James Verone

Sorry Server was down most of the morning  - so here’s a quick mix.

• Markets rallied in pathetically low volume.  Our MO indicator says thing are not oversold and back to neutral. Financial stocks took a hit yesterday.

• Greek gov’t has confidence vote tonight. It will pass. This should rally stocks. Key is the size of demonstrations in front of parliament. Greek people feel banksters share responsibility for crisis and should be held accountable not just people of Greece.  This crisis through out Europe is going to be twisting in the wind all through summer and beyond. Besides its debt problems Greece now has to pay almost 30% interest rate on its bonds.

• Banksters are calling the shots in Greece as they have since the 2008 meltdown. “The epicenter of the new crisis is Greece, which epitomizes the folly of banker rule.” - Bob Kuttner

• SHIBOR rockets to 8.6% – Translation =  China has a significant exploding inflation problem that crucial to economic worldwide growth.  Not good news.

• Lots of blogs headlining how you can get health care for $1.00. Story of James Verone who desperately needed medical attention so he held up a bank for $1.00 then say in a chair to wait for police.  He now gets free medical care. – The money quote from Verone - “When you don’t have your health you haven’t got anything.”

• Read of tea leaves – short term rally continues on Greek news. No change in long term outlook or strategy.

Paul’s Corner

1^st Official Day Of Summer! Wow! Market futures are up, time to jump back into the pool?

Yup at 6:30 this morning market futures are up and you know what that means, once the market opens at 9:30 all bets are off. Great place to put your money, eh?

Yesterday was an up day and many of the indexes finished up but it was done on low  volume.

The bulls are trying to make a stand but there appears to only be a few bulls ready for action.

David Garlardi, an HGSI user, posted a link to an interesting article “Economies are slowing around the world…

LINK

The last line is important “The US dollar gained against the Aussie dollar and other major pairs as investors’ risk appetite diminished following the minutes. ” If this indicates a change in the direction of the US dollar, a strong dollar equals a weak market. (Interesting, the world economy is slowing, I GUESS Obama’s policies really don’t work)

Bio-Tech led the way yesterday in the high demand stock search, 2^nd and 3^rd have some of our old favorites:

Apparel Accessories & Luxury Goods (5.00%, 5 securities)

• Fossil  Inc. (FOSL)
• Lululemon Athletica  Inc. (LULU)
• True Religion Apparel  Inc. (TRLG)
• Under Armour  Inc. (UA)
• Warnaco Group  Inc. (WRC)

Specialty Stores (4.00%, 4 securities)

• OfficeMax Inc (OMX)
• Signet Jewelers Ltd. (SIG)
• Tractor Supply (TSCO)
• Zale Corporation (ZLC)

So what’s the market going to do today, futures are up this morning, is this a new morning in America or another fakey before the BIG crash? Let’s load up Quote Tracker………here we go folks another day of fun!

Remember, you are responsible for your investment decisions, and I am not.  Please do your diligence, and please take ownership for your actions because I‘m sure not going to.

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Longer Term Outlook

Neutral/CAUTIOUSLY BEARISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

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Gulf Oil Spill & the Financial Crisis

Bob Kuttner, often mentioned in Investors411, explains why the Gulf Oil Spill is almost exactly like the Financial Meltdown. [Bob is from my hometown and used to endorse my wife when she ran for school committee]

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

Significant Down day in mixed light volume = Moderately Bearish

Massive amount of bad news – N. Korea, BP failed to plug oil, Israel/Turkey/Gaza. Surprised markets did NOT drop more. = Bullish

MO getting close to Oversold = Bullish

Expect Fed and other central banks to prop up Euro again = Bullish

In the long run price fixing rarely works. This is what our Fed and other central banks are doing to the Euro. However, as long as investors are willing to buy government bonds at a low price the situation will hold. Best read of tea leaves – Don’t see any signs of impending breakdown. = Bullish

Significant Indexes

• McClellan Oscillator fell to -50.19 [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is nearing OVERSOLD territory.  How the MO works.
• US Dollar –  The dollar rose +0.03% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important. Currency markets are now being directly manipulated by out Fed and other central banks. This manipulation to keep the Euro from falling = Bullish.

