BawldGuy Note: Max has been a little under the weather this week, which is why this update is being posted now, instead of yesterday. Be well, Max.
2-12-10
CURRENT BUY – 100% of stock allocation $$$
KEYLINE 7-25-09 BUY 50% allocation only (S&P @ 970)
SIGNAL 10-9-09 BUY balance of 50% (S&P @ 1071)
1-25-10 SPECIAL INSTRUCTIONS ALL SUBSCRIBERS:
Establish stops on volatile stocks 12% below highest high last six months.
Use 25% stop for “Steady Eddie” stocks. Check each day to see if any close
below stop. If so, execute that exit the next day, at the open. These
instructions hold until we close above S&P 1160 (if we do).
Can’t believe another week has whizzed by, but here we are mid-February! I guess the best news is that we did finish above the S&P Keyline today and that is a close that counts a whole lot!! But, we are not out of the woods by a long shot, at this point. The next hurdle, if we can stay above the Keyline, is to get to some point over S&P 1100 on a Friday close. Will we? Hard to tell, but on Monday I will have a very thorough look at the S&P and detail an interesting formation that is there. Is it bullish? Well, aspects of it are, but the bears have left their imprint, too. More on that come Monday’s Weekly Keyline Report.
CRUDE AND COPPER CHARTS
This is Friday and today, in addition to short comments on the S&P and bonds, I include a rundown of the Copper and Crude Oil charts. So, let’s get to it.
I had added a support line to the chart last week and have added a resistance line this week. These give you a very graphic picture of what investors are doing. Since last September, the Crude market has been like most of us, uncertain. The best thing to do in such circumstances is to be a buyer when you think it is a good buy and a seller when it appears that some of the profit you have might evaporate. In this instance, the bulls and bears have gone back and forth for five months now. The $83.50 resistance, where they sell, is quite clear, as is the $71.50 level, where they buy.
But, as in every trading range, a break out will occur. When? Wish I knew exactly when. I’d bet the farm and make a bundle. What I do know is that typically such tight trading ranges tend to breakout somewhere between the fourth and sixth move up and down. In this instance, we hit the top resistance in September (see black circles), the bottom in December, the top again last month and the bottom, number four, last week. I would begin to look for the breakout, soon. I have no clear idea if it will be up or down at this point, though I do see a weaker black line (slow sto) in the MOMENTUM SECTION. I would be watching the weaker side here, closely. But, again, no for sure move is clearly apparent just yet.
We have, for two weeks tried to break up through the 3.1000 resistance level, but failed. It is not significant yet, but the longer we do not cross up this level clearly at the end of the week, the more likely that we might see more selling. Way too early to call that, but as the black line (slow sto) in the MOMENTUM SECTION moves lower and lower, the less likely that the rally will stay intact. But, do note how low the green line (fast sto) is today, at 28. That tells us the possibility is still there for the rally to continue, but if the black line (slow sto) gets much lower, …well, let’s just see. All-in-all, do not forget that we are still in the hyper rally mode (above both the Keyline and the Cap line) with both lines at just about the same 2.7000 level. Need more time here to call a direction.
THE BOTTOM LINE
Bonds were falling the last part of this week, as three bond auctions all were very tentatively received. We are still above the Keyline, but clearly the Big Bond Guys are worried. My sense of the chart, which will be in the Weekly Keyline Report on Monday, says more weakness next week is quite possible. And barring any collapse of the Greek bond and currency market, I suspect that Keyline will be challenged again. I will have much more on this Monday.
The other charts, Gold, Dollar and NASDAQ all are still holding their own, especially Crude staying above its Keyline. That is the most interesting one, at the moment. Gold needs to cross above its $1,125 level to resume its rally, but if the Dollar keeps climbing that will likely be awhile in coming.
Bottom line was that it was a significant week in that we held above the S&P Keyline. Next week will be most significant, as I see this battle in the S&P possibly coming to a head in the next 5-10 trading sessions. Could be a significant week.
So, again as I said yesterday, keep the powder dry, the eyes peeled on the stops, and a supply of possible Buys fresh in the hopper. And as ever, do hope your trading day was profitable and will see you Monday, Lord willin’ and the creek don’t rise.
NEED SOMETHING TO TALK ABOUT TONIGHT?
SIX STORIES IMPACTING THE MARKET TODAY
1. Obama invites GOP into his lair to have a national TV meeting. Will they fall for it? You’re kidding.
2. Europe problems are still a front burner issue and investors are plenty worried. They should be!!
3. Reid guts Jobs bill, then blames the GOP. Is this guy from some other planet? Come on!
4. Retail Sales rose in January, but biggest component was the electronic use of food stamps. Ugh!
5. Miss this? India reports mfg. output grew nearly 17% in December!! Whoa!! Was 16 yr high!
6. China moved again today to slow bank lending. What do they know we don’t?? Bet it’s not good.
MY TAKE: #6 tells me that China has not been totally forthcoming in their economic reports. All that growth they tout may be a false view, as it only included govt. sponsored building of manufacturing capacity -– which is not growth, just make-work. Hummmmm. #1 will be front page, soon. Could be a showdown that changes the election next November, even more. #4 is a sad commentary on consumer pullback from the market place. Several more months will tell that story. And #5? Well, I was surprised. Are you??
Note: All closes at 4pm using continuous cash contract results
Disclaimer
** The top five sector stocks shown are stocks that are above their Super Chart Keyline and between $5 and $35 in price have been randomly selected from the stocks in the each sector. Their inclusion in the Report is not to be interpreted as a buy recommendation nor is the exclusion of others above their Super Chart Keyline to be interpreted as a sell recommendation. This data is given for informational and research purposes only, as we do not make buy or sell recommendations at any time under any circumstances.
?***Max Whitmore, “The Keyline Report”, and “MUNCHIN’ On the Number”report does not endorse or suggest any of the securities which are mentioned in any way in its Reports. They are provided purely for informational and research purposes only. Max Whitmore, “The Keyline Report,” and “MUNCHIN’ On the Number” do not recommend particular securities to anyone, ever, under any circumstances. The statements made herein include information obtained from sources we believe to be reliable, but no independent verification has been made and we do not guarantee its accuracy or completeness in any manner whatsoever. You should not make any investment decisions of any sort based solely on what you read in the Keyline or MUNCHIN’ Reports. The statements made herein contain general information and do not constitute an offer to buy or sell any security of any description. Subscription to any of the Reports mentioned above is consent by the subscriber of full release of Max Whitmore and the Reports mentioned herein from any claims or actions of any description, legal or otherwise, against Max Whitmore or the Reports. All material herein is Copyright 2010 by Max Whitmore. All rights reserved.
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