The Red Roadmaster’s Technical Report on the US Major Market Indices + ™

Featuring Crude Oil, Gold, and Forex Technical Up-date s

Vol. 02282011 # 1 Copyright 28 February 2011 Date Line: Singapore

The Red Roadmaster™

Paul A. Ebeling, Jnr. Editor/Compiler/Analyst/Commentator

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28 February 2011 6.00 am US EDT

Dear Reader,

You can read my Market Reports, and Up to Date International News daily and weekly on www.livetradingnews.com , www.paulebeling.com , www.aseanaffairs.com and www.pinnacledigest.com as I round up relevant global market news and technical analysis up-dated daily. + You can see many of my articles and commentary on Google News http//news.google.com/news/search?aq=f&pz=1&cf=all&ned=us&hl=en&q=paul+ebeling + seen on ASEAN Affairs www.aseanaffairs.com

Red’s Bull and Bear Trade and Options Alerts

Red's Options Alert: Apache Corp. (NYSE:APA) 

Red’s Bull Trade “Breakaway” Alert: True Religion Apparel, Inc. (NASDAQ:TRLG)

See them all at www.livetradingnews.com, www.ebeling-heffernan.com , www.paulebeling.com, www.aseanaffairs.com and www.redroadmaster.com

Re-cap of the US Markets for the Week ended 25 February 2011

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Red's Bull Trader Alert: Players moved in after watching the broader market fall more than 2% during the prior session. Although headline risk related to social, and political chaos in the Middle East, and North Africa continues, the flow of news out of the region has been less unsettling. That had the effect of dropping the Volatility Index, often dubbed the Fear Gauge, for a 9.9% loss to 19.22, falling below 20 after 3 days of gains.

All 10 of the US market's major sectors posted gains in Friday’s session, but financials and materials were the best performers. They both marked 1.4% gainers.

US stocks rose Friday, bouncing back from a week-long sell-off as worries about Crude Oil supplies faded and prices stabilized.

The S&P 500 is down 1.9% on the week. The S&P closed well off its lows Thursday.

Global markets were pressured during the week by worries that chaos in Libya could spread to other major Crude Oil producing countries, causing energy prices to rise at the expense of the Global economic recovery.

On the Day: the DJIA .DJI rose 61.95 pts, or 0.51, at 12,130.45, the S&P 500  .SPX gained 13.78 pts, or 1.06%, at 1,319.88, and he NAS .IXIC tallied up a + 43.15 pts, or 1.58%, at 2,781.05.

On the Week: The S&P 500 lost 1.7% breaking 3 wks of gainers, the DJIA fell 2.1%, and the NAS declined 1.9%.

Q-4 GDP was revised downward to reflect growth of 2.8% after the advance reading showed a 3.2% growth rate. Economists had expected, on average, growth of 3.3%. Despite the surprisingly large downward revision, players continued to buy stocks.

The final Consumer Sentiment Survey for February from the University of Michigan bolstered buying. It came in at 77.5, which is the best reading since January 2008.

Corporate news was still of little overall concern, but it caused some stock-specific swings. Autodesk (NASDAQ:ADSK) 42.75, +2.32, staged one of the Strongest moves after it posted better-than-expected earnings.

Gap (NYSE:GPS) 22.75, +0.26, and J C Penney (NYSE:JCP) 34.16, -2.39 posted upside earnings surprises of their, and announced share repurchase plans. Gap announced a dividend hike.

Retailers advanced 0.3%.

Among top boosts to the NAS were shares of Intel (NASDAQ:INTC), up 2.7% at 21.86. Longbow started coverage of the company with a "buy" rating.

A semiconductor index .SOX rose 2.6%

In other Company news, Boeing Co (NYSE:BA) shares rose 2.2% to 72.30 and led the DJIA higher after the US aircraft maker won a US$30B contract to build 179 US Air Force refueling planes.

Financial and material sectors led the S&P 500's gains, with shares of JPMorgan Chase (NYSE:JPM) up 1.7% at 46.68.

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Some of the widely watched commodities put on a mixed performance Friday, but the CRB Commodity Index posed a 1.6% gainer, its best single-session performance in more than a month.

