Wang’s Happy Trading

Submitted By OptionDragon

Journey - Don’t Stop Believing

From briefing.com

LEH reports Q1 EPS 81c vs. consensus of 72c-Bloomberg
Reports Q1 revenue $3.5B vs. consensus of $3.35B.
LEH gapping up.

Refiners got downgrades today. WNR downgraded to Underperform from Market Perform@BMOC.
HOC downgraded to Market Perform from Outperform@BMOC.
FTO downgraded to Market Perform from Outperform@BMOC.
TSO downgraded to Market Perform from Outperform@BMOC
VLO downgraded to Market Perform from Outperform@BMOC

GS reports Q1 EPS $3.23 vs. consensus of $2.58
Reports Q1 revenue $8.34B vs. consensus of $7.47B
GS saw ’strong customer activity’ in many franchise operations. GS gappingg up strongly.
Goldman Sachs (NYSE: GS) raised to Outperform at Wachovia.
GS gapping up.

Amazon.com (NASDAQ: AMZN) started as Buy at Canaccord Adams.
AMZN: Remain buyers of shares at current levels@DBAB
Deutsche Bank thinks some of AMZN’s services like Amazon Prime and super saver shipping could offset some of the risk from the slowing industry landscape. They maintain a Buy rating and $110 target. Third upgrade in a week.

Reuters writes that Google (GOOG) says it is well positioned for an economic slowdown.
Reuters reports that a big federal bail-out of housing is gaining momenturm.
The Administration is proposing easing lending restraints on Fannie Mae (FNM) and Freddie Mac (FRE) as a way to help the housing market.
The FT reports that the pressure is on the Fed to cut up to 1.25 points.

AAPL: Notebooks/desktops are keep for potential upside in Q2@BOFA
Banc of America believes PC unit upside could come from new product build-out, channel inventory replenishment, and strong demand. They also think gross margins could surprise to the upside in Q2. Banc of America thinks their Q2 estimate of $1.07 could prove to be 8c conservative and reiterates a Buy rating.

Mad Money- Cramer still bullish on Visa IPO. Cramer recommended companies in the “real” economy such as those that manufacture products. These companies, which all benefit from a weak dollar, include: PG, CL and PEP. He recommended strong companies in the tech sector: CSCO, INTC and AAPL - all have strong balance sheets. He also reiterated buys in the agriculture sector: CAT. And he also likes MMM, HON and XOM. LIGHTENING ROUND: (Bullish) AUY; COP; ANDE; MHS; CVS; FRO. (Bearish) IBKR; ABC; BIDU; SGMS; NYX.

Fast Money- Macke Owns (YHOO), (INTC), (EMC); Pete Najarian Owns (AAPL), (C), (CSCO), (ETFC), (MS), (MSFT), (XLF), (YHOO); Pete Najarian Owns (COP) Calls, (GS) Calls; Pete Najarian Owns (LEH) Puts, (XLB) Puts; Pete Najarian Owns (MF) And (MF) Puts.
Gartman was on and said, “I think there could be downside in commodities, says Gartman. I did a very material liquidation of my positions in commodities and for me to do that, well that’s very hard. I still own gold but I got out of the DBA because it didn’t hold any of it’s gains early on.
Gartman bought JPM.

Oppenheimer Chief Market Technician Carter Worth joins the panel for this conversation. Following is a summary of his main paints.
“I don’t think we’ve come close to a complete capitulation, which would signal a technical turnaround”, says Worth.
Those signs would include the following:
1) Persistent Weakness
2) Definitive New Low
3) Must Close On The High Of The Day
4) Massive Volume
So far, we have only had persistent weakness. I still think the financials and the S&P will continue lower, he adds. Too many traders are bullish for the market to really turn around.
Pete Najarian likes IBM and AAPL. Macke likes WMT.

Zachary Karabell, Executive Vice President and Chief Economist at Fred Alger Management joins the panel for this conversation. Following is a synopsis of his main points.
– This is not a housing crisis anymore, it’s a credit crisis as well as a Wall Street crisis and a securitization/derivatives crisis, Karabell says. Although it started with mortgages it’s taken on a life of its own
– What’s going on now seems like Armageddon but real-world investors should not overreact, because the real-world economy is in good shape (In other words, rates are low, job market is robust etc.)
– There is more than enough room in the federal budget relative to ‘GDP to debt’ to pay for a bailout. We are not fiscally constrained.

VISA IPO is pricing today.

I’ll be looking for longs til the Fed meets then let the knee jerk reactions play out before deciding which game plan to adopt. The 4 Horsemen esp. AAPL will be a focus. LEH, JPM, GS also long ideas. POT and DBA as long ideas. Possible shorts if the market shows weakness, STR, XLE, PPG, AGN, XNPT.
Now that the Fed has opened the discount window for all financial institutions including B/D’s, I think the liquidity crises has subsided greatly so shorting financials to oblivion is a low probability now. I expect a big cut from the Fed whether it is 75 or 100 it doesn’t matter, what does matter is how the market reacts to the cuts after initial customary knee jerk reactions. Be patient for clarity and try to initiate positions into contrary moves to the trend.
Be cognizant of a continuing sector rotation into underperformers from recent outperformers. Out of energy to lock in gains in the short term and going into tech and financials. If we can get a strong push in these two areas a bottom could well be in place for the whole marrket. Time will tell.

Art Cashin says that the shorts are nervous more so than anytime in his 40 years of trading. Shorts keep getting blindsided. Rumor mongering is being focused on as calls are being made around the desks to give warnings. Art does like the market action for a start of a bottom possibly.

Good Luck and seek the zone, stay in the zone and keep positive.