“The Comeback Country.”

America’s Back - Is the front cover headline from April 19th’ Newsweek.

The stock market chart below sure shows the US stock market is back. This issue of Investors411 is going to go over why stocks NOT the economy (a different story although since Obama took office we have gone from -700,000 jobs to +100,000 jobs a month) have recovered and one major point on technical analysis

LINK to bigger representation of above chart by dshort.com

CAUTION – While this two year chart (we are the blue line) does look good if you take a 10 year perspective the chart shows that stocks are in the 3rd worse bear market. The US stock crash of 1929 and the 1989 Japan stock crash the other two worse bear markets.

Why Stocks Recovered

1. The Paulson/Bernanke Bailout - You can also give credit to Bush, Obama, McCain, Geithner and every member of congress that voted for this flawed plan. We stood at the precipice of well over a dozen of the world’s largest banks, its largest insurance company all failing. This would have easily have cascaded us in panic into another Great Depression. Many many big foreign banks were also bailed out.
2. Worldwide Stimulus – Obama’s stimulus plan cut taxes @ 10%, kept state governments solvent, provided new jobs, new focus on alternative fuels, and gave tax breaks to small companies. You can argue the merits of the Obama plan vs. the other world wide stimulus plans, but combined they made a difference.
3. Low Interest Rates – Our Fed and other central banks cut interest rates dramatically and gave insolvent or near insolvent banks the money at close to 0%
4. Changed Accounting procedures - We virtually eliminated “mark to market” accounting. This allowed banks to less transparency in accounting and not to value assets at what they are worth at the present time.
5. Speed - Unlike the 1929 Great Depression and the 1989 Japanese stock crash, action was taken within a year to fix a worldwide economic problem.
6. Emerging Markets – China, India, Brazil and others never entered recession. Partly because their banks did NOT get over leveraged. Their economies kept right on growing.

This is all truly great news for Wall Street. Of course for every on Main Street this Simply Sucks

1. We’ve privatized the Gains and Socialized the Risk - Untold trillions have gone into fixing our over leveraged, unregulated markets (shadow financials that caused the crisis). The government money printing presses (later this means you pay with inflation) and tax dollars (bigger deficits) have added new burdens on Main Street.
2. We’ve done NOTHING to fix the problem. Alan Greenspan had his OMG moment in front of congress when he exclaimed he was wrong – “Free” (unregulated) market can not fix themselves.  There is something called GREED that emerges on Wall Street if you have little or no transparency and rules.  In fact, we’ve made things less transparent by removing mark to market accounting.

Technical Analysis

I love it that so many of you who have my personal email send in stocks for consideration on YOUR Stock List. Again Thanks – I will give you a short technical analysis of each stock. Two new stocks sent in over the weekend CKEC (3D theater stock,but over extended) & MSPD (chart looks great!) are worthy of consideration. One stock on YOUR list ICON “raised guidance”

One request - Almost all of you send me some stocks that  are too small to consider. These small companies are too easily manipulated by Wall Street Sharks. Please send in stocks that do over $5,000,000 a day in trades. More than that is even better. Multiply Volume X Price

Over two decades I’ve watched /owned way too many of these “thinly traded” stocks that exploded.

Here’s how they fall in an analysis of ERES – Chart shows @200,000 shares a day traded and price at $7.27 = @ $1.5 million a day.  Thats chump change to hedge funds, big investors, brokers, institutions.  Its too easy for them to “pump and dump”

Example-someone acquired 1,000,000 shares around 6 to 6.5. over time. They pumped up the stock by buying more shares as it comes close to its technical breakout point. Knowing other investors would then jump in as the stock broke out, they pump it up by buying more. ESRS goes higher and then they dump the million (plus say 50,000 to 100,00 extra shares it took to pump up the stock) ERES prices go down big time but they make a killing.

This obviously does not mean ERES is getting pumped then will be dumped. But the lower the volume & price the greater the potential for manipuation

Don’t worry if the above explanation makes your eyes glaze over. Just stay away from thinly traded companies.

AS ALWAYS DO YOUR OWN ANALYSIS BEFORE INVESTING

R. KY Senator Mitch McConnell

Blocking Financial Reform

Republicans are considering blocking even debate on financial reform. Ewanapat thinks I’d like his comment/information/link. He’s wrong I Love it. The 3rd Fed Governor publicly has come out against the “shadow” banks that are too big to fail.

There are a few sensible Republicans (Simon Johnson and his Baseline Senerio best source on this) who are bucking Republican Minority Leader Mitch McConnell (see yesterday’s Investors411) do nothing approach.

Taxes

Mama Jama has sent in a link to a site that reales 80% of major corporations evade taxes by having offshore accounts etc. How much does this cost you? $637 in MA and small business has to pay their full share.

Tea Party Flops

Only a 1500+ showed up for the supposed “huge” final day of tea party tour on April 15th (Tax Day) in DC yesterday. A few thousand more showed up in Boston the day before but NOT the newly elected  Republican Senator or the Republican running for governor. They called the Obama administration a “gagsta government.”