Crude Oil futures prices were less volatile than they have been in the past few of days. After a couple of pullbacks to the Neutral line the energy component managed to settle at 97.97 bbl with a 0.7% gainer.

Nat Gas had an impressive session. The commodity closed 3.5% higher at 4.01 per MMBtu.

Gold prices finished pit trade lower at 1409.70 oz. and Silver fell 0.5% to settle pit trade at 33.01 oz.

Cotton futures were lock limit up to trade at 1.84 per pound after their prices fell in each of the past 4 sessions.

9 of the 10 equity sectors fell: the cyclical sectors industrials (-3.3%) and materials (-3.0%) under performed.

Volume: Trade was a low 7B/shrs traded on the NYSE, AMEX and NAS, below last year's daily average of 8.47b/shrs.

Index Started Week Ended Week Change % Change YTD %

DJIA 12391.25 12130.45 -260.80 -2.1 4.8

NAS 2833.95 2781.05 -52.90 -1.9 4.8

S&P 500 1343.01 1319.88 -23.13 -1.7 4.9

Russell 2000 834.82 821.95 -12.87 -1.5 4.9

                                US Major Market Indexes Technical Analysis

Date Symbol Price Technical Analysis Support Resistance

Feb-25-2011 QQQQ 57.65 Bullish (0.47) 57.11 58.06

Feb-25-2011 DIA 121.14 Bullish (0.34) 118.78 136.93

Feb-25-2011 SPY 132.33 Bullish (0.40) 131.78 135.25

The World Market Closing Numbers

DJIA 12132.60 +64.14 +0.53%S&P 500 1319.99 +13.89 +1.06%NAS 2780.87 +42.97 +1.57%S&P/TSX 14052.10 +184.82 +1.33%Mexico Bolsa 36855.30 +408.74 +1.12%Brazil Bovespa 67002.50 +53.53 +0.08%STOXX 50 2985.02 +35.89 +1.22%FTSE 100 6001.20 +81.22 +1.37%

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CAC 40 4070.38 +60.74 +1.51%DAX 7185.17 +54.67 +0.77%FTSE MIB 22349.70 +400.98 +1.83%Nikkei 10526.80 +74.05 +0.71%TOPIX 941.93 +7.71 +0.83%Hang Seng 23012.40 +411.33 +1.82%S&P/ASX 200 4836.50 +27.20 +0.57%Shanghai 2878.56 -0.04 -0.00%

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Red's Options Alert: Apache Corp. (NYSE:APA) 

  My Options Alert filter saw an unusual volume of APA options activity Friday. A total of 2,462 Put and 9,933 Call contracts traded raising a low Put/Call volume alert. Today's traded Put/Call ratio is 0.25, meaning that there were 4.03 Calls traded for each Put contract.

The Unusual Trading Action

Note: A significant increase in the trade of a stock's options often is an indicator of movement in the underlying stock. As such, the Put/Call Ratio is often used as an investor Sentiment Indicator, where a high ratio implies that the overall investor sentiment is Bearish, and a low Put/Call ratio implies that the overall sentiment is Bullish.

Shares of Apache Corp. gained 3.03 (+2.51%) to close the session at 123.53.  The stock closed at 120.50 in the prior trading session, and opened Friday at 120.99.  The price of the stock traded between a low of 120.50 and 123.53.  Volume: 3,399,650/shrs, is just above the 90 day average volume of 3,382,730/shrs.  APA is trading above its 50 and 200 day moving averages.  The stock's 52-week low is 81.94 and 52 week high is 127.73. The stock has a P/E ratio of 14.60; EPS is 8.46, and a Div & Yield of 0.60 (0.50%).

