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Daily Market Update – May 6, 2014 (9:30 AM) Yesterday saw an impressive turnaround following a nearly 130 point drop. But it doesn’t look as if today will have much in the way of follow-through. As it was, there wasn’t much reason for the fall, other than to play “follow the leader,” having taken Europe’s cue. Likewise, there wasn’t too much reason to turn things back around, either, other than the closure of the European markets. The biggest story of the week is likely to be today’s lock-up expiration of Twitter and some kind of celebration of the fourth anniversary of what is known as the “Flash Crash.” While Twitter shares are pointing sharply lower in the pre-trading market, if there’s any remote resemblance to the case of Facebook, as it faced its first big lock-up expiration, it will mark a trading low and an opportunity to start accumulating shares. That may or may not help me to rollover some existing puts that were done for my personal trading, but it may open open forward opportunities. Beyond Twitter, it’s still amazing that no one can explain what happened that day in May when I was headed to the garden store with my wife driving. Even if being able to use more than 140 spaces to do so, still no one can explain. While listening in disbelief to the radio I wanted to grab the steering wheel from her and car jack my own car so I could get back home. But instead, she got peonies, while I got hosed. That was a day that created lots of trust in the system. The fact that they can’t explain what had happened and initially tried blaming it on a “fat finger,” shouldn’t leave too many people with an abiding sense of security. Yet, we go on, because it’s still the best place to be, even with lots of hiccoughs and lots of irrational behaviors. Imagine that if the “smart money” acts the way it does, just how bizarre must be the behavior of you and I. After a fairly busy day yesterday, I’m not expecting many more new purchases for the week, although looking at some pre-market drops in specific stocks, like AIG and Holly Frontier, both earnings related, I get interested in saying hello to some old friends. But lately some of these earnings related drops have been lasting a little longer than usual and aren’t the same kind of slam-dunk purchases as they may have been a year ago. In a market that went only higher even disappointments were quickly forgiven. That’s just not as certain in 2014. So while the money is there, I may be a little more discerning and maybe wait for even more selling. With enough new positions to probably keep me satisfied for the week attention then gets diverted to what has been increasingly important. That is to make existing revenue stream The weakness yesterday, even with the turnaround, didn’t do very much to help achieve that latter goal and this morning’s preliminary weakness isn’t doing much, either. Hopefully the market will just do what it has been so good at doing in the past and just move higher, with or without a catalysts. Unfortunately, there really don’t appear to be any catalysts on the horizon that might send shares higher, but there are enough things on the near term horizon that could introduce some nervousness into the equation. While I always have at least one antennae up to figure out what curve balls may lie ahead the preponderance of uncertainty isn’t really overwhelming. Especially since it all seems so obvious and is on everyone’s radar. Those just seem to be good times to do more than dip a toe in.
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