10 Things You Need to Know on a Monday Morning
Traders ready for a fresh five-session set.
1. The Research In Motion (NASDAQ:RIMM) BB10 launch is Wednesday. While we've been all over this stock since it was a single-digit midget, and given the stock is up close to 200% since September 2012, keep your risk tight on a trading basis lest we see some "buy on the rumor, sell on the news."
2. If and when Apple (NASDAQ:AAPL) rallies back to $500, remember that past support is future resistance and that Technical Analysis 101 dictates that the time to short (buy) a stock is on the re-test of resistance (support). And remove emotion from the process; emotion is the enemy when trading.
3. Did I mention that the VIX (^VIX) is edging toward 15-year support?
4. Gold, with lower highs (sign of distribution), has edged through the 200-day at 1663. As commodity volatility is typically a precursor to equity movement, we would be wise to watch the yellow metal.
5. The bulls won't raise an eyebrow until NDX (INDEXNASDAQ:NDX) 2700 and/or S&P (INDEXSP:.INX) 1460/1435 is breached to the downside.
6. Cognitive biases impact your performance. Be honest, how many do you fall prey to?
7. While our technical target was/is S&P 1520, I dipped a toe into some April S&P puts late Friday for a trade (with a stop above S&P 1525). For what it's worth, the position, small as it is, felt extremely wrong all weekend, which is either a sign to pare/tighten risk or an indication that it's directionally right (as the best trades are the hardest fades).
8. Societal acrimony finally cracks the top .00000000001%, impacting the haves and the have-mores.
9. TrimTabs reported that January equity inflows was a record $55 billion. The previous record was February 2000, "just before the technology bubble popped." (Hat tip: Carl Quintanilla)
10. I'm still holding a handful of Goldman Sachs (NYSE: GS) puts, which were added last Wednesday with a tight stop above the weekly high ($146.50). The stock underperformed its peers in the latter half of the week so it's possible that the insider sales window has been open and the weakness will be relative rather than absolute. It was -- and is -- a pure trade as I look to "hit 'em to quit 'em" and squirrel a few acorns.
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Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at email@example.com.
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