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Wednesday, September 30, 2009

Wednesday New Highs

176 new highs today, the list is here.



The high volume advancers from the relative strength list.



The high volume decliners.

I have DMND scheduled to report this afternoon, but I haven't had time to see if they did. I will check again in the morning.

Quarter 3 In The Can

You have to hand it to Cramer, his timing was impeccable. I wish I could have sympathy for those who rushed in ion his recommendation, but they should have learned by now. What I don't get is, who the hell was buying today? This could well be bankrupt tomorrow.

Here is the last quarter. So much for "window dressing", today did not reflet much of it. September is supposed to be the worst month for stocks, but this September did not play along. However, it is going out on a sour note, with two more distribution days, and a major failure to take advantage of a mid day rally. Right at an hour before the close, the financials started dropping like a stone, while both oil and gold held up. It was probably the CIT news. We did, howver, bounce off the 20dma again, and the bears are having one hell of a time getting this below 1040.

The Nasdaq also picked up a distribution day, and is holding support at about 2120. This has been performing on a par with the SPX recently, so it's hard to tell if it is weaakening or just pausing for another burst of strength.

The Russell 2000 is weakening, but still has support at the 20dma. 590-600 is going to be critical to hold for the bulls, and very tough to get through for the bears.

Crude oil went just about nowhere this quarter. Despite a fairly wide range, it closed the quarter just about where it started. Demand for oil would be expected to rise in an economic recovery, and it just hasn't happened.

October is going to be very interesting, as earnings season begins with a market that is expecting big growth. If we get it, we may not get that big a rise, but if we don't, watch out below. I'll be watching Treasury auctions next month as well, because the Fed's QE is supposed to end, and that could be trouble. I think the liquidity driven "sugar high" the market has experienced is about over. Now the question is, do we have a collapse, or a slow grind down?

I'm not sure I will have time to have a new highs update tonight.

JBL


JBL has been in a relentless untrend since July and really hasn't given any good entry points. It broke out on earnings today, on the highest volume in 6 months, but is awfully extended here and is a little risky here. It may continiue to go up from here, but the probabilities aren't very high.

MVIS


MVIS has had a nice run-up the last few months, but has just gotten over the $5 hurdle, so it wasn't on my radar. It has had a remarkable increase in volume recently, and broke out of a short flat base. It is very extended here, being more than double the 200dma, and may be due to form a longer base.

CTCH

CTSH is a low price thinly traded stock, so it doesn't get a lot of attention and the chart pattern is a little diffiult to interpret, but it is slowly increasing in volume and has increased price dramatically since July. The recent move is off news rather than earnings, so I would not be too quick to jump in.

Earnings Spreadsheet Update

The new earnings spreadsheet is now updated and uploaded. As usual, page two has had the last 4 quarters of earnings for each stock color coded. Page 3's data is current as of last Friday.

Options Data

Here is today's unusual options activity, from whatstrading.com.

Dollar Reversal


The inverse relationship of the dollar index and the SPX continues, as we had a reversal in the dollar at 10 am (highlighted) which resulted in an equities rally.

CIT Comes Up Snake Eyes

CIT, a stock that has been "rescued" several times recently, is on the edge of bankruptcy again, literally hours after Cramer recommended it and it ramped up. It is now down 40% and
dropping fast. The dice finally came up "snake eyes". The next "other shoe" is about to drop.

Besides CIT, we have 3 economics reports to digest: ADP employment - bad, Chicago PMI - bad, and GDP - less bad (the new good). The market actually stalled around for about 10 minutes after opening before the selling really got going, and we tore through 1060 and 1050 pretty esaily. There are so many potential pivot points in the last 10 days it's hard to figure out which one is going to be most significant, but there is no doubt about the low at 1041; break that and it's bombs away. Technically this is a very significant pattern as we failed to reach the high at 1080 on the bounce, which is the short signal from hell. Getting smacked around are XLE, XLI, and XLY, with XLK, XLP, and XLU "leading", down less than 1%.

Despite the carnage, there are 87 new highs so far, but with no decent breakouts. MU and JBL, bith from the relative strength list, reported last night, with MU down 1.9%, JBL up 7.6%. After the close today we have DMND from the earnings list.

Tuesday, September 29, 2009

Tuesday New Highs

There were 195 new highs today, the list is here.



These are the high volume advancers from the relative strength list.



And the high volume decliners.


Reporting after the close was MU, down 1% after hours, and JBL, up 7.5%.

