Archive for May 2009

The Week That Was: May 26 – 29, 2009

May 31st, 2009 | By | Category: General Comments
The action in this shortened week started on a strong note, and finished on a strong note.  After popping above 90 on the SPY in the opening minutes of trading on Tuesday, the bulls seemed to be in control for the most part, never dropping 89, even when it appeared on Thursday that we would be trading down to the lower end of the range at 88.  The one thing I really liked about that selloff was that for the most part financials remained firm, not making new lows, even as the market was.  On Friday we closed right near resistance, in the upper half of the range. We're still waiting for the catalyst for a move in either direction.  Read more [...]


Why Inexperienced Traders Fail to Hold Their Winners

May 31st, 2009 | By | Category: Steven Spencer (Steve's) Blogs, Trading Theory
One of the most difficult skills to master for a younger trader is holding a position for a larger move. I'm going to discuss the reasons that I believe this is the case and some of the things SMB does to help its traders improve on this very important skill. I will also briefly discuss one of the younger traders on our desk who has been working on improving this part of his game. Here is a list of some of the most common reasons why traders fail to hold positions that trade in their favor. 1) The anxiety of holding a position is greater than the emotional payoff from the potential gain 2) The algorithmic trading programs Read more [...]


Fundamentals

May 30th, 2009 | By | Category: Mike Bellafiore's (Bella's) Blogs
Trading is not just about reading charts, or reading the tape.  We also must understand the market's and a stock's  fundamentals.  We are not fundamental traders but we use fundamentals to help us increase our win rate.  For the intraday trader we use fundamentals very specifically.  Let's discuss. We used fundamentals to help us profit in JCG yesterday.  Yesterday JCG blew out its numbers.  JCG beat on the bottom line, revenues, and going forward. Their results were better than the Street expected.  This is likely to attract new buyers to a stock.  As an intraday trader when a stock offers surprisingly positive sales Read more [...]


The Face of a High Short Interest

May 29th, 2009 | By | Category: General Comments, Mike Bellafiore's (Bella's) Blogs
Before I trade a stock I check its short interest.  Why?  Because it may affect how the stock trades.  Simply, the higher the short interest the more buyers there may be intraday.  26 percent of the float is short JCG.  I considered this with my every trade today.  Let's discuss. In our SMB AM Meeting we discussed 25 as resistance in JCG.  On the Open JCG tested this level, it held, and JCG traded down a point.  JCG rebounded towards 24.80.  And then the fun began. GMan announced, "There has not been a green candle that has closed above 24.80."   Now 25 had been resistance.  And our charts were showing weakness. Read more [...]


SMB on CNBC HALFTIME REPORT (in the studio)

May 29th, 2009 | By | Category: General Comments, Jeff Tomasulo's Blogs
Jeff Tomasulo, senior trader at SMB Capital, appeared today in the studio on CNBC's Fast Money Halftime Report. Watch the clip here and leave your comments on this blog. Best of luck with your trading! Don't forget to follow us on twitter. Read more [...]


SMB on CNBC HALFTIME REPORT (in the studio)

May 28th, 2009 | By | Category: Jeff Tomasulo's Blogs
Jeff Tomasulo, senior trader at SMB Capital, appeared today in the studio on CNBC's Fast Money Halftime Report. Watch the clip here and leave your comments on this blog. Best of luck with your trading! Don't forget to follow us on twitter. Read more [...]


Sabotage

May 27th, 2009 | By | Category: Mike Bellafiore's (Bella's) Blogs
Today on the desk I heard,"Oh that MON is so hard." And it was at times.  In fact it was very difficult about 90 percent of the trading day.  But it was not hard.  There were three simple trades that if made would have left even the average trader profitable.  Let's discuss. At 82.75 the offer would not lift in MON.  I got short.  MON traded down a quick 65c.  I know, who is better than me? At 82.50 there was a battle.  After the housing number was released initially SPY spiked.  But MON could still not trade above 82.50.  Can anyone say Relative Strength Play?  MON had now showed us her cards.  MON was weak. Read more [...]


SMB on CNBC HALFTIME REPORT

May 27th, 2009 | By | Category: General Comments, Jeff Tomasulo's Blogs
Jeff Tomasulo, senior trader at SMB Capital, appeared today on CNBC's Fast Money Halftime Report. Watch the clip here and leave your comments on this blog. Best of luck with your trading! Don't forget to follow us on twitter. Read more [...]