InTheMoneyStocks Market Analysis

[InTheMoneyStocks]

Three Stocks Control The Entire Stock Market

If you ever wonder what type of day it is going to be in the stock market you can simply follow three stocks. When these three stocks trade higher on the session together the markets are likely going to finish positive. The opposite is true when these three stocks trade lower on the session, the major stock indexes will usually finish in negative territory. When these stocks are mixed then the markets are usually going to finish slightly higher or lower. The three most important stocks in the market are J.P. Morgan Chase & Co (NYSE:JPM), Exxon Mobil Corp (NYSE:XOM), and Apple Inc (NASDAQ:AAPL).

J.P. Morgan Chase & Co (NYSE:JPM) is the most important financial stock in the United States and possibly the most important financial stock in the world at this time. This stock is still the leading financial stock despite its recent trading loss that is be highly publicized. When JPM stock moves the markets listen. Today, JPM stock is trading higher by 0.08 cents to $34.39 a share.

Exxon Mobil Corp (NYSE:XOM) is the largest energy company in the world. The company has the second largest market capitalization in the entire stock universe at $377 billion. This stock is a major component of the S&P 500 Index and the Dow Jones Industrial Average. Today, XOM stock is trading higher by 0.56 cents to $81.19 a share. Short term traders should watch for intra-day resistance around the $81.37, and $81.75 levels.

Apple Inc (NASDAQ:AAPL) is the leading technology stock in the world. This company's growth has been responsible for putting companies such as Research In Motion Limited (NASDAQ:RIMM), and Nokia Corporation (ADR) (NYSE:NOK) into a possible bankruptcy. AAPL stock also moves the markets when it trades higher or lower as it is a huge part of the NASDAQ 100 and the S&P 500 Index. Every trader and investor must follow the action in AAPL stock as it is the largest stock by market capitalization in the world. Today, AAPL stock is trading lower by $1.41 to $570.75 a share. Short term traders can watch for intra-day support around the $569.40, and $564.00 levels.

Nicholas Santiago
InTheMoneyStocks

 

[InTheMoneyStocks]

Slow Motion Activity Ahead Of The Fed

The major stock indexes have not really moved all that much this morning. Many investors are now waiting for the Federal Open Market Committee (FOMC) meeting to conclude this afternoon. Most traders and investors are expecting the Federal Reserve Bank Chairman Ben Bernanke to keep the Fed funds rate (overnight lending rate to the large banks) at zero to a quarter percent. The Fed funds rate has remained at 0% - 0.25% since December 2008. So basically, the large banks such as J.P. Morgan Chase & Co (NYSE:JPM), Citigroup Inc (NYSE:C), Bank of America Corp (NYSE:BAC), and Wells Fargo & Co (NYSE:WFC) can borrow money at zero percent and lend it out at a higher interest rates, speculate on equities, and buy bonds with the money.

Many traders and investors are now expecting the Federal Reserve to implement another quantitative easing program or QE-3. The markets are already factoring in an extension of Operation Twist which is scheduled to end in late June 2012. This is where the Federal Reserve sells short term bonds and buys longer term maturities in order to keep interest rates artificially low. The today, the 10 year bond yield is trading around 1.66 percent. How much lower can yields go in 2012? That is a good question and we would ultimately expect lower. The 30 year fixed mortgage rate is 3.68 percent which is an all-time historic low.

So what would additional quantitative easing or money printing do for the economy? The answer, not much, but it will help to inflate asset prices and cause more inflation in goods that people need to survive. If the Federal Reserve Bank initiated another QE-3 traders should watch for a spike in commodities such as oil, gasoline, copper, gold, silver, platinum, steel, iron, and others. Some leading equities that could be volatile leading up to the FOMC announcement will be the United States Oil Fund LP ETF (NYSEARCA:USO), United States Gasoline Fund LP (NYSEARCA:UGA), iPath Dow Jones UBS Copper Total Return Sub-Index ETN (NYSEARCA:JJC), and the SPDR Gold Trust (ETF) (NYSEARCA:GLD).

Nicholas Santiago
InTheMoneyStocks

 

[InTheMoneyStocks]

The Real Reasons The Markets Flushed Today...

