By Gareth Soloway on May 21st, 2010 1:18pm Eastern Time
The markets closed at their lows of the day yesterday. The SPDR S&P 500 ETF (NYSE:SPY) closed at $107.54. The fear was palpable as the futures overnight and this morning sold even more. As the fear spread at the open, the markets gapped lower. The SPY gapped down to $105.91. This was exactly what a true swing and day trader was looking for to buy the markets.
Exxon Mobil Corporation (NYSE:XOM) was one of the longs played, picking it up at $59.55 on the open. The alert was given in the Research Center on the Hot Charts and Alerts. Profits were taken just two hours later for a $1.00 gain at $60.55. In addition, other plays had been accumulated and given as alerts. These plays were in the solar sector. Suntech Power Holdings Co., Ltd. (NYSE:STP), Trina Solar Limited (NYSE:TSL), Canadian Solar Inc. (NASDAQ:CSIQ) and SunPower Corporation (NASDAQ:SPWRA) were all discussed and given in the Research Center as well. They were highlighted because of a major oversold situation and the fact that as a Chief Market Strategist, I saw the Euro was going to bounce this week. The CurrencyShares Euro Trust (NYSE:FXE) was given as a trade to the long side at $122.48. Today it hit a high of $125.59. What a gain! In addition, solar stocks have a ton of exposure to the Euro and have been hammered by the falling Euro. In that case, logic stated a bounce in the Euro would bring a pop in the solar stocks. Sure enough after making a beautiful bottoming tail on the charts, the solar stocks raced higher. More profits to all.
Always understand the markets folks. When everyone is ready to jump off a cliff, accumulate longs and profit. By reading the charts and sentiment, you can become one of the elite swing traders in the world. This is what we do, these are the profits just over the last day or two.
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.comRead more…
By Nicholas Santiago on May 21st, 2010 3:24pm Eastern Time
While the markets try desperately to find support during this may decline there are a few stocks that are behaving well on the session. Ironically, these are the stocks that many blame for the crisis in the first place. Whether or not this is entirely true the large major banks are the strong stocks today.
The major large banks such as J.P. Morgan Chase & Co (NYSE:JPM), Goldman Sachs Group Inc (NYSE:GS), Wells Fargo & Co (NYSE:WFC), Bank of America Corp (NYSE:BAC) and Morgan Stanley (NYSE:MS) are all trading sharply higher on the session. These stocks have been severely oversold in the short term on the daily chart and many are at critical support levels. Therefore, a technical bounce on these stocks is not a huge surprise here.
It is important to remember that these stocks have benefited the most from the U.S. government Toxic Asset Relief Program (TARP). These companies can borrow money from the Federal Reserve Bank at nearly zero percent and buy treasuries in order to make money. When you add in their credit card business and proprietary trading they do not even need to make a loan in order to make money. There is also much less competition in the industry when you consider the consolidation that has taken place since 2008. Regional banks also continue to fail every week as well. This year alone there have been over seventy bank failures in the U.S for 2010.
Should these stocks implode in the near future it should be a signal that the major market indexes will see further downside. These leading stocks have all had sharp declines from their recent highs; however, the decline in the financial stocks has not been anything close to the commodity related names which inflated the markets in 2009. The large banks lead the decline in 2008 and early 2009. If these large banks take the leadership role to the downside watch out below.
Nicholas Santiago
Chief Market Strategist
www.IntheMoneyStocks.com
ALERT: Get in-depth analysis, along with exact entries/exits, swing trades, and scalp trades, direct from our Pros, join our Research Center or Intra Day Stock Chat NOW and enter the ranks of the Pros!
Read more…
UNCONFIRMED RUMOURS that Goldman Sachs has settled with the SEC are said to be boosting equities and the risk trade at the expense of the USD and JPY. Dow rallies +200 pts from its pre-open low. Todays passing of the German rescue bill at the Upper House of parliament will attempt to lift EURUSD above $1.2620, which is an important short-term resistance, linking the highs of May 2 and May 10. As EURUSD posts its 3rd consecutive daily gain, the pair HAS YET TO post 4-straight daily gains this year. AUDUSD aims at regaining 0.8320, a close above it would be important in extending bounce towards 0.8430. But previous key support of 0.8570, to remain firm resistance. USDCAD 4-hour showing signs of double top at 1.0730, which could extend drop towards 1.0570 trendline support in event of extended risk bounce. CAD remains better short vs. JPY than vs. USD.
Read more…
EURUSD LOSES GROUND to join the commodity currencies on the downside after German IFO sentiment survey slipped in May to 101.5 from 101.6 vs expectations of a rise to 102. NIKKEI-225 GAPPED DOWN 240 pts on Friday following its 300-pt Thursday decline. Dow-30, S&P500 & Nikkei-225 all retested the lows reached on Black Thursday May 6th. MORE BAD NEWS FOR UK as the April Public Sector Borrowing Requirement surged to a new record of 8.8bln, M3 (money supply) was flat for the month and mortgage approvals fell to 47K, highlighting continued govt borrowing and weak bank lending. Cable upside seen capped at $1.4440s, but EURGBP appears vulnerable for fresh break below 0.8650. AUSSIE REMAINS AN AGGRESSIVE LOSER as traders sell the rebounds to renew focus on 0.8140 and 0.80. USDCAD supported by hourly trendline at 1.0610 before renewed run-up to 1.07. EURCHF crushed our trend line resistance of 1.43, but the BEARISH DAILY GAP-DOWN suggests a return below 1.42 if we close the week (today) below 1.4330s. Subseq resistance at 1.4640.
Read more…
DAMAGED GOODS is the state of the commodity currencies as their selloff intensifies primarily against JPY, USD and to lesser extent the euro. What started as a shapr selloff in AUD is now broadening into CAD and NZD. We continue to target 0.8140 and 0.80 as prelim AUDUSD targets, followed by 0.78 as the ultimate objective following the break of 0.8570. EURCHF failed to breach the 1.43 trend line resistance despite yesterday's intervention, thus calling up prelim targets at 1.427 followed by 1.4220 and 1.4070. GBPUSD eyes 1.4250, a break of which calls up 1.4130 but at this point it's more appropriate to play GBP shorts via EURGBP longs. Ashraf is travelling so no updates for the rest of the day.
Read more…
USD 3-MONTH LIBOR REACHES 0.48%, doubling the levels from the November lows, as it reflects the escalating cost of USD-funding for US and non-US banks. Lack of trust among banks as well as liquidity difficulties are the main culprit. Fed has responded by providing USD-funding through FX swaps with major central banks. If these measures continue to show little effect in alleviating funding costs, central banks may have no choice but to carry out outright interventions (selling USD vs EUR). Meanwhile, AUD, CAD, NZD continue to be the PREFERRED SHORTS as traders take a break from assaulting EUR ahead of a possible intervention. AUDUSD eyes 0.82, followed by 0.8130-40. GBP WEAKNESS broadens as EURGBP break sabove 0.8620s eyeing 0.8710 but CHF STRENGTH prevening EURCHF from regaining 1.43.
Read more…
By InTheMoneyStocks on May 19th, 2010 3:21pm Eastern Time
Today has been one heck of a volatile trading day. This type of action is common during the week of options expiration. Let us not forget that this market is in the eye of the storm as the European debt crisis is still front and center.
The Currencyshares Euro Trust (NYSE:FXE) looks to be bouncing today after making new lows for the year yesterday. The U.S. Dollar Index has declined sharply today trading lower by $0.79 cents to $86.37. The dollar chart is just the opposite of the Euro as it traded to new highs last night.
Some stocks that are catching a bid in this market are United States Steel Corp (NYSE:X), Monsanto Co (NYSE:MON), and Deere & Co (NYSE:DE). These are the standout stocks as most other leading names are still down on the session.
Financial regulation is also one of the hot topics that is being debated by the politicians today. The details for this bill are still unclear. However, many traders believe that the bank regulations will not be as severe as originally expected. However, 'Super Tuesday' was yesterday and many politicians have to be wondering if they can play the same old games.
There is a lot of action going in the Wild West today. Stay tuned and keep watching that U.S. Dollar Index Chart as the dollar will usually help inflate the markets when it declines and deflate the markets when it rises.
Read more…
By InTheMoneyStocks.com on May 19th, 2010 12:17pm Eastern Time
The markets dropped sharply by mid day on as the SPDR S&P 500 ETF (NYSE:SPY) hit the 200 moving average. This is a major technical level and should be respected short term. Since hitting this level at $110.40, the SPY has bounced sharply back to $111.00 where it currently hovers. Fear continues to grip Europe and is spreading world wide. The major cause in recent weeks of the massive market drop has been the collapsing Euro. Today the Euro is bouncing and the fear is so wide spread, the markets still cannot bounce. United States Oil Fund LP (NYSE:USO) is dropping sharply again as well. Oil is down well over 20% now in the last two weeks.
The markets are in a precarious position. If a bounce in the Euro is not helping, then the 200 moving average is all that stands between this market and the lows from February being hit on the SPY at $104.58. That would be another 5% drop from the current level and also retest the lows from the DOW -1000 point down a few weeks ago.
Stocks have been crushed across the board. Apple Inc. (NASDAQ:AAPL) computer is dropping the Nasdaq as it is lower at $246.54 -$5.82 (-2.31%). Google Inc. (NASDAQ:GOOG) broke the key $500 level yesterday and has continued to sell today. It is at $492.33 -$6.04 (-1.21%). Commodity stocks are under pressure as well. Stocks like AK Steel Holding Corporation (NYSE:AKS) are down over 2% as a double dip global slowdown rears its ugly head.
From a technical standpoint, this market tagged the 200 moving average and should be respected. As long as that holds on a daily closing basis, look for a bounce from these levels. Many of these stocks mentioned should bounce from currently levels. Should the 200 moving average be closed below, this market may continue down to the $104 - $105 level on the SPY.
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com
ALERT: Get in-depth analysis, along with exact entries/exits, swing trades, and scalp trades, direct from our Pros, join our Research Center or Intra Day Stock Chat NOW and enter the ranks of the Pros!
Read more…