Remember we many demonstrations of 10,000 20,000 and even larger protesting the Iraq war and other left of center issues all over the country and there was almost no coverage. Yet even on the financial channel CNBC they are headlining the Tea Party protest this AM.  This is

The issue of deficits is real, but the media distortion of the Tea Party is real too.  We live in a world created by media and the thousands of past protest that get over 1500 people in DC never got the kind of coverage that the Tea Party gets. This is media bias or media manipulation.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions for changes made each weekend

US markets improved a bit on Wednesday’s significant gains in above average volume = Bullish.

Google had  earnings report = an almost 4.71% fall in post market trading = Bearish

BAC (Bank of America) seems to have had blowout earnings numbers this AM up @1.5% = Bullish

Something called a Fibonacci retracement is important in worked of technical analysis. The benchmark S&P 500 is sitting just below a critical 62% retracement from its 2008 high according to analyst on CNBC. This is a strong resistance level. = Bearish

Significant Indexes

• McClellan Oscillator fell to +8.67 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is still in NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – rose +0.36% yesterday. [Anything over +/- @0.50 is significant.] Mantra – right now The Dollar Rules Remember, dollar down almost always = stocks up. The dollar broke though its 50 Day Moving Average support level and next significant support and yesterday rose to just below resistance (Remember the 50 day MA is called its support on the way down and resistance on the way up).

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

I realize the TYH explanation will make some of your eyes glaze over because it is too technical. The best time to buy is when the McClellan is oversold and any trades now (McClellan Oscillator is neutral) is riskier.

TYH – (10%) (3X technology) Up well over 3% since bought. File under - If its not broken don’t fix it Mistake? – In the past Investors 411 sold 1/2 when TYH rose 3% and let the rest ride. Then I put a stop/sell order at what it was bought for or 3% below what it was bought for.  Bottom line here – selling 1/2 into any minor rally.

UWM – (5%) (does 2X small cap stocks) Bought yesterday at 37.57. Stop/loss set at 7% below what it was bought for

EWZ – (10%) (Brazil) Holding on

Monday’s are usually good days and some major tech companies report next week. So expect stocks to drift higher into the close.

Caution – Holding individual stocks into earnings is obviously dangerous – Even giants like INTC (+5%) or GOOG (-5%) can make huge moves. Smaller stocks even greater.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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The Illusion of Democracy

In the USA we have an Illusion of Democracy. What we really have is a rich oligarchy that buys votes through money any lobbyists. Lets use two blatant examples.

• The Billionaire ultra right wing Koch Brothers - JAB a few days ago sent a link to a site that quantified and qualified the $50 million they have spent to influence the American public’s vote. These right wing zealots with their $50 million sure have vastly more of an impact than you do with your one vote.
• Let’s look at politicians who get this money – Great site to see how much your representative (Dems or Reps) is bought and by whom is OpenSecrets.org. Today’s focus Senate minority leader Mitch McConnell.  His leading contributors are shadow financials (securities & investment) at $1,147,924. Republican leadership just met with Shadow Financial and other Wall Street leaders on financial reform. Even ultra right FOX Business news carried the story

From the Tea party workers to the leadership of the Senate (include lots of Democrats in this) the truth gets distorted by the vast financial resources and screamers in & reported on by the media.

Yes, along with JAB I still boycott Exxon, and have now added Koch Industries (Georgia Pacific -paper products) to my small protest.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions for changes made each weekend

I really try to make this stock section as simple as possible, but I certainly hear your public (see comments section) and private pleas to make it simpler.  Over weekend I’ll put together some simple rules, strategy and sources

Big volume + Big rally = Bullish Outlook

UPS – world’s biggest package mover clobbers expectations. = Bullish

Weekly jobless claims worse than expected – two weeks in a row – Bad for economy, bad for Obama politically, but neutral for markets.

Reading the Tea Leaves – Add UPS to JPM & INTC results yesterday and you get the financial and technology sectors growing over expectations. Add more packages are moving across the globe. Add the Dollar dropping and McClellan Neutral (NOT overbought)  Everything at least till the McClellan gets overbought says Bulls will continue to stampede.

Its time to buy the dip and ride this rally till we enter overbought territory on the McClellan Index.

Significant Indexes

• McClellan Oscillator rose to +19.34 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is still in NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – fell   -0.42% yesterday. [Anything over +/- @0.50 is significant.] Mantra – right now The Dollar Rules Remember, dollar down almost always = stocks up. The dollar broke though its 50 Day Moving Average support level and next significant support at @$79.5. Dollar closed at$ 80.19

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Right Now, as I read the tea leaves, it looks like the beginning (first week+) of earnings season is going to be a bullish period and it would be good to be invested in those stocks/ETF that are going to move the highest.

Example, Yesterday Investors411 added a 10% position in TYH the ETF that does 3X what the tech stocks do. Price 174.1.  Originally, had planned to hold this for a small gain (3+%) but it now looks safe to hold till the McClellan Oscillator hits or gets close to overbought territory.

Depending on your level of risk – Buy dips (1 to 3% = dip) of following ETF’s – You can also check out YOUR stock list.  but as Pail R suggests – watch out for when earnings reports ate (google company and you will find date or your trading platform should provide this)

List from MOST risky to LESS risky

• SOXL – 3x semi conductor stocks – Warning very thinly traded.
• TYH – 3X technology
• UWM – 2X small cap stocks
• ROM – 2X technology
• SSO – 2x S&P 500

I will be adding another 15%+ of these on dips.  Remember once we enter overbought territory its time to sell or lighten up. Set a stop/loss at a level you feel comfortable with. 7% maximum loss is what I use.  Once a stock goes up I usually raise the stop. There are more sophisticated ways of doing this, but I’m keeping it simple.  Investors411 will be exiting these positions as we come close to or over +60 on McClellan Oscillator.

