So far the Nasdaq is only
testing the top channel line though if it breaks, the 50-day
EMA is the target support.
The SOX semiconductor index actually does not yet look bad. The
stochastics are again below 80 but not what you would call a ruined chart.
A close view of the S&P 500
and the Fibonacci retrace lines and now close to the 200-day.
The longer view of the S&P 500 shows the 200-day EMA and
trend line and the RSI near 30.
THE S&P 500 monthly chart shows the break of the RSI under
70. It may go back up as it did in 1998 but a test of the 20-month
EMA could be in the cards in the next couple of months.
The percentage of stocks in the S&P 500 that are now above their
50-day average in the oversold area not seen too often. This at
least suggests a short term rebound.
This chart is a ratio of the
S&P 500 to the Russell 2000 and shows how the relative
performance of the S&P is out performing that of the Russell. If
this continues - (as long as the break out holds) one could stay
short the Russell and long the S&P in equal percent/payment lots and
make money if the market goes up or down. A nice spread play perhaps
using futures.
The Russell 2000 broke below the 50-week EMA and we will pay
attention to the channel trend line. If that fails then the 200-day
is the target and the summer 2006 low.
Would expect that the NYSE would drop a bit more to
test the channel bottom at the 200-day and the 62% retrace. The
negative divergence on the RSI pointed this drop out as it is not
rocket science. Note the RSI is again at 30 and stochastics under 20
so will watch for a turn back up this week.
The percentage of NYSE stocks trading above their 50-day EMA at levels seen once
in 2005 and again in 2006
The number of NYSE stocks trading above their
200-day EMA has dropped sharply since the first quarter high and is
near a trend line. Do not really know if trend lines work on this
chart so lets watch and see. On the lower section of the chart is
the NYSE and it is near the blue trend also.
The NYSE high-low index is getting into the oversold area that in
the past has produced at least a bounce.
Before the invention of the inverse ETFs this ProFunds Ultra
Short Small-cap was one way to go long when the market was
pulling back. You can only put in your order one day for a buy or
sell the next day. Since 2003 when the rally started this has not
been able to break above the 50-day EMA so it is worth watching as a
break here may set off a longer term market pullback. The
stochastics has risen above 20 and not yet to 80.
The 30 year bond yield
pulled back to the trend line and bounced to the 200-day EMA as the
RSI hit 30 so it may now start back up?
The 10 Year note yield ran to the trend line
and horizontal break out and pulled back.
We have not looked at the yield
curve in a while but it has again become inverted as it becomes when
it is below 10 on this chart. Perhaps that recession will come.
Oil has almost made it to
its high of 2006.
Gold tried to test the April high and failed
as the stochastics dropped below 80 for a sell again. YOU can trade
this using the ETF symbol GLD (it trades at 1/10 the price of
gold) and this chart has been quite accurate at giving good buy as
sell signals for a couple of years. The US dollar may have put in
its low and told has been at times trading inversely to the dollar.
The US Dollar broke below
the 2005 low but rallied back up above it and the could turn out to
be the final longer term low.
Now for some story stock information. These are
companies that have a story we have written about are are either for
trading of long term investing with unique upside potential.
PYR.V This has been tiny volume
for many days as few seem to know of the company except some of us.
They make money and the financial filing will not be long in coming
as we expect a couple of cents this time and over $0.20 EPS in the
12 months so a good long term prospect with this one.
CYRX chart is unchanged though the
stochastics continues higher in front of the stock price as the move
to the OTC announcement still expected any day and then the start of
the news cycle on their progress. I like to accumulate weakness on
this as it jumps up so fast when it moves. If you wish to wait for a
break out - the bull flag top is at about $1.49.
CFPC The company has hired a PR firm so will
be better at putting out news for the shareholders.
