Chris Johnson

Don't Buy Into the Retail Hype

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Free Trading Guides

We have been hit with a nonstop barrage of stories about the lousy holiday shopping season.

Every night for the past few weeks, the major TV networks ran stories with some reporter standing in a half-full store parking lot on Main Street, USA, or at the fountain in the middle of a mall talking to a shopper who just bagged an 80%-off sale item.

The message was clear: Sales were down. Discounts were up.

The traditional late-December sales were introduced before the Thanksgiving leftovers had even been digested. And even those who were brave enough to fight the (albeit smaller) crowds were taking home fewer shopping bags.

I think we get it by now.

But, surprisingly, the market didn't.

Sales might have been in the tank, but the market kept wearing its rose-colored glasses as far as keeping retail stocks afloat. Basically, Wall Street was waiting for Santa Claus to show up.

Anyone want to volunteer to tell Wall Street that the Tooth Fairy isn't real, either?

Something to Believe In … and Profit From

Although there is money to be made on any day the stock market is open, my favorite way to trade is around events.

I don't mean Wall Street-induced occurrences that may or may not occur, like the Santa rally the pundits predicted that never managed to materialize this year (or, for that matter, last year).

No, I look forward to bona fide, mark-it-on-your-calendar, you-can-set-your-watch-by-it extravaganzas like quarterly earnings seasons.

Although companies report their gains and losses all year 'round, the bulk are concentrated four times during the calendar year. And if you're looking to play the next one for profits, you're just in time!