Live-list from Sunday night sometime today; adding some new names and subtracting those weakened.

*I'm giving ONXX and AIR an exception (so weak). ONXX never really gave up much on the market decline and the 50-day is a reasonable benchmark, a little lower from here, on a closing bass (50-day currently 54.65). AIR should have been sold yesterday and now I'm giving it the 50-day on a post-2pm est-basis (32.91 current). If volume increases enough (not heavy now) and it is below the 50-day I will let it go sooner; otherwise I'll give it until 2pm.

Current Position (by size): ONXX, GENZ, TNH, HOLX, OII, LNN, JASO, SYT, AIR, CAF

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