Remember its a short term trade. It’s natural for their to be a dip today. If markets fall over 50% of yesterday’s gain in bigger volume this strategy is in trouble.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

-

Taxes Due Tomorrow -Yuck

Mama Jama has sent in some GOOD tax news (see comments section) Obama’s Recovery Act of 2009/ Part of Stimulus has given A TAX CUT of about 10% to most working class Americans. “Thank You Barak Obama”

How much did you save? Mama Jama & Paul R both saved $800. (Another $400) You can find out how much you saved at – LINK

What’s important about this is as you go though look at what is considered a deduction for this year or next year

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions for changes made each weekend

A little volume behind a very minor gain = no real signal.

Alcoa had a far less than stellar earnings report and was down only 1.58%. = Bullish

INTC, the chip giant reported last night and was up 3% in after hour trading. Another Link Anything related to Intel should move higher today = Bullish

JPM – Up about 4% after earnings this AM = Bullish

McClellan Index is neutral, so it sure looks like stocks are in for another run with the bulls

The TF&A section sure has a lot of GREEN lights.

TYH (ETF that does 3x techs) is over extended,but good short term play

Significant Indexes

• McClellan Oscillator fell  a smidge to -1.57 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – This is still the middle of NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – fell   -0.08% yesterday. [Anything over +/- @0.50 is significant.] Mantra – right now The Dollar Rules Remember, dollar down almost always = stocks up.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

YOUR STOCK LIST

up @24% since 2/11

This list has been developed by YOU sending in your stock picks, we discuss them individually (usually by email) and if they are trending positively they get included in YOUR list. Thanks to many of you who have sent in choices. If you payed attention to the List published on each Tuesday or wednesday, you’ll find a lot of winners.

Caution- This is mostly just technical analysis and lots of other factors enter into a decision to buy or sell

NB -Last Week’s comments in black. This week’s violet. Chart links underlined in Blue.

If you have trouble with terminology email me.

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

• CAAS –  China stock . Rallied, then low volume  pull back yesterday. Some risk, but buy the dip. Dipped in low volume after making a higher high – at its buy point.
• CNAM China Stock, . Again more risky, but buy the dip Dipped in lower volume, riskier than CAAS but near support and at buy point. Both above stocks tied to China.
• PCLN –  . Melting up – Buy the dip Slow melt up continued dipped 1% yesterday Would like a bigger dip.
• F –   Looks like its running out of gas – too much downside volume – wait Forming a support level along its 50 day moving average A buy the Dip
• *IMAX .  Melting up – Buy the dip – Big Dip in moderate volume, but seems to be forming support. 3D movies still #1 &#3, but overall box office slow & nothing big till May. Riskier, but a buy the Dip
• CSCO,  Heavy volume dip weak volume recovery Other tech gains AMZN & AAPL look better. Consolidating like AMZN. AAPL overextended now. These giants are the tech leaders. Slower moves than smaller stocks but safer plays. CSCO & AMZN (a bit better)
• SHOO –  Dipped and off to races again. Still buy the dip stock, but now getting riskier. Dipped last two days, but still a bit overextended
• ICON,     Now at breakout point but volume not increasing makes makes it riskier buy Winner, a little overextended – wait for dip
• DGIT –  Weak volume rally – Too risky now. Winner, broke out to new high in heavy volume. went up,down,& up again = bullish. You’d be chasing, but buy a minor dip.
• VCI . A bit heavier volume on up days at resistance again. Risky buy Consolidating and dipping toward 50 day MA/support level. Buy the Dip
• CREE – Should see another lesser jump higher after dip. Buy the Dip Winner, short dip then rallied, now a bit over extended. Chip stock should benefit from INTC earnings. A buy the dip
• SNDK –  riskier than after last rally, but buy the dip Winner, Slow melt up,INTC should benefit, buy the dip
• CTRP –  . Could go either way but volume good on up days – some risk, but A buy the dip stock Dipped in lower volume and seems to found support. Now or never buy.

New plays that have similar 3d fundamentals as IMAX. Personally I’m more comfortable with this group because I believe in the fundamentals behind 3d technology. Some fundamental analysis included. Problem with these are their sales are not pure 3d plays.

• *CNK (Cinemark)  Melt up in weak volume,(like IMAX) buy the dip – Has dipped in increased volume. No big box office shows till May. Short term in trouble.
• *RGC (Regal Entertainment) Moving higher at breakout/resistance level. Buy the dip Same as above. Better buy at end of month after dip.

32 million new heath care customers (Obama/Pelosi health care bill) means some stocks are going to rally on this increased supply and the growing aging population of baby boomers who need health care. New group

• *ESRX (Express Scripts) – Eked out a new high a day ago and dipped a little. A Buy the dip Slow melt up hopefully this is a long term hopefully
• *TEVA (Teva Pharmaceuticals)  . Seems to be consolidating, buy the dip Dipping slowly, in weaker volume, toward 50 Day MA/support. Again hopeful long term buy.