Price Performance Metrics for Apache Corp: Wk: 2.41% Mo: 1.17% Q: 14.03% 6 Mo: 41.89% Yr: 19.89%  

Analysis Overall Short Intermediate     LongNeutral (0.20) Neutral (0.14) Bullish (0.42) Neutral (0.06)

  Recent CandleStick Analysis    Neutral Open GapsDirection Date       RangeUp 1 Dec 2010 108.7 to 109.67Up 4 Nov 2010 103.42 to 105.18 Support and ResistanceType Value Conf.resist. 127.56 2

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supp 122.91 4supp 121.16 5supp 119.48 7supp 115.86 4supp 114.70 2supp 110.31 4supp 106.35 2supp 105.01 3supp 99.41 2  1yr Price Target Estimate 139.80

Red’s Bull Trade “Breakaway” Alert: True Religion Apparel, Inc. (NASDAQ:TRLG)

 LTN's Pattern Recognition Analyst, Paul A. Ebeling, Jnr, ID'd a Bullish Breakaway Alert for True Religion Apparel, Inc Shares of TRLG closed Thursday 21.06, and opened Friday at 22.68.   TRLG closed the session Friday + 4.01 (19.04%) at 25.07

The price range Friday was between 22.50, and 25.10.

Volume: 2,717,846/shrs is almost 8 times higher than the 3 mo average volume of 395,735/shrs. 

TRGL is trading above its 50 and 200 Day Moving Averages.

My Technical Indicators augur continuing Bullish action in here on the Gap Open Up Friday (Breakaway Gap?).

The stock's 52-week low is 17.50, and 52 week high is 34.17, its P/E ratio is 14.83, and its EPS is 1.69.

 

Analysis Overall Short Intermediate LongBullish (0.40) Bullish (0.44) Bullish (0.48) Bullish (0.28)

 Recent CandleStick Analysis  NeutralDate Candle22 Feb  2011    DOJI  Open GapsDirection Date RangeUp 25 Feb 2011 21.19 to 22.5  Support and ResistanceType Value Conf.resis  NIL  

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supp 24.02 2supp 23.42 2supp 22.89 2supp 22.49 3supp 21.52 16supp 19.99 6supp 18.25 2 1 yr Price Target Estimate: 36.50 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

February 28th   Monday

Personal Income, January (08:30): 0.3% expected, 0.4% past

Personal Spending, January (08:30): 0.4% expected, 0.7% past

PCE Prices - Core, January (08:30): 0.1% expected, 0.0% past

Chicago PMI, February (09:45): 67.5 expected, 68.8 past 

Pending Home Sales, December (10:00): -3.2% expected, 2.0% past

March 1st Tuesday

Construction Spending, January (10:00): -0.6% expected, -2.5% past

ISM Index, February (10:00): 60.5 expected, 60.8 past

Auto Sales, March (15:00): 3.95M past

Truck Sales, March (15:00): 5.64M past

March 2nd Wednesday

MBA Mortgage Index, 02/25 (07:00): +13.2% past

Challenger Job Cuts, February (07:30): -46.1% past

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ADP Employment Change, February (08:15): 163K expected, 187K past

Crude Oil Inventories, 02/26 (10:30): 0.822M past

March 3rd Thursday

Initial Claims, 02/26 (08:30): 400K expected, 391K past

Continuing Claims, 02/19 (08:30): 3800K expected, 3790K past

Productivity-Rev., Q-4 (08:30): 2.3% expected, 2.6% past

Unit Labor Costs - R, Q-4 (08:30): -0.3% expected, -0.6% past

ISM Services, February (10:00): 59.0 expected, 59.4 past

March 4th Friday

Nonfarm Payrolls, February (08:30): 180K expected, 36K past

Nonfarm Private Payrolls, February (08:30): 193K expected, 50K past

Unemployment Rate, February (08:30): 9.1% expected, 9.0% past

Average Workweek, February (08:30): 34.3 expected, 34.2 past

Hourly Earnings, February (08:30): 0.2% expected, 0.4% past

Factory Orders, January (10:00): 2.1% expected, 0.2% past

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This Week on the Earnings Front in the USA

Earnings season has come to an end once again, there are still some important company reports to go this week, and this week there are no DJIA components on the calendar, but there are several big stocks that can move their underlying sectors. 

