Tuesday was more of a slow day. Maybe its the crazy cold weather we are having here, but the wheels of motion were slower than usual.

When I got up Tuesday I had a strict plan, packed schedule of things to do so was not overly aggressive on the stock plays Tuesday but did pick up and dump a few things. Before I proceed, here is a run down on Tuesday market activity from Bloomberg (again, use previous days news to gauge plays for the next day, some stocks that are oversold, or even over bought one day can be a money maker the next day or two as people take profits or cut losses).

Tuesday I picked up a the following trades:

(JPM) was quickly down and up at the open and sparked my interest in a small rally. With the idea that there might be floor price established for the day and all the negative press already priced into the stock, I jumped in with a limit order for 200 shares @ $25.25 which went through early into the session. I cannot for the life of me hold this stock for took long so was itching to pull the trigger as (BAC) was falling and I feared the same fate for me holding. (JPM) did hold off on the selling and as it hit a peak by the afternoon (which I missed selling at) it came down before bouncing back nicely. I managed to get out @ $26.45. One big reason for the pop in the share price that I need to mention is that (JPM) is going to come out with earnings 1 week before scheduled. More can be read here.

Profit on (JPM) = $240

Another play for Tuesday was (GE). I didn’t expect this stock to come down to my level again as its a good long term hold that seems to be oversold. So I got into the stock for only 150 shares at $14.75 which is close to the day’s low. I know there is a heavy short interest on the stock and I also know that the current downward pressure can be linked to the high attribution of tax benefits in the current profits. Its scary when Barclay’s writes an article saying that about 20cents of the 36 cent/share profit will come from tax benefits. Without those, (GE) is a dead duck. Short term this stock might fall, but over time its a heavy weight that will rise and I will profit from.

Also, as I said yesterday, (SAY) was a real risky play to follow for anyone trying to follow a post really hype. Well that did happen today as the stock moved down like it should. There was 30 million shares moving Tuesday which is almost 4 times the average giving major peaks and valleys throughout the day. I tried my luck on 2500 shares @ and got in based on the pre-market price. I got in @ $1.45/share and quickly sold @ 1.56 which was after watching is quickly hit the day high twice on a bounce back and then steadily fall for the rest of the day. I held this stock for no more than 35 mins, it was that quick of a play.

Total profit on (SAY) = $275

In total today was not bad, I was passive in watching the rest of the boards but did manage to pull a profit of $515 while still working on some side business projects and studying for my medical board exam. Not bad and I hope you have similar results.

(NT) was my sucker of the day. Tuesday the stock fell and many are wondering why. Well plain and simple, Nortel is facing bankruptcy and has a interest payment on a loan due in two days. Currently Nortel has two choice, pay the loan with its limited cash, or default on the loan and use the cash for something else. If Nortel is going to default on its loan, it would signal that the company is looking for possible insolvency and feels no reason to pay anyone back. Link here for article.

Personally, I have faith in the stock and feel that after the panic sell-off, the stock will come back. I’m a little angry for not selling and taking a quick profit before buying back in – I think I said that in an earlier post too. But will take advantage Wednesday on any lower price pressure before the ‘zero hour’ on the whole interest payment fiasco.

Jim Cramer has a video out on The Street where he talks about (BAC) stocks and how its recovery will be a signal of the broader market recovery. He does make some valid points which does make me want to watch the stock a little more. I know (BAC) is at/near its 52wk low. Can it bounce up? I am going to wait for a clear direction on this stock before I get in, even if its in the midst of an upward rally. Like I say, I would rather make a small profit than get hit with any type of loss.
For Wednesday I am looking for the oil stocks as well as the regular bandits that I typically talk about. The Asian markets are up for the first time in a week which hopefully will signal a rally Wednesday on the US side. Any rally and I will be there. Hope you are ready as well.

Happy Investing!

Aman, MBA

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