Trust Needs to be Earned...7/24/06
The market continues to dislocate on a daily basis making it difficult for traders to find themselves on the right side. Once the market gaps up in the morning it becomes very difficult to chase it to the upside knowing that a major down draft could happen in the late afternoon or certainly the following day. Conversely, big down openings are just as difficult to short as intra-day reversals late in the day can happen without warning. The market can use a little less volatility and a little more follow through. This would go a long way to restore confidence and have traders add back some points to their performance, which would further improve the mood. Unfortunately, most traders find themselves getting chopped up in the wild swings in this schizophrenic market.
All in all earnings have been significantly better than anyone expected. Ultimately, those earnings will be rewarded once confidence is restored. All it will take at this point in time is a little more sequential follow through with a calmer trading environment. The intermediate term oversold condition of the market will then be allowed to repair itself over several weeks which certainly is more preferable than the on-again, off-again action we have been experiencing recently.
When the market gapped up today many traders tried to fade the early strength. The resilience of the market caused many traders who sold to get back in later in the day.
The lack of trust that everyone has in this market is a serious issue. Therefore, expect today's buyers to flip out positions sometime tomorrow despite the solid earnings that we are seeing after the bell. An important test of the true resilience of the market will be how intra-day weakness is handled by the dip buyers. Should the dip buyers fail to show tomorrow, look out below!
IF YOU HELD A TASER TO OUR HEAD:
After the bell, TXN, ALTR & SNDK reported solid earnings and guidance. This should provide a little more fuel to the upside in the AM creating an even more enticing opportunity for flippers to put on the fade. Remember, it's the dip buyers and the close that we will be watching before we can declare that trust is finding it's way back into the market.
Have a good night. ___________________________________________________
The analysis, opinions and/or forecasts expressed on the Kcap Trading Blog (âKTBâ) are for informational purposes only and should not be relied upon in making investment decisions. By using this site you agree that Kleiner Capital Management, LLC (âKCAPâ) and its principals are not liable for any action you take or any decision you make in reliance on any content. Please be aware that there is no commitment by KCAP to update the KTB. Furthermore, there may be inconsistent timing and follow up (if any) of posts.
None of the information on KTB is considered individualized investment advice and should not be construed as a recommendation or solicitation to purchase any securities. Reliance on information provided on KTB in no way establishes an advisor-client relationship. Investors are encouraged to seek the advice of a qualified investment professional prior to investing funds.
Clients of KCAP, as well as the firmâs principals and other employees, may be invested in securities discussed at KTB. However, any mention of said securities is not intended to influence market conditions for the security to the benefit of KCAP clients and/or principals and employees. KCAP is not affiliated with any advertisers on this site and does not endorse any of their content. For additional information and disclosures, please visit www.kleinercapital.com.
The information on KTB has been furnished from sources we consider to be reliable, but no guarantee is made with respect to accuracy.
___________________________
All in all earnings have been significantly better than anyone expected. Ultimately, those earnings will be rewarded once confidence is restored. All it will take at this point in time is a little more sequential follow through with a calmer trading environment. The intermediate term oversold condition of the market will then be allowed to repair itself over several weeks which certainly is more preferable than the on-again, off-again action we have been experiencing recently.
When the market gapped up today many traders tried to fade the early strength. The resilience of the market caused many traders who sold to get back in later in the day.
The lack of trust that everyone has in this market is a serious issue. Therefore, expect today's buyers to flip out positions sometime tomorrow despite the solid earnings that we are seeing after the bell. An important test of the true resilience of the market will be how intra-day weakness is handled by the dip buyers. Should the dip buyers fail to show tomorrow, look out below!
IF YOU HELD A TASER TO OUR HEAD:
After the bell, TXN, ALTR & SNDK reported solid earnings and guidance. This should provide a little more fuel to the upside in the AM creating an even more enticing opportunity for flippers to put on the fade. Remember, it's the dip buyers and the close that we will be watching before we can declare that trust is finding it's way back into the market.
Have a good night. ___________________________________________________
The analysis, opinions and/or forecasts expressed on the Kcap Trading Blog (âKTBâ) are for informational purposes only and should not be relied upon in making investment decisions. By using this site you agree that Kleiner Capital Management, LLC (âKCAPâ) and its principals are not liable for any action you take or any decision you make in reliance on any content. Please be aware that there is no commitment by KCAP to update the KTB. Furthermore, there may be inconsistent timing and follow up (if any) of posts.
None of the information on KTB is considered individualized investment advice and should not be construed as a recommendation or solicitation to purchase any securities. Reliance on information provided on KTB in no way establishes an advisor-client relationship. Investors are encouraged to seek the advice of a qualified investment professional prior to investing funds.
Clients of KCAP, as well as the firmâs principals and other employees, may be invested in securities discussed at KTB. However, any mention of said securities is not intended to influence market conditions for the security to the benefit of KCAP clients and/or principals and employees. KCAP is not affiliated with any advertisers on this site and does not endorse any of their content. For additional information and disclosures, please visit www.kleinercapital.com.
The information on KTB has been furnished from sources we consider to be reliable, but no guarantee is made with respect to accuracy.
___________________________
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posted by Kleiner Capital Management, LLC. | 6:29 PM
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