Tomorrow's Gameplan

Make no mistake that this market is OB, but guess what? It doesn't matter. With Europe looking "solved" (yeah right), and earnings season kicking off with a Google-sized bang, the bulls are in control. This rally could go another week, but when we're OB like this my research tends to lead me more towards finding good stocks to short, not buy. I may snag some Apple (AAPL) and Qualcomm (QCOM) to play Wednesday's earnings report but only if I see a good entry. Also, one of my screens shows that Nabors Industries (NBR) and CVR Energy (CVI) have historically run on avg 8%-9% from where they closed Friday, over 95% of the time! Not bad odds right? I'll be picking some up early in the AM. But on the short side, another one of my screens turned up three names that historically have fallen, on avg, at least 5% over 70% of the time they became OB. It's not time to short since they're not quite OB yet, but I'll be watching Rio Tinto (RIO), DineEquity (DIN) and Rubicon (RBCN) very closely. Harbin Electric (HRBN) is already flashing "Tech OB" so I shorted some on Friday. Last time Harbin Electric (HRBN) registered "Tech OB" in my screen it fell over 12%. Chinese stocks are getting killed anyway recently so if the market turns, this one could test it's 200d MA. Harbin Electric (HRBN) closed at $22.09 on Friday and it's 200 day MA is $18.10.

This is not a recommendation to buy or sell any securities. DAK was long AAPL and short HRBN at time of publication but positions can change at anytime.