Market Soapbox 01/10/06
Resistance: DJIA 11000; SP500 1290; Nasdaq 2325; NDX 1745
Support: DJIA 10700 ; SP500 1240; Nasdaq 2200; NDX 1650
In our top story tonight, Generalissimo Francisco Franco is STILL dead. In other news, Wholesale Inventories at +0.4% vs prior +0.2% vs est. +0.6% showing that wholesale inventories had a build as sales fell 0.7% in November, the first drop since February and the biggest decline since April 2003.
Also, sales in October were weaker than first believed, being revised +0.9% in October, down from the initial estimate of +1.2%. In November, petroleum sales -7.0%, (reflecting a drop in prices) while furniture sales -2.3%, the biggest decline since December 2002. Auto sales -0.7%, durable goods -0.5% and nondurables -1.0%.
As a result, the inventory-to-sales ratio ticked up to 1.15 months in November from a record low 1.14 months in October, increasing economic slack while indicating a slowing in consumer spending and potential future slowing of economic activity.
16 weeks ago, DJIA -270 breaking key support. 15 weeks ago, DJIA +148, lacking conviction. 14 weeks ago, DJIA -281 crashing down. 13 weeks ago, large swings DJIA -6. 12 weeks ago larger swings, DJIA -77. Five weeks of downturn totaling -486.
11 weeks ago, recovery begins with larger swings, DJIA +186. 10 weeks ago, broadbased gains DJIA +128. 9 weeks ago, DJIA +154. 8 weeks ago, a slowing, DJIA +79. 7 weeks ago, DJIA +165. Five weeks of gains totaling DJIA +712.
6 weeks ago, DJIA -53, breaking the up trend. 5 weeks ago, DJIA -99, two straight down weeks. 4 weeks ago DJIA a deceiving +99. 3 weeks ago a weak DJIA +8. 2 weeks ago DJIA -168. Five weeks of downturn totaling DJIA -213
Last week DJIA +242 on a broadbased new year buy in. Mon DJIA +53 with nice followthrough. Today, 5 day rally pauses, DJIA flat on lower volume with midlin internals. This week DJIA +53, over the last 16 weeks +308.
DJUA, NDX, NAZ, MID, RUT, SOX & XOI up. XAU, DJTA, DJIA, SP500 & NYSE down. CAC, DAX, FTSE & Nikkei 225 down, Hang Seng up.
Dollar up vs. Euro & down vs. Yen, XAU & gold down @ 545, XOI up & crude down @ 63.37, CRB commodities down.
Yield curve INVERTED bonds down with the 10 year yield rising @ 4.43% & the 30 year @ 4.61. 6 month & 10 year gap 1 bp; 6 month & 2 year gap -3 bp; 2 & 5 year gap @ -3 bp; 2 & 10 year gap @ 4 bp; 5 & 10 year gap @ 7 bp; 10 & 30 gap @ 18 bp.
Looking ahead at potential market influences: Jan 11 EIA Crude; Jan 12 Export Prices ex ag, Import Prices ex oil, Initial Claims, Trade Balance, Treausury Budget; Jan 13 Business Inventories, PPI, Core PPI, Retail Sales, Retail Sales ex auto..
Sectors: Energy, Natural Gas, Oil, Oil Services, Retail, REIT, Real Estate, Networking, Biotech & Semis all up nicely. Healthcare, Materials, Cyclical, Pharma, Airlines, Transports down.
FYI, if you went to cash and sat out last year, then decided to play the market to the upside last week... as of yesterday's close, the DJIA, SP500 and NAZ were already up 2.7%, 3.4% and 5.1%, respectively, for this year, surpassing all of last year's gains. (Being in cash, you would have missed out on dividents.)
Contra trend of note: the RTH retailers have been pulling back since 11/23/05, the DJTA transports since 12/27/05. The old rule: retail falls, then transports, then industrials.
From 12/23/05: "since 12/15 the put to call ratio on equity and index options has gone from 0.41 to 1.22" So far, these guys are wrong, unless there is a change in direction they will start to cover their shorts before options expiration on Jan 20th.
From 12/23/05: "if the rally started 10/13 continues upward in a thinly traded fashion, it probably won't go past 1746 on the NDX." We have formed a triple top on many indices as the NDX touched 1745 yesterday and has pulled back.
The MID & RUT have a 6 day up streak running, while the DJIA's 5 day streak paused today and the DJTA is down two days straight.
Tomorrows $13B 5 year treasury note & Thurs 10 year TIPS auctions will drain liquidity from the market. Add in an EIA crude build, pulling crude and energy down, which could cause a mini consolidation or pullback.
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. In other news, Wholesale Inventories at +0.4% vs prior +0.2% vs est. +0.6% showing that wholesale inventories had a build as sales fell 0.7% in November, the first drop since February and the biggest decline since April 2003.
Also, sales in October were weaker than first believed, being revised +0.9% in October, down from the initial estimate of +1.2%. In November, petroleum sales -7.0%, (reflecting a drop in prices) while furniture sales -2.3%, the biggest decline since December 2002. Auto sales -0.7%, durable goods -0.5% and nondurables -1.0%.
As a result, the inventory-to-sales ratio ticked up to 1.15 months in November from a record low 1.14 months in October, increasing economic slack while indicating a slowing in consumer spending and potential future slowing of economic activity.
16 weeks ago, DJIA -270 breaking key support. 15 weeks ago, DJIA +148, lacking conviction. 14 weeks ago, DJIA -281 crashing down. 13 weeks ago, large swings DJIA -6. 12 weeks ago larger swings, DJIA -77. Five weeks of downturn totaling -486.
11 weeks ago, recovery begins with larger swings, DJIA +186. 10 weeks ago, broadbased gains DJIA +128. 9 weeks ago, DJIA +154. 8 weeks ago, a slowing, DJIA +79. 7 weeks ago, DJIA +165. Five weeks of gains totaling DJIA +712.
6 weeks ago, DJIA -53, breaking the up trend. 5 weeks ago, DJIA -99, two straight down weeks. 4 weeks ago DJIA a deceiving +99. 3 weeks ago a weak DJIA +8. 2 weeks ago DJIA -168. Five weeks of downturn totaling DJIA -213
Last week DJIA +242 on a broadbased new year buy in. Mon DJIA +53 with nice followthrough. Today, 5 day rally pauses, DJIA flat on lower volume with midlin internals. This week DJIA +53, over the last 16 weeks +308.
DJUA, NDX, NAZ, MID, RUT, SOX & XOI up. XAU, DJTA, DJIA, SP500 & NYSE down. CAC, DAX, FTSE & Nikkei 225 down, Hang Seng up.
Dollar up vs. Euro & down vs. Yen, XAU & gold down @ 545, XOI up & crude down @ 63.37, CRB commodities down.
Yield curve INVERTED bonds down with the 10 year yield rising @ 4.43% & the 30 year @ 4.61. 6 month & 10 year gap 1 bp; 6 month & 2 year gap -3 bp; 2 & 5 year gap @ -3 bp; 2 & 10 year gap @ 4 bp; 5 & 10 year gap @ 7 bp; 10 & 30 gap @ 18 bp.
Looking ahead at potential market influences: Jan 11 EIA Crude; Jan 12 Export Prices ex ag, Import Prices ex oil, Initial Claims, Trade Balance, Treausury Budget; Jan 13 Business Inventories, PPI, Core PPI, Retail Sales, Retail Sales ex auto..
Sectors: Energy, Natural Gas, Oil, Oil Services, Retail, REIT, Real Estate, Networking, Biotech & Semis all up nicely. Healthcare, Materials, Cyclical, Pharma, Airlines, Transports down.
FYI, if you went to cash and sat out last year, then decided to play the market to the upside last week... as of yesterday's close, the DJIA, SP500 and NAZ were already up 2.7%, 3.4% and 5.1%, respectively, for this year, surpassing all of last year's gains. (Being in cash, you would have missed out on dividents.)
Contra trend of note: the RTH retailers have been pulling back since 11/23/05, the DJTA transports since 12/27/05. The old rule: retail falls, then transports, then industrials.
From 12/23/05: "since 12/15 the put to call ratio on equity and index options has gone from 0.41 to 1.22" So far, these guys are wrong, unless there is a change in direction they will start to cover their shorts before options expiration on Jan 20th.
From 12/23/05: "if the rally started 10/13 continues upward in a thinly traded fashion, it probably won't go past 1746 on the NDX." We have formed a triple top on many indices as the NDX touched 1745 yesterday and has pulled back.
The MID & RUT have a 6 day up streak running, while the DJIA's 5 day streak paused today and the DJTA is down two days straight.
Tomorrows $13B 5 year treasury note & Thurs 10 year TIPS auctions will drain liquidity from the market. Add in an EIA crude build, pulling crude and energy down, which could cause a mini consolidation or pullback.
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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