The markets are flushing dramatically today. The Dow, S&P 500 and NASDAQ are all down 2.3% on the day. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is trading at $139.80, -3.13 (-2.19%). The Dow Jones Industrial Average is having its biggest point decline in almost a year. All this coming on the day following the Presidential Elections where President Obama won a second term.

So why are the markets getting crushed? After all, polls favored Obama to win. This is not a huge shock to Wall Street.

There are multiple factors here. First, Wall Street is sending a harsh signal to the President. Ultimately, taxing the rich is on the table and likely to happen. In addition, short term capital gains and taxes on dividends are likely to go higher. This is a 'shot across the bow' from Wall Street, flexing their muscle and warning the President.

In addition, there is no longer an election to distract Wall Street from the Fiscal Cliff that lies right in front of America. The President has not been a friend to the Republicans and there is a major fear that no agreement on handling the Fiscal Cliff will be reached. This could cause a major market decline and a recession. Investors are running for cover on this fear.

Next, Europe seemed to be under a secret gag order into the elections. Did you notice how almost nothing emerged from Europe over the last few months? It is not a coincidence that Draghi, the head of the ECB emerged today and gave the world a reality check on how bad Europe is doing.

Lastly, Obama no longer has a need to keep a pretty image. He does not need the stock market to head higher so he can be re elected again. At this stage, less will be done to prop the markets up going forward.

This is going to be a wild time in the markets. There will be major ups and downs and swing traders will profit the most. As usual, long term investors will lose the most.

Gareth Soloway

 

[Depth Trade]

Re: The Real Reasons The Markets Flushed Today...

Perfectly stated, Americans have zero faith in Obama. We are going to see a repeat of '08/09 crash.

The markets are flushing dramatically today. The Dow, S&P 500 and NASDAQ are all down 2.3% on the day. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is trading at $139.80, -3.13 (-2.19%). The Dow Jones Industrial Average is having its biggest point decline in almost a year. All this coming on the day following the Presidential Elections where President Obama won a second term.

So why are the markets getting crushed? After all, polls favored Obama to win. This is not a huge shock to Wall Street.

There are multiple factors here. First, Wall Street is sending a harsh signal to the President. Ultimately, taxing the rich is on the table and likely to happen. In addition, short term capital gains and taxes on dividends are likely to go higher. This is a 'shot across the bow' from Wall Street, flexing their muscle and warning the President.

In addition, there is no longer an election to distract Wall Street from the Fiscal Cliff that lies right in front of America. The President has not been a friend to the Republicans and there is a major fear that no agreement on handling the Fiscal Cliff will be reached. This could cause a major market decline and a recession. Investors are running for cover on this fear.

Next, Europe seemed to be under a secret gag order into the elections. Did you notice how almost nothing emerged from Europe over the last few months? It is not a coincidence that Draghi, the head of the ECB emerged today and gave the world a reality check on how bad Europe is doing.

Lastly, Obama no longer has a need to keep a pretty image. He does not need the stock market to head higher so he can be re elected again. At this stage, less will be done to prop the markets up going forward.

This is going to be a wild time in the markets. There will be major ups and downs and swing traders will profit the most. As usual, long term investors will lose the most.

Gareth Soloway

 

[the hare]

Re: The Real Reasons The Markets Flushed Today...

Americans have zero faith in Obama.

Why on earth did they vote for him ?



Presumably they had even less faith in the alternative ?

It's a mystery why anyone would have faith in ANY politician, its about time they where eliminated and replaced by a random number generator.

 

[InTheMoneyStocks]

Price Action Signals Bottom In AAPL Near Term

The price action over the last few trading days in Apple Inc. (NASDAQ:AAPL) is signaling a near term bottom in the stock. The iPHONE maker has fallen from a 52 week high of $705.07 to low on Friday of $533.75. This is a drop of almost 25%. When looking for a bottom, the percentage drop means little. What means the most is the price action.

The price action on Apple has switched from bearish to bullish since last Friday. First, note the reversal on Friday. The stock tried to break lower and ended the day sharply higher, even with a late day swoon in the stock market. Today, the stock opened higher only to sell off. However, it has since rebounded. The low today was higher than the low on Friday. Higher lows are a bullish signal.

These signals, compiled with a 25% stock price correction and an overly bearish Wall Street signal a bottom is in the making in the near term. Upside could take the stock back to $600.00 in the near term.

Gareth Soloway
InTheMoneyStocks

 

[penguin941]

Re: Price Action Signals Bottom In AAPL Near Term

I'm letting it run low. With each new product AAPL falls!

 

[Trader6868]

Re: Price Action Signals Bottom In AAPL Near Term

I'm letting it run low. With each new product AAPL falls!

I think AAPL will bounce back before continue dropping...like DEAD CAT BOUNCE..

Today, just temporarily buy to cover and wait for right time to short again

Trader6868

 

[InTheMoneyStocks]

Forget 2012, You Should Worry About 2013

Traders and investors have been obviously selling this stock market since September 14, 2012. As we all know by now, on September 13, 2012 Federal Reserve Chairman Ben Bernanke announced his latest quantitative easing program labeled QE-3. This announcement by Chairman Bernanke certainly helped President Obama to get reelected. Many investors were feeling pretty good about the stock market back in September. Now investors are looking at possibly new tax hikes and weaker corporate earnings. If there is anything that the stock market hates it is new taxes and weaker earnings by public corporations.

A fair case can be made that the only reason corporate earnings have declined is because of the stronger U.S. Dollar Index. When the U.S. Dollar Index strengthens it has generally caused the stock markets to weaken. This inverse relationship between the U.S. Dollar Index and the major stock indexes has been in place for the past 11 years. The problem which the central banks have now is that the economy around the world is declining faster than the United States. This could actually keep the U.S. Dollar stronger against other currencies such as the Euro, British Pound, and others. Traders can easily take note of the recent strength in the PowerShares DB US Dollar Index Bullish (NYSEARCA:UUP). Should the UUP decline that is when traders will notice that the stock market will likely bounce and trade higher. The chart of the U.S. Dollar Index is clearly the most important chart that any trader can follow.

Where is the U.S. Dollar Index going to trade in 2013? This question is probably the most important question that any trader can ask themselves. Now you can see why this is one of the reasons it is so important to interpret and read the charts that carve out patterns of emotion by investors and traders. When I examine the U.S. Dollar Index it tells me that if the U.S. Dollar Index trades above the $86.00 level on the charts, that is when panic could really hit this stock market. Could this happen in the next year or two? The answer is yes, it is very possible that it could occur down the road. At least you all know the level on the U.S. Dollar that could cause panic in the global markets.

Some leading equities that trade inverse to the U.S. Dollar Index include Freeport-McMoRan Copper & Gold Inc (NYSE:FCX), SPDR Gold Trust (ETF) (NYSEARCA:GLD), ProShares Ultra DJ-UBS Crude Oil (NYSEARCA:UCO), and iPath Dow Jones UBS Copper Total Return Sub-Index ETN (NYSEARCA:JJC). You will notice that all of these equities are commodity related and that is usually the first equity group to be affected by the stronger U.S. Dollar.

Nicholas Santiago
InTheMoneyStocks

 

[InTheMoneyStocks]

Black Friday Looms: Retail Stock Charts Look Like Smelly Crap

As Black Friday looms, investors are taking a closer look at the retail stocks in hopes of finding the next gem. Today, the markets are trading flat which was widely expected after the monster rally yesterday. While things seem quiet, there is some major action in the retail sector.

Best Buy Co., Inc. (NYSE:BBY) is taking a beating after swinging to a third quarter loss on charges. The stock is trading at $12.14 -1.61 (-11.71%) and is hitting a new 52 week low. This retailer would not be one to mess with in the near term into Black Friday unless a bottoming tail is seen on the chart. It is cheap, but no reversal signal has been seen.

Before we get into a few other retailers, let's look at how the retail ETF is holding up. Merrill Lynch Retail HOLDRS ETF (NYSEARCA:RTH). The chart of the RTH has fallen off the 52 week highs. Last Friday, it kissed the 200 moving average which was major support. Since then, it has experienced a solid bounce back to the 50 and the 20 moving averages. Unless it regains the 20 and 50 moving average on a closing basis, the ETF is at resistance. It is wise to handle the RTH with care and keep a neutral on it based on these factors.

Looking at Tiffany & Co. (NYSE:TIF), American Eagle Outfitters(NYSE:AEO), Bed Bath & Beyond Inc. (NASDAQ:BBBY) I find myself without anything positive to say about the charts. This tells me the holiday season may be dissapointing in a major way. This almost makes perfect sense based on the Fiscal Cliff issue facing the entire market and economy. Think about it this way, if Americans do not know if their taxes will be going up next year, if the economy could spin into a new recession or worse due to the Fiscal Cliff, they are unlikely to spend. Therefore, the fact that retail stocks look horrible make perfect sense.

Gareth Soloway
InTheMoneyStocks

 

[InTheMoneyStocks]

Chinese Stocks Perk Up: Be Alert For More 80% Gainers

Chinese ADR's are finally waking up with a vengeance. These stocks have been in an arctic winter for years it seems as the Chinese economy has slowed and problems with accounting have mounted. These problems may be in the rear view mirror now and some of these stocks are trading at insanely cheap valuations.

Today, China BAK Battery Inc. (NASDAQ:CBAK) is ripping higher, trading at $3.12, +1.40 (81.40%). This is just one of the Chinese stocks pushing higher.

When stocks like CBAK start running on no news, you have to start watching other Chinese ADR's. An 80% move is something that is significant to any investor and if it is replicated in other Chinese stocks, you need to be a part of it. I will be alerting my members to any Chinese plays that look like they are going to blast higher.

Take the seven day free trial to the Research Center. Learn the PPT Methodology and become part of the elite. This methodology is proprietary in nature and gives 80-90% winning trade alerts in any type of market. Take the seven day free trial and start profiting with the pros today.

Gareth Soloway
InTheMoneyStocks

 

[InTheMoneyStocks]

President Signals Compromise: Holy Guacamole

The markets sold sharply early in the day as Fiscal Cliff worries continue to bubble up. In addition, Apple Inc. (NASDAQ:AAPL) collapsed lower, dropping to $545.56, a drop of $30.39. The iPhone maker continues to see end of year tax selling and worries over future growth after missing two quarterly earnings estimates in a row.

By mid-morning the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) was down to $140.37, a loss of 0.88. At this point the President came on television to make what seems to be his daily Fiscal Cliff update. For the first time since this fiasco began, his comments seem genuinely dovish towards reaching an agreement with Republicans. The market sensed compromise and began to rip higher. The SPY turned a 0.88 loss into a gain of $0.80, a whopping $1.68 reversal.

With compromise in the air, the market hopes to avoid the Fiscal Cliff. For the first time since this mess began, the President seemed to say "we can meet in the middle somewhere".

The charts spelled this move up out perfectly. Not only did the SPY hit key support at $140.45 but there was a perfect bottoming tail at the lows. A bottoming tail is a reversal signal and oh did the markets reverse. Upside intra day resistance on the SPY is at $142.05, $142.30 and $142.90. Downside support will remain as the low of the day at $149.37.

Gareth Soloway
InTheMoneyStocks

 

[London Minnow]

Re: President Signals Compromise: Holy Guacamole

Yes, Obama saying anything about the cliff at this point should make the S&P rise, but should this continue over the next week and a half, look for the diminishing effects and watch for the markets to turn negative when he talks.

Nice job on the analysis, it didn't end up breaking the 142.30 resistance, intraday.

 

[InTheMoneyStocks]

Will Bernanke Play Santa Again

This morning, the major stock indexes are all trading sharply higher to start of the trading day. On the surface, everything looks wonderful in the stock market. The highly followed Dow Jones Industrial Average is trading higher today by 86.00 points in the first thirty minutes of the session. Many traders and investors seem to be betting on another inflationary push by Ben Bernanke, who will be announcing his latest policy statement tomorrow.

The Federal Open Market Committee (FOMC) begins a two day meeting today. Tomorrow afternoon, the Federal Reserve will announce its interest rate policy for the United States. Chairman Bernanke will also hold a press conference tomorrow afternoon explaining his actions, while taking questions from the press. Many institutional traders are now expecting the Federal Reserve to announce another stimulus program since its current "operation twist" program is scheduled to expire. This past September, the Federal Reserve announced its latest quantitative easing (QE-3) program in which the Federal Reserve will purchase $40 billion worth of mortgage backed securities (MBS) a month.

The fed funds rate which is the overnight lending rate to the large banks such as J.P. Morgan Chase & Co (NYSE:JPM), Bank of America Corp (NYSE:BAC), Wells Fargo & Co (NYSE:WFC), and Citigroup Inc (NYSE:C) is currently at zero to a quarter percent. So there is really no expectation that the fed funds rate will change tomorrow. The Federal Reserve has already promised that interest rates will remain extremely low until late 2015. While low rates are good for people looking for loans, many people do not seem to qualify for loans any longer. So in reality, the savers in the United States seem to get punished as they will make basically zero interest by keeping their money in the bank. The fed funds rate has been at zero to a quarter percent since December 2008.

A fair case can be made that Chairman Bernanke has bailed out the politicians as they continue to spend money at an alarming rate. The U.S. national debt is now at $16.2 trillion and climbing. President Obama now wants the debt ceiling removed before the fiscal cliff deal is settled. Every citizen in the United States would need to pay $51,967.00 in order to pay off the current U.S. debt. Gross domestic product (GDP) remains between 2.0 – 3.0 percent in the United States, This number is rather weak when you consider all of the government spending. According to the Mercatus Center at George Mason University about 49.0 percent of all Americans receive some form of government benefits. These are troubling numbers that could be problematic over the next couple of years.

Traders should view this current stock rally as another inflation prayer by the financial institutions to the central bankers that control the money supply. Wall Street always loved a good inflation created stock rally. Lets see if Ben Bernanke will play Santa Claus to Wall Street and the politicians once again.

 

[The FCT]

Re: Will Bernanke Play Santa Again

So what does everyone reckon?

I think Goldman is predicting that Bernanke will replace Operation Twist with $40bn in Treasury buys per month..

But speculating on these fed announcements is never straight forward..

 

[InTheMoneyStocks]

These Markets Look Overbought Already

All of the major stock indexes are surging higher after the U.S. fiscal cliff deal was averted last night by the U.S. politicians. What most traders and investors should realize is that while the U.S. government did not go over the fiscal cliff there was really no grand bargain reached. This tells us that the next two months could be very turbulent for the major stock indexes as politicians will once again try to claim victory over the other party. After all, last night's vote to avert the fiscal cliff deal was really a win for the Democrats since it was the democratic controlled U.S. Senate that created the current fiscal cliff deal resolution in the first place.

Now the topics of the debt ceiling, spending cuts, extended unemployment compensation, the budget, and more will be debated over the next two months. The one thing that most people can agree on is if the politicians see the stock market decline for any considerable period of time they will usually be quick to act. For some strange reason the politicians do not like to see the stock market decline very much.

So for now, the major stock indexes are soaring on the trading session. The SPDR Dow Jones Industrial Average (NYSEARCAIA) is now approaching its most recent high made on December 19, 2012 at $133.70 a share. Today, the DIA is trading higher by $2.77 to $133.38 a share. Traders must watch for near term chart resistance around the $134.00 levels. In the meantime, leading stocks such as Apple Inc (NASDAQ:AAPL), Google Inc (NASDAQ:GOOG) are all climbing on the session. The home-builder stocks which were one of the strongest sectors in 2012 continue to rally higher as well on the session. This leading industry group looks to be trading right into near term daily chart resistance today, so further upside is likely to be limited. Leading home builder stocks such as Lennar Corp (NYSE:LEN), Toll Brothers Inc (NYSE:TOL), and D.R. Horton inc (NYSEHI) are all trading higher on the session, but near term daily chart resistance is now in play for the industry group.

The large financial stocks have been the leading stock sector in the market recently. This industry group continues to defy gravity climbing sharply higher again today. This sector is now looking slightly overbought, however, it is technically still in a confirmed uptrend.

We must now look for signals that the quick rally created by the politicians could be short lived. The truth of the matter is that the politicians could have actually made things worse for the economy. Traders should remember, the stock market usually trades ahead of the actual economy. Any stock market decline is just warning us of a weaker economy to come.
.

 

[Project.Sagana]

Re: These Markets Look Overbought Already

I think the QQQ is going down tomorrow. It's on a supply zone area and fill in the gap it made. I'm short on it. This opinion is based on technical analysis only.

 

[InTheMoneyStocks]

Screwing The Investor: Biggest Bubble Of Them All

In the last fifteen years, the United States has seen bubbles inflate and burst more often than anytime in history. There has always been a boom and bust cycle, yet in the last decade and a half this has happened once ever few years. The average investor should be extremely worried about this because these cycles destroy more of their wealth than anything else in the world. The average investor will buy into a bubble near the top, then ride it down until they sell at the lows. During the financial crisis, many investors lost their retirement savings. The same thing happened to some extent during the tech boom in the late 1990's. So why are we seeing more dramatic bubbles in the last 15 years?

The simple answer is government intervention, primarily the Federal Reserve. While the Federal Reserve is not part of the government, they act as their hand.

Let's look at an example of a cycle. Take the seasons. There are four seasons, spring, summer, fall and winter. Now what if you took spring and manually kept it all year round? Things would be beautiful, life would flourish...for a while. Yet nutrients would be eliminated from the soil, depleted as new life thrived early on. In no time at all, without new nutrients being put into the soil through death in fall and winter, a catastrophic collapse would occur. Soon life would wither and die regardless of spring. The ecosystem would collapse.

Another example would be changing the cycle of life in the human race. To some extend this is already being done through medicine. If you take away the prospect of death in the human race, overcrowding would ensue. Within years, mass starvation would occur and the pollution to the earth would create even more hardships. This can already be seen with hundreds of millions hungry around the world and global warming taking hold.

The bottom line is simple. Cycles are part of life, whether in nature or in the markets. When you mess with them you will screw things up even more. The Federal Reserve tries to limit the severity of recessions by intervening with monetary policy. While in the short run it may and often does help, it never outweighs the long-term consequences.

The best example can be seen right after the technology bubble collapsed. The Federal Reserve dropped interest rates dramatically and encouraged home buying for all. While it may have kept that recession slightly less severe, that action created the real estate and financial crisis.

To deal with the financial crisis and the Great Recession, the Federal Reserve has now printed trillions of Dollars. The way they do this is by pumping money into treasuries and artificially keeping interest rates at 0%. This is known as "Quantitative Easing". In addition, the government has taken on trillions in debt to help alleviate the harshness of the recession.

These actions, even more drastic in nature will have unbelievable consequences down the line. The next bubble is in the bond market, less than 5 years away from collapse. While many average investors do not think the bond market has much heading on their lives, it does. This is tied to inflation and interest rates. In other words, the price you pay for food, energy and everything else you buy may be double in just five years.

Please note that each bubble collapsing, is harsher than the last. This is mainly because each time, the Federal Reserve and government take on more drastic measures to get us out of the mess. The more drastic the measure, the bigger the next bubble created by these measures will be.

Recessions stink, no one wants them but they are a way of life. If left to their own doings, recessions would generally be minor. The more you screw with the natural course of things, the more you screw yourself, the American people and the world.. I plead with the Federal Reserve and government to start hearing common sense and realize screwing future generations will only send them to hell and make the history books curse their names.

Gareth Soloway
InTheMoneyStocks

 

[InTheMoneyStocks]

Here Is Why The Public Despises Wall Street

As we all know, the public has really not participated in the stock market since the 2008 credit and banking crisis. Since that point in time, the public has developed even more of a sour taste for Wall Street. Events such as the flash clash, LIBOR manipulation by the banks, high frequency trading manipulation, the MF Global bankruptcy, and of course all of the home mortgage scandals have caused protests, and almost a hatred for Wall Street by many in the public.

Mutual fund outflows have been occurring by the public investor for the past four years. Most hard working people now believe that the stock market is rigged by the large banks. Writers such as Matt Taibbi and others have demonized many of these large financial institutions for their antics and abuses that occur in the stock market all of the time. There are now many websites, bloggers, and publications that follow and track rules that are being broken by the large Wall Street firms all the time. Usually, these big firms just get a slap on wrist and continue with business as usual.

The bank bailouts since 2007 have caused outrage in the streets. The Occupy Wall Street movement started to take on a life of its own last year. Prior to the Occupy Wall Street movement was the Tea Party which stood up as a fighter of government bailouts. Texas congressman Ron Paul has been outspoken on the Federal Reserve Bank and other central banks around the world. Many people in the public are now wondering how printing money out of thin air can continue to prop up asset prices and help the economy. The Federal Reserve claims that its monetary policy will help create jobs and boost the economy. Others believe that the central bank is simply a way to help prop up the banks, which still have a lot of problems.

Here is another problem with these large banks which give Wall Street a black eye. It is the upgrading of stocks and indexes at extreme highs. Here are some examples, Goldman Sachs Group Inc (NYSE:GS) upgrades light sweet crude to $200.00 a barrel when it was trading around the $145.00 level in July 2008. A few days later oil tops out at $147.00 a barrel and plunges down to $33.00 a barrel in January 2009. Perhaps this upgrade was just an honest mistake. In August 2011, J.P. Morgan Chase & Co (NYSE:JPM) upgraded the price of gold to $2500.00 an ounce. Gold tops out in September 2011 at $1923.00 an ounce and falls as low as $1523.00 an ounce in December 2011. Perhaps this upgrade at a high was simply just another error by the so-called smartest people on the street. However, I sincerely doubt that. In November 2007, almost every major Wall Street firm was upgrading Google Inc (NASDAQ:GOOG) when the stock was trading over $700.00 a share. The projected price targets were over $1000.00 or more for Google stock. That stock dropped more than $300.00 points in just four months from that peak and even further throughout 2008. It seems that these Wall Street firms are really good at picking tops in leading stocks and commodities - sarcasm. Another recent example just occurred in Apple Inc (NASDAQ:AAPL) when the stock was trading around the $700.00 level in late September 2012. As many of you already know, the stock declined by $200.00 points in less that two months from that high. If you were following along with our analysis over the past five years, you would have been on the right side of the calls mentioned above. The most notable of which, the real estate and market bubble burst of 2007; we are well documented for alerting our viewers of this event well before it happened.

So the moral of the story is, learn how to use the charts and don't listen to anyone. The charts are the only reliable way to have a chance when it comes to trading these markets. Obviously, all of these large institutions need to have someone to sell to when it comes to these upgrades at extreme highs, otherwise it would make no sense to buy when everyone is already in the market. Who is left to push the stock or commodity higher? Why don't they ever seem to upgrade these equities at the lows? That is the million dollar question, we can only guess it is because it makes the big Wall Street firms millions and steals money from the uninformed individual investor.

Nick Santiago

 

[InTheMoneyStocks]

Risk VS. Reward Of Buying The Volatility Index (VIX)

The Volatility Index aka Fear Index is sitting near 12. This level has not been seen since 2007, prior to the financial collapse. While housing prices are not where they were, other bubbles have formed, mainly in the bond market. To see the VIX near 12 is scary to say the least.

So is it smart to invest in an ETF that tracks the VIX? Let's take a look at the VelocityShares VIX Short Term ETN (NYSEARCA:VIIX) and iPath S&P 500 VIX Short Term Futures TM ETN (NYSEARCA:VXX). Both allow you to play volatility but each carries with it additional risks. First, understand that each month these ETF's must roll over their VIX contracts. In doing so, there is some slippage that occurs. Like many double and triple ETF's, these will eventually go to zero over the long term. Because of this, they should only be used as short term trading vehicles, held for days or a few weeks.

If you only use them as short term vehicles, they are fantastic if you can read the market like a pro. This market is as complacent as ever. Retail investors are dumping money into the markets at record pace just like in 2007. There is an overlying feeling the Federal Reserve will always be there to bail out the markets with more money printing. While the VIX could see $10, the risk reward definitely favors the upside. I myself am scoping it out, looking for the proper entry for a small position in the next few days.

Gareth Soloway
InTheMoneyStocks