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Again this week there is more economic data, none on Monday though, and it is on the light side of heavy.

Also, there are earnings too, and the market technicals to consider.

It is interesting to note that the US market has been down on 9 straight Mondays, and up on 6 straight Fridays.

The Technicals are looking very good in here, with higher lows and higher highs, it is # 5 on the S & P 500 higher highs now.

The DJIA is right there, and the NAS is trailing. The SP500 looks so solid but will it pull the NAS and DJIA further North without US Fed getting aggressive with QE.

This current rally has been a good one, and technically positive, but it is getting closer the 1410/1415 target. And it could top out there, but not necessarily so, it is not written in the book.

But, it there is a slowing of the momentum, then it is prudent to take some profits.

Again, technically the market looks good, is moving higher, and we could see a healthy pullback Monday that sets up new buy points. Remember, the last 9 Monday’s running the market has been down on Monday, if it happens again then take advantage of the move, be alert, it might be a fast test to set up for the extension of this rally.

                                          Red’s Bull and Bear Trade Alerts

Red’s Options Trade Alerts:  eBay (NASDAQ:EBAY), Cognizant Technology Solutions Corporation (NASDAQ:CTSH)

See them daily at www.livetradingnews.com

Paul Ebeling on Wall Street, what to expect this week…

Again this week there is more economic data, none on Monday though, and it is on the light side of heavy.

Also, there are earnings too, and the market technicals to consider.

It is interesting to note that the US market has been down on 9 straight Mondays, and up on 6 straight Fridays.

The Technicals are looking very good in here, with higher lows and higher highs; it is # 5 on the S & P 500 higher highs now.

The DJIA is right there, and the NAS is trailing. The SP500 looks so solid but will it pull the NAS and DJIA further North without US Fed getting aggressive with QE.

This current rally has been a good one, and technically positive, but it is getting closer the 1410/1415 target. And it could top out there, but not necessarily so, it is not written in the book.

But, it there is a slowing of the momentum, then it is prudent to take some profits.

Again, technically the market looks good, is moving higher, and we could see a healthy pullback Monday that sets up new buy points. Remember, the last 9 Monday’s running the market has been down on Monday, if it happens again then take advantage of the move, be alert, it might be a fast test to set up for the extension of this rally.

Remember, be alert and always take what the market gives.

Have a great week.

All the best,

Paul A. Ebeling, Jnr.

Re-cap of the US Markets for the Week ended 3 August 2012

                                         Wall Street rises to highest mark since May

US stocks rallied Friday, driving the Standard & Poor’s 500 Index to the highest level since May, after data showed payrolls climbed more than forecast even as the jobless rate unexpectedly rose to a 5-month high.

The S&P 500 advanced 1.9% to 1,391.03, after dropping 1.5% in the 4 days prior.

DJIA 13101.28 +217.29 (1.69%)

NAS 2967.90 +58.13 (2.00%)

S&P 500 1390.99 +25.99 (1.90%)

10-yr T-Note -26/32 1.570

Adv 2537 Dec 516 Vol 753.6-M

NAS Adv 1929 Dec 570 Vol 1.68-B

Industry Watch: Strong: Financials, Energy, Industrials

Of the 402 companies in the S&P 500 that have reported Q-2 earnings through Friday morning, 68% have beaten analysts’ expectations, which is consistent with the past 4 Q’s.

Volume and Breadth: About 6.5-B shares changed hands on the NYSE, AMEX and the NAS, slightly below the daily average so far this year of 6.75-B shares. Advancing issues beat decliners by a ratio of almost 5 to 1, on the NAS more than 3 issues rose for each 1 that fell.

                                           US Major Market Indexes Technical Analysis

Stocks fell over the last 4 days as Fed Chairman Ben Bernanke and European Central Bank President Mario Draghi failed to reassure investors on immediate efforts to bolster growth. Members of German Chancellor Angela Merkel’s coalition parties signaled acceptance of the ECB’s plan to buy government bonds.

US Equities gained as payrolls last month increased 163,000 following a revised 64,000 rise in June.

Economists projected a gain of 100,000. Unemployment rose to 8.3%.

The Institute for Supply Management’s index of U.S. non-manufacturing businesses, which covers about 90% of the economy, rose to 52.6 in July, beating estimates.

Uneven hiring is holding back consumer spending, the biggest part of the economy, as a global slowdown and impending US tax changes weigh on businesses.

Job cuts at companies from Morgan Stanley (NYSE:MS) to Cisco Systems Inc (NASDAQ:CSCO) means unemployment may remain elevated, one reason the US Federal Reserve this week said it is prepared to take new steps if needed to boost growth, that could occur in September or earlier.

The July ISM Services index was reported at 52.6, slightly above the 52.3 Briefing.com consensus, and up from June’s 52.1 reading.

European indices closed firmly higher after yesterday’s volatile session. Italy’s MIB and Spain’s IBEX soared by 6.3% and 6.0% respectively. France’s CAC jumped 4.4% and Germany’s DAX gained 3.9%.

U.S. listings of European financials rose sharply with Deutsche Bank (NYSE:DB) 31.21, +2.86 and Barclays (NYSE:BCS) 10.66, +0.61 gaining 10.0% and 6.1% respectively.

The strength in European banks followed a significant drop in Italian and Spanish yields. Italy’s 2-yr yield declined 54 basis points to 3.11% while Spain’s 2-yr yield eased 88 basis points at 3.91%.

The financial sector was the best performer today. With considerable gains throughout, Morgan Stanley (NYSE:MS) 13.78, +0.75) gained 5.8% while Citigroup (NYSE:C) 27.41, +1.23 rose 4.7%.

Knight Capital Group (NYSE:KCG) 4.05, +1.47 has rebounded off all-time lows after securing a line of credit which has allowed the firm to continue operating for the day. Despite today’s rally, shares of Knight remain down 60.9% on the week. It is expected that some sort of longer-term resolution for KCG will come next week, with reports today suggesting several potential bidders/investors are reviewing the company.

LinkedIn (NYSE:LNKD) 108.51, +15.00 gained 16% after reporting in-line EPS and better than expected revenues and full-year guidance. Today’s considerable bid has taken the shares above the 20- and 50-Day Moving Averages.

Procter & Gamble (NYSE:PG) 65.50, +1.99 gained 3.1% after beating earnings estimates but coming up short on revenues.

