Doug Kass fills his blog on RealMoney every day with his up-to-the-minute reactions to what's happening in the market and his legendary ahead-of-the-crowd ideas. This week he blogged on:

  • How it's full speed ahead and damn the fundamentals.
  • How the middle of the earnings season means big moves for individual names.

Click here for information on RealMoney, where you can see all the blogs, including Doug Kass'--and reader comments--in real time.


 
Damn the Fundamentals, Full Speed Ahead
 
Originally published Feb. 10 at 9:19 a.m. EDT
 
I had a great question from Neil S. in the comments section and I just wanted to expand on his question and comment, because I believe what we discussed is so important right now.

I've seen a lot of traders come and go. Usually, they go when they fail to adapt. Believe it or not, I knew people who couldn't handle the change from fractions to decimals, which happened over 15 years ago. I've seen many similar situations over the years.

I'm a technical trader, but I also try to respect the fundamentals. However, the level of attention that I'm willing to give fundamentals can change depending on the environment. Fundamentals didn't matter in 1999, when the Nasdaq climbed more than 80%. They mattered a heck of a lot more in March 2000, when stocks crashed.

I've covered most of my shorts. Many of those shorts were initiated when the market was drifting sideways, as it did for a good chunk of the past year. At the time, it made sense to play the market from both sides because it had no clear direction.

Now the direction is clear, and I've adjusted. It's no fun taking a loss on a stock such as Chipotle Mexican Grill (CMG - Get Report) , which I shorted at $385 and covered at $415, but I'm not going to exercise the same level of patience with shorts in a roaring bull market as I would in a weaker environment.

Nvidia (NVDA - Get Report) is a great example of the current "damn the fundamentals, full speed ahead" market environment. The stock trades at 76x trailing earnings and 43x forward earnings. None of that matters right now because traders are simply buying every dip that Nvidia can muster.

That's not a knock on this stock, or any stock. As traders, it's our job to adjust to whatever environment the market presents.

This is a bull market, the S&P 500 is trading at all-time highs, and corporate taxes are likely to be slashed in the near future. If the market (or an individual stock) wants to go higher, why fight it?

Position: None.

 
Morning Movers and Shakers
 
Originally published Feb. 10 at 8:35 a.m. EDT

We're in the middle of earnings season, and that means big moves for individual names. All the following companies are on the move prior to today's opening bell:

Nvidia (NVDA - Get Report) is the big story today after reporting strong earnings after the close. The stock, which has quadrupled in price over the past 12 months, initially traded lower, but has fought its way back above $119 in pre-market trading.

Gaming stock Activision Blizzard (ATVI - Get Report) is trading sharply higher--up more than 10% in pre-market action--after a solid earnings report. The company also increased its dividend and announced a share buyback plan. The stock is trading just shy of $40.

Yelp (YELP - Get Report) is getting rocked in pre-market trading, falling nearly 10%, to $37.40. Yelp's earnings were above expectations, but the company lowered revenue guidance for the full year.

Biotech stock Intercept Pharamecuticals (ICPT - Get Report) has had a huge swing this morning, at one point down nearly 13% in pre-market action but now up around 11%. Investors are expecting an announcement from the company later this morning.

Music provider Pandora Media (P) fell slightly after lowering guidance for the current quarter. The stock dipped to $12.40 in late trading.

Finally, Zynga (ZNGA - Get Report) fell about 5% after a disappointing earnings report. The social media gaming stock is trading near $2.40.

Position: None.

Action Alerts PLUS, which Cramer co-manages as a charitable trust, has no positions in the stocks mentioned.