Bounce Back Stalls

It looked like it was going to be another positive day, but apparently the consumer confidence numbers didn't please the market, as we were right at the pivot at 1070 when the numbers came out, and went into a prompt tailspin. However, support at 1060 held, so we spent the day grinding around in the 1060-1070 area. Volume increased, and I believe today's drop was just enough to qualify as a distribution day. I noticed a pattern broken here; since July, after every substantial pullback we have had at least 4 straigh up days. After this last one, we only had one. Is that significant? So far, not really, but unless we get back above 1080, we could be seeing a correction in the making here.


the Nasdaq lagged today, a good indication of a potential down day. This is overall stronger than the SPX, but is weakening. Today should also count as a distribution day here.

The Dow industrials also lagged today, a very unusual occurence. Volume was low, so this avoided a distribution day, but this looks far more likely to break support than any of the others.


The Russell 200o also tested support, and passed. Now lets see if it can get above resistance.

Here is Bernanke's headache. Rising yield on the 10 year should rally the equities market, but will also kill any chance of reviving the housing market. He also needs buyers for the new debt coming on the market, and what is the best way to do that? Cause equities to drop. Of course, it they do, the "green shoots" are going to turn brown fast. The TNX is sitting right above support, and the momentum has shifted down.

The new highs update will be slightly later than usual tonight.

WAG


WAG gapped up huge on earnings, uncaharacteristic for a more defensive stock like this. not surprisingly, holders took this as a rare opportunity to take a nice profit. This was one of the leaders of the March rally in the early stages, but you can see how seriously it has under performed the market since then. This, to me, is another sign of the topping process in action, but then I've been seeing that for quite a while.

WNS

WNS got a big boost in volume on no news, although this is pretty thinly traded so it doesn't take much to constitute a "big boost". It's got a nice pattern, but could not close above the resistance at 16.

MJN

MJN is a recent IPO that was hit with a rumor this morning that it was a buy out target. I don't know the source of the rumor, but it was CNBC that quashed it (after Cramer shorted it). Oops, I didn't say that.

ASTC

ASTC gapped up on earnings, but also announced they are pursuing "strategic alternatives", meaning "we need somebody to buy us out". That lead to a gap up, followed by lotto fever.

Earnings List Additions

I have a finalized the next earnings list. I had about 200 possible candidates, and in order to be as objective as possible, I hid the column with the ticker symbols and went only with those with the best numbers. Now that I have float data easily available, I will restrict new members to those with less than 30 million shares floating. Any now on the list with more will be "grandfathered" in, however, they must maintain exceptional earnings performance to stay on.

The list is a bit of a surprise, as many of these were considered "crap" stocks just a few months ago. Here are the additions:

MAIL, KIRK, IVC, LHCG, LANC, DIN, CYBX, HWKN, EBS, VIT, TLVT, SCL, VASC, UNFY, OFG, MELI, RGR, POWL, CATM, ALGT, CACC, ARB, AEPI, ARST, ASEI


I am still about 3 weeks behinds on this quarter's (now ending) earnings reports, so some that reported good earnings this quarter may not show up for another 3 months. The spreadsheet should be updated and uploaded by tomorrow night.

Options Data

Today's unusual options activity, from whatstrading.com

Thomas Jefferson On Central Banks

"If the American people ever allow private banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all their property until their children will wake up homeless on the continent their fathers conquered." - Thomas Jefferson


With this morning's news that the Federal Reserve is the mortgage market, how long will it be before they own all the real estate in the USA?

Breakout Candidates


Here are four stocks alerted by clearstation's "breakout" screen. Of the four, I think WSM is the better opportunity.

Tuesday Morning Update


Here is the last 10 days of the SPX. Yesterday's volume was incredibly low compared to the size of the move. One thing that may be happening is that short sellers, having been burned too many times in the last few months, now have a hair trigger on the "buy to cover" button, and are prepared to take razor thin profits. I moved the lines a bit, putting support at 1060, resistance at 1080 and the pivot at 1070. So far we have stayed in the bottom half of that range, I'm watching for repeated failures to break above 1070 as another potential short signal. XLP is the leading sector tis morning, XLE the laggard. I had both oil and gold down this morning, but gold has reversed and XAU is up pretty big. Economic reports released this morning were Case Schiller Home price index, down 13.3% but apparently better than expected, and consumer condidence, worse than expected.

Here is the bad news of the day: The Federal Reserve is not supporting the mortage market, it is the mortgage market. I quoted Thomas Jefferson in a past post (which I will have to find) where he basically said if we have a central bank, they will eventually own everything.