                                    DNDN, JOE, COST, KR, and MRVL

I am watching these: Denderon Corporation (NASDAQ:DNDN), St. Joe Company (NYSE:JOE), Costco Wholesale Corporation (NASDAQ: COST), Staples, Inc. (NASDAQ: SPLS), Big Lots Inc. (NYSE: BIG), The Kroger Company (NYSE: KR), Marvell Technology Group, Ltd. (NASDAQ:MRVL)

On Tuesday: Dendreon Corporation (NASDAQ: DNDN), St. Joe Company (NYSE:JOE)  after the close.

On Wednesday: in the morning Costco Wholesale Corporation (NASDAQ: COST), and Staples, Inc. (NASDAQ: SPLS).

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On Thursday: in the morning Big Lots Inc. (NYSE: BIG), and The Kroger Company (NYSE: KR). After the Bell Marvell Technology Group, Ltd. (NASDAQ: MRVL) reports. 

See the complete list for the week at: http://biz.yahoo.com/research/earncal/20110228.html

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The Most Asked Question Last Week

The Big Q: Red, What are "Whisper Numbers"?

 The Big A:  Last week a reader send me an email asking, Red, What are "Whisper Numbers"?

The Whisper Number is not an indication that a Company will report Strong or Weak earnings.

 It is an "expectation number" of what analysts and players believe a Company will report.

 The big difference is between "knowing" and "expecting."

 No one but the Company knows what it will report, but many folks have "expectations" of what a Company will report.

And it is "expectation" that move markets. When a Company reports earnings that beat the "Whisper Number" expectation, it provides the market with a very positive buy attitude.

And when a Company misses the "expectation," it provides the market with a negative sell attitude.

Not all Companies react as expected to "beating" or "missing" the "Whisper Number."

There are a number of Big name Companies that get lots of attention when they report earnings. The hype surrounding can make one feel if he/her is missing out on an exciting opportunity.

Microsoft (NASDAQ:MSFT) is a good example of a Company that the savvy player ignores around earnings season.

A player has to learn which Companies are likely to see strength when they beat the "Whisper Number", and which ones are most likely to see weakness when they miss.  To do that requires access to information on the Companies whose prices show a high correlation to their earnings reports up or down. Without that knowledge, the market will quickly swallow the unschooled "bet."  Knowledge is Power! ---Paul A. Ebeling, Jnr. www.livetradingnews.com .

Remember, the Trend is Your Friend, but it is also important to be ever alert and nimble and always take what the market gives.

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Red’s Edge and in the Trenches

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Reflect and Resolve: 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

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The Key to Stock Market Understanding

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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.

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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 comes the Risk factor that gives 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.

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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.

Again, think Education First.

For news and information please go to www.livetradingnews.com, www.paulebeling.com and www.ebeling-heffernan.com , www.aseanaffairs.com sign up for RSS feeds on the latest US Market News, ASEAN and World News, Twitter, and the Hot List, it’s Free

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 Quote of the Week: "Our purpose is hidden in our joy, our inspiration, our excitement. As we act on what shows up in our life our purpose shows up." -- James King ___________________________________________________________________________________

In View: Restoring growth, improving competitiveness is a priority for Europe

 Europe needs a stronger focus on rebuilding competitiveness to restore growth and create new jobs, Antonio Borges, director for Europe of the International Monetary Fund (IMF), said Friday.

"Clearly we need the financial system, and the banking sector in particular, to go back to its normal function of supporting economic activity and channeling savings to investment. All of this is now reverting back to normal, but at a pace that could be reversed if there were to be surprises," Borges told IMF Survey Magazine that is released Friday on IMF's website.

He held that in the EuroZone, the Key problem is that many of the countries facing difficulties currently are those that experienced almost an illusion of economic growth, growth that could not be sustained. "A

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high level of spending was financed through foreign borrowing, which benefited some of their local firms, but it was not sustainable."

For countries that are not in the euro zone, deeper economic integration will yield benefits by encouraging a more efficient allocation of resources and using the broader European market to spur more growth, Borges added.

"On the one hand, as everybody knows, we still need to work through the sovereign debt crisis and address the systemic risks associated with it. On the other hand, there is, in parallel, a real revolution in terms of the new regulatory framework that is being implemented by the European Union," he said.---Paul A. Ebeling, Jnr.  www.livetradingnews.com

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Hot Topics

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

Luxury from Middle East Chaos 

The chaotic events in the Middle East may ultimately be a bonus to the luxury goods industry

The events unfolding in the Arab countries, and the rise in the price of Crude Oil, are being watched carefully by manufacturers and retailers now in Italy for fashion week.