The dollar index was considerably lower amid today’s risk rally. At 82.45, the index ended down 1.1%. The EUR was the top performer among the major currencies against the USD with today’s 200 pip advance running it up to 1.2375.

Other currencies which saw strong gains include the Australian dollar (up 0.9% at 1.0555) while the GBP has added 0.8% to 1.5640.

Crude Oil got a major boost Friday, gaining nearly 5% after the better than expected employment data, positive performance in Europe while also benefitting from the dollar’s decline. The energy component lifted from its session low of $88.31 per barrel and steadily climbed higher, settling just below its session high of $91.79. Despite selling pressure seen in previous sessions following little-changed FOMC and ECB statements, crude finished the week with a 1.4% gain at $91.40.

On the week: Monday’s equity markets were quiet for the duration of the session with the S&P 500 finishing nearly flat on the day. One notable deal was announced before the open.

Shaw Group (NYSE:SHAW) 39.47, +0.43 gained 55% after the firm was acquired by Chicago Bridge & Iron (NYSE:CBI) 36.44, +1.00 CB&I will pay a total of $3-B or 46 per share of Shaw.

Tuesday’s action was similar to that observed on the day before as the major indices hovered around their respective unchanged levels for most of the session. Low volume and in-line economic data contributed to an uneventful session as investors awaited comments from the Federal Reserve and the European Central Bank later in the week. As far as earnings, US Steel (NYSE:X) 21.72, +0.66 was one of the day’s best performers, finishing up 9% after it beat earnings expectations. The S&P 500 edged lower by 0.4%.

On Wednesday before the open, The ADP National Employment Report indicated employment in the nonfarm private business sector rose 163-K in July. This was above the 125-K expected by the consensus. About 15 minutes following the opening bell, approximately 150 stocks began to behave erratically.

It was later determined that a technology issue at Knight Capital Group was behind the abnormal activity. Later in the day, the Federal Open Market Committee repeated that it would ‘monitor incoming information on economic and financial developments and will provide additional accommodation as needed.’ The FOMC kept its pledge to keep rates low to at least late 2014. The S&P 500 fell 0.3 that day.

Thursday’s trade was focused on the comments from European Central Bank President Mario Draghi. During his press conference, Mr. Draghi failed to announce new measures to help stem the European debt crisis. Knight Capital Group finished near session lows as Wednesday’s execution glitch is said to have cost the firm $440 million in direct losses. Several firms have indicated that they have used other systems to route their orders. The S&P 500 finished down 0.7%. In Corporate news, Abercrombie & Fitch (NYSE:ANF) 29.37, +0.31 fell 14.6% after issuing disappointing guidance. Finally, retailers reported July same store sales, which overall came in above expectations with sixteen retailers beating estimates—the most since April of last year (three companies missed).

Just over 80% of the S&P 500 has reported quarterly results so far during this earnings season. Roughly two thirds of them have beat earnings estimates, and roughly 56% of companies have missed sales expectations. Guidance has been cautious.      ____________________________________________________________________________________

Red’s Options Trade Alert:  eBay (NASDAQ:EBAY)

EBay options contracts experienced a very low Put/Call Ratio (PCR) during Friday’s trading session.

The volume of Put contracts vs. Call contracts was 0.07, 3,501 Put and 53,667 Call contracts exchanged hands Friday.

PCR can be regarded as a predictor of investment sentiment, indicating what experienced investors are doing in preparation for a move of an underlying equity.

A high PCR suggests that the investor sentiment is Bearish and that investors are expecting the underlying stock price to decrease.

A low PCR implies that the investor sentiment is Bullish and that investors are expecting the underlying stock price to increase. So, unusual volume provides reliable signals that the stock is expected to make a move.

EBay traded at 44.50, + 0.73 (+1.67%) in Friday’s trading session.

The daily low was 44.38 and the high 45.21 as it moves to a new 52 wk high

Volume: 8-M is below the 3 month average volume of 13-M shares.

EBAY is trading above its 50 and 200-Day Moving Averages.

The stock’s 52 wk low is 26.86 and 52 week high is 46.15.

Analyst recommendation: Hold

Performance indicators show that the stock has gained 8.40% within the last Quarter.

Week     Month   Quarter    Half Year
-0.05%  6.24%   8.40%        33.85%    35.72%

Recent CandleStick Analysis Neutral

Technical Indicators

Disclaimer: The material presented in this commentary is provided for informational purposes only and is based upon information that is considered to be reliable. Neither Ebeling-Heffernan, www.livetradingnews.com nor its affiliates warrant its completeness, accuracy or adequacy and it should not be relied upon as such. Neither Ebeling-Heffernan, www.livetradingnews.com nor its affiliates are responsible for any errors or for results obtained from the use of this information. This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities or other financial instruments mentioned in this material are not suitable for all investors. Any opinions expressed herein are given in Good Faith, are subject to change without notice. Before acting on any information contained on the website, you should consider whether it is suitable for your particular circumstances and strongly consider seeking advice from your own financial or investment adviser.

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This Week on the Economic Front in the USA

 6 August – Monday

None

7 August – Tuesday

Consumer Credit, June (15:00): $10.0-B expected, $17.1-B past

8 August – Wednesday

MBA Mortgage Index, 08/04 (7:00): 0.2% past

Productivity-Preliminary, Q-2 (8:30): 1.5% expected, -0.9% past

Unit Labor Costs -Pr, Q-2 (8:30): 0.4% expected, 1.3% past

Crude Oil Inventories, 08/04 (10:30): -6.522-M past

9 August – Thursday

Initial Claims, 08/04 (8:30): 375-K expected, 365-K past

Continuing Claims, 07/28 (8:30): 3290-K expected, 3272-K past

Trade Balance, June (8:30): -$47.5-B expected, -$48.7-B past

Wholesale Inventories, June (10:00): 0.3% expected, 0.3% past

10 August – Friday

Export Prices ex-agri., July (8:30): -1.4% past

Import Prices ex-oil, July (8:30): -0.3% past

US Treasury Budget, July (14:00): -$129.4-B past

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This Week on the Earnings Front in the USA

Monday: HCA Holdings (NYSE:HCA) and Tyson Foods (NYSE:TSN) before the open.

Tuesday: CVS Caremark (NYSE:CVS), Emerson Electric (NYSE:EMR), and PG&E (NYSE:PCG), after the close, Walt Disney (NYSE:DIS) reports.

Wednesday: Avnet (NYSE:AVT), HollyFrontier (NYSE:HFC) and Macy’s (NYSE:M) will report before the open, followed by CenturyLink (NYSE:CTL) after the close.

Thursday: Kohl’s (NYSE:KSS), Manulife Financial (NYSE:MFC), and Novo Nordisk (NYSE:NVO) report before the open

Friday: Brookfield Asset Management (NYSE:BAM) reports.

For the complete list go to: http://biz.yahoo.com/research/earncal/20120806.html

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                                   The Most Asked Question last Week

The Big Q:  Red, will big time Market Maker, Knight Capital survive?

The Big A:   Knight Capital (NYSE:KCG) looking for investors, Citadel, KKR bowed out, the Street’s questions about Knight’s liquidity looms.

Knight Capital Group Inc. is fighting for its survival after a $440-M last week loss driven by a software failure is working to find an investor after 2 potential suitors said they were no longer interested.

Citadel LLC and KKR & Co. are no longer exploring an investment. Knight, responsible for about 10% of American equity volume, turned to Goldman Sachs Group Inc. (NYSE:GS) on 1 August to buy the firm out of trading positions acquired by mistake when a computer program malfunctioned, a person with knowledge of the matter said. It has until the close of business on 6 August to complete the transaction.

The Street now has a lot of questions about Knight’s liquidity; do they have the money to get through the trade settlement on Monday, they have to find somebody to either invest capital into the company or somebody who’s just going to buy the company outright IMO.

Citadel, a hedge fund that has a market-making and electronic-trading business, walked away from talks Saturday with no comments, the same is thought for KKR.

Knight may raise $400-M through the sale of convertible bonds to investors including Getco LLC and TD Ameritrade Holdings Corp., according to a TV report.

Knight made it to the weekend after receiving short-term financing for market making. TD Ameritrade and Scottrade Inc., which sent trades elsewhere for execution after Knight’s software failure, said on 3 August they were routing orders back. Knight’s stock rose 57% to 4.05 in New York after falling 75% in the prior 2 sessions.

Thomas Joyce, Knight’s CEO was in meetings at the company’s headquarters in Jersey City, New Jersey, according to his secretary on 4 August, he did not return a call seeking comment.

As the company opened its books to potential saviors, KKR, TPG Capital and Silver Lake were among buyout firms that had an initial interest although one said chances of a private-equity deal are small.

Citadel had expressed interest, as has Two Sigma Securities LLC, a New York-based market maker, people with direct knowledge of the matter said.

A spokeswoman for Chicago-based R.J. O’Brien & Associates declined to comment on 3 August, after a newspaper report that the company was among a group of potential buyers in talks about Knight’s futures brokerage.

Kara Fitzsimmons, a Knight spokeswoman, declined to comment Sunday. David Wells, a spokesman for New York-based Goldman Sachs, said he could not comment.

“I seriously doubt they will go out of business,” Kenneth Pasternak, who co-founded Knight in Y 1995, said in an interview on 3 August. Mr. Pasternak bought shares in Knight during its 2-day plunge. “I just hope they can maintain. My fear is they will be bought by some big bank and become consumed.”

Knight is working with Sandler O’Neill & Partners LP as its advisers in the rescue talks.

The trading fault, which caused stocks to move as much as 151%, left the firm with a “large error position,” Knight’s CEO, Thomas Joyce said on 2 August.

Knight may or may not have the ability to withstand this on a balance sheet basis, but their biggest risk is if people decide not to do business with them, as confidence with a counterparty like a Knight is only as strong as their skills as well as their balance sheet.

Fitch Ratings said in a statement that it does not expect any major counterparties of Knight to suffer large losses even in a bankruptcy scenario since many have already switched to other market makers. The issue still may lead to a structural change in the business, the ratings firm said.

The events precipitated by Knight’s malfunction “pose risks for equity trading volume as many investors become more concerned about seemingly unforeseeable risks related to trading technology problems and the broader market impact of high- frequency trading systems that periodically break down,” Fitch said in the statement.

Knight’s $440-B loss compares with net income of $115.2-M in Y 2011 and is more than the company’s market value as of 3 August. The company was worth as much as $4.8-B in Y 2000 and valued at more than $1-B before the trading mistakes, according to data.

The loss represents about 40% of Knight’s book value and would “exhaust” the firm’s cash. Knight had $365-M of cash as of the end of June, with about $70-M in its revolving credit line.

Knight’s market-making unit executed a daily average of $19.5-B worth of equities in June, according to its website. The unit traded 711-M exchange-listed shares a day in June.

The NYSE reviewed trading in 140 stocks from Molycorp Inc. to AT&T Inc. as the market’s 1 August open was disrupted. Trades that occurred during the height of the volatility were canceled in 6 securities, where prices swung at least 30% in the 1st 45 mins. Trades in all of the other stocks were allowed to stand.

George Smaragdis, spokesman for the Financial Industry Regulatory Authority, said on 3 August that FINRA has examiners at Knight and is working with the firm and other regulators to review the impact of the incident.

Securities and Exchange Commission Chairman Mary Schapiro, whose agency is the main market overseer in Washington, described the Knight event as “unacceptable,” and promised to issue regulations to help prevent similar mishaps.

.Paul A. Ebeling, Jnr

PS: We here at LTN are focused on natural resources, agriculture, the Singapore $, and quality stocks that offer steady returns and high dividends, we call them Aristocrat Stocks (and the events that shape the market prices) and profile them weekly on www.livetradingnews.com . They are not priced to make investors a fortune, but they are priced to give approximately 4 to 5% real return on capital, that beat the bank deposit rates soundly and risk is avoided.  Pay attention and Cheer up.

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!

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Red’s Edge and in the Trenches

                                            Reflect and Resolve to Make Money

The area that I believe to be of great importance to those of us who have a keen interest in trading markets is how to better Play the Game of trading and investing.

The 1st thing to do, IMO, is to reflect on what was done last year and how well it was done. I believe it will be the common denominator that some stuff was done well and some not so well. That said it would be a good plan to work to be better at what was not done so well in this New Year.

Looking into the past may be helpful to put together Resolutions that will bring positive changes that bode well for future action in the markets, in order to set up for continuing success.

The common areas that most all traders/players work on to improve in order to continuously post good Percentage and Money records are:

1. Formulate a Trading Plan for their business; this is a business, though many of refer to it as a Game.

2. Follow and fine-tune the Trading Plan along the way.

3. Learn to Cut Losses

4. Stop Cutting Profits

5. Manage your money; remember Your Money and Your Responsibility.

6. Education, Education and more Education, Knowledge is Power.

7. Last but not least are; never enter a position without a Way Out (aka Exit Strategy)

Lumped into 1 Key Trader/Player Resolution and followed will likely lead to improved trading results.

That said, always strive to do your best, use the best tools, be patient with yourself and be happy.

Each new day comes with new opportunities, challenges, and changes.

All the best,

Paul A. Ebeling, Jnr.

PS:  if you look at yourself as a player/trader, and you like doing it, then it is Key to understand what makes you “tick”; plus it is very helpful to understand the motivations for your 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

To succeed in trading, a Player needs Knowledge; Gain it and use it wisely

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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 “Plan” 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 come the Risk factors that give 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. Insurance…

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.

                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 Favorite Quote for this Week:  “There are three kinds of lies: lies, damn lies and statistics.” Benjamin Franklin

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                                                 Hot Topics

See all of the Latest World News on www.livetradingnews.com up-dated hourly 24/7

In View:  Is Obama targeting Las Vegas Sands (NYSE:LVS) for money laundering?

Las Vegas Sands Corp, controlled by billionaire Republican donor Sheldon Adelson, is the target of a federal investigation into possible violations of US money-laundering laws.

The Los Angeles US attorney’s office is looking into the casino company’s handling of the receipt of millions of dollars from a Mexican businessman, later indicted in the United States for drug trafficking, and a former California businessman, later convicted of taking illegal kickbacks, according to lawyers involved in the matter. The transactions date from the mid-2000′s.

The report said there are no indications that actions by Adelson, who is the company’s CEO and largest shareholder, are being investigated.

The Los Angeles US attorney could not be reached for comment Saturday.

A Las Vegas Sands spokesman said, “The company believes it has acted properly and has not committed any wrongdoing.” He said the company was cooperating with federal investigators.

The timing of the investigation opens the Obama admin’s Justice Department to criticism that it is politically motivated.

Mr. Adelson is a major donor to the super PAC supporting presumed Republican presidential nominee Mitt Romney against President Barack Obama and plans to spend $100-M on Republican candidates in November’s elections.

Mr. Adelson, who owns casinos in Las Vegas, Macau and Singapore, began this campaign season as a major donor to Newt Gingrich before Gingrich dropped out of the Republican presidential race. He has since switched his support to Romney and last month was in Jerusalem with the candidate when Romney met Israeli Prime Minister Benjamin Netanyahu, who Adelson also strongly supports.

The report says the Las Vegas money-laundering investigation focused on 2 big-money gamblers, that Sands officials ignored warning signs and did not alert federal authorities about millions of dollars the gamblers had deposited.

One of the big players is identified as Zhenli Ye Gon, a Chinese-born Mexican national who was indicted in Y 2007 in the United States on charges of dealing in materials used to make methamphetamine.

The drug case was dismissed in Y 2009 but Ye Gon is still in US custody awaiting extradition to Mexico, where authorities want to try him on drug trafficking and money laundering charges according to court records.

The other is Ausaf Umar Siddiqui, a former executive with the Fry’s Electronics retail chain, also was under scrutiny. Court filings in a separate case showed Mr. Siddiqui sent more than $100-M to the Sands. Mr. Siddiqui was charged with taking kickbacks from Fry’s vendors, he pleaded guilty and is now in prison.

US authorities also are investigating the Las Vegas Sands to see if there were breaches of the Foreign Corrupt Practices Act (FCPA), which prohibits bribes to foreign officials by US companies, in its Macau operation.

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Eurozone Watch:  Italy’s PM tells Germany, we need your moral support, not your cash.

Italy needs moral support from Germany but not its cash, Prime Minister Mario Monti said in an interview published Sunday as German conservatives renewed calls for Greece to leave the Eurozone.

The Italian leader told weekly magazine Der Spiegel that he was concerned about growing anti-Euro, anti-German and anti-European Union sentiment in the parliament in Rome.

The German government has resisted calls from Italy and struggling countries to introduce common Eurozone bonds or take other action to help alleviate the bloc’s sovereign debt crisis, saying it would remove pressure to enact painful reforms.

On Sunday, a senior member of Chancellor Angela Merkel’s conservative alliance, Bavaria’s finance minister Markus Soeder, said Greece would leave the Eurozone by the end of Y 2012.

“I’ll stay in office if all goes according to plan until April 2013, and I hope that I can help rescue Italy from financial ruin with moral support from some European friends, especially Germany,” Mr. Monti told Der Spiegel.

“But I say quite clearly: moral support, not financial,” he added. “I emphasize: not with financial help. But they should cut some slack to those countries that are following the European guidelines precisely.”

Mr. Monti pointed out that, while 5 Eurozone countries have received or requested international bailouts, Italy has not yet received “a single Euro” of help.

“I’ve got the impression that the majority of Germans believe Italy has already received financial aid from Germany or the European Union, that is not the case. Not 1 Euro.”

German loan guarantees and contributions to the Eurozone’s EFSF and ESM rescue funds total around EUR400-B.

Mr. Monti added that Germany benefited from being in the Eurozone. “It is the biggest beneficiary of the common market,” he said, referring to the country’s export-oriented economy.

The high borrowing costs Italy is paying are indirectly helping Germany, he added: “Germany is profiting from the low interest rates it is paying for its government bonds … the high interest rates, that Italy is now having to pay, is subsidizing the low interest rates that Germany is paying.”

Mr. Soeder, a leader of the Christian Social Union (CSU) that is the Bavarian sister party to Merkel’s Christian Democrats (CDU), said in an interview in Bild am Sonntag newspaper on Sunday that Greece should quit the Eurozone.

The CSU has often been more critical of EU bailouts than Ms. Merkel’s party, and the German public has doubts about further guarantees for struggling Eurozone nations.

“According to my forecast, Greece should leave the Eurozone by the end of the year,” he said. “Germans can no longer be the paymaster for Greece. Every new bit of aid, every relaxation of the guidelines would be the wrong way to go.”

Soeder added giving Greece further financial help “is like trying to water a desert”. He also said: “At some point, everyone’s got to move out of mum’s house and for the Greeks the time for that is now.”

Separately, German Foreign Minister Guido Westerwelle said it was his party, the small Free Democrats (FDP), that had fought hard to prevent the introduction of common Eurozone bonds. The FDP is battling to stay above the 5% threshold needed to win seats in parliament ahead of next year’s election.

Without the FDP in the German government, we would have had Eurozone bonds a long time ago,” said Mr. Westerwelle, adding he would urge his party to take that issue “offensively into the election campaign. The FDP should make a central issue out of it.”

ASEAN Watch: Cambodia to host 44th ASEAN Economic Ministers Meeting this month

The 44th ASEAN Economic Ministers Meeting and related meetings will be held in Siem Reap, the cultural province of Cambodia from 25 August to 1 September, according to a press release from Cambodia’s Ministry of Commerce on Saturday.

Cambodian Prime Minister Hun Sen will open the 44th meeting on 27 August, said the press release.

The meeting will discuss topics relevant to trade liberalization and economic cooperation among the 10 ASEAN member states and with dialogue countries including China, South Korea, Japan, Australia, New Zealand, India, the United States, Canada and Russia.

The ASEAN economic ministers will also have joint meetings with the 26th ASEAN Free Trade Area (AFTA) Council and the 15th ASEAN Investment Area (AIA) Council, it said.

There will also be a consultation meeting between ASEAN economic ministers and head of the World Intellectual Property Organization, it said.

Besides, there will be the ASEAN-U.S. Business Summit and Cambodia’s Garment and Textile Expo.

The Association of Southeast Asian Nations (ASEAN) groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

BRICS Watch:  China at development Cross Roads

China’s annual GDP growth slowed to 7.6 percent in the second quarter of 2012, down from 8.1 percent in the first quarter and the lowest growth rate since the second quarter of 2009.

The newly released growth data may have dispelled fears of a hard landing for China, but have nonetheless prompted many to argue that China must stimulate its economy further to guarantee 8 percent annual growth.

Since early 2010, in order to contain inflation and property bubbles, the Chinese government has tightened monetary policy. As a result, inflation fell in June to 2.2 percent, a 29-month low, and house prices, for which the National Bureau of Statistics unfortunately has stopped issuing official data, seem to be stabilizing, and may even have fallen, albeit modestly.

The slowdown in China’s growth rate is, to a certain extent, a reflection of the success of the government’s effort to rein in the real estate bubble, as well as of other official policies aimed at rebalancing the economy. The growth rate of investment in real estate development, which directly accounts for more than 10 percent of GDP, plummeted by 16.3 percentage points year-on-year in the first half of 2012. That led to an investment slowdown in many related industries, such as construction materials, furniture and appliances, causing annual growth in fixed-asset investment to fall from 25.6 percent to 20.4 percent.

The trend for household consumption is less clear. But many economists have found evidence that growth in household consumption in the first half of 2012 was stronger than official statistics have shown.

The slowdown of the economy in 2012 should have been anticipated in 2011 by the government. In early 2012, in his speech to the annual National People’s Congress, Premier Wen Jiabao, explaining why the government’s indicative target for economic growth in 2012 was 7.5 percent, pointed out that the purpose was “to guide people in all sectors to focus their work on accelerating the transformation of the pattern of economic development and making economic development more sustainable and efficient”.

In fact, to create adequate space for changing the GDP-centered growth pattern, China’s 12th Five-Year Plan (2011-15) set an indicative target of 7 percent annual average GDP growth.

China’s investment rate is about 50 percent of GDP, while real estate investment accounts for more than 10 percent of GDP. Given the prevalence of repetitive constructions and ubiquitous waste, investment efficiency is deteriorating quickly. With an annual growth rate of 10 percent, an investment rate of 50 percent implies a capital output ratio of five, which is unusually high relative to other countries.

China’s consumption rate is 36 percent. If government statistics are reliable, this rate is simply too low. While huge amounts of money have been poured into physical infrastructure, public expenditure on human capital and social security is below the world average. More resources should be reallocated from physical capital formation to human capital formation.

Thanks to persistent current account and capital account surpluses for two decades China has accumulated $3.2 trillion in foreign exchange reserves. But, as a country with huge net foreign assets, China runs a deficit on the investment income account. Since 2008, China’s current account surplus as a proportion of GDP has fallen significantly. But China is still running twin surpluses, and there is a lingering question about whether the fall is structural or cyclical.

Indeed, China needs to accelerate its economic adjustment, even at the expense of growth. Otherwise, it will have to pay an even higher adjustment cost later.

For many years, the government has maintained an implicit minimum annual growth target of 8 percent, which was considered necessary to create 10 million new jobs annually. But demographic and other structural changes may have altered labor market conditions; so far, despite below 8 percent growth, there seem to be few signs of distress.

The question now is whether the government will be unnerved by the poorest quarterly growth performance in three years and usher in a large stimulus package, with the consequences that China has experienced whenever such a package is implemented.

Wen said recently that China “should continue to implement a proactive fiscal policy and a prudent monetary policy, while giving more priority to maintaining growth”. Moreover, in recent months, the government has approved some large steel and energy projects, and more such approvals may come.

It is certainly appropriate for a government to respond to changing circumstances in a timely fashion. But the slowdown to 7.8 percent annual growth in the first half of 2012 does not warrant a change of policy direction.

China must choose between higher growth and faster structural adjustment. It cannot have both at the same time. Faced with the current slowdown, China can afford to stay on course, at least for the time being.

By: Yu Yongding, President of the China Society of World Economics, is a former member of the monetary policy committee of the People’s Bank of China

US Economy Watch:  Going bankrupt becomes last resort for some US cities

Going bankrupt is the last resort for some local governments in the United States to protect them from being shut down.

San Bernardino, near Los Angeles, filed for bankruptcy protection last Wednesday. It is the 3rd city in California to seek relief from its creditors in less than 5 weeks.

In late June, Stockton, an agricultural community east of San Francisco, became the largest city in the US to file for bankruptcy protection as it grappled with the aftermath of the housing bubble and high public-pension costs.

In early July, Mammoth Lakes, a ski destination, filed for bankruptcy protection after it lost a lawsuit in a soured real-estate deal.

Nationwide, Central Falls in Rhode Island, Jefferson County in Alabama both filed for bankruptcy in Y 2011. Harrisburg in Pennsylvania and Boise County in Idaho also filed for bankruptcy, but their claims were rejected.

The majority of Chapter 9 bankruptcy filings have been submitted by utility authorities, special districts and other taxing entities. In Omaha, Nebraska eight sanitary and improvement districts have filed for bankruptcy since Y 2010.

According to www.govering.com, a website that tracks bankruptcy filings in the US, there have been 27 municipal bankruptcy filings and seven city and locality bankruptcy filings since Y 2010.

Bankruptcy has become a way for local governments that have been in financial crisis to tide over. Take San Bernardino for example, the city with a population of 210,000, is facing financial difficulties with an expected deficit of US$45-M this fiscal year.

The city announced that the bankruptcy filing would not affect services in the city. The filing follows a city council vote to declare a state of fiscal emergency 2 wks ago.

California’s pension-related costs rose 20-fold since Y 1999. Many US cities have been dragged into financial crisis because of the issue.

A recent Pew research survey found that the gap between state assets and their obligations for public sector retirement benefits is US$1.38-T. It rose by 9% in Y 2010 alone, and it will likely keep rising until these obligations are renegotiated.

Once the restructure of the finances is over, the city can get out of bankruptcy and operate in normally.

In Y 1994 Orange County in California filed for bankruptcy protection. It was the largest municipal bankruptcy in US history at that time.

After filing for Chapter 9 protection, Orange County successfully sued its financial advisers, collecting US$600-M in settlements and jury verdicts and finally completed its financial restructure.

Economists see a Romney Presidency adding 12-M new jobs in US

Several economists say that a Mitt Romney Presidency can add 12-M jobs to the economy in the 4 yrs after he is elected.

Below is CNN Money’s summary of the paper that supports the plans to reboot the US jobs market:

According to the position paper, the quick turnaround would be spurred by the lower tax rates and drastic spending cuts that are the hallmark of Mitt Romney’s plan.

The plan goes on in great detail to show how tax rate changes would drive a new level of economic activity and spending cuts would resurrect the private sector. What the analysis fails to show is how government spending cuts can be matched with the stimulus so many economists believe the country needs, even though experts say such plans would drive up the deficit. That sort of increase is against all of Romney’s principles.

Thoughts that taxes are regressive is at the heart of Mitt Romney’s plan.

Capital freed up will go toward consumer spending. Many people and businesses in the United States would like to rebuild their “balance sheets” and pay down large debt loads and rebuild savings as a large part of the population moves toward retirement.

Some experts say that the idea that the US economy  could add 12-M jobs just 4 yrs is a big assumption, as in periods of American history when GDP growth was at historically high levels, that rapid job creation was rare.

Six million new jobs in the US in 4 yrs would be impressive. The Obama presidency did not approach that mark.

                      At the Movies with Monica Petrucci from Tinsel Town

                      Box Office Report: “Dark Knight Rises” high over “Total Recall”

                                       “Ted” over $200-M mark in North America

The Superhero pic earns $36.4-M in its 3rd weekend, Sony’s “Total Recall” remake took in $26-M on the open; Fox’s “Diary of a Wimpy Kid: Dog Days” # 3 with $14.7-M.

New family player Diary of a Wimpy Kid: Dog Days also came in on the low end of expectations in opening to $14.7-M. However, the film cost a modest $22-M to produce, so it is on solid ground financially already.

Heading into the weekend, Sony projected a domestic opening in the $25 to 30-M range for Total Recall, the original 1990 film took in $25.5-M. The remake cost at least $125-M to produce.

Total Recall, directed by Len Wiseman and staring Colin Farrell in the role made famous by Arnold Schwarzenegger is counting on a strong international run to boost its bottom line and opened in 10 Asian markets this weekend, earning $6.2-M. Kate Beckinsale and Jessica Biel also star.

The movie played best to older moviegoers in North America. Males made up 58% of the audience, while ticket holders over the age of 30 made up 53%.

Neither critics nor moviegoers were wowed by the remake, based both on Paul Verhoeven’s 1990 film and the short story by Philip K. Dick. The film drew generally poor reviews and earned a C+ CinemaScore from the audience.

Fox’s Wimpy Kid 3 is the first film in the family franchise to open in Summer. The previous 2 installments debuted in March, each opening north of $22-M.

Chris Aronson, president of domestic distribution for Fox, said Wimpy Kid 3 will make up the difference during the week, considering that kids are still out of school.

Wimpy Kid 3 earned an A- CinemaScore, the same grade the 1st 2 films earned.

Dark Knight Rises, from Warner Bros. and Legendary Pictures, fell only 41% in its 3rd weekend and has now grossed $354.6-M domestically. The movie continues to trail The Dark Knight, it took in $393-M in the same frame.

Imax theaters continue to see big grosses for Dark Knight Rises, generating $5.6-M in tickets sales over the weekend for a take of $48-M.

Director Seth MacFarlane’s R-rated comedy Ted jumped the $200-M mark at the domestic box office this weekend in addition to scoring stellar numbers in key foreign markets.

The film from Universal and Media Rights Capital, Ted has now earned $203.4-M in North America and will soon eclipse Wedding Crashers, $209.3-M to become the # 4 R-rated comedy of all time behind The Hangover, $277.3-M, The Hangover Part II $254.8-M and Beverly Hills Cop at $234.5-M.

Ted starring Mark Wahlberg and Mila Kunis, along with the MacFarlance-voiced Teddy Bear is rolling out slowly in overseas markets over the weekend for an early international total of $77.3-M.

The pic’s international weekend gross was $32-M from 20 markets, including 1st-place finishes in the UK, Germany, Russia, Austria Switzerland and Ukraine.

Ted will roll out in an additional 38 territories over the next few months.

Have some fun, see a movie this week.

All the best,

Monica Petrucci

_________________________________________________________________________________

                            US Major Markets Support and Resistance

DJIA close: 13,096.17

Resistance

13,297 the Apr 2012 high

13,668 from the Dec 2007 high

13,692 from Jun 2007 high

14,022 from the July 2007 high

Support

13,058 from the May 2008 high

13,056 the Feb 2012 high

The 50-Day EMA: 12,785

12,754 the Jul 2012 intra-day high

12,716 the Apr 2012 closing low

The 200-Day SMA: 12,584

12,391 the Feb 2011 high

12,369 a low from May 2012

12,284 the Oct 2011 high

12,258 the Dec 2011 high

S&P 500 close: 1390.99

Resistance

1406 the early May 2012 high

1422 the Mar 2012 high

1425 from May 2008 closing highs

1433 from the Aug 2007 closing lows

1440 from the Nov 2007 closing lows

Support

1378 the Feb 2012 high

1375 the early Jul 2012 high

1371 the May 2011 high

1363 the Jun 2012 high

1359 the Apr 2012 low

1357 the July 2011 high

The 50-Day EMA: 1354

1344 the Feb 2011 high

1340 the early Apr 2011 high

1332 the early Mar 2011 high

1325 the Jul 2012 intra-day low

The 200-Day SMA: 1322

1309 a low from Jun 2012

1295 the Apr 2011 low

1293 the Oct 2011 high

NAS close: 2967.90

Resistance

2988 the Jul 2012 high

3000 the Feb 2012 high

3026 from the Oct 2000 low

3042 from the May 2000 low

3076 the late Apr 2012 high

3090 the mid-March 2012 interim high

3134 the Mar 2012 high

3227 the Apr 2000 intra-day low

3401 the May 2000 closing low

Support

2962 the Apr 2012 low

2942 a Jun 2012 high

2910 the Mar 2012 low

The 50-Day EMA: 2909

2900 the Mar 2012 low

2888 the May 2011 high

2879 the Jul 2011 high

2866 the Jul 2012 closing low

2862 the Y 2007 high

2841 the Feb 2011 peak

The 200-Day SMA: 2840

2816 the early Apr 2011 high.

2754 the Oct 2011 high

____________________________________________________________________         

                                           US Market Sentiment

Sentiment Indicators

Watching the VIX: The VIX gapped sharply lower on Friday bringing it below a level where the S&P500 peaked in late April, sold off in the run down to the June low that triggered this rally.

This is a very important mark, as S&P 500 breaks to a new rally high, it is now the 5th higher high on this move as it approached 1400-1415 mark that I said last week is the target for this non Fed stimuli move.

The VIX is at the level in late April where the market topped, sold off and VIX rallied. This is a interesting mark to watch. The market can continue to rally from here.

The VIX could continue lower, down to its March levels, in the 15 Zone (near a 5 yr low). If it does that, the market can rally right up probably to 1415 or maybe even the prior high, from there without anything from the US Fed, it could get very toppy IMO.

VIX: 15.64; -1.93

VXN: 17.46; -1.62

VXO: 14.77; -2.08

Put/Call Ratio (CBOE): 0.83; -0.1

Bulls vs. Bears

The Bulls are at 39.4% vs. 40.4% last. As the market continues marking higher lows and higher highs (good technical action), the Bulls are slowly fading. As is often the case just as the market turn some investors turn Bearish in a volatile market.

For your reference: 35% is the mark that suggests Bullishness, and to be really Bearish it needs to get up to the 60-65% mark.

The Bears are at 27.7% vs. 26.6% last. The Bears are rising as the Bulls fade some, and gaining strength from the volatility even as the S&P500 trends higher. There is a long way to go before Bearishness gets Bullish for the market (35% is the mark), it is rising even as the market rises, a good contrary indication.

For your reference: Bearishness hit a 5 yr high at 54.4% the last week of October 2008. The move over 50 took bearish sentiment to its highest level since Y 1995, extreme negative sentiment or sure..

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 & Poor’s 500 Index (SPX) bid/ask quotes. It was created in 19**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.

            Focus on Precious Metals and Energy

Charts by:eSignal.com

The Overall Fundamentals

Precious Metals

Gold’s price continued to fluctuate around the 1600 mark, with disappointments of the US Fed and the ECB being the major drivers of the decline.

Gold was the only metal in the complex that recorded weekly fall last week. But, I do expect the up-trend to continue.

Energy

Friday’s rally has saved Crude Oil prices from recording losses for a 2nd week running. Concerning front-month contracts, WTI Crude Oil gained +1.41%, Brent Crude finished +2.32%.

After a brief fall to Contango in June, ICE Brent Crude returned to backwardation in July and the spread has been widening in recent days. The Key reasons for the situation are sanctions on Iran and potential decline in supply of Forties (the available barrels of North Sea Forties blend Crude Oil, the largest component of benchmark Brent Crude as a result of an export program in September).

Strength in Crude Oil prices was helped by the US’ and its allies’ sanctions on Iran’s oil exports, the data shows that Iran’s shipment has dropped -1.2M BPD since the EU sanctions became effective on 1 July. This represents about 50% of the original output of the Middle East country.

In coming months, the situation will likely tighten as the US intensified sanctions by penalizing foreign banks that handle transactions for National Iranian Oil Company (NIOC) or its subsidiary Naftiran Intertrade Company.

The US has now placed sanctions on China’s Bank of Kunlun and Iraq’s Elaf Islamic Bank.

Note: the Bank of Kunlun is a regional bank in western Xinjiang province with 82% held by CNPC, this round of sanctions would further limit China’s ability to buy Crude Oil from Iran.

The Brent Crude contract is based on 4 North Sea Crude Oils – Brent, Forties, Oseberg and Ekofisk.

While Forties is the largest stream and the most important Crude Oil for setting prices, its supply is expected to decline as Nexen (NYSE:PB) has planned to close Buzzard for maintenance, the largest field with over 70% Crude Oil feed to Forties

Nymex Nat Gas price fell on Thursday due to the broad-based selloff in financial markets after the ECB’s disappointment.

The decline was also driven by the increase in supply of +28 bcf to 3 217 bcf in the US in the week ended 27 July.

Stocks were +472 bcf higher than last year at this time and +407 bcf above the 5-year average of 2 810 bcf.

While Nat Gas price will likely report losses for the 2nd consecutive week, it has risen more than +50% from the lowest point in April. That is attributable to the rally for 2 Key reasons: Coal-to-Gas replacement and hot weather.

In Q-1 of Y 2012, market fears that oversupply in Nat Gas would fill storage earlier than usual sent prices South.

As a result, Nymex Nat Gas price plummeted to a 10 yr low in April. Selloff in Nat Gas prices has attracted demand from power generators with the power sector chose to run Nat Gas-fired plants instead of Coal-burning ones due to lower costs. This kind of demand for Nat Gas is highly dependent on low Nat Gas prices. Already some plants have already switched back to Coal with recent rally in Nat Gas prices.

Power consumption has also been support by hotter-than-normal weather in the US this Summer. This factor will continue to help in August and as long as the weather is “Hot enough”, robust demand would sustain current price levels. However, as Winter comes, I believe price will falter and probably slip back to $2.00 range.

The Overall Technicals

Comex Gold (GC)

Gold failed to hold above 1625.7, the resistance, and subsequent break of 1600.8 minor support indicates that recent sideway trading from 1526.7 is still in on.

On the Downside: a break below 1562 favors a Southside breakout to below 1526.7. But, strong support should be seen around 1500, the psych mark to contain any downside. And , a break of 1628 will be another sign of Northside breakout and break of 1642.4 should send Gold through 1700, the overhead psych mark.

The Big Picture: price actions from 1923.7, the high are viewed as a medium term consolidation pattern. There is no indication that this consolidation is finished, and more range trading could be seen. The downside of any falling leg should be contained by 1478.3/1577.4 Support Zone and bring on a rebound, and a break of 1792.7, the Key resistance, is needed to be the 1st signal of up-trend resumption. Barring that, the consolidation will extend.

The Long Term Picture: with 1478.3, the Key support intact, there is no change in the long term Bullish outlook for Gold, but , some more medium term consolidation cannot be ruled out, and I anticipate an eventual break of 2000, the psych mark, in the long run. Stay tuned…

Comex Gold Continuous Contract Daily Chart

Comex Silver (SI)

Silver’s sideway trading continued last week and it has not found a commitment for a breakout yet, and more consolidative trading could be seen in near term.

On the Downside: a clear break of 26.07 confirms resumption of whole decline from 37.48, and should target next long term fibo mark at 24.22.

On the Upside: a break above 28.445 will bring on another rally to 29.856, the Key resistance, instead.

The Big Picture: Silver price actions from 26.15 should only be a consolidation pattern. In here I am slightly favoring the case that such consolidation finished at 37.48. And, fall from 37.48 should extend to 61.8% fibo retracement of 8.4 to 49.82 at 24.22 and below. But, a break of 29.856 suggests 1 more rising leg before consolidation from 26.15 finishes.

The Long Term Picture: the Big Q remains on whether 49.82 is a medium term or long term top, this current development favors the latter. I prefer to see sustained break of 61.8% fibo retracement of 8.4 to 49.82 and then fall to 24.22 to confirm. Barring that, the price actions from 49.82 may just be developing into a sideway pattern. Stay tuned…

Comex Silver Continuous Contract Daily Chart

Nymex Crude Oil (CL)

Crude Oil rebounded late last week, but upside is still limited to below 92.94, the short term top.

Initial bias remains Neutral and more consolidation cannot be ruled out. But, even in case of another decline, near term outlook remains Bullish as long as 83.65 support holds. As I noted before, the decline from 110.55 should have finished at 77.28. This rebound should extend and break of 92.94 will target 61.8% fibo retracement at 97.84 and above.

The Big Picture: the price actions from 114.84 are viewed as a 3 wave consolidation pattern with the fall from 110.55 as the 3rd leg. Such a decline may have finished earlier than we expected at 77.28. Sustained trading above 90, the psych mark, will bring stronger rally towards 114.83, the Key resistance. And a break there will resumption whole up-trend from 33.2.

On the Downside: another fall cannot be ruled out, but even in that case, strong support should be seen below 74.95 and above 61.8% fibo retracement of 33.20, and bring another medium term rise.

The Long Term Picture: Crude Oil is in a long term consolidation pattern from 147.27, with 1st wave completed at 33.2. The corrective structure of the rise from 33.2 indicates that it is the 2nd wave of the consolidation pattern. While it could make another high above 114.83, I anticipate strong resistance ahead of 147.24 to bring reversal for the 3rd leg of the consolidation pattern. Stay tuned…

Nymex Crude Oil Continuous Contract Daily Chart

____________________________________________________________________________________

                    Red’s Weekly Technical Report on the EUR-USD pair

EUR-USD is in the process of recovering after Thursday’s spike South forming an ABC correction and reached the lower boundary of the consolidation zone which will probably resist and push the pair back down again.

If it breaks below the 1.2165 lows that will probably re-establish the down-trend and target 1.2060.

If it breaks back into the range and moves above the Key 1.2257 mark then I see 1.2330 reached next, but further gains are capped by a major trend-line. Stay tuned…

____________________________________________________________________________________

                                               The LTN Hot List

The LTN “Hot List” contains potential investment opportunities suitable small, mini and micro cap portfolios.

American Estates Management Company (PK: AEMC) provides mining and mineral processing engineering services; geological and environmental services; marketing, project development, project management, and mineral resource management services. American Estates Management Company markets mineral and metal products and equity in mineral and metal projects, and partners in the development of mineral assets and metal production facilities. American Estates Management Company has developed business activity in North America, South America and Asia.

Marketing Mineral Real Estate & Mineral Resources
Mineral Lease & Mineral Resource Sale Negotiation
Mineral Lease Management
Monitor Exploration & Mining Activity
Verify Royalty Payments
Develop Real Estate & Mineral Resource Databases, Estimates & Maps
Valuation of Mineral Real Estate & Mineral Resources

www.americanestatesmanagement.com

http://www.livetradingnews.com/the-hot-list-aemc-siri-avp-jag-72354.htm#.T6cH7Ov3K8A

Trai Thien USA Inc (PINK: TRTH)

Trai Thien USA is a fast-growing Vietnam-based dry bulk shipping company operating a 21,990 DWT fleet comprised of six geared bulk vessels specializing in providing ocean transportation services for raw material input items such as coal, ore, grain, lumber, cement, steel and fertilizer throughout the Southeast Asia region.

After China, the primary sources of future bulk demand are India, Brazil and Vietnam. The region contains three of the four global BRICs (Brazil, Russia, India, China), seen by economists as the future growth leaders in the world economy.

The Asia Pacific region accounts for 60% of the world’s population and almost 70% of world sea-borne trade in bulk commodities.

In order to meet anticipated continued growth in demand from an expanding base of overseas and domestic Vietnamese customers, as well as to expand the geographic regions that it can service to include potentially more profitable routes in East and South Asia.

The Company’s Vietnam-based operations are located in Ho Chi Minh City, which together with the surrounding areas, accounts for more than seventy percent of Vietnam’s total annual cargo traffic.

Pink Sheets: TRTH

Current Price: 0.79

Current PE: 4.0

Revenue Growth: 148%

1 yr Target Price: 3.40

Analysts Rating: Strong Buy

http://www.traithienusa.com   

Red’s Bull Trade Alerts and Option’s Alerts are suitable for Big Cap portfolios

This week’s Options Trade Alerts: eBay (NASDAQ:EBAY), Cognizant Technology Solutions Corporation (NASDAQ:CTSH)

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

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

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