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Market Commentary

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The Next Big Wave Is Building

Housing and labor posted good numbers today , but what seems to interest the market more is the inflation data that came out today.

  • Underlying inflation pressures pushed higher in October, even as falling gasoline prices kept overall U.S. consumer prices in check.
  • The Labor Department said on Thursday its so-called core Consumer Price Index, which excludes food and energy, rose 0.2 percent, the largest increase in five months, after nudging up 0.1 percent in September.
  • In the 12 months throug...
Nov 20, 2014
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Positive Data, Buy The January E-mini S&P 500

Thursday morning brought a few more bits of positive data for the U.S. economy. Jobless Claims came in down 2,000 from the week prior at 291,000. For ten straight weeks, Jobless Claims have been under 300,000, a sign that the labor market is continuing to improve. The better number may be 73,000. That is the amount that continuing claims dropped, to 2.33 million the lowest level since late 2000.

Its déjà vu all over again, as Yogi Berra once said. Investors and traders will be looking at how ...

Nov 20, 2014
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Take The Trading Challenge and Win

In trading, as in the long race, the turtle consistently beats the hare.

In last week’s article about overtrading, I noted that in a study of 66,000 active traders, only those whose trading frequency was in the bottom quintile , were able to beat the S&P 500.

In active trading, why would less be so much more? Brain research on peak performance in athletes points us toward an interesting answer.

Trading, AnExtreme Sport?

Most coaches advise their clients to approach trading as a business. This...

Nov 20, 2014
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Call Buyers Bet On New Highs In Tyson Food

Tyson Foods , a $16B food production and distribution company, announced on November 19th at the Morgan Stanley Global Consumer and Retail Conference they expect to see adjusted 2015 EPS of $3.30-$3.40 per share . The company said they are optimistic 2015 will be a record year for earnings and revenue . Synergies from the Hillshire Brands deal earlier this year are expected to top $225M next year.

Using the high end of the EPS projections the stock trades at a P/E ratio of 12.70x with 15.6% E...

Nov 20, 2014
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January Soybean Futures: Trading Idea November 20, 2014

January Soybean Futures a Selling Opportunity on More Price Weakness

See on the daily bar chart for January soybeans that prices have backed well down from the recent high, including negating a near-term price uptrend. A move in prices below major psychological support at $10.00 would give the bears better downside momentum and it would also become a selling opportunity. The downside price objective would be $9.20 or below. Technical resistance, for which to place a protective buy stop just ...

Nov 20, 2014
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Featured Stories

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Playing Precious Metals And Not Losing Your Shirt

The precious metals markets, namely gold and silver, offer traders the allure of large profits.  However, high margins and unpredictable volatility are often too much for the average retail trader to handle.  Likewise, using unleveraged alternatives, such as the ETF, GLD, forces traders to face other obstacles, including inefficient price movement and hidden costs.  There are some alternative lower risk products available to those interested in dipping their toe into metals trading, but there...

Nov 18, 2014
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Track The Dark Pools With The Balance Of Power (BOP) Indicator

The most challenging aspect of the automated-order marketplace is to find an indicator that can reveal where the Dark Pools are accumulating a stock over time, and which stocks they are quietly rotating out of to lower their held shares of a required chartered stock.

Rotation and accumulation are hidden these days on Dark Pool venues that do not show the huge lot orders moving through the automated system. Before the year 2005, giant lot orders were either handled by market makers on the exch...

Nov 11, 2014
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The Consumer May Be Feeling Better this Holiday Season

The holiday season is just around the corner. Traders and economic watchers will be closely watching the Retail Sector given the dismal turnout by consumers in recent years. The XRT peaked in 2013 and since has traded sideways, until today.  There are clues that this year may be a different season for both the consumer and retailers alike, and traders will be following the XRT to signal a breakout.

 Figure 1, Weekly Chart of the XRT


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Lower Prices at the Pump

Beginning mid-summer, consumers...

Nov 10, 2014
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Growing CRO Industry & Acquisition of Covance (CVD) Put INC Research IPO in Spotlight

In a very busy week for IPOs, one deal that stands out from the pack is INC Research , a Contract Research Organization that solely focuses on conducting Phase 1 to Phase 4 clinical trials for biopharmaceutical and medical device companies.

Its 8.1 million share IPO is expected to price on November 6 within a range of $17-$20, and then open for trading the following morning.

There are a few primary aspects to this deal that caught my attention. First, from a fundamental perspective, the comp...

Nov 5, 2014
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The Indian Rupee And The Euro Carry Trade

Since the beginning of this year, the Indian rupee has rallied 8% against the euro after hitting a record low of INR/Euro 85. Investors bought rupees amid a renewed confidence in the newly-elected Modi government, while selling euros, as the European Central Bank gets ready to implement its quantitative easing policy.

Our analysis suggests the INR/Euro exchange rate will rally to 70-to-1 over the next two years, from 77-to-1 today. Given this, we recommend a long position in the rupee, funded...

Nov 5, 2014
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