There are 142 new highs so far, with no charts that look especially good right now. WAG gapped up big on earnings, but is a stock that does not have a history of big gap ups, and is getting severely sold off. MU is on the relative strength list and is scheduled to report today, but a time has not been supplied. I had MTRX scheduled but can find nothing on it, but it is coming off the earnings list so I won't bother with it anymore. JBL is scheduled to report after the close. I also had DMND reporting today, but it is reporting after the close tomorrow. Apparently when I made the earnings schedule I confused dates and days. Too much caffiene, probably.

Monday, September 28, 2009

Monday New Highs

There were 162 new highs today, the spreadsheet is here.



Today's high volume advancers from the relative strength list.



The high volume decliners. I guess I wasn't kidding when I said there was no selling.

I had MU reporting today, but now it is scheduled to report tomorrow, but I do not know the time. I also had MTRX scheduled, but there is no news on it. I had JBL reporting after the close, but that will report tomorrow after the close. Apparently I had dates confused, so look for these tomorrow.

Low Buying: No Selling


After a near perfect bounce off support and the 20dma, you have to wonder why volume was so incredibly low today, and just who it is doing the buying. RSI has been strengthening sinc the july low, but after peaking in early August CMF has been in decline. I suppose the computers could be passing the same shares back and forth, but it's hard to believe they could sustain it this long. Of course, volume could be revised later, but still, it's quite shocvking to see such a big move on such low volume.

The Nasdaq almost made it back to support, but not quite. If this was a stock, today would have been a good entry point had it not been for low volume.

The Dow industrials also bounce off support as they have resumed their lagging. Volume has been low here for months, so today doesn't look that bad.

The Russell 2000, also bouncing off the 20dma. This looks like it might head for my "target" at 666.

The market jumped early on dollar weakness. However, the dollar reversed, gaining strength (and crushing oil), and did provoke some market weakness except in financials. Flip this upside down, and it's almost a perfect image of the SPX.

A pretty strange day, as the dip buyers came in in the morning, but there weren't many of them and there was basically no selling. I suspect the big money boys are expecting another move up, and TPTB seem to be ready to accomodate them.

I will have the new highs update shortly.

GMCR

GMCR formed a sort of cup and handle pattern, although the handle is really too short. I'm not sure if there was a catalyst for this move, but this has had high short interest and it could be another attempted squeeze. The price relative line is very weak, and that along with the short handle may indicate a probable failure.

RINO

RINO came absolutely out of nowhere, and is now an IBD 100 stock. Volume has increased dramatically, but is still low enough that it can go a lot higher. Unfortunately it is now about 3 times the 200dma, and extremely risky place to enter.

RODM


I don't know much about this one, but it's been getting a humongous boost in volume in the last month and has made a huge move. It broke out of a very short base today on highest volume yet, and is getting to the point where it is really a lotto play.

Options Data

Today's unusual options activity, from whatstrading.com.

GMCR


GMCR is one of the IBD leadership type stocks since it first broke out back in May, and has been (for reasons I can't fathom) a popular target for short sellers, leading to many squeezes. It has formed a cup and handle pattern, the high point of the handle being 71.43. The handle is only 4 days long, which O'Neil says is too short and prone to failure. It started moving Friday on a small increase in voume, then got a blast of volume at the open this morning, for no reason I can find. It is pulling back a bit and may offer a decent entry point somewhere areound 73, with a stop somehere just below 65.

CSC

There are 3 acquisitions that I know of this morning, ASPM, GETI, and ACS. ACS is a computer related company being bought by XRX. CSC is also a computer related stock making a move on pretty good volume, and is on whatstrading.com's list of unusual call activity. It may be an acquisition target.



Here are the numbers on CSC from Finviz. Good, but not great. There are 150 million shares in the float, so it will take a lot of volume to move this. If it is acquired, it will get it.

Monday Morning Update

Friday's failure to break 1038 set up a bounce, which we got this morning. 1058 will be today's pivot point, and as I am writing the SPX is sitting right on it. The only question is where do we fail, here or 1068 (that is, unless Bernanke pulls the rug out from under the dollar). Strength is in XLK, XLI, and XLB, weakness in XLP and XLE. Both the Nasdaq and Russell 2000 are leading big, so today is shaping up as a bullish day. Gold and oil are both getting bounces here.

There are 81 new highs so far, with several high volume moves that look like acquisitions, I haven't had the chance to check on them. GMCR is the only one that looks like a real breakout, and is worth checking out. I had 2 stocks scheduled to report this morning, MU and MTRX, but apparently neither has yet. I also have JBL scheduled to report after the close today.

