iBankCoin
Joined Dec 4, 2012
298 Blog Posts

Why You Should Vote For Our Content

Anyone can weigh in about stocks or the market and be right 50% of the time. The only way to take that batting average up to 70% is to have a disciplined systematic process that tracks the technicals, economic, fundamentals and  market intelligence. So far you have seen just a small amount of our process used by top managers and high net investors around the world.

Our work is for the professional who is looking for the additional edge. We hope that you the reader want to up your game. We can never make a bad trader but we constantly make good traders really good traders.  We hope you vote for substance over fluff.

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Intraday Changers For Short Squeezes and Long Squeezes

Below are the biggest changers in our Short and Long Squeeze categories that were short or long squeezes as of last Friday’s close. Our definition of a short squeeze is a name that is doing well technically over the past 100 trading days and a short ratio greater than 4.0 with a short intensity greater than 60%. A long squeeze is a stock that is weal technically over the past 100 trading days and a short ratio less than 4 with a short intensity less than 30%.

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Follow-up On P Comments From Yesterday

Yesterday we noted that Pandora (P) would report earnings after the close. Estimates were $.01 versus $.02. There is considerable upside to our price target, $11.28, which is based on Cash Flow Return on Investments (CFROI) as well as profitability and growth of assets. Trillions of dollars are managed on a CFROI basis. We note this is a purely quantitative ranking,

We  noted the short ratio was 9.79 which means if the company beats then the shorts will be running for  cover. Our upper bound target is $14.89. This name bottomed at $7.50 and has a gap down at $12.50 that needs to be filled.

So how did we recommend to play it? Aggressive traders buy shares before the close. Less aggressive traders could be a 1/2 position and add or not add on Wednesday morning.

Another strategy  which we recommended would be to buy the stock and buy a December $9 put for $1. If the stock rips, then you give up $1 of upside and are protected on the downside.  Options for December show a bias to the call side BUT there are lots of December 8 Puts with open interest at 16,959.

The result. So Pandora beat estimates by a wide margin $0.04 but warned on Q4 as companies are cautious on ad spending heading into a potential fiscal cliff. The CEO will be on CNBC at 11:40 a.m. EST.

The stock is now at $8.00 and we wrote this up pre market. It opened at $9.11 yesterday. The put is at 1.20 in value whic h is joke but shows the premium. We will take the $0.20 cents out and bring our cost down to $8.91. Let’s see where the stock trades post the CEO interview and whether to sell shares and move on or stay with it.

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After The Close & Morning Chatter Of Note

Below is a format we have created that keeps us focused on what will influence the open AND what could be catalysts for the trading day.

In After Hours Trading

AVAV (+.17), ASYS (-.88), MFRM (+.01), MIND (-.27), P (+.04), PLAB (+.03), POWL (+.34), SEAC (+.03).

What’s Happening This Morning

US futures: (S&P +4.80, DJI +51, NDX +4.50 with fair value flat) Asia and Europe higher. Copper and gold higher with WTI Crude Futures higher. $ is higher vs Euro, lower vs. Pound and higher vs. Yen. US ten-year Treasury Yield +.0043. Prices as of 7:55 a.m. EDT.

Earnings Expected

PBY CWST due after the close. Due Tuesday morning before the open BMO AZO TOL MTN BIG.

Rags & Mags: Inside Wall Street

We are big fans of www.247wallst.com summary of the newspapers each day. Going forward we will link to their website so you can read their summary, Media Digest

Reported Earnings This Morning

BFB ( ), FRAN (+.02), GIII (+.09 ), TTC ( ).

Data Points

Yesterday saw 1440 stocks rise and 1526 fall on the NYSE. NASDAQ saw 1165 rise and 1294 fall. The S&P 500 is still below its 50 day moving average but back above the 200 day moving average. The 10 day spread moving average of breadth is positive and is now back to a buy signal. We are back to invested on the Madison Market Timing Indicator.

 

Economics

ADP releases its November Jobs Numbers pre-market. October Factory Orders are due out at 10:00 a.m. EST and are expected to drop to 0% from 4.8%.

Politico

President Obama speaks to the Business Roundtable. The House Financial Services Committee reviews Dodd-Frank legislation.

