Fading Emotion
Trading emotional extremes can often be a good spot to be in. Why? Because it
puts you on the same side as the market makers and specialists, who are not in
the game because they lose money.
Â
09:20:11
Important Upgrades and Downgrades:
Â
Cerner(CERN)
Merrill Lynch downgrades to “reduce/sell” from ” buy” .
Johnson Controls (JCI)
Deutsche Bank initiates coverage at “strong buy”
Allegheny Energy (AYE)
Merrill Lynch downgrades to near-term “neutral” from “buy”.
Delphii Corp (DPH)
Deutsche Bank initiates coverage at “buy”.
Â
09:39:04
Intraday Setup Alert
Cerner (CERN)
has gapped down below the 2.0 volatility band at 47.40. The stock is being
gapped lower after being downgraded by Merrill Lynch Friday morning. CERN is
down 4.25 at 45.25.
Â
Cerner
(
CERN |
Quote |
Chart |
News |
PowerRating) is in the news this morning after a MER downgrade, and
gaps down in the pre-market action. This action gaps it down below the 2.0
volatility band, which those of you familiar with this tool know has a 95%
probability of containing the price within that level. Since it has gone past
it, the likelihood of a reversal is high.
Â
Â
The stock reverses within the first 15 minutes, and entering on
the first new high with a tight stop protects you in the event you are wrong.
This is counterintuitive to the way many trade, but keep an eye out for these
situations, and soon you may be taking advantage of them as well.
Have a great weekend!
Duke