So at least the market is making higher highs and higher
lows. With this week's FOMC policy statement on
Wednesday - will see if the same can be said next week.
The Fed at 2:15pm on Wednesday will
let all know if they are going to cut rates one more
time. On top of that all will be carefully looking at
each word in the statement. If there is a hint that this
is the end of rate cuts we could see a sharp reaction in
the markets so don't be taken off guard.
The chart of the day shows how the
market (S&P 500) historically performs much better from
November through April. This month has been very good
compared to the first three months of the year but
earnings season will soon end and the fed will announce
this week its rate decision and the catalysts that seem
to have been moving the market will not be as plentiful.
I read that on average the Nasdaq has been up 56% of the
time in May but the average gain is only 0.4%. A coin
toss there.
New home sales totaled 526,000 during March, declining 8.5% month-over-month.
On average, economists expected sales of 580,000 units for the month.
The median sales price of new houses sold in February was $244,100, while the
inventories of new homes at the end of February was 471,000, which represented a
supply of 9.8 months at the current sales rate.
The performance for the week of the major indexes.
The weekly top and bottom sectors:
The top and bottom industries
for the week:
The Hubble space telescope was
launched in 1990 and has returned some really amazing
images. Hubble can see back in time as the light it
sees has been traveling so long. It can see somewhere in the neighborhood of 20
billion light years into space (known as "the observable
universe). That would be about 120,000,000,000,000,000,000,000
miles. "The light from these faint stars
is so dim that it is equivalent to that produced by a
birthday candle on the Moon, as seen from Earth," said
lead author Harvey Richer, from University of British
Columbia, Vancouver, Canada.
Here is an image that is really
outstanding.
The Sombrero Galaxy -
28 million light years from Earth - was voted best
picture taken
by the Hubble telescope. The dimensions of the galaxy,
officially called M104, are as spectacular as its
appearance. It has 800 billion suns and is 50,000 light
years across. (good place for a killer suntan)
Hubble Telescope launched 1990 James
Webb Telescope to launch 2011
To celebrate its 18th birthday,
fifty nine new images
of colliding galaxies were just released making up the
largest collection of Hubble images ever released
together. They can be seen at these links:
http://spacetelescope.org/news/html/heic0810.html
Merging Galaxies
http://www.spacetelescope.org/goodies/mergingGalaxiesSite/mergingGalaxies.html
Here are two of those images:
NGC 5257, NGC 5258
Arp 240 is an astonishing galaxy
pair, composed of spiral galaxies of similar mass and
size, NGC 5257 and NGC 5258. The galaxies are visibly
interacting with each other via a bridge of dim stars
connecting the two galaxies, almost like two dancers
holding hands while performing a pirouette. Both
galaxies harbor supermassive black holes in their
centers and are actively forming new stars in their
discs. Arp 240 is located in the constellation Virgo,
approximately 300 million light-years away, and is the
240th galaxy in Arp’s Atlas of Peculiar Galaxies.
With the exception of a few foreground stars from our
own Milky Way all the objects in this image are
galaxies.
NGC 6050
Arp 272 is a remarkable collision
between two spiral galaxies, NGC 6050 and IC 1179, and
is part of the Hercules Galaxy Cluster, located in the
constellation of Hercules. The galaxy cluster is part of
the Great Wall of clusters and superclusters, the
largest known structure in the Universe. The two spiral
galaxies are linked by their swirling arms. Arp 272 is
located some 450 million light-years away from Earth and
is the number 272 in Arp’s Atlas of Peculiar Galaxies.
Now to the charts - we start with a point and figure chart of the Dow
showing a 3 box reversal with the automatic chart formula suggesting a target of 13800.
And a monthly Dow starting
in 1981.
The daily Dow shows it is
at or a bit above the 38% retrace and trend line.
It is well above the 200-day EMA, over the 80 line on stochastics and within the
Bollinger bands.
The DDM chart an ETF for trading the Dow movement with its goal to make
200% the moves of the Dow and it did that on Friday. This is still under its 200-day
EMA and at resistance.
The Dow Transportation index made a new high for 2008 on Friday. So did
oil - go figure. Note the golden cross that happened this month as the 200-day
dropped under the 50-day. A bullish event.
The Nasdaq weekly chart shows it about 35 points under the 50-week EMA.
And on the daily we see the 200-day and trend line just above at the same point
as the 50-week above.
A closer view. It is a bit troubling that there are two gaps below as there are
high odds that at least one will fill - that at the 50-day EMA.
The Nasdaq bullish percent index is now above the lower range line. This
is where it needs to be to stay in this current bullish bullish trend cycle.
The Nasdaq 100 is about the same as the full Nasdaq chart but it is already over
its 200-day EMA.
