The Kirk Report

Tricky Trading

While the afternoon session was a little tepid, the market managed to climb higher for a third straight day.

This morning's "there's no recession in America" GDP, initial jobless claims, and falling oil prices and dollar strength were cited by many as positive catalysts. With that said, I think three other things are also in play. Along with end of the month window dressing, the fact this market has yet to put two straight weeks of declines since March (yes it has been that long) continues to embolden the troops. In addition, the overwhelming fear of being left behind as oil prices drop especially ahead of another first day of the month rally is playing a role, whether subconsciously or not.

In the meantime, making things especially tricky for short-term traders is that every day is a new day where the trends from the day before don't seem to stick for the next. Today we saw strength in financials, tech, retail, and healthcare / biotech while the commodities were sold. On an intraday basis, as soon as short-term overbought readings were hit late this morning, stocks pulled back this afternoon.

All in all, I am glad that I'm not trying to grind it out this week. Based on what I'm seeing within my end of day scans, I'm sure I would be having a tough time of it if I were.

For tomorrow, I'll be here at the open and share some more chart reviews, but I'll be gone for the rest of the day after that. I appreciate your patience this week as I'm juggling quite a few unusual tasks. Have a great evening!

Kirk's Mailbag

Between meetings today, I had some time to answer questions. Here are the topics I’ll cover this week:

• The dual purpose of a simple moving average screen

• All tools you use must have good ROI

• Using a bond fund as a hedge

• Different screens for different market conditions

• Sources to track money flow into equities

• My view on Joel Greenblatt's strategy

• Challenge of sector-focused investing

• Top secret technical indicators

• An update for my junk stocks screen

• Your top priority after you've made a mistake

• I utilize limit orders more than market orders

• Trading capital needed to transition into a full time trader

• The relevance of short squeezes

• Why I don't do in-depth debt analysis

• Using median trend lines for overbought stocks

• Concerns over dark pools of liquidity

• Disqualified stocks within my stock screen machine

• Entertaining a short sell of oil and gas through a popular ETF

• The need to temper your expectations

• Did my screens fumble the ball with coal stocks?

• What the market really wants to believe in oil prices

• My thoughts on a members' uptrending screen

• Who I look up to and idolize

Sorry. This is a members' only post. To read, please login.

GDP, Jobless Claims, M&A Speculation

Good morning. Premarket futures have provided mixed signals to the day ahead as investors sort through the latest GDP report, inline initial jobless claims, and continued M&A speculation surrounding both tech companies and airlines.

Premarket gainers: KOSN, JAS, HIMX, DBRN, EXPE, GNVC, BEXP, FRED, JOYG, TIVO, CRNT, LCC, CWTR, JRJC, IPHS, AIMC, BUCY, COST, GCO, UAUA, CELG, HUBG, & GILD.

Premarket losers: ACEL, FVRL, RBS, PENX, MW, AINV, ESLR, SPWR, JASO, NFLX, AKNS, CSUN, CSIQ, ENER, JNPR, SOLF, PDE, SCMR, JST, DCP, & BHP.

In sum, we don't have a lot to work with this morning. Other than more Fedspeak throughout the day, the weekly oil inventories are due out at 10:30AM. Crude is trading lower ahead of this morning's data.

From what I see so far, I expect to see more choppy action as traders await for a breakout above S&P 1400 (or a breakdown below 1375) to trade from. Keep in mind that the large rallies we saw both on April 1st and May 1st this year will motivate investors to have some money positioned ahead of next week just in case we have another first day of the month jump.

Have a terrific Thursday!