Trade Ideas for 12/17/08

Nice rally today, and the way looks clear for a small run. However, I'm wary of Fed-induced moves. Sometimes a day or two after Fed euphoria (or, more often, dysphoria), reality sinks in, and the market breaks in the other direction. So I recommend tight stops and keeping your finger on the sell button.

We sold MELI today; just a couple days ago I suggested adding to MELI on weakness, and it turned out to be the only stock of the bunch that didn't rise today. I can spot the pattern, but so often the best-looking ideas don't go anywhere, and seemingly middle-of-the-pack one end up big winners. As for additions, we nearly bought all of yesterday's ideas. The exception was LNG. The official records will show that the high of the day exceeded our buy entry price. However, I was watching this stock. It traded at a maximum price of 3.40 all day. At 1pm, after the market had closed, it traded at 3.70, and that became the official closing price. Yet, I'd call that a bad print. The weird thing is, the same thing happened in LNG two days ago, when it "closed" at 3.45 even though it spent the day trading in a much lower range. Anyway, now we have too many holdings.

Current Holdings
Ticker	Basis	Closing Price	Perf.	Sell-Stop	Additional Exit Guideline	Chart
JWN	13.06	13.13	+0.5%	11.86	N/A	Chart
LIHR	16.21	19.29	+19.0%	17.10	N/A	Chart
X	40.71	40.25	-1.1%	36.66	N/A	Chart
GLBL	3.82	3.68	+3.7%	3.24	N/A	Chart
CHS	3.72	3.77	+1.3%	3.19	Consider selling on a close < 3.41	Chart
FAF	28.07	27.99	-0.3%	25.56	N/A	Chart
NFLX	29.11	28.65	-1.6%	27.22	N/A	Chart
V	54.61	54.77	+2.9%	51.76	Consider selling on a close < 52.64	Chart

We have more than enough positions, but if you missed out on some of the trades, here are a few that look OK for tomorrow.

Trade Ideas for 12/17/08

Ticker	Entry	Exit A	Exit C	Chart
VMW (VMWare)	25.21	23.59	22.99	Chart
TRN (Trinity)	15.21	13.80	13.12	Chart
CNX (Consol Energy)	32.64	28.99	N/A	Chart

Please refer to "How To Trade The Ideas" (right-hand side) to read this table.