Rally Pausing, BA Beats on EPS but Misses on Top Line

Wednesday, July 28, 2010

Market flat, traders cautious for pull-in

Tokyo had a blow out day up 2.7% and the Shanghai followed with a 2.3% gain. Europe was more muted with a mixed session. US futures are bouncing around breakeven as of right now after some data on durable goods orders showed a decline. Boeing (BA) reported earnings this morning beating with EPS of $1.06 versus $1.01 consensus. BA missed on the top line falling short of the $16.1 billion expectations at $15.6 billion. Guidance for EPS and revenues for the fiscal year 2010 both came in below expectation. Yet, BA is trading down a marginal 24 basis points pre-market. It will be interesting to see how the market reacts to the revenue miss and lower guidance.

Lightening into rally, holding most

I am selling some of my longs into this multi-day move higher as the S&P 500 is up 4.6% since last Monday. My goal though, is to follow the advice of High Chart Patterns and "trade around the base". I believe in the long-term bullish story so I am trying to sell into strength and buy on weakness until further notice. Sometimes I do this well, other times not so well but being active on the margin keeps me in tune and aware of any changes in market conditions.

My "Put Your Rally Caps Back On" article this weekend was well-received in the online world and I was featured on Yahoo! Finance! The guys over at Wall St. Cheat Sheet run an excellent website and helped promote the article. Some of the comments I received were priceless. My favorite: "This guy is an idiot and we are all dumber for having read his garbage. He probably wrote this while wearing camoflage garb in Wal Mart." In fact, I did have camo on!

Disclosure: Long SPY.
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