InTheMoneyStocks Market Analysis

[amit1986]

Re: Do Not Get Caught With Your Pants Down

Don't listen to this guy....NEVER BET AGAINST THE PREVAILING TREND.

What the OP has said is exactly correct. If JP Morgan was really short, they'd definitely have the power to decrease price.

Great post.

 

[wackypete2]

Re: Do Not Get Caught With Your Pants Down

haha i bet i had half of arabian's chatroom take off their pants today .
*****

Not something I'd want to see, thank you.

Peter

 

[Chartsy]

Re: Do Not Get Caught With Your Pants Down

Not something I'd want to see, thank you.

Peter

you'd have to look pretty hard to 'see' anything. i think martinghoul probably is the most well hung out of the lot

 

[TRADEFUTURES]

Re: Do Not Get Caught With Your Pants Down

haha, the OP is actually dead on. The hype was telling the amateur to buy silver yesterday via the media. Instead, the gap up this morning was the perfect shorting opportunity. I nailed it via their call actually. A trend trader is only a winner until the trend fails. Learn the techniques and become a better trader my friend before spewing crap

yea yea yea! Save it for some other mug.

1st post by jpaulino? sounds like a false testimonial to me. People are actually not that stupid to not realise that your FIRST post here is a false / biased testimonial>>> testimonial probably if not certainly sanctioned by inthemoneystocks themselves.

Nice try!

 

[InTheMoneyStocks]

Biotechnology Stocks Hot Off Of Orexigen Panel Vote

Orexigen Therapeutics, Inc. (NASDAQ:OREX) is trading at $9.39, +4.63 (+97.27%), after an FDA panel voted in favor of giving their diet drug FDA approval. This vote does not constitute approval yet, but generally when the panel votes in favor, the drug is approved. As Orexigen sky rockets, sympathy plays in the diet drug space are also seeing massive gains. VIVUS, Inc. (NASDAQ:VVUS) and Arena Pharmaceuticals, Inc. (NASDAQ:ARNA) are both trading higher by more than ten percent.

Biotechnology small cap stocks are one of the few areas that have not seen any sort of run up in the last three months. Due to this factor, I am looking for small cap biotech plays that have nice setups or at the dead lows. I have picked up a few in recent days and the OREX news seems to be waking them up. My favorites are Poniard Pharmaceuticals, Inc. (NASDAQARD), which currently trades below cash value and Somaxon Pharmaceuticals, Inc. (NASDAQ:SOMX) which has a solid bullish consolidation pattern on daily chart, while trading near the lows. Should biotechnology stocks wake up, I believe these two will be among the first to rocket.

Gareth Soloway

 

[InTheMoneyStocks]

Fed Remains Status Quo. What Else Could We Expect?

The Federal Reserve Bank made it's decision to keep interest rates unchanged at 0.00 – 0.25 percent. This is the same level that the overnight bank lending rate has been since December 2008. The Federal Reserve also said that they would continue with it's quantitative easing or treasury purchasing program.

The central bank did not mention the sharp increase in the 10 Year Treasury Note yield. The yield on the 10 year Treasury has risen by nearly a full point since the last Fed meeting on November 3rd, 2010. Remember a higher yield on the 10 Year Treasury Note increases mortgage rates and that is something that the Fed has verbally said that they would try and keep low. In any case a stronger yield is telling the world that inflation is creeping in the market as the Federal Reserve insists that inflation is very low. It is very difficult for many traders and investors to say that inflation is low and contained when gasoline, gold, silver, copper, cotton, and most other commodities remain at highs for the year.

Nicholas Santiago
Chief Market Strategist

 

[InTheMoneyStocks]

The Federal Reserve Versus Common Sense

A bubble has started to inflate and once again the Federal Reserve has a direct relationship with it. The markets have soared over the last few months as the SPDR S&P 500 ETF (NYSE:SPY) has gone from $104.50 to a recent high of $125.20. This move has lifted the SPY twenty percent. Behind the move is the Federal Reserve, printing and pumping money into the system to create an asset bubble. As they print, the Dollar declines and in response, all assets must adjust their prices higher. Higher assets like 401k's make the average American feel richer and thus spend more. While they may feel richer, in actual terms they are not. As their investment accounts move higher, the buying power is adjusting lower. Most Americans have no perception of this but they will feel the pinch currently at the supermarket and when paying their energy bills. In the not too distant future, they will feel it in every other purchase they make. As the asset bubble inflates, common sense says eventually it will collapse.

