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March 2013

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Base Metal Stocks Remain In The Basement

March 28, 2013 – Comments (0) | RELATED TICKERS: TCK , VALE , BHP

This morning, many of the leading base and industrial metal stocks are retreating again. This important industry group has been very weak in 2013. One of the leading stocks in the sector is Teck Resources Ltd (NYSE:TCK). This stock is now trading down to its September 2012 lows. Today, TCK stock is trading lower by 0.24 cents to $28.05 a share. Short term traders should watch for intra-day support around the $27.85, and $27.30 levels. The daily chart trend remains down at this time with TCK stock trading below the important 50 and 200-day moving averages.

Some other leading base and industrial metal stocks that are declining on the trading session include Rio Tinto plc (ADR) (NYSE:RIO), BHP Billiton Limited (ADR) (NYSE:BHP), and Vale SA (ADR) (NYSE:VALE). All of these stocks mentioned will usually be weak when the Chinese stock market declines. Last night, the important Shanghai Index finished lower by nearly 3.0 percent.

Nicholas Santiago
InTheMoneyStocks.com
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Netflix Triangle Signals A Little More Upside

March 26, 2013 – Comments (0) | RELATED TICKERS: NFLX

Netflix, Inc. (NASDAQ:NFLX) is trading at $190.68, +9.89 (5.47%). The stock is having a solid day but still trading in a technical triangle pattern. A triangle basically alerts traders to consolidation. In this case, it tells of bullish consolidation for one final move higher. The move higher should take it to $208.00. This would be a technical gap fill level and major resistance.

Gareth Soloway
InTheMoneyStocks

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FedEx Leads The Transports Lower

March 25, 2013 – Comments (0) | RELATED TICKERS: FDX , UNP , DAL

One of the leading transportation stock in the world is FedEx Corp (NYSE:FDX). Last week, this stock reported earnings that were below analysts expectations. The company also cited weaker demand internationally. Today, FDX stock is declining lower by $1.57 to $96.88 a share. Short term traders should watch for intra-day support around the $95.30, and $93.69 levels. FDX stock is also trading below the important daily chart 50 moving average which puts the stock in a weak technical position.

Some other leading transportation stocks that are declining lower today include Union Pacific Corporation (NYSE:UNP), Delta Air Lines Inc (NYSE:DAL), and United Parcel Service Inc (NYSE:UPS). Please understand, FDX stock is the most important transportation stock in the industry group.

Nicholas Santiago
InTheMoneyStocks.com
  [more]

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Stock Market Beverage Wars: PepsiCo, Coca-Cola, Snapple

March 25, 2013 – Comments (0) | RELATED TICKERS: PEP , KO , DPS

This morning, the S&P 500 Index e-mini futures (ES-M3) are trading higher by 4.50 points to $1556.25 per contract. It seems that the stock futures are catching a bid higher after the European Union and Cyprus reached a bank bailout deal last night. Depositors with less than 100,000 euros in their accounts will not have to pay a bank levy. The levy (tax) will affect depositors with over 100,000 euros in their account. This deal will not need approval from the Cypriot parliament.

Most of the leading European stock indexes are trading higher on the news. Traders can watch for early strength in the leading European bank stocks. Some equities that are trading higher before the opening bell include Deutsche Bank AG (NYSE:DB), Credit Suisse Group AG (NYSE:CS), UBS AG (NYSE:UBS), and the iShares MSCI Europe Financials Sector Index Fund (NYSEARCA:EUFN).   [more]

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Stock Market Beverage Wars: PepsiCo, Coca-Cola, Snapple

