• Home
• Our Mission
• Recent Opinion’s
• Disclaimer

Subscribe

CAUTION: XLF, WLT, CHK

If not for the Fed on Wednesday, I would say short WLT, and CHk right here and extreme caution in this range on XLF. AAPL cleared the possible reversal attempt attempt early on and took out that play. it had to clear Friday’s low to “technicially” put a short on, and it never even came close. Not exactly sure where this strength in AAPL is coming from as their numbers do not support this strength, IMO. But you have the “AppleHeads” that want to own this stock. Volume has dropped dramatically in the last 2 days on Apple however, so this rally is weak, at best. AEM fell again, not a shock at all. The Cramer heads are going to be beat to BK on his call to be long at the highs. If the dollar firms, AEM could easily see $35. Big if, I know. 

The Fed decision on Wednesday takes all plays off the board, basically, as it is going to move afterward, most likely. But be careful here.

The Market Is Likely To Stay In A Tight Range Pre-Fed

There really isn’t going to be much to say and probably no clear direction until after the Fed decides late Wednesday. All movements prior are likely to be meaningless anyhow as volatility may once again pick up. Best thing is probably say the course until we see outcome and direction.

The Bias Should be Positive Early

We would have to get under 1394 early to cause problems it appears. We have a reversal off the opening high of 1401.50. If we get over that, we should push higher. 2 Day Fed meeting starts tomorrow….this could be slowwwwww today…

Morning Call: No News Today, Lowes, RadioShack Misses, Sideways Possible

No news today. No big earnings releases. Lowes and Radio Shack did miss. I have repeatedly warned to avoid anything that relies on the U.S. consumer. Therefore virtually all retailers are an avoid, IMO.

AEM Is Not Out Of The Woods By Any Stretch, Cramerica Sheep Take Another Beating

How are the Cramerica Sheep liking his call to be long AEM AT THE HIGHS when I warned against it - repeatedly. AEM is STILL in trouble here. If it cannot take out the all time high, then testing the December 07 low of $45.55 is not impossible. That is the only key number to be long AEM above here. I have warned many, many times to avoid this stock. I feel bad for the guy that called in to Mad Money the day after AEM made it’s all time high, and Cramer’s advice was to “buy more”. That post is on here if you do a search of AEM. In that post I said buy more??? AEM is a SHORT …not a double down.

 If you invest on what you “believe” is likely in the macro future, like Cramer’s call that gold is going to $1600, and ignore what the market is saying, you are gambling. it is that simple. AEM clearly was a short below it’s high and his advice to “buy more” is simple stupidity.

XLF And Financials: Very Skeptical Long Term, But A Major Short Covering Rally Is Possible Here

XLF and the market in general appears poised to possibly make a gap higher here. $27.17 is a key number on XLF and it is nearing it and it may take it out Monday or soon. If it takes it out and does not immediately reverse, then it appears that we could explode to the upside here. There really is nothing to stop the SP from moving higher here. (other than economic reality, that is, but let’s not let facts get in the way of making money)…..

Goldman cleared a key number on Thursday as I mentioned, and has led to the recent spike. I do believe GS will likely reverse near $200 however, so careful on this euphoria. If we get much over $27.17 and do not reverse, and certainly if we clear $27.37 on XLF, it appears that it could make a run to $30.00 on a major short covering push. There is MASSIVE short intererest in XLF and financials (for good reason) ….IF they ever begin to cover, it will make a major one day push.

Was Right On Both CHK and UPS, WLT Is Still An Avoid Here

I said Thursday night that I did not believe we had seen the highs in CHK and that weakness should be bought. Up 5.6% on Friday. UPS only moved down .05 cents, but it did so in a reasonably big market rally. WLT is still and avoid as it needs to clear the high to be long up here and the stock seems somewhat overvalued anyhow. The stock is overvalued relative to CHK, and that is why I said if you want to be long the energy space, CHK was a better play here. CHK was up 5.6% while WLT was only up 3.74%. An extra 2% move by swapping out and going with CHK as I recommended.

Caution On AAPL Here

I do not like AAPL at these levels and it has to clear Friday’s high to be long here. The risk reward on AAPL up here seems marginal, at best. The easy money on this stock has been made off the low of which I said to be long. I am not big into analyzing sales/revenue and all that as i let the market tell me what they think of it as that is all that matters, but Ipod sales only increased 1% year over year. They have to come up with something new…and big….or the stock is overvalued, IMO. While Jobs seems to always come up with something huge…caution on AAPL up here.

If you are a trader, the trade is to short AAPL here with a hard stop above today’s high. My only concern about being short is that the market continues to show strength and the SP chart still says higher before lower. I would rather get a market reversal AND an AAPL reversal to really put some pressure on.

The Strength In The Market Has Been Surprising

I have mentioned that i am normally skeptical of any highs or lows that do not have firm reversals, so it doesn’t completely surprise me that we are pushing higher as no reversal has been made recently. With that said, the market is completely ignoring reality - the economy is going to get worse. I think people are hoping the $600 checks being mailed out will solve consumer problems, it won’t.  The reality is that AT BEST it will simply stall them for maybe 2 months. Do not argue with the market, but understand that these moves higher are most likely not warranted by any sense of economic reality. Consumer spending is going lower, probably much lower, because they cannot service existing debt levels. That will not change with a $600 check when the average US consumer has a $10,000 credit card balance that most cannot pay. Not to be redundant, but this is a fundamental problem, NOT a cyclical one, as in the past downturns.

Here are the facts:

Consumer confidence plunging

Housing numbers are at record low

Consumer debt levels at all time highs

Home values are going lower

Inflation is grossly understated and is having a big effect on discretionary spending

Real wages have not budged in 10 years and are going negative

All, of this is NOT good and will not change anytime soon.

 So, take what you can, when you can….Jack be Nimble, Jack be Quick…. on the trigger…is still my motto here.

Consumer Confidence Plunges Again

Consumer confidence just came out, plunged again which is not surprising. It looks a little early to chase it down here around 1388….We need to get undet that and hold to maybe put some pressure on here… Even then it may bounce near 1384 or so…so this looks like a mixed bag…for now…

« Previous Page — Next Page »

Our Mascot Trading Goal: Ferrari 599



Other Investment and Trading Thoughts

• Recent Commentary

  • Site Update: It Has Been Fun, But Closing It
  • Morning Call: Open Sold
  • Market Recap: GM News Was Not Really A Deal, Dow Low Cleared Late and Down She Goes
  • Morning Call: Open Sold, Dow 7773
  • Market Call Revisited: Sell Asia
  • Market Recap: Not Good
  • Market Update: Doesn’t Look Good, 818 and 826
  • Market Recap: Buyers Above 818
  • Morning Call: Open Gap Bought
  • Market Recap: Buying On A Big Number, Now What?
  • Morning Call: Still Uncertainty
  • Market View: GM Holds The Cards
  • Stock Charts VS Market Charts
  • Market Recap: Somewhat Predictable, Low Came Where I Said Was Likely
  • Morning Call: Unclear, Risk Is High
  • Huge Rally: Now What
  • Market Comment: Does News Even Matter?
  • Market Recap: Close Day Craziness

Copyright © 2007 StockBlade.com · · Login

\