Market Talk

[Spaf]

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The Kingdom of TSP

Daily

Market News, Doodles, Tea Leaves & Yak Date June 15th, Closing


Market News.

News:Market reported a bushel of green earnings. Costs subdued in farmers report. Market started with a gap advance. Then Krude having drank too much lube got out of the can.The alarm sounded, and near panic ensued as vestors went hiding behind every bush in the park. Musketeers finallyarrested Krude, but not before his horse Fill-er-up had pooped all over the market area.


Doodles and Tea Leaves.

Doodles:
S&P 500 (Index)
Closing at 1206.58, up +2.67.
CMF (money flow) at 0.202, dn.
RSI (strength) at 62.0, up, in midrange.
MACD (trend) at 7.27, up,nesting at crossover.

Nymex (Crude oil)
Closing at 55.60 up, +0.60.

Tea Leaves: Yellow (caution). Money remains strong. Moderate strength remains in the market. MACD remains questionable; bullish or bearish? Oil above 55 places it in the alarm range.


Yak.

Remarks: Holding 60/40 (60G, 20C, 20S). Alert stop at 1194, trailing stop at 1182.

Rgds, and be careful! Spaf

 

[Guest]

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Shoot on goal.

Kick save by the Fed with their Beige Book at 2pm.



Score on goal after private accounts are on line.

This smacks of last Thursday.

 

[Birchtree]

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Spaf,

Did you see the courage the Mlk-man is showing - 100% S fund. WOW!

The Beige Book was full of sweet good things today - warmed my toes. Industrial production rose stronger than expected 0.4% for May after falling 0.3% in April - that was a 0.7% turn around. Factory output rebounded sharply in June. Maybe inflation pressures will continue in coming months, and then perhaps not. CPI dropped 0.1% in May. This is the first monthly decline in the CPI since 7/04. Core CPI was up 0.1% in May which was less than expectation. We may be getting ready for liftoff.

Dennis

 

[Guest]

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Fed controls the Beige Book.

It curled my toes when Greenie last thursday in front on congress said an inverted yield curve this time will not hurt the economy.

Shoot on goal - kick save by the Fed.

Retail sales are telling me what is going. 70% of this economy is shopping. Great economy - based on consumption. I guess when you do not have a manufactoring base anymore that is all ya got left. :shock:

 

[Spaf]

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Birchtree wrote:

Spaf,

Did you see the courage the Mlk-man is showing - 100% S fund. WOW!

The Beige Book was full of sweet good things today - warmed my toes. Industrial production rose stronger than expected 0.4% for May after falling 0.3% in April - that was a 0.7% turn around. Factory output rebounded sharply in June. Maybe inflation pressures will continue in coming months, and then perhaps not. CPI dropped 0.1% in May. This is the first monthly decline in the CPI since 7/04. Core CPI was up 0.1% in May which was less than expectation. We may be getting ready for liftoff.

Dennis

Yea! But, I got sum questions?

1. Do you guys want to be called astronauts, or bullonauts?
2. Did you name your rocket ship? If so, what's it's name?

I and maybe others appreciate your post (as above) where U use market data to communicate your position, or why U are doing this or that.

Good luck on your rocket ride. Hope you guys come backwith a lot of that green-cheesee stuff!

Have a safe trip!Regards :^ Spaf

 

[Birchtree]

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If I recall wasn't our recent export number an all time record - granted not equal to imports yet, but it takes time to make improvements. Let me see now- this makes 5 straight - want to predict tomorrow? The Technician should be telling you we are ready for a breakout liftoff from this sideways consolidation. I'd actually prefer we continue this grinding higher with higher lows - making some good progress. But I can't control what is going to happen - only be prepared to take opportunity. Hope to see you from higher levels. It is really to dangerous to come out of the shelter yet according to Chicken Little and Yogi.

 

[Spaf]

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DMA wrote:

Retail sales are telling me what is going. 70% of this economy is shopping. Great economy - based on consumption. I guess when you do not have a manufactoring base anymore that is all ya got left.

Yep DMA. This reply is from my (my wife's) new Gateway Laptop, made in China! She had a software glitch, we got it fixed from a service tech in India!

It's called the sharing of capitalism! If it works don't fix it! Spaf

PS: My NEW Dodge truck spent 2 weeks in the shop for a wire that wasn't properly connected.

I had a splinter in a olive, in a martini from a product manufactured in Muncie IN.

Sorry, I'm bullish on America. I'll get it fixed. I won't buy a (totally) foreign car, but I may change to plastic for my martini olives!

 

[biggdog1]

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I don't know about the rest of you, but I would just as soon see the small gains we're getting (even though they are scary) every day instead of a huge gain in one day and giving it all back over the next four. I for one am perfectly happy as long as I see GREEN in the end :u. My Lab Bambi seems just as happy with small bones or bigguns. You guys take care and just be happy we're earning.

 

[Spaf]

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biggdog1 wrote:

My Lab Bambi seems just as happy with small bones or bigguns. You guys take care and just be happy we're earning.

We are biggdog1

Just yaking about Birch and Milk wanting a rocket ride!

The small advances are good, it keeps the pirates away! Spaf

 

[Guest]

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Spaf you hear this one?

McDonald's has out sourced their drive through window people.

You drive up and place your order with the voice on the speaker. The person you talking to is in Cebu, Philippines. The person in the Philippines takes the orders PMs it to the robots by the friers and they make it and bag it.

After several months of negotiations with McDonald's franchise holder Kenneth Yang -- son of taipan George Yang, Pilipinas Teleserv Inc. has bagged a contract to develop McDonald's Philippines call center-based service and eventually the fastfood chain's online ordering facility.

Or your xrays and cats scans etc are scanned and e-mailed to India and they read them and e-mail the results back.

The worse is WebMD you go in a room with a nurse stand in front of a camera and a doc in India does the dianoses.

We will all turn into waiters, haircutters or cleaners but the time this is done to service the rich foreign tourists coming here to vacation due to our cheap $s.

It is called the bottom line. :^

 

[Birchtree]

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Spaf,

I've been watching the S fund outperform recently - and think it is related to the big position in the energy field. I've been hitting the target these days with this sideways action - can't really complain. No name for the rocket ship - open to suggestions though. We had just a very small taste of power Tuesday when in less than 30 minutes the Dow was up 100, and then poof - gone. I can't help but remember days gone by when 400 points from lower levels was the start of back to back moves of 400 points. I truly think we are building - just can't see the catalyst at this point. Maybe a European Fed cuts their rates to spur their economy - maybe the Iraq thing ends in amnesty, maybe our Fed has infact paused, just wish I knew.

Dennis

 

[Spaf]

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DMA............Birch You guys have a great day! Thanks the talk!

U know at my age, investments is all U have to play with! :' .....

 

[Guest]

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Snow Job is out poking the stick at Euroland now.

Maybe that will help. Maybe we need to look inward?

Thursday June 16, 2:44 AM
Snow Urges European Financial Reforms

U.S. Treasury Secretary John Snow urged the EU on Wednesday to push ahead with structural reforms, saying that "Europe can do better" if it removes barriers to its economic growth.

"It's clear that Europe is making enormous strides in creating one open financial market," Snow said after talks with French Finance Minister Thierry Breton.

Snow, on a tour of Europe following a meeting of the Group of Eight finance ministers in London, has repeatedly called on Europe to forge ahead with difficult economic reforms to promote growth.

"By getting the capital markets open and competitive, we'll add enormously, I think, to the prosperity of Europe and to the prosperity of America."

Leaders of the 25-nation EU are pursuing a plan of financial reforms to cut red tape, speed up financial transaction settlements and facilitate mergers and acquisitions across borders.

"We all share this sense that Europe can do better," Snow said. "The U.S. can do better, Europe can do better. As you do better, we can do better."

Breton, standing beside Snow, said that the U.S. and France shared the problems of high debt and high deficits, and cited the dollar as the reason for imbalances in the exchange rate between the U.S. currency and the euro.

"Each time I see John Snow, we have a discussion and I tell him, 'It's not the euro, that's too strong. It's the dollar that's too weak," Breton said. He added, however, that the euro's recent weakening to the dollar showed that "things are evolving in a positive way."

 

[pyriel]

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Birchtree wrote:

Spaf,

I've been watching the S fund outperform recently - and think it is related to the big position in the energy field. I've been hitting the target these days with this sideways action - can't really complain. No name for the rocket ship - open to suggestions though. We had just a very small taste of power Tuesday when in less than 30 minutes the Dow was up 100, and then poof - gone. I can't help but remember days gone by when 400 points from lower levels was the start of back to back moves of 400 points. I truly think we are building - just can't see the catalyst at this point. Maybe a European Fed cuts their rates to spur their economy - maybe the Iraq thing ends in amnesty, maybe our Fed has infact paused, just wish I knew.

Dennis

Birch,

You are right but it is also because of the tech industry... Me thinks S fund will be the leader for this year...

 

[Guest]

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Stocks in S fund do not do well in a raising rate environment (fed tighting schedule).

Due to they have a lot of outstanding loans. Rates go up their loan interest payments go up.

What did the worse in the 2000 raising rate environment?

NASDAQ fell 77%.

S fund will underperform and be the worse fund of the year.

S fund is 6% energy - oh by the way. S fund outperform recently - and think it is related to the big position in the energy field

oh yeah, IMHO.

 

[Spaf]

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pyriel wrote:

Me thinks S fund will be the leader for this year...

Who! pyriel pls read p3 of The Dow Theory! Tom was right in analysis of $TAN. Except for a confirmation with $SPX. Market=caution. Too many mixed signals.
The play is G or conservative or risky if aggressive. Careful, my friend! Spaf

 

[Guest]

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Spaf wrote:

pyriel wrote:

Me thinks S fund will be the leader for this year...

Who! pyriel pls read p3 of The Dow Theory! Tom was right in analysis of $TAN. Except for a confirmation with $SPX. Market=caution. Too many mixed signals.
The play is G or conservative or risky if aggressive. Careful, my friend! Spaf

What type of stocks get hurt the worst when their interest payments go up?

The small fries. IMHO :shock: Actually it is not my HO it is a fact.

Number three holding in S fund Sirus Sat Radio - have you looked at their balance sheet. :s

 

[Mike]

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How the S fund does in the remainder of the year depends on the Fed.

If there's only one more rate hike of 0.25, I'd say the S fund will retain top position on the year. However, if there's two or more hikes, it *should* start lagging.

In January, I thought C would lead this year. That one has been disappointing.

 

[Guest]

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I believe C fund is better S and Ifund YTD.

So you were spot on, Mike.

---------------

Most important piece of economic news tommorrow comes out at noon.

Phil Fed Survey - what it says will probably guide the direction of trading.

Still have a lot of shorts. But at 2pm today most covered. I will be flat as soon us I can sniff out the morning direction.

Happy trading!!!!!!!!!

 

[Mike]

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By the numbers...

12-31-04: G 10.68 / F 10.42 /C 12.91 /S 14.73 /I 15.48

6-15-05: G 10.89 / F 10.59 / C 12.96 / S 14.96 / I 15.22

G fund has gained 1.97% <-leader
F fund has gained 1.63%
C fund has gained 0.39%
S fund has gained 1.56%
I fund has lost 1.68% <-lagger

The guesswork (rest of the year):

When will the S fund honeymoon end? I've read many articles pointing out that small caps lead early in an economic expansion (i.e. the ridiculous gains in 2003) and fade late (~ 1 1/2-2 years in). We are now past that point by a few months, and the S continues leading the way. My thinking: the S will lag after the next rate hike (I think we have two more coming this year).

When will the C fund take over as it has in the past? The conventional wisdom says it should have happened already... meaning we are in a rather unusual situation at this point in the economic expansion. I still think the C fund will take over at some point - with the fall of this year being my best guess. We should have a rate hike between now and then, which will hurt the S fund (due to the heavier borrowing that occurs in small cap companies).

When will the I fund stop bleeding? Eurozone growth is ugly (GDP growth over there is almost completely flat). US interest rates are higher now, which is attracting the foreign capital and strengthening the dollar. Until the US stops raising interest rates and Europe gets its act together economically and starts growing a bit more robustly, there is little to no reason for the dollar to break down. I'll say that the I fund will be the worst performing stock fund of the year - and finishing in the red is a realistic possibility, barring some minor miracle on the currency market. Of course, if you are interested in the very long term, there should be a nice little buy-in opportunity as the fund continues shedding value.