Coffee Pacifica has strengthened itself in a very
positive manner and now has 3 coffee producing countries on board
and a forth to be signed up quite soon. Expectations are for strong
3rd and 4th quarters in 2007 with
Papua New Guinea production, and 1st Q
2008 we could see some breakout revenues with high Papua New
Guinea production and Jamaica sales and revenues
beginning. Coffee Pacifica has coffee from Papua New Guinea,
which provides approximately 2% of the world’s premium Arabica green
coffee beans; Ethiopia, which has world-wide influence as the 6th
largest green bean exporter; and Jamaica, which has the best branded
and most expensive Coffee beans in the world. The company believes
it can strategically increase it’s exports up to 300,000 bags a year
of green bean coffee. You can add any time or on a break out over
the small trend at about $0.80. The company will have its
general shareholder's meeting in Las Vega August 8-9 and we will
have more details later. The company conference call should also be
available this week for listening too and we will post this on the
message board and the front page when it is. (actually the most
expensive beans are not from Jamaica but from Bandar Lampung,
Indonesi as these special selected beans go for $600 per pound. CFPC
does not handle this type of bean but thought you may find this an
interesting story.
PLTG This tried a break out at $0.51 but
some email stock picking sites picked it up and they brought in day
traders who bought the break out and when it did not continue they
sold their shares as they bought for a fast move so it sold off the
next couple of days. It is again near the trend line and 50-day EMA
so a lower risk area so scaling into positions on weakness can give
a good cost basis while having stops under support. The natural gas
wells in Tennessee will be drilled when permitting is done and this,
the drilling and the connecting them to the pipes will in total take
2 months or so and could be 3 months to start seeing the revenues
however the stock price will likely advance before the first of this
revenue. The Texas oil wells are being drilled and this also has a
close time frame. Keeping an order in place may get you some shares
on any intra-day weakness. I would guess that the next try of a
break out will be more likely to hold.
NPWS This one still offered no trade and
stochastics still falling. We are watching though as this may set up
as their prototype is still expected in the next couple of weeks so
it may spark interest.
NNRF made another
significant move up on good volume. In 6 days it gained 100% from
the low and Friday pulled back a bit on lower volume. The support
should now be the 200-day and the next resistance at $4.24 which is
also the 62% retrace. Above that is the trend line and 50% retrace
at $5.00 and $5.30. The blue arrows show how after a high volume
move up the stock pulled back for our favorite 3 days on light
volume then took off again as stochastics went above 20 and RSI over
30. The chart is really shaping up and a close over the 50-day EMA
would reaffirm the recovered pattern. Later this week on the message
board I will start a little contest to pick the date that this will
again hit $10.
Economic calendar form briefing.com
Now some additions to our watch list both long and short. Note that
many of the short candidates have fallen several days in a row so
will bounce at some point. In some case a short entry may come after
a bounce. Keep tight stops to not get into any short squeeze. In the
past the markets have had strong rallies from oversold conditions as
we have now so remember to takes some early profits then follow with
stops to keep your profits on any short positions.
WMAR Over $15.00 or the 200-day EMA at $15.16
VCLK Under $25.95
TIF This triggered on Friday but it is a
continuation now under $47.90. As with many here - it is down many
days in a row so a bounce can come at any time.
OC Under $29.92 is the Friday low. This
may be a reversal candle.
OCR Below $32.20
NOVL Below $7.00
NTAP Under $28.50
NSM Under $25.50
MDT Under $49.88
LAVA Above $15.70 is the top break out
but aggressive trades may enter over $15.00 it seems.
JBLU Under $9.95
IVC over $19.53 - $19.65 shadow
BLTI Over $7.00 or $7.24 and 200-day.
NLY $14.72 was the level break point but
it gapped up and used up its power though closed above the 50-day.
The next try may be a buy but aggressive traders may want to enter
lower as the volume suggests another try.
AMR under $25.00 - $24.88 is a shadow
low
ABY under $2.35 but volume decreasing so
also a bounce may be in the making here.
WSM This may bounce but under $30.60 would be
the new low.
INTC under $23.28. They may have some lay offs coming and it
could spark some more selling - or not.
Summer flower boarder
That's a full lid for today - will see you all
during the week.
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