The Red Roadmaster’s Technical Report on the US Major Market Indices + ™ 22 November 2010
Featuring Crude Oil, Gold, and Forex Technical Up-dates
Vol. 112210 # 1 Copyright 22 November 2010
Date Line: Singapore
The Red Roadmasterâ„˘ Paul A. Ebeling, Jnr. Editor/Compiler/Analyst/Commentator
You can now subscribe to email updates and RSS feeds from Ebeling Heffernan Live Trading News Coming soon: real time Level 2 Stock Quotes You can also follow us on Twitter. Please go to http//twitter.com/EbelingHefferna and join in. Fall Edition # 10 Thanksgiving in the USA 22 November 2010 6.00 am US EDT Dear Reader, You can read my Market Reports, and Up to Date International News daily and weekly on www.livetradingnews.com , www.paulebeling.com , www.aseanaffairs.com I round up relevant global market news and technical analysis up-dated daily. + You can see many of my articles and commentary on Google News http//news.google.com/news/search?aq=f&pz=1&cf=all&ned=us&hl=en&q=paul+ebeling + seen on ASEAN Affairs www.aseanaffairs.com
Redâ€™s Bull and Bear Trade Alerts Red's Options Alert: Peabody Energy (NYSE:BTU) See them all at www.livetradingnews.com, www.ebeling-heffernan.com , www.paulebeling.com, www.aseanaffairs.com and www.redroadmaster.com
Re-cap of the US Stock Market Action for the Week ending 19 November 2010
Red's Bull Alert: the S&P broke above its 20 Day Moving Average after tapping below it earlier in the week.
Of Note: After a 13% run-up in September and October, the S&P 500 has slipped 2.1% in the last 2 weeks on concerns of tightening in China and debt woes in Europe. A financial aid plan to help Ireland cope with its battered banks will be unveiled next week, EU sources said on Friday. MRVL, DELL, SNDK, GM, CAT, EMC, TGT, GAP, ISLN On the Week: the major US stock indexes were flat to unchanged with the S&P up 0.04%, the DJIA + 0.1%, and the Nasdaq - 0.004% On the Day: The DJIA .DJI gained 22.32 pts, or 0.20%, to close at 11,203.55, the S&P 500 .SPX added 3.04 pts, or 0.25%, to close at 1,199.73, and the NAS .IXIC tallied up a + 3.72 pts, or 0.15%, to end the session at 2,518.12. The S&P 500 was just at 1,200, a Key psych level, and I expect to break above that mark and run to new highs on the year in to the Christmas Holidays. Marvell Technologies Group Ltd (NASDAQ:MRVL) rallied 6.1% to 20.09/shr after its revenue topped expectations, and SanDisk (NASDAQ:SNDK), which rose 3.9% to 39.98. The semiconductor index .SOX gained 1.6%. Also on the NAS, Dell Inc (NASDAQ:DELL) rose 1.7% to 13.90 after it raised its profit outlook. General Motors Co (NYSE:GM) eased 0.2% to 34.26 a day after its record-setting IPO. Separately, Harrah's Entertainment terminated its own IPO, citing market conditions. In economic data, retail sales brought good news. Total retail sales increased 1.2% in October (Briefing.com consensus +0.7%) on top of an upwardly revised 0.7% increase in September. Excluding autos, retail sales jumped 0.4% (consensus +0.4%) versus a 0.5% gain in September. All in all, the Retail Sales report is another key data point that suggests the US economy is on a growth path that holds potential to produce some positive surprises. The Consumer Price Index increased 0.2% in October (consensus +0.3%) while core CPI, which excludes food and energy, was unchanged (consensus +0.1%) for the 3rd straight month. On a Year-over-Year basis, CPI is up just 1.2%. Core CPI is up only 0.6%, which is the smallest increase in the history of the index, which dates to 1957, according to the Bureau of Labor Statistics Housing starts dropped 11.7% to 519,000 (consensus 600,000) and were revised 3.6% lower for September to 588,000. Building permits were up 0.5% in October to 550,000, yet that was below the consensus estimate of 570,000.
The latest initial claims report might not have produced much of a surprise relative to the consensus estimate, yet it has provided surprisingly good news for the labor market as claims held below the 450,000 level for the 2nd straight week.
Overseas news: Shanghai markets dropped 5% in 1 session at the end of the prior week, and had a session this week where the market lost 4% on speculation of an increase in rates. On Friday, China once again raised its banking reserve requirement. Ireland remained in focus on speculation regarding a possible rescue for the country. According to reports, Ireland is in ongoing talks with the ECB, EU and IMF about a possible aid package The treasury market had a busy week, with the 10 year yield spiking to 2.87% from 2.79%. Just 2 weeks ago rates were as low as 2.49%. Several US Fed officials have expressed opposition to the QE-2 efforts.
Volume and Breadth: About 6.86B/shrs traded on the NYSE, the AMEX and NAS, below last year's estimated daily average of 9.65B/shrs. Advancing stocks outnumbered decliners on the NYSE by 1,754 to 1,226, and on the NAS advancers beat decliners 1,461 to 1,179.
US Major Market Indexes Technical Analysis Date
Snap Shot of Major World Markets DJIA
Red's Bull Price Alert: Peabody Energy (NYSE:BTU) 21 November 2010 LTN's Pattern Recognition Analyst, Paul A. Ebeling, Jnr, today ID'd the start of a New Bullish Trend (NBT) for Peabody Energy. Peabody Energy (BTU) closed at 57.92 Thursday and opened Friday at 57.44. BTU traded at 59.24, up 1.32 (2.40%) on the day.
The low was 56.39 and the high 59.34. Volume: 4,304,860/shrs is below the average volume of 4,304,860/shrs. BTU is trading above its 50 and 200 Day Moving Average. My Technical Indicators augur Bullish price movement in here. BTU's 52 week low is 34.89 and 52 week high is 59.92, it has a P/E ratio of 24.40 and a dividend yield of 0.60%.
Overall Short Intermediate Long Very Bullish (0.56) Very Bullish (0.57) Very Bullish (0.52) Very Bullish (0.58)
Recent CandleStick Analysis Very Bullish Date Candle 19 Nov 2010 Bullish Engulfing Open Gaps Direction Date Range Up 18 Nov 2010 57.18 to 57.62 Up 18 Nov 2010 54.84 to 55.73
Support and Resistance Type Value Conf. resist. 60.56 3 resist. 59.76 2 supp 56.91 10 supp 54.61 4 supp 52.80 2 supp 50.53 2
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This Week on the USA Economic Front
November 23rd Tuesday GDP - 2nd Estimate, Q3 (08:30): 2.4% expected, 2.0% past GDP Deflator - 2nd estimate, Q3 (08:30): 2.3% expected, 2.3% past Existing Home Sales, October (10:00): 4.42M expected, 4.53M past Minutes of FOMC Meet, November 3 (14:00) November 24th Wednesday MBA Mortgage Application, 11/19 (07:00): -14.4% past Personal Income, October (08:30): 0.4% expected, -0.1% past Personal Spending, October (08:30): 0.5% expected, 0.2% past PCE Prices - Core, October (08:30): 0.1% expected, 0.0% past Durable Orders, October (08:30): -0.3% expected, 3.3% past Durable Orders -ex t, October (08:30): 0.4% expected, -0.8% past Initial Claims, 11/20 (08:30): 442K expected, 440K past Continuing Claims, 11/13 (08:30): 4280K expected, 4295K past Michigan Sentiment, November (09:55): 69.4 expected, 69.3 past New Home Sales, October (10:00): 312K expected, 307 past FHFA Home Price Index, Q3 (10:00): 0.9% past Crude Oil Inventories, 11/20 (10:30): -7.29M past ___________________________________________________________________________________
This Week on the Earnings Front in the USA The 7th and last week of this earnings season On Monday: Tiffany & Company (NYSE:TIF) reports on Monday, and Hewlett Packard (NYSE: HPQ) will release its numbers after the Closing Bell. This is a shortened Holiday week in the USA For the complete list go to: http://biz.yahoo.com/research/earncal/20101122.html __________________________________________________________________________________
The Most Asked Question Last Week The Big Q: Red, how much will I make as a successful trader in Stocks, Options, Forex and Commodities Futures?
The Big A: See my discussion below in Redâ€™s Edge and In the Trenches please. The Key is that a person can choose to believe or not believe, trust or not. The fact is that it is all just common sense and when applied diligently the risk is managed and lessened. The rest is up to you! The difference between winners and losers is that the winners take it seriously and they always add to their knowledge. They read, study, learn nuances, attend seminars, and sometimes use a coach or a mentor. Successful traders are not those who say coaching or seminars are too expensive. They understand that they can recoup such costs in a single trade.
