EDGE TRADER

Friday, July 29, 2005

My cards should say "Reclamation Engineer"

This morning I enjoyed a brief moment of peace as I compose the plan for the day. GLW gapped up slightly and CHK gapped up considerably thanks to higher crude (again over $60) and a favorable mention on CNBC last night. I've been watching NGPS with interest lately. This stock must be day trader heaven - the spreads are immense and it bounces up and down like a superball. It looks tempting to get involved but somewhere in the back of my mind a wiser voice is telling me that putting my hand in a running meat grinder might be safer.

Slow Friday and lots of work to do - too much weakness to sell today, Tuesday at 9:30 is looking good to convert some paper back to cash.

So a little about one of my investment strategies. I like to think of myself as a "garbage picker". I look for the stocks that people threw away today to see if there is anything worth salvaging for a short swing trade. Today in the trash I found SYNA (too bad I already had some), SYMC, IVGN, KCL, and AAPL. There were others there that I would be all too happy to leave in the trash. Among them, HANS, TUNE, and GOOG.

Another trash can resident that has captured my attention is SYNX (-8%). The only spam I don't block is the pumper and dumper stuff emailed to my account. SYNX showed up in my email and my fax, so for kicks I put it on my watch list a few days ago just to observe the carnage. I have been amused to watch my unseen pumper have a lot of success (go to cbsmarketwatch.com and look at the chart!), although the clock may be ticking on the poor souls owning this one. I am watching this one in the same way your eyes are unfortunately attracted to the dead deer on the side of the road.

Anyway, back to the game plan. It's really simple - review gap downs for the day, choose wisely, buy between 3:50 and 4:00. Sleep fitfully. Wake up, dress, shower, shave, take kids to camp, return, sell stock, go to work. I'm not going to trade the lights out with this approach, but in most cases I bring a few extra bucks home each Tuesday, Wednesday, Thursday, and sometimes Friday.

Today I reached into the trash and pulled out a slice of an Apple! Yesterday's GLW was not really a garbage picking expedition, but so far I am happy with it. Monday or Tuesday we may say goodbye to it - next week is the week to clear out all questionable inventory in the warehouse so we can calmly listen to AG speak.

Book of the day: Nicholas Darvas - How I made $1,000,000 in the stock market. I ended with a sideways week, and was thinking about this book as I was ordering my lunch at Moe's (ah I wish there was an IPO). Very 60's and all Technical Analysis. That book always reminds me that good things can happen to people who are playing the game.

PS - I wish Wendy's would spin off Baja Fresh - now there would be a reason to own WEN!

2 Comments:

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