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Paul Ebeling on Wall Street

September historically is the worst month for the US stock market. This September the market is on a run North so far thanks to the US Fed and the ECB’s actions last week.

Again this week we have economic data, but the Fed is out with theirs already, and earnings season is not here yet, so what will be influencing the market this week…the Vix?

The VIX being where it is and trying to bounce may be the catalyst for a pullback of 3, 4 or 5 days before buyers move in again.

On the other hand stocks could come out strong again Monday, as participants play catch up into the end of the year.

We know that lot of fund managers have been were very negative about this market. And as we all know we can have feelings but we cannot let them get in the way of what the market is doing. It is always good to be on edge but never make assumptions, the market is like a moving train, ride it to win, stand in front of it and it is a known killer.

When the signals start to flash buy and sell that’s what to do. Be ready, be nimble is the Key, and when the train is moving jump aboard North or South.

Just now the market need a pullback and a test as the VIX could be signaling.

There are good stocks to buy, they are extended, and when they come back some, the entry points are better.

Put emotions aside, know what a good buy is, and know the stocks you want to buy, when they set up buy them.

I put US analysis on good stocks daily on www.livetradingnews.com

Right now the US Fed has a bid in the market, so it is now a buy the dip scenario. The Fed is there, and so it is very likely that the big money managers will be coming in and drive stocks higher into end of the year.

Meanwhile, ignore the news overload and do your own work.

Options Trade Alert: Vanguard MSCI Emerging Markets ETF (NYSEARCA: VWO)

See them daily at www.livetradingnews.com

September historically is the worst month for the US stock market. This September the market is on a run North so far thanks to the US Fed and the ECB’s actions last week.

Again this week we have economic data, but the Fed is out with theirs already, and earnings season is not here yet, so what will be influencing the market this week…the Vix?

The VIX being where it is and trying to bounce may be the catalyst for a pullback of 3, 4 or 5 days before buyers move in again.

On the other hand stocks could come out strong again Monday, as participants play catch up into the end of the year.

We know that lot of fund managers have been were very negative about this market. And as we all know we can have feelings but we cannot let them get in the way of what the market is doing. It is always good to be on edge but never make assumptions, the market is like a moving train, ride it to win, stand in front of it and it is a known killer.

When the signals start to flash buy and sell that’s what to do. Be ready, be nimble is the Key, and when the train is moving jump aboard North or South.

Just now the market needs a pullback and a test as the VIX could be signaling.

There are good stocks to buy, they are extended, and when they come back some, the entry points are better.

Put emotions aside, know what a good buy is, and know the stocks you want to buy, when they set up buy them.

I put us analysis on good stocks daily on www.livetradingnews.com

Right now the US Fed has a bid in the market, so it is now a buy the dip scenario. The Fed is there, and so it is very likely that the big money managers will be coming in and drive stocks higher into end of the year.

          US Major Market Indexes Technical Analysis

Meanwhile, ignore the news overload and do your own work.

.In my Bull Trade Alert column at www.livetradingnews.com I post the Strong Buys and Buys (Long) daily, I do not post Short plays as I believe that it is hard and dangerous to play them in here.

Have a terrific week.

All the best,

                 Re-cap of the US Markets for the Week ended 14 September 2012        

US Stocks: Wall Street finishes the week higher

Friday’s session started on a positive note as stocks appeared poised for a follow through day of broad post-FOMC gains.

The NAS outperformed as it held the bulk of its gains throughout the day.

Afternoon selling pressure increased slightly after Egan Jones lowered the credit rating of the US from ‘AA’ to ‘AA-.‘

Looking at the major indices: the NAS led the charge with a 0.9% gainer, the DJIA and S&P 500 each added 0.4%.

DJIA 13598.55+53.51 (0.40%)

NAS 3183.95+28.12 (0.89%)

S&P 5001465.77+5.78 (0.40%)

10-yr T-Note-1 9/32 1.867

NYSE Adv 2104 Dec 94 8Vol 899.8-M

NAS Adv 1616Dec 84 8Vol 1.94-B

Industry Watch

Strong: Financials, Energy, Materials, Technology

Weak: Health Care, Telecom, Utilities, Consumer Staples

Financial stocks continued to rally after Thursday’s news.

The SPDR Financial Select Sector ETF (XLF) 16.28, +0.13 closed higher by 0.8% as most major issues rose. The ETF has seen a 4.0% rally since the US Fed’s announcement.

Bank of America (NYSE:BAC) 9.55, +0.15, Morgan Stanley (NYSE:MS) 18.24, +0.34, and Wells Fargo (NYSE:WFC) 36.13, +0.58 all posted gains near 1.5%.

European financials were also in focus as monetary easing in the US carries global implications.

Barclays (NYSE:BCS) 14.81, +0.46, Deutsche Bank (NYSE:DB) 44.28, +1.41, and UBS (NYSE:UBS) 13.48, +0.46 all gained near 3.5%.

Stocks in the defensive telecom space were lower as the sector underperformed the broader market.

Verizon (NYSE:VZ) 44.53, -1.05) and AT&T (NYSE:T) 37.26, -0.89 both slid near 2.3%. The 2 telecom giants saw relative weakness after Stifel Nicolaus downgraded both stocks from ‘buy’ to ‘hold.’ With the majority of the sector sliding, Sprint (NYSE:S) 5.26, +0.06) and MetroPCS (NYSE:PCS) 10.63, +0.15 were able to resist the trend and post respective gains of 1.2% and 1.4%.

AK Steel (NYSE:AKS) 5.87, -0.57 fell 8.9% after lowering its Q-3 guidance on expectations of a 7% quarterly decrease in the price of steel. Following the announcement, AK Steel was downgraded by Credit Agricole. Other steel makers continued to rally along with producers of basic materials. Steel Dynamics (NASDAQ:STLD) 13.01, +0.61) added 4.9%, while Cliffs Natural Resources (NYSE:CLF) 45.55, +2.37 rose 5.5%.

Office supply retailer OfficeMax (NYSE:OMX) 8.15, +1.04 rose 14.6%. Earlier, the company confirmed it would extinguish a non-recourse liability which is related to Lehman-backed timber notes. Because of this, OMX will recognize non-cash, pre-tax gain of $671.1-M in Q-3. Today’s buying lifted the stock to a 21.2% gain on the week. Staples (NASDAQ:SPLS) 12.21, +0.25 rose 2.1% following recent rumors of a possible private equity buyout.

Western Digital (NYSE:WDC) 41.06, -1.51 fell 3.6% after lowering its revenue guidance for F-Q-1. Shares of the hard drive producer have been in a downtrend since the stock reached a 2-yr high at $45.48 on 17 August.

Social media stocks were on the rise.

Facebook (NASDAQ:FB) 21.95, +1.24 is up 6.0% following reports which suggest the company is set to introduce a real-time ad program.

FB’s peer Zynga (NASDAQ:ZNGA) 3.23, +0.27 is + 9.1% after the company hired an online-gambling executive, Maytal Olsha as its new Chief Operating Officer.

Groupon (NASSDAQ:GRPN 5.16, +0.40 is higher by 8.4% as the stock of the online deals site rebounds after reaching an all-time low of $4.00 on 4 September.
A lot of economic data was out Friday.

Consumer prices increased by 0.6% during August, which was in-line with the 0.6% gainer that had been generally expected. Core prices increased by 0.1%, which was slightly short of the 0.2% increase expected by economists.

Retail sales rose during August by 0.9%, which was better than the 0.7% increase that had been expected. The prior month’s reading was revised down to show an increase of 0.6%. Excluding autos, retail sales rose by 0.8%, which was in-line with the consensus call.

Industrial production decreased during August by 1.2%, which was worse than the 0.2% decrease that had been widely expected. The reading followed the revised 0.5% increase experienced in the prior month. Capacity utilization hit 78.2%, which was worse than the 79.2% that had been expected and down from the revised prior month reading of 79.2%.

The preliminary University of Michigan Survey for September came in at 79.2, which was ahead of the prior month’s 74.3, and better than the reading of 73.5 that had been widely expected.

Lastly, monthly business inventory data for July showed an inventory build of 0.8% for the month which was slightly above the 0.4% that had been expected.       

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Red’s Options Trade Alert: Vanguard MSCI Emerging Markets ETF (NYSEARCA: VWO)

Vanguard MSCI Emerging Markets ETF options set a new 90-day record for the number of contracts that exchanged hands between the buyers and the sellers on both the Call and Put side last Friday.

P/C Volume: Puts was 5,553 and Calls were 3,008 equating to a 1.85 Put/Call Ratio (PCR).

Investors use options to manage risk and to speculate on price changes. Options can provide significant leverage if the stock moves in the right direction but also end up worthless if it does not.

A low PCR signals Bullish sentiment, and a high PCR signals Bearish sentiment.

Profile: The investment seeks to track the performance of the MSCI Emerging Markets index. The fund employs a passively managed investment approach by investing all or substantially all of assets in a representative sample of the common stocks included in the MSCI Emerging Markets index. This index includes approximately 748 common stocks of companies located in emerging markets around the world
Vanguard MSCI Emerging Markets ETF opened at 43.16 and the stock price rose 0.52 (+1.22%) to 43.22 during Friday’s market session.

VWO traded in the range of 43.07 – 43.69 Friday.

Performance indicators show that the stock has gained 3.46% within the last month.

Share Volume: 28-M shares is higher than the 3 month average volume of 21-M shares.

VWO is trading above its 20, 50 and 200-Day Moving Average.

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

17 September – Monday

Empire Manufacturing, September (8:30): -3.0 expected, -5.9 past

18 September – Tuesday

Current Account Balance, Q-2 (8:30): -$125.6-B expected, -$137.3-B past

Net Long-Term TIC Fl, July (9:00): $9.3-B past

NAHB Housing Market, September (10:00): 38 expected, 37 past

19 September – Wednesday

MBA Mortgage Index, 09/15 (7:00): 11.1% past

Housing Starts, August (8:30): 772-K expected, 746-K past

Building Permits, August (8:30): 800-K expected, 812-K past

Existing Home Sales, August (10:00): 4.58-M expected, 4.47-M past

Crude Oil Inventories, 09/15 (10:30): 1.994-M past

20 September – Thursday

Initial Jobs Claims, 09/15 (8:30): 375-K expected, 382-K past

Continuing Claims, 09/8 (8:30): 3292-K expected, 3283-K past

Philadelphia Fed, September (10:00): -5.0 expected, -7.1 past

Leading Indicators, August (10:00): 0.0% expected, 0.4% past

21 September- Friday

None                                          

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This Week on the Earnings Front in the USA

There are no market movers reported earnings this week.

For the complete list go to: http://biz.yahoo.com/research/earncal/20120917.html

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                                   The Most Asked Question last Week

The Big Q: Red’s will the US Fed’s Big Stimulus fuel a housing recovery and boom?

The Big A: No, Stocks, not housing, seen as Fed’s Big Stimulus winners IMO.

The Federal Reserve’s new economic stimulus plan involves printing huge sums of money to help people buy homes, but over the next year the program will likely do more to boost the economy by lifting stock prices.

The Fed said last week it would buy $40-B every month in mortgage backed securities until the labor market improves substantially. The program will likely lower interest rates for mortgages and also help some folks refinance their home loans.

The Fed’s open-ended buying program represents an unprecedented bid to get the US economy growing more quickly, and many economists believe it will have a strong impact on housing market which is being constrained by tight lending policies at banks; mortgage rates are at record lows.

However, it is possible this stimulus will help the economy in other, more powerful ways.

By giving an open-ended commitment to flood money into the market for mortgage-backed securities, the Fed will likely keep supporting stocks and other asset classes by keeping returns low on MBS (mortgage backed securities).

That means that investors in search of yield will have more reason to buy equities and to lend money to companies.

The Fed’s bond buying program will add at least a 0.05 to the US GDP over the next year by boosting stock prices and making people feel wealthier. The main transmission mechanism is through the stock market.

The theory is that people will spend an extra few pennies for every USD of wealth they gain, because so many people have retirement funds connected to the stock market, a boost in share prices will lead people to spend more money.

US Fed Chairman Ben Bernanke said Thursday policymakers hope its new program will help people buy homes, but he acknowledged the aim is also to boost asset prices like stocks and to make families and businesses more confident in the future of the economy.

“If people feel that their financial situation is better … they are more willing to spend,” he said.

US stocks rose more than 1.5% Thursday after the Fed unveiled the new bond buying program, and closed last week near 5 yr highs.

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 this Week: “Our willingness to fail gives us the ability and opportunity to succeed where others may fear to tread.” -John Gelwicks, Chairman/President eGen Industries.

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                                                 Hot Topics

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

In View:  Investors buying “Junk”

Not so long ago, as recently as mid-Y 2007 in fact, investors could earn more than 5% on ultra-safe US Treasury bonds. Today, they have to venture into Junk-bond territory to find a similar yield, and plenty of people are taking that path.

Mutual funds investing in high-yield bonds, the polite name for Junk have taken in nearly $50-B of new cash so far this year. That has pushed yields to record low levels, which has caused some analysts to declare that the Junk-bond bubble is inflating.

In the bond world, all rates are relative. The average Junk bond yield, according to the Barclays High Yield Index, is 6.65%, which is 5% more than the yield on a 10-yr US T-Note.

That spread compensates investors for the extra risk they take in lending to a company like Charter Communications (NASDAQ:CHTR) which emerged from bankruptcy less than 3 yrs ago. Charter issued new 10-yr bonds this Summer that pay 5.25%, replacing older debt that carried double-digit interest rates.

Charter was part of a refinancing wave that has pushed Junk-bond issuance to $200-B so far this year, which is on track to break a record set in Y 2010.

The Big Q is: are investors in junk-bond mutual funds stretching a little too hard to find a 5 or 6% yield?

The problem is this, investors often confuse yield and return, as it is not the level of rates that matters, but how these things correlate with other assets in an investor’s portfolio.

When stocks and other risky assets are crashing, Junk bonds tend to crash, too. Therefore, they have little diversification value.

It’s a big concern, then, when Junk bonds become the mutual fund flavor of the month. The investors chasing 6% yields today are some of the same people who vowed to take less risk after the crash of Y 2008.

Some bond-market pros are less worried. “I wouldn’t call it a Junk-bond bubble any more than you could call all fixed-income securities a little stretched right now,” says a chief fixed income strategist at Wells Fargo Advisors (NYSE:WFC). He says the spread between Junk and Treasury rates is only slightly below its long-term average.

The value is close to fair value,” he says. “It is not a cheap asset class by any means, but it does not look overly expensive either.”

In today’s market, he says, he’d rather see someone stretch for yield by buying a junk bond than by reaching for longer maturities, like a 30-year T-Bond. Thirty years is too long to lock in today’s unusually low rates, he says, and junk bonds typically have maturities of 10 yrs or less.

Unless you’re an aggressive risk-taker, it’s best to avoid high-yield Junk bonds, the category’s nickname is lighthearted enough when things are going well, but in the next downturn, investors will remember that they call it Junk for a reason.

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Eurozone Watch: Deep divisions among EU ministers on setting up banking union

Deep divisions emerged Saturday among European Union (EU) Finance Ministers wrapping up a 2-day informal meeting in Cyprus on a proposal to set up a Banking Union and establish a common mechanism to oversee bank operations in Eurozone member states.

The Banking Union proposal was put forward by Internal Market and Services Commissioner Michel Barnier as a first step to allow the proposed European Stability Mechanism (ESM) to directly provide financial assistance to banks.

Barnier said he expected there would be disagreements on the proposal.

Germany voiced sharp disagreement with the proposal on the grounds that it was too ambitious and could not be materialized by the end of the year.

German Finance Minister Wolfgang Schaeuble also said that handing bank control to the European Central Bank (ECB) would not be in itself sufficient for banks to directly draw money from the ESM.

He insisted that countries which have banks in trouble and wishing to draw money from the ESM must still apply for an adjustment program though the ESM.

“I don’t see that there can be direct recapitalization through the European Stability Mechanism ready by 1 January,” he said.

The ESM is expected to be launched at a meeting on 8 October and be operational within a month, with an initial capacity to hand out up to 200-B Euros (US$262-B) before this sum is increased to 500-B Euros.

Mr. Shaeuble’s remarks conflicted with statements by French Finance Minister Pierre Moscovici, who pointed out that Eurozone leaders have agreed to reach a deal on the Banking Union within this year and this had to be respected.

However, Mr. Moscovisi said he did not consider the differences insurmountable and expressed confidence that a deal will be clinched before the end of the year.

“It is natural to have differences on different issues as we have agreement on others … Both France and Germany know that if they do not reach an agreement then there can be no agreement, something which makes them try their utmost to find common ground … I am convinced that we will get there before the end of 2012, both because it is our duty and we have to possibility to do so,” Mr. Moscovisi said.

Establishing a Banking Union would involve monitoring Eurozone banks by the ECB, establishing a fund to close down banks in trouble and a scheme to protect depositors’ money.

Barnier said the European Commission expects that the proposal for a common mechanism to control Eurozone banks could be implemented in steps starting in January 2013.

“I know the time frame is ambitious but it is a realistic one, because time is pressing and the issues are complex,” he told reporters at a joint press conference with Cypriot Finance Minister Vassos Shiarly.

Mr. Shiarly, who currently presides EU Finance Ministers meetings, said he would make every effort to set up a Banking Union as soon as possible.

The ECOFIN meeting ended on an upbeat tone on the prospects of at least one of the troubled Eurozone countries. It said in a statement that it expected Portugal to return to the markets within Y 2013 as its adjustment program is considered to be on the right track.

Portugal was one of the 5 Eurozone countries which applied for EU bailout, the others being Spain, Greece, Ireland and Cyprus.

ECOFIN said it expected Portugal’s deficit to be below 3% at the end of Y 2014 and its sovereign debt at a sustainable level of under 124% of its GDP.

A revision of Portugal’s bailout package and a release of the next tranche of EU funds are expected to be decided at the next ECOFIN meeting.

ASEAN Watch: Indonesia expects weaker USD after new US’ Big Stimulus

Bank Indonesia (BI), Indonesian Central Bank, said that it expects the weakening value of the USD following the decision of the US Federal Reserve, to inject a monetary stimulus to spur growth and push down unemployment rates in the world’s largest economy, local media reported Saturday.

“Overall, the liquidity of the dollar in the global market will increase. Such pressure will weaken the USD, albeit slightly,” BI Governor Darmin Nasution said Friday.

A 2 day meeting of the Fed’s board of governors concluded on Thursday (Friday, Jakarta time) that the US would implement another round of quantitative easing, a monetary stimulus in which the US central bank will inject more money into the market by buying mortgage-backed securities, for a third time after it implemented the same policy in Y’s 2008 and 2010, the Jakarta Post reported.

However, the impact of the stimulus on currencies throughout the world depends on the internal strengths of each economy, according to Darmin.

“Although the dollar will weaken, the impact on other currencies]will depend on the situations in their own economies,” the central bank governor noted, adding that “our economy has strong fundamentals as we have seen robust growth, low inflation and have a low fiscal deficit.”

The Rupiah Friday hovered at around 9,573 per USD, according to the BI mid rate. The currency has dropped more than 5% this year, the worst performer among Asia’s 11 most active currencies.

The nation’s foreign exchange reserves rose slightly to US$109-B by the end of August, but were still lower than the record high of US$124.6-B in August last year, as the central bank has repeatedly intervened to defend the Rupiah by injecting more “Greenbacks” into the Indonesian market.

Myanmar to exhibit precious Jade products in China-ASEAN expo

A Myanmar exhibition team comprising over 90 gem companies will display Myanmar’s precious Jade products at the upcoming 9th China-ASEAN Expo (CAEXPO) in Nanning, the capital of south China’s Guangxi Zhuang Autonomous Region, official media reported Sunday.

Myanmar jade necklace, bangle, pendant and sculptures as well as ruby and sapphire produced from the famous Mogok region will be mainly exhibited at the expo along with other Myanmar products from the sectors of agriculture, fishery, industry, manufacturing, traditional handicrafts, forestry and hotel and tourism.

The participating companies said “Chinese people highly value Myanmar jade. The number of visitors reached as much as thousands a day in the previous expo and almost every visitor bought at least a piece of jade work. Particularly, they like jade bangle and necklace is their second choice.”

According to the companies, jade items fetch higher prices in the Nanning Expo than the local expo.

Jade bangles were sold with certificates of gems experts in last year’s expo, winning the trust of buyers.

Official statistics show that in Y’s 2010-11, Myanmar yielded 46,810 tons of Jade and 12.962-M carats of gems which include ruby, sapphire, spinel and peridot, as well as 275,688 mommis (1, 033 kilograms) of pearl.

China’s Nanning and Myanmar’s Yangon established friendship city relationship in July 2009.

In Y 2011, bilateral trade between Guangxi and Myanmar reached US$56.19-M, + 197% from Y 2010.

The CAEXPO, co-sponsored by the government of China and the 10 ASEAN member states as well as the ASEAN Secretariat, has been held annually since Y 2004.

Myanmar is awarded the 9th CAEXPO Country of Honor this year and Myanmar President U Thein Sein will deliver speech at the opening ceremony on behalf of the ASEAN member states and inaugurate the event which runs from 19-24 October.

The CAEXPO will be attached with China-ASEAN Business and Investment Summit

BRICS Watch: China GDP to grow 7.7% To 7.8%

Chinese expert expects economic expansion to pick up again, but outside experts; IMF and OECD have recently revised their projections downward for China’s growth.

Fan Jianping, director of the Economic Projection Department with the State Information Center, said Sunday: The Chinese economy will expand between 7.7 and 7.8% in Y 2012, surpassing the 7.5% growth target set earlier this year

The optimism in based on the assumption that China will stimulate its own economy to balance a sharp drop in the appetite for its exported goods

The report adds: As the government has adopted a series of measures, including hastening the approval of major projects, the economy will begin stabilizing in the second half, Fan said, adding that he expects such measures to play a counter-cyclical role in stimulating the economy.

The race between the effects of stimulus and the sharp downturn in the global economy is unlikely to be won by China’s policy.

The demands for China manufactured goods will be and has been crippled by the EU recession and extreme sharp slowdowns in the economies of the US, UK, and Japan

US Economy Watch: Stocks, not housing, seen as Fed’s Big Stimulus winners

The Federal Reserve’s new economic stimulus plan involves printing huge sums of money to help people buy homes, but over the next year the program will likely do more to boost the economy by lifting stock prices.

The Fed said last week it would buy $40-B every month in mortgage backed securities until the labor market improves substantially. The program will likely lower interest rates for mortgages and also help some folks refinance their home loans.

The Fed’s open-ended buying program represents an unprecedented bid to get the US economy growing more quickly, and many economists believe it will have a strong impact on housing market which is being constrained by tight lending policies at banks; mortgage rates are at record lows.

However, it is possible this stimulus will help the economy in other, more powerful ways.

By giving an open-ended commitment to flood money into the market for mortgage-backed securities, the Fed will likely keep supporting stocks and other asset classes by keeping returns low on MBS (mortgage backed securities).

That means that investors in search of yield will have more reason to buy equities and to lend money to companies.

The Fed’s bond buying program will add at least a 0.05 to the US GDP over the next year by boosting stock prices and making people feel wealthier. The main transmission mechanism is through the stock market.

The theory is that people will spend an extra few pennies for every USD of wealth they gain, because so many people have retirement funds connected to the stock market, a boost in share prices will lead people to spend more money.

US Fed Chairman Ben Bernanke said Thursday policymakers hope its new program will help people buy homes, but he acknowledged the aim is also to boost asset prices like stocks and to make families and businesses more confident in the future of the economy.

“If people feel that their financial situation is better … they are more willing to spend,” he said.

US stocks rose more than 1.5% Thursday after the Fed unveiled the new bond buying program, and closed last week near 5 yr highs.

The “Fiscal Cliff” is destructive to US, its economy and world status

If the US Congress does not act to counter the impact of the coming “Fiscal Cliff”, the $110-B in spending cuts that will go into effect on 2 January 2013 will have severe effects according to a report from the US’ Office of Management and Budget.

Sequestration will be destructive to nation’s security, domestic investments and core government functions.

The automatic cuts, technically called “sequestration,” chop 2% from payments to Medicare providers, about 9.4% from the US defense budget, and non-defense discretionary would lose about 8.2%.

Under the deal struck last year, similar cuts are scheduled to be applied annually through budget year Y 2021.

The budget cuts will be combined with the expiration of the Bush administration’s tax cuts, which also expire at the end of Y 2012, to force a reduction in the federal budget deficit.

Neither Democrats nor Republicans favors sequestration, but the dispute over Obama’s demands to raise taxes for high-income earners has halted an acceptable resolution.

It is not likely that a solution will be reached before the November elections, and the short time between then and the end of the year does not bode well for a post-election solution either.

At best, a post-election “Lame Duck” session could delay the country’s dive off the “Fiscal Cliff” some time to give the new President and Congress time to work out a solution.

If Obama wins, the status quo ante will likely be maintained, even if Republicans win control of the Senate and maintain control of the House.

And should, this is very unlikely, the Democrats should control both the White House and both Houses of Congress, that then will be a different story.

A Romney win could cause similar confusion unless the Republicans gain full control of the Congress. Stay tuned…

__________________________________________________________________________________

                      At the Movies with Monica Petrucci from Tinsel Town

North American Box Office Report: ‘Resident Evil’ is # 1, ‘The Master’ is breaking Records

Milla Jovovich fights the Zombies movie took in $21.1-M, Paul Thomas Anderson’s The Master is packing the Art Houses.

The Zombies ruled at the North American box office this weekend as Sony’s Resident Evil: Retribution came in #1.

But the busiest action took place in the 5 theaters in NYC and LA where Paul Thomas Anderson’s The Master debuted to a record-breaking $729,745.

Retribution, the 5th in the Resident Evil series starring Milla Jovovich, took in $21.1-M at 3,012 locations. The R-rated movie from Sony’s Screen Gems unit and Constantin Films and directed by Paul W.S. Anderson checked in ahead of the weekend’s other new wide Hollywood release, Disney’s 3-D reissue of Pixar’s G-rated Finding Nemo, which took in $17.5-M in 2,904 theaters.

The latest Weinstein Co. fare, The Master, coming off momentum it built at the Venice and Toronto film festivals broke records for an exclusive opening.

The drama starring Joaquin Phoenix and Philip Seymour Hoffman as 2 men enmeshed in mind games amassed a record $145,949 per theater beat the previous art house record of $130,759 per location that Focus’ Moonrise Kingdom established in May.

Lionsgate and Roadside also has a success with its financial thriller Arbitrage, starring Richard Gere as a hedge fund manager whose life is unraveling. It attracted $2.1-M on 197 screens, for a per-screen average of $10,505. Also bowing simultaneously as a VOD offering, it looks to be the biggest Theatrical/VOD opening to so far.

Retribution, cost $65 million to produce, did not prove quite as big a draw in North America as the previous film in the series, even with an assist from 3-D and Imax tickets: The previous installment, 2010′s Resident Evil: Afterlife, opened to $26.7-M domestically. But the franchise has become a big seller abroad; Afterlife grossed $60.1 domestically and $236.1-M foreign.

Domestically, 64% of the Retribution audience was male, and 45% was under 25, 48% saw it in 3-D, 14% in Imax. Worldwide, Imax screens accounted for $6.1-M in tickets sold, while $3-M of that came from domestic locations, putting it ahead of the Afterlife numbers achieved in Imax.

In foreign territories, Retribution, which collected $50-M, is also outpacing Afterlife, which took in $39-M during the same time frame. In Japan, the movie opened to $10.3-M, the biggest opening of the year for a Hollywood film and more than double the opening of The Dark Knight Rises. The story was similar in Latin America, where the movie bowed to $3.5-M in Brazil. And in Russia, it picked up $8.5-M.

As for Nemo, the movie is one of the critical and fan favorites in the Pixar canon. Originally released in Y 2003, the underwater tale, featuring the voices of Albert Brooks and Ellen DeGeneres, grossed $867.6-M prior to its arrival in a new 3-D version. But instead of acting like The Lion King, which opened to $30.2-M when it was released in 3-D a year ago, Nemo performed more like the 3-D return of Beauty and the Beast, which opened to $17.8-M in January. And 3-D proved a major lure: 96% of the tickets sold came from 3-D engagements, in line with what Disney saw with Lion King.

In other action, Lionsgate’s The Possession and The Weinstein Co.’s Lawless, both in their 3rd weekends, claimed #’s 3 and 4 spots, with $5.8-M, a take of $41.2-M, and $4.2-M, a take of $30.1-M, respectively.

Focus’ animated ParaNorman, in its 5th weekend, was # 5 with $3-M as its domestic take grew to $49.3-M.

CBS Films’ The Words, starring Bradley Cooper, which opened in 4th place last weekend, slipped to 7th place as it picked up $2.9-M, bringing its total to $9.2-M.

Rounding out the Top 10 are: Universal’s The Bourne Legacy, with $2.9-M, for a take of $107.8-M; Disney’s The Odd Life of Timothy Green, with $2.5-M, a take of $46.3-M; and Warner’s The Campaign, with $2.4-M, and a take of $82.9-M.

The political documentary 2016: Obama’s America opened in 1,407 locations for $1.7-M. The Nicolas Cage thriller Stolen, which Millennium Entertainment introduced in just 141 theaters, did just $204,000 for a per-screen average of $1,447.

IFC introduced Liberal Arts, starring Allison Janey and Richard Jenkins, in 4 theaters, where it took in $30,000. The movie will move into 15 top markets next weekend.

And Anchor Bay Films played the high school reunion movie 10 Years in just 3 theaters, where despite the presence of rising star Channing Tatum, it did only $23,000 worth of business.

Have some fun, see a movie this week.

All the best,

Monica Petrucci from Tinsel Town

_________________________________________________________________________

                            US Major Markets Support and Resistance

DJIA close: 13,593.37

Resistance:

13,668 from the Dec 2007 high

13,692 from the Jun 2007 high

14,022 from the Jul 2007 high

Support

13,297 the Apr 2012, high

The 50-D EMA: 13,087

13,058 the May 2008 high

13,056 the Feb 2012 high

12,971 the early Jul 2012 high

The 200-Day SMA: 12,785

12,754 the Jul 2012 intra-day high

12,716 the Apr 2012 closing low

S&P 500 close: 1465.77

Resistance

1499 from Jan 2008

1539 from Jun 2007

Support

1440 from the Nov 2007 closing lows

1433 from the Aug 2007 closing lows

1425 from the May 2008 closing highs

1427 the Aug 2012 high

The 20-Day EMA: 1424

1422 the Mar 2012 high

1406 the early May 2012 high

1402 the Aug 2012 closing low

The 50-Day EMA: 1399

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 Jul 2011 high

The 200-Day SMA: 1349

1344 the Feb 2011 high

1340 the early Apr 2011 high

NAS close: 3183.95

Resistance

3227 the Apr 2000 intra-day low

3401 the May 2000 closing low

Support

3134 the Mar 2012 high.

3101 the Aug 2012 high

The 20-Day EMA: 3091

3090 the mid-Mar 2012 interim high

3076 the late Apr 2012 high

3042 from the May 2000 low

The 50-Day EMA: 3029

3026 from the Oct 2000 low

3024 a Gap point from early May 2012

3000 the Feb 2012 high

2999 the bottom of the Aug 2012 consolidation

2988 the Jul 2012 high

2962 the Apr 2012 low

2950 the mid-Apr 2012 closing low

2942 the mid-Jun 2012 high

2910 the Mar 2012 low

The 200-Day SMA: 2905

2900 the Mar 2012 low

2888 the May 2011 high

2879 the Jul 2011 peak

2866 the Jul 2012 closing low

____________________________________________________________________         

                                           US Market Sentiment

Watching the VIX: The market rose Friday, it rose Thursday, but Friday it posted some fairly decent gains considering the action on Thursday.

Now check what happened to Volatility (VIX): It rose as the market rose.

Typically, those numbers move inversely. So, as fear rises, volatility will rise, and the market falls.

Looking at the VIX chart, volatility rose 3.27% Friday as the market extended the rally.

Now look where Volatility rallied from, the old lows that I have noted; April of 2011, March of 2012, and August 2012. It bounced off of those marks each time they were tapped.

Volatility moved higher Friday as the stock market moved higher, that is an abnormal type of move.

That suggests to me that the stock market is ready to fall if this relationship continues.

When I check back on what the S&P 500 did last time the volatility index (VIX) tapped this mark and bounced, it was just a modest fade.

That fade formed up broke support, and it looked like it was headed South. But, it reversed 2 Thursdays back on the news of the ECB agreement.

Volatility rose off of the support level, but the S&P500 only faded modestly.

While the market may be in for a bit of a pause to refresh based upon this, it may not be much of a pause or refresh.

That, would mean more of a buying opportunity that we would like to see after last Thursday’s rise followed by furthered Friday gains, and it is good to take advantage of more gains when they are there.

If we see a pullback with something like the VIX bouncing and the S&P 500 fading a bit, be ready, and take good advantage.                                                 

                                                               Bulls vs. Bears

The Bulls are at 51.1% vs. 51.0% last. I expect the Bulls to rise this week, and worry about a move to the 60- 65% Bullish marks that signal a Warning light. Over the past month the Bulls have moved from 43.6% from 34% in June, the level indicating Bullishness. The Bulls are not at a dangerous mark as they are acting as they should do.

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 25.5% vs. 24.5% last. The Bears spent 2 weeks at 24.5%; they never made it to the 35% that can be a Bullish signal. The Bears need to be over 35% that is the mark for a good upside signal.

For your reference: Bearishness hit a 5 year high at 54.4% the last week of October 2008. The move over 50 saw Bearish sentiment to its highest level since Y 1995, extreme negative sentiment for 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

The Overall Fundamentals

Precious Metals

Gold recorded gains for the 4th week running driven by the ECB’s new asset purchases and then by the Fed’s Big Stimulus announcement. The precious Yellow metal gained momentum after cracking the 1700 resistance in early September.

The next resistance is the 1792/1804 level.

While I expect the positive impacts of the Fed’s Big Stimulus may be less than prior Fed measures, precious metals could be an exception as physical demand are of less influence on precious metal prices. Concerns over debasement of “Fiat” currencies and inflation will boost investment of precious metals this time around I believe.

PGMs’ rally extended with Platinum and Palladium prices gaining +7.35% and +6.80% respectively on the week.

Labor actions in South African mines intensified, heightening concerns over the supply outlook.

Anglo American Platinum, the world’s largest Platinum producer, admitted closure of its Rustenburg operations on Wednesday while Impala, the 2nd largest producer, Tuesday, stated that workers wanted their pay to be raised for a second time this year.

Lonmin, indicated on Monday that only 6% of its shift workers have come back to work, as labor protests continued.

Strikes in South African mines raised concerns that the situation would worsen as labor actions to all over the industry in the country

Crude Oil

Following the ECB’s announcement of the new asset purchase program, Crude Oil prices pushed higher as the on the Feds announced Big Stimulus . The front-month contract for WTI Crude Oil broke above 100 Friday before ending the week at 99.00, +2.68%.

The Brent Crude contract stayed firmly above 115 and settled at 116.92, +2.11% on the week.

Besides central bank quantitative easing, Crude Oil prices were also lifted by Middle East tensions.

The US consulate in Benghazi, Libya, was under attack on 11 September and the US Ambassador to the country and 3 colleagues were killed.

This, together with demonstrations in Egypt, Tunisia, Sudan, Iran and Yemen due to an anti-Islamic video, raised concerns over Crude Oil supply disruption.

Although recent data has shown that Crude Oil production in Libya has largely returned to pre-civil war level, risks of supply shortage in the OPEC producer should not be eliminated yet, especially the country is undergoing power transition.

Another indicator showing supply concern is that OPEC’s spare capacity is expected to drop to 2.21-M BPD in this year before recovering to 2.38-M bpd in Y 2013. OPEC’s excess supply has fallen below the 10-yr average, 2001-2011 or 2.66-M BPD for the 1st time since Y 2008.

Nat Gas

According to the DOE-EIA, Nat Gas storage increased +27 bcf to 3 429 bcf in the week ended 7 September. Stocks were +342 bcf higher than the same period last year and +284 bcf above the 5-yr average of 3 145 bcf.

Baker Hughes reported that the number of Nat Gas rigs fell -4 units to 448 in the week ended 13 September. Oil rigs gained +4 units to 1 413 and miscellaneous rigs stayed unchanged at 3 units and the total number of rigs was unchanged at 1 864 units. Directionally oriented combined oil, gas, and miscellaneous rigs slipped -7 units to 207 units while horizontal rigs decreased -2 units to 1 133 and vertical rigs rose +9 units to 524 during the week.

The Overall Technicals

Comex Gold (GC)

Gold’s rally extended last week and reached as high as 1780.2.

Near term outlook remains Bullish with focus on 1792.7/1804.4 the next resistance zone.

A clear break there will have larger Bullish implication and would show the way to 1923.7, the historical high. Nonetheless, the rise from 1526.7 is viewed as a leg inside the medium term ranging pattern only. A move below 1720, the minor support, signals a reversal and turn near term outlook Bearish.

The Big Picture: price actions from 1923.7, the high, are viewed as a medium term consolidation pattern. There is no indication that such consolidation is finished yet, and more range trading could be seen.

In any case, downside of any falling leg should be contained by 1478.3/1577.4, the support zone, and bring on a rebound. A clear break of 1792.7/1804.4, the resistance zone, augurs that the long term up-trend is possibly resuming for a move to a new high above 1923.7.

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

Comex Gold Continuous Contract Weekly Chart

Comex Silver (SI)

Silver’s run extended last week too, and tapped 34.98. My near term outlook remains Bullish as long as 32.72, the support holds, this rally can run to 37.58, the Key resistance.

But, caution is the watch word, on the lookout for a reversal signal at it approaches 37.58. A clear break of 32.72 will be the 1st sign of a near term reversal and will turn focus back to 30.195, the Key support.

The Big Picture: as long as the 37.58 resistance holds, price actions from 26.105 are viewed as a consolidation pattern. That means, the down trend from 49.82 high is not finished, and a new low below 26.105 is possible. But, a clear break of 37.58 will dampen such Bearish scenario, and could bring on a stronger run back to the high at 49.82.

The Long Term Picture: the Big Q remains as to whether 49.82 is a medium term or long term Top. I have changed my thinking; with 61.8% retracement of 8.4 to 49.82 at 24.22 intact, price actions from 49.82 could turn out to be a consolidation pattern only. And a clear break of the Key resistance at 37.58 will increase the odds for Silver to reach a new high above 49.82. Stay tuned…

Comex Silver Continuous Contract Weekly Chart

Nymex Crude Oil (CL)

Crude Oil’s rally resumed last week and breached 100, the psych mark, before closing at 99.06.

My near term outlook stays Bullish just as long as support holds at 94.08. This current run is expected to continue higher. But, as I have noted before in this column, the rise from 77.28 is viewed as the 4th leg inside the triangle pattern from 114.83. So, be cautious of topping between 100 and 110. A clear break of 92.94 will signal a reversal and bring decline back to 55-Days EMA and below.

The Big Picture: the price actions from 114.83 are seen as either a 3 wave consolidation pattern that finished at 77.28, or a 5 wave triangle pattern that is still unfolding. No matter, a break of 110.55 the Key resistance strongly suggests that the rebound from 33.29 has resumed for move to 114.83 and above. While another fall could be seen before an eventual upside breakout, any downside should be contained above 77.28, the support mark.

The Long Term Picture: Crude Oil is in a long term consolidation pattern from 147.27 IMO, with the 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. Crude Oil 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.

Nymex Crude Oil Continuous Contract Weekly Chart

______________________________________________________________________________

                                 Red’s Forex report: EUR-USD pair

EUR-USD pair Clearing 1.30 and now 1.31; sees 1.3270

After briefly holding under 1.30 during late 9/13 US trading, the EUR-USD continued to run higher through the 9/14 Asian-European session and into the subsequent US session. It is now cracking the 1.31 handle.

The Big Q: where will this rally pause to refresh?

We can probably expect some slow down as we get close to the next half and whole intervals like 1.3150, and 1.32, but a Bullish market will now probably hold above 1.30.

Trend line resistance: The next major resistance is near 1.3270. This was a previous resistance pivot on 4/29 that was followed by a sharp decline in May through June and most of July. It will likely meet the declining trend line that goes back to the 1.4940 high from May 2011. This will be a major challenge for the EUR-USD.

It should be noted that EUR-USD is running on parallel tracks in here. Big Stimulus aka QE-Infinity because it has no fixed amount and is conditional to economic conditions and the Eurozone bailout development.

The high from these 2 hits is giving the market full on risk-on that should slow down next week, even if the direction does continue.

2012 High: If the market pushes above 1.3270, 1.33 handle, the 1.3490, level, 50% retracement just above the 2012 high will be targeted. Stay tuned…

The Weekly Chart

____________________________________________________________________________________

                                             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.minesitesforsale.com

http://www.livetradingnews.com/coal-news-indonesia-86164.htm#.UFZn443ib8U

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: 0.23

Current PE: 4.0

Revenue Growth: 148%

1 yr Target Price: 1.05

Analysts Rating: Strong Buy

http://www.traithienusa.com   

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

             Options Trade Alert: Vanguard MSCI Emerging Markets ETF (NYSEARCA: VWO)

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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