Remember this; trading requires study, discipline and devotion. Yes, the risks can be high, but then, the rewards can be high too. Thinking before acting is critical in trading as in life. Those who fail to think before acting most often fail. Meanwhile, if you are paying attention and doing things right you can make good money in here, as most of the sellers are now out of the market, IMO. Do it well and you can win... Stay tuned... ____________________________________________________________________________________
Redâ€™s Edge and in the Trenches Last week I got this Question, Red, how much will I make as a successful trader in Stocks, Options, Forex and Commodities Futures? His bloke was a new player and right away he wanted to know how much he would make on a monthly basis. The fact is that no one can or could answer a Q like that one. What I did tell him is the most Day Traders are looser and that Day Trading is a Fools Game. Do not play in that mind set, you do and the odds are that at the end of each month you are in the Red. In trading the markets there are many factors to consider; its about the person, the capital, the risk tolerance, discipline skill, knowledge, strategies, time, and emotional makeup help determine success or failure and Green or Red at the end of the month. Add to all of the above market influences; they have a profound effect success or failure. Most players will find that it is easier to make money in some markets than it is in others. That's true even though there are strategies for success when the market is going up, when the market is going down, and when the market is going sideways. Before capitalizing on market direction a player (trader) needs to make an accurate assessment of the direction and have an exit strategy that gives some protection when a turns (reversal) happens. News has a huge influence on market moves, and is unpredictable. That's why it is called News. Sentiment also plays a part in the market's action. So, if the movement of a market is not 100% predictable, what about the movement of an individual stock? If we add all those factors together along with the relative abilities or inabilities of the player the possible monthly returns are infinite yes? So, the Big Q of how much will I make seems a valid one. First, one has to believe he can win to win or why attempt it. right? Now if a player knows that day trader's are for the most part losers, why do it. And how can anyone ever know he/her will be better than the large majority? So, I say do not Day Trade the markets, and that means any markets. Play it smart take a longer view, as the short one requires immediate and focused attention + all of the tools and intuition available, it is for the Professional and not the novice. In order to make money this is what one has to do period: start trading with real money. And if one does that right off the bat the money will be lost the question is only how much. So, starting out playing with real money is a poor choice from my POV.
The way to start is to paper trade and see how that goes. This kind of an exercise requires patience and is not the same as trading real money. But is does give the new player no cost practice and the opportunity to gain some understanding of the strategies and methodologies he entering. And, the conclusion is if the player is losing money paper trading he will likley lose when he puts real money at risk. The prudent thing to do is this: Do not trade real money until you at least can trade pretend money successfully first. Now, this is really important, even if one paper trades with success it does not mean that the novice's real money trading will succeed. Trading real money brings out strong emotions, and the discipline that can applied easily while paper trading suddenly can disappear as the money hits the line. The Key fact is that the ultimate answer comes when trading real money, but the approach to that answer is better found through steps not jumps. Having said all of that it is my suggestion to paper trade and only when you have shown yourself that you can be successful paper trading do you start to make real money trades. Start small with the real money trades and see whether you are doing as well as when paper trading, and if not learn why not. If the small trades work then the money can be increased using pre-determined money management principles that I always refer to in this column. Knowledge is Power! All the best, Paul A. Ebeling, Jnr. PS: if you look at yourself as a player/trader and you like doing it the it is Key to understand what makes you "tick" plus it is very helpful to understand the motivations for you actions and their timing in the entering and exiting positions. It is very important to strive to remove the emotion and focus on the business of trading the markets to win. When you acquire the discipline and the tools to remove the emotion you are on the way to winning and perhaps winning big. PE
A Key fact: 90% of Day Traders Lose. To succeed in trading a Player needs Knowledge Always remember that Knowledge is Power. The stock market is not gambling. It is disciplined work.
The Key to Stock Market Understanding We all know that markets and stocks go up and they go down. Players will have winning trades and losing trades. Individual trades do not determine if a trader is a success or failure. A losing trade can be a successful trade if the trader has followed the disciplined Plan and cut a loss timely. So, that being said and knowing that there will be times of drawdown for even the best trader, how is success measured in this business? Well, one way is to go back and look at steps along the path that brought you to trading. This will likely help you understand how well you are doing. Example: one of the first steps along the path to trading success was your learning how to use the computer, a basic skill that makes the work easier, faster and hopefully better, and it follows that improvements made in the steps along the path would likely improve overall success. Next is, have you completed and do you use a well-defined and controlled trading plan? And have you learned strategies to trade up down or sideways markets? Have you developed an exit strategy, whether you have a discipline to cut losses-whether you are dedicating time to education through reading, or seminars and/or have you structured your time to permit regularly attending to the business of trading? Hopefully you are getting more knowledgeable, as knowledge is Key. So, then take the time to look back from where you are now, so you can analyze the steps that you have taken so far, looking at what you have done you can see what you have not done as well and that may lead you to improve our trading. You might look back and see that you have closed losing positions only after losses have mounted to the point where you feel hopeless. That revelation could lead you to establishing a more disciplined exit strategy. Instead of waiting for hopeless, instead decide to use the reversal of some indicator, or the break through a moving average as a more disciplined way to cut losses more quickly and more efficiently. I tell people this all the time when they call to ask. So, if you are not satisfied with your trading, look and see what actions can be improved going forward. Success is not static and can become better than you ever thought when you are willing to examine how you got where you are, with a look to how you can make the necessary changes to get where you want to be.
Again, there are many ways to make and lose money in the markets. It is clearly worthwhile to learn how to make money and how to reduce or avoid losses if one is going to venture into this game. For if you are not armed with Knowledge, it is better to forget the possibility of financial gain in the markets and simply live life on the sidelines. The risks for the ignorant are huge, and in this action, Ignorance is not bliss.
Safety Safety is an illusion. You have all heard and experienced that, ask yourself, Is it safe to walk down steps, take a walk, cross the street, drive your car, sail your boat, swim in the ocean, fly your plane, ski and scuba dive, etc, etc, etc. So it is fair to say that it is not likely to have complete safety in life. In the investment world, highly rated bonds were considered safe in the past, but that has been proved not necessarily so. In the world of stock trading, safety is established with the exit strategy, and like most safety, it is imperfect at best. But it does work pretty well if you have established a good plan. And as a player/trader, you must begin with a clear understanding what is adequate safety for you. This column talks about the â€œPlanâ€? throughout the year, Plan Your Work and Work Your Plan is a recurring theme here. It is your money, so for sure it is your responsibility.
Knowledge of Yourself -Your Plan is very helpful, and is used by professional traders to help them Win in a game where most lose. Knowledge is Power! Again, the Reminder on Risk Risk is everywhere including trading the markets; you must learn to manage risk. When you seek profits in trading markets there is a certain factor that creeps in; it is the "Greed" factor; then comes the Risk factor that gives rise to the Fear factor in trading. Likely, many bad trades are the results of a misunderstanding of/or an initial failure to pay attention to risk. Once that risk becomes real for many folks, it can turn into fear and panic. Risk means we can lose something we have, and often, traders fail to realize just how much is at risk until it is too late for them One of the most compelling facts regarding risk of loss in the market is that if a position loses 50%, it must then double, i.e. move up 100% to get back to even. It is important to note that risk in the buying of stock in the market is one of the riskiest things on the planet. When buying a stock, the total investment is at risk. And as we have seen recently, formerly great companies can fall to Zero. You ask: Red, Are there ways to reduce the risk of losing my entire investment when buying stocks?
Sure, we have discussed them in previous articles. One is employ stop loss orders in place or trailing stop loss orders. In most situations, these orders can work to prevent losing everything. It is unlikely that a stock will drop from USUS$50 to US$ Zero overnight, and most stocks that fail often post warning signs; and while they often fall fast, they usually take a bit of time to hit Zero bottom. In such circumstances, the stop loss may work to preserve capital. Here is another way to protect an asset (some of us call it Insurance). That is to buy a protective Put. A Put option is a contract whereby the buyer of the Put has the right, but not the obligation, to force someone to buy his stock at a pre-determined price, called the strike price, any time before the option expires. To obtain that right, the buyer of a Put pays a premium. The situation is at least analogous to an insurance policy where the insured (stock owner) pays a premium in order to assure that a loss is limited to the premium, plus any deductible. You can learn about managing risk with options, but the major risk in options strategies is that options expire, so your puts and calls only have value until expiration; and assuming no change in the price of the stock, the call becomes less and less valuable as time passes, until there is no time left. Insuranceâ€Ś Another thought that is often espoused is to diversify. There are differing schools of thought regarding diversification and there are many ways to diversify. The above discussion lists some of the ways traders reduce and manage risk in a stock purchase transaction. All of the above is intended to motivate you to seek a greater understanding of Risk and in doing so help you Win.
Again, think Education First. For news and information please go to www.livetradingnews.com, www.paulebeling.com and www.ebeling-heffernan.com , www.aseanaffairs.com sign up for RSS feeds on the latest US Market News, ASEAN and World News, Twitter, and the Hot List, it’s Free
My pal Wally Stein’s Words of Wisdom Buy Low, Sell High or at least in the Middle; that’s Wally’s Lullaby Sooner or later, those who win are those who believe they can!
