TRICK OR TREAT?

I have to get a halloween costume for my boy. Have to get it on or before the 31st of October. Makes sense, timing is everything.

Talking of timing we better get that right as traders. Sold YHOO at 34 yesterday. That was the closest call I ever made. Bought last week at 30.25 (scroll down my blog archive) and sold yesterday at 34. The Alibaba IPO effect had to be shortlived I knew and we sold at the first glimpse of momentum in the stock. Believe it or not we got 34 at the open yestereday, missed a heart beat to see that the stock closed at 31.75 or so. And it is down another buck today at 30.75. Do we buy it back. Looks like a good trade again. But no, I move on to the next pick. Timing means a lot for short term traders. To be able to get out at the right price and right day...

Not much to say ahead of the Fed meeting. We raised cash and I dont find any buys except for one in the technology sector. BRCM. We had a nice ride last month from 32 to 40. And after earnings that were not that bad the stock got hammered all the way to 32 again. It reflects a technical move as well and if technology is as great as it is pointed out to be ... BRCM will recover nicely with a tech rally. SO thats a buy at 32.2 right now.

The financials have been all over the place and a traders delight. Instead of paying attention to the exact mess that Merrill is revealing in the management camp... buy low and sell high works well. But buy the other financials, stay away from Merrill itself. Too much negative reaction on disappointing appointments at Merrill can lead to more damage than we as laymen can perceive. When Merrill collapsed to 60 last week... LEHMAN pulled back to 54 in sympathy and we had a great time buying them at 55. When word got out that Merrill CEO will step down etc. dont know where it traded... but got a chance to sell LEH at 61 and change. So watching the price action is a good tip for traders.

If the financials pullback some more before or after the Fed meeting they may present a chance to buy. Morgan Stanley in the low 60s or Lehman in the 58-60 level look good to me.

About the Fed action tomorrow seems the market is expecting at least a 25 basis rate reduction. Lets hope for that. When my child does not get his halloween costume when he expects it- on or before halloween... he gets mad. If themarket does not get what it expects it will I am afraid get mad, very mad. And a collapse is not out of order. 25 basis, Mr. Berny if you are our friend. Trick or treat, whats it gonna be? We shall see...
We have cash to make it work so lets watch.... good luck... and dont fret what the FED does... make the most before and after... what they do.