Most agree that the fall of dictators is seen as good news at the highest management levels. The potential growth of a middle class, in countries where the rich are the minority, is likely very positive for consumerism in the long run.

“This is a whole area of the world that missed the beat for the last 80 yrs, but for the future of the global economy, so let us hope it goes in the direction of China and not Iran,” said Michael Burke, Chief Executive of Fendi, part of the LVMH Moët Hennessy Louis Vuitton luxury conglomerate.

“This could be the best news since Y 1978, when China decided to go with the market economy,” said Mr. Burke, noting that in Egypt, a country of almost 83M people, he does not have one Fendi product for sale, even though its wealthy elite has bought into luxury.

Diego Della Valle, Chairman and Chief Executive of Tod’s group of leather companies, says there are too many imponderables at the moment to talk about “Good News” for the industry. He specifically cited the unknown result should the flow of refugees across the Mediterranean to Italy ignite social unrest.

“Maybe, after 10 or 20 yrs, we will see an advantage,” said Della Valle. “It depends on what happens and whether people get back to work. It is important to understand how quickly things are changing. I was in Egypt in early January, and I could never have imagined what has happened there since.”

Sidney Toledano, Chief Executive of Christian Dior in Paris, put it this way. “What we like is stability,” he said. “We want to go into countries where there is a Middle Class, and where we see immediate potential.”

Dior recently opened a shop in Morocco, a country that Mr. Toledano views favorably, with plans for a store in Casablanca to join the one in Marrakesh.

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Tomaso Galli, a consultant in brand management, also cited Morocco as “the most progressive, in spite of being a Kingdom.”  “The moment that other countries like Egypt open up,” Mr. Galli said, “there is no reason why luxury brands should not develop. Maybe not just in 20 yrs. It could be a lot faster.” He recommended a “wait and see” policy toward democracy, and the opening up of new markets.

For John Hooks, Deputy Chairman and Director at Giorgio Armani, the Middle East is not new territory, with Dubai the home of the 1st Armani hotel, and with the brand’s strong presence in the Gulf region.

“Until the present disturbances, the 3 major factors that have determined the evolution of the market have been the price of Crude Oil, the generational change in the ruling class, and the demographic explosion,” said Mr. Hooks, explaining that with those changes came greater spending power, a new Western-educated elite, and a lot of young people.

Therefore, over the last 4 yrs the Company opened 15 A/X Armani Exchange and Emporio stores in Bahrain, Lebanon, Qatar, Saudi Arabia and the United Arab Emirates.

Mr. Hooks said that Armani, which sells only through multi-brand stores in Cairo, Casablanca and Tunis, had planned to open its own boutiques in Egypt and Morocco, but that those are now on hold.

“I myself was very impressed by the new towns that are growing up in the Maghreb, such as the area known as ‘New Cairo’ and the prosperous suburbs of Marrakesh and Casablanca,” Mr. Hooks said. “These are not just gated communities, but evidence of a significant and expanding Middle Class.

“This Middle Class is the real driving force behind these uprisings, particularly in Egypt and Tunisia, and this augurs well for a quick return to economic stability and even accelerated development IMO. ---Paul A. Ebeling, Jnr.   www.livetradingnews.com

Thousands march on Wisconsin’s Capitol

Thousands of demonstrators marched on Wisconsin's state Capitol Saturday to protest Republican Gov. Scott Walker's plan to curb public sector union power in order to balance the budget.

Waving American flags, and singing the National Anthem, the demonstrators were peaceful and the crowds upbeat despite a setback earlier in the week when the state Assembly approved the measure over Democratic objections.

What began 2 wks ago as a Republican measure in one small US state, has turned into what could be the biggest challenge to union power since then-President Ronald Reagan fired striking air traffic controllers nearly 30 yrs ago.

If Republicans prevail in Wisconsin, a number of other US States governed by conservative majorities could follow. Already, other legislatures including Ohio, Indiana, Iowa, Idaho, Tennessee, and Kansas are working on union curbs.

Unlike previous protests, the rally Saturday brought out thousands of union workers not directly affected by the bill, including the state's firefighters, exempted along with police from the Republican proposal. Dozens of private sector unions were represented as well.

The stakes are high for labor because more than a 33% of public employees; teachers, police and civil service workers belong to unions while only 6.9% of private sector workers are unionized. Unions are the biggest single source of funding for the Democratic Party.

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US labor groups also staged rallies across the country to show solidarity with Wisconsin in fighting the proposal they see as trying to break the union movement in the USA---Paul A. Ebeling, Jnr.  www.livetradingnews.com  

Warren Buffett optimistic about the future of the USA

US billionaire, Warren Buffett, wants Americans to be optimistic about the Country's future, but careful about borrowing money, and the games public companies play with profit numbers they report.

Buffett said in his annual letter to Berkshire Hathaway shareholders Saturday that he still believes America's best days are ahead.

"Commentators today often talk of 'great uncertainty.' But think back, for example, to December 6, 1941, October 18, 1987 and September 10, 2001," Buffett wrote, referring to the days before the Pearl Harbor attack, a stock market crash and terrorist attacks in the US. "No matter how serene today may be, tomorrow is always uncertain. Don't let that reality spook you." He said a housing recovery will likely begin within the next year.

Buffett's letter detailed how the acquisition of Burlington Northern Santa Fe railroad, better results at Berkshire's other subsidiaries and strong investment performance combined to boost the company's net income by 61% to US$12.97B in Y 2010.

But Mr. Buffett also said in his message that it is important to educate investors on Key business principles. Buffett said the financial crisis of Y 2008 confirmed the dangers of investing with borrowed money because even a short absence of credit can ruin a company.

"When leverage works, it magnifies your gains. Your spouse thinks you're clever, and your neighbors get envious. But leverage is addictive," Buffett said. "Once having profited from its wonders, very few people retreat to more conservative practices."

That's part of why Berkshire always keeps at least US$20B in cash on hand for unforeseen events or investment opportunities, he said. At the end of Y 2010, its cash reserve totaled US$38B.

Mr. Buffett also offered Berkshire shareholders few new details about how the Company will function once he is no longer at the helm.

The 80 year-old Chairman and CEO of Berkshire said that investment manager Todd Combs will manage US$1 to 3B of Berkshire's US$158B investment portfolio.

Berkshire hired Combs last fall, and Buffett says Combs has the risk aversion, dedication and track record he wants in an investment manager.

To replace Buffett, Berkshire plans to split his job into 3 parts: Chief Executive Officer, Chairman, and several Investment Managers.

Mr. Buffett has indicated that he has no plans to retire, and he says he loves his work and remains in good health.

Many people speculate that David Sokol, who is Chairman of NetJets and MidAmerican Energy, is the leading candidate to be Berkshire's next CEO.

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But several other Berkshire managers have been mentioned as possible Chief Executives, including: Ajit Jain, who runs Berkshire's re-insurance division; Tony Nicely, Chief Executive of Berkshire subsidiary Geico; and BNSF CEO Matt Rose.

Buffett praised all those managers in his letter Saturday. ---Paul A. Ebeling, Jnr.  www.livetradingnews.com  

M&A in the USA: Family Dollar takeover looks doomed as fall below Peltz bid

Family Dollar Stores Inc.(NYSE:FDO), which billionaire investor Nelson Peltz offered to buy for US$7.7B, is the most likely to fail among Y 2011 deals, according to players who play mergers and acquisitions.

The stock is now US$9.96 below the proposed bid of as much as US$60/shr from Peltz’s Trian Fund Management LP, representing a premium of 20% if the deal were to close.

That is the widest price gap of any pending takeover announced this year, indicating merger arbitragers are betting that Family Dollar will not be purchased at that price.

Peltz, an activist investor who rarely buys entire companies, offered US$55 to 60/shr last week for the 2nd largest US "Dollar Chain", a bid that does not have financing, and would be the biggest acquisition of a US retailer in 6 yrs.

