Netflix earnings reports are usually pretty exciting. It’s just like binge watching a season and the episodes leading up to the season finale are all nerve wracking. Then the season finale sends shock waves through your couch and you realize why so many people have been hooked on the show. Is Netflix one of the “Walking Dead”?
IBM Earnings out on January 21, 2014
Big Blue aka IBM reports their quarterly earnings report today. The 5 past weeks have ended in gains. IBM looks like it is poised to break the downward trend it has been on since the beginning of June of 2013 . A quick glance at the chart and the $195 price level may draw your attention as a possible resistance level. Perhaps $182.80 seems like a support level. In either case if either of those levels are reached there will be some opportunities to trade with some momentum.
Without further delay here are some earnings related thoughts to go with the above. Assuming IBM is at $190:
Market Comments – January 20, 2014
- The function of education is to teach one to think intensively and to think critically. Intelligence plus character – that is the goal of true education.
- The time is always right to do what is right.
-Rev. Dr. Martin Luther King, Jr.
Last week we started off with a decidedly bearish day where the market was relentless with it’s downward price action. What a difference 24 hours later. While a little less dramatic the trend on Tuesday was clearly bullish and most of Monday’s action was reversed. Then things quieted down a bit the rest of the week. Somewhat interesting, was the lack of fighting between buyers and sellers on Monday. Tuesday offered only mild resistance compared to Monday but no clear signs that the buyers were in jeopardy. It made it easy if you were positioned in the right direction. The follow through for the rest of the week showed little conviction in either direction. This can happen during the earnings season. Investors and traders are more interested in individual stocks or they are trying to get a picture of the condition of the economy as companies are providing information on sales and other trends. This can also be a sign of market indecision and lack of commitment of investment capital. This fickleness of the market leads to higher perceived volatility. In other words, if you stare at the chart every minute of each trading day you will think the volatility is off the charts. If you only observed prices twice a month you would think nothing much is happening.
Have Your Game Plan Ready
Don’t even think of buying or selling without having realistic expectations of what can go wrong and just as importantly, what can go right. Here is another intersection of game theory and trading. Without a proper exit strategy you can let the two of the worst game altering forces enter the equation; Greed and Fear. These two forces will alter your probabilities of success. Game theory counts on rational participants. You need to remain a rational participant. Once greed and fear enter the picture most hope of remaining rational goes out the window. Set your targets and respect them.
Q4 Earnings for JPM release on Jan 14, 2014
The first major bank stock JP Morgan Chase (JPM) reports their fourth quarter earnings tomorrow. This should be interesting because we are near some all time highs for the equity market (notwithstanding today’s sell off). So where do things go from here? There are a few trains of thought. Are valuations of individual names too high for the upcoming earnings reports? Are the earnings strong enough to sustain these prices or increase them? Will the earnings show some weakness compared to the general economy and everyone runs for the exit door?
Continue reading “Q4 Earnings for JPM release on Jan 14, 2014”
Market Comments – January 13, 2013
The new year has been off to a pretty quiet start in terms of market movements. Not surprising due to the slow trickle of market participants coming back from holiday schedules.
In terms of economic news the monthly U.S. job report made things unclear since it was a worse report than expected. This continues the “bad economic news = good news for asset prices” cycle we have been in since the U.S. Federal Reserve Board has been participating in the markets through quantitative easing. Lately with all the prior month revisions, weather, government effects the report results have seemed to become less relevant. The event is more important. Here the prevailing opinion is that the numbers themselves don’t move markets, it’s the pent up demand or reaction trading that moves it. In a nutshell, think of the economic release as an opportunity to buy or sell and since everyone thinks the same there will be increased buying or selling. The point is that the news itself doesn’t move the markets, it’s the market using the news as an opportunity to move. More on that in a later post.
So You Want to Trade Actively – Things to Consider
You may have many reasons for wanting to take control of your investments and be your own trader. Maybe you have had some success picking stocks, maybe you’ve had some catastrophes and want to turn it around, perhaps you would feel like you can supplement your current income, invest for retirement, or even trade as a career. There are many reasons why you should become actively involved in investment markets. There are also a number of reasons why you should stay away. It is important that you recognize that you need to have an idea about what is happening with your money and why. Even if you only have a 401k or other retirement account, you have money at risk. Do not let anyone tell you otherwise. It is important to understand the how and how much of this risk. It is almost never zero.
Consider this a brief overview. This will serve as a primer that should get you thinking about what you need to do and how to prioritize your efforts to be able to start actively managing your investments and begin trading on your own, or not. Continue reading “So You Want to Trade Actively – Things to Consider”