Saturday, December 19, 2009

WEEKEND STOCK MARKET MASALA- 19 DEC 2009


OUTLOOK FOR NEXT WEEK
: I am expecting a drop in the indexes early next week and a Santa rally to begin Dec 23rd and end during the first week of Jan 2010. Yes, Santa rally happens after X-mas based on past trading history.

CURRENT POSITIONS (Initiated on 12/18/2009):

1. Visa (V): Jan 90/85 put spread at 1.90

Visa (V) was added to S&P after Friday's (12/18/2009) close. The announcement that V will be added to S&P was made on Dec 11th.

Stocks added to the S&P gain 8.49% (on an average) from the announcement date to effective date (V gained almost 10% between Dec 11th-18th). Then they correct 3.23% (average) within 10 days of the effective date. If this is true, V should correct to 86 before Dec 28th.

http://www2.standardandpoors.com/spf/pdf/index/EventStudy.pdf

2. GOOG: Jan 590/580 put spread at 3.20.

600-605 is a huge resistance zone. I think GOOG will eventually break above it but I am hoping for a small pullback to 580-585 first.

Daneric's chart-

http://3.bp.blogspot.com/_TwUS3GyHKsQ/SyltYX3GM-I/AAAAAAAADDM/p7tn8lb5Fec/s1600-h/goog.png

Equilibrium's chart-

http://chart.ly/7fry4x

WATCH LIST:

1. GS: Target entry at 158

2. POT: Target entry at 104-105

3. GLD: Target entry at 105-107

4. BBY: Target entry at 38



Have a great weekend.

2 comments:

  1. Hey Pra,

    Hope you see this? CNBC had an interesting report today about heavily shorted stocks and that they me become a short squeez candidate due to institutional investor having to cover?

    I thought since your an expert on finding stocks that heavy short interest, maybe you can spend some time seeing if there are any end of year lottery picks?

    Here are a few I know of..

    SHLD
    Blue Nile
    LULU

    and someone posted this when I asked the same on HOB.

    Wont post with copy and paste?????????

    Anyway, he posted on the most recent post on HOB and his name is NebXian...and it starts of with....

    Nile will have to move.....


    Just a thought to possibly take advantage of these moves?

    Best, Paul/Flyboy

    ReplyDelete
  2. Hi FB,

    NILE has overhead resistance at 65. If it breaks above 65, the next target is 69-70.

    SHLD has the potential to go to 88-90. However, the daily RSI is at overbought levels. Weekly RSI is approaching overbought levels too.

    LULU has huge overhead resistance at 30-31. Weekly is very overbought (RSI at 77).

    If I were to pick one, I would pick NILE.

    ReplyDelete