Hello all! Yesterday, we had a nice with our picks. To start, we recommended a buy of Domino’s Pizza Inc. (DPZ). The company seemed undervalued going into the earnings report it released this morning, and it appeared to present a solid buying opportunity as investors would buy up the stock going into the earnings. We played that upswing, getting in in the morning at $9.00 per share. From that entry price, we were able to exit in the afternoon at 9.27 for a solid 3% gain. On the short sale side, we were looking for Brocade Communication (BRCD) to decrease in price after receiving a downgrade from Oppenheimer. The stock initially decreased almost to a 2% gain from our entry of 9.35, but the stock increased throughout the rest of the day. We were forced to sell at the end of the day for a 2% loss at 9.53. We will take the 1/2, and we were very close to 2/2. Hope you were able to make some money.
Let’s get to Tuesday!
Buy Pick of the Day: Ultrashort Proshares Real Estate (SRS)
The market does not look prepared to continue its rally today. With Johnson and Johnson slightly beating expectations and increasing profits 1%, investors do not appeared impressed. Futures are up only handful of points going into the start of the day. The market did not get much in way of economic data this morning, and the only major earnings mover was JNJ. The market seems to have priced in a lot of earnings hope in the past few sessions. How much more can that occur? Today, we may see some small pullbacks from various sectors as investors take a breather.
Futures have continued to decline, and it may be time to get into one of our inverse ETFs that can make us some money. An ETF we have not looked at in some time is Ultrashort Proshares Real Estate (SRS). Real estate has been relatively quiet over the past couple weeks, and the ETF has decreased some 10% in value. It has been relatively slow moving, and it looks ready for a breakout as the bollinger bands have squeezed very tight around the stock price. A good day of selling off could make this ETF pop.
What is the catalyst? The ETF is up over 1% in pre-market trading, and it may be not so much that there are solid fundamentals to…