The semiconductor index SOX weekly chart has pierced resistance and
closed near it as stochastics touches 80. In all cases on this chart since 2003
stochastics has continued over 80 for some time before falling back and this as
yet has not even fone over 80.
The S&P 500 monthly has had a good bounce but back to resistance at the
20-month EMA it may break a bit above but this may be a shorting
opportunity soon. As mentioned last week - would prefer to see stochastics
bottom under 20. RSI closed a bit above 50.
This S&P 500 weekly chart shows only the 13-week and 34-week EMAs.
It is bullish when the 34-week is under the 13-week and of course when the MACD
is above the 0 line.
This daily chart also shows the 200-day, trend line and 38% retrace all acting
as resistance at the same area.
And the close up view with a new high since the first part of January.
Our bullish percent gave an S&P 500 buy over a week ago and it is still in play.
On the S&P 60-min chart it shows the close just a tad over the resistance
line.
NYSE at clear resistance.
The number of stocks on the NYSE
over their 50-day average not yet overbought.
The Russell 2000 looks quite
good. We have had light volume so only a boost there
could take this to the 200-day at 740.
Oil is a bit over our 116 target
as momentum is still in force so news can move it pretty
easily. There will be a pullback - cannot say when
exactly.
And the US oil fund of course
continues higher.
Gold continued lower
loosing 2.8% this week. A bounce may cause the
stochastics to go back over 20 but sometimes this is only a
quick move.
The intermediate term gold price targets. There was a doji on Friday so it could
make a little reversal on Monday.
Silver has a small hammer
candle which may point to a bounce. Longer term the
200-day is likely to be tested.
The XAU gold and silver
index bounced at the lower trend line and 200-day EMA as
it has done before. Do not think that gold stocks in
general are at good entry points. Selectively for short
term may turn up some.
I read somewhere a mention of this so made a chart. You know that the VIX
is often referred to as the Fear gauge as it goes up when investors are nervous.
It had been in a bull tend up for a long time and in reverse, correlating the
10-year bond yields TNX were going down. Now the VIX has broken its
trend line and yields are rising. They closed on Friday at 3.86% When investors
are worried they move money from stocks into bonds and that causes the rates to
fall. Now there seems to be a bit more confidence and as money moves out of bonds,
bond prices fall and rates go up. The lower part of this chart is the TNX
10-year yield.
This is the TYX 30-year bond yield now at 4.59% and at resistance so may
pullback and we would see a rally in bonds and that often means a decline in
stocks.
The EURO to Japanese Yen
ratio chart reached resistance and fell back as the US
dollar rallied late in the week.
Here is the Yen on its own as reference. Now near
the 38% retrace.
The US Dollar long term
And here showing how the USD broke out
of the triangle at about the correct spot - 2/3 along
the way toward the apex. We have two eventual possible targets
show.
We looked at many Dow Jones sector charts. Obviously many
were at high levels after big rallies this year. Those
related to commodities and energy. We were looking for
some that may move if we get a better volume move in the
markets as high volume shows better commitment.
The financial sector XLF is one that has broken
above the trend line though for obvious reasons caution
is advised to pick carefully.
Electronic
Equipment broke above it multi-month range on
Friday.
And Electrical Components is
near and at resistance but could also break out.
Telecommunications
Equipment has a similar chart.
A surprise to me was that
Clothing and Accessories also broke above its range
on Friday.
Automobiles and Parts is
also a sector to pay attention to.
|
Butch Cooley Market Comments
(Butch is founder of
Leg Up House
and the
Butch Cooley Worldwide
Hunting and Fishing . He has
been an active trader for decades.)
Market Comments April 25, 2008
Not a bad week for equities. There was all kinds of
stocks moving this week, and lots of money made. So the
“slump” must be over, and the markets are back in rally
mode. Not!!
Oil is flirting with $120. Wonder
where it will be next year at this time? Maybe $200 a
barrel? Gasoline is at all time highs, and in many
states $4 a gallon is the norm already. Lower income
families are already choosing between food and gas.
Hard decision to make. Maybe we should learn to drink
gasoline, as I think it’s cheaper than milk.
And still the banks and brokerage houses won’t come
clean. I made the comment in August we would not get
out of this credit mess without a few failed banks. 9
months now, and I am more convinced than ever this will
be the case. And it will not be the local bank around
the corner. It will be a “biggie”. We have already
lost one brokerage house and I don’t see why we can’t
loose a few more.
And when was the last time we heard anything about Ambac
and other bond insurers? Well, insurance companies are
still in their own private hell. Stands to reason we
will see one or two of these dry up. And then there is
the US Dollar. Wow!! Helps with exports, and of course
offers some balance in our trade deficits. But this
policy only works for the shorter term. The truth is
it’s killing our own domestic economy. To me, it’s an
unacceptable trade off. Throw in housing and some
inflation, and you have to wonder.