March 25, 2013 – Comments (0) | RELATED TICKERS: PEP , KO , DPS

Recently, leading soda and non-alcoholic beverage stocks have been some of the best market performers. One of the leading soda and beverage stocks is PepsiCo Inc (NYSE:PEP). This stock is now approaching its 2007 high, which was $79.79 a share. Last week, PEP stock closed at a new 52 week high of $78.64 a share. Anytime a leading stock trades into an important old high, that old price will become near term resistance. Should PEP trade above that level, the next near term chart resistance would be around the $81.00 - $82.00 level; watch for PEP to see a pullback from this area. Once this price range is reached, traders should then watch for a consolidation pattern to form, this will indicate that the stock is going to move higher in the future. PEP stock is one of the strongest stocks in its industry group.
 Some of the leading competitors to Pepsi Co Inc include The Coca-Cola Company (NYSE:KO), Dr Pepper Snapple Group Inc (NYSE:DPS), Cott Corporation (USA) (NYSE:COT), and Monster Beverage Corp (NASDAQ:MNST). Most of the leading beverage stocks are looking close to being overbought in the near term. This tells us that the upside in this sector should be limited. PEP stock is still the strongest stock in the industry group at this time, but don't expect much more upside in the near term. Simply read the charts correctly and the direction of the next move will reveal itself.

Nicholas SantiagoInTheMoneyStocks

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Oracle Stuns Stocks, But It Is A Minor Factor On Market To New Highs

March 21, 2013 – Comments (0) | RELATED TICKERS: ORCL , SPY , CAT

Oracle Corporation (NASDAQ:ORCL) stunned the markets with a poor quarterly report. In the last few days, stocks like Caterpillar Inc. (NYSE:CAT), Deere & Company (NYSE:DE) also disappointed. While the  markets pulled back and are trading slightly lower, this is not even close to enough to derail the move on the S&P 500 to new all time highs.

The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is trading at $155.11, -0.52 (-0.33%). This is well off the lows. The all time high on the SPY is $157.52. Regardless of poor earnings and European issues, the market appears destined to hit all time highs. Once hit, it should spike even higher, squeezing out shorts that jump on board at that level.

Gareth Soloway
InTheMoneyStocks

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Natural Gas Stocks Retreat

March 21, 2013 – Comments (0)

This morning, many of the leading natural gas stocks are pulling back after the U.S. Energy Information Administration (IEA) data. The United States Natural Gas Fund has pulled back intra-day after the IEA report for natural gas was released. Today, the UGA is trading lower by 0.02 cents $21.59 a share.

Some of the leading natural gas stocks that have declined after the natural gas report include Chesapeake Energy Corporation (NYSE:CHK), Devon Energy Corp (NYSE:DVN), Southwestern Energy Co (NYSE:SWN) and Clean Energy Fuels Corp (NASDAQ:CLNE). CHK stock will have some short term intra-day support around the $20.40 level. The daily chart of CHK should have short term support around the $19.00 area.


Nick Santiago  [more]

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Down in Sympathy

March 21, 2013 – Comments (0)

Last night, leading application software firm Oracle Corp (NASDAQ:ORCL) reported earnings that were below analysts expectations. The report was a major disappointment for the tech sector. Today, ORCL stock is trading lower by more than 8.0 percent to $32.77 a share. 

Often, when a major stock declines such as ORCL it will cause other market leading stocks to decline in sympathy to it. One of the leading stocks in the application software space that is coming under selling pressure is SAP AG (NYSE:SAP). This stock should have very good intra-day support around the $79.95 level. The daily chart of SAP will have good support around the $78.70 area. 

Some leading equities that are also falling on the back of the ORCL earnings report include International Business Machines Corporation (NYSE:IBM), CA Technologies (NASDAQ:CA), and Microsoft Corporation (NASDAQ:MSFT). 

Nick Santiago
InTheMoneyStocks
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Just Watch This Stock

March 20, 2013 – Comments (0) | RELATED TICKERS: JPM

The most important stock in the market is J.P. Morgan Chase & Co (NYSE:JPM). This stock has led the major stock indexes higher and lower over the past five years. Recently, the stock has been bombarded with negative news regarding its highly publicized London Whale trading loss. When JPM stock declines it is often viewed as a stock market barometer. Traders should note that JPM stock just traded into a mountain of chart resistance around the $51.00 level. The daily chart of JPM is signaling some support around the $47.00 level. Should that level fail to hold as support then it could spell real trouble for the stock market and the market leading financial stocks. Short term traders should watch for intra-day support around the $48.40 level. 

Some other leading financial stocks that traders should follow closely include Deutsche Bank AG (NYSE:DB), Goldman Sachs Group Inc (NYSE:GS), BlackRock Inc (NYSE:BLK), and Bank of America Corporation (NYSE:BAC). This industry group has been one of the top sectors since October 4, 2011. If this sector starts to rollover it should indicate that a true stock market correction is underway. Until that time, just follow the financial stocks. 

Nick Santiago
InTheMoneyStocks
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Just Watch This Stock

March 20, 2013 – Comments (0) | RELATED TICKERS: JPM

The most important stock in the market is J.P. Morgan Chase & Co (NYSE:JPM). This stock has led the major stock indexes higher and lower over the past five years. Recently, the stock has been bombarded with negative news regarding its highly publicized London Whale trading loss. When JPM stock declines it is often viewed as a stock market barometer. Traders should note that JPM stock just traded into a mountain of chart resistance around the $51.00 level. The daily chart of JPM is signaling some support around the $47.00 level. Should that level fail to hold as support then it could spell real trouble for the stock market and the market leading financial stocks. Short term traders should watch for intra-day support around the $48.40 level. 

Some other leading financial stocks that traders should follow closely include Deutsche Bank AG (NYSE:DB), Goldman Sachs Group Inc (NYSE:GS), BlackRock Inc (NYSE:BLK), and Bank of America Corporation (NYSE:BAC). This industry group has been one of the top sectors since October 4, 2011. If this sector starts to rollover it should indicate that a true stock market correction is underway. Until that time, just follow the financial stocks. 

Nick Santiago
InTheMoneyStocks
  [more]

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Answered: Why Markets Hit Again On Cyprus Worries

March 19, 2013 – Comments (5)

The markets are taking a hit again today on more worries out of Cyprus. This tiny country is turning out to be a possible catalyst for contagion in the Euro Zone. Plenty of new drama is surfacing. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is trading at $154.32, -0.65 (-0.42%).

There was a scheduled vote today on whether or not to impose the tax on depositors in Cyprus. The automatic tax on all funds within banks in Cyprus sent the markets reeling yesterday. However, today, even if the vote did not pass, disaster could be around the corner.

If the vote does not pass, Cyprus may have to exit the Euro Zone as they default on their loans. Should this happen, it could spread quickly to Greece, Italy, Spain and Portugal.

In other words, if the vote passes and a tax is imposed on all depositors, it creates a run on the banks, if it is not passed, Cyprus defaults exit the EU. Either way, contagion is a very likely outcome across Europe.

Gareth Soloway
InTheMoneyStocks

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Base Metal Stocks Weigh On Markets

March 19, 2013 – Comments (0) | RELATED TICKERS: RIO

This morning, most of the leading base and industrial metal stocks are declining at the start of the trading day. One of the leading stocks in the sector is Rio Tinto plc (NYSE:RIO). Today, RIO stock is declining lower by $1.72 to $47.53 a share. It should be noted that RIO stock traded as high as $60.45 a share at the start of 2013. So traders can easily see how this stock and industry group has rolled over recently. Short term traders should watch for intra-day support around the $46.35 level. This level will also be daily chart support, however, the $43.00 area looks to be a stronger daily chart support area should the stock trade down to that level.

Some other leading base and industrial metal stocks that are declining lower on the session include Vale SA (ADR) (NYSE:VALE), BHP Billiton Limited (ADR) (NYSE:BHP), and Teck Resources Ltd (USA) (NYSE:TCK). The stocks in this sector will usually be affected by Chinese economic growth and a stronger U.S. Dollar Index.

Nick Santiago
InTheMoneyStocks
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Inside Analysis: Understanding The Market Drop

March 18, 2013 – Comments (0) | RELATED TICKERS: SPY

The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is trading at $155.46, -0.42 (-0.27%). The low of the day was $154.20 as the markets have bounced well off their lows. So why did the markets fall today? Additionally, why have they recovered so nicely?

The Trigger: News

As part of a bailout deal reached with the EU, Cyprus committed to taxing deposits in its banks up to 9.9% for accounts over 100,000 and 6% for all accounts under. This means, all those savers who stashed cash (rich or poor) and were not wild spenders will pay dearly.

Why It Is A Big Deal?

Bank Runs: If you knew your money in the bank was going to be taxed at 10%, wouldn't you go remove it immediately and store it under your mattress? I would and so might many in European countries like Cyprus, Greece, Italy, Spain. This is the fear. If Cyprus is setting a precedence, bank runs could begin. Many in Cyrus have already gone to the ATM's and withdrawn as much as they can. Mass bank runs would send Europe into a catastrophic collapse.

Why The U.S. Markets Are Recovering?

Poor banking conditions in Europe and fear of a tax on deposits will only encourage money to be transferred into the United States banking system. More money into the U.S. is not a short term negative, but a positive. Some of this money flow will even find its way into the Dow Jones Industrial Average, S&P 500 and NASDAQ. In addition, any short term hurt to the global outlook is another reason the Federal Reserve will stick around longer, printing money.

Gareth Soloway
InTheMoneyStocks

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IBM Blow-Off Top?

March 14, 2013 – Comments (0) | RELATED TICKERS: IBM

International Business Machines Corp. (NYSE:IBM) surged today, blowing up to a new all time high. The stock had a dramatic rise in the morning session spiking to a high of $215.59 after closing yesterday at $212.06. This run today is coming on heavier volume that usual and could be a blow-off top. A blow-off top is a term known for where all the shorts cover, the retail longs buy and the institutions dump, ultimately a top. The culmination of these events creates the dramatic jump in share price on heavier than normal volume. 

Another interesting note is that IBM has moved higher over the last two weeks from a low of $197.51 to the high today of $215.59. This is a run of $15.08. In the world of IBM, that is monstrous.

Whether this is a blow-off top or not will not be known for days if not weeks, but the move has all the signals of that possibility.

Gareth Soloway
InTheMoneyStocks

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Here Is The Problem With This Rally In The DJIA

March 14, 2013 – Comments (0)

Every talking head on the financial news networks are celebrating the new all time closing high on the Dow Jones Industrial Average (DJIA). Last week, the DJIA crossed above the 14,198.00 level that was last made in October 2007. Today, the DJIA is trading as high as 14,515.00 which would be another new closing high on the DJIA. Many analysts and Dow Theory followers are looking for much higher levels on the DJIA. So what are the problems with this rally if everyone is so bullish at this time?

The first and biggest problem with this rally in the DJIA is that it has occurred on the back of a stronger U.S. Dollar. If traders and investors look back at recent history the stronger U.S. Dollar Index (DX) will usually hurt corporate profits for the multi-national companies. The DJIA is made up of all multi-national companies. Over the past twelve years the stocks that make up the DJIA have actually rallied because they can sell more goods abroad with a weak U.S. Dollar. If traders and investors look at a long term chart of the U.S. Dollar Index futures (DX) they will see that every time the U.S. Dollar surged for more than a couple of months that is when a sharp correction occurred. If companies cannot increase their exports then their profits will decline. It's just that simple, you sell more product abroad with a weak currency. The U.S. consumer can only carry these companies so far. Can stocks such as Procter & Gamble Co (NYSE:PG), Hewlett-Packard Co (NYSE:HPQ), and International Business Machines Corp (NYSE:IBM) sell more goods abroad (exports) if the U.S. dollar Index continues to strengthen? I seriously doubt it.

Every country in the world is now devaluing there currency to try and boost their exports. Has anyone looked at a chart of the Japanese Yen recently? The Japanese Yen has been plunging lower against every major currency in the world these days and that has helped the Nikkei 225 Index to rise to new 52 week highs. This money printing is not going on by just the Japanese, it is occurring in the United States, European Union, England, India, China, Zimbabwe, and almost every other fiat currency nation in the world. In other words, the race is on by almost every country to devalue their currency faster than the next country to boost exports.

The U.S. Dollar Index futures (DX-M3) have been rising on the back of better economic data in the United States. There is also more money printing taking place in the other countries and that is forcing traders and investors to buy U.S. Dollars. The next factor for why the U.S. Dollar Index is rising is because the U.S. Dollar is the world's reserve currency. For example, if you are trying to buy a barrel of oil in Japan you must convert Japanese Yen into U.S. Dollars in order to buy that barrel. Most commodities trade in U.S. Dollars so there is always going to be some demand for dollars by other countries. Either way, the strong U.S. Dollar is going to hurt the multi-national corporations in the DJIA. During the next earnings season this will be evident. This is the biggest problem with this current rally in the DJIA.

Nick Santiago
InTheMoneyStocks.com

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Could Apple (NASDAQ:AAPL) Lead The Next Market Surge?

March 13, 2013 – Comments (1) | RELATED TICKERS: AAPL

The markets are consolidating again in a bullish manner. Even at recent highs, the markets appear to want to charge higher again. Many people are wondering what the catalyst will be? Will it be the Federal Reserve, earnings, economic data? The charts tell us that if the markets are going to charge higher, Apple Inc. (NASDAQ:AAPL) will lead the way.

This makes perfect sense. Former darling Apple is holding a major technical level on the daily chart but has yet to bounce hard. The PowerShares QQQ Trust, Series 1 (ETF) (NASDAQ:QQQ) has lagged this massive rally and catch up may be on the horizon. Any mild spike higher on Apple will ignite a ton of short covering as well. This will extend the Apple move to possible $485-$500.

The charts show a strong possible solid move coming in the markets. Apple will likely head this charge to new all time highs on the S&P 500.

Gareth Soloway
InTheMoneyStocks.com

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The Dollar Tells Us A Big Market Rally Is Coming

March 13, 2013 – Comments (0) | RELATED TICKERS: UUP

The Dollar moved dramatically higher again today, extending the already massive gains over the last month. This run in the Dollar has been one for the ages. In the near term, it has decoupled from the inverse relationship with the U.S. markets. Usually, if the Dollar goes up, the markets drop. Recently, the action has shown us that when the Dollar moves higher, the markets are flat to positive, and when the Dollar moves lower, the markets rally strongly. In other words, heads the market wins, tails the market wins again.

This is significant when looking at the Dollar chart. For instance, let's look at the PowerShares DB US Dollar Index Bullish (NYSEARCA:UUP). Today, it is trading at $22.60, +0.10 (0.44%). The significance of this move today is two fold. First, the daily chart filled a massive gap to the upside. Gap fills to the upside usually result in pull backs. If the Dollar pulls back, the markets should head higher. Next, take a look at the weekly chart of the Dollar. Shown on the chart below. The weekly has hit the 200 moving average. This is a major resistance. Should the Dollar pull back off this level, the markets should head higher.

Both time frames are dictating a pull back on the Dollar in the near term. This tells us traders to expect a strong move up coming in the markets.

Gareth Soloway
InTheMoneyStocks

  [more]

Recs

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Gold Miners On The Move

March 12, 2013 – Comments (0) | RELATED TICKERS: GDX , AUY , NEM

This morning, the leading gold mining stocks are catching a bid higher at the start of the day. Traders can easily track and trade the gold mining stocks by following the Market Vectors Gold Miners ETF (NYSE:GDX). Today, the GDX is trading higher by 0.90 cents to $37.86 a share. Short term traders should watch for intra-day resistance around the $38.00, and $38.37 levels. The GDX made a high volume outside day on the daily chart of March 6, 2013. Until this low price is breached on a daily chart closing basis the GDX could see further upside.

Some leading gold mining stocks that are catching a bid higher today include Yamana Gold Inc (NYSE:AUY), Goldcorp Inc (NYSE:GG), Newmont Mining Corp (NYSE:NEM), and IAMGOLD Corp (NYSE:IAG). These leading gold stocks will generally follow the action in the GDX. Currency devaluation can also affect the action in the gold mining stocks.
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Apple Weakness Continues: Here Are The Important Levels

March 11, 2013 – Comments (2) | RELATED TICKERS: AAPL

Apple Inc. (NASDAQ:AAPL) is trading at $427.58, -4.14 (-0.96%). This is again happening on a day when the markets are up and the S&P 500 has hit a new multi year high. So what does this mean?

Apple continues to show relative weakness. This tells us if the markets ever drop, Apple will take a beating. The one saving grace for Apple is the $419.00 level. This level is holding from a week ago and represents a major gap fill on the daily chart. As a technical level, as long as that level holds, the stock has some chance of moving higher and bouncing. However, any break of that level, this stock will take another beating until it is below $400.00.

Lastly, if Apple is able to break out of the current range, taking out $436.00, it will technically be free to run up to $455.00 then $485.00.

Gareth Soloway
InTheMoneyStocks

   [more]

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Early Selling Pressure In The Oil Service Stocks

March 11, 2013 – Comments (0) | RELATED TICKERS: HAL , RIG , SLB

This morning, many of the leading oil service stocks are coming under some selling pressure to start the day. One of the leading stocks in the industry group is Halliburton Co (NYSE:HAL). Today, HAL stock is trading lower by 0.30 cents to $41.78 a share. Short term traders should watch for intra-day support around the $41.50, and $41.18 levels. The daily chart of HAL stock is still holding up well. Should the stock decline further, traders should watch for daily chart support around the $38.00 area.

Some leading oil service stocks that are declining lower today include Transocean LTD (NYSE:RIG), Baker Hughes Incorporated (NYSE:BHI), Schlumberger Limited (NYSE:SLB), and Weatherford International Ltd (NYSE:WFT). Traders that are looking to track and trade the entire industry group can use the Market Vectors Oil Services ETF (NYSEARCA:OIH).
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Large Financial Stocks Hot: Too Big To Fail Now Even Bigger

March 07, 2013 – Comments (0) | RELATED TICKERS: JPM , GS , BBT

Market Mentality: Federal Reserve and government will always backstop the big financial players, buy like there is no tomorrow.

The feeling that institutions like JPMorgan Chase & Co. (NYSE:JPM) and Goldman Sachs Group, Inc. (NYSE:GS) are backed by the full faith and credit of the Federal Reserve and the government is alive and well. Just five years ago, these too big to fail banks were bailed out by the taxpayers. Since then they have gotten free money from the Federal Reserve to become even bigger. Many times members of congress, big wigs on Wall Street and the media have pounced on the fact that these banks are still too big to fail. Nothing has changed from 2007. Well, maybe one thing. They are even bigger now.

Recently, the small banks have started to complain. Regional banks like BB&T Corporation (NYSE:BBT) are having problems because they do not get the same special treatment as the "too big to fail" banks. They have a right to complain. The big institutions are even fatter now than they were in 2007 and the Federal Reserve keeps feeding them. Even this Dodd Frank bill put through congress is a joke. It was meant to reform these large banks but will barely have an impact. It can even be argued that the Federal Reserve gave these mega institutions special treatment in helps to avoid any issues stemming from the bill. In other words, kissing the ass of people like Jamie Dimon since they know these banks can take down the world overnight.

 As the Federal Reserve manipulates the system in an attempt to help the recovery, a new bubble is forming. Will these monstrously large, too big to fail banks withstand the coming collapse? The bond market bubble will crumble, the massive printing of currencies will bring on a mega hardship time for the middle class and poor as prices continue to climb. As I have said before, the Federal Reserve has been the main culprit in every major bubble in history. This is no different and will be the biggest one yet, even bigger than the financial crisis. Please note, there is no sign of collapse even starting until 2014.

Gareth SolowayInTheMoneyStocks  [more]

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Oil Service Stocks Send Mixed Signals

March 07, 2013 – Comments (0) | RELATED TICKERS: OIH

This morning, many of the leading oil service stocks are trading slightly higher on the session. Today, the popular and highly followed Market Vectors Oil Services ETF (NYSEARCA:OIH) is trading higher by just 0.02 cents to $42.37 a share. The current pattern on the daily chart of the OIH signals a potential move down to the $40.85 area, this level should be short term support for the OIH. Should that level fail to hold up the next daily chart support level for the OIH would be around the $39.30 area.

Day traders should watch for intra-day resistance around the $45.65, and $46.00 levels. If the OIH declines lower throughout the trading day the OIH will have intra-day support around the $42.00, and $41.75 levels.

Some other leading oil service stocks that are trading slightly higher today include Baker Hughes Incorporated (NYSE:BHI), Schlumberger Limited (NYSE:SLB), and Apache Corporation (NYSE:APA). These stocks could all be volatile over the next few trading sessions as the daily chart patterns seem to resemble the OIH very closely.

  [more]

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Scary: #1 Reason Analysts/Media Say Market Will Go Higher

March 06, 2013 – Comments (3)

The Dow Jones Industrial Average made a new all time high yesterday, hitting 14,253.77. Analysts on CNBC, Bloomberg and Fox Business News were cheering the run. A common question posed to members of the media and stock market analysts was whether the markets could continue to keep going higher, indefinitely. The majority said, 'yes'. When asked for the reasoning behind it, the main point was not valuations or technical analysis, it was purely "The Federal Reserve has backstopped this market. They started doing it in 2009 and will keep doing it for the foreseeable future. Therefore the markets will not go down.

This is probably one of the most scary statements ever made. To believe an entity, an independent bank, run by a group of men will never make a mistake is almost laughable. In history, the Federal Reserve has been responsible for every major bubble created. What makes them invincible now?

To give an example of the Federal Reserve creating the last major bubble, look at the Financial Collapse and Real Estate Bubble. This was created simply because of Federal Reserve intervention following the Technology Bubble collapse. To help the economy weather the massive technology collapse, the Federal Reserve lowered interest rates dramatically and encouraged the borrowing of money. This helped drive up home prices exponentially and encouraged the banks to take risky bets.

While I do believe the markets will continue to head higher in the near term, I think anyone believing the markets can never drop because the Federal Reserve will always be there to prop it up is smoking crack. They will and are causing the next big bubble. As the analysts and media pump this Federal Reserve safety net, the little investor is sure to go all in and be hurt the most. Sad but true. No entity run by a human being is ever infallible, especially an entity that has been wrong so many times in the past.  [more]

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Scary: #1 Reason Analysts/Media Say Market Will Go Higher

March 06, 2013 – Comments (0)

The Dow Jones Industrial Average made a new all time high yesterday, hitting 14,253.77. Analysts on CNBC, Bloomberg and Fox Business News were cheering the run. A common question posed to members of the media and stock market analysts was whether the markets could continue to keep going higher, indefinitely. The majority said, 'yes'. When asked for the reasoning behind it, the main point was not valuations or technical analysis, it was purely "The Federal Reserve has backstopped this market. They started doing it in 2009 and will keep doing it for the foreseeable future. Therefore the markets will not go down.

This is probably one of the most scary statements ever made. To believe an entity, an independent bank, run by a group of men will never make a mistake is almost laughable. In history, the Federal Reserve has been responsible for every major bubble created. What makes them invincible now?

To give an example of the Federal Reserve creating the last major bubble, look at the Financial Collapse and Real Estate Bubble. This was created simply because of Federal Reserve intervention following the Technology Bubble collapse. To help the economy weather the massive technology collapse, the Federal Reserve lowered interest rates dramatically and encouraged the borrowing of money. This helped drive up home prices exponentially and encouraged the banks to take risky bets.

While I do believe the markets will continue to head higher in the near term, I think anyone believing the markets can never drop because the Federal Reserve will always be there to prop it up is smoking crack. They will and are causing the next big bubble. As the analysts and media pump this Federal Reserve safety net, the little investor is sure to go all in and be hurt the most. Sad but true. No entity run by a human being is ever infallible, especially an entity that has been wrong so many times in the past.  [more]

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These Leading Stocks Are Not Rallying

March 05, 2013 – Comments (0)

This morning, the highly followed Dow Jones Industrial Average (DJIA) is making new all time highs. Traders and investors seem to be very euphoric as the easy money policies by the central banks continue to inflate the major stock indexes. The one problem with this rally is that there are a fair amount of market leading stocks that are not participating today, this could be a warning sign that this current stock rally is getting long in the tooth. 

Some of the leading stocks that are failing to participate in today's rally include LinkedIn Corp (NYSE:LNKD), Salesforce.com Inc (NYSE:CRM), Amazon.com Inc (NASDAQ:AMZN), and Netflix, Inc (NASDAQ:NFLX). Today's decline in these stocks could be simply just a pullback from an overbought condition, but it is still worth noting. When leading stocks fail to trade higher with the major stock indexes it is often a sign of problems on the horizon. Another weak group of stocks in today's session are the oil refinery stocks. Leading stocks such as Tesoro Corporation (NYSE:TSO), Valero Energy Corporation (NYSE:VLO), and Western Refining Inc (NYSE:WFN) are all weak reversing most of yesterday's gains.

Traders and investors continue to see the major stock indexes climb higher each and every week. The record low interest rates and easy money policies by the Federal Reserve continue to be implemented. This gives traders and investors the green light to continue to buy stocks at this time. Traders must now watch the market leading stocks for clues that the current liquidity driven market could start to lose steam.  [more]

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China Stocks Smashed As Real Estate Rules Clamp Down On Speculation

March 04, 2013 – Comments (0) | RELATED TICKERS: SINA , BIDU

The Shanghai Index took a beating to the tune of -3.7%, its worst drop since August 2011. This happened after the government introduced new housing restrictions including higher down payments and a 20% capital gains tax on real estate. Today, stocks like Baidu.com, Inc. (ADR) (NASDAQ:BIDU) and SINA Corp (NASDAQ:SINA) are taking a beating on this news. This news should be a global worry, as any forced slow down in China would create ripple effects around the world. In tune with this, the U.S. markets are slightly lower across the board.

Gareth Soloway
InTheMoneyStocks

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China Weighs On The Base Metals

March 04, 2013 – Comments (0)

This morning, many of the leading base and industrial metal stocks are declining lower at the start of the trading session. This important sector is highly affected by the Chinese economy and stock market. Last night, the important Shanghai Index finished lower by 3.67 percent. The decline occurred after the Chinese government announced a new 20 percent tax on any home that is sold. Remember, higher taxes are always a negative for markets.

One of the leading base metal stocks is Rio Tinto plc (ADR) (NYSE:RIO). Today, RIO is trading lower by $1.68 to $50.06 a share. Short term traders should watch for intra-day support around the $50.00, and $48.83 levels. The daily chart for RIO shows good support around the $47.00 level which is gap fill from late November 2012.

Some other leading base and industrial stocks that are also coming under selling pressure today include BHP Billiton Limited (ADR) (NYSE:BHP), Vale SA (ADR) (NYSE:VALE), and Teck Resources Ltd (USA) (NYSE:TCK). Traders should remember that the action in the U.S. Dollar Index will also impact these stocks from day to day.
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Pfizer Could Be What The Doctor Ordered

March 04, 2013 – Comments (0) | RELATED TICKERS: PFE , MRK , JNJ

The recent stock market rally is getting long in the tooth. Major stock indexes will only go so far in one direction before pulling back or staging a 7.0 to 10 percent correction. When stock indexes have run as far as they have recently, it makes it very difficult to pick stocks that can have further upside in the short term. However, in the stock market there is always opportunity around the corner. 

Pfizer Inc (NYSE:PFE) is one of the world's largest pharmaceutical companies. The PFE stock is one of the few leading stocks that is still signaling possible upside on the charts. Traders and investors can still look for another $3.00 points to the upside in this leading name. Currently, the stock is trading at $27.39 a share as of the close on March 1, 2013. Traders and investors can easily take note of the sideways basing pattern that the stock has been making on the charts since January 29, 2013. The pattern in place tells us that the stock should face a lot of daily and weekly chart resistance around the $30.00 level. Therefore, the stock still has some further upside in the cards. Should the stock reverse the current trend there should be some daily chart support around the $26.00 level. 

Pfizer Inc is one of three leading pharmaceutical stocks that is part of the Dow Jones Industrial Average(DJIA). The other two leading pharmaceutical stocks in the DJIA are Merck & Co Inc (NYSE:MRK), and Johnson & Johnson (NYSE:JNJ). PFE stock still looks better than these other two leading pharmaceutical stocks (MRK, JNJ) on the charts at this time. 

Nick Santiago
InTheMoneyStocks.com


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