Couldn’t find a dump truck, but money tree will do

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!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Index Percentage Volume
Dow +0.73% down
NASDQ +0.48% down
S&P +0.72% down
Russell 2000 +0.99% -

Technicals, Fundamentals & Analysis

Investors411 record – 5 years of beating benchmark S&P 500

US Stock Markets -

An army of editorials Monday from Wall Street insiders say the mortgage/foreclosure crisis for shadow banks is “large but manageable.” ($100 to 120 billion cost figure was used as an estimate) In fact, BAC has partly dropped moratorium on some foreclosures. These editorials into the opaque world of shadow financials have seemingly calmed investors and the #1 mortgage bank (BAC) after a 10+% loss the last few days rose +3.01% in huge but decreased volume.

The Fed does what its done for well over a month and manipulated the US stocks by injecting $6.2 billion into the economy through the POMO program.  This figure has grown in recent days. The dollar rally died and stocks rose. If shadow financials are getting injections of cash like this its hard to see any crisis hurt their bottom line.

AAPL had another well above average earning report. As predicted, after up 10 days in a row investors sold the news in after hours trading and the stock was down about -5%. Apple is so big it makes up 24% of the NASDQ.

So look for a hit in techs early today. Right now it looks like NASDQ will be down -1.5% at the open.

Markets have seemingly absorbed the hit to shadow banks and will probably absorb the hit to AAPL. The quicker that happens the more bullish for the markets. Obviously stock to watch is AAPL today.

Significant Indexes

  • The Dollar (USD) [Anything daily price move over +/- 0.50 is significant. Dollar usually moves inversely to stocks] The dollar fell -0.14% yesterday. The inverse correlation is not always perfect. A big move higher in AM was crushed. Overall trend of falling dollar trend for US stocks is = Bullish
  • The Baltic Dry Index (BDI) [measures cost of world trade. Also proxy for China, emerging markets, exporting countries] Fell a very minor-0.22% yesterday. An 8 week bull run, then a two week fall. A very slight stutter and now moving up. Trend  = Bullish
  • McClellan Index – (MO) [The rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks.] Rose to +10.50 yesterday. Lot of room to move both higher and lower. Momentum is with the stock bulls but location= NEUTRAL

Reading Tea Leaves.

Chaos has been restored by the Fed backing up the dump truck of freshly minted cash and dumping. This reminds everyone from Investors to High Frequency Traders the Fed is going to print and dump, print and dump, print and dump

The MO is in neutral so there’s room to buy the dip, of a rally.

Obvious end game of printing and duping money is INFLATION.  The play investors have made to diversify and protect against inflation is into commodities like gold.

What to watch –  For Bulls -

  • Does BAC continue to stabilize and/or move higher.
  • Does APPL after 4 to 5% early hit stabilize and/or move higher.
  • Key is still the dollar – tracking ETF is UUP

Best read of tea leaves is if foreclosure crisis couldn’t sink bulls, then AAPL earnings (maybe a bigger hit) will not sink bulls. Market is being manipulated by the Fed’s print and dump. As long as there is no end in sight for printing and dumping stock move higher.

Positions

The  Positions Section link to latest & former buys and sells  - These are positions I actually own

(I do manage 6 accounts that have other positions)

  • EWS (Singapore)
  • USO (price of oil/commodity).
  • SSO (2x what S&P does) – Tightened stop and may sell/take profit today.

Buying dips in gold, oil, and recommended stocks still a viable option for both Traders and Investors. Commodities like gold and oil also give you diversity.

We should see a dip this AM. Perhaps throughout the day. Perhaps longer. But as long as the Money Tree at the Fed keeps growing or the Dump truck keeps dumping bulls should rule.

Any of the above are decent plays along with recommended ETF’s and stocks.  As PAUL constantly & The Critic on AAPL, reminds – don’t go chasing those stocks that have soared too far above their 50 day moving average.

Investors411 chief strategy is to look for equities that are trending higher, then consolidating (buy the dip) before the next move up

Look for Paul R’s always enlightening comments on stocks and sectors in the comments section.

Longer Term Outlook - CAUTIOUSLY BULLISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

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