While the Federal Reserve continues to push the market higher with their constant printing of money and propping of the markets, common sense marvels at the heights at which the markets currently trade. To understand that the gains in the market are built on a thinly veiled prop job is a scary thought, especially for those that have been through the last few bursting bubbles. The battle continues and will continue. Does the intelligent trader try and fight the Federal Reserve by shorting the market or give way and understand their prop job powers? The true answer is simple. The Federal Reserve will be able to prop the markets until something bigger happens. Once a shock hits the markets, the bubble will bursts. The bigger question is, when will that be?

Gareth Soloway

 

[meanreversion]

Re: The Federal Reserve Versus Common Sense

Er, no disrespect but I get nothing from this article. What is the point? That at some undetermined point in the future something might happen to perhaps cause the market to move lower?

 

[Martinghoul]

Re: The Federal Reserve Versus Common Sense

It's a pity to let a good theory go to waste, but hasn't the US Dollar actually been rising in the last few months?

 

[meanreversion]

Re: The Federal Reserve Versus Common Sense

Never let the facts get in the way of a good story.

 

[meanreversion]

Re: The Federal Reserve Versus Common Sense

In fairness, picking the moment at which a bubble bursts can be exceptionally lucrative, viz. the CDS trade of John Paulson.

But he is fairly unusual in the prescience, scaling and persistance in his trade.

 

[Martinghoul]

Re: The Federal Reserve Versus Common Sense

Well, either that or he's just one lucky guy among thousands that also tried and failed, ones, we've never heard of... Survivorship bias is a wonderful thing, but, unfortunately, only for the survivors, innit? Makes it difficult to decide whether the strategy makes sense, don't it?

 

[tomorton]

Re: The Federal Reserve Versus Common Sense

The pressure all traders feel to predict top or bottom reversals just underlines how difficult it is - the most difficult task in trading I suggest - to exit at the optimum point from a winning trade.

Otherwise, we would all just buy when price is going up and short when it's going down. The FTSE's up 6% in December trading - clearly some kind of bubble over here too.

 

[cdma20090]

Re: Fed Remains Status Quo. What Else Could We Expect?

The Federal Reserve Bank made it's decision to keep interest rates unchanged at 0.00 – 0.25 percent. This is the same level that the overnight bank lending rate has been since December 2008. The Federal Reserve also said that they would continue with it's quantitative easing or treasury purchasing program.

The central bank did not mention the sharp increase in the 10 Year Treasury Note yield. The yield on the 10 year Treasury has risen by nearly a full point since the last Fed meeting on November 3rd, 2010. Remember a higher yield on the 10 Year Treasury Note increases mortgage rates and that is something that the Fed has verbally said that they would try and keep low. In any case a stronger yield is telling the world that inflation is creeping in the market as the Federal Reserve insists that inflation is very low. It is very difficult for many traders and investors to say that inflation is low and contained when gasoline, gold, silver, copper, cotton, and most other commodities remain at highs for the year.

Nicholas Santiago
Chief Market Strategist

hi,it is helpful for your share, thanks. i have a question is that if the note yield were higher in the future,should the gold price become higher for the inflation's concern or uncertainty of economy recovery? and why?

another is that if fed bought many notes try to maintain a low interest rate, will the note price be higher or lower? for the fed's long position,maybe it will push the price higher;but giving the traders concern of inflation, they (except fed) may short notes and increase the rate.so, what's your opinion? thanks.