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

Have NOT had a chance to update last weeks trade.

YOUR Stock List

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

Terminology

• 50 Day Moving Average of price- blue line on chart = 50DMA
• 200 Day Moving Average - red line on chart = 200DMA
• Ticker symbol for each stock is a link to a chart.
• Volume - Horizontal red (down days)and green (up days) line at bottom of chart show volume
• * Owned positions
• “Volume good” - translation – relative to major indexes individual stock is looking good – probably more upside volume on rally days than downside volume on toasting days.

Most of you are looking for longer term buys. Remember Stocks are in most cases riskier than most ETF’s. Our main strategy is to buy the dip of a stock that is trending higher.

Relativity – The last YOUR stock List was done on 5/18

• The Dow was above 10,600. Now the Dow this AM is just above 10,000 = almost -6% lower
• MO was at -68 then and -50 now = conditions were more oversold then than now, but still oversold.

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

• AAPL . @+1% since 5/18. Last big cap tech stock left standing. Has held up pretty well. Caution – Chart shows its near strong resistance level. Formed double bottom = Bullish Should continue to outperform. Buy the Dip
• SHOO @-6 Chart shows lower highs and lower lows. Old favorite that has produced in past in bearish pattern – Gone.
• *ICON @-6% Another series of lower highs and lower lows – Gone
• DGIT @+0 Firm tend line higher. Higher highs and lows. Good volume. Dipped down @5% from high three days ago. Has had 10% dips in past. Buy the Dip
• *VCI. @-2% Has series of higher highs and lows. Good volume. Big fall -5+% in moderate/weak volume yesterday. Buy the Dip
• SNDK @+5% Broke out to new high and is falling back to breakout level in weak volume. Buy the Dip
• CTRP @-0% Stock has big swings and trouble getting past strong resistance at @42. But series of higher lows & decent volume make it a potential winner – Buy the dip
• *ESRX - @-2% Still outperforming markets, Volume good. Has strong resistance level at @105. Consolidating. Future Breakout candidate. Buy the dip
• *IMAX @-15% Investors411 has sold 3/4 of this position. Our +60% gains are melting away. Dangerous head and shoulders trading pattern forming. Volume not good. At critical juncture. Sell into rally.
• MSPD @-8% Lower lows and lower highs. Oversold right now but pattern broken.

Fresh Five – 5 new stocks

• OSTK (Overstock.com) Exploded higher in early April & May. Now consolidating. Dipped last 3 days in weak volume. Getting close to rising 50DMA. Buy the Dip
• JAS (Jo Ann Stores) Has had trouble (like ESRX) getting past resistance level above 47. Good volume. Dipped last 2 days after attempted breakout failed. In trading range between @40 &  @47 Outperforming.  Buy the Dip
• BIDU (Baidu INC – China’s Google) Outperforms. Broke out/soared  in May & has pulled back. Support at rising 50DMA. Buy the Dip
• SAM (Boston Beer Co.)Great Beer Co. going elliptical on breakout run higher. Wait for correction
• EVVV (ev3 Inc.) Had a HUGE +17% move yesterday in giant volume. Wait for correction (Last 2 both have lots of potential)

On the whole YOUR stock list outperformed major markets over the same period of time. Since generally the stocks chosen have a higher Beta (more volatile) you’d expect them to do worse.

Since Central Banks around the world are flooding the currency markets with money to stabilize the Euro its hard to see another major leg down in stocks right now. Remember, if Euro goes down, the dollar goes up and that hurts stocks.

BP/Transocean/Halliburton, N Korea, Euro Debt, Israel/Turkey/Gaza issues have all seemed to have been priced into the market. Overall, for long term investors still = CAUTIOUSLY BEARISH

Politically the Obama administration, as every administration before him, will bend over backwards to keep stocks moving higher into elections.

