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Tuesday, April 3rd, 2012
9:00am (EST)
The bears had a slight edge going into Monday’s session as negative news from overseas weighed on Wall Street. The bulls were roaming on Sunday night as futures were up which lead us to believe Monday would be an up day despite the fact the indexes opened lower. We said in our Weekly Wrap and Monday Morning Outlook that we expect one last push towards our “fluff” targets and yesterday pop past resistance puts us halfway there.
The Dow gained 52 points, or 0.4%, to end at 13,264. The blue-chips made a triple-digit bounce off the low of 13,153 and traded to a high of 13,297. Our near-term target from January has been 13,500 which is only a 2% move from current levels. Support remains 13,200-13,000. Dow component, Alcoa (AA, $10.17, up $0.15) was up nearly 2% and will kick-off 1Q earnings season next Tuesday.
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If you are not a subscriber but would like to read more please click here. We have some super cool charts to show you today on the S&P 500 and Lululemon Athletica (LULU, $74.74, up $0.01). This week and next could offer big clues on if the rally continues or if the bulls are in for a big surprise.
Tags: AA, Alcoa Earnings, Apple, LULU options, LULU stock price, stock options trading advisors
Posted in Apple, Earnings | Comments Off
Tuesday, March 6th, 2012
1:15pm (EST)
We said March Madness would come early and that volatility would pick up in the market. Today’s weakness is all about the Greek debt situation, which is back in the front burner. There is a Thursday night deadline for Greece and its bondholders to come to an agreement over the debt bond swap in which the creditors would lose nearly 75% of their value on the bonds. It’s been nice not having to write about this situation for a few weeks but Greece is the word today.
We have spent a lot of time talking about the 5-week trading range we have been in and that there was a good chance this week that the market would move out of this range. We cited Wednesday’s Apple announcement of the iPad3 and Friday’s jobs figures as the two key events that would make or break the bulls push higher.
Often times when resistance is being tested, the indexes tend to overshoot these levels which we have been calling our “fluff” targets”. We said the Dow would move 1,000 points back in late November when the index was at 11,800 and we said the blue-chips would run into resistance at 12,800. We hit this mark in January. We also said if the Dow closed above this level there would be a chance at 13,000. If this level was cleared we said to watch for 13,250. To the downside, we said short-term support was at 12,900 and then 12,800 which is exactly where the Dow has been hovering. The index is currently down 193 points to 12,770.
We also said to look for a close above 1,375 for the S&P 500, which we haven’t gotten, and that if there were further weakness the bulls would need to hold 1,350. The index is down 20 points to 1,344 after opening at 1,363.63 which now bring 1,325-1,300 into the picture.
The Nasdaq is lower by 40 points to 2,910. Tech opened at 2,917and we said a dip below 2,925 would bring 2,900-2,850 into play. Here we are. Apple (AAPL, $529.07, down $4.09) is also lower and another clue we said to watch for.
The S&P Volatility Index (VIX, 21.55, up 1.98) is up 14% and above 20 for the first time since mid-February. This was another clue we said to watch for in Sunday’s Weekly Wrap.
We said there may be an opportunity to add a NEW TRADE or two today and that is what we are doing. Subscribers, check the Members Area for the updates and be sure to use limit orders to get the best fill prices.
Tags: Apple, iPad3, Nasdaq, Russell 2000, VIX
Posted in Market Analysis, Market Commentary, VIX | Comments Off
Wednesday, September 1st, 2010
12:30pm (EST)
The bulls used some overseas news to stage a big rally this morning while economic reports continue to come in mixed here in the US. Futures were pointing towards a strong open after China and Australia reported growth in their economies while a better-than-expected ISM number here at home added some extra gravy.
China’s said its manufacturing sector rose in August for the first time in four months while Australia’s economy grew by the fastest pace in three years during the second quarter. Meanwhile, America’s Institute for Supply Management’s manufacturing index grew to 56.3 in August from 55.5 in July. Wall Street had been expecting a decline to 53.0.
The rally has been a head scratcher for the bears given that the ADP report said private employers cut 10,000 jobs in the U.S. last month compared to a gain of 37,000 jobs in July. This doesn’t bode well for Friday’s “official” report on unemployment but the bulls don’t care. They are partying today.
The Dow is currently up 234 points, or 2.3%, and is at 10,248 while the S&P 500 is higher by 29 points, or 2.7%, to 1,077. The Nasdaq is showing a gain of 56 points, or 2.7%, and is at 2,170.
Resistance levels are Dow 10,200; S&P 500 1,070; and Nasdaq 2,150. These levels have obviously been “stretched” and we will have to see how the gains hold up into the close.
In corporate news, Apple (AAPL, $250.45, up $7.35) will be giving Wall Street an update on its product line and investors will be able to watch the event in real-time streaming video over the internet. We are expecting the company to announce an upgrade for the iPod touch which could include a camera with the same touch screen and operating system as the new iPhone4.
There is also chatter the company could roll-out a newer version of its iTV at a price of $99 which could jump start sales. It’s no secret Apple is negotiating with the big cable and TV studios for the right to rent their shows on iTunes which continues to grow at an incredible pace.
We will be back in the morning with a full update but are expecting Friday to be insane. The ADP report is usually a good indicator on what the numbers for unemployment are going to look like and the bulls could get sideswiped if they aren’t careful. On the other hand, today’s rally has been enough for the bulls to break key resistance levels and if they hold, the market could continue to rally no matter what Friday’s numbers are.
