Most scans with a volume composite are fairly useless today, as expected on a shortened holiday trading session. There are a few names worth watching, such as Emergent BioSolutions (EBS) with a strong-looking daily chart thus far this morning.
Under the same guise, Demandware (DWRE) and Destination XL Group (DXLG) have the potential to look very good when we come back next week. Teva Pharmaceuticals (TEVA) and Insperity (NSP) have the same technical look as MGP Ingredients (MGP), just without the big price breakout yet.
You might catch a squeeze from TrueCar (TRUE) or Six Flags Entertainment (SIX) or even 21ViaNet (VNET), but I don't think we'll see it today. Not everything is bullish, though, as American Woodmark (AMWD) and Baidu (BIDU) show breakdown risk here. Overall, though, don't expect much action today. It's one of those low-stress days as I see it. This is the kind of day where I'll tinker with my scans and review trades if I do anything at all.
We'll spend the next week talking about what worked and what didn't work in 2015 and who had the best returns as a portfolio manager. Expect plenty of victory laps (and marketing) on Twitter for those who dominated 2015, even if the numbers aren't audited. But try and remember life isn't about Jan. 1 through Dec. 31, so why should your returns?
Unless you're a portfolio manager, stay focused on your long-term vision. Maybe the last 12 months weren't great, but the last five have been. Does that mean you should scrap your thesis because you read about someone getting 30% or 40% returns? It could, but until you break down what's behind those numbers, don't be so fast to act.
Perhaps they experienced huge drawdowns that would have made most folks throw in the towel, or maybe they just took a lot of risk. Could their results been driven by just a handful of trades? Sometimes it only takes a little luck to grab a stock or some options days or hours before the company announces they are being bought out for a huge premium.
Don't be seduced by 12-month numbers. It's a single, static point that truly offers little value. If you are tempted by a private portfolio manager or trading service, then ask for rolling numbers, drawdown percentages, value at risk (for those who find value in it) as well as a redacted trade log.
Testimonials are great, but unless you know someone personally, those testimonies could come from friends, family or even paid individuals, although we'd like to think not. Years ago, I knew PMs who would have a standby list of folks to say good things on their behalf. The folks on the list were real and did have accounts with the PMs, but they were often family friends who were trying to help the PM regardless of performance.
Lastly, avoid anyone -- and I mean anyone -- who never appears to have a losing trade nor discusses a losing trade. I've learned more each year from my losers than I could in 10 years from my winners.
I hope everyone has a safe and merry Christmas and enjoys a long weekend away from this craziness we call a market.