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Hi Guys,
Many stocks are now short term overbought, but they may not be safe to
short because:
1. The recent santa claus rally may continue, and they can stay
overbought or,
2. The market may gap down at the open and then players may then choose
whether to fade the gap or go with it.
I would be inclined to sit out the first hour tomorrow and try to get a
good feel for the action. I will be watching the ticker for potential
short term plays on the oex and several stocks including:
a) UTI - for a possible short (may already be pulling back for a
possible little short leg down) and
b) FNF(robust mover may have a stochastic pop up left to take it into
higher ground)- for a possible long.
c) MICA- for a possible play either way based on how it handles
tomorrows action (weakness here might mean the end of its current leg
up; strength a continuation). Don't look to make more than a point on
this one unless you follow it closely as long as the position is open.
Do not play any of these picks at the open. Wait for them to move in
your direction first. I would not hold either short overnight unless
it closes into weakness.
These are all short term trades; the term is up to your discretion but
for me it ends when I think the move I buy or sell into is running out
of steam. I generally hold a position for a few hours to a few days.
If you guys want me to continue to post my candidates from time to
time, please let me know via private e-mail.
Best wishes,
James Charles
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