Sunday, September 27, 2009

Earnings Schedule This Week

Here is the earnings schedule for this week, two from the relative strength list and two from the earnings list. I believe MTRX is one that I have coming off the earnings list, but i will be tracking it anyway, and a n incredibly good report could change that.

Revised Relative Strength

After several screwups that ate up a lot of time, I finally got the second screen done. As you can see, changing the criteria for the relative strength scan from 25% to 15% of the 52 week high-low range made quite a difference this week. The first column are the ticker symbols that would have been removed, the second column the symbols that would have been added. At this point I still think it's better to emphasize increasing volume over price reange, but until I run some back testing, I don't know for sure.

"Say Hello To My Little Friend"

From Bloomberg:

Sept. 27 (Bloomberg) -- World Bank President Robert Zoellick said the U.S. shouldn’t take for granted the dollar’s status as the world’s main reserve currency. In remarks set for delivery tomorrow, Zoellick said the “next upheaval” in the international economic order is under way as emerging nations gain greater influence. “The United States would be mistaken to take for granted the dollar’s place as the world’s predominant reserve currency,” according to excerpts of his remarks released by the World Bank. Policy makers from China to Russia repeatedly have called for an alternative to the world’s main currency in foreign- exchange reserves.


Obama's response? "Say hello to my little friend".


More Bond Capers

Well, well, it seems another 100 billion dollars in U.S. Bonds has been siezed at the Italian border with Switzerland on Sept 18, 3 months after $134 billion worth were siezed last June. Again, details are sketchy, but the M.O. here sounds eerily similar to the previous smuggling attempt.
With two major catches in the span of 3 months, it begs the question, how many are getting through? And where are they going?

Relative Strength Update

Just a housekeeping note: the relative strength spreadsheet is now updated and uploaded. I did not get a chnace to run another scan yesterday (using 15% rather than 25% as the cutoff) but if I get a chance to do it today I will publish the results tonight.

Relative Strength By Industry

Here are the top 20 industries by percentage of stocks with relative strength (in the top 25% of the 52 week high low range). This is a project that is just getting off the ground. I have several months worth of data, and once I settle on a method I can go through past dat and form a new database which will look for trends. This week I took all stocks from the relative strength scans except acquisitions (since they are at or near highs because of external factors not related to fundamental or technical strength), and stock not in the Finviz database (I'm using the industry groups from Finviz for this, as it is faster. I also have industry groups from Zacks and IBD, but they will be a huge pain in the neck to try to use here).

Wall Street's Next Target






Ron Paul apparently has a squeaky clean past, but Spitzer was dumb enough to walk into a trap. Let's hope there's nothing in Grayson's past (or present, for that matter) that will give Wall Street ammo to destroy him.

Saturday, September 26, 2009

Relative Strength Performance

Here are the top 20 one week performers from last week's realtive strength list.

Here are the bottom 20.

Earnings Summary

There were two stocks from the earnings list reporting last week:

SNX- reporting a quarter of decelerating growth
AZZ- reporting a quarter of negative growth

I am in the process of the quarterly update on the earnings spreadsheet and will not be updating the sheet this weekend. I have decided on the removals, and it is a bloodbath. Most were removes for negative earnings growth, a couple were removed for float too big, and a couple of AMEX stocks were removed because I got tired of having to dig for hours for information on them. They are:

ARD, ARTW, ASGN, ATPG, AVAV, CLB, CSGP, CWEI, DMLP, DWSN, DXPE, ENS, EXM, FRD,
GBR, GHM, GSIT, GTLS, HCKT, HOS, IDSA, IGTE, ISH, KTII, LNN, MTRX, MXC, NGS, NSYS,
PDO, PHX, PQ, RBN, SDTH, SNAK, TAYD, TNH, VSNT, WHG, ZEUS.

They say you learn the most from yoour mistakes, and if that is the case, I think I've learned a lot from the excercise. For one, O'Neil emphasizes not only high growth in the near term, but also consistent growth in the recent past (5 years). I was caught up by a lot of high growth "flash in the pan" stocks, especially energy stocks whose earnings ramped up with the price of oil. From now on, I will give more emphasis to past earnings growth as well as current.

I have not decided on additions yet, but there may not be very many. I plan to have the update complete by October 1, the start of the next quarter.

Relative Strength Scans




Here are the results of this week's relative strength scan. There were about 1800 stocks in the top 25% of the 52 week high-low range. As I did last week, I will run anther scan using the top 15% of the range and compare results.

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