New Stocks – I’d add more but its very time consuming. Many thanks to Paul R, Monitor and some others who prefer to remain nameless for suggestions.

• VLTR Chip stock should befit from INTC. Solid long term pattern of higher highs and lows. recent dip makes for good entry point.
• UAUA (recommended by 2 of you) Great long term pattern. Over extended – right now
• SLAB (recommended by 2 of you) Classic cup and handle breakout. Even more extended – buy a bigger  dip

Analysis – The McClellan Oscillator is still near Zero so overall market upside and downside risk is equal.

• Our 3D/movie plays got spanked last week. Fundamentally, (box office) weak till May openings. Going to sell CNK in any rally today. It’s breakout has failed.
• Heath Care stocks for long term and will add if they dip to 50 day MA.
• Chip and related stocks (examples -VLTR, CREE, SNDK) should sparkle today and good buy the dip candidates.

* = Investors411 has a position in these stocks.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Tea Party Protest from TPM

The Debate

The comment section debate on the deficit is outstanding. Many excellent arguments and facts

One point you have to take to heart was made by John Sovjani – You have to get past the headlines dissing the Tea Party. There’s a huge swell of anti gov’t spending and ignoring the main message of the Tea Party is dangerous

The Tea Party for all its racism bigotry intimidation is driven by the the smaller government message.

However, the Tea Party is only the front group.  Follow the Money. The Tea Party does not exist without funding.  Who funds the Tea party – Big Business, the shadow financials, everyone who got bailed out by taxpayers. They desperately want a weaker and smaller government because that means less regulations and regulators.  They want to continue to socialize the risk and privatize the gains.

They’ve had a taste of the candy – the trillions in bailout money, no transparency, greed gone wild, monopolistic power. The only entity standing in their way is government.

People know they are getting screwed and are fuming with anger. No jobs, poor pay, deficits, etc. It’s easiest to blame or misdirect the anger to those that are in some way foreign and government. Its a classic case of misdirection.  Government does make mistakes. But government is the only entity capable of regulating big business.

Apology - Limited time this AM (9:15 EST appointment) so I’ve had to cut this edition short – Back tomorrow with YOUR Stock  List and more on deficits and health care.

The Tina Fey Video

Four of you sent me emails yesterday on the SNL  Tina Fey/Sarah Palin video.  Yes it is fall off your chair funny. Two significant points

• As a political figure running for President in 1012 most intelligent Republican’s realize Palin would be a disaster. The election would be about her rather than hate, fear mongering of Democrats, or issues. She simply does not win.
• Palin who now also works for FOX News another clear direct tie between the Tea Party movement and who is behind it. FOX (Rupert Murdoch)  and more importantly its big business advertisers.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions for changes made each weekend

The Dow reached  the 11,000 milestone yesterday. New high for year for major indexes. Once again a day where stocks go up and volume goes down.  Repeat – We should according to volume and distance from the 50 day moving average already be falling.

Earnings – Alcoa a Dow & S&P 500 stock is the first to report earnings How investors react to earning news is a critical forecasting tool. According to the report analysts expected more. So how far AA (Alcoa) dips today will give us a good idea of what the investment community eels about earning season.  If Alcoa does NOT fall that very bullish.

We’ll need a few more earnings report to get a picture of investor sentiment, but AA is the start.  Last couple o quarters things went badly for AA and the early earnings season, then picked up.

Significant Indexes

• McClellan Oscillator rose  a smidge to +3.50 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – This is still the middle of NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – fell t  -0.43% yesterday. [Anything over +/- @0.50 is significant.] A -1.03% drop in the dollar over the last two days has supported Friday’s and Monday’s move up in stocks. Mantra – right now The Dollar Rules Remember, dollar down almost always = stocks up.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

+48% Profit in TYH in 1st quarter of 2110

For more see Positions section below

Who Creates Deficits?

Chat from zFacts.com

Scott Herwehe has produced another worthy editorial in the comments section of the blog. Your comments section is an excellent source on politics, economics and markets. Suggest you check out, not only Scott’s editorial on Republican hypocrisy over the deficit, but  all other comments.

Here’s his conclusion on the deficit -

“Even the financial bailout is significantly small compared to just Bush’s tax cuts. Social spending doesn’t even compare. Our corporate controlled media will never talk about the Bush tax cuts because that would be acting against their own interests. Who benefits from a tax cut for the rich? The wealthiest among us. Who control and finance our corporate media? The wealthiest among us. The only way to get out of this recession of the real economy (not Wall Street) is to spend money in a manner that creates jobs or in other words benefits the majority and for once not the minority.”

India Ascending

Economically, India only experienced collateral damage from the 2008 meltdown. Why? – Dr. Yaga Reddy, the former head of the Bank of India, did not buy into the American concept of unregulated free markets. Bob Kuttner editorial on India, King’s College and those who withstood the breakdown of our unregulated capitalism that had to be bailed out by taxpayers.

Dem’s to Attack Wall Street?

Democrats seem eager to attack Wall Street was the headline, by Lisa Leher, on centrist web news site Politico over the weekend. Will we finally get some financial reform? If so expect Wall Street to get hurt in the short term. But in the longer term this is good for the economy of the US and world that we fix the problems that caused the 2008 meltdown.

