Friday, November 28, 2008

FRI. NOV. 28 - Half- Day After Thanksgiving

On this Kid’s Day at the NYSE in which everyone is encouraged to bring their kids to work, let’s reflect not on what we’re thankful for, but rather why the market is open today. The market is typically open for half days on the day before Independence Day, the day after Thanksgiving, and Christmas Eve. There have been selected days in which the market has been closed full-days as well. Namely, the market closed for several months during World War I, a stretch of days on and off between 1928 and 1930 in which member firms were allowed to catch up on work from the heavy volume of that time, and on days in which there have been funerals of presidents. Most recently, the market was closed for four days during the horrible 2nd week of September in 2001 following the terrorist attacks on American soil. Although there is nothing in the official stock exchange guidelines, there is indeed an unwritten rule that the markets not be closed for more than three days in a row so as not to allow for an order build-up and/or exacerbate a move should there may be a major news event. Since we have to be here, it is important to note that many days after Thanksgiving have been major trading days for the markets. One of the more recent interesting post-Thanksgiving sessions occurred in November 2000 after the election results were announced on Thanksgiving night. Days after Thanksgiving are typically ripe with illiquidity, but also bring in many amateurs playing stock market thus exaggerating moves that much more. So, although it seems quiet out there, be aware that in this unusual year, this could be an unusual day with sharp movement all the way up until the 1PM ET close.

Markets in Asia and Europe rallied net-net the last couple of days, however Europe turned aggressively lower this morning. Combined with worries over terror and the massive recent run-up, the markets are due for some profit taking this morning. Look for a down open, an attempt for a rally, and then choppy action for the duration of the shortened trading day.

Reiterating-If the whole story is not there -
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 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specified-

Good- The following stocks have good news and/or a strong technical pattern

GFG- very strong; could be A-B-A2 thru 2.90

AGM- strong; looking for A-B-A2 thru 5ish

ATPG- closed near a high; looking for more momentum

RMBS- momentum continued; looking for more of same

IOC- strong close; looking for A-B-A2 thru 12.50

JRCC- momentum continues; looking for buy thru 11.90 on an A-B-A2

BAC, MER- BAC got formal approval to close their takeover of MER and aims to finish deal by end of year 2008

GHM- closed on its high; looking for more momentum

EOG, SWN- among the very strong energy stocks on Wednesday

JEC- gigantic up move in last few days; short squeeze likely continues otherwise A-B-A2 to downside

LUK- violently higher on Wednesday; looking for continued momentum today, particularly thru 19.50 if it opens below there

MIC- way up on Wednesday; looking for A-B-A2 thru 5

Bad-The following stocks have bad news and/or a weak technical pattern

PCK- may discontinue dividend as announced Wed. morning; looking for A-B-A2 thru 6

FRO- missed earnings horribly

CHK- needs to issue shares to raise capital; file offering late Wednesday afternoon…never a good sign to file an offering on the eve of a major holiday




Good luck today.


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