Much of my trading success has come from an ability to reduce a wide range of data inputs to a informational common denominator. This is one of the characteristics of the Prepared Mind. I try to filter out the background noise in order to divine the pith of the market. These “lowest common denominators” are not always quantitative. I find cultural touchstones can define the tenor of a market. These can be derived from movies, books, television or music. As Marshall McLuhan said – “The Medium is the Message.”
The messages are conflicting this week. On one hand, I hear market observers echoing the cry of the genius programmer, Boris Grishenko, in GoldenEye, “I am invincible” . This attitude is prevalent in the precious metals markets. These feelings are tempered by Peter Townshend’s warning that he “Won’t get Fooled Again.”
I do not have the answer. I know the markets will go either up or down. There will be a correction in the market. I do not know when the correction will occur and how large it will be, so I avoid predicating my trading strategies on timing market movement. The U.S. Markets are at 2 1/2 year highs. I have mentoring students who are certain every new high is the final high. Do not fall into this trap. Do not pick bottoms or tops. Trade what the market gives you.
Earnings reports continue in full force this week. Here are some of the highlights for the coming week.
Monday February 21:
No domestic economic reports. US markets were closed to observe Presidents Day.
Tuesday February 22:
Economic: December S&P/Case-Shiller Home Price Index – 9:00, Consumer Confidence – 10:00,
Earnings: BTO – Wal-Mart (WMT), Medtronics (MDT) Home Depot (HD), Macy’s(M), Six Flags (SIX), VF Corp. (VF); ATM (After the Market) – Chesapeake Energy (CHK), Chicago Bridge and Iron( (CBI), Herbalife (HBF), Hewlett-Packard (HPQ).
Other: Chicago Mayoral election – Vote early, vote often.
Wednesday February 23:
Economic: ICSC – Goldman Sachs Store Sales – 7:45, Redbook – 8:55, Existing Home Sales – 10:00
Earnings: BTO – Fluor (FLR), Lifepoint Hospitals (LPNT), Loew’s Companies (LOW), ; ATM – Limited Brands (LTD), Priceline (PCLN)
Thursday February 24:
Economic: Durable Goods Orders – 8:30, Jobless Claims – 8:30, January New Home Sales – 10:00
Earnings: BTO – El Paso (EP). General Motors (GM), The St. Joe Company (JOE), Kohl’s (KSS), Newmont Mining (NEM), Potlatch (PCH), Sears Holdings (SHLD). Sempra Energy (SRE); ATM – Salesforce.com (CRM), First Solar (FSLR), Target (T)
Other: Potash (POT) splits 3-1 after the close. Check any open option positions to make sure they are converted correctly.
Friday February 26:
Economic: Estimate of 4th Quarter GDP – 8:30, University of Michigan Consumer Sentiment – 9:55.
Earnings: BTO – Drill-Quip (DRQ)., Cooper Tire (CTB); ATM – Public Storage(PSA)
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