If the Democrats follow through with this they will salvage the 2010 elections. Most Republicans will protect Wall Street. Problem is so many of the Democrats are owned by Wall Street. So much of Wall Street money will go to candidates that protect them.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions for changes made each weekend

Another up day in reduced below average volume. The major indexes are even further above their 50 day moving averages than last week. This means they are even more overbought than last week. None of the major technical factors that have historically worked as prediction tools have correctly predicted US market direction in past months. – We should according to volume and distance from the 50 day moving average already be falling.

However, our McClellan Oscillator is holding up fairly well. Still NEUTRAL and not OVERBOUGHT. Lesson here is different technical indicators or theories work better at different times

Of course, the fundamental that’s behind all this is we have failed to fix any of the root causes that caused the 2008 financial meltdown that was created by  the almost completely non regulated US “free market”) financial system.  If anything they are even less regulated today.

This is the beginning of earnings week

Fearless Forecast for Last Week - “Up week”   Another correct call

Fearless Forecast for This Week – How markets react to earnings will be key. Earnings start to trickle in this week. The dollar again (see below) rules.  The Greek crisis seems settled (see below) and this will help stocks.  

Best read of the Tea leaves – We are in an “irrational exuberance” period – The trend is higher  so predicting up week.

Significant Indexes

• McClellan Oscillator rose  to +3.26 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – This is still NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – fell a significant  -0.60% yesterday. [Anything over +/- @0.50 is significant.] There has been some settlement in Greek debt crisis so Euro should rise and dollar fall in short term. Mantra – right now The Dollar Rules Remember, dollar down = stocks up.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

+48% Profit in TYH 1st quarter of 2110

TYH is the ETF that does @3x what technology does & ROM (suggested, but not used) does 2X what technology does

Before we go over these figures and there are 2 important points.

• Caution Don’t let it go to your head. For the most part these stocks were chosen when the US markets were oversold, other reasons, plus we were lucky
• Re-read point 1

The dumbest thing you could do go out any buy TYH today.  Investors has a 0% stake in this ETF today.  Its way too far above its 50 day moving average and markets are in a neutral and not oversold condition. To see actual buys and sells link to Positions section of blog . Why TYH worked -

• A bull market
• Oversold conditions – Investors uses the McClellan Oscillator or as Monitor named it the Mickey O. The more oversold the better. Investors411 bought TYH in more or very oversold positions.
• Technology and small cap stocks generally outperform in a bull market. (Its not quite this simple)

.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Those of you who are on the private email list got the news yesterday that YOUR Stock List was up +23.7% since February 10th. (38 trading days) More below under KISS & Stocks. [If you'd like to be on this email list you can find my email under Home/Editor]

Targeted

was the headline on the major Left of Center Blog the Huffington Post & a front page story in the WaPo this AM. It referred to the threefold increase in threats to congress. This Intimidation and more was covered yesterday.

Bottom Line – The Intimidators or Bullies are winning because instead of having rational discussion of the facts behind health care, our financial system, economics, jobs, forgotten wars – all we have is the “entertainers” from FOX News encouraging intimidation because it makes money.  The left wing justifiably responding. But lost in all this is the facts and our ability to be civil to each other.

The last 2/3 of this video (Chris Matthew’s – MSNBC) deals with some of the facts rather than the shouting & threats that gets over covered on heath care. Investors411 is going to focus on some of the facts next week like the one below from Congresswomen Debbie Wassermann Schultz. (see video)(photo below from CBS)

“No one is going to force you to have health care.” – You will be treated differently on your tax form if you do not have health care – just like married/unmarried people, renters/homeowners, kids/no kids etc.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions for changes made each weekend

Another up day as volume decreases. Tired of telling you historically volume is the #1 confirmation factor behind a price move and this market is therefore acting irrationally.  However that’s the trend, and the trend is your friend.

Our #2 factor -how markets are reacting to news is bullish. Markets seem to be reacting positively to good news and negative news only slightly halts progress.

Earnings week starts next week and Mondays are usually the best day of the week. So expect some short term traders to get long today to cash in on the Monday trend.

Ed Hoffman (photo above) is one of the better editors at Seeking Alpha – here’s how he sees Friday and the near term future

Significant Indexes

• McClellan Oscillator fell  to -9.81 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – This is still NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – basically flat  -0.02% yesterday. [Anything over +/- @0.50 is significant.] Dollar closed at $81.54 and the line in the sand resistance level is @ $82.2 Closing above this level and moving higher would be negative for stocks. Mantra -right now The Dollar Rules

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

+23.7% Profit in 38 days

Before we go over these figures and answer there are 3 important points.

• Caution Don’t let it go to your head. For the most part these stocks were chosen when the US markets were oversold, other reasons, plus we were lucky
• Many many many thanks to Paul R for this data and contributing lots of stocks on the list
• Re-read points 1 & 2

The dumbest thing you could do go out any buy on the stocks on this week’s list.  Your Stock List – you send in the stocks – many are fine stocks, but only some get chosen for technical analysis because I do not have the time to go over a list bigger than 10 to 15 stocks.

Question’s answered.

• No Investors411 is NOT turning into a day or swing traders site. The basic formula of following trends will NOT change. IMAX’s 54.3% gain was the top stock on the list. It following an understandable trend in 3D technology.
• Yes you can copy or find old copies of the list usually each Tuesday (Wed. this week) by using the calendar at the top of the blog.
• Yes you can give a copy to your broker or file them in a circular container.
• I  can’t stress enough to learn something about technical analysis and have a fundamental concept of why your stock will be higher in six months.
• For a list of stocks Paul used to compute this see comments section on the right hand side.

Because your choices are mostly high beta stocks or those that are growing faster than others certain conditions must exist to put the odds more in YOUR favor.

• A bull market
• Oversold conditions – Investors uses the McClellan Oscillator or as Monitor named it the Mickey O. The more oversold the better.
• In general technically the stock has to be dipping, consolidating, or breaking out. (Its not quite this simple)

Our form of  unregulated capitalism has negatively impacted trends.  These trends are reestablishing themselves. The major technical trend now in US stocks is we went too far to the downside and will probably go too far to the upside.  The cloud and cause over all of this is the lack of regulation. This pattern will repeat itself until fixed.

Individual stocks are riskier and what Investors411 will try to do is to cut down on that risk.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Chucky’s Back

Intimidation

Its become obvious – The main thrust of the right wing in the USA is now Intimidation - “You’re either with us or against us.” This week alone the Intimidation has exploded to new levels.

• Man arrested for “Let The Violence Begin” Death Threat to Senator Patty Murray (D. WA) over her pro health care vote
• Man arrested for serial death threats to family of House Speaker Nancy Pelosi (D CA) over health care vote. “The mother links son’s death threat to FOX news“
• Revealed Massey mining disaster CEO Don Blankenship has spent over $6 million against any judges or state legislators who fought for workers protection in his mines. Massive and serious violations and fines not paid at this non union mine.
• Analysis of influx of violent threats including over 30 governors who received letters that they had “3 day to get out or else” over taxes (sorry there a short ad)
• Go. of VA announces Confederate history month (not civil war history month) and forgets to mention slavery. Imagine Germany honoring just their soldiers, and storm troopers  in WW 2 and forgetting the holocaust.Gov. later apologized. Analysis Listen to the letter written to Black congressman called N—-r and other names over and over in analysis.
• Republican Congresswomen Michele Bachmann quote “I want Minnesotans armed and Dangerous.” This is just one of many quotes. She appeared two nights ago with 1/2 term governor Sarah Palin. From last night Rachel Madow show

Montana has a long but enlightening history of the violence within the Republican party in the comments section of the blog. Is this their “Waterloo”? Now the intimidation, bullying and hatred is growing.  Repulicans are condoning it or ignoring it because it adds to their power/money.

Intimidation is unacceptable, it goes beyond the realm of free speech. It should be prosecuted as assault.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions for changes made each weekend

Increased, above average volume and moderate decline for US markets. Normally a big volume moderate decline would raise an eyebrow, but that’s the way this rally has progressed especially in the last month.

Investors411 has gone over all the warning signs, but momentum currently is still with the bulls. The McCellan Oscillator is technically in neutral territory so Investors will not add or subtract from positions now. (except or short term trades)

Seeking Alpha is the #1 recommended sight by YOU on stocks. You folks send me more personal emails on stocks from authors featured at this site than any other. Each morning it is one of the site I skim for news –  Their analysis of yesterday’s fall – a larger than expected decrease in consumer borrowing.

Consumer borrowing is certainly a factor, but it sure looks like the rising dollar (see below) and oil prices is more significant to both stocks and the economy. Mantra – Watch the dollar because it is close to a major resistance level – US stocks will move in the opposite direction. (See past Investors411 and below for reasons the dollar moves)

Significant Indexes

• McClellan Oscillator fell s to -6.84 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – This is still NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – rose  +0.27% yesterday. [Anything over +/- @0.50 is significant.] +o.53 over two days. and over 1% for three days.  The dollar over the last 3 days had a significant impact on why stocks fell yesterday. We are moving close to resistance/breakout level

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

EWZ (Brazil) Over the years the ETF’s for Brazil, China and Emerging Markets have been Investors411′s #1 investment choice. Although diminished (Down from 25% to 10%) EWZ is still #1. See OVERVIEW section of blog for more. Brazil:

• Benefits from a huge amount of natural resources.
• In 2000 a left wing government took over and spread the wealth so more working class people spent money. Money flowed so the economy grew. It does not have to be a “left” wing government to have greater success what you have to see is a spread of wealth/power from an oligarchy to working people who spend the cash. (there are other factors involved – but time limits explanation.)
• Brazil is less impacted by “shadow financials”
• Brazil has an election in late 2008 and term limits mean they will have a new President – This creates uncertainty and is a negative.
• More in depth economic analysis
• We have to be careful because Brail is going to outperform on the way up and down.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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SAVE THE INTERNET

Yesterday A District Court in DC ruled against “Net Neutrality” and handed over control of the internet to Comcast ATT and other cable providers. This gives big companies the ability to regulate internet traffic instead of it being FREE.