 

[InTheMoneyStocks]

Home-Builder Stocks Looking Extended

Since the December 1st pivot date the entire stock market has rallied higher. Most industry groups have participated in the broad based advance. Often money will rotate from one sector to the next depending upon how far a particular sector has rallied. Well, it now appears that the home builder sector has now reached the top of its trading range. When a stock or industry group reaches the top of its range the institutions that own the stocks will usually look to start unloading or sell the stocks. This is usually when the public or the retail trader is buying the stock because they feel that they want to own something that is up so much. The public usually does the opposite of the institutions.

Toll Brothers Inc.(NYSE:TOL) has rallied higher since late November when the stock traded around $17.35 a share. Today Toll Brothers Inc. is trading at $19.50 and this is the high range for the stock over the past three months. Therefore, this is when the institutions will begin to start unloading or feeding the stock out to the public. In other words a pullback will begin shortly.

Lennar Corp.(NYSE:LEN) is another leading home builder stock that has rallied higher since late November when the stock was trading at $15.00 a share. Today the stock traded as high as $18.49. This stock is now trading around a good short term resistance area and a pullback could be near. The next important resistance area for the stock will be around the $20.00 area.

D.R. Horton Inc.(NYSEHI) is another leading home builder stock that was trading around $9.80 in late November. Today the stock is trading just under the $12.00 level which is very good resistance. On November 12th, 2010 the stock traded as high as $12.20 a share so this would be the high range for the stock and D.R. Horton could reach that level. However, this is where the institutions will start to distribute or sell stock. Therefore, it is prudent to expect a pullback soon.

This is the holiday season so it is possible to see stocks hold up into the holidays. However, when certain stocks or industry groups reach their prior highs of the range it is a time for the institutions to take profits. Therefore, expect pullbacks in the home building sector soon.

Nicholas Santiago

 

[InTheMoneyStocks]

Market Moving ETF Update

The theme to this Weekly Market Report will be Exchange Traded Funds or ETF's as they are often called by most traders and investors. An exchange traded fund is a security that trades just like a stock. The ETF will usually track an index or specific sector in the market by holding a basket of individual securities.

The PowerShares QQQ Trust, Series 1 (ETF) (NASDAQ:QQQQ) ended the week slightly higher ahead of the Christmas holiday. Since late August the technology heavy QQQQ's has rallied higher by over 20.0 percent. While the QQQQ's remain in a strong weekly uptrend there will be important daily chart price resistance levels approaching soon. Traders and investors should watch the $55.50 area for the next major daily resistance area. The weekly resistance levels will be at $60.00, and next at the $63.30 level. This week is the period between the Christmas and New Years holiday. This is usually a very light volume time in the markets which normally trade sideways to slightly higher. Therefore, unless a major geopolitical event occurs we would not expect much downside action. The top five holding in the QQQQ is
Apple Inc. (NASDAQ:AAPL) 19.74%, Google Inc. (NASDAQ:GOOG) 4.73%, Qualcomm Inc. (NASDAQ:QCOM) 4.50%, Microsoft Corp. (NASDAQ:MSFT) 4.09%, and Oracle Corp. (NASDAQ:ORCL) 3.17%.

The Oil Service HOLDRs (ETF) (NYSE:OIH) is a basket of the leading oil services companies. This index has soared higher by 40.0 percent since the announcement of quantitative easing by the Federal Reserve Bank in late August. The OIH remains in a strong uptrend, however, it has stalled out around the $139.00 daily chart resistance level. Should the OIH trade above this current resistance area the $145.00, and $151.00 levels will be the next major resistance levels. Traders should watch for pullbacks around these important price points. The top five holdings for the OIH are Schlumberger Limited. (NYSE:SLB) 20.12%, Baker Hughes Incorporated (NYSE:BHI) 13.07%, Halliburton Company (NYSE:HAL) 12.60%, Transocean LTD. (NYSE:RIG)11.42%, and National-Oilwell Varco, Inc. (NYSE:NOV) 8.62%.

The Market Vectors Junior Miners ETF (NYSE:GDXJ) remains in a correction after staging a 4.00 point sell off last week. The daily chart does have support around the $37.50 level which was tagged on Friday. Should this support area fail to hold the next important weekly support levels will be $35.25, and $32.50. Due to the light holiday volume it would be prudent to expect a small bounce off the current $37.50 area. The top five holdings in GDXJ are Semafo Inc. 5.16%, Allied Nevada Gold Corp. (AMEX:ANV) 4.29%, Alamos Gold Inc. 3.94%, Detour Gold Corporation 3.64%, and Coeur D'Alene Mines Corp. (NYSE:CDE) 3.61%. As long as central banks continue to print money at alarming rates gold, and gold miners will be a buy again at important support levels.

InTheMoneyStocks

 

[InTheMoneyStocks]

Oil Refiner Stocks Gain Again. How Much Is Left In The Tank?

Since late August when the Federal Reserve Bank Chairman Ben Bernanke announced his quantitative easing plan the entire stock market has inflated sharply higher. One industry group that has soared higher has been the oil refiner stocks. This sector has seen very significant gains and remains strong even today.

Tesoro Corp.(NYSE:TSO) is a leading oil refiner that can refine both heavy and light crude. This stock has rallied higher by nearly 80.0 percent since late August 2010. It is important to realize that oil and gasoline have climbed sharply higher from that time helping the refiner stocks profit margins. Tesoro stock will have daily chart resistance around the $20.00 level. This is an area where institutional profit taking is likely to take place.

Valero Energy Corp.(NYSE:VLO) is another leading oil refiner that has surged higher by over 50.0 percent since late August 2010. Valero Energy Corp. remains in a strong technical uptrend on the charts at this time. However, the $25.00 area should be very strong resistance and a likely pullback level. Often after such a robust move higher these stocks will eventually come under some selling pressure by the major institutions.

Sunoco Inc.(NYSE:SUN) is one of the major oil refiners that is actually trading into important daily chart resistance around the $41.50-$42.00 area. This stock still looks strong on the charts by trading above all the important moving averages. However, this stock may see profit taking at anytime now.

Frontier Oil Corp.(NYSE:FTO) has been one of the strongest oil refiner stocks in the sector. This stock has rallied higher by nearly 60.0 percent since late August 2010. The next important resistance level for Frontier Oil Corp. will be around the $20.00 level. However, there is some minor daily chart resistance around the $18.50 area, therefore, a pullback in the stock could take place at anytime

The oil refiner stocks have had one heck of a rally along with most everything commodity related. As long as crude oil remains strong these stocks should hold up. However, most of these stocks in this sector are now approaching important resistance levels and a pullback or correction for these stocks could be very close.

Nicholas Santiago

 

[InTheMoneyStocks]

Chevron And Exxon Strong As Oil Falls Signals Just New Money

Oil is getting hammered today. The United States Oil Fund LP (NYSE:USO) is trading at $38.03, -1.02 (-2.61%). While oil is down sharply, Chevron Corporation (NYSE:CVX) is trading just slightly lower while Exxon Mobil Corporation (NYSE:XOM) is trading at $74.93, +0.38 (+0.51%), solidly higher. Many amateur investors would look at this as a bullish sign for both stocks but I beg to disagree. The beginning of the year always sees new money flowing into the biggest stocks and the best winners. The fact that both these stocks are strong in relation to oil is only due to the fact that new money is looking for a home. This new money is propping both stocks up for the time being. It should subside by tomorrow and if oil continues to be weak, look for further downside action. Both XOM and CVX are extremely extended on their charts and both due for a pull back as well. Look for a solid pull back on both in the coming weeks.

Gareth Soloway
InTheMoneyStocks

 

[InTheMoneyStocks]

It's Funny How We Get The Perfect Job Number

Earlier this week on January 5th, 2011 the payroll processing company ADP reported that the U.S. economy had added 297,000 jobs. The economists went wild raising the expectations of today's government non-farm payroll report to over 200,000 jobs. However, today the job report was released at 8:30 am EST and the U.S. Labor Department only reported a headline number of 103,000. This is quite a disappointment for all those who thought the economy was adding much more jobs as the ADP report suggested.

It is important to note that all of these reports cannot be trusted. Even in modern times with all the wonderful technology in the world it seems that the readings when it comes to economic data should be taken with a grain of salt. All that really matters is if the Federal Reserve Bank will continue with it's U.S. Treasury purchases called QE-2. As long the central bank continues to create capital reserves by buying bonds and keeps the fed funds rate at zero percent the economy will inflate overall. That has been seen throughout history.

Investors should just look at when the former Federal Reserve Bank Chairman, Alan Greenspan, lowered the fed funds rates(overnight lending rate to large major banks) to 1.00 percent in 2002. The economy inflated higher for five straight years. However, once interest rates began to increase the economy had already created one of the biggest bubbles in recent times. That was obviously the housing and credit bubble of 2007-2008. We can only wonder how bad this bubble will be that is being created now?

The Federal Reserve Bank tells us that there is no inflation. However, the economies in Asia are trying to fight inflation. If this is a global economy how could one part of the world have inflation and the other part have no inflation? It is simply because of the labor market and the fuzzy math that is used by the economists. When a country has high unemployment there is never signs of inflation. However, if one looks at the price of copper, gold, silver, gasoline, oil, or food they will easily see that there is inflation. Leading commodity stocks such as Freeport McMoRan Copper & Gold Inc.(NYSE:FCX), Southern Copper Corp.(NYSE:SCCO), Silver Wheaton Corp.(NYSE:SLW), and many others are trading at or near all time highs.

You see today's weaker than expected job number gives the Federal Reserve an excuse to say that we need to continue their quantitative easing program. Remember quantitative easing is the catalyst for the rally as traders and investors continue to buy the dip. If today's government job report would have been near 300,000 new jobs the U.S. Dollar would have spiked along with higher U.S. Treasury yields. This would have caused a major sell off. Therefore, you can see how a not so good or even a disappointing job number can be good for the stock market. It's simply amazing how this all works.

Nicholas Santiago
InTheMoneyStocks

 

[InTheMoneyStocks]

Hot Stocks Watch List

The theme of this weekly market report will be popular stocks. The stocks that are featured this week are held by both the institutional money and the public. These stocks are are well known throughout the trading community. It would be prudent to watch the important levels pointed out in these stock market leaders.

Skyworks Solutions, Inc. (NASDAQ:SWKS) is a leading semiconductor and integrated circuit maker that is used in many cellular devices and smart phones. The stock has been in a strong weekly uptrend that began in early 2009. The daily chart remains very strong and indicates some more upside potential. However, the weekly chart is beginning to get a bit extended and should be nearing important resistance levels around the $32.50, and $35.00 levels. This is where traders and investors should look for pullbacks or institutional profit taking to occur.

Silver Wheaton Corp. (NYSE:SLW) is a leading metals streaming company. The company currently has fifteen silver purchase agreements and two precious metals agreements. The agreements detail that in exchange for an upfront payment the company has the right to purchase all or a portion of the silver production, at a low fixed cost from high-quality mines located around the world. The stock has soared higher throughout 2010, however, on December 7, 2010 a near term top was made at $42.34 a share. Since that time the stock has sold off or corrected by nearly 10.0 points. There will be short term daily chart support around the $33.25 area. The strong weekly chart support levels are $27.50, and $24.50. Traders and investors should watch for bounces around all of these levels.

One of the leading casino and resorts stocks is MGM Resorts International (NYSE:MGM). The stock surged sharply higher on January 7th, 2011 along with the other leading stocks in the sector such as WYNN Resorts, Limited. (NASDAQ:WYNN), and Las Vegas Sands Corp. (NYSE:LVS). It is important to realize that MGM was the weakest stock of the casino leaders before late August 2010. That was when the Federal Reserve Bank announced its quantitative easing or U.S. Treasury purchasing program. At that time almost every leading stock that was lagging began to rally. Remember, a rising tide lifts all boats. Since August 31st, 2010 MGM has rallied higher by 65.0 percent. The stock will face important resistance around the $17.25, and $19.00 levels. Traders and investors should watch for pullbacks around these price areas.