So why are the markets up again, and everything else is
so bad? Well, it’s simple. We don’t have all the facts
yet. The grenade went off, but the smoke just doesn’t
seem to clear, so we can’t really see how much damage
there is. But trust me on this. I’ve been trading for
45 years. The current economic indicators are probably
the worst I have seen in all those years of trading.
It’s just not going to end well.
So, by all means, get in on the rallies while the
getting is hot. But be ready to get out just as fast.
I don’t trust these markets at all. I believe we are in
for a reality check sometime soon.
BC
|
Weekly economic calendar from briefing.com - a lot of
items this week that could spur the market.
When any of
you sign up for a new
stockcharts.com
accounts there is a space to put in a referral
name on that form. If you enter
stocktiger@stocktiger.com they give us credit.
Thanks!
Stocks of longer term
interest:
NNRI NNRF Inc on Monday
filed notes about its recent 10K filing and its success
as well as the expectation to book revenues in the first
half of this year from its technology products.
NNRF, Inc. Announces 10K Filing
for the Fiscal Year Ended December 31, 2007 Income From
ZAO ATOLL $5,662,717
The
company this week announced that the German Government has awarded NNRF $225,000 in relation to its Feecom/Biecom
materials. NNRF is currently producing "bricks" of these
products for installation for a major nuclear power
plant operator as the company announced previously. They
are using loaned equipment as new equipment is expected in May. This
grant will help in the costs of this equipment and to
provide funds to formulate an additional proprietary
line of Feecom/Biecom to meet some new specifications.
In my opinion the significance is not so much in the
$225,000, though this is very good, but in the
confidence it demonstrates the German government has in
NNRF. The grant was issued as part of the European Fund
for Regional Development so it is obvious that they
expect the outcome will be in developing a new line of
products to be produced there so they in effect have
implied their need for this product.
NNRF, Inc. Announces German State
Funding Grant of Approximately $225,000
PLTG Platina Energy Group had an announcement of
the Oklahoma production for the month. The stock has had
some wide swings. It also trades on the German exchange
and there is quite a lot of arbitrage. They are building
both oil and gas production each month.
Platina Energy Group Reports
Oklahoma Production for Beginning of April
PYR.v Pyramid Petroleum sold one of its
Canadian properties and bought an additional producing
one in the Gulf of Mexico as they continue to build
assets there. A week ago Pyramid announced a drilling
program in the gulf of Mexico that they expect will add
about 800 BOEPD (barrels of oil equivalent per day) to
add to their current 1300 BOEPD for a total of 2100
BOEPD. By the end of 2008 they expect total production
to climb to 3000 BOEPD. Using a $100 per barrel of oil
that would be about $9 million per month. The stock is
till near the all time high but seems it is at a very
attractive price as this professional company is
expanding production yet it is trading far below its
peers as it is on the TSE Venture exchange so not yet
well known.
Pyramid Petroleum Sells Minor
Interest in Montana and Alberta for $6.3 Million
Pyramid Petroleum to commence a
four well exploratory drilling program in the Gulf of
Mexico
CYRX Crypoprt has a PDF file now on the FedEx
site to promote the
One-Way Shipper System.
CryoPort, Inc. Announces FedEx
Sitelet Now Live
http://fedex.com/us/asvm/cryoport31388.pdf
GWDC Growers Direct Coffee Company outlined
the changes in officers and the departure of Shailen
Singh which has been known about and looked forward to
for many months. So in my opinion this was a non news
item. They will soon open their first coffee cafe in
China.
GROWERS DIRECT COFFEE COMPANY,
INC. Files SEC form 8-K, Change in Directors or
Principal Officers
New additions for the watch list:
VNDA Continuation over 50-day EMA at $4.00 or on
pullback staying above the trend line.
SFLY Maybe overbought but good volume
may run it again over this $17.00 level - $17.60 was
the Friday high
GTE Over $4.40
PFWD This kind of gap may hold with stop
under 200-day at $18.00 - will have to see how it opens
JBHT Over $33.80
HCBK Over $19.15
though caution first 15 minutes Monday as it is so close
ANN Over $26.56 on good volume
GGP Over $43.10
ELN Over
$26.90 or $27.00
SGMS Over $27.70
WFSL Over
$24.51 and top level over $25.00
TZIX Watching - maybe a short under
$20.30 or $19.70 - depends on volume or a long on
improving volume back over $21.12
XRT The is the retail sector ETF a triangle
break would be over $33.75
Photograph by:
tet leoned
Photograph by:
tet leoned
Photograph by: Alexei Rudnitsky
Happy
Birthday Hubble. 18 years in space - more on that later.
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