{"id":484,"date":"2009-04-02T21:15:09","date_gmt":"2009-04-03T02:15:09","guid":{"rendered":"http:\/\/www.smbtraining.com\/blog\/?p=484"},"modified":"2009-04-03T07:17:08","modified_gmt":"2009-04-03T12:17:08","slug":"psychology-drives-price","status":"publish","type":"post","link":"https:\/\/www.smbtraining.com\/blog\/psychology-drives-price","title":{"rendered":"Psychology Drives Price"},"content":{"rendered":"<p><a href=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2009\/04\/rimm-04-03-09.bmp\" title=\"RIMM 04-03-09\"><\/a>RIMM reported after the close today.\u00a0 It traded up over 20% from its closing price.\u00a0 You are going to read a lot of articles about how they &#8220;blew away&#8221; expectations and gave great guidance.\u00a0 The articles will assign these as the reasons for RIMM&#8217;s explosive up move after the market closed.\u00a0 Really?\u00a0 I don&#8217;t think so.\u00a0 Do you believe that if RIMM reported three weeks ago that it would move 10 points higher in the after market?\u00a0 Of course not.\u00a0 Three weeks ago the world was coming to an end!\u00a0 A good earnings report would lead to maybe a 2 or 3 point up move followed by an afternoon selloff.\u00a0 But we have climbed the &#8220;wall of worry&#8221; for the past two weeks.<\/p>\n<p>Market psychology has changed.\u00a0 Investors are now beginning to think more about potential upside.\u00a0 They look at RIMM 100 points off its high and still earning lots of cash.\u00a0 Maybe it can run 20, 30, or even 40 points?\u00a0 Each time that the market sells off in the afternoon or has a large gap down in the morning there has been no follow through to the downside.\u00a0 The market continues to creep higher.\u00a0 There is a shift in psychology.\u00a0 Some of the bigger market players are less afraid to put money to work (and boy were they afraid for quite some time).<\/p>\n<p>One of the traders in my row told me this morning that some of the larger hedge funds are planning on shorting the market now that the SPYs are at 84.\u00a0 Great news.\u00a0 We can see what type of pull back this selling will produce.\u00a0 If this new round of selling is unable to move us below 78 on the SPYs we will continue to push higher.\u00a0 Possibly another 10 to 12 points on the SPYs.\u00a0 Go back and check the charts for the S&amp;P 500 in the early 1930s.\u00a0 There were several 50% up moves in the heart of the Great Depression.<\/p>\n<p>With all of the above in mind I will be trading RIMM tomorrow.\u00a0 In the after hours it closed a little above $60.\u00a0 Perhaps it won&#8217;t trade much higher tomorrow.\u00a0 But I am open to the idea that in the coming days and weeks it may have another 10 to 15 points of upside.\u00a0 I will watch the <a href=\"http:\/\/www.smbtraining.com\">tape<\/a> closely to judge the strength or weakness of the stock and will trade accordingly.<\/p>\n<p><a href=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2009\/04\/rimm-04-03-09.bmp\" title=\"RIMM 04-03-09\"><img decoding=\"async\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2009\/04\/rimm-04-03-09.bmp\" alt=\"RIMM 04-03-09\" \/><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>RIMM reported after the close today.\u00a0 It traded up over 20% from its closing price.\u00a0 You are going to read a lot of articles about how they &#8220;blew away&#8221; expectations and gave great guidance.\u00a0 The articles will assign these as the reasons for RIMM&#8217;s explosive up move after the market closed.\u00a0 Really?\u00a0 I don&#8217;t think so.\u00a0 Do you believe that &#8230; <a href=\"https:\/\/www.smbtraining.com\/blog\/psychology-drives-price\" class=\"more-link\">Read More<\/a><\/p>\n","protected":false},"author":143,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[18,81,218],"class_list":["post-484","post","type-post","status-publish","format-standard","hentry","category-steven_spencer_steves_blogs","tag-smb-capital","tag-smb-training","tag-trading-equities","no-post-thumbnail"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.1.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Psychology Drives Price | SMB Training<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.smbtraining.com\/blog\/psychology-drives-price\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Psychology Drives Price | SMB Training\" \/>\n<meta property=\"og:description\" content=\"RIMM reported after the close today.\u00a0 It traded up over 20% from its closing price.\u00a0 You are going to read a lot of articles about how they &#8220;blew away&#8221; 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