Nov 3, 2011- Dr Jekkyl and Mr Hyde’s Market Persona

Fear of Missing Meaningful Moves- FOMMM

I was hooked on the currency markets last night and today.  Frankly, it’s a day traders’ haven as EURUSD has been moving 100 pips up and down within a span of 3-4 hours.  It’s a lucrative support resistance to be playing with. Going long near 1.3650, and closing the positions at 1.3800 or anywhere between the meat of those trends.  I want to go sleep though, and just call it a day.  But money and low risk setups are not always this frequent, so I’ll just place my alarm clocks and place my trades.

Went Long EURUSD just now at 1.3710, stops at recent intraday low of 1.3650, target 1.3800

Also went long OPNT pivot point of 44.52, – Bullish looking flag, wide stop at 42, tight stop at 44, targeting a possible new high.

My Technical Homeworks

Here are the bullish long setups I’m liking in the US space.  All are just screened using technicals. Awhile ago, I was still waiting for Philippines to sell off , in order to provide a compelling risk reward basis for people like me looking for some extra yields in the market.  However, I guess with the way US markets are gyrating with every emotion over any banker or world leaders’ statements, I’ll have to keep my average positions small, and err on the side of conservatism.  If I can’t find compelling setups in the Philippines, might as well direct my eyes to scalping currency support levels like a hawk.

Stocks in this list were found via looking at Nasdaq 100 components and Stocktwits 50 Best momentum stocks, or mentioned in Stocktwits streams:

I’m just concentrating my eyes on these particular ones: (25 stocks)

PSMT,OPNT,HSTM,STMP,ELN,STAA,EVEP,GRMN,TEVA,CTSH,QCOM,AKAM,CMCSA,CHKP,ERTS,FAST,INFY,

CELG,NVLS,TEA,V,BKI,DECK,MRK,ULTA

As always, the principle of caveat emptor applies equally to literates and illiterates.

*****

History seems to show that fund managers can get even more emotional than retail investors, but we’ll see if there are some catchup buying.   I read in the Inquirer today that Citibank Philippines’ Minda Olonan and Economist Jun Trinidad’s top 5 stock picks are EDC,MPI,ALI,BDO and AGI.  We’ll see if there’s some bids on these companies from the price action next coming days.  Maybe they could be talking their positions, or adding more exposure.  Price action will show us the way.

There’a quite a lot of factors to be bullish about.

Be aware of the context:

1.) Traditional Seasonality – Its generally favorable from here through early January.  Long term indicators confirm that seasonality’s working.

2.) Emerging markets are picking up strength – Investors are wearing risk-on hats all over the world, despite very wide volatilities.

Doug Kass wrote quite a nice piece illustrating the current markets:

Fear of return of capital has been replaced with the fear of an inadequate return on capital as fear of the downside has been replaced with fear of missing the upside.

*****

Disclosure: In the Philippines, Only have tiny size of PGOLD 5% at 12.56 (once it broke above the 12.50), 95% still waiting for my cash to be deployed.  If I find no setups, oh well.  I guess I’ll just go heavily short the dollar through other means.

Most of my FX positions are closed intraday, so no use really trying to disclose these things. I’m just starting to learn US markets, and just have OPNT.

Don’t hate Dr. Jekkyl and Mr. Hyde’s market persona.  Embrace it.  Adapt to it, and just love it.

By definition, risk must be taken in order to profit in the markets. The key is to manage that risk appropriately, which also means managing your discomfort appropriately. – Doug Kass, How To Survive an Emotion Fueled Market.

– FT (As I end this post, 1.3772 is the EURUSD and OPNT at 45.32. ) 😀

P.S.

Btw, here’s an interesting data point about Burgers! Mcdonalds versus the Competition. Click the link to understand the data visualization better.

Advertisements

About Abc

Abcdefghijklmnopqrstuvwxyz
This entry was posted in A Little Common Cents Corner. Bookmark the permalink.

7 Responses to Nov 3, 2011- Dr Jekkyl and Mr Hyde’s Market Persona

  1. Ben says:

    This is very true for me.

    Doug Kass wrote quite a nice piece illustrating the current markets:

    Fear of return of capital has been replaced with the fear of an inadequate return on capital as fear of the downside has been replaced with fear of missing the upside.

    Thanks for the article FT. 🙂

    Like

    • yeah. we do what we can do. I’m sure you’re not the only one. Look at me — 95% in cash. not exposed at all to the rising market! Hopefully, we get some compelling risk reward setups in the next coming days.

      Like

  2. Frank Ngan says:

    if everyone very liquid any good news could spark a rally ? I am a avid readers for your very informative and analytical postings cheers ! have a pleasant weekend

    Like

    • Yep. Traditional Seasonality and Hedge Funds/ Mutual Funds’ low equity exposure could trigger only short term corrections, and we may possibly consolidate with higher lows (My guess is we consolidate 4100-4200) , though individual issues that didn’t rally will return back to life. For instance, SMC was very strong awhile ago. Any dip is bought, provided one is managing one’s size. – FT

      Like

  3. Frank Ngan says:

    thank you have a pleasant weekend

    Like

  4. Lou Pa says:

    May I know why you chose OPNT. I dont know anything about US markets particularly the NASDAQ. Thanks

    Like

    • I just chose it because I saw that it was in the Stocktwits 50 top best momentum stocks (i.e. earnings growth are beating analyst’s estimates for the past quarters, and sales growths are rising too). From a technical standpoint, the bullish flag setup is also something I personally like. I liked the risk reward for my initial first few trades in the US markets, so I bought it with tight stops at 44 and a wider stop at 42 depending on the timeframe of the trade/investment. I crowdsource my trading ideas from the Stocktwits 50 list. (www.stocktwits50.com). Hope this explains. I just time them. The stock selection on fundamentals —I just based it on growing earnings and growing sales by other people.

      Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s