The key thing missing in today’s rally is the lack of volume…
Tags: AAPL, Apple, option picks, stock options trading
Posted in Apple, Market Analysis, Market Commentary | Comments Off
Monday, August 2nd, 2010
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
Posted in Company Commentary, Market Analysis, Market Commentary | Comments Off
Tuesday, July 27th, 2010
12:50pm (EST)
The market is mixed after getting off to a good start but less than stellar economic news has cooled the enthusiasm. Earnings continue to dominate the headlines but the bulls are having trouble breaking through the upper resistance levels we outlined in the morning update.
The consumer confidence report came in at 50.4 for July which was only slightly below expectations of 51 but down from last month’s reading of 54.3. However, to put things in perspective, the decline follows last month’s nearly 10-point drop, from 62.7 in May. This report takes a pulse of the American consumer on how they feel about the economy, jobs and their outlook and it clearly shows they are still holding back on spending.
Elsewhere, the Standard & Poor’s/Case-Shiller 20-city home price index posted a 1.3% increase in May from April as 19 of 20 cities showed price gains month over month. Of course, this was helped by the federal tax incentives which attracted some buyers into the market but we expect prices to remain flat or down for housing over the next six months.
Turning to earnings, Dupont (DD, $40.52, up $1.53) is up 4% after reporting better-than-expected results. The company said profits came in at $1.2 billion, or $1.26 a share, versus $417 million, or $0.41 a share, in the year-ago period.
Revenue jumped 25% to $8.6 billion while analysts were expecting $8.3 billion/ $0.94 a share. DuPont also raised its 2010 earnings forecast to $2.90-$3.05 a share, up from $2.50-$2.70 and above Wall Street’s expectations of $2.64 a share.
U.S. Steel (X, $45.93, down $2.96) is getting pounded and is down 6% today after reporting a negative numbers for its most recent quarter. Before the open, the company reported a loss of $25 million, or $0.17 a share, versus a loss of $392 million, or $2.92 a share, in the year-ago period. Revenue rose to $4.7 billion from $2.1 billion. Excluding items, U.S. Steel would have earned $0.45 a share but blamed the weakening of the euro against the dollar during the quarter for the miss.
And this just in, Apple (AAPL, $262.69, up $3.41) plans to sell an unlocked iPhone 4 in Canada starting on Friday. The company is moving in Research In Motion’s (RIMM, $53.82, down $1.71) own backyard and plans to allow customers to shop around for a service plan.
As we head to press, the Dow is currently holding a slight gain of 27 points and is at 10,552 while the S&P 500 is up a point to 1,116. The Nasdaq is lower by 4 points and is at 2,292. Upside targets are Dow 10,600; S&P 1,125; and Nasdaq 2,300. To the downside look for Dow 10,400, S&P 1,100; and Nasdaq 2,250.
We will be back in the morning with another full update at 9am. We have updated our current trades as we have one company reporting earnings before the bell on Wednesday. Subscribers, check the Members Area for our latest comments.
Tags: AAPL, Apple, call options, Canada iPhone, DD, Dupont, how to trade options, iPhone 4, momentum options trading, Momentum stocks, option picks, option stock picks, options alerts, options newsletter, options track record, put options, Research in Motion, RIMM, stock options trading, U.S. Steel, volatile options, x
Posted in Apple, Company Commentary, Earnings | Comments Off
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Bears Growl as S&P Falls Below 1,350
Tuesday, March 6th, 2012
1:15pm (EST)
We said March Madness would come early and that volatility would pick up in the market. Today’s weakness is all about the Greek debt situation, which is back in the front burner. There is a Thursday night deadline for Greece and its bondholders to come to an agreement over the debt bond swap in which the creditors would lose nearly 75% of their value on the bonds. It’s been nice not having to write about this situation for a few weeks but Greece is the word today.
We have spent a lot of time talking about the 5-week trading range we have been in and that there was a good chance this week that the market would move out of this range. We cited Wednesday’s Apple announcement of the iPad3 and Friday’s jobs figures as the two key events that would make or break the bulls push higher.
Often times when resistance is being tested, the indexes tend to overshoot these levels which we have been calling our “fluff” targets”. We said the Dow would move 1,000 points back in late November when the index was at 11,800 and we said the blue-chips would run into resistance at 12,800. We hit this mark in January. We also said if the Dow closed above this level there would be a chance at 13,000. If this level was cleared we said to watch for 13,250. To the downside, we said short-term support was at 12,900 and then 12,800 which is exactly where the Dow has been hovering. The index is currently down 193 points to 12,770.
We also said to look for a close above 1,375 for the S&P 500, which we haven’t gotten, and that if there were further weakness the bulls would need to hold 1,350. The index is down 20 points to 1,344 after opening at 1,363.63 which now bring 1,325-1,300 into the picture.
The Nasdaq is lower by 40 points to 2,910. Tech opened at 2,917and we said a dip below 2,925 would bring 2,900-2,850 into play. Here we are. Apple (AAPL, $529.07, down $4.09) is also lower and another clue we said to watch for.
The S&P Volatility Index (VIX, 21.55, up 1.98) is up 14% and above 20 for the first time since mid-February. This was another clue we said to watch for in Sunday’s Weekly Wrap.
We said there may be an opportunity to add a NEW TRADE or two today and that is what we are doing. Subscribers, check the Members Area for the updates and be sure to use limit orders to get the best fill prices.
Tags: Apple, iPad3, Nasdaq, Russell 2000, VIX
Posted in Market Analysis, Market Commentary, VIX | Comments Off