I know I've been slacking off on posting to this site lately. I'm still on the sidelines, in cash, waiting out this busy part of earnings season. A couple of years ago I made it one of my rules to take off these earnings laden weeks each quarter (usually the 3rd & 4th weeks of January, April, July and October). I do this for a couple of reasons. The main reason is that I've found those weeks to be highly unpredictable and very choppy (note today's nasty gap down opening). After trying to trade through earnings several times I found that I was better off to avoid earnings season all together. There's nothing worse than being caught on the wrong side of an earnings surprise (see LF's 25% debacle today). The other reason is simply that if I don't force myself to take some days off I'll be toiling at my desk all year long. So I look forward to these weeks as a time to take a breather from trading.
I am keeping an eye on things and am starting to keep a list of potential buys for next week. I may jump back in next week and trade some stocks that have already reported or that don't report for another few weeks. I'm seeing some nice pullbacks. I run a scan that I call 'recent new highs', which filters stocks that have made a new 52-week high within the last 10 trading days. That scan in particular is finding some real nice looking dips. Those stocks will be at the top of my list... assuming that this market-wide dip doesn't do too much damage. :-)
Sounds like a wise manuever. I'll have to keep that wisdom for when I jump into the money making arena. Try to pass this tip on to Dad! ;-)
Michael, I concur with you about the whipsaws that occur around earnings season. The MACD in the NASDAQ 100 whipsawed three times in the last 4 trading days. I follow market technicals and blog my findings about the overall market.
I enjoy reading your blog. :)
Thanks,
Paul
Thanks Paul. I've added you to my blogroll.
It's much nicer watching those whipsaws from the sidelines. Unless of course you're on the correct side of each one. :-)