Red’s Quote of the Week: Generosity is another quality which, like patience, letting go, non-judging, and trust, provides a solid foundation for mindfulness practice. You might experiment with using the cultivation of generosity as a vehicle for deep self-observation and inquiry as well as an exercise in giving and being thankful. -- Jon Kabat Zinn
In View: Wealthy males supporting e-books market GOOG, AAPL, MS, MMB, NWSA, OMC Investment bankers are boosting the “niche” e-books market by buying books they may never read, according to the co-manager at Lagardère, (PAR:MMB)owner of book publisher Hachette Livre. The comments follow Hachette’s deal with Google (NASDAQ:GOOG) this week to allow the US search company to scan and sell online its Out-of-Print books.
Dominique D’Hinnin, Lagardère’s finance chief, told the Morgan Stanley TMT conference in Barcelona that while most paperback buyers were 50 anni women of “average income”, e-book customers tended to be younger men, a more lucrative market. “We do not talk about the mass market yet. Most e-book buyers are males, 35 anni, with a lot of money. Basically it’s investment bankers,” Mr D’Hinnin said.
That same affluent market of iPad owners is prompting higher advertising rates for magazine applications, he added. E-book prices are about 20% lower than new Hardback sales, he said, generating higher sales volumes but at a higher margin, because there are no printing or distribution costs. “What we see is an investment banker with an e-book device buys more books than he would with paper books,” he said. “It’s an impulse buy that he may never read. It’s the case with paper books anyway - we all buy books we do not have time to read, but it’s a larger trend with e-books, because it’s easier to do and faster. So volumes are up, that’s why it’s an opportunity from a publisher point of view, margins are better and volumes are up.” Warning that while sales are too small, especially in Europe, to make assumptions about mass-market potential, Mr. D’Hinnin denied that there would be downward pressure on prices. “You never buy a book because it’s a cheaper one, you buy it because you want to read it,” he said. ”If you know you have a good book that everyone wants to read, you put it at a certain price and if it doesn’t work you can lower the price later on.” Publishers can set their own prices on Google (NASDAQ:GOOG) and Apple’s (NASDAQ:AAPL) e-book stores, after many baulked at Amazon’s proposed lower prices on its Kindle. E-books are 9% of book industry revenues in the US, Mr. D’Hinnin said, but just 1% in the UK and “Zero” in France. Digital tablets have been among the hottest topics for discussion at the Morgan Stanley (NYSE:MS) event, with many executives - including News Corp’s (NASDAQ:NWSA) James Murdoch, Omnicom’s (NYSAE:OMC) John Wren and WPP’s Sir Martin Sorrell, toting Apple’s iPad.---Paul A. Ebeling, Jnr. www.livetradingnews.com
US Major Markets Support and Resistance Points
Support and Resistance DJIA Closet 11,203.55 Resistance: 11,205 the April 2010 closing high 11,258 from the April 2010 high 11,452 the November 2010 high
Support: 11,100 from the July 2008 low
The 50 day EMA:11,004 10,963 the July 2008 low 10,920 the May 2010 high 10,730 the January 2010 high 10,609 the Mid-September 2008 interim low
The 200 day SMA: 10,599
S&P 500 Close: 1199.73 Resistance: 1220 the April 2010 high 1227 the November 2010 high 1313 the August 2008 interim high
Support: 1185 from September 2008 1174 is the May 2010 high: Key, 78% Fibonacci retracement of April high
The 50 day EMA:1171 1170 the March 2010 high 1156 the Sept 2008 low 1151 the January 2010 high 1133 a September 2008 intra-day low 1131 the August 2010 high
The 200 day SM A: 1130
NAS Close 2518.12 Resistance: 2518 is the interim high from April 2010 2530 is the April 2010 closing high 2535.28 is the April 2010 intraday high 2540 the Gap up point from early November 2550 from May and June 2008 high 2569 the November Gap up point through the April 2010 high 2593 the November 2010 high
Support: 2511 the lower mark of the November 2010 Gap open up 2482 the recent October 2010 high
The 50 day EMA: 2445 2434 the May 2010 interim high: Key, the 78% Fibonacci retracement of the April sell-off. 2425 an interim high from May 2010 2382-2395 a support range from Y 2008 2324-2370 a range of resistance turned support from early Y 2008 2341 the June 2010 high 2320 the January 2010 high
The 200 day SMA: 2326 ____________________________________________________________________________________
Hot Topics See all of the Latest World News on www.livetradingnews.com up-dated hourly 24/7
New Study shows US Congresspersons increased Wealth during Recession For many Americans heading to the polls during the mid-term elections, the perception that Congress was not representing them was clear. Public approval of US Congresspersons hit lows of 17% in November, according to a Gallup Poll, as Americans remain frustrated with an unemployment rate that still hangs near Double Digits, and is unlikely to return to pre-recession levels for many years to come. Many US voters feel that Congress stands aloof from ordinary Americans and is doing little to boost employment. Now, a new study offers an additional reason for Americans to believe in a disconnect between Congress and the Average Joe. Between Y's 2008 and 2009, members of Congress collectively increased their personal wealth by more than 16%, according to a study by the Center for Responsive Politics released last week. Moreover, while some members' financial portfolios lost value during this worst recession since the 1930's, nearly half of them, 261 are millionaires, the Center's study found. That compares to about 1% of Americans who are in the same financial boat, the Center said. "It's a huge disconnect. The people who serve on Capitol Hill do not reflect the type of people who make up mainstream America," said Craig Holman, government affairs lobbyist at Public Citizen, an advocacy group. "That is what really breeds a lot of the cynicism that the American public has toward Congress, the belief that members of Congress 'really do not represent people like me.'" Regardless of which party they belonged to, all members of Congress increased their median wealth in Y 2009 to US$911,510, up from US$785,515 in Y 2008, the study found. The spike mirrors a rebound from the period between Y's 2007 and 2008, when overall congressional wealth slipped by more than 5%, the study found. "If you are without a job, if you are underemployed, you might wonder whether your member of Congress who may have a 1, 10 or a 100M in US$ assets really does understand your struggles," said Dave Levinthal, spokesman for the Center for Responsive Politics. The most popular investments among lawmakers are companies that are the most powerful corporate political forces in Washington, who spend 10's of millions of USD's each year lobbying federal officials, the Center said. Many of them donate Millions of "Greenbacks" to federal candidates each election cycle through their top employees and political action committees, the Center said.
"This information we feel is critical for Americans to pay attention to," Levinthal said. "It behooves them to know whether their member of Congress has a conflict of interest or if they are invested in a company that could benefit or be hurt by a particular piece of legislation they are considering." Still, some observers argue that not all members of Congress are aloof from their constituents, as some lawmakers have fought hard for legislation that they believe would help those at the lower rungs of the economic ladder. And just because a lawmaker is wealthy does not make them immune to their constituents' economic woes, some observers contend. Congress' expansion of wealth reflects a generally expanding gap in the United States between the "haves" and the "have-nots." US census data has shown a jump in the number of households living in poverty, defined as a family of four earning less than US$22,000 a yr, to 14.3 percent in Y 2009, up from 13.2% in Y 2008. On the other side, the number of millionaires in the United States grew this year, according to the Phoenix Affluent Marketing Service. The number of households with liquid assets of US$1M or more grew 8% in the 12 months preceding June, although the figure stands at less than Y 2007 levels of millionaires, Phoenix said.---Paul A. Ebeling, Jnr. www.livetradingnews.com
WB official lists challenges for World economy World Band senior vice president Vinod Thomas Friday called for more co-ordination between governments to ensure Global economic recovery, and warned against QE-2, "Currency Wars" and fiscal deficit expansion. Thomas said deficit and debt-laden countries, especially OECD industrial sates, had little room to expand fiscally. Thomas said QE had limits because it created a lot of money that tried to move to other countries for better interest rates, including Brazil and China. "You cannot use it as a way to increasing growth," he said. Earlier this month, the US Federal Reserve started a controversial plan to buy US$600B+ in Treasury bonds, known as the QE-2 monetary policy, to jumpstart the sluggish US economic growth.
