Bulls Must Pick It Up, or……

Investor’s first readDaily edge before the open

DJIA:  17,702
S&P 500: 2,075
Nasdaq  Comp:5,067
Russell 2000: 1,178

Thursday:  Nov. 12, 2015   7:56 a.m.

/////////////////////////////////////////////////////////////////////////////////////////////////////////      

      Three Fed officials speak today – James Bullard (9:05), Jeffrey Lacker (9:45),and Charles Evans (10:15). It will be interesting what their spin will be on the possibility of  a December 16 rate increase.

      Unfortunately, the Fed has stolen the spotlight, upstaging all other considerations for determining the valuation of securities.

      As I have often said, this business is complicated by the fact there are always several balls up in the air, any one of which can come down unexpectedly to change the picture.

      Currently, those balls include 2016 earnings, a highly unpredictable Mid-East, the potential for an international monetary crisis, and something nobody has thought of yet.

TODAY:

      The market has been in a consolidation mode for six days, with the potential for a sharp move up or down at any point.

       The November – April six months period  has earned the reputation as the “Best Six Months” of the year (May 1 to August the worst six months*).  It is hard to deny consistent patterns, except to call attention to the possibility counter moves will occur, i.e. a sharp correction, or more than one, during the best six months  and a sharp rally during the worst six months.

       The Street would like to run stocks higher, but buyers are hesitant with an interest rate increase looming in mid-December.

        However, there is just enough buying to head off a major sell off (so far). 

I can see a 5-day, 500-point move in the DJIA either way this month.               

 >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

SUPPORT “today”: DJIA:17,593; S&P 500:2,062; Nasdaq Comp.:5,036

RESISTANCE “today”: DJIA:17,756; S&P 500:2,081;Nasdaq Comp.:5,082

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>.     

NOTE: Support and resistance levels are where I expect the intraday prices of the DJIA, S&P 500 and Nasdaq Comp. to reverse or close. Buyers should be cautious when a resistance level is reached but consider buying when support levels are reached. Sellers should consider taking action when resistance levels are reached and defer selling when support levels are reached. These levels are picked daily and based on my application of technical analysis.

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

MY TECHNICAL ANALYSIS  of the 30 DJIA Companies

 On occasion, I technically analyze each of the 30 DJIA stocks  for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the DJIA “divisor” (0.149677) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages,
     As of  November 7, 2015,  a reasonable risk is 17,731 a more extreme risk is 17,590. Near-term upside potential is 18,237.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

  • STATUS OF MARKET: Bullish but “at risk” of  a correction, especially Fed-based
  • OPPORTUNITY: RISK: Risk increases with higher market, but light on the Street is GREEN in spite of negatives.
  • CASH RESERVE: 25% – 45% depends on tolerance for risk.
  • KEY FACTORS:  Fed decision on rates; strength of economic rebound; Outlook for Q3/Q4 earnings; Stimulus Europe/China a catalyst !!
  • CONCLUSION: Suddenly, odds of a December bump up in interest rates has increased dramatically. Over the years, the market has sold off when it appeared that an increase was imminent.  It did not do so after the announcement Friday, but did on Monday as the Street began projecting the timing of subsequent rate increases in 2016 – 2017.
    //////////////////////////////////////////////////////////////////////////////////////////////////////////

Note: Source of economic data

For a weekly economic calendar and good recap of  indicators, go to mam.econoday.com.

*Stock Trader’s Almanac

…………………………………………………………

George Brooks
Investor’s first read
A Game-On Analysis, LLC publication

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 

Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk

 

 

 

 

 

 

 

Leave a Reply

Your email address will not be published. Required fields are marked *