US stock futures point to a lower open on Wall St Friday after disappointing earnings results from JP Morgan (JPM). The banks had a strong run into the report, but JPM could not deliver as revenue fell 18% from the year ago period. JPM stock is off almost 4% this morning, dragging the rest of the sector down with it.
Scott Redler sold his Goldman Sachs (GS) and JP Morgan (JPM) stock yesterday into this report, as we typically do not like to hold stock into earnings. Also, the stock had made a strong run from $30 and change to almost $37 in under a month, and it was due for a rest. How JPM handles the $35-35.20 area will be interesting.
The correlation of one has been broken in 2012, which has created a very nice stock pickers game both long and short! We have a methodical move since the Gap and Go from December 20th. As we churn higher it seems to be a bit riskier to be in Tier #2 or 3 over night, but holding a variety of positions with a Hedge on has been working. By being in some positions it also makes you focus on the intraday action to add for cash flow.
The new floor to watch for composure in the SPY is the $128.20-128.60 range. That’s been holding the same way $126.40-126.70 held a week or so back. Let’s make sure this trend stays intact. I will be watching closely for a big brush back pitch today. Market dips continue to be bought and until we close on the lows see or see change of trend, I will stay with it.
*DISCLOSURES: Evan Lazarus is long RIMM, LULU calls. Short LULU stocks, REGN. Scott Redler is long SPY, OIH, POT, QCOM, NFLX, MCP, RENN, DANG, X, POT, GOOG calls.
SHORT DIA