Thomas, also director general of the WB's Independent Evaluation Group, said that if all countries tried to make their exchange rates lower, the effect would be canceled. He said the growth of emerging economies was critical to reestablish global economic prosperity and for that purpose trade openness is important. He said the recovery of growth in the United States, Europe and Japan, depended on not only trade remaining open, but improvements in domestic demand. He also warned about a possible food and agriculture crisis, which would be major concern for emerging and low-income countries amid global climate change. He said the world needed to find a way to generate more productivity, reduce energy waste, improve infrastructure or improve quality education. "Policies to generate productivity and growth would seem to be the best way," he said. Thomas said China's macroeconomic picture had tightened, but it was still robust compared with other countries. He said the fundamental question for China was the quality of growth and it was critical to keep the growth inclusive and to avoid increasing wealth gaps.---Paul A. Ebeling, Jnr. www.livetradingnews.com
South Korea bans unauthorized financial transactions with Iran South Korea will ban all unauthorized financial transactions with Iran starting next year as part of sanctions against the country for its controversial nuclear program, local media reported Thursday. The finance ministry said individual financial transfers involving 40,000 Euros or more must get a prior permission from the Bank of Korea. Financial deals involving more than 40,000 Euros over twelve months should also be authorized beforehand, according to local media. Transactions related to medical equipment, health services, food and items for humanitarian purposes are not required to notify the authorities in advance, but must report it later. The plan is part of Seoul's independent sanctions on Tehran for its nuclear program that Washington believes is a cover for developing nuclear arms. Iran denies the charge and warned of financial damage to South Korean firms tapping into the growing Iranian market.---Paul A. Ebeling, Jnr. www.livetradingnews.com
Irish central bank head expects Ireland to take EU/IMF Loan
Irish Central Bank Governor Patrick Honohan Thursday said he expected the Irish government would have to accept a financial bail-out, as EU and IMF negotiators arrived here for talks. In an interview with Irish state broadcaster RTE, Honohan said he expected the Irish government to accept a loan of tens of billions of Euro. "It's my expectation that that is what is definitely likely to happen. That's why the large technical teams are sitting down discussing these matters," he said. "I think this is the way forward. Market conditions have not allowed us to go ahead without seeking the support of our international collaborators," the bank chief said. Honohan said the loan would be used to show Ireland had "sufficient firepower to deal with any concerns of the markets." He said the loan would be borrowed at a rate in the region of 5%. The Irish government is expected to battle to prevent any increase in the 6B Euro (US$8.15B) adjustment proposed for the Y 2011 budget and the 15B Euro (US$20.38B) target in the 4 yr plan during Thursday's talks.--Paul A. Ebeling, Jnr. www.livetradingnews.com
Germans enter Christmas Season with the biggest spending in 6 Years Germany’s consumers are leading the Christmas cheer. Germans will spend 76.9Beuros (US$105B) in November and December, 2.5% more than last year and the strongest growth since Y 2004, according to the HDE retail association. Deloitte LLP also said retail spending will rise “slightly,” even as most of western Europe contracts. The country’s jobless rate fell to an 18 yr low in October, boosting consumer confidence at the start of a quarter when some retailers generate all their annual profit. After a decade where consumer spending barely grew, sales may gain as companies including Porsche SE (GR:PAH3) reward workers with bonuses. There is a clear improvement compared to last year’s business, customers are not asking so much about prices and just buy what they like, men are spending more on their wives buying up cognac-colored retrostyle hand bags for about 500 Euros each it was reported.. Germans, whose 2,500 outdoor Christmas markets attract tourists from around the World, traditionally spend less than the rest of Europe on Christmas presents and festive meals such as goose with dumplings. Average spending per consumer will be 470 Euros this yr, compared with about 1,200 Euros in Luxemburg, 1,000 Euros in Ireland and 640 Euros in Italy, according to a Deloitte survey.
In western Europe, where Euro-area unemployment is at a 12 yr high, only Switzerland and Luxemburg are likely to show stronger growth in Christmas sales, according to Deloitte. A survey by the accounting firm showed shoppers in 19 western European countries expect to spend 2.5% less.---Paul A. Ebeling, Jnr. www.livetradingnews.com
Allied's depositors withdraw €13B AIB, BRI Allied Irish Banks' (ISE:AIB) funding position is continuing to weaken with the lender reporting a €13B (US$18B) outflow of institutional and corporate deposits since the start of the year. In a trading statement on Friday, Allied, which is 18% owned by the government, said it had “been affected by the current adverse international sentiment towards the Irish sovereign and banking sector”.
Allied’s announcement comes after Bank of Ireland (ISE:BRI) and Irish Life & Permanent both disclosed big outflows of deposits last week. Allied said it had increased the amount it needed to raise from a planned share sale from €5.4 to €6.6B. The offer is fully underwritten by the Irish sovereign wealth fund, the National Pension Reserve Fund. Given the current market capitalization of about €500M, the transaction will leave the government as 90% owner. The sale will provide the bulk of the €10.3B capital target the Irish regulator has said Allied must achieve by next March 31, which was increased from the €7.3B level set in March. The balance of the capital requirement is being met by the disposal of its Polish and US banking operations. Last week Bank of Ireland said it had lost €10B of corporate deposits, or about 12% of its deposit base, in a matter of weeks following September’s sovereign credit rating downgrades. On Wednesday Irish Life & Permanent disclosed it had seen an 11% reduction in customer deposits in August and September. As funding pressures increase, Irish banks have become reliant on support from the European Central Bank, accounting for €130B, or 25B of the liquidity provided to the euro banking system at the end of October. But in recent months, the banks have also been tapping the Irish central bank’s exceptional liquidity assistance program, with about €20B provided in the two months to October 29. AIB said it had been able to access a “range of liquidity from central banks, including certain additional market-wide schemes”.---Paul A. Ebeling, Jnr. www.livetradingnews.com
ASEAN-OECD enhance investment Co-op The Association of Southeast Asia Nations (ASEAN) and the Organization for Economic Cooperation and Development (OECD) have been enhancing investment co-operation in which ASEAN keeps promoting and facilitating investment inflows. Efforts to increase and sustain the inflows of foreign investments and adjustments to the investment policies in ASEAN, among others, have been initiated to keep ASEAN as an attractive region for investments in-line with a goal of making ASEAN a region that allows for the free flow of investments under the ASEAN Economic Community. To further promote and facilitate investment inflows and to create a favorable environment for investors in the region, ASEAN has been engaging with its dialogue partners through the signing of free trade area agreements, said Sundram Pushpanathan, deputy secretary-general of ASEAN for ASEAN Economic Community, at the ASEAN-OECD Investment Policy Conference on November 18-19. The UNCTAD 2010 World Investment Report shows that the developing countries attracted half of the global foreign direct investment in 2009 and remain a favorable destination for FDI inflows in the years to come, given the growth expectations for ASEAN. ASEAN's share of total Global foreign direct investment inflows increased to 3.6% in Y 2009, from 2.8% in Y 2008, despite the economic downturn. This optimistic outlook for ASEAN is also shared by the UNCTAD' s 2010 World Investment Report which estimates that there will be an increase of global foreign direct investment (FDI) flows at US$1.2T in Y 2010 and at 1.3-1.5T USD's in Y 2011.---Paul A. Ebeling, Jnr. www.livetradingnews.com
China's largest Crude Oil refiner suspends diesel exports China Petroleum and Chemical Corporation (Sinopec), China's largest Crude Oil refiner, said Friday it has suspended diesel exports to relieve shortages in the domestic market. Sinopec also said it is seeking to import 200,000 tonnes of diesel. PetroChina Co., China's largest oil producer, plans to import 200,000 tonnes of diesel. Some 35,000 tonnes of it has already arrived. Insiders said China's diesel output in the first nine months soared, prompting the two oil giants to expand exports. Sinopec attributed recent hikes in the domestic price of diesel to hoarding, seasonal factors, transport factors and energy-saving measures. "The fundamental reason for the diesel shortage is the industry monopoly. Oil refiners are not keen to increase production because profit margins in the sector are relatively low," said Qi Fang, director of the Hebei Provincial Petroleum Industry Chamber of Commerce.
