Friday, October 06, 2006
Johnny Cash: Ring Of Fire
Click here for clear audio version.
However, it's worth citing the beginning of the 3rd quarter earnings season next week. For me, a major tell will be the LRCX numbers, scheduled on Wednesday.
My knee-jerk reaction is to sell into the numbers. However, maybe, just maybe, oil has dropped enought to enable the consumer to buy one more iPod or Lam Research semiconductor chip.
That doesn't make much sense, does it?
Or, what if the numbers were guided down enough last quarter, so they can easily be beaten now?
It's always a gamble, buying stocks during earnings season, literally.
As for today's market:
If you're a bull, it's exactly the type of pullback you want. Small and non-eventful.
Unless of course, you were misfourtunate enough to own stocks like MU or VSTH. Cocksuckers.
Apparently, the "stocks under $10 guys" stirred the pot yesterday on VSTH, due to fear that VSTH may have lost a contract with Myspace.com. They say the company (VSTH) did not return their calls.
I swear to God, if the Myspace deal ends up being renewed and this massive fucking selloff was all because a few assholes on Cramer's shit-shoveling-site (stocks under $10) decided to flag one of their top recommendations, then I will send 200 pizza's to their office. However, that might be a bad prank, since Cramer may be able to put down 50 pies himself.
As for the rest of my holdings: Pretty good. I was up 0.6% this week.
Today, gains were found in Internet, Chemical and Oil stocks. While, losses were abundant in Trannies, Semiconductors and Retail.
Late Day Thought
Fly Buy: FDRY
Position Updates: VSTH, ATHR
VSTH is getting its fucking head sawed off because it's rumored they may lose the Myspace.com deal they enjoy (33% of revenues). Plus, if GOOG buys YouTube, that merger may throw a wet towel on VSTH's chances of inking an ad deal with YouTube.
ATHR is going up on rumors of an LBO offer. Please, give me a fucking break.
Bottom line: I am staying the hell away from VSTH, fuckers.
But, I may bulk up on my ATHR short.
Hey, Where the Dip Buyers Go?
A. Semiconductors are a fucking deathtrap (MU).
B. The economy is slowing down too fast.
C. The dip-buyers don't care. They just go long stock, all the time.
Now, I must admit, barring a miraculous comeback today, it appears the sellers have the momentum and normally I would go short stock, prior to the weekend. However, if I am to obey the recent trends, today is a buying opportunity. That's right, buy on the dips-- its been good for your portfolio.
Frankly, its not that bad out there today. Despite end of the world type numbers out of MU and a pathetic jobs report, the market is not down nearly as much as I expected.
Bottom line: Until the trend reverses, today's decline is a buying opportunity.
Wednesday, October 04, 2006
Frank Sinatra: Fly Me to the Moon
Yesterday, I had a hunch to cover my RACK short and lever myself to the upside. I don't know why, it just felt like the right thing to do-- considering CNBC got their new fucking high.
If you were long today, it was exquisite. I was up over 2.3%( ytd return now 26.7%), as everything in sight was bought up by the dip buyers.
The only short positions I hold are ATHR and MZZ. However, they are very minor and had little effect on performance today.
I know many bears are scratching their heads now, wondering: "What the fuck just happened?"
Well, in short, you got your ass kicked by a bunch of raving lunatic bulls, who are unable to differentiate a PE from a pea. They are just here for the ride and are all about having fun, while deploying billions of dollars into securities that are likely to be 10-15% cheaper, within 6 months.
The long term (6-12 months) bear case is definitely intact. However, for now, the market has extreme momentum to the upside. Therefore, it makes sense to ride the wave.
NOTE: Due to client meetings, I will be away Thursday and Friday. However, I probably will post Friday evening.
Late Day Thought
Quick Alert: Bull Market
I understand the idiot investor and know what he wants. And, right now, he wants to launch the DOW over 12,000.
If you haven't participated in this rally, its not too late. Take a look at the Networkers, specifically EQIX, FDRY, SVVS,MRVC, GLBC and small cap gamble AVCI.
