1-15-10
BawldNote: Sorry for delay. Sometimes schedules don’t sync.
CURRENT BUY – 100% of portfolio stock allocation $$$
KEYLINE 7-25-09 BUY 50% allocation only (S&P @ 970)
SIGNAL 10-9-09 BUY balance of 50% (S&P @ 1071)
STOCKS & BONDS TODAY
So, the reports controlled the whole day today. Right from the open the PPI and NY Manufacturing Index reports seemed to get a negative result, even though the PPI was well within expectations and the NY Mfg. Index came in well ABOVE expectations. Then, 45 minutes later the Capacity Utilization and Ind. Production numbers hit and again were well within expectations.
But, the undercurrent was not right. Somehow, at least to this analyst, the coming results (expected 30 minutes AFTER the open) had leaked. They would deny that, of course, but the fact is clear that the selloff was NOT a response to the PPI or any of the other numbers. It was the Sentiment numbers that came in lower than expected, but 30 minutes AFTER the opening 9:30 bell. But, once the numbers were released, the rest of the market piled on and the Dow fell to a nearly minus 150 points. The rest of the day we went nowhere. For the day, the Dow was down minus 100 points and the S&P over 12 points.
Chart wise, the S&P still closed on the Headline, not below it for the week, and the Dow remained well above its lower support area in the 10,250 area. We got a little relief for the MOMENTUM SECTION green line (fast sto), but not much. We will still need to see it move lower before we start up in a solid way.
As for the bonds, they actually closed ABOVE the Keyline today, the weekly result that will stay on the chart. We spent 3 weeks below the Keyline before this close. Will we hold above the Keyline? Well, my best guess is that we could, but I want to see if the slow black line (slow sto) in the MOMENTUM SECTION, which broke to 48.95, cross back above the 50 area (scale is 1-100) to have some comfort that the close above the Keyline will hold. For now, however, bonds have rallied as predicted by the Keyline Super Chart last Monday.
THE REST OF THE STORY
The Dollar seemed to like the pessimism on the street. In fact it is the only commodity, along with bonds, that we follow that gained today. This is to be expected. Bad news is good to currency traders as it indicates that the potential for eventual out of control inflation is lowered. Of course, we both know that it is only a passing mood, as traders change their minds quickly if another report goes the other way. You see, it is a never ending battle between world currencies, one hat never ends. All you have to do is to figure out which direction it’s going and go that way. Sounds simple, yes? Well, believe me it isn’t’
Gold slipped down $11.90 on the mornings mood change, but an up day for dollars is usually a down day for gold. Oil continued its move on a slippery slope (three days in a row!) and I expect that the move will continue another dollar or two before we hit some support. And then there is the NASDAQ. The news there is what you might expect. S&P and Dow down, NASDAQ down. But remember that are ALL well above their Keyline and doing just fine. We just need some digestion of the recent climb. Maybe another week or so will get buyers back into the ring. We shall see.
And of course, Dr. Copper. Also way above its Keyline, it remains the loudest announcer of inflation fears. Are the cries justified? For now, no. But Dr. Copper looks down the road 6-9 months. What he sees today is not good news. But, do remember that a lot of trading sessions lay between 6 months from now and today. Maybe Dr. Copper will be wrong. (But, it would be one of the few times, from my experience.) My analysis says we will see some inflation later and part of the stock market rally is discounting this possibility, also. But, more on that next week.
THE BOTTOM LINE
I expect that the stock market will continue to be spongier and commodities likewise for the next week to ten days. I would like to see the S&P cross up the 1150 area, but it may take some time to do that. But I sure would at least like to see the MOMENTUM SECTION green line (fast sto) get down to the 60-65 area. With the a weaker market for a brief time, the dollar should benefit with higher prices, bonds with at least a holding action and oil continuing to move lower for a few more days to maybe the $75-76 area.
So, until Monday, as always, do hope your trading day was a profitable one. Will be back on Monday – opps, Tuesday (Martin Luther Day Monday) Lord willin’ and the creek don’t rise.
NEED SOMETHING TO TALK ABOUT TONIGHT?
SIX STORIES IMPACTING THE MARKET TODAY
1. Next week’s Massachusetts election is set to be a barn burner. And somebody is going to get singed!
2. Ft. Hood army massacre report is in and shows major lack of readiness for such events. Not good.
3. You can help Haiti; call local Salvation Army or other help group to provide food, clothing, etc. DO!
4. I am amazed at how new bank fees are not even raising eyebrows! I wonder what industry is next??
5. Day’s worst news: G-20 plans to improve world economy. More Govt. planning. Yeah, we need that!
6. Go to: http://dealbook.blogs.nytimes.com/2010/01/15/risk-report-warns-on-asset-price-collapse/
MY TAKE: #6 is a scary report on a possible future world asset decline. It’s from reputable outfit, but you need to see what it says for yourself. Not enough room here to cover. #1 is the biggest blip on my radar today. Can go either way it appears. A Republican win would be devastating for Obama. He knows that and is going to MASS. this weekend. #3 is one I urge you to do. Sent $100 for clothes and blankets today. But, don’t send money, just supplies Moneyt too easily “lost.. And # 5 is just dumb. Dumb.
THE NUMBERS SECTION
DAILY CHANGES DAILY WEEKLY
Closes as of Fri. 1-15-10 CHANGE (cash) KEYLINE# ABV/BLW
DOW INDU. 10,609.65 -100.90 points 9,845.24 ABV +865.13
S&P 1,136.03 -12.43 points 1,060.16 ABV +83.30
30 YR BONDS 117 11/32 + 16/32 ticks 116 19/32 ABV +1 8/32
NASDAQ 2,287.99 – 28.75points 1990.47 ABV +326.27
GOLD $1,131.50 -11.90 $939.38 ABV +$204.02
OIL $77.97 – $1.29 $84.84 BLW -$5.58
DOLLAR INDEX 77.23 +0.46 79.65 BLW -2.88
COPPER $3.3735 -0.0345 $2.6924 ABV +.7156
DOW DAILY PRICE RANGE 148.88 points
S&P DAILY PRICE RANGE 16.5 points
NYSE ADV. 939 DECL. 2119 RATIO: 2.3 Decl for each Adv.
VIX – Volatility Ratio 17.63 DOWN -0.22
EOD BOND YIELDS 1 YR. 0.31% -.019 10 YR. 3.67% -.064 30 YR. 4.58% -.046
CURRENT KEY MARKETS PRICE SUPPORT AND RESISTANCE LEVELS
Symbol or Support Resistance Today’s ABOVE
Name Level Level Close SUPPORT
Dow Indu. 10,250 10.750 10609.65 359.65
S&P (Mar) 1,075 1,150 1136.03 61.03
NASDAQ 2,175 2,460 2287.99 112.99
Bonds (Mar) 114 16/32 117 24/32 117 11/32 2 28/32
Gold $1,075 $1,225 1131.5 $56.50
Oil $68.50 $83.75 77.97 $9.47
Dollar 75.00 83.00 77.23 2.23
Copper 3.0700 3.6750 3.3735 0.3035
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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