Conference & Analyst Meetings

Analyst Meetings SBUX TYPE AEG CP LOW ACW ARG DOX. Conferences of note Wells Fargo MLP & Energy Conference, Goldman Sachs Financial Services Conference and NASDAQ/OMX Morgan Stanley Investor Conference.

Conference of Note

Qualcomm (QCOM) 3G/LTE Summit.

M & A News

Nothing of note.

Key Upgrades and Downgrades

Firm Upgrades Downgrades
JP Morgan
Goldman Sachs WM
Morgan Stanley
Deutsche Bank
Citigroup ADTN
Barclays
Wachovia/Wells Fargo
Credit Suisse
Banc of America
UBS
Lazard
Merrill Lynch
Jefferies
Oppenheimer
RBC
Bernstein
Stifel Nicolaus
CLSA
Keefe Bruyette
Friedman Billings PNC
Baird
Needham
Cowen
PiperJaffray
Thomas Weisel
RBS
Raymond James INTC

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Why The Value Lines Are Important, 50 Day Moving Average Getting Close & Retracements

Yesterday we noted that support on SPY was $140.88. It traded to $140.87 and then rallied into the close to finish at $141.21. Was this a coincidence? No way.

The high fregquency and algo guys knew this level and defended it. Did you? If not, then you should have. We will post the SPY value line levels today so that you are “in the know”.

The second point this morning is that the 50 day moving average on SPY is $142.12. On Monday we moved through this level but failed by day’s end closing at $141.45.

The third point this morning is that the retracements from the November 16th low to the high hit on Monday are now in play if SPY has peaked for the time being. The first test would be $139.71 (38.2% retracement), then $138.75 (50%) and finally $137.79 (61.80%). Remember the market is a series of two steps forward and one step back.

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Value Lines Are Problematic Intraday. Can SPY Hold $140.88?

Each day we calculate on the open resistance, pivot and support. Also key are the five minute opening range and the one hour range.

SPY opened the day below pivot and may challenge support at $140.88 sooner than later. It is important to pay attention to the value lines because if you are a buyer the last thing you want to do is buy when the market is about to get hammered. Same concept in reverse on the short side.

Intraday trends are also important for tracking whether a change of direction is about to take place. Last week ex Tuesday was a positive week for the bulls from an intraday perspective.  So far this week is not off to a great start thanks to the ongoing “fiscal cliff” that looms over the market.

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Potential Short Squeeze After The Close

Pandora (P) will report earnings after the close. Estimates are $.01 versus $.02. There is considerable upside to our price target, $11.28, which is based on Cash Flow Return on Investments (CFROI) as well as profitability and growth of assets. Trillions of dollars are managed on a CFROI basis.

We  note the short ratio is 9.79 which means if the company beats then the shorts will be running for  cover. Our upper bound target is $14.89. This name bottomed at $7.50 and has a gap down at $12.50 that needs to be filled.

So how to play it? Aggressive traders buy shares before the close. Less aggressive traders could be a 1/2 position and add or not add on Wednesday morning. Another stategy would be to buy the stock and buy a December $9 put for $1. If the stock rips, then you give up $1 of upside and are protected on the downside.  We like this strategy the best and will report on the results on Wednesday.

Options for December show a bias to the call side BUT there are lots of December 8 Puts with open interest at 16,959.

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No Tax Selling Since The Election

The day after the election we created a universe of stocks up 10% year to date. Why? Because these names could be sold if the capital gains rate rose. Each we we have been updating the results. The conclusion is there is NO or very little tax selling going on pay a lower rate.

This could change if it becomes apparent the capital gains rate in fact is going up up 5% in addition to the 3.8% surtax for Obamacare. Effectively, taking the capital gains rate to 23.8% from 15%.

Here is a quick summary of our stats. Our stock universe is 6415 stocks. Of this universe, 3650 had market caps above $250 million. YTD up> 10% with market cap above $250 million 1443 ran on 11/6 close.

One month + change of up 10% universe of 1443 stocks > 912 (-71) We have added to the spreadsheet both the 5 year and 10 year returns. We note when we sort by the 5 year return the top 20 returners see 5 down more that -5% in the last month (PCYC LFVN HSTM OCN CRUS). In terms of 10 year return of the top 20 returners one is down more than 5% (ECPG).

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