Off the Report

The headline number is better than expected but again the previous month was revised up. The underlying numbers are absolutely dreadful as more and more employees are forced to work shorter work weeks. This seems like the first step into an employee getting layoff and we might be set for a shocking number over the next couple months. The market remains overbought in the short term and I think this will give the bears the ammunition to start getting aggressive. I will be looking for some good R/R spots in the early trade.

I went ahead and locked in the rest of my gain on YGE and JASO but will remain high on watch if the market stabilizes.

Update 1:00 PM The market seems to be stabilizing and defending the 890 level. An important thing to notice is how light the volume is on the S&P after what seems to be very bearish news. This probably means that most of the selling is done and investors are now waiting to put money back to work. Maybe they are waiting for all the next quarter reports to be out or maybe they are planning to wait even longer until the unemployment rate shows an improvement. But when it comes down to it I make the majority of my money playing charts in conjunction with fundamentals and commodity prices. Oil dipped again below the $40 level and it seems like this level my be well defended. So I am going to put some money in a couple of stocks with good looking setups for next week.

Two of them are commodity plays of the list we have been generating in DNN and XTXI. I have took decent size in both but left room to add next week. The other stock is STX which has been hot of the CES this week. It will soon release a product that will compete with the Apple TV and could give the company huge growth potential. I am small here but will add aggressively if the volume continues to roll in.


JAX