Momentum Trader Report: 06/25/08

25 Jun

Posted by Mo-Trader as Momentum-Trader Report

The Fed didn’t make any changes to the interest rate as expected, but was less hawkish on inflation in their report today. The market was expecting more emphasis on future rate hikes to fight inflation, which probably would have strengthened the dollar, lowering oil and perhaps causing a rally in the market. Instead, the market pulled back from its pre-fed highs, although all 3 indexes closed higher. The NASDAQ did the best today, but could see some trouble tomorrow. More on that later.

There were 2 triggers from the Watchlist today. The first was MA, which gapped up. It closed below the entry point.

I have always had difficulty trading this stock short term. I think the best way to trade this is to buy a significant pullback, don’t use a stop and hold on for as long as you can.

The other trigger was ATW, it triggered just before the Fed announcement. It had nice volume, although it closed slightly below the entry point.

I’m glad I closed nearly all of my positions over the last few trading days, because I was in fertilizers and energy, and those took a huge hit today. As I mentioned in last nights post, I also closed RIMM because they were reporting earnings after hours today. The results were not good, and RIMM was down 8% after hours. This will likely have an impact on the NASDAQ tomorrow.

Although some traders like to get positioned before earnings, it’s really a gamble. I learned from the Master that you don’t hold into earnings. If earnings are good and the stock makes a big move, look to get in after the next consolidation period.

I still think we could see a rally attempt soon, maybe even tomorrow. But I don’t see many good charts to trade.