"The two oil giants operate on a planned-economy basis, resulting in an unbalanced supply-and-demand situation. Supply and demand can easily outstrip each other as government planning cannot keep pace with changes in the market," Qi said. Statistics from the General Administration of Customs show China exported 360,000 tonnes of diesel in October - only slightly lower than the 368,100 tonnes it exported in September, even as diesel shortages worsened. Diesel imports in October rose to 400,000 tonnes, up from 250,000 tonnes in September.---Paul A. Ebeling, Jnr. www.livetradingnews.com
US Fed Chairman calls for more fiscal stimulus to lift US economy US Federal Reserve Chairman Ben Bernanke Friday defended the Fed's recent action to buy more US Government Bonds plan and called on Congress to approve more fiscal stimulus to strengthen the economy. Without more stimulus, high unemployment could persist for years, he said. The Fed on November 3 announced a US$600B + plan to purchase government bonds, the 2nd round of quantitative easing (QE-2), which aroused criticism both internationally and domestically. Bernanke argued that the Fed itself cannot fix all of the economy's problems, aiming to lower public expectations. "There are limits to what can be achieved by the central bank alone," he said. "A fiscal program that combines near-term measures to enhance growth with strong confidence-inducing steps to reduce longerterm structural (budget) deficits would be an important complement to the policies of the Federal Reserve." Bernanke said that the Fed's Treasury bond purchases are needed to promote faster job creation and reduce the risk that very low inflation could turn into deflation. Deflation is a prolonged and destabilizing drop in prices of goods and services, wages and the values of assets like stocks or homes. According to the latest data released by the US Labor Department, the US core consumer prices which exclude volatile energy and food prices in October increased only 0.6% on a Y-Y basis. The unemployment rate, currently at 9.6%, was not expected to fall significantly soon.---Paul A. Ebeling, Jnr. www.livetradingnews.com
HK expects special stamp duty to curb some property speculations The newly issued special stamp duty will help curb short-term property speculation since it will increase speculators' transaction costs, Secretary for Transport and Housing of the Hong Kong government Eva Cheng said Saturday. To clamp down on property speculation which helped heat up the property market, the government of Hong Kong Special Administrative Region issued a new round of measures on Friday, including launching a special stamp duty on residential properties on top of the current property transaction stamp duty. The newly announced anti-property speculation measures were appropriate and timely, said Cheng while attending a radio talk show. According to new regulations, residential properties bought from November 20 and resold within 24 months will be subject to the proposed special stamp duty paid by the buyer and seller, which will be up to 15% if the transaction takes place within six months. "Buyers and sellers should discuss the arrangements of paying the special stamp duty among themselves," Cheng said, adding that the lawyers and estate agents involved in the transaction should remind their clients of the new changes and requirements. Cheng said she hoped that the new initiatives will ensure the property market's stable and healthy development, benefiting real home buyers. Meanwhile, she reminded potential home buyers to assess their affordability carefully before making decisions. As part of the plan, the Hong Kong Monetary Authority (HKMA) also announced on Friday that maximum loan-to-value (LTV) ratio for residential properties with a worth of more than 8 million HK dollars (US$1.03M) will be lowered, in a bid to strengthen risk management in residential mortgage lending business. In the 3 Q's of this year, Hong Kong's house prices have moved up about 15%, with luxury flat prices surpassing their peak level in Y 1997 by 10% and prices of small-sized units increasing by 8.1% in the past 6 months. (One USD = 7.75 HK dollars)---Paul A. Ebeling, Jnr. www.livetradingnews.com ______________________________________________________________________________
At the Movies with Monica Petrucci in Tinsel Town
"Harry Potter and the Deathly Hallows: Part 1," the 7th installment on Hogwarts, is assured of having the biggest opening weekend for the franchise, garnering a World beating US$1.25M in movie ticket sales on the weekend. "Death Hallows" has surpassed 2005's "Goblet of Fire" Friday showing of 102.7 million dollars, the franchise's previous high, and is likely to also surpass "Goblet's" opening weekend take of 102.3 million dollars. Among the 1.25M $ haul, 24M $’s came from midnight showings after the clocks struck Midnight Thursday. The film, which is based on the 1st part of J.K. Rowling's 7th and final "Harry Potter" novel, ranked # 5 on Friday-only debut movie gross record in Hollywood history. The other 4 Top earners are: "The Twilight Saga: New Moon" (72.7M $’s), "The Twilight Saga: Eclipse" (68.5M $’s), "The Dark Knight" (67.2M $’s ) and "Transformers: Revenge of the Fallen" (62M $’s). The finale, "Deathly Hallows: Part 2," is due out in July. "With a one day gross that many films would be hard-pressed to earn in a single weekend, 'Harry Potter' continues to weave his spell over an adoring fan base," industry analyst Paul Dergarabedian said Sunday. ________________________________________________________________________
Current US Stock Market Sentiment + Bulls vs. Bears Watching the VIX: The VIX fell at the end of the week. So far IMO there has not been a correlation with the market, but it may be developing now. We may see some more backing and filling this week based upon the VIX, but it is not a strong correlation now. Market Sentiment 1. VIX: 18.04; -0.71 2. VXN: 19.78; -0.48 3. VXO: 17.44; -1.05 4. Put/Call Ratio (CBOE): 0.66; -0.17
Bulls vs Bears
The Bulls are at 56.2 vs 48.4% the prior week. This is the strongest move North since last May topping that level and getting closer to the 5 yr high at 62.0, and toward the level considered Bearish. Here is where you start to keep a close eye on the action and watch for reversals, but remember that there is a lot of liquidity that will come into the market and that can extend the rally despite any excess Bullishness.
For your Reference: the Bulls hit a high of 47.7% in June on the move off of the March lows. To be seriously Bearish the Bulls reading must get to the 60% - 65% mark. The Bears are at 20.2% vs 23.1% on the slide after holding the 24.4% mark for 2 weeks, and down from 28.3% in September. The 37.7% peak at the height of the "Crossover" is past, but the Bears are well below the 35% level, above which is considered Bullish for the market overall. They tapped at 18.7% on the low in April, and hit a high of 27.8% on the February leg. For your reference: the 35% mark is considered Bearish for the market overall. Hit 18.7% on the low in April, they hit a high of 27.8% level on the February leg. Stay tuned... All the best, Paul A. Ebeling, Jnr.
NB: Watching the VIX. It always tells us when we are moving back to a more rational market. *The Market Volatility Index (VIX) measures the volatility of the market. A recent news story described it as "the options market's gauge of investor fear." Traders use VIX as a general inverse indicator of market volatility and sentiment. High numbers mean that there's excess bearishness, and low numbers indicate excess bullishness. The VIX is updated intra-day by the Chicago Board Options Exchange (CBOE), using Standard & Poorâ€™s 500 Index (SPX) bid/ask quotes. It was created in 1993. **The CBOE NAS Volatility Index (VXN) employs the same formula used to calculate US$VIX, which is based on the implied volatility of S&P 500 index options. This formula is derived from a basket of put and call options. Some are out of the money, some in the money, and some at the money. The resulting US$VXN represents the implied volatility of a hypothetical 30-day option that is at the money. ***The VXO is the ticker created to track the "original VIX" that was calculated using the prices of S&P 100 options. The new VIX uses the ticker US$VIX and is calculated using the prices of S&P 500 options. The fundamental nature of the VXO is the same as the VIX, but it is less robust and not as simple as the VIX.
What to expect this week and down the lineâ€Ś. It is Happy Thanksgiving Week in the USA. The market will not be open Thursday, and Friday's session is half day. Thanksgiving Week in the market can be problematical. The is bias is to the Northside. But, perhaps it will be a direction less week as anybody who is anybody is left Wall Street on Friday for the Holiday Week and the markets could just trade laterally into Wednesday afternoon. If we do see a directionless week it will be a tightening of the trading range and setting up for a Bull run into the end of the year, as there are a lot of hedge funds and mutual funds managers that will want to chase that performance of this good market year into to year's end, so they can report to their investors that not on the sidelines waiting for confirmations but make money. I expect that a lot of the liquidity from the US financial system will come into the markets and stocks to move higher. Look for some good entry points this week on the good stocks if the rally does not extend this week. Again, the days before Thanksgiving can be up or down. And if it is down it just means that there will be more opportunity to enter the emerging leaders as they are bought higher into year's end. There is a lot cash on the sideline earning Zero, and Zero is not a good result for cash in a Bull market IMO. US Fed Chairman Bernanke said Friday, that there is need for more and different fiscal programs to help the monetary side of the equation. Raising taxes and spending is not the answer. The country need more saving, fewer taxes, more savings means higher interest rates. Move away from big government and its strangling regulations, reward the country's innovators and entrepreneurs that create new businesses and new ways of doing things. Promote growth and investment in the country. That would all be good IMO. Inflation is out there, not right in front of the World economies yet, but it is there for sure. The prices of commodities is one of my gauges. Now after the pull back that I talked about in this column last week and the fact that there is a whole lot of cheap money at the Fed Window means the market's rally likely extends, check your positions and the ones that should run, let run, as there is money on the Street and I do not believe the retail buyers are actually back in the markets in large numbers. That sideline money is just waiting to enter and when it does it will help boost this market higher. Also, look to take advantage of opportunities when they come, and as always take what the market gives. To all my readers in the USA, have a Happy and Safe Thanksgiving Holiday. All the best, Paul A. Ebeling, Jnr.
___________________________________________________________________________ Red's Weekend Report on Gold, Silver + Base Metals, and Crude Oil Fundamental Overview Commodity prices were pressured last week. All commodity indices declined during the week with CRB index, GSCI Commodity index and the DJ/UBS Commodity falling -5.75%, -6.31% and -5.61% respectively Gold's price movement is influenced by other commodities. GSCI's agricultural and precious metal indices have been moving roughly in the same direction. Crude Oil prices rose for a 2nd day running with the front-month WTI Crude Oil contract rising to as high as 82.75. The contract slumped to a 1-month low of 80.06 on Wednesday. Precious metals also gained with Gold rising to 1362.9 before easing to 1358. Despite characteristics as a financial asset, the precious Yellow metal has displayed properties as a commodity these few days. Silver rebounded more strongly than Gold, as its correction over the past few days was also more severe. In GFMS's Silver review, the agency forecasts the metal will continue to rise next year, with price averaging at 30$ oz. The market was influenced by macro-economic developments including a potential rescue for Ireland, acceleration in tightening measures in China and effectiveness of Fed's QE-2. The market sentiment was lifted as Irish Finance Minister Brian Lenihan and central bank governor Patrick Honohan signaled the country may apply for a rescue from EU/IMF and. ECB Vice President believed the rescue package would 'stabilize the situation'. Underlying investors' confidence remained fragile. On Friday, the People's Bank of China raised the required reserve ratio by +25 bps, the 2nd time in 2 weeks, to curb excessive lending and inflation. The move indicates the government is highly concerned about inflationary and asset-bubble risks. It's increasingly likely that a rate hike may be announced in coming weeks. Acceleration in Chinese tightening poses a threat to commodities as China is one of the biggest consumers of energy and base metals. During the week, the worst performing sector is base metal with Lead and Zinc falling almost -10%. After surging to a record high of 8966 on November 11, Copper caved and broke below 8000 last Wednesday, before recovering to 8404 at close Friday. This week, developments in peripheral European economies will remain in the spotlight. In the US, the FOMC minutes will unveil the Fed's view on monetary policies after the US$600B + assetbuying program. Revised data on US and UK GDP will also be monitored by players.
The Precious Metals Complex The precious metals decline was driven by broad-based sell-off in the commodity sector, but strong bounds later in the week indicated underlying strength in the complex. The long-term weakness in the USD and the low-rate environment in advanced economies will continue to support the Sector up-trend IMO. Gold and Platinum ended the week with modest losses of -0.97% and -0.77% respectively, while both Silver and Palladium gained more than +4% each. According to Johnson Matthey (PK:JMPLF), Platinum demand will grow +6.12% Y-Y in Y 2010 after declining over the last 2 yr, while supply will dipped -0.25%Y-Y. Surplus will be reduced to 290K oz in Y 2010 from 635K oz in Y 2009. The company expects the Platinum market could remain in moderate surplus in Y 2011. Auto-catalyst demand would rise further in Y 2011 as driven by demand for diesel cars in Europe. Tightening in emissions standards might also boost demand in North America. For Palladium, demand is expected to jump +12.26% Y-Y in Y 2010, following contraction of around -8% over the past 2 yrs. Although supply will increase for the 1st time in 3 yrs, surplus will only be around 45K oz, the small level since Y 2000. Potential supply shortage supply in Russia may result to significant Palladium deficit in Y 2011. Despite a lower rate, growth in the automotive sector will continue in Y 2011. PGM price movements have recently been directed by macro-economic developments with demand/supply balances taking a backseat. As to the PGM market, ETFs have been a significant source of new demand. This is highlighted by a 400K oz increase of assets under management at platinum ETF year-to-date, equivalent to 7% of total demand. For Palladium, total holdings in ETF surged 700K since the beginning of the yr, representing almost 10% of total demand. Stay Tuned... Base Metals The overall risk averse environment triggered a slump in the base metals complex. Despite a rebound on Thursday, PBOC's announcement to increase RRR weighed on prices again. LME Copper for 3-month delivery fell as much as -8% in the mid-week before buying interests emerged below 8000. It remains uncertain when the Collahuasi strike will end. The labor union said that only few workers had accepted the bonus payment offered by the company. Mine production has so far not affected as the company hired non-union employees and contract workers to the mine. Stay tuned...
The Overall Technical Outlook for Comex Gold (GC) Gold fell to as low as 1329 last week but recovered after drawing support from 55 days EMA, above 1315.8 support, which is close to 38.2% retracement of 1155.6 to 1424.3 at 1321.7. Initial bias is cautiously on the Northside this coming week for a retest on 1424.2, the record high. But, a clear break there is needed to confirm up-trend resumption. Baring that, I expect another fall to continue the consolidations. I am staying Bullish as long as 1315.8, the Key support holds.
The Big Picture: the rise from 1155.6 is treated as the 5th wave of the 5 wave sequence from 1044.5, which should also be 5th wave of the rally from 681, the Y 2008 low. This rally is still expected to continue towards 161.8% projection of 931.3 to 1227.5 from 1044.5 at 1449.6 before finishing. And yes, I am aware of the long term projection target of 100% projection of 253 to 1033.9 from 681 at 1462 and anticipate Strong resistance from there to bring medium term correction. On the Downside: A clear break of 1315.8, the Key support mark, will be a signal of a medium term reversal and will turn my light back to 1155.6, Key support for confirmation. The Long Term Picture: the rise from 681 is treated as resumption of the long term up trend from Y 1999 low of 253. The anticipated correction did not happen and gold will now likely climb further to 100% projection of 253 to 1033.9 from 681 at 1462 before making a Top IMO. Stay tuned....
The Overall Technical Outlook for Comex Silver (SI) Silver's pull back from 29.34 was contained at 24.98, by near term rising trend line as well as 38.2% retracement of 17.735 to 29.34 at 24.907 and rebounded strongly. The initial bias remains on the Northside this coming week and a further rise should be seen to retest 29.34 high first.
On the Downside: a clear break of 24.907 will augur that the rise form 17.735 is done, and will bring deeper fall to 55 days EMA now at 23.66 IMO.
The Big Picture: Silver's up-trend is intact. This rally from 8.4 is treated as resumption of the rise from Y 2001 low of 4.01. On the resumption, Silver's target is the next fibo projection level of 261.8% projection of 14.65 to 19.845 from 17.735 at 31.34.
On the Downside: break of 20, the Key psych level, is needed to signal medium term reversal. Baring that I remain Bullish on Silver mates, Stay tuned...
The Overall Technical Outlook for Nymex Crude Oil (CL) Crude Oil dropped to 80.06 last week before forming a temporary low there and turned sideway. The Initial bias remains Neutral this week and some consolidations will likely be seen first. However, note that another fall remains in favor as long as 84.52, the minor resistance holds. A break below 80.06 will target the 61.8% retracement of 70.76 to 88.63 at 77.59 and below. But, a break above 84.52 will turn the intra-day bias back to the Northside for a retest 88.63 high.
The Big Picture: the steeper than expected fall from 88.63 is mixing up the outlook and augurs that rise from 64.23 is possibly done in 3 waves up to 88.63. In other words, it could be the 2nd wave of consolidation from 87.17 and the 3rd wave might have just started. So, now I will slightly favor more decline as long as 88.63, the Key resistance holds. But, the medium term rise from 33.2 is treated as the 2nd wave of the consolidation pattern that started at 147.27. As long as 64.23 support holds, medium term rise from 33.2 is still going forward to extend to 50% retracement of 147.27 to 33.2 at 90.24 and possibly higher before it finishes.
The Long Term Picture: the rebound from 33.2 is not finished. However, my overall POV remains unchanged. Crude Oil is in a long term consolidation pattern from 147.27, with 1st wave completed at 33.2, 2nd wave from there ongoing. The current action suggests that a breach of 61.8% retracement at 103.70 is likely. But, there I will start to focus on a Key reversal signal again at some mark above 103.70. Stay tuned...
Red's Forex Chart of the Week: Red's Forex Chart of the Week: the EUR-USD Pair
FX Daily Levels and Pair Outlook: EUR/USD Resistance 1: 1.3750; Resistance 2: 1.3820.Support 1: 1.3670; Support 2: 1.3570; Support 3. 1.3525 The market is slowing down the current rally, but it did break above 1.3670, a very important pivot point. I am now looking at it as support for the current move back. But, this current Bullish correction from the recent down trend might not be over yet. Consider the Bearish continuation scenario only after a break below 1.3570. And look for support around 1.3670/1.3650 for continuing Bullish correction into the beginning of the this coming week. There I am looking to see if the market can rally towards the 1.3750/60 first, then 1.3820. There should be a lot of media "Noise" as the market twists and turns in a correction, so expect some erratic and choppy behavior in here. Stay tuned... Paul A. Ebeling, Jnr. www.livetradingnews.com
Disclaimer: This report is prepared solely for information and data purposes. Opinions, estimates and projections contained herein are the author's own as of the date hereof and are subject to change without notice. The information and opinions contained herein have been compiled or arrived at from sources believed to be reliable but no representation or warranty, express or implied, is made as to their accuracy or completeness and neither the information nor the forecast shall be taken as a representation for which the author incur any responsibility. The does not accept any liability whatsoever for any loss arising from any use of this report or its contents. This report is not construed as an offer to sell or solicitation of any offer to buy any of the currencies referred to in this report.
Soon to be seen on www.bull-penny-stocks.com
Small Cap Stocks to Watch Arjuna Media Inc. (PK:AEMC) aka Archer Entertainment, Inc.
Arjuna makes investments in independent motion pictures, television product and sporting events to movie theatres, all forms of television outlets and digital platforms. The Movie Industry is one of most exciting and informative businesses in the world, where the revenue of a single feature film, such as “Avatar,” or “The DaVinci Code”, “Titanic,” or the trilogy of “Lord of the Rings” can exceed one billion dollars. The entertainment industry has always been consistently attractive as an investment vehicle for practical and emotional reasons. Through wars, depressions, and good times, entertainment has always paid dividends. Investors from all over the globe, from Sony & Matushita to Coca Cola, to Rupert Murdoch and Vivendi, traditionally stand in line to pay increasingly record sums to acquire entertainment assets, especially films. Arjuna does not and will not produce its content; the company is focused on risk- averse product development. The Company’s executives are senior in their field, and have seasoned and respected talent and key business relationships, plus exceptionally successful management skills that solidly position them to build a leading film company delivering strong financial returns for investors. Arjuna will seek an initial release slate of four pictures and to acquire a portfolio of twelve motion pictures in its 1st year. It will market these products in the most creative, effective, cost-efficient manner, and focus on making certain that each picture receives the appropriate attention required for success. Arjuna, its related entities and strategic partners, will seek out films for which it can build strong economic models, and which posses extraordinary potential for success in both theatrical and ancillary markets. www.arjunamediainc.com Trading at US$0.11/shr. +.01 Support .09 Resistance .12. The 50 Day EMA is .16 Technicals are overall Neutral. The recent Candle Stick analysis is Very Bearish
Latest News and Opinion: Archer Media Entertainment Accepts Arjuna Media Bid to Take Over Company http://finance.yahoo.com/news/Archer-Media-Entertainment-bw-2195496402.html?x=0&.v=1
Hythiam, Inc. (HYTM) This Company is doing good work and closing in on the answer to addiction of drugs and alcohol through its patented Prometa® therapy, a protocol that is designed to reset dysfunctional receptors in the brain to a pre-substance abuse state while integrating medical, behavioral, and nutritional components. Hythiam has 21 patents issued or allowed and 95 applications pending. Q-1 Y 2008 revenues grew to USUS$11.3 million, with 60% increase in contributions from anti-addiction services. Hythiam recently signed an Agreement with Ford Motor Corp. to offer its services to Ford’s employees worldwide. Hythiam provides comprehensive behavioral health management services to health plans, employers, and criminal justice and government agencies. In May 2008, Hythiam announced reimbursement agreement with CIGNA HealthCare for Prometa based treatment program. Its CATASYS™ Integrated Substance Dependence Solution is the only program of its kind dedicated exclusively to chemical dependence. The company also researches, develops, licenses and commercializes innovative and proprietary physiological, nutritional, and behavioral treatment programs. This market represents 180 million lives, and over 22 million Americans suffer from dependence on illicit drugs or alcohol, with only 18% seeking treatment. Direct medical costs in the US are over USUS$42B. Cocaine/stimulant addiction therapy is a multi-billion dollar market opportunity that was previously without effective treatment. www.hythiam.com Currently trading at .034 -.006 Support NIL. Resistance .04. The 50-Day EMA is .06. There is a Bearish Engulfing Candle on November 12. The overall technical indicators are Bearish. The recent Candle Stick analysis is: Very Bearish Latest News and Opinion: Experienced Financial Executive, Peter Donato, Joins Hythiam as CFO http://finance.yahoo.com/news/Experienced-Financial-bw-100548859.html?x=0&.v=1 Hythiam Raises Approximately US$3.5 Million in Registered Direct Offering http://finance.yahoo.com/news/Hythiam-Raises-Approximately-bw-2691700782.html?x=0&.v=1 Neah Power Systems, Inc. (NPWZ) NEAH announced this week that Popular Science Magazine has named their unique silicon-based fuel cells the “Innovative Product of 2010,” which is a signal honor. Neah has developed and successfully tested a patented, silicon-based, micro fuel cell, which recently passed 2000 hours of continuous energy production. The Company claims it will eventually replace batteries. It recently successfully completed a second round of tests for U.S. Navy Office of Naval Research, which has invested US$3 million into the Company, which expects to offer its products to the entire range of the US and global military. The self-contained fuel cell also has a large market in police, and fire departments, and other first responders, including ambulance, paramedic and emergency room personnel, as well as power solutions for notebook PCs PDAs, mobile phones, camcorders, digital cameras and other portable electronic devices. NEAH’s fuel cell fits within a notebook PC’s internal battery cavity instead of outside the computer, and uses methanol, a renewable resource, which delivers continuous untethered power. NEAH recently received a cash infusion from Agile Opportunity Fund, and also acquired SolCool One, LLC, and a leader in the solar air conditioning industry. NEAH recently announced a joint venture with Hobie Cat boats to develop a fuel cell propelled craft, and also revealed another with EKO Vehicles of Bangalore, India, to develop a fuel cell charger for their line of motorcycles and scooters sold around the world. http//www.neahpower.com The iHubbers are also talking about Neah.
Currently trading at .0265 -.0024 Support NIL Resistance .03 The 50 Day EMA is .05. Technicals overall are Bearish. There is a Bearish Engulfing Candle on November 12. The recent Candle Stick analysis is: Very Bearish Latest News and Opinion: NEAH and India's EKO Vehicles to Explore Merger and Acquisition Opportunities to Facilitate Global Growth
http://finance.yahoo.com/news/NEAH-and-Indias-EKO-Vehicles-iw-3572924924.html?x=0&.v=1 Skymark Research Initiates Independent Research Coverage on Neah Power Systems, Inc. http://finance.yahoo.com/news/Skymark-Research-Initiates-pz-3010079409.html?x=0&.v=1
TOMI Environmental Solutions, Inc. (TOMZ). “TOMI” is an infectious disease control company, which uses one of the most powerful disinfectants known to man ozone. The Ministry of Health, in Thailand, has invited TOMI to demonstrate its prowess in eliminating pathogens in a military hospital, similar to its success in September, in a Baltimore hospital operating room, in which it killed 99.999% of all viruses, bacteria, mold spores, and pathogens. TOMI’s technology can be used against all forms of pathogens, including Swine Flu. Hospitals can be a significant hazard to sick people, and TOMI may come to be the only answer to a real problem in healthcare. TOMI remediated a high school in Brooklyn, NY after a flu outbreak, and outperformed any other known treatment method, killing 99.999 percent of all bacteria, viruses, and mold spores, using TOMI’s Ultraviolet Ozone Generators. The EPA reports that indoor air pollution is in the top five risks to public health. The American Medical Association (AMA) says that indoor levels of pollutants are between 25 and 200 times higher than outdoors. TOMI-ES has an exclusive distribution agreement with Advanced Disinfection Technologies, LLC to market their MRA Technology to over 300 Hospitals with its alliance partners. Magnetic Resolution Activation (MRA™) is a revolutionary breakthrough disinfection process that effectively kill microorganisms, is not harmful to people or animals, is non-allergic, inexpensive and convenient to use. 2.4 million people each year require additional hospital care. Hospital-acquired infections (HAIs) account for more than 120,000 deaths annually in the US. ADTec's research and development company and TOMI’s complete air remediation for all forms of disinfection for many industries, solves this problem with the ability to kill 99.99% of harmful bacteria, viruses and spores in a hospital room in 15 minutes at a very economic price. Unlike harmful chemicals, the Reactive Oxygen Species fog (ROS) does no damage to any known material. www.tomiesinc.com Currently trading at .052 -.003 Support .Nil Resistance .07. The 50-Day EMA is .08. There is a Bearish Harami on November 12 and a Gap open down on November 5 at .0635 to .06. The overall Key technical indicators are Bearish. The recent Candle Stick analysis is: Very Bearish
Latest News and Opinion: TOMI Environmental Solutions, Inc. Announces Its First Sale in the United Arab Emirates http://finance.yahoo.com/news/TOMI-Environmental-Solutions-bw-1076426781.html?x=0&.v=1 TOMI Environmental Solutions and L-3 Communications Enter Into Relationship to Commercialize Binary Ionization Technology (BIT) for Bio-Sterilization http://finance.yahoo.com/news/TOMI-Environmental-Solutions-bw-389992555.html?x=0&.v=1 ____________________________________________________________________________________
“On the Watch List” contains potential investment opportunities suitable small, mini and micro cap portfolios. On The Watch List Bolser PLC and Mingo Bay Properties PLC make up the LTN German Hot List, both have very strong asset backing, are profitable and growing revenue. If it is the right time to begin building your European portfolio, check out these 2 stocks. Bolser PLC Frankfurt Stock Exchange (UKG.F) Bolser PLC located in London, UK owns 99% of the subsidiary group of companies Bolser Ltd., located in Bolivia, Peru and Brazil. Bolser Ltd., (Bolivian Oil Services Ltda.) was founded in 1975 by the Hinojosa family. Bolser Plc., through its operating subsidiaries and its more than 305 employees has been a long time leader in the oil, gas and mining infrastructure construction industry. Bolser is a specialist in the construction and maintenance of pipelines, roads, bridges, manufacturing and storage sites of various types. The company pursues an international growth strategy, aiming to continue developing new markets in neighboring countries such as Brazil and Peru. The company’s competence is based on the long experience of its employees and management, using this to target the needs of the various projects, depending on the situation and the existing infrastructure to develop an individual solution for the customer. Based on its good South American market position and a scalable business model, Bolser PLC expanded their presence in attractive foreign markets. Because of its growth in the energy, mining and infrastructure operations Bolser decided to expand to Brazil and Peru and founded there more subsidiaries. Because of the knowledge of the geological, political and infrastructural situation in these countries to assess and evaluate quickly this knowledge for new projects, Bolser is in an excellent starting position for their business activities and creates additional growth potential. http://www.bolserplc.com Mingo Bay Properties PLC Frankfurt Stock Exchange (5RB.F) Mingo Bay Properties PLC is a United Kingdom domiciled public company with its shares currently listed on the Frankfurt Stock Exchange (FSE). The “Company” refers collectively to Mingo Bay, its subsidiaries, joint ventures, affiliates and partners. Mingo Bay is in the business of acquiring, developing, and managing recreational and residential resort properties. Mingo Bay markets the properties through its company, 1 Beach Development, Inc. as vacation ownership interests. Mingo Bay has U.S offices in Houston, Texas and Tampa Bay, Florida and its registered office in London, England. The Company has development projects in the Dominican Republic and Mexico. The Company currently owns, manages and markets ocean front resorts in Puerto Vallarta and Cabo San Lucas, Mexico. The Company currently has €36,024,000 (€1.28) per share capital and projects positive EPS growth for 2010. www.mingobayplc.com www.onebeachstreetvallarta.com www.playadelsolpv.com
Ronn Motor Company (RNNM.PK) Ronn Motor Company (PK: RNNM) (www.ronnmotors.com) announced that the renovation on their new Green manufacturing facility and corporate headquarters is nearing completion. In keeping with their “green” theme, Ronn Motors was able to locate, hire and utilize independent, green, certified, local contractors that have made extensive use of green materials in the construction process wherever possible. It is expected that the manufacturing facility will be available for limited access within the next couple of weeks. This will provide the company an opportunity to move in and start setting up production in the mid May time frame. Full access to the facility is projected for the end of May. Ronn Maxwell, CEO of Ronn Motors, commented, “We’re thrilled. After a few construction delays, we can finally see the end, or should I say the beginning of a new phase. Our planning is completed. We are geared up and ready to quickly move towards full production of the Scorpion HX and H2GO real-time hydrogen injection system and, more importantly, start delivering on our commitments in the 3rd Quarter of this year.” While waiting for the completion of the renovation of the new Marble Falls manufacturing facility, Ronn Motors has been working on the initial plans and design of a new midrange sports hybrid sedan, based on electric/diesel hybrid technologies. The board has now given the go-ahead to move forward and put those plans on the drawing board. During the last two years Ronn Motors has met with many electric, diesel and hybrid drive train manufacturers, as well as other automotive designers. The new Marble Falls facility will provide adequate additional space to develop this car in the future. Ronn Maxwell, CEO of Ronn Motor Company, stated that, “Consolidating our manpower and leveraging the skills and lessons learned from the creation of Scorpion HX should help to provide us a competitive edge in this new developing market. We are genuinely excited about the future new addition to our fine family of eco-friendly products.” It is interesting to note that the Japanese automaker and Tesla Motors will be teaming up to develop electric motor vehicles in California. Toyota will not only be investing US$50M of capital into Tesla but will also provide engineering and production systems for the development of electric vehicles. Production of Tesla model S sedan According to the deal, both the automakers will be working together to manufacture Tesla model S sedan, which is a high performance electric sedan, competing with cars like the BMW 5-series. The cars will be manufactured in a plant in California in 2012. Initially, the automakers are expected to produce 20,000 vehicles. The unit will employ 1,000 workers, which are expected to grow to 10,000 over the years.
Read the whole Story at: http://www.livetradingnews.com/electric-car-news-tesla-toyota-and-ronnmotors-13805.htm
HEALTHY COFFEE INTERNATIONAL, INC. (PK:HCEI) HEALTHY COFFEE USA (www.hcei.biz) is focused on bringing health to the world’s most popular and widely distributed drink, coffee. The company’s proprietary formulas combine the health benefits of Ginseng, Reishi Mushroom, and other top quality ingredients with the world’s finest coffee beans to create a line of deliciously healthy instant gourmet coffee drinks. Healthy Coffee’s products are sold exclusively through its subsidiary, Healthy Coffee USA, Inc., which uses a simple and unique Internet-driven international business model that allows the average person to own and operate a local, national, or international coffee distribution or coffee house business with very little capital investment or overhead. Healthy Coffee is well positioned in the market place at the intersection of three mega-billion dollar industries: coffee, wellness and energy drinks, and has quickly moved into international markets by establishing preliminary marketing offices in more than a dozen countries. Network marketing is the fastest distribution model to bring a product to market, and Healthy Coffee USA’s initial goal is to open 20 countries with a minimum of 50,000 independent distributors in each country within five years, for a total of one million independent distributors. The company’s vision is to bring health to the world’s largest and most popular drink, coffee and to be recognized globally as The World’s Healthy Coffee Company®! In pursuit of our vision, we will: Provide the highest quality Healthy Coffee drinks and wellness products. Provide an opportunity for the average person to own a coffee distribution or coffee house business without the big capital and overhead, and market globally via the Internet. Provide our independent distributors with a sense of “belonging” by being able to own stock in our public company and know they will be part of the company’s projected growth. Build a legacy company that holds integrity as its foundation, because we believe that “integrity is honoring your word”, and make a difference in the industry by offering a real home to its distributors. Build our shareholders’ value in the company by maintaining stability and improving financial performance. Give back to the community by helping the orphans and poor children of the world. Read the whole Story at: http://www.livetradingnews.com/healthy-coffee-hcei-on-global-mlm-expansion13716.htm
“On the Watch List” contains potential investment opportunities for suitable small, mini and micro cap portfolios.
Red’s Rules to Always Play by… Do what they do on Wall St. and not what they say; that means tune out the “Noise”. Some folks like to buy stocks because they are upgraded, or sell stocks because they are downgraded; that’s the wrong approach. Learn how to evaluate stocks for yourself. It is not a difficult process; the steps are 1) check the volume for a buying or selling patterns, 2) recognize support and resistance levels and utilizing key charting patterns. I use www.stockta.com for my data. Knowledge is Power (and Money) Over my 30+ yrs playing the stock market in earnest, I have learned that there are winning stocks that most traders and investors completely ignore and abhor. And when played right, these overly unappreciated issues often lead to huge gains, but it is all about timing. There is no mystery here; you all know and/or have heard about “penny stocks” i.e. those that trade under USUS$5.00/shr on US markets (10’s of thousands of stocks trade on other world markets under USUS$5.00/shr and are not referred to in the same pejorative manner). This is just a label (designed to diminish their value and keep you away, IMO). The fact is that there are many, many studies made over the years that prove that these stocks outperform the overall market, and when there is a steady new Bull Market, the little stocks (small caps, micro and mini caps) lead the Charge. As a class, they are the most undiscovered and underappreciated sector of stocks and the sector where the biggest chance ends up big winners on a consistent basis. I call them Little Gems; they are indeed Wall Street's buried treasure for those who wish to go treasure hunting. Here, in the RedRoadmaster, I work to uncover solid, moneymaking companies whose shares are grossly undervalued and virtually undiscovered, and they sell for USUS$5 or less a share. And do not forget to always include some small, mini and micro cap (pennies and juniors) sues in your sights; they can give you explosive percentage returns like no others. Savvy traders do not wait for the stock market to hit bottom, recover or get toppy; they do not double down or resort to tricky, desperation moves. They make simple moves on good data and bank some gains. Do not think get rich - think get rich slowly; it works. Even if you know absolutely nothing about how to start making a living in the stock market, and want to learn how to do it, the first step is to learn from someone who knows how to do it successfully. The stock market is about success, and the lifestyle that comes with it, but it must be done carefully, both by picking the issues and in the trading of them, because one wants to make money doing it independently and without stress. You can’t reverse your “bad plays”. Breathe through your nose, count to 10 and move ahead. Go forward, and only focus on what the opportunities are in front of you to win in the stock market game. You do not live in the scrapbook, and always take what the market gives. A journey of a thousand miles begins with the first step (Confucius); Download and read and study “Knowledge is Power,” my e-Book, its Free. Always remember that we look at the risk first and decide how to manage it before ever entering a position. Yes, losses will be incurred; it is part of this and any business, and not a bad thing if they are controlled.
Again, think “get rich steady" and not "get rich quick" and think Education! The Bull is charging, and this perhaps this the best investing scenario since the early 80's. It is happening now and savvy players and investors are positioned and in the action. Remember to always be nimble and take what the market gives. Have a great week, and stay tuned. Paul A. Ebeling, Jnr. aka The RedRoadmaster I am the Co-Founder of www.livetradingnews.com and www.ebeling-heffernan.com. Please check out www.paulebeling.com, www.RedRoadmaster.com and www.bull-penny-stocks.com. Also, you can follow me on Google News and Blogs. You can contact me at Redroadmaster@aol.com Disclaimer The foregoing is commentary for informational purposes only. It is designed to help the reader learn the fine art of technical analysis. Links are provided to articles and stories referenced in this Report. Some statements and expressions are the points of view and/or opinions of Red Roadmaster™, aka Paul A. Ebeling, Jr. and the contributors. This information is not meant to be a solicitation or recommendation to buy, sell, or hold securities. I am not licensed or registered in the securities industry. The information presented herein has been obtained from readily available sources believed to be reliable, but its accuracy is not guaranteed. Estimates, assumptions and other forward-looking information are subject to the limits of forecasting. Actual future developments may differ materially due to many factors. I do not receive compensation in any manner from any of the companies that are discussed in this Report. Please feel free to print and/or send The Red Roadmaster’s Technical Report on the US Major Market Indices ™ to your friends and associates, no permission is necessary. ©2002/2010 Paul A. Ebeling, Jnr.
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