While Peltz likely will not end up buying Family Dollar, his offer for the Matthews, North Carolina based company may boost interest from larger rival Dollar General Corp.(NYSE:DG) and others. ---Paul A. Ebeling, Jnr.  www.livetradingnews.com

Danish experts fear long-term economic impact of Crude Oil price rise

 Energy efficient businesses and export of North Sea crude are helping Denmark cope with rising Global Crude Oil prices, and experts fear that the current Oil price turbulence may have long-term impacts on the Country's economy.

A sustained price rise could hurt business productivity, household consumption and exports, they considered.

Unrest has disrupted Crude Oil production in Libya, which normally produces some 1.6M BPD.

Global Crude Oil prices have risen, and Brent Crude, the Oil industry barometer, was priced at 110.9 bbl Friday morning.

Jacob Warburg, Chief Economist of Denmark's Foreign Ministry, that the Crude Oil price hike makes Denmark's energy-efficient businesses relatively more competitive, but the Country would also suffer if high prices lead to falling demand for Danish goods.

"Proportionally, it will strengthen the competitiveness of Danish companies, but the demand for their products will decline, if world demand declines," he said.

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"For every unit of production of GDP, we use less energy than our competitors. That means we will not be as hard hit by the rising oil prices as our competitors," Warburg said.

A number of Danish companies have pioneered low-energy consuming technologies in such industries as freight, shipping, and heat regulation and insulation.

According to Danish financial daily Boersen, a study in Y 2009 conducted by the Central Bank showed that the competitiveness of Danish industry increases by 0.25% every time energy prices rise by US$10.

And there is a chance for Denmark to earn big on high Crude Oil prices.

"We have a rule of thumb that says every US$10 increase in price per barrel of Crude Oil will mean an increase in public revenue of 3B Danish Kroner (US$550M)," said Martin Madsen, Chief Analyst at the Economic Council of the Labor Union.

Madsen based his calculation on the Finance Ministry's estimate that the average price of a barrel of Crude Oil is US$90 in Y 2011. If Crude Oil prices stay high, Denmark could earn a lot more than expected from its North Sea Crude.

"Because Denmark is a small-country oil producer and a net oil exporter, it has a positive impact on the Danish budget and on the current account," Madsen said in an interview.

"There will also be positive effect on Danish competitiveness, because we use less Oil in production relative to countries we compete with."

Denmark's total revenue from oil production in Y 2011 is estimated to reach 22B Danish Kroner (US$4.05B).---Paul A. Ebeling, Jnr.  www.livetradingnews.com

New OECD Aircraft financing agreement signed in Paris

 A signing ceremony was held in Paris Friday to mark official approval of an Aircraft Sector Understanding.

Angel Gurria, Secretary-General of the Organization for Economic Cooperation and Development, and negotiators from Brazil, Canada, the European Union, Japan and the United States attended the ceremony in OECD headquarters.

The signing sealed an agreement reached by government negotiators in Y 2010 December concerning new terms for the use of export credit financing for commercial aircraft sales.

The agreement aims to unify the differences in financing terms and conditions between large and regional jets, and to establish mechanisms to smooth sharp market movement.

"Governments have historically financed 20 to 30% of all Global aircraft sales, making these new rules a Key element in continuing efforts to bring order to the World’s trading system," the OECD said in a statement after the signing.---Paul A. Ebeling, Jnr.   www.livetradingnews.com

Goldman projects First Solar at US$190/shr

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Goldman Sachs (NYSE:GS) increased its price target on shares of First Solar (NASDAQ:FSLR) to US$190/shr as volumes continue to increase at the Company. With the higher price target, Goldman Sachs reiterated its "Buy" rating.

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At the Movies with Monica Petrucci from Tinsel Town

'Gnomeo & Juliet' bests 'Hall Pass' with US$14.2M to take the Weekend box office

 Nicolas Cage's 'Drive Angry' is dead on arrival at # 9; new version of Justin Bieber film Rules at # 6 after taking in US$9.2M.

