Positive Earning and all to important Approvals...

I will first start off with Orexigen (OREX). The did not get the coveted FDA Board approval for Contrave, their weight loss drug. I was watching closely as many people made calculated bets on which way this all too important approval would go. I think the best write up was from an article on Seeking Alpha which outlines the cases for this drug to not get approved right away. It outlined points from the 2010 panel, not board, meeting which outlined that many doctors on the panel and board are concerned about the elevated readings blood pressure in people that were part of the phase III testing. Glad I read that article because I almost pulled the trigger. Oddly enough I think their may be an opportunity now that the stock was slammed by over 72% to the downside after the closing bell. It was from roughly $9 to a 52 week low of $2.47. If you've got ice in your veins because of the blizzard. Nibble here on Orexigen because again there is an all to important thesis out there about this stock. It was known in the FDA panel review that they already thought more monitoring of patients would need to be done based on patient data. This along with the comments from panel members should have been taken into consideration as the FDA was not looked in a favorable light due to the last approved diet drug that had to be pulled from the market. There is clearly a high hurdle rate that must be met for diet drugs. But at these levels for a drug that made it through Phase III with fairly good efficacy tests should be looked at closely.

Baidu (BIDU) - I've been watching this stock and the earnings were better than expected. Now is way above where I want to acquire but remember this is the Google of China, and there is serious value to be had.

Radisys (RSYS) - Finally, they reported better than expected earnings. We will need more quarters of this for the stock to keep rising.

Short Interest Rises

I love how some leaders and analysts love to say that we are not in a recession. They often want the market to meet very strict criteria before they officially define it as a recession. However, many of us don't need a definition to tell us how bad things feel. The thing I tell people is if you don't like it set yourself up to fight back. The way to fight back is to make sure that you can profit when the market is up and also more importantly when the market is also down.

We have discussed a number of times that shorting stocks is not easy because I think it goes against peoples natural instinct. I find it very hard to root or bet for something to go down. But again you have to be very disciplined as an investor and take your emotions out of it. You have rarely seen me recommend shorting stock but I think this is a strategy that is too important to miss out on.

I found this article this weekend and even traded emails on a few of the stocks mentioned in the article with other investors as recently as this morning. I want you to look at one of my favorite stock research websites, Seeking Alpha, and examine the following stocks mentioned in this article: http://seekingalpha.com/article/84613-nyse-short-interest-hits-record-highs-again?source=wl_sidebar

My goal is to keep this short so here is how to get better at shorting stocks.

~ Follow the market and recognize when every is feeling bad about stocks

~ Trade on information that acts as a catalyst. The article above or the approach I took when I shorted Zhone Technologies on bad news are examples of catalysts that could trigger selling

~ Set limits and walk away with positive gains.

Now I hate reading something and not acting on it right away but who knows one day I may grow some balls. I have been vocal that I think the financials suck and if you would have SHORTED the financials on this list as of today you would have seen the following percentage declines:

ZION -23.20%

WM -34.75%

MBI 2.31% This would have been the only stock to lose you money today.

ETFC -9.56%

FHN -24.78%

AVB -3.53%

NCC -14.71%

MTG -5.30%

HBAN -17.20%

I will wrap up by saying keep it simple, follow the money and use important indicators like what we found here to assist you no matter what direction the market is in. REMEMBER, you are betting stops will drop so these negative signs are your friend. I'm out! And even though I didn't get to buy these guys all today my previous recommendations on shorting Financials through ETF's SKF and SEF have come through in a big way.

Best Performing Stocks

Patience is something that cannot be taught. And as I have evaluated some of the best performing stocks of this year so far, I am pleased to note that one of our recommendations comes in on all the lists with big returns this year. It is Clayton Williams Energy Inc (CWEI). This stock has been with us so long that if patience is your weakness it would have been exposed. If you gave up on this stock that was in a sector we have constantly talked about week after week you would have taken part in these great gains. Need more proof check out these:

Urbanomics post on Clayton Williams, and other energy plays...notice the date of the article and the message from 2 years ago to stick with Energy stocks, Clayton Williams and Weatherford, and Chesapeake Energy.

http://urbanomics.blogspot.com/2006/04/portfolio-alert-ballin-of-wall-street.html
http://urbanomics.blogspot.com/2006/01/stock-update.html

Motley Fool's take on this year's top stocks:
http://www.fool.com/investing/small-cap/2008/04/17/the-years-top-stock.aspx

Seeking Alpha's write-up on top stocks:
http://seekingalpha.com/article/75107-another-month-of-08-in-the-books

I like to note that a few of my friends are making great recommendations at this point and one of their stocks is actually topping the list. This stock is Finish Line (FINL) and what I love about this stock is that we were 100% on the money with our analysis. Now I did not buy into this stock but my recommendation was to wait for the legal proceedings from the Genesco trail to end and look to accumulate this stock in the event that the judge allows Finish Line to walk away from its original deal to acquire Genesco. I didn't like the potential acquisition and it looks like the street agreed with me. Also I would like to point out that another one of my friends has been enjoying an incredicble ride with the credit card network processors Mastercard (MA) and Visa (V). Again, I do not own shares here but I think these are great plays due to the fact that the networks don't have exposure to customers with deteriorating credit concerns like the big credit card issuers do (Bank of America, Capital One, Citigroup)...they just run the transactions back and forth.