Traders – You’d like the McClellen Oscillator (MO) to be lower, but a short term  trading window is decent. NOT great.

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Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Sherod Brown – Senator from Ohio – A new major player in financial reform

Rules based vs. No rules Capitalism

The 2008 worldwide economic meltdown, cause even Alan Greenspan to realize that markets needed to be regulated. Let’s look at -

Three Major Entities in this drama.

• Rules based companies – They create or deliver products – P&G, Chevron, Apple, UPS, GM, and even that wonderful artist who you should buy from. Sure, all companies have some sort of problems and may fudge or break the rules, but they produce and /or deliver products. Their profits are based on the products they produce, deliver and services they maintain. They use more transparent accounting.
• Shadow based financials – They profit from leverage – A needed commodity to foster growth – AIG, BAC, Lehman Brothers, GS, & Citigroup. This is the group that got itself over leveraged because it was unregulated. Instead of being leveraged 10 to 1 (loans to cash) many in this group reached leverage near 100 to 1 using unregulated credit default swaps etc. . So when Lehman collapsed the whole  financial & economic world went with it to the brink of financial collapse. This is the group that most want no rules capitalism or “free markets.” There are, of course, smaller banks that did not get over leveraged.
• Taxpayers – You benefit and support each group by buying their products or entering into a loan. All this is a necessary part of a growing economy. The problem enters when the profits gets privatized and the risk gets socialized you and your children  pay.  Now the Shadow banks that are fighting to stay in the shadows.

Major Political Players in Congress (for sources on lots of this see past Investors411 or OpenSecrets.org

• Chris Dodd (Dem. CT) – head of powerful Senate financing committee. The Senate’s important because it has the filibuster/ 60 vote rule. Senator Dodd snuck in the rule that bailed out shadow banks could get their executives bonuses. Democrats on his committee have created (weak – my opinion – see past references to Simon Johnson and Baseline Senerio) legislation to try to fix unregulated shadow financials
• Mitch McConnell (Rep) -Minority  leader of Senate. Met secretly with 25 Wall St. Shadow bank types and #1 contributor is financial institutions.  He’s trying to unify Republicans against the Dodd reform Bill.  The Republican line is “complete and deliberate misinformation.”
• Senators Kaufman (D -DE) & Sherrod Brown (D – OH) – have a strong bill forcing the elimination/downsizing of the too big to fail banks. They have some support, including Fed governors, but not enough. Dodd holds all the strings.
• Blanche Lincoln (D Ark) – has introduced a bill to regulate what Warren Buffett called Financial Weapons of Mass Destruction – Credit Default Swaps.

Obviously the Shadow institutions and their lobbyists want to stay in the shadows. Most taxpayers want reform. You do have a group in congress who say leaving everything alone, let them fail and bring on the second great depression.  This is all getting played out this week in congress.

Fed Governors have jumped on the  elimination/downsizing too big to fail banks bandwagon, but Dodd is a consummate political pro who is in bed with shadow financials – remember, he granted them bonuses. Most Republicans want a weak reform bill and have historically voted against regulations.  Many traders are also putting their money on/investing shadow banks by buying their stocks.

For the latest see Simon Johnson’s piece last night

Here’s my home town’s Bob Kuttner on the differences between Republicans & Democrats

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

Giant institutions are buying stocks on dips like the Cookie Monster eats Cookies.

Five straight rally days in a row. Markets moved higher in decreased volume. This has been a usual occurrence for stocks over the last two months. Historically, moving higher in deceased volume is indicates BEARS rule, but that’s not the trend. So we go with the trend = Bullish

You don’t need a weather forecaster to know which way the wind is blows. Even with 5 up days in a row the wind is still with the BULLS

Last Weeks Fearless Forecast – “Down Week”- Goldman Sachs, Greek debt spreading, fears of financial reform and even a volcano couldn’t hold the Cookie Monster down = Bulls Rule.

This weeks Fearless Forecast – The problem here is so many analysts see markets moving higher. Since the McClellan is not yet near oversold prediction is for an up week. Beast single reason for this call is stocks keep moving higher despite bad earnings news in giants like MSFT, AMZN and former tech darling QCOM.

Earnings reports hot and heavy this week & the Fed makes its usual announcement on Wednesday at 2:15 EST. For more see

For those interested in individual stocks here’s a list of best & worst of them who have reported earnings. Again from Seeking Alpha.

Analysis from Friday – If markets are down around noon expect the Cookie Monster to eat the cookies, vegetables and whatever is out there The Cookie Monster (huge institutions investing) stared to buy and eat stock at almost exactly noon.

Significant Indexes

• McClellan Oscillator rose  to +19.86 Friday.  [Basically, +60 or above = Overbought = sell. -60 or below = Oversold = buy]. More sophisticated investors can use the 50 & 200 day MA’s and adjust from there. StockCharts has a better version of the McClellan chart ($NYMO) LINK. - This is  still NEUTRAL territory, but moving toward oversold.
• US Dollar – fell a -0.30% yesterday after opening much higher. [Any move over +/- @0.50 is significant.] Mantra - right now The Dollar Rules Is very important. Remember, dollar down almost always = stocks up and visa versa. The positive earnings reports are overshadowing the dollar which is in the upper end of a consolidating range between @$80.00 & @$82.20. Dollar at $81.41. If it moves to either side of that range it will impact stocks.

Positions

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

The McClellan Oscillator is NEUTRAL and moving toward overbought.  There is still a long way to go before stock are overbought (@+60). So technically there is some room for the rally to continue. However a better time to buy (less risk) or make a longer term investment is when stocks are oversold. (@ -60)

ETF Trends is a good resources for longer term Investors. I have it bookmarked. Here’s a sample on Emerging Markets

Traders will be interested in Paul R’s comments on side of blog concerning individual stocks.

Why are US stocks outperforming emerging markets?

• They collapsed further than emerging markets and especially the financial sector.
• There has been no reform of  the shadow financials and financials again have become becoming the dominant sector of US markets

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)

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Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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Teddy Roosevelt

Back in the early 1900 Republican President  Teddy Roosevelt busted up the big monopoly shadow banks when they tried to take control of government.  Big Wall Street banks have increased their control over Washington for almost 3 decades. Is Barack Obama a Teddy Roosevelt?

Can financial reform end the too big to fail problem? “Big shadow Banks have become even more powerful since the 2008 meltdown.”  Worthy editorials & videos

• Baseline Senerio’s MIT prof Simon Johnson today on Paul Volker
• Again MIT’s Simon Johnson on Steven Colbert show. As always humorous, but informative video (Interview starts at 15.00 minute mark into show and last 6+ minutes)
• Bob Kuttner former Businessweek & Boston Glob reporter who has his own mag., American Prospect on banking reform and the need for a game change like Teddy Roosevelt

If Democrats want an issue to run on in November. This is it. But perhaps/probably too many  are owned by bank lobbyists.

Bottom Line – If the financial legislation ends the too big to fail problem its good. If not it stinks.

The Public Option Did WIN

The “inclusive, single payer, cost effective, money saving ($61 billion over 10 years – CBO) robust Public Option” was won in education. This overlooked  bill was passed along with Health Care reform and cut out the banks (middle men) and opens opportunities for anyone seeking help at the college level. Jeff Cohen editorial

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 day of weak volume.  US equities were basically flat. Flat prices in high volume indicates a shift in course. Flat prices in low volume indicates little.

Good news was consumer confidence rose last month. Seeking Alpha (one of the best financial sights out there) presents an interesting long term view that low consumer confidence has historically been a good time to buy stocks. Bad news was concern over sovereign debt (see below)

KING DOLLAR is the major index to watch. (see below)

Significant Indexes

• McClellan Oscillator fell slightly to -4.55 yesterday. [+60 or above = Overbought = sell. -60 or below = oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. -Same pattern continues - We right in the middle so NO clear signal. However we are still in bearish pattern of lower highs and lower lows.
• US Dollar -started back up +0.21% yesterday.