I feel uncomfortable chasing the semi's, since I believe their fundamentals are weakening. But, the networkers, well, they're on fucking fire.
Fly Buy: DNA
Fly Buy: FDRY
Fly Buy: ADBE
Sector Spotlight: Financials
Now, that doesn't mean investors cannot make money shorting stocks. We are in earnings season and there will be chockfull of opportunity.
I am thinking good and hard about shorting LRCX, BRCM and more ATHR. At the same time, I am scouring the market for good longs, such as: FDRY, EQIX and maybe a little more VLO.
Bottom line: Despite my dire warnings about the markets top heaviness, for now, it looks like it will drift higher. However, as always, I am looking to protect my downside with some shorts.
As for the Financials:
Besides housing related banks, like CORS, they have been super. Frankly, I don't understand why investors are piling into expensive banks/brokerages, like GS, MS, BSC and LEH, while the yield curve is inverted. Typically, an inverted yield curve is the death nail for bank stocks. Perhaps this time is different?
The following Financial stocks have mojo:
Tuesday, October 03, 2006
Young Jeezy: Trap Star
FDRY has Limelight (AKAM's main competitor) as a client and just signed a deal with BIDU today. I like the action in the stock and feel it could go to $15.
On the short side, I still hold positions in ATHR and MZZ. The reason why I covered RACK is due to market sentiment.
Meaning: If bad economic data, fucked up MRVL guidance, and dozens of option backdating scandals can't rattle the markets, I don't know what can.
I am tired of pushing the boulder uphill-- its much easier to roll that bitch down.
So, for now, until I see a break, I will add long positions and lever myself to the dumb money sloshing around. However, I will keep a very short leash on new trading longs.
As for today's markets, it was incredibly strong-- as CNBC got their new high and the bulls cut up a few bears in the process. However, there was considerable weakness in Semi's, as MRVL dragged everything down with it.
Prescious Metals and Energy stocks got poleaxed today and look ridiculously bad. Therefore, they are probably good trading buys here.
Finally, the Retailers were on fire today, as the consumer is deep pocketed-- due to collapsing energy prices.
Botton line: The markets have momentum to the upside. Fucking Goldilocks.
NOTE: It appears VLO warned after the close. The stock will likely trade up tomorrow, since everyone knew it was coming.
The follwing stocks had notable upside moves:
ICE, IFC, SPTN, PFCB, AXR, IMKTA, IRS, IRBT, AH, REV, PWX, QLTY, JBHT, SWFT, WERN, CHNR, XNL, USEY, PDRT, DVSA, HSR, PRB, BBC, MDV, LCBM, STGN, EMIS, IFLO, BDMS, VSTA, STJ, SIGA, GNBT, CARN, HEB, APTM, SRVY, BVSN, PACT, NENG, CMGI, CTRP, GOAM, INSP, MAMA, QPSA, WSPI, WBMD, DTAS, CTDC, LPTH, ZNH, ATCO, APAT, LNOP, FTGX, PCTI, GIGM, GGBM, TUTS, MIKR, OCCF, AV, CRI, SPLS, HOTT, CROX, MWRK, RVI, EVST, ARO, BID, TWTR, TVIA, HILL, LIOX, OPSW, CPCI, CRM, CTCH, EPIC, SWKS, SMTL, RFMD, CLEC, PTNR, DECC, PGWC, CLUB, CBRX, ACOR, NMGC, SYNX, SIGA, TCHC, CLRK, NTOL, BRR, TWW, XPO, AAU, RWC, WCC, SPC, FLE, VDM, NWY, PBY, CAB, CDL, HVT and FFH.
