1:05pm (EST)
There was little doubt the market was going to test resistance levels again today as futures were showing a strong start to the session. Most of the good news came from across the pond as a number of European banks reported better-than-expected earnings and strong PMI data had Wall Street giddy.
The bulls also got a lift after the ISM number came in above expectations. The Institute for Supply Management reported its manufacturing index fell to 55.5% in July from 56.2% in June. Analysts were looking for a reading of 55.0% and anything over 50% indicates growth. Another sprinkle of good news came when construction spending for June showed an increase of 0.1% versus the 0.8% decline that had been forecast.
As a result, the Dow is enjoying a 176 point pop, or 1.7% and is at 10,642. The S&P 500 is up by 21 points, or 1.9%, and is trading at 1,122. The Nasdaq is higher by 34 points, or 1.5%, and was last seen at 2,288.
The Dow has pushed past the 10,600 level and is eyeing 10,800 but we are more concerned with the S&P 500 and Nasdaq as they give a better snapshot of a wider range of industries.
We said in our Weekly Wrap that the upside would be 2,300-2,350 for the Nasdaq and 1,125-1,150 for the S&P and as you can see we are once again right at the first wave of resistance. Perhaps the game-changer will be Friday’s unemployment figures but until the bulls break through it’s hard to jump on their back. It’s also frustrating to side with the bears as they have wasted some good opportunities to get back to middle ground.
One stock going through the same pressures as the market is Research In Motion (RIMM, $56.63, down $0.90). Shares were rallying ahead of Tuesday’s launch of their new, touch smartphone, but are down today after the Mideast said it might suspend use of the device over security concerns.
To make a long story short, the company has until mid-October to come up with a fix for securing encrypted messages but the countries only account for 3% of its total subscriber base. However, if the new BlackBerry 9800 Slider fails to impress users and the threat of other countries following suit with a ban, then RIMM could be in trouble.
There is room for two or three dominate smartphone makers/ providers in the space and RIMM will likely settle for third place once the dust settles. Apple (AAPL, $262.25, up $5.00) and Google’s (GOOG, $491.33, up $6.48) toys are head-and-shoulders above RIMM’s devices and the company is simply playing catch-up.
We have a lot to cover in our Members Area so let’s get on it. We will be back in the morning with another full update so stay tuned.
Tags: AAPL, Apple, call options, GOOG, how to trade options, momentum options trading, Momentum stocks, option picks, option stock picks, options alerts, options newsletter, options track record, put options, Research In Motion email outage, stock options trading, volatile options
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Bulls Rally to Resistance/ RIMM at Crossroads
1:05pm (EST)
There was little doubt the market was going to test resistance levels again today as futures were showing a strong start to the session. Most of the good news came from across the pond as a number of European banks reported better-than-expected earnings and strong PMI data had Wall Street giddy.
The bulls also got a lift after the ISM number came in above expectations. The Institute for Supply Management reported its manufacturing index fell to 55.5% in July from 56.2% in June. Analysts were looking for a reading of 55.0% and anything over 50% indicates growth. Another sprinkle of good news came when construction spending for June showed an increase of 0.1% versus the 0.8% decline that had been forecast.
As a result, the Dow is enjoying a 176 point pop, or 1.7% and is at 10,642. The S&P 500 is up by 21 points, or 1.9%, and is trading at 1,122. The Nasdaq is higher by 34 points, or 1.5%, and was last seen at 2,288.
The Dow has pushed past the 10,600 level and is eyeing 10,800 but we are more concerned with the S&P 500 and Nasdaq as they give a better snapshot of a wider range of industries.
We said in our Weekly Wrap that the upside would be 2,300-2,350 for the Nasdaq and 1,125-1,150 for the S&P and as you can see we are once again right at the first wave of resistance. Perhaps the game-changer will be Friday’s unemployment figures but until the bulls break through it’s hard to jump on their back. It’s also frustrating to side with the bears as they have wasted some good opportunities to get back to middle ground.
One stock going through the same pressures as the market is Research In Motion (RIMM, $56.63, down $0.90). Shares were rallying ahead of Tuesday’s launch of their new, touch smartphone, but are down today after the Mideast said it might suspend use of the device over security concerns.
To make a long story short, the company has until mid-October to come up with a fix for securing encrypted messages but the countries only account for 3% of its total subscriber base. However, if the new BlackBerry 9800 Slider fails to impress users and the threat of other countries following suit with a ban, then RIMM could be in trouble.
There is room for two or three dominate smartphone makers/ providers in the space and RIMM will likely settle for third place once the dust settles. Apple (AAPL, $262.25, up $5.00) and Google’s (GOOG, $491.33, up $6.48) toys are head-and-shoulders above RIMM’s devices and the company is simply playing catch-up.
We have a lot to cover in our Members Area so let’s get on it. We will be back in the morning with another full update so stay tuned.
Tags: AAPL, Apple, call options, GOOG, how to trade options, momentum options trading, Momentum stocks, option picks, option stock picks, options alerts, options newsletter, options track record, put options, Research In Motion email outage, stock options trading, volatile options
This entry was posted on Monday, August 2nd, 2010 at 1:05 PM and is filed under Company Commentary, Market Analysis, Market Commentary. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.