Pre-market News And Views

The S&P 500 Index futures(ES M1) are trading higher by 2.00 points to 1304.25 per contract. Nearly every morning we see the futures trading higher before the opening bell at the New York Stock Exchange. At this time oil is trading lower by 0.83 cents to $103.16 a barrel and this could be helping the futures market this morning.

Last night the Asian markets were mixed. The Nikkei Index(Japan) was slightly lower trading down by 0.21 percent. The Hang Seng Index(Hong Kong) was flat closing lower by just 0.03 percent. The highly followed Shanghai Index(China) traded lower by 0.87 percent and this could effect the commodities market this morning. Often when the Shanghai Index rallies commodities will usually react positive on the news. The opposite effect is often true when the Shanghai Index closes down or lower.

Gold and silver are holding steady this morning trading basically flat. Recently gold and silver have traded in tandem with WTI oil. We shall see how long this relationship lasts as it has been closely tied to oil ever since the Middle East crisis.

At 9:00 am EST the Case-Schiller Home Price Index will be released for January. This report has had little effect on the stock market over the past few months. Right now the stock market has continued to climb the wall of worry on extremely light trading volume. As long as the trading volume remains light the markets could trade higher as there is simply a lack of selling pressure. At this time the Federal Reserve is still purchasing between $4 – 8 billion in U.S. Treasuries everyday which creates inflation and props the markets up once the agencies purchase stock with the money from the sale of the bonds. Traders must also watch for the consumer confidence report at 10:00 am EST. This report has been shrugged off recently and could be another non-event.

Nicholas Santiago
InTheMoneyStocks.com

This Could Be The Lightest Volume Day Of The Year

Where is the trading volume today? Yes, Monday’s are usually a lighter volume trading session, however, the volume today is simply ridiculous. Does anyone realize that there is a crisis in Japan, the Middle East , and in Europe. This market is being driven by computer algorithms today. The human hand has not been seen at all today. When the major stock indexes looked as if they had a chance of breaking down this afternoon the price of oil just dropped and helped the major stock indexes rebound a little. The trading volume on The SPDR Trust(NYSE:SPY) as of 2:55 pm EST is just 65 million shares. The three month average volume is 168 million shares a day. That means that today’s volume is nearly 100 million shares below the three month average.

Nicholas Santiago
InTheMoneyStocks.com

Stock Market Video: Fear Subsides On Middle East and Japan, But Portugal Near Collapse

The markets are holding the flat to positive side today as commodities are mostly lower. Fear seems to be out of the market as the Middle East and Japan are quieter. However, a major mess is unfolding in Portugal. Volume is on pace to be one of the lightest of 2011. Apple Inc. traded perfectly into gap fill and has stalled and oil stocks are mixed as oil trades lower. RIMM has a great head and shoulder pattern on the daily chart, though it is at support at the 200ma. Take the free trial to the Research Center and start getting the guidance the hedge funds pay millions for.

 

Pre-market News And Views

This morning the S&P 500 e-mini futures(ES M1) are trading higher by 1.50 to 1311.50 per contract. This slight move higher in futures comes as WTI oil is trading lower this morning $1.33 to $104.12 a barrel. Over the past few weeks, whenever WTI oil has declined the major stock market indexes have climbed sharply higher. This morning it appears the S&P 500 futures look to be struggling to remain positive ahead of the opening bell at the New York Stock Exchange.

Nothing has really changed in the Middle East as violence and protests remain high. Qatar has agreed to purchase oil from Libya that is now controlled by the rebels. This is the likely reason for the decline oil before the opening bell. Traders and investors must continue to follow the Middle East and North Africa very closely for any new uprisings or disruptions as oil will usually move higher on this type of news.

Personal spending and income increased this morning. Spending was higher by 0.07 percent, meanwhile, income was higher by 0.03 percent. This number is not having a major effect on the stock futures and that is what traders concern themselves with.

The Asian markets were mixed last night. The Nikkei Index(Japan) traded lower by 0.60 percent as the Nuclear reactor crisis remains front and center. The problems in Japan still remains and must continued to be watched closely as radiation levels remain high. The Shanghai Index(China) was higher by 0.21 percent and this should not have much effect on our markets in the United States this morning.

The Pending Homes Sales Index will be released at 10:00 am EST. Most of the recent economic data released has not had much of an effect on the market lately and I’m not sure how much this report will have. The major stock market indexes have continued to rally despite all of the negative news and that must be respected. These major market indexes are getting a bit overbought short term at this time.

Gold and Silver are declining lower this morning. It seems as if gold and silver are trading almost in lockstep with oil. Therefore, traders must keep one eye on oil at all times.

Please do not forget about the European debt crisis. Ireland, Portugal, and Spain, are still in focus despite having little effect on the markets recently.

Nicholas Santiago
InTheMoneyStocks.com

The VIX Drops Again Signaling A No Fear Market

The Market Volatility Index(VIX) has declined by 13.00 points since making its recent high on March 16, 2011 at $31.28. When the VIX declines it is a sign that the market volatility has declined. Many investors and traders will use the VIX as a fear gauge for the stock markets. Often traders will add risk when the VIX declines as there is very little fear. Smart and savvy traders may want to buy VIX contracts as protection when the VIX declines so sharp and so suddenly. When the VIX declines the major stock indexes will usually trade higher. The opposite is true when the VIX jumps or trades higher the major stock indexes will decline. The all time high for the VIX was in October 2008 when the VIX traded at $89.53.

Nicholas Santiago
InTheMoneyStocks.com

Stocks To Watch If Nevada Legalizes Online Gaming

Today, Nevada will decide whether or not to allow online poker to become legal. This would be the first state to pass such a measure and could start a domino effect in other states. Currently, millions of people gamble online every day but through outside sources since it is illegal in the United States. Therefore the States and Federal Government are left flat when it comes to taxing these profits. It is said they are missing out on billions in revenue by lack of taxes. When almost all states are facing possible bankruptcy due to huge deficits, it is an obvious course of action to legalize it.

Small cap stocks that could benefit from this course of action will be CryptoLogic Limited (NASDAQ:CRYP) as well as PokerTek, Inc. (NASDAQ:PTEKD) and even possibly GigaMedia Limited (NASDAQ:GIGM).

Origionally, the large casinos like Las Vegas Sands Corp. (NYSE:LVS) and Wynn Resorts, Limited (NASDAQ:WYNN) were against online gaming because they feared it would take massive business away from them. However, since it appears millions do it anyways, they are now realizing that they could get involved and profit from it as well. The key is to regulate it appropriately. If done correctly, not only could States get a boost of revenue from taxes, but also more profits to the casinos.  Watch for the vote later today in Nevada.

Gareth Soloway
InTheMoneyStocks.com

Key Stocks Gap Into Solid Resistance, What It Means

Not only did the markets gap into the 20 and the 50 moving average today, but many leading stocks did as well. This tells smart traders that Wall Street may struggle a little in the next few days while it consolidates below this level. So far the markets pulled off this resistance level all the way to the flat line before bouncing back a little.

Some of the major stocks that opened higher but into resistance were Google Inc. (NASDAQ:GOOG), which opened into the daily 20 moving average and International Business Machines Corp. (NYSE:IBM) which into the 20 and 50 moving average. Again, the key here is to recognize that leading stocks are hitting resistance ranges just as the markets are doing the same. This basically means that traders are now moving from a bullish bias over the last week to a more neutral or neutral to small negative bias.

Reading the charts is the number one thing any successful trader does. The charts tell the whole story while the media and fundamentals only tell half. Learn the charts and profit.

Gareth Soloway
InTheMoneyStocks.com

Alert: Master Levels On Apple For The Day

Apple Inc. (NASDAQ:AAPL) has been on a wild ride over the last month. On February 16th, 2011, Apple made an all time high at $364.90. Since then, things have started to fall apart. The stock has plummeted to a recent low of $326.26 as the market has had a small correction and the brain, Steve Jobs took a leave of absence.

As the markets have rebounded over the last week, Apple has also had a decent bounce back. Today it is trading at $340.13 +0.94 (+0.28%). Below, are are all the master levels for Apple during the trading day. Each resistance level should be a solid short while each support should be a great quick long scalp.

Gareth Soloway
InTheMoneyStocks.com

Markets Gap Into Resistance

The SPDR S&P 500 ETF (NYSE:SPY) opened sharply higher today on the back of continued optimism on the global economy. Things remain somewhat quiet in the Middle East, Japan and even Europe. The markets have adapted to the craziness of the last month and at this point, unless something new happens, the markets seem to be in rally mode again.

The SPY opened higher at $130.40, just below a major neck tie resistance point on the daily chart. This level is made up of the 20 moving average and the 50 moving average. In the short term this may keep the markets from breaking higher.

One of the other positives for today in the market is Best Buy Co., Inc. (NYSE:BBY). Best Buy reported better than expected earnings this morning and is sharply higher. Durable goods orders and jobless claims were also reported approximately in line with estimates.

Gareth Soloway
InTheMoneyStocks.com

The Apple May Fall Far From The Tree

As Steve Jobs continues to become less and less of an impact player at Apple Inc. (NASDAQ:AAPL), whisperings on Wall Street have started. Institutional players and big hedge funds seem to be questioning the ability for Apple to continue to grow at such a quick pace. This growth rate has given it the price to earnings multiple it currently holds. The quiet talk has been something that has built up since Steve Jobs took his second leave of absence from the company in recent months but is only partially a result of his departure.

Throughout history, companies have gone into mega growth momentum phases. Look back at stocks like Microsoft Corporation (NASDAQ:MSFT) and Cisco Systems, Inc. (NASDAQ:CSCO). These stocks had their golden years where they were the talk of the town. Everyone owned them and thought the good times would never end. However, inevitably, the good times always end. This is two fold. First, the larger you become, the harder it is to grow at the same rate as previous years. Doubling your size when you are a $100 million company is a lot easier than when you are a $100 billion company. Secondly, every other company in the sector targets you as a leader, copies you and tries to one up you. As the competition pushes faster and harder, it is almost impossible for the leader to not stumble. One miss step by management and you are the old maid.

As the iPhone is amazing, the Droid is right there. As the iPad is a work of art, many companies already have competing products on the market which are nearly as good, if not just as good. Price wars begin, margins drop and ultimately stock price falls. This is the cycle of life as a mega growth company.

This talk has been increasing since the departure of Steve Jobs. Part of it obviously has to do with him being the brain of Apple now absent. However, the other half is definitely the mega company syndrome. It looks like many large institutions and hedge funds have started to unload their Apple positions. While they still hold Apple, a distribution of sorts has been increasing as they sell into the retail investor. This can clearly be seen in the stock price as it has stalled out and created an M top. This type of top is usually bearish and smells of distribution by the big boys.

While Apple will remain a leader for years to come, investors must start to wonder if their fate may be sealed like that of Microsoft and Cisco. Microsoft ran to $60 per share in 2000 only to fall back to the $20 – $30 range for the last ten years. Could this be the fate of Apple?

Gareth Soloway
InTheMoneyStocks.com