The follwing stocks had notable downside moves:
FACT, FRGB, PBG, NWD, COSI, TSTY, WLT, DHI, EME, EXP, JOE, OSG, CLB, TBSI, PLLL, IVAN, GGR, NGAS, LNG, CFK, BQI, IOC, SHI, HOC, SU, ECA, PCZ, VLO, ABLE, NXY, WRES, GSF, MRO, SUN, DWSN, MCF, CCJ, OXY, TSO, ANR, PGS, JDO, AEZ, QTWW, DRQ, NOV, TMY, BRNC, DO, CAM, RIG, SM, CRED, GDP, HAL, END, SWN, BEXP, CPST, BTJ, PDC, HES, CNQ, BJS, FDG, PTEN, TGC, DK, BMD, HOKU, ACI, GGY, RRC, FUEL, SUF, ERS, FCX, CUP, NTO, PD, TIE, BVN, BOOM, RTP, X, PCU, AL, ZEUS, NUE, GILD, AVNR, BIOV, BIVN, MATK, VPHM, FOXH, CLZR, BSML, DGX, BCRX, XOM, MIVA, ICCA, IPAS, KNOT, LQDT, BIDU, CNVR, VGZ, HL, SA, SLW, NXG, GROW, ABX, GG, KGC, AUY, PAAS, NEM, AU, MRVL, GEX, LTRX, IKAN, NETL, TXCC, ANTP, NT, AMCC, LVLT, EZPW, COLM, WEDX, ZRAN, OLED, PANL, CRYP, SMSI, CTXS, TIBX, EMKR, CNXT, IBIS, STTS, SMTC, BRCM, ATHR, UCTT, BITS, IOTN, IMX, NGPS, SIRF, ANAD, AATI, LSI, MDLK, CYCL, CWCO, EPG, STR, EICU, SFLY, REST, CPX, BAS, MWA, MR, DXPE, PEIX, MXWL, HDTV, MODT, LMRA, DCTH, NCST, LCRY, IPSU, SSRI, PLM, ALY, TRT, CLG, GBN, NAK, GRS, ITP, GDI and MDG.
Fly Buy: ORCL
Fly Buy: FDRY
Fly Buy: RACK
UPDATE: I covered some of my RACK short, buying 10,0000 @26.21.
Position Updates: VLO
However, with my money, I intend on incrementally buying more as it dips. I will probably add to the position if it hits $45-46.
NOTE: "I intend on incrementally buying more as it dips"
I can't believe I fucking wrote that. That would make me a "dip-buyer" wouldn't it?
Quick Alert: I am Holding Off, For Now
Sector Spotlight: Semiconductors
They pile into fucking airliners, as if 9/11 never happened. They buy retail stocks, as if the consumer is rich with savings. They buy auto stocks, as if GM and F actually make good cars.
Have investors forgotten the painful times, already? Do they really believe the shit they read and see or are they just sentimental fools?
As for the semi's:
Next week LRCX sets the tone, being the first major semiconductor company to report 3rd quarter earnings. Today, the SOX is not rolling over, despite a mega warning from MRVL. Therefore, I am going to dig in my heels and find another semi to sell short. I feel the SOX should be down at least 2% today.
Currently, I am short ATHR, RACK and long MZZ.
The following Semiconductor stocks have absolutely no mojo:
Monday, October 02, 2006
New Order: Regret
To believe that the consumer is on fucking fire and MRVL will blow-the-fucking-doors off the consensus because oil is lower is beyond stupid. It's dangerous.
Market pundits like Cramer pounding the table for high multiple tech, after 20-30% moves is cause for alarm. The prudent thing to do after such big moves is reduce risk.
Look, I know many of you think I am just some guy poking in the wind-- trying to guess a top or making poorly researched market calls. Not true.
My research is thorough and my market timing (normally) is excellent.
Bottom line: Look out for a red October.
NOTE: What do you know, right after I completed this article, the fuckers at MRVL issue an earnings warning. I am sure Cramer will say the stock price reflects a potential warning. To that I say: Fuck you; sir, you are wrong.
The following stocks had notable upside moves:
FBVG, PDA, VPS, AXR, GVA, RMX, TEX, HET, BYD, MCEL, GPRE, ARTW, CPST, EEE, HEP, STP, ERS, UNRG, ENY, BMRN, MDV, STGN, HGSI, MYOG, IFLO, ARNA, CNU, HEPH, TGLO, INSP, BCSI, QPSA, WAVX, HPQ, SNR, AMCC, BRCD, CCBL, INPH, PSUN, TAGS, JLN, PIR, VLCM, ZUMZ, ESST, DGIT, CSPI, KNXA, VTSS, OVTI, BITS, BESI, VIMC, DTLK, SANZ, TNE, IMFN, USMO, MDLK, RCCC, SLNK, WEN, FSN, INCX, CREL, TRGT, FXCB, ZONS, PHMD, NEOL, APPA, PTN, GMO, RGN, SVL, OMG, TNL and GFI.
The following stocks had notable downside moves:
BFF, CORS, BBX, TWPG, FRGB, LEND, SPTN, FIZ, SAM, WBD, COSI, MSSR, TSTY, CHCI, BLDR, CALC, TARR, CLB, HC, TRN, USAK, CHRW, EXM, SGMS, BQI, XNL, SYNM, LNG, GGR, GSF, PLLL, DWSN, NTG, HOS, CFK, MMR, NXY, IOC, PKD, SII, CPE, BEXP, FSYS, JDO, TEC, BRNC, PTEN, DO, DVSA, ICOC, ATLS, NHY, EAC, TMY, HP, ATW, NOV, FUEL, PRB, HOKU, ENER, BBG, ALJ, TONS, RTI, GILD, SUF, MEK, MIND, BIOV, NTMD, ALKS, EMIS, ARIA, AMLN, ONXX, KOOL, COLY, TRCA, CUTR, ACAD, BDMS, HYTM, RGEN, PRZ, BCRX, GNBT, WMT, MIVA, FLWS, SRVY, BVSN, WEBX, ENTU, AMZN, JUPM, LQDT, DIVX, MIKR, AVCI, RVBD, INTV, TERN, CNVR, VGZ, GIGM, ATCO, DVW, AVNX, VOCL, BKHM, LVLT, TIII, NUAN, CROX, SFP, BKRS, TVIA, OLED, KEA, CRYP, SEAC, RNOW, EPIC, ERTS, NWRE, ADSK, ININ, CTXS, OPSW, LSCC, NVEC, EMKR, IBIS, SMTL, CMOS, CNXT, FORM, TRID, SPSN, OVEN, IMX, SIRF, AATI, SFUN, HILL, TPC, IFON, QCOM, NTLS, OPMR, LCAV, ITP, FLT, ATEC, WSTM, AZPN, HYTM, BEAV, BRR, THE, VAR and SRX.
Position Updates: RACK
I think not.
More importantly, it appears RACK is finally rolling over, as sellers quickly overwhelm asshole dip-buyers trying to hold it up.
Additionally, this morning, First Albany issued a warning to RACK shareholders:
|Rackable Systems: Risks still high, firm reits underperform- First Albany (27.37 ) :|
Quick Alert: Beware of the Faux Rally
Undoubtedly, there is a lot of "dumb money" sloshing around now, trying to placate the fuckers at CNBC with their "new high" marathon countdown.
NOTE: I wonder if the selling in QCOM is overdone. All of a sudden, QCOM is nearing a 52 week low-- not good for tech's.
Sector Spotlight: Biotech
As for my other biotech position, DNA: Well, there is a lot to be happy about, if you owned this stock over the years. Moreover, with today's FDA approval of Rituxan and good data out of Avastin, I feel strongly about DNA's prospects going forward.
Biotech stocks are very risky investments. With my money, I don't have the medical background to really dig in my heals on a story, attempting to find the next MRK or DNA. It's simply too risky.
Instead, I buy leadership companies, with good pipelines and excellent track records-- typically big cap.
As for today's markets, I feel the ISM numbers coming in below consensus hurts. However, it wasn't weak enough to ring alarms or anything. Therefore, I do not believe the market will nose dive today, just trade moderately lower.
Finally, ahead of earnings season, keep a close eye on analyst downgrades. I seriously doubt those fuckers will head into 3rd quarter earnings with "Strong Buys" attached to every high multiple tech stock. Look for cowardice within the convictionless analyst community.
NOTE: Today, AAPL caught a downgrade and RACK got kicked in the groin by First albany-- reiterating underperform.
NOTE II: Please take the new "Fly Survey," on the left hand side of the page. Are you net long or short stocks?
The following biotech stock have mojo: