Yes, it’s all about the employment numbers on Friday. Are we overbought?….but is it a good overbought? The kind of overbought we got into in mid-March 2009? Friday’s reports will tell us.
All the news has been “not bad” the past 2 days…and if we can get another day’s worth, boy oh boy, we may go into the Labor Day weekend over 1100 S&P. Got to admit, that would be nice!
My moneymakers today were QTM AEZS USO and XLE. Friday’s pick’s will have to wait for the Non-Farm payroll report to get a feel for the trend. I would like to see oil try for $76 and the US dollar to rest in the $82 area. What the hell, the market never does what I want it to do. 
The stock market is the biggest junkie in the world. The Fed says that we don’t need no stinkin’ quantitative easing, which should be good news, but the market quickly goes into DT’s and trembles all the way down. “But every junkie is like a setting sun.”
No QE means a strong economy, it means a recovery is in process! Oh, but it also means a strong dollar…and at the present the stock market does NOT like a strong dollar. So today, everytime the dollar shot up, the stock market, along with the oil market, moved down. And it seemed to happen about 20 times today!
Volume doubled yesterday’s totals and I think it should continue throughout the week, even though we are leading up to a holiday weekend. Too much news going on which will stir up the pot. Tonight I was waiting for China’s PMI, which has come out at 51.7, up from last months 51.2. And by morning we should have heard some GDP’s from European countries. We’ve also got ADP payroll report Wednesday morning, along with Construction Spending and oil inventories and more.
So much going on, Australia GDP up along with China PMI so futures are moving up strong also. Let’s hope it lasts until US markets open….and through the day tomorrow! 
Ok, it’s not what I would call a follow-through day, but it was a decent reaction to yesterday’s up move. Neither day had any volume, but today’s consolidation was on lower volume than yesterday’s explosion. So far, we’ll still sitting good for a continuing up move.
Asian markets are opening soft with the Nikkei down almost 2%, but S&P futures are still hanging around breakeven. Gold is trying to move up and oil is moving down.
Wednesday brings us the ADP Employment report at 8:15AM…..the predecessor to Friday’s big show. We’ll see if the markets deserve to continue its up move. Maybe oil inventories will help. The US$ levels are getting low enough that if it goes any lower, stocks may begin to worry. I’d actually like the $ to stabilize.
So much analysis, so little time. 
Published on
July 20, 2010,
10:36 pm in
Opinions, Tools and Trading.
Tags: AAPL, BAC, C, dollar, GE, GS, oil, Tools.
So wasn’t there some news this morning about bad earnings from GS? And weren’t C BAC GE still bad? Isn’t everyone worried about the bank stress test in Europe? So why are all the traders happy today?
Funny that the US dollar did not matter, or at least there is not that strong correlation between the US$ and the markets. Oil still seems to be correlated, as oil went up so did the indexes.
Lots and lots of earnings on Wednesday…and even more on Thursday! I’m interested in MS WFC KO QCOM and NFLX. That should give me an idea of how the world is doing. And if the markets can’t rally on this evening’s AAPL report, then we’re in real trouble!
I apologize for some short blog entries, but I’m having technical difficulties with my hardware this week. I have tracked the problem(s) down, but new parts will take 7-10 days. In the mean time I’ve fired up a backup PC and getting it ready for trading tomorrow.
See you on the playing field.
Futures markets, along with Asia markets, are starting off in happy mode. We may just get back to the upper channel on my S&P charts at about 1106. Of course it’s early evening and we still have to have Europe open up, but so far if “feels” good!
Oil is moving up also and will help my UCO position. I’m looking hard at adding some other commodity ETFs this week: DYY DAG GRU DBA. A lot will depend on the US dollar and the euro of course.
And don’t forget it’s options expiration week. According to the Stock Trader’s Almanac, the Dow was down big in 2008 after being up 5 years in a row 2003-2007 for June expiration week.
Hang on, we’re in for another ride.
Dow up almost 500 points off the lows and S&P is 60 points up, all in 5 days. Sure it’s been an up and down, zigzag road, but do you think we’ve seen the bottom of this correction?
The Advance/Decline volumes were big today, much bigger than yesterday’s down volume: Naz +8:1 NYSE +18:1 RUT +11:1 All US stocks +10:1 yeah baby! The TICK stayed above the -400 line most of the day, dipping down just occasionally. And futures this evening and Asian markets are acting nicely. Euro moving up and US$ moving down….C’mon Europe you can do it!
Lotsa news on Thursday….before the open we have ADP Employment Change, Productivity-Revision, Unit Labor Costs, Initial Claims and Continuing Claims. As if that wasn’t enough we get Factory Orders and ISM Services after the open. Will there be enough good news out of all that to have a confirmation day? The Dow and S&P haven’t strung 2 up days together since April!
OK bulls, you better pull this off tomorrow
World markets have brought up gold and oil, as well as equity futures. There’s still another day of trading before the US cash markets open, but, so far so good.
It looks like geo-political news will catch the spotlight before bailouts and euros do. Sure it’s all related, but you may want to keep an eye on commodities this week, especially gold and oil. A couple notes on what’s cooking out there on the war front: Deaths as Israeli forces storm Gaza aid ship, Koreas Ease Tensions With Small Gestures, China Balks at Criticism of North Korea, and Israel braces for Turkish, Hizballah, Hamas reprisals. Greece halts joint drill. We live in interesting times.
Coming this week on Friday, we have the monthly US Jobs report, which should show the much awaited pop created by census worker hiring. This should be psychologically motivating if we see over 300K jobs created. On the other hand we may also see a pop in layoffs in a couple of months as the government will not need all these census workers anymore. It’s like getting drunk….we have fun and feel good for a little while, but we’ll feel the hurt later. 
If all the euro-country lending/bailout stuff has got you confused, then this video, Lending merry-go-round, should straighten it all out for you. 
Hope everyone had a great long weekend. Thanks to the family and friends of our military might…past, present and future….without whose dedication and sacrifices we could not do all the things we take for granted. Thank you!
I had a fun and profitable morning of trading in equities and futures…and I should have quit with money in my pocket. But no! Encouraged by my success earlier in the day, I continued to trade futures. Expecting a nice rally into the close, I played it that way. The last half hour of the day wiped out my profits for the day and cut into my account….dammit!
Okay, the lesson learned? Trade what the market is doing, not what you think it will do. I know this, but it has happened before. How did I get sucked into this…again? Not paying attention, not taking the stop, convinced that I am right and the market is wrong. I let my rules slide right by me…idiot! Oh well, I made a mistake, I admit it and tomorrow is another day to start all over again.
Speaking of which…futures are in the midst of a crashette this evening…already down over 1%….and looking for a bottom. The US dollar looks like the culprit, up strong, or maybe the euro, getting weaker…it’s all about currencies. But there may be other distractions…like a lot of countries needing to issue bonds this week, oil dwindling down and gold spiking up. Like I just learned today, trade what the market presents to me.
I better go over my rules again. Here’s an interesting dichotomy:
Goldman Sachs Says Sell-Off Consistent With Past Corrections, Sees S&P 500 at 1,300.
Why Stocks Are Going Lower Long Term.
Although the headline reads: “US Payrolls Rose 162,000 In March, Less Than Expected,” there were a lot less census jobs than were expected, as the private sector added 123K jobs. That’s a good number, even though we need 5 times as many to make any real impact on unemployment. The unemployment rate 9.7% stayed the same but the number of workers unemployed for greater than 6 months rose. The “real” unemployment number rose to 16.9%. Once the headline was released the futures took a dive but quickly recovered when the census and private sector numbers were released. The ES futures closed in the green, up 4.25 points from Thursday’s cash close.
Friday’s report was largely in line with expectations, but economists noted it may be difficult to gauge the health of the labor market for the near future. The hiring of thousands of part-time census workers will continue through end of the summer, inflating the numbers. –NY Times
While we wait for markets to open on Monday (Sunday night for you futures traders). the other big news is iPad. The TV news is already showing people lining up at Apple stores for Saturday’s release.
Looking at the iPad From Two Angles
Laptop Killer? Pretty Close
Have a happy iPad weekend…..oh yeah, and a Happy Easter!
Sometimes, entranced by the screens, watching equities, options and futures change colors, charts moving in a wave, and indicators pointing in every direction, I just have to scream....
