Market Soapbox 12/22/05
Resistance: DJIA 11000; SP500 1300; Nasdaq 2300; NDX 1750
Support: DJIA 10700 ; SP500 1240; Nasdaq 2200; NDX 1650
In our top story tonight, Generalissimo Francisco Franco is STILL dead. Last Wen the Canadian dollar hit a 14 year high vs the US dollar, but has sold off since the dollar had rallied for 3 straight days till today.
In other news, Initial claims 318K vs est 325K vs prior 331K showing a gain on payrolls. Personal Income +0.3% vs est +0.4% vs prior +0.5% showing a deaccelerating increase in personal incomes.
Personal Spending +0.3% vs est. +0.5% vs prior +0.2% showing a slight increase in spending. Leading indicators +0.5% vs est +0.5% vs prior +1.0% showing a decline.
Yesterday to be filed under boats that were missed, disk drive sector +7% on Seagates announcement of a $1.9B bid to buy Maxtor, uniting two of the largest disk drive companies, Maxtor (MXO) stock up 53% on the news.
Also, IBM proposed a $10 per share, $865 Million purchase of Micromuse (MUSE) makers of NETCOOL, an object oriented systems management tool.
Micromuse stock IPO on 02/13/98 at $4.71, peaking 10/23/00 at $106.2, bottoming 10/09/02 at $1.37. Today, Micromuse stock jumping from $7.21 to $9.92, up 38% on the news.
And finally, Total PCE and the PCE showed a clear case of inflation and even with energy costs pulling back, a clear case of energy stagflation in the supply chain. Todays SOOHEY, PIG, PIG!! award and details on the PCE are in a separate post.
13 weeks ago, DJIA -270 breaking key support. 12 weeks ago, DJIA +148, lacking conviction. 11 weeks ago, DJIA -281 crashing down. 10 weeks ago, large swings DJIA -6. 9 weeks ago larger swings, DJIA -77. Five weeks of downturn totaling -486.
8 weeks ago, recovery begins with larger swings, DJIA +186. 7 weeks ago, broadbased gains DJIA +128. 6 weeks ago, DJIA +154. 5 weeks ago, a slowing, DJIA +79. 4 weeks ago, DJIA +165. Five weeks of gains totaling DJIA +712.
3 weeks ago, DJIA -53, breaking the up trend. 2 weeks ago, DJIA -99, two straight down weeks. Last week DJIA a deceiving +99 as mid, small, tech, semis, energy & precious metals pulled back.
Mon, a broadbased consolidation, DJIA -39 on grisly internals. Tues, DJIA -31, MID & RUT resisting, on ugly internals. Wen, a thinly traded day on improved internals, DJIA +28 bleeding into close. Today, DJIA +56 on low volume with improved internals. This week DJIA +14. over the last 13 weeks DJIA +187.
DJTA, DJUA, SOX, NDX, RUT, MID & XAU up nicely as the broader market rallied despite XOI down on a energy sector pullback with falling crude. CAC down, DAX & FTSE up, Hang Seng & Nikkei 225 down.
Dollar down vs. Euro & Yen, XAU & gold up BIG 2% @ 505, XOI & crude down @ 58.28, CRB commodities up, Natural Gas plummeting 9% on a higher inventory read.
Treasuries having their worst year since 1999 when the Fed bumped 8 straight times prior to inverting the yield curve and popping the Internet bubble.
Low end inversion as bonds up BIG with the 10 year yield falling @ 4.43% & the 30 year @ 4.62. The 2 & 5 year @ -1 basis points; the 5 & 10 year gap @ 6 basis points; the 10 & 30 gap @ 19 basis points.
Sectors: Airlines, Gold Bugs, Biotech, Broker, Transports, Healthcare, High Tech & Semis up nicely. Natural Gas, Energy, Oil, Financial, Retail, Real Estate & Telecom down.
Looking ahead at potential market influences: Dec 23 Durable orders, Mich sentiment, New home sales. Dec 28 Consumer confidence; Dec 29 Initial claims, Existing home sales, EIA crude inventories; Dec 30 Chicago PMI
From yesterday: "Close observation of the next few trading days is required. We have our feet inside our shorts and are getting ready to pull them up and on. However, we cannot preclude one last pop to the upside prior to year end."
Since the current rally begin 10/14 we have seen declines in: the number of trades (broker business has slowed down), dollars traded (less traders), ratio of shares to trades (larger traders moving market and/or less small traders in the market).
We believe that last weeks options quadruple witching effects are over. Since 12/15 the put to call ratio on equity and index options has gone from 0.41 to 1.22, thats quite a change in sentiment in a very short time (no pun intended, read; there are alot of people putting their Bermuda shorts on).
Over the last 5 trading days of the year; monthly, quarterly and year end "bonus" hunting for the brown shoed boys on the Street, will be accomodated through window dressing, but may be offset by portfolio shifting.
So, we are now waddling around with our shorts around out ankles and paying close attention to Low: NDX 1665 High: SP500 1270 as break out points that will show us whether to pull them up or to grab our "long" johns.
Keep it tween da ditches, we take it day by day and keep our eyes peeled to the sky, because it could be a name brand that pancakes us. Just my opinion, I could be wrong, this is The Nattering Naybob and your NOT!!!
Support: DJIA 10700 ; SP500 1240; Nasdaq 2200; NDX 1650
In our top story tonight, Generalissimo Francisco Franco is STILL dead. Last Wen the Canadian dollar hit a 14 year high vs the US dollar, but has sold off since the dollar had rallied for 3 straight days till today.
In other news, Initial claims 318K vs est 325K vs prior 331K showing a gain on payrolls. Personal Income +0.3% vs est +0.4% vs prior +0.5% showing a deaccelerating increase in personal incomes.
Personal Spending +0.3% vs est. +0.5% vs prior +0.2% showing a slight increase in spending. Leading indicators +0.5% vs est +0.5% vs prior +1.0% showing a decline.
Yesterday to be filed under boats that were missed, disk drive sector +7% on Seagates announcement of a $1.9B bid to buy Maxtor, uniting two of the largest disk drive companies, Maxtor (MXO) stock up 53% on the news.
Also, IBM proposed a $10 per share, $865 Million purchase of Micromuse (MUSE) makers of NETCOOL, an object oriented systems management tool.
Micromuse stock IPO on 02/13/98 at $4.71, peaking 10/23/00 at $106.2, bottoming 10/09/02 at $1.37. Today, Micromuse stock jumping from $7.21 to $9.92, up 38% on the news.
And finally, Total PCE and the PCE showed a clear case of inflation and even with energy costs pulling back, a clear case of energy stagflation in the supply chain. Todays SOOHEY, PIG, PIG!! award and details on the PCE are in a separate post.
13 weeks ago, DJIA -270 breaking key support. 12 weeks ago, DJIA +148, lacking conviction. 11 weeks ago, DJIA -281 crashing down. 10 weeks ago, large swings DJIA -6. 9 weeks ago larger swings, DJIA -77. Five weeks of downturn totaling -486.
8 weeks ago, recovery begins with larger swings, DJIA +186. 7 weeks ago, broadbased gains DJIA +128. 6 weeks ago, DJIA +154. 5 weeks ago, a slowing, DJIA +79. 4 weeks ago, DJIA +165. Five weeks of gains totaling DJIA +712.
3 weeks ago, DJIA -53, breaking the up trend. 2 weeks ago, DJIA -99, two straight down weeks. Last week DJIA a deceiving +99 as mid, small, tech, semis, energy & precious metals pulled back.
Mon, a broadbased consolidation, DJIA -39 on grisly internals. Tues, DJIA -31, MID & RUT resisting, on ugly internals. Wen, a thinly traded day on improved internals, DJIA +28 bleeding into close. Today, DJIA +56 on low volume with improved internals. This week DJIA +14. over the last 13 weeks DJIA +187.
DJTA, DJUA, SOX, NDX, RUT, MID & XAU up nicely as the broader market rallied despite XOI down on a energy sector pullback with falling crude. CAC down, DAX & FTSE up, Hang Seng & Nikkei 225 down.
Dollar down vs. Euro & Yen, XAU & gold up BIG 2% @ 505, XOI & crude down @ 58.28, CRB commodities up, Natural Gas plummeting 9% on a higher inventory read.
Treasuries having their worst year since 1999 when the Fed bumped 8 straight times prior to inverting the yield curve and popping the Internet bubble.
Low end inversion as bonds up BIG with the 10 year yield falling @ 4.43% & the 30 year @ 4.62. The 2 & 5 year @ -1 basis points; the 5 & 10 year gap @ 6 basis points; the 10 & 30 gap @ 19 basis points.
Sectors: Airlines, Gold Bugs, Biotech, Broker, Transports, Healthcare, High Tech & Semis up nicely. Natural Gas, Energy, Oil, Financial, Retail, Real Estate & Telecom down.
Looking ahead at potential market influences: Dec 23 Durable orders, Mich sentiment, New home sales. Dec 28 Consumer confidence; Dec 29 Initial claims, Existing home sales, EIA crude inventories; Dec 30 Chicago PMI
From yesterday: "Close observation of the next few trading days is required. We have our feet inside our shorts and are getting ready to pull them up and on. However, we cannot preclude one last pop to the upside prior to year end."
Since the current rally begin 10/14 we have seen declines in: the number of trades (broker business has slowed down), dollars traded (less traders), ratio of shares to trades (larger traders moving market and/or less small traders in the market).
We believe that last weeks options quadruple witching effects are over. Since 12/15 the put to call ratio on equity and index options has gone from 0.41 to 1.22, thats quite a change in sentiment in a very short time (no pun intended, read; there are alot of people putting their Bermuda shorts on).
Over the last 5 trading days of the year; monthly, quarterly and year end "bonus" hunting for the brown shoed boys on the Street, will be accomodated through window dressing, but may be offset by portfolio shifting.
So, we are now waddling around with our shorts around out ankles and paying close attention to Low: NDX 1665 High: SP500 1270 as break out points that will show us whether to pull them up or to grab our "long" johns.
Keep it tween da ditches, we take it day by day and keep our eyes peeled to the sky, because it could be a name brand that pancakes us. Just my opinion, I could be wrong, this is The Nattering Naybob and your NOT!!!
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