Photo of stabbed NYC Muslim Cabbie.

Mother of All Traffic Jams

Just How fast is China growing? Just how much does China need more infrastructure? – Now a nine day 60 mile long traffic jam outside the capital - Video

US Islamophobia Grows

Allegedly drunk NYC guy cuts throat of cabbie after he responded yes to question –  Are you a Muslim? He’s being charged with hate crime Story

Pop Quiz

I’ll buy dinner to anyone over 40 who gets this right and hasn’t seen the list. It says a lot about where our country is headed. Here’s a  List of the top 50 social media sites on the web. Can you guess who/what is #1? Nasty Hint Obama is #3

Bruce Lee Plays Ping Pong

Phenomenal add run on China TV by Nokia. You’re not going to believe this (Thanks to AG for the find) It takes @ 15 seconds till the OMG part.- VIDEO

Housing & Wealth Creation

Fabulous article by James Kwak at Baselne Senerio. Own a Home or thinking of buying one? You must check out the article and graph

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!

Technicals, Fundamentals & Analysis

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

Mantra for the month - The Black Box/High Frequency Traders BB/HFT control the majority of trades.

The Symphony

Because the High Frequency Traders (HFT’s) use their Black Box algorithms to trade across markets there is a  phenomenally higher degree of correlation between stocks, currencies, commodities (especially oil) and other markets. One inverse correlation has become very crucial in this symphony. That’s the inverse relationship between the dollar and US markets. This is why the US dollar is one of the Indexes followed by Investors411.

Yesterday’s Stock Markets

Even the market cheerleaders on the main financial channel CNBC seem to be growling bears about US & therefore world stocks.

A typical rally day in deceased volume. Because of the BB/HFT’s volume is no longer the #1 forecast tool of major indexes.

We again had absolutely horrible housing news that was worse than expected, yet oversold markets rallied.  How markets react to news is a good indicator of the near term future. For now really bad news is built into stock prices.

Today we will have another bad weekly unemployment report. Since we’re still close to oversold on the MO it will probably take some really bad figures to toast stocks.

Significant Indexes

• The Dollar (USD)  [Anything daily price move over +/- 0.50 is significant. Dollar moves inversely to stocks] The dollar was flat (up a smidge) for third day in a row, +0.14% yesterday.  Two week rally in place. Now facing resistance at 50DMA. Three flat days in a row could signal a reversal of trend & the dollar start to drop. But until this happens, for stocks outlook = Bearish
• The Baltic Dry Index (BDI) [measures cost of world trade. Also proxy for China & emerging markets] Fell -3.08% yesterday. First fall in a 5+ week long rally. Long rallies are typical in the BDI. This could be a reversal of trend and bad for emerging markets. If BDI fall increases today the outlook will change to bearish = Neutral
• McClellan Index – (MO) [The rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks.] MO rose  to -48.98 Slipped out of, but is still close to oversold territory = Neutral

Reading Tea Leaves

The massive currency/Dollar market is still key to stocks. Fundamentally, parts of Europe are so bad off its hard to see the dollar not rise in relation to the Euro and therefore probably move higher in relationship to all currencies. UUP the dollar ETF is still what to watch.  It goes one way and stocks will go the other.

Yesterday was probably NOT the near term low for US equities. But remember rallies start from oversold bounces. The last oversold bounce saw a 3 day rally, the two before that 3 week rallies. Of course, everything could get shattered if the dollar soars or we have a really really bad weekly employment number.

Positions

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

Current positions - Small positions in EWS (Singapore) USO (commodity-Oil) & slightly larger in TYH

Traders – Bought TYH at 24.68 & sold 1/2 for +3% gain at 25.50 (10% of portfolio position now 5%) Stop set at 24.43 and will move it higher in a rally. Reasoning behind trade – MO oversold. Big dip at open & double bottom formed. The dollar was flat so I pulled the trigger.

Investors – Any time the MO closes below (if you willing to take more risk – close to) -60 and the markets dip further is a chance to purchase one of the long emerging market of energy rich country ETF’s. See List in Positions. It’s safer to do this if the MO is below -80 and still safer if it goes beyond -100

Long Term Outlook - NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Is it time for Investors to put on their helmets and head to the bunkers?

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!

Technicals, Fundamentals & Analysis

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

Mantra for the month - The Black Box/High Frequency Traders BB/HFT control the majority of trades. Paul R in the comments section has found a great source describing the BB/HFT traders and consequences of what they do.

Another increased above average sell off that has been typical of the BB/HFT controlled US indexes for many many moons.

Perhaps its time to bring  out the old  Lost in Space Robot with all its bells and whistles and scream DANGER WILL ROBINSON DANGER DANGER. This was the third big volume significant downside day in the last two months and that almost always means the worst is yet to come (The Hindenberg Omen?) But BB/HFT’s have made a mokery of this kind of technical analysis. So caution is in order but the Robot is peaking out of the closet.

Here’s what’s holding up US stocks (Clearly NOT the US economy which is deteriorating) – Emerging Markets

EEM the ETF for emerging markets was down about 1/2 of US indexes (-0.77%) How long can emerging markets can things to hold together in the USA (see Reading Tea Leaves)

Significant Indexes

• The Dollar (USD)  [Anything price move over +/- 0.50 is significant. Doll moves inversely to stocks] The dollar rose +0.27% yesterday.  Almost two week trend = Neutral
• The Baltic Dry Index (BDI) [measures cost of world trade. Also proxy for China & emerging markets] Rally +3.66% yesterday. 5 week trend = Bullish
• McClellan Index – (MO) [The rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks.] MO fell to -27.32 = Neutral

Reading Tea Leaves

The good – The 5 week rally in the BDI is a clear sign that emerging market growth is continuing. China’s ( the #1 emerging market) stimulus worked, but almost overheated their growth. They have come down into a more normal range and are becoming more self sufficient every day.

The Bad – Back in 2008 Investors411 stated – the economic mess was far, far far, far, far bigger than expected (best example financial sector & this statement is still posted in POSITIONS section of blog) Economic mega trends (see OVERVIEW section of blog) have started to fracture both the USA & Europe economically. Neither has an abundance of cheap oil (peak oil mega trend)

The Ugly – Obama’s stimulus plan & tax cuts have halted the fall, but the jobs are still going overseas because of globalization mega trend. More jobs will be lost as the will for more stimulus fades. It’s election time and even a $60 billion (may have figure wrong) aimed directly at small business (“the engine of jobs growth”) and formerly supported by many Republicans was filibustered by those same Republicans. Nothing will get done in the next two months.

Longer term - 10s of millions of new jobs are being created each year in emerging markets. Millions more are graduating from universities in these emerging markets. When a computer tech will work 12 hour shift in China for $0.75 an hour and the same tech in the USA costs $18.75  for an 8 hour shift, who is Apple going to hire? (I made up the figures)

Just finished writting this and I’ve talked myself into and even more bearish position.  So lets go with the kitty in a helmet

Positions

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

Current positions - EWZ & EWS sold 1/2 of EWS for 0.5% gain

Because of yesterday’s meltdown  held off on buying USO & will start with a smaller 2% stake in a dip today.

Long Term Outlook – NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Lights Going Out Across America

NYT’s/Princeton Nobel prize winning Paul Krugman editorial certainly not a rosy forecast.

This is My Lucky Day

Great Video sent in by E.R. Enjoy! Also from same site totally different but entertaining video from flixxy.com

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!

Technicals, Fundamentals & Analysis

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

Same Mantra for the month -The Black Box/High Frequency Traders BB/HFT control the majority of trades. Paul R in the comments section has found a great source describing the BB/HFT traders and consequences of what they do.

Here’s a look ahead for Wednesday market.

The big news out of yesterday was the Fed meeting and suggesting Long Term Interest Rates can go even lower. That’s bullish for stocks.

Significant Indexes

• The Dollar had a huge rally but ended the day up only +0.11%. Rally (+0.85% higher) that collapses is usually bad news for dollar and good news for stocks , but we are still holding support.= Neutral/Bullish
• The Baltic Dry Index (BDI) kept accelerating its move  higher (+4.64%) = Bullish
• McClellan Index – (MO) [Basically longer term  - the rough guideline is over +60 = overbought market = sell or short stocks & -60 = oversold market = buy stocks.] MO fell to +7.68 = Neutral

Reading Tea Leaves

The BB/HFT traders because of their size, scope, & frequency are creating correlations across diverse markets. They trade futures in currency, commodities, stocks and other markets.  What this has done is create a greater unity in these markets. One prime example is the dollar going down for a few days almost always means stocks will go up.

While normal investors or traders can’t match the speed or size of the BB/HFT’s, the simple advantage we have, is we can watch their direction. Because of their big size hey leave footprints/trends.  Simply follow the trend.

Longer term – What’s growing the fastest is emerging markets and the US companies that export to them. If the dollar keeps falling, US exports will cost less and US stocks will grow.

Short Term – Nothing goes up or down in a straight line. There’s problems out there from a phony opaque financial system in the US to an overheated housing bubble in China. At sometime major problems like the two examples or others make noise and markets tumble.

The three indexes above are guideposts to what’s happening or will happen. Right now the major fight is over a key resistance/support level of the dollar and it looks like the dollar bears might win. This would be good news for stock bulls.

Our key forecasting tool is the MO is in Neutral. This gives us “wiggle room” both on the up and downside.(see above)

However, despite some potential good news in BDI & dollar, when you look at the chart of the MO you’ll see a series of lower highs and lower lows. This is NOT good. For those who know more about technical analysis the MO has also broken down through a “head and shoulders” pattern. Again NOT good.

Therefore, despite some encouraging news in the dollar & the BDI it looks like in short term we are heading lower.

Positions

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

Current positions .

• EWZ (Brazil – Now 5% of portfolio position) Bought at 69.80. Currently at 70.50. Considering selling remainder.
• TYH (3x technology – 2% of portfolio position) Bought at 31.76 Sold yesterday at 31.08  for -2% loss

Mea Culpa – Investors411 has brought this up a handful of times yet failed to take action each time its happened. Buy GLD on dips.

The Bulls seem to be loosing control and the MO is in the middle of neutral territory.  Perhaps the MO will drop low enough to consider buying again.

Long Term Outlook – NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

-

The China Trend

Pew Dec 9th 2009 poll showed American’s believe China is more powerful economically than the USA. 44% of Americans believe China is “larger economically.” It’s NOT, by a wide margin, but its growing a whole lot faster.

Perception is often far more influential than reality. Threat’s why our culture spins & manufactures the news instead of reporting it. Bottom line here is China sneezes and the rest of the world will catch a cold. They used to say this about the USA, but times are changing.

There is one major problem in China’s future and that is when will China’s housing bubble burst? When this happens everything from politics to economics across the world will take a hit.

The good news is there has not been shadow bank massive over leveraging of China’s housing problem.

The bad news is 65 million new vacant apartments and the above housing graph. For more see this LINK

Bottom Line – When this bubble bursts everything from stocks, politics, employment, to even your houses value will feel the impact.  This is the #1 DANGER WILL ROBINSON, DANGER DANGER that hangs over the world’s economy today. You could argue that  a phony opaque financial system is a bigger bubble, but that’s hidden from the perception of most Americans.

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!

Technicals, Fundamentals & Analysis

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

Same Mantra for the month -The Black Box/High Frequency Traders BB/HFT control the majority of trades. Paul R in the comments section has found a great source describing the BB/HFT traders and consequences of what they do.

“Stock futures retreated Tuesday (today) as investors grew a little more cautious ahead of the Federal Reserve’s meeting and after China’s economy showed some signs of slowing down.” – from AP

If your an Investors411 reader, you know the BDI dropped 60% over the last 3 months – Of course China’s imports dropped. However we have seen a recovery over the last two weeks in the BDI.

Significant Indexes

• The Dollar rose a heathy +0.38% on Friday. Now sitting again directly on its support level = Neutral
• The Baltic Dry Index (BDI) is accelerated its move  higher = Bullish
• McClellan Index – (MO) Check out the link to the new chart. Lots more data. [Basically longer term  - the rough guideline is over +60 = overbought market = sell or short stocks & -60 = oversold market = buy stocks.] MO rose to +40.12 = Neutral

Reading Tea Leaves

From Yesterday – “There is a 5 week bullish trend. Benchmark S&P 500 at 1121 and every stock analyst watching the resistance levels around 1130.”  Yesterday the S&P closed at 1127.79.

Yesterday was “Magic Monday” where the breakout was supposed to happen. It didn’t and that’s probably going to make the BB/HFT traders anxious.  We tested the 1130 SPX number and the Bearish algorithms of the BB/HFT’s kicked in.

May be wrong, but yesterday sure looked like a day that the bulls legs got weary.

I’ve mentioned “wiggle room” for the MO in the past week or so of up dates. This exists still on the upside, but it comes more into play if the bulls are in charge. The distance to the downside (-60 is a lot further away than +6o) for the MO at +40.12 is far greater

Short term traders who are experienced could trade the wiggle room, but long term investors simply wait for an MO below -60. Be patient it will come.

Positions

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

Current positions .

• EWZ (Brazil – 10% of portfolio position) Bought at 69.80. Currently at 71.12. – 3 times its been up close to 4% in the last few trading days, but has failed to make the 5% profit figure originally projected to take profits. Sold 1/2 for 71.22 yesterday for a measly +2% profit. There is still some hope of building the remaining EWZ into a long term position, but its fading.
• TYH (3x technology – 2% of portfolio position) Bought at 31.76 Currently at 32.26 Considering selling this position ASAP

In trading, one major key is to cut any potential loss and let your winners ride.

Long Term Outlook - NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

-

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.

.

Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

-

Nuclear Power

Editorial from Yankee Bob (bolding/color/format mine) in response to my including nuclear power as part of comprehensive energy plan that focused on alternative sources.

Why the hell would you support Nuclear energy??!!

There is no more expensive way to boil water then Nuclear. It’s the most expensive way to produce power when you consider the social costs.

• The deaths from radiation releases that are routine and routinely labeled as safe render it a loser.
• There is no safe place to store the tons and tons of waste unless you’d like to store it under your bed!
• The waste has to be shipped via truck or rail around the country. Sooner or later there will be a deadly accident or terrorists will hijack it.
• The waste will be deadly for 100s of thousands of years. Nice of us to pass the risk on to future generations.

If nuclear is so wonderful,

• why does the industry need the government to guarantee loans so reactors can be built?
• Why does the taxpayer have to assume the risk and get stuck for the tab even if they never produce a watt of electricity??!!
• If Nukes are so safe why does the government have to insure them because private companies won’t?
• What happened to the market place providing solutions?

This new nuke tech they are planning on building does have design problems and has not yet been certified by the regulatory agencies. It’s nuke industry propaganda that is touting their safety,no one else. when was the last time cost analysis factored in the cost of decommissioning a plant? They don’t! What is the cost of the public subsidies for guaranteed loans and gov insurance?

By the way,if you have a meltdown and lose a whole state,do you really think the gov will pay off on the loss of property to common citizens or just corporations? Why can’t we apply an equal amount of public subsidies to good clean solar or wind or geo thermal?

And lastly,without Homer’s Nuke plant making piles of plutonium and where would the weapons industry be. First ,they depended on it for making nuclear weapons and now they make a s–t load of the enriched armor piercing stuff that we have littered Kuwait and Bosnia and especially,Iraq with and it’s probably responsible for the Gulf War Syndrome. Why would you be in favor of Nuclear power? Eventually,we will lose a city or a state.

A shorter rebuttal from John Sovjani

Bob; I think nuclear should be part of the solution. Japan and France get most of their electricity from it. As Tom Freidman has said, we invented and developed it and now other countries are taking it and running away with it. If subsidies weren’t given, which energy tech would succeed in the market place? Also, which technologies do we have now that are proven and how long it will take any of these to have a significant impact without subsidies? Was it 10 years for approval for windmills off Cape Cod?

Have an opinion? Let it be heard in the comments section of the blog Nuclear energy, Immigration & Fixing Shadow financials are the latest topics – but anything goes.

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

From Monday – “Sell in May and stay away” an old Wall Street saying.

This is the third or fourth “Distribution” day for major US indexes. Distribution = big, increased, above average volume associated with a major (biggest since 2/4) selling day. Technically 3D days (a pun) is about as big a signal of a market reversal there is, especially when rally days have so little volume. = BEARISH

Technically almost every analyst sees two major obstacles – We reached a “Fibonacci retracement number for the benchmark S&P 500. and US markets are at the place they were before the Lehman Brothers meltdown sparked the massive selloff. = Bearish

This added to a roller coster markets (up, down, up, down), which usually indicates a top has the boys and girls who live by technical analysis running for cover. = Bearish

Lots of analysts specifically  blamed yesterdays massive selling on Greeks who protested austerity measures as conditions for loans. They like most American want to see the Greek bankers pay more. The demonstration was the small picture. Markets selling off so much on this relatively minor news = Bearish

The real problem is in all the PIIGS in Europe got nailed when their bank, like ours were got over leveraged. There are other causes but  over leveraged loans have played a huge role across the world = Bearish

The Dollar (see below) is a major fundamental problem to recovery. As the dollar moves higher two negative factors come into play

• Oil prices, tied to dollar, also move higher. May & June historically have been period oil prices increase before summer driving season.
• US exports cost more abroad, because the dollar is more expensive and this cuts profits. = Bearish

Analysis - Big red bear paw prints all over the place. (see above) This time a low volume rally is probably just not going to cut it and traders will sell into the rally.

About the best hope to stem the tide is improvement in the employment numbers on Thursday. We also have a strong earnings season = Bullish

However, What Investors see, impacting those strong earnings is

• Higher gas prices
• Higher costs to export goods
• Continuation of European debt problem
• No solution American shadow banking problems.

Perhaps we will get a weak volume rebound today.  However these weak volume rebounds are on very thin ice when traders see such massive volume behind sell offs. So the roller coaster ride is probably going to finish where many coasters do – down from the top.

1168+ The 50 DMA & 1150+ (an old high) are two major support levels on the benchmark S&P 500 now at 1173.60

Significant Indexes

• McClellan Oscillator fell dramatically  to -46.43 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – The MO broke through a strong support level at -33 support level. Breaking down through support almost always means there is more downside to come.  However support levels do put up resistance to further falls.
• US Dollar – Had a HUGE breakout and was up +1.16% yesterday. [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important Dollar closed at $83.83. The breakout of the trading pattern to a new high for the dollar focus almost all eyes on the growing value of the US dollar. Rising dollar almost always = falling stocks. The dollar is rising and falling because of the fluctuations in European currencies = Greek debt.

Positions

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

Caution – From Monday -The stocks in  YOUR Stock list are especially vulnerable to a sharp correction in the market.

Caution – From Tuesday- More and more US equities are looking like they have reached at least a short term high.  The jobs report on Thursday is critical to advancing markets.

Long Term Outlook – In anticipation of the S&P 500 (click on link to chart at side of blog) breaking through its 50 DMA the long term outlook is going to get downgraded to NEUTRAL.  This may be jumping the gun,but the momentum is with the bears.

YOUR Stock List from last Tuesday. Right now because all stocks could be taking a major correction it is far more significant to focus on the  BIG PICTURE than individual stocks.

Yesterday Investors sold 1/2 of its EWZ position (Brazil) that was bought  many months ago for a profit. The last 1/2 is down from where it was bought. This leaves Investors411 with under 10% position in stocks. (See positions section) Holding onto long term positions in IMAX & ESRX

The good news is as the McClellan Oscillator falls (especially below -60 = Oversold) Investors411 will start buying/nibbling again. Hopefully, more on this tomorrow. What too look for are stocks bucking the trend. (more tomorrow)

Note 2/4 was the last time we had a bigger than yesterday’s sell off and that’s 7 days before Investors411 started to buy. – We all had a good run then. Let’s hope the same pattern sets up.

Long Term Outlook = NEUTRAL

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

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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

Behavioral Economics

Nobel Prize winner Daniel Kahneman is “widely regarded as world’s most influential psychologist” who is also the father of Behavioral Economics. “The Riddle of Experience vs. Memory.” is a very powerful & worthwhile video presentation on understanding why/how your perception of happiness and pain are impacted by memory vs. experience.  The Q&A at the end is especially significant.

From stocks to politics reality is one thing but how you experience that realty determines your action. Investors411 has reference Kahnenman in the past and will in the future.

Millions in America are addicted to pompous windbags screaming and ranting. Kahneman has scientific and logical insight into something that might actually help make you HAPPIER.

Make Markets Be Markets

In less than 18 days we handed out almost $800 billion to financial shadow institutions. In 18 months of the Bush & Obama administrations we have done nothing to fix the problem. The Roosevelt Institute featured a conference on financial reform with perhaps our best hope for some sort of protection Elizabeth Warren as one of the feature speakers.  Lots of other significant personalities attended

Health Care’s Last Stand

Here today’s NYT Editorial on health care – “Congressional Democrats can either move forward legislation to fix this country’s broken health care system or throw away a once-in-a-generation opportunity.”

Many of you over the past year have posted comments on this. Including the last one from Popeye (a public option supporter) who thinks “we are kicking a dead horse”

Personally, this legislation does not “fix” health care – it is way too watered down. But, the NYT is right – you will see no significant reform for a generation if it does not pass.

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 over weekend. (No changes this weekend)

Another day that saw stocks rally and fold at the end of the day. Investors are selling into the rallies because the general market conditions are oversold. = Bears taking over.

The big data point is tomorrows jobless number.

Investors clamored to buy Greek debt. Good news for Greece and European Union. But this problem is far from over.

Overbought markets can be very sensitive to bad news.

Significant Indexes

• McClellan Oscillator fell to +54.74 yesterday We are now just below +60 or Overbought territory. Still time to seriously consider selling into any rallies.

Positions

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

• recently bought (added to) EWZ (Brazil) was sold at 72.00 Sold the shares bought on 2/11 for 65.75 Still holding onto shares bought last year at 59.5.  @+6% profit
  
• IMAX – Sold 1/2 the shares when it hit stop/loss order at 13.4.  @+6% gain. Wish I had sold earlier into the rally as I suggested.

Investors411 has sold the rest of TYH. & 1/2 of MOO, EWZ & IMAX. Will sell more positions if McClellan rises significantly. Plan to buy if it drops. Will probably buy some at $NYMO (McClellan Oscillator) reaches zero.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING