Bernanke

The Fed’s First Press Conference

This was THE EVENT and hyped in financial circles almost as much as ” the Pope on SNL”. It’s big.

The Fed set’s interest rates, makes huge loans to big banks, buys treasuries, and basically prints money (purists would say the Treasury does that) Many argue that Bernanke, like Greenspan before him, is the world’s most powerful individual

Some Reviews of Bernake’s speech links

Some Results

  • Stocks moved higher
  • Gold/silver moved much higher
  • The dollar fell
  • Obvious applauds for being more transparent
  • No big surprises

The press conference, of course, did nothing to change hardened critics and advocates of the Fed. Bernanke is probably very happy with outcome.

Some  major points and comments.

  • He stated -” QE #2 is ending June 30th.” PERIOD. Opinion - If things go badly there will be more liquidity injections (QE#3) perhaps at the longer end of the yield curve (longer term treasury bonds) to help mortgage rates.
  • He compared 2008 dollar lows to todays low and said the period the dollar went up in between was just a flight to quality. Opinion – Although the Fed talks a strong dollar they would allow it to go much lower. Many ramifications here, but bullish for US stocks, and very bullish for gold silver.
  • He moderately lowered GDP outlook for USA. Opinion – He’s right
  • A little bit more hawkish on inflation, but stated commodity “account for pretty much all” of the increase in inflation and focused on other reasons than Fed policy is not responsible for inflation. Opinion – There are other reasons like revolutions and a growing emerging market demand creating inflation, but the falling dollar adds to this, especially abroad.

There was good, bad and ugly side of this and every speech. Some of these details will be worked out over the next few weeks.

The bottom line just for investors – It’s bullish for US stocks, gold/silver, and commodity prices

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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

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Index Percentage Volume
Dow +0.76% down
NASDQ +0.78% up
S&P 500 +0.73% down
Russell 2000 +0.62% -

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Technicals, Fundamentals & Analysis

Investors411 record - 6 years of beating benchmark S&P 500

  • The dollar fell again to another a three year low.
  • Now a mantra US dollar in clear long and short term bear run. – Good for US stocks, gold/silver and most commodities. in short term.
  • Since November Investors411 has beat the drums for bulls because of the Fed zero interest rate policy and injection of liquidity (QE2) This continues.
  • Some Reviews of Bernake’s speech links – Financial Times,  Seeking Alpha, & Reuters

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Shorter Term Forecasting Indexes

There are hundreds of forecasting tools, – These two tools have worked

When they stop working Investors411 will use other Indexes

  • The Dollar (USD) [Any daily price move over +/- 0.50 is significant. Dollar usually moves inversely to stocks] -0.43 yesterday. Another a three year low. Clear longer and shorter term bearish trend. For US stocks = Bullish
  • McClellan Index(MO) [The very rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks .] Fell to +36.71.  Getting up there but still = Neutral

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Reading The Tea Leaves

What to watch today

  • UUP - (Tracking ETF for dollar) Remember - Usually the dollar is a contrarian indicator for stocks. Any major fall may give temporary help to US stocks, but a major breakdown also signal major structural problems with the USA

From yesterday -  ”the call is Bullish across the board…&…It may be that a 10% correction in silver (SLV is the ETF) is all the correction we get. ” Silver/gold exploded higher, stocks rallied and the dollar fell.  YSL #4 should continue to outperform.

FutureAnything that holds onto most of the gains yesterday is bullish today. The dollar trade has easily become the most critical factor influencing equities and Fed manipulations are sending the dollar down. SLV is a juggernaut. Congratulations to all still holding SLV or AGQ.

Since QE2 began Investors411 has been far more bullish than most investment sites

This accurate policy will continue as long as the dollar gets devalued by Fed manipulations.

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Paul’s Corner

You can read Paul’s daily remarks in the comments section of the blog. Here’s his outlook on stocks

Well well well what an interesting day. That over sold rip off of a dog SLV comes in with a 5% gain after Bernanke indicates he will continue to give away the farm to the banks. Watching the last hour or so of SLV trading  it’s sure looks like the black box traders are at the controls.

-  21% (315) of the S&P 1500 stocks are now in an over bought condition, but we  are still a wee bit away from a market peak.

- Many of the oil related stocks took a hit at the open when Conoco Phillips missed estimates because of trouble in Libya. I sold NBR at the open, they reported last evening and missed estimates for  the same reason. By late afternoon many of the oil stocks did recover, but it looks like some damage has been done.

The top group in my high demand search was the  Health-Bio/Genetic group with 10 % of the top 100 high demand stocks for April 27. Here is the list, sorted in alpha order:

Health-Bio/Genetic (10.00%, 10 securities)

  • Amgen  Inc. (AMGN)
  • Biogen Idec  Inc. (BIIB)
  • Celgene Corporation (CELG)
  • Cubist Pharmaceuticals  Inc. (CBST)
  • Incyte Corporation (INCY)
  • InterMune  Inc. (ITMN)
  • Momenta Pharmaceuticals  Inc (MNTA)
  • Regeneron Pharmaceuticals  I (REGN)
  • United Therapeutics Corporat (UTHR)
  • Vertex Pharmaceuticals (VRTX)

Second group  was the semis.

Semiconductor-Mfg (6.00%, 6 securities)

  • Altera Corp. (ALTR)
  • Atmel Corporation (ATML)
  • Cypress Semiconductor Corpor (CY)
  • Entropic Communications  Inc (ENTR)
  • Microchip Technology  Inc. (MCHP)
  • Taiwan Semiconductor Manufac (TSM)

ALTR is a YSL 4 member and you could have bought it last week sitting on the 50 and you would have a 13.4% gain! (SLV has had a 9.3% gain in the same time frame so don’t think you have to chase the latest fad!)

None of the “Oil” related stocks made the top 100 list so it does appear we have some rotation going on. Many of the semis appear to be raising from the dead.

All of the major indexes finished up with gain,  the color “green” is the predominate color on the various HGSI spread sheets, positive earnings reports are coming in  and Bernanke turned on the faucets again. Happy days are here again?

Disclaimer: Please see below……

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

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Positions

SeePOSITION“ section of blog (at top of page) for lists of potential stocks & ETF’s including “YOUR Stock List.”

Disclosure - I have personal  positions in REMX,  SLV (smaller), DGP, UWM, RJA and manage a fund that has a 5 year position in GLD

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Longer Term OutlookCAUTIOUSLY BULLISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

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