Will the Internet remain free? – “where anyone can create a Web site, post a video, start a business, or find the information they need without ISPs meddling with our traffic?” LINK

YOU CAN MAKE A DIFFERENCE. 1,700,000 have signed. Hopefully, millions more will signed this petition. We need to overwhelm the FCC with signatures to fight back. This is not a left wing or right wing issue (even the NRA & Christian Coalitions are involved on our side in this fight against big business) its all about FREEDOM. (Play video on right hand side of this link)

You have a little over 24 hours (9AM EST) to act before the public comment period closes.

Sign the Petition

https://secure.freepress.net/site/Advocacy?cmd=display&page=UserAction&id=437

After you sign the petition please please send it to your friends, paste it on Facebook, use twitter of whatever means necessary, but act to keep the Internet free.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions for changes made each weekend

Weak volume again, but leading indexes , NASDQ & Russell 2000) did manage to again outperform and slight gains. The slow, low volume melt up continues.

StockCharts (Its free & all you have to do is scroll down)) on one page carries links to charts and the daily performance of

• Major Markets
• Major Indexes
• AMEX Select Sector SPDRs
• US Industry Sectors
• MSCU iShares – International
• World Markets
• US Bonds
• US Commodities
• Currencies
• Market Breath
• Bullish Percentage Indices

This is why Stockcharts is constantly rated #1 among free technical analysis web sits and Investors411 uses and recommends it.

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Significant Indexes

• McClellan Oscillator fell slightly to +15.91 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – This is NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – rose  +0.26% yesterday. [Anything over +/- @0.50 is significant.]Falling dollar good for stocks & rising dollar bad. We have a ways to go before we reach resistance levels of a week ago.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

YOUR Stock List

This list has been developed by YOU sending in your stock picks, we discuss them individually (usually by email) and if they are trending positively they get included in YOUR list. Thanks to many of you who have sent in choices. If you payed attention to the List published on each Tuesday, you’ll find a lot of winners. One way to back check this is to use the calender at the top of the blog – click on past Tuesdays. Sorry this week its Wednesday

Caution- This is just technical analysis and lots of other factors enter into a decision to buy or sell

NB -Last Week’s comments in black. This week’s violet. Chart links underlined in Blue.

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

• CAAS –  China stock If you bought you won. Made higher high on chart. Pullback due. Rallied, then low volume  pull back yesterday. Some risk, but buy the dip
• PCLN –   If you bought you won Consolidation due. Melting up – Buy the dip
• F –   Looks like its running out of gas – too much downside volume – wait
• *IMAX .  If you bought you won Overextended now, but you know the story – buy the dip. Melting up – Buy the dip
• CSCO,  Will move with technology. Another winner, but weak volume suggest top is near – Wait Heavy volume dip weak volume recovery Other tech gains AMZN & AAPL look better.
• SHOO –  HUGE winner - way too over extended to buy now, but buy a reasonable sized dip. Dipped and off to races again. Still buy the dip stock, but now getting riskier
• ICON,   Another winner. Retreated yesterday in weak volume = bullish. A buy the dip stock. YOU won if you bought the dip. Now at breakout point but volume not increasing makes makesitit riskier buy
• DGIT – At its resistance level - Potential breakout stock Pullback in weak volume is bullish. Another chance at breakout, but risky. Dipped and if you bought the dip you Won Weak volume rally – Too risky now.
• VCI Dip in weak volume = bullish. Faces resistance, but potential breakout candidate. If you bought the dip YOU Won. a bit heavier volume on onupup days at resistance again. Risky buy
• CREE –  A potential breakout candidate. Still a buy the dip stock. Huge 10% breakout rally in volume. Dipped yesterday. Should see another lesser jump higher after dip. Buy the Dip
• SNDK –  Another Winner. now consolidating  A buy the dip stock. If you bought the dip YOU Won again. Dipped yesterday – each breakout usually gets weaker the closer together they are. riskier buy the dip
• CTRP –  HUGE winner – Decent volume at new high. Over extended, but buy the dip. Could go either way but volume good on up days – some risk, but A buy the dip stock
• CNAM China Stock, Breakout failed, now consolidating. Again more risky, but buy the dip

New plays that have similar 3d fundamentals as IMAX. Personally I’m more comfortable with this group because I believe in the fundamentals behind 3d technology. Some fundamental analysis included. Problem with these are their sales are not pure 3d plays.

• DWA (Dreamworks) . Dragon’s did not live up to expectations. Big volume behind downside move. Only for short term players who want to buy elliptical downside bounce.
• *CNK (Cinemark)   Think weekend Titan’s movie will bomb and hurt box office. Careful, but still buy the dip. Melt up in weak volume,(like IMAX) buy the dip
• *RGC (Regal Entertainment) Too overextended  Same fundamental problem of Titans, but better movies coming up.  Still buy further dips. Moving higher at breakout/resistance level. Buy the dip

32 million new heath care customers (Obama/Pelosi health care bill) means some stocks are going to rally on this increased supply and the growing aging population of baby boomers who need health care. New group

• *ESRX (Express Scripts) – Broke out, now a bit over extended wait for dip. Rally yesterday, but weak volume makes it a risky buy the dip. Eked out a new high a day ago and dipped a little. A Buy the dip
• *TEVA (Teva Pharmaceuticals)  Now dipping in reduced volume = bullish. A buy the dip stock. Seems to be consolidating, buy the dip

Analysis – Still. a lot of winners. IMAX was actually down -0.70% yesterday. Especially shorter term traders I’d buy anything over a 2% dip.

Remember stock don’t go in a straight line higher forever. It’s better to have consolidation periods like CREE, even if they are just for a week or two.  Almost always the futher the stocks get above their 50 day moving average the less likely the rally will continue. The exception to this is a melt up in WEAK volume.  Here too be careful.

The McClellan Oscillator is still near Zero so overall market upside and downside risk is equal.

* = Investors411 has a position in these stocks.

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Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

IMAX arc and camera

The Country is Headed in the Right/Wrong Direction

From Pollster.com a compilation of polls Note the trend.

Going Green to the Extreme

The Far Left has its own extreme views. Example – Lisa Hymas – Going Green is a reason NOT to have kids.  Her editorial - Say it loud: I’m child free and I’m proud. Money quote

“the single most meaningful contribution I can make to a cleaner, greener world is to not have children.”

Sorry Lisa, almost everyone feels completely different about kids than you.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made each weekend

Another rally day in falling well below average volume. = Bearish

Stocks rallied despite a significant rally in the dollar, oil prices at new highs, and the 10 year treasury bond hitting 4.00% yesterday (see chart on right side of blog) = Bullish

This chart of the benchmark S&P 500 at top has something called the RSI (Relative Strength Index) It is another indicator like the McCellan Oscillator that show when a market is overbought.  In this case overbought= over +70. The SPX now stands at +73.96.. In fact all major US indexes, according to the RSI are overbought.

There many different ways to technically measure buy and sell points (overbought & oversold). The RSI is one and it, unlike the McCellan says we are overbought. Right now the McClellan is working better than the RSI because we haven’t yet crashed and burned. So, for now, Investors411 is going to stay with the McCellan because its working.

When to Hold ‘em and When to Fold ‘em

Stocks – Investors411 has historically sought long term positions (hopefully years or many months) that follow trends. For a List of those trends click on Overview at top of blog. Unfortunately, along came the September 2008 meltdown/recession and those trends got interrupted or broken.  So shorter term positions became more desirable.  The lack of transparency clouding invstments and technology making everything quicker has impcted trends and markets.

Let’s look at two recent buys. IMAX & DWA One worked the other did not. Why.

IMAX – Up 40 to 50% since purchased.

• First there was a fundamental reason to buy IMAX. New technology trend in 3D is emerging and people are willing to pay more for the IMAX experience. Technically the long term chart also looked good.
• But now IMAX’s RSI is at 79.14 (well into overbought territory) and it is the furthest it has eve been over its 50 day moving average. There are a lot of other warning signs but I’m trying to keep this simple.
• Why hold fundamentally – the technology  trend/ demand is still in place and growing for 3D technology. More Imax theaters and a move into TV is emerging. Some potentially block buster 3D movies like Iron Man 2 and another Shrek are coming out.
• Why hold technically – For longer term investors, even though this stock is overbought, it is melting up in weaker volume. If there was a big volume rally (going elliptical) it would be time to sell.
• Technically IMAX is ahead of itself and you’d love to see a sideways consolidation. Yep, you could see a sudden dip, but right now there are plenty of investors wishing they had bought and they will purchase the first dip.

So for now Investors411 will stay put with IMAX and even nibble some more on a dip.

DWA – Lost -4%

• Dreamworks, DWA, looked like a perfect complement to IMAX. Proven kids films and a handful coming out in 3D would increase profits. So Investors “bought the dip” before the Dragons film was release. Technically a not great, but reasonable long term chart.
• What happened fundamentally – Dragon’s did not live up to expectations, in part because of the success of other 3D films (Titans & AIWL) Too many 3D films competing for too few screens. Good for IMAX and bad for DWA.
• I never like losses to exceed 7% (This came out of an old Investor’s Business Daily trading strategy) DWA did go up almost 10%, but Investors is looking for longer term holds or trends it was held.
• What happened technically – A downside move in heavy volume that broke a support level. So both technically and fundamentally there were reasons to sell.

Realize that there are lots of sharks that know more than you or me. What we can do is identify a trend and use some simple technical signs in trading. If the trend and the technicals covered are collapsing or going elliptical in big volume you fold ‘em. If the McCellan goes too high you fold ‘em.

Some of you use other ways to protect stock purchases like selling covered calls and using exponential moving averages.  These sophisticated investors like Paul R. know what they are doing. Most of you just want something to buy and hold that goes up or outperforms over a longer period.

CAUTION – There is nothing out there that’s a sure thing and everything has become riskier since the Lehman collapse and inability to fix the problem.

Significant Indexes

• McClellan Oscillator rose significantly to +19.12 yesterday.  [+60 or above = Overbought = sell. -60 or below = oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – This downward trading pattern has been broken. Moving toward overbought territory
• US Dollar – rose a significant +0.51% yesterday. [Anything over +/- @0.50 is significant.]

As stated before -What the dollar does over the next few weeks is critical to stocks and economics around the world. Falling dollar good for stocks & rising dollar bad in the short term

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend Monday) - These are positions I actually own

Limited time this AM – Will try for YOUR Stock List tomorrow. FYI – one recommendation CREE was up over 10% yesterday.

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Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING