We are a bit crazed the next two days. If you want to access today or tomorrow, then go to www.superstockinvestor.com and sign up for our free Morning Briefing which includes the Daily P/Laybook within Market Matters. We will be back here next Monday.
Comments »
Joined Dec 4, 2012
319 Blog Posts
How To Avoid Getting Clipped In Stocks Like GTAT
At Erlanger Research, we use a really simple indicator to determine the bias. Bias tells us whether we want to be long or short. If the bias is positive, then we do not short. If the bias is negative, then we do not buy.
It is really that simple. Unfortunately, humans have a widget in the back of their head telling to them to try and catch a bottom or top. There is no need to do that if you have the power of the Displaced Moving Average (DMA) Channel we use to set the bias. The DMA Channel can be found in our software as well as on Bloomberg and NinjaTrader.
In the case of GTAT, the stock has not been able to move above its monthly DMA Channel. We are a buyer when we close the month above the DMA Channel and a seller when we close the month below the DMA Channel.
We have a buy signal that made 67.56% and the current sell has made 66.70% on the short side for a combined return of 134.26% . The software for this chart can be found at www.erlangerchartroom.com and www.goodmorningwallst.com. We offer both individual and institutional version as well as real time via eSignal and Bloomberg.
There is one big caveat to the DMA Monthly Channel. It does not do a good job on stocks with low beta. Betas above 1 it works fine. Ultimately, bias needs to be used in conjunction with setup and trigger indicators. Our setup indicators include short interest, options and seasonal trends. Triggers are technical indicators that help on the timing of the trade. The use of bias, setups and triggers is a must for any trader.
Comments »
Daily P/Laybook Futures Lower
In After Hours Trading
BMI (-.30) CSX (+.05) INTC (IN LINE) IBKR (-.09) LLTC (+.02) MRTN (+.05) URI (-.30) YHOO (+.13).
Several IPOs are due Blackhawk Network, Fairway Group, Hannon Armstrong Sustainable, Intelsat Global Holdings, SeaWorld Entertainment and Taminco Chemical.Secondary offerings none of note. Courtesy of www.ipofinancialreport.com.
What’s Happening This Morning
US futures: (S&P -12, Dow Jones -100, NDX -23.00 with fair value higher, which will hurt the opening even more) Asia lower ex Japan and Europe lower. Copper and gold lower with WTI Crude and Brent Oil Futures lower. $ is higher vs Euro, higher vs. Pound and higher vs. Yen. US 10 year Treasury Yield -0.0172. Prices as of 7:55 a.m. EST.
Earnings Expected
Earnings due after the close EBAY AXP KMP SNDK SLM EPB NE CCK ALB EWBC STLD CVA LHO CYS CNS SCSS AF. Earnings due tomorrow morning among others PM VZ PEP TSM UNP UNH MS DHR BAX FCX BBT PG SHW OMC FITB NUE NOK APH BX KEY.
Rags & Mags: Inside Wall Street
We are big fans of www.247wallst.com summary of the newspapers each day. Going forward we will link to their website so you can read their summary, Media Digest
Reported Earnings This Morning
ASML (+.03) BAC (-.02) BK (-.02) DOV (+.01) HBAN (+.01) MAT (+.03) PNC (+.21) DGX (-.15) TXT (-.05) WNS (+.01).
Data Points
Yesterday saw 2494 stocks rise and 542 fall on the NYSE. NASDAQ saw 1923 risee and 555 fall. The S&P 500 is above its 50 day moving average and above the 200 day moving average. The Russell 2000 broke back below its 50 day moving average on Monday. The 10 day spread moving average of breadth is now negative but above -200. We moved to cash on the Madison Market Timing Indicator on February 22nd which can be found on www.superstockinvestor.com.
Economics
The Federal Reserve Open Market Committee releases its latest Beige Book survey. The International Monetary Fund (IMF) releases its Global Financial Stability Report.
Weekly Crude Inventories are due out at 10:30 a.m. EDT.
Politico
Federal Reserve St. Louis President Bullard speak about unemployment in New York City. Also Federal Reserve Governor Stein and Federal Reserve Boston President Rosengren speak today.
Conference & Analyst Meetings
Analyst meetings none of note. CIBC Energy Conference.
Conference of Note
World Vaccine Congress & Expo.
M & A News
Key Upgrades and Downgrades
| Firm | Upgrades | Downgrades |
|---|---|---|
| JP Morgan | ||
| Goldman Sachs | ||
| Morgan Stanley | ||
| Deutsche Bank | ||
| Citigroup | OC | |
| Merrill Lynch | YHOO | |
| Wachovia/Wells Fargo | ||
| Credit Suisse | POM |
How Much Of A Pullback Ahead?
How much of a pullback can we expect? We look to our retracement tool to give us a sense of how much of a pullback we can expect.
![[Image 1]](http://web02.data55.net/ssi/images/mbr/morningmatters/2013-04-16/1.gif)
A retracemen is drawn from a low to a high. In the chart above, we have drawn the line from both the December low and November low. At a minimum, we now can expect a 38% pullback to 1521.24 or 1501.70.
A more realistic number is a 50% pullback, which is either 1497.73 or 1471.40.
The S&P 500 peaked at 1593.37 so a 5% pullback would take us to 1513.68 which is between the two 38% pullbacks.
A 10% pullback would take us to 1434.03. This would take us slightly beyond the 61.8% retracement levels that are 1474.22 and 1441.23.
Comments »Daily P/Laybook Futures Higher
In After Hours Trading
BRO (+.02) PBY (-.32) PNFP (+.06) STLY (-.04).
Several IPOs are due Blackhawk Network, Fairway Group, Hannon Armstrong Sustainable, Intelsat Global Holdings, SeaWorld Entertainment and Taminco Chemical.Secondary offerings none of note. Courtesy of www.ipofinancialreport.com.
What’s Happening This Morning
US futures: (S&P +12.25, Dow Jones +108, NDX +23.500 with fair value higher, which will hurt the opening but still a positive one) Asia lower ex Shanghai and Europe lower. Copper and gold higher with WTI Crude and Brent Oil Futures lower. $ is lower vs Euro, lower vs. Pound and higher vs. Yen. US 10 year Treasury Yield +0.0452. Prices as of 8:00 a.m. EST.
Earnings Expected
Earnings due after the close INTC YHOO CSX LLTC URI FULT CATY IBKR BMI MRTN. Earnings due tomorrow morning BAC ABT PNC ASML MAT DOV STJ DGX TXT HBAN among others.
Rags & Mags: Inside Wall Street
We are big fans of www.247wallst.com summary of the newspapers each day. Going forward we will link to their website so you can read their summary, Media Digest
Reported Earnings This Morning
BLK (+.05) KO (+.01) CMA (+.02) NTRS (-.01) WAFD (+.01) WWW (+.26).
Data Points
Yesterday saw 376 stocks rise and 2683 on the NYSE. NASDAQ saw 277 risee and 2245 fall. The S&P 500 is above its 50 day moving average and above the 200 day moving average. The Russell 2000 broke back below its 50 day moving average on Monday. The 10 day spread moving average of breadth is now negative but above -200. We moved to cash on the Madison Market Timing Indicator on February 22nd which can be found on www.superstockinvestor.com.
Economics
March CPI is due out at 8:30 a.m. EDT and is expected to drop to 0.0% from 0.7%. March Housing Starts are due at 8:30 a.m. EDT and expected to rise to 930,000 from 917,000. Then at 9:15 a.m. EDT March Industrial Production is due out and is seen dropping to 0.2% from 0.8%.
Politico
Federal Reserve New York President Dudley will speak about the economy in New York City. Also on Tuesday Federal Reserve Vice Chairman Janet Yellen will speak on monetary policy before the IMF.
Conference & Analyst Meetings
Analyst meetings none of note. IPAA OGIS New York Conference. CIBC Energy Conference.
Conference of Note
World Vaccine Congress & Expo.
M & A News
Key Upgrades and Downgrades
| Firm | Upgrades | Downgrades |
|---|---|---|
| JP Morgan | CHRW | |
| Goldman Sachs | MRIN | |
| Morgan Stanley | ||
| Deutsche Bank | ||
| Citigroup | OC | NKA |
| Merrill Lynch | DCT | TCP |
| Wachovia/Wells Fargo | ||
| Credit Suisse | ||
| Banc of America | ||
| UBS | ||
| Raymond James | ||
| ING Group | AKZOY | |
| Jefferies | SRCL | |
| KeyBanc Capital | ||
| Sun Trust Robinson Humphrey | HZO |
Taking Gains On CMG Recommendation
We are taking gains on CMG in front of earnings this week. The stock has had a good run and hedgies David Einhorn and Jeffrey Gundlach are targeting this as a short. We do not like high profile stocks and this is going high profile. We will be locking in our Morning Matters portfolio as well which can be found on www.superstockinvestor.com.
| SYMBOL | SIGNAL | DATE | ENTRY | CURRENT | P/L | % CHANGE | CLOSE |
| CMG | LONG | 12/18/2012 | $ 288.01 | $ 346.14 | $ 58.13 | 20.18% | Close |
| TASR | LONG | 12/17/2012 | $ 7.67 | $ 7.92 | $ 0.25 | 3.26% | |
| ABFS | LONG | 1/28/2013 | $ 11.04 | $ 10.78 | $ (0.26) | -2.36% | |
| 21.09% | |||||||
| SWHC | SHORT | 12/17/2012 | $ 9.26 | 8.70 | $ 0.56 | 6.05% | |
| RGR | SHORT | 12/17/2012 | $ 46.40 | 48.90 | $ (2.50) | -5.39% | |
| FXI | SHORT | 3/4/2013 | $ 37.71 | 35.35 | $ 2.36 | 6.26% | |
| 6.92% | |||||||
| Closed | |||||||
| P | LONG | 12/4/2013 | $ 8.91 | $ 11.74 | $ 2.83 | 31.76% | 2/1/2013 |
| AMD | LONG | 12/10/2012 | $ 2.35 | $ 2.52 | $ 0.17 | 7.23% | 3/27/2013 |
| NSC | LONG | 1/4/2013 | $ 65.25 | $ 75.39 | $ 10.14 | 15.54% | 4/3/2013 |
| 54.54% |
Daily P/Laybook
In After Hours Trading
No earnings Friday after the close of note.
Several IPOs are due Blackhawk Network, Fairway Group, Hannon Armstrong Sustainable, Intelsat Global Holdings, SeaWorld Entertainment and Taminco Chemical.Secondary offerings none of note. Courtesy of www.ipofinancialreport.com.
What’s Happening This Morning
US futures: (S&P -6.50, Dow Jones -42, NDX -10.80 with fair value higher, which will hurt the opening) Asia lower and Europe lower. Copper and gold lower with WTI Crude and Brent Oil Futures lower. $ is higher vs Euro, higher vs. Pound and lower vs. Yen. US 10 year Treasury Yield -0.0137. Prices as of 8:00 a.m. EST.
Earnings Expected
Earnings due after the close BRO PNFP PBY STLY. Earnings due tomorrow morning JNJ KO GS USB BLK GWW NTRS AMTD CMA MMR WWW HTLD among others.
Rags & Mags: Inside Wall Street
We are big fans of www.247wallst.com summary of the newspapers each day. Going forward we will link to their website so you can read their summary, Media Digest
Reported Earnings This Morning
C (+.12) LAYN (-.12).
Data Points
Yesterday saw 1154 stocks rise and 1806 on the NYSE. NASDAQ saw 1006 risee and 1473 fall. The S&P 500 is above its 50 day moving average and above the 200 day moving average. The Russell 2000 broke back above its 50 day moving average on Monday. The 10 day spread moving average of breadth is positive. We moved to cash on the Madison Market Timing Indicator on February 22nd which can be found on www.superstockinvestor.com.
Economics
Releases of note this week include weekly chain store sales, oil/gas numbers, mortgage applications and jobless claims along with CPI, housing starts, industrial production, leading indicators and the Philly Fed Survey.
Politico
Minutes are due from the Reserve Bank of Australia (RBA) Monday night.
Conference & Analyst Meetings
Analyst meetings none of note. IPAA OGIS New York Conference. Supreme Court of hear MYGN gene patent issue.
Conference of Note
M & A News
TMO to buy LIFE for $75 a share. DISH extends bid for S, $4.76 cash and 0.05953 share of DISH per share)
Key Upgrades and Downgrades
| Firm | Upgrades | Downgrades |
|---|---|---|
| JP Morgan | ||
| Goldman Sachs | ||
| Morgan Stanley | VAR FCX | |
| Deutsche Bank | ||
| Citigroup | XRAY | HMY |
| Merrill Lynch | ||
| Wachovia/Wells Fargo | ||
| Credit Suisse | ||
| Banc of America | ||
| UBS | ||
| Raymond James | ||
| Societe Generale | ||
| Jefferies | ||
| KeyBanc Capital | ||
| Sun Trust Robinson Humphrey | AVIV | |
| Raymond James | ||
| Credit Agricole | ||
| Dahlman Rose | ||
| Keefe Bruyette | ||
| Friedman Billings | ||
| Robert W. Baird | ||
| Needham | TTPH |
Daily P/Laybook Futures Lower
In After Hours Trading
JBHT (-.03).
Several IPOs are due Evertec and Rally Software are due today and CSTE CHUY CACC CUI DRTX LTD will price secondary offerings. Courtesy of www.ipofinancialreport.com.
What’s Happening This Morning
US futures: (S&P -5.00, Dow Jones -38, NDX -11.80 with fair value a bit higher, which will hurt the opening slightly) Asia lower and Europe lower. Copper and gold lower with WTI Crude and Brent Oil Futures lower. $ is higher vs Euro, higher vs. Pound and lower vs. Yen. US 10 year Treasury Yield -0.047. Prices as of 7:55 a.m. EST.
Earnings Expected
No earnings due after the close. Enjoy the weekend its Miller Time.
Rags & Mags: Inside Wall Street
We are big fans of www.247wallst.com summary of the newspapers each day. Going forward we will link to their website so you can read their summary, Media Digest
Reported Earnings This Morning
JPM (+.20) WFC (+.09).
Data Points
Yesterday saw 1849 stocks rise and 1160 fall on the NYSE. NASDAQ saw 1188 rise and 1236 fall. The S&P 500 is above its 50 day moving average and above the 200 day moving average. The Russell 2000 broke back above its 50 day moving average on Monday. The 10 day spread moving average of breadth is positive. We moved to cash on the Madison Market Timing Indicator on February 22nd which can be found on www.superstockinvestor.com.
Economics
March PPI and retail sales are due out at 8:30 a.m. EDT and are expected to drop to -0.2% from 0.7% and 0% from 1.1%. Then at 9:55 a.m. EDT April Michigan Sentiment is due and is expected to rise to 78.8 fro 78.6.
Politico
EU Finance Ministers meet in Dublin, Ireland with Cyprus as the lead topic.
Federal Reserve Boston President Rosengren speaks before the market opens. Federal Reserve Chairman Bernanke speaks at 12:30 p.m. EDT.
Conference & Analyst Meetings
Analyst meetings IMGN.
Conference of Note
M & A News
Key Upgrades and Downgrades
| Firm | Upgrades | Downgrades |
|---|---|---|
| JP Morgan | BAESY | |
| Goldman Sachs | ||
| Morgan Stanley | ||
| Deutsche Bank | ||
| Citigroup | ||
| Merrill Lynch | MPW | |
| Wachovia/Wells Fargo | ||
| Credit Suisse | ||
| Banc of America | ||
| UBS | ||
| Raymond James | ||
| Societe Generale | ||
| Jefferies | ||
| KeyBanc Capital | ||
| Sun Trust Robinson Humphrey | KRA | |
| Raymond James | PL | |
| Credit Agricole | ||
| Dahlman Rose | ||
| Keefe Bruyette | ||
| Friedman Billings | ||
| Robert W. Baird | ||
| Needham | NMRX |
Update On High Beta Versus Low Beta & The Russell 2000 Versus S&P 500
Our tracking of High Beta to Low Volatility and Large Cap to Small Cap shows both High Beta and Small Cap lagging a week later after our initial post here. We noted lat week, “If this trend continues, then it is almost a guarantee of a correction.” We continue to believe that. The market is being lead by the mega caps.
We track the Powershares S&P High Beta (SPHB) versus Powershares S&P Low Volatility (SPLV). SPHB is down on an absolute and relative basis since mid March. The same is true of the Russell 2000 versus the S&P 500.
Daily P/Laybook Futures Mixed
In After Hours Trading
APOG (-.02) RELL (-.02).
Several IPOs are due KNOT Offshore Partners LP and Taylor Morrison Home Corp are due today and RSO will price a secondary offering.Courtesy of www.ipofinancialreport.com.
What’s Happening This Morning
US futures: (S&P +0.25, Dow Jones +6, NDX -6.80 with fair value a bit lower, which will help the opening slightly) Asia higher ex Shanghai and Europe higher. Copper lower and gold slightly higher with WTI Crude and Brent Oil Futures lower. $ is lower vs Euro, lower vs. Pound and lower vs. Yen. US 10 year Treasury Yield +0.0047. Prices as of 7:55 a.m. EST.
Earnings Expected
Reports due after the close . Due tomorrow morning .
Rags & Mags: Inside Wall Street
We are big fans of www.247wallst.com summary of the newspapers each day. Going forward we will link to their website so you can read their summary, Media Digest
Reported Earnings This Morning
CBSH (-.01) IGTE (+.09) RAD (+.12) LEDS (+.05).
Data Points
Yesterday saw 2287 stocks rise and 730 fall on the NYSE. NASDAQ saw 1982 rise and 528 fall. The S&P 500 is above its 50 day moving average and above the 200 day moving average. The Russell 2000 broke back above its 50 day moving average on Monday. The 10 day spread moving average of breadth is positive. We moved to cash on the Madison Market Timing Indicator on February 22nd which can be found on www.superstockinvestor.com.
Economics
Federal Reserve Philadelphia President Plosser and Federal Reserve Saint Louis President Bullard speak. Weekly Jobless Claims due at 8:30 a.m. EDT.
Politico
G-8 Ministers continue a two day meeting in London.
Conference & Analyst Meetings
Analyst meetings AYR SNTS NVDA. Sun Trust Utica Shale Mini Conference, Bank of America Merrill lynch Testing, Inspection Certification and Assurance Conference and World Copper Conference.
Conference of Note
National Space Symposium.
M & A News
Key Upgrades and Downgrades
| Firm | Upgrades | Downgrades |
|---|---|---|
| JP Morgan | ||
| Goldman Sachs | DGX | SIAL MSFT |
| Morgan Stanley | ||
| Deutsche Bank | ||
| Citigroup | LNVGY | |
| Merrill Lynch | ||
| Wachovia/Wells Fargo | ||
| Credit Suisse | ||
| Banc of America | ||
| UBS | ||
| Raymond James | ||
| Societe Generale | IAG |