What the dollar does over the next few weeks is critical to stocks and economics around the world. The dollar has risen 10% since Dec.. This means that US & China (their money is pegged to ours) exports are 10% more expensive to the rest of the world. A higher dollar,therefore, puts real negative pressure on US/China stocks, what you pay, and an economic recovery.

This is why the sovereign debt crisis in Europe [PIIGS & former Russian satellite countries] has the potential to plunge us into round two of the recession. The dollar is rising because of the problems in Europe.

Positions

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

DWA (Dreamworks) Ended up selling all of DWA for 4% loss. Was stopped out of 1/2 and sold the rest. Selling the last 1/2 was probably a short term mistake because after three days of big volume selling it should bounce higher this AM. Loss -4% on 2% of portfolio

RGC & CNK – Opened a 1% of portfolio position (hopefully long term position) in each stock. RGC price = 17.68 & CNK = 17.98. Will add to these on dips. Caution if Easter weekend movies bomb, these two stocks will get hit. A safer entry point may  be Monday or Tuesday.

Waited for even a 2 to 3% dip in IMAX to buy a bit more, but it just not happening. IMAX is NOT having a climax buying spree (going elliptical) yet, because there is NO big volume behind the rally. IMAX now up 30 to 40%

Will try to add a 2% position in TEVA today. Hopefully at a slightly lower price.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

WHAT’S UP? – Two unsung Heroes -Health Care Rescourses – Bears with stock market football – Our stock positions (some recommendations) – Oil prices breakout – Shadow Banks – Profiles in courage.

Two Unsung Heros

This year two outstanding women won the Profile’s in Courage Award given out by the JFK Presidential Library. 

Shelia Bair – (google photo)

Bair is the head of the FDIC and a Republican.  She opposed many aspects of the Paulson/Geithner shadow bank bailout. She was “the lone voice in the wilderness for her early warnings about the sub prime lending crisis.” She like Elizabeth Warren stands out as a voice of economic dissent in the Obama administration. For more see Bob Kuttner’s editorial

HealthCare

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

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Technicals & Fundamentals 

The losses might seem small, but the major US indexes were up almost 2% in the early afternoon. That’s a big drop into the close. Much bigger than yesterdays last hour plunge.  What’s worse is that Volume increased and was above average. Therefore volume confirmed the move lower.

XLF - The ETF that tracks financials (mostly shadow banks ) fell -2.66% . This index closed at 11.72. As stated in past updates for the last 3 weeks financials have been trading between @ 13+ and @11+ (more specifically support at 11.33 and resistance at 13.08) Any close above or below these support of resistance levels would turn confirm a longer term trend for bull or bears.

WTIC – Oil prices confirmed their breakout above $60 and ended the day +3.23% at $62.04. Energy related stocks kept the rest of the US markets from loosing more ground. As stated before – Higher oil prices are an indication of economic recovery, but also hurt that recovery because it means energy prices will rise.

Reading The Tea Leaves - For more than a week volume has not given us a signal as to the direction of the markets. It did yesterday. Two or three high volume meltdowns can turn the direction of stocks.  The football is now with the Bears. Watch the XFL. If it breaks down through its support level and closes significantly below 11.33 in big volume, then you will probably see more damage to markets. Also 891 in the S&P 500 is another critical support level.

Positions - (See positions section of blog for more)

Long Term Investors 

• Looking to increase positions in gold (GLD) 
• Waiting to get back into Brazil (EWZ) on dips.  Right now Brazil’s 2 main exports coffee and oil are at multi month highs. 
• GEX (alternative energy) is running higher with the move in oil.  It too broke out to a new 6 month high. Best read of tea leaves is the move in oil above $60 is unsustainable and both (GEX & WTIC) will fall. You can take some profits here especially if you bought the dip around $15 to 18. GEX closed at $25.67 and hopefully buy back in on a dip. 

Shorter term traders - 

• Personally, if I had the time, I would probably trade any drop of the FNX to its support level. 

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING !