t2K - I've been away from old softie, because once it convincingly broke out of the trading range below 80, I set it on autopilot, knowing it will do quite well (in my "investment portfolio"). I am not trading it, because there is more volatile stuff out there, but I am extremely comfortable w/ it long term. It is my belief that it will of course run toward earnings (90 is still very fresh, and MSFT is trying to consolidate it into short term support, so I am not excluding a short dip below 90, but otherwise the next resistance is 95, and then of course 100 which it may very well break) but I also expect it to sell off soon after the earnings release. I also expect the market to be quite nasty going into the fall, and I think the nastiness will start early. So, softie will decline together w/ the market. I think it will be another great opportunity to load up on great stocks, including MSFT. My target remains 140 by April 2K.
Re NITE - I've traded it pretty intensely, but I freely admit I'm somewhat puzzled by it - my FA and TA are not squaring w/ each other, and I am always uncomfortable when that happens. From a fundamental point of view, it has everything going for it over the near future - great business, I expect blow-out earnings, it has stellar institutional support (including the worthless analysts, for whatever its worth), steady drumbeat of good news about expansions, hirings etc. But technically, its been acting very poorly. True, this week it has appreciated almost by 25%, but that was after a long period of pain, and I definitely do not like the way it has been trading. There seems to be determined selling, and huge resistance in the 60-62 area. There have been rumors about shares being unloaded, and there may be some truth to it. EGRP (Etrade) had a stake in NITE, part of which it sold (I believe 1.5 mil shares) in order to make its bottom line look profitable, and that surely hurt the stock short term. Also, there are quite a few shares which will be coming out of lockup status after July 13, and the rumor is, that in anticipation, there is a lot of shorting going on - by the way it trades, I can easily believe it. My take on all this is that fundamentally it is a sound stock, so a longer term "investment" approach will work, but that in the intermediate term, in the sense of a few months, there may be some pain. From a trading perspective, it has to be a very short swing trade, with intraday babysitting. Basically it has next week to prove itself. If it does not break and *hold* above 60 next week, I would step aside and just watch it.
As to LII - please be careful, it is not a simple matter to read it, and it has gotten harder, as MMs have caught on to the fact that the use of LII by the individual trader has really spread - so they are covering their tracks well. My advice would be to use it sparingly as far as trading - it is easy to get lost in the minutiae; keep the overall scheme of resistance and support levels of your stock in mind, as well as the overall tone of the market - don't try to catch every little wiggle... that's a prescription for monetary loss and overtrading. Learn the basics: who the MMs are, who the axes are in the stock, identify the ECNs, learn the way MMs post, vs the way ECNs post, understand the relationship between what you see on the LII & T&S, learn the rules regarding trading by MMs and ECNs, etc. Once you learn that, you will understand what you are seeing on the LII. At that point, spend a lot of time just watching the LII, and trying to "read" it. Finally, you are ready to use it. What can you use it for? Most immediately, it will help you w/ your entry/exit points when trading, and more globally, it will tell you what is happening in the stock (who is selling/buying, retail vs intitutions, is it under accumulation, distribution etc.). But always keep in mind - what should guide you, is your TA work, charts, and knowledge of support/resistance levels, and how a given stock trades - at that point you can use the LII to help you execute your trades, and help you learn what is going on w/ your stock.
Anyhow, that's my take. Hope all is going well for you!
Cheers,
Morgan
PS I guess, your PFE has been made whole? The key, in my view, is to buy PFE below 105 (obviously the lower, the better, but its hard to pick a bottom on this stock). Longer term you should do well w/ it. |