The US domestic box office is in "Irons" over Oscar weekend, with the Farrelly brother's new R-rated comedy Hall Pass coming in # 2 behind Disney holdover Gnomeo & Juliet

In an unusual run, Gnomeo rose to # 1 in its 3rd weekend. The Blind Side and True Grit did the same, grossing an estimated $14.2 million for a take of $75.1 million, according to Rentrak.

Gnomeo, made by the now-shuttered Miramax, and released under the Touchstone banner, fell only 26% from last weekend.

Hall Pass, from New Line, grossed a soft $13.4 million from 2,950 theaters. The picture had been expected to open at least several million dollars higher, but didn't get enough young adults and older teens. A full 72% of the audience was over the age of 25.

Nicolas Cage action pic Drive Angry 3-D, the weekend's other new film, was dead on arrival. The movie, distributed in the US by Summit Entertainment, grossed an estimated $5.1 million to come in # 9.

Year to date, domestic box office revenues are down more than 21%, and distributors are growing resigned to the fact that the gap will not close until summer, when younger moviegoers should return to the multiplex en masse.

Sunday night's Oscar ceremony was expected to take a bite out of the weekend box office, although Gnomeo was more immune because of strong matinee business.

Gnomeo wasn't the only positive coming out of an otherwise tough weekend.

Paramount's maverick decision to provide die-hard fans with a Director's Fan cut of Justin Bieber: Never Say Never, succeeded in sparking repeat business in the film's 3rd weekend.

Never Say Never fell only 29% to an estimated $9.2 million for a take of $62.8 million. It should eclipse the $65.3 million take for Hannah Montana/Miley Cyrus: Best of Both Worlds Concert Tour this week.

Jon M. Chu's Justin Bieber: Never Say Never Director's Fan Cut included 40 minutes of new footage, and is only playing in 3-D theaters.

There also was continued interest in award frontrunners on the eve of the Academy Awards.

The Weinstein Co.'s Oscar contender The King's Speech was up 17% from last weekend for a new domestic take of $111.2 million. King's Speech placed # 8 for the weekend.

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Elsewhere on the box office chart, Liam Neeson action-thriller Unknown placed # 3 for the weekend. The Warner Bros./Dark Castle release fell 43% to an estimated $12.4 million for a take of $42.8 million in its first 10 days.

Sony's Adam Sandler-Jennifer Aniston romantic comedy Just Go With It continued to hold well in its third frame, grossing an estimated $11.1 million for a cume of $79.4 million, and coming in # 4.

Just Go With It was in a close race with DreamWorks Studios and Touchstone's teen SyFy thriller I Am Number Four, which fell 43% in its 2nd weekend to an estimated $11 million for a take of $37.7 million.

New Regency and 20th Century Fox's Big Mommas: Like Father, Like Son saw a bigger dip in its 2nd weekend, falling 54% to an estimated $7.6 million for a take of $28.6 million.

Hall Pass received a middling B- CinemaScore. Warner Bros.' marketing team succeeded in getting plenty of women, or 45% of the audience, but age-wise, the R-rated comedy played older than expected.

Only 22% of the audience was between the ages of 18 and 24, the perceived sweet spot. And 27% of the audience was over the age of 35.

Warner Bros. insiders say the jury is out on Hall Pass, starring Owen Wilson and Jason Sudeikis, until after its 2nd weekend.

Drive Angry, produced by Nu Image/Millennium, was also rated R. About a crook who is released from Hell to save his granddaughter, Drive Angry drew a C+ CinemaScore. Nearly 70% of the audience was male, while 61% was over the age of 25.

Gnomeo's strength comes from being the only family offering in the marketplace.

At the specialty box office, the Metropolitan Opera continued to enjoy success with its Met Live in HD program. Saturday's transmission of Gluck's Iphigenie en Tauride into 840 theaters across the country generated $1.75 million in revenues. An additional 90,000 people saw the opera, starring Susan Graham and Placido Domingo, on 550 screens in 28 countries.

Sony Classics Pictures scored the best location average of the weekend for acclaimed French film Of Gods and Men. The movie opened to an estimated $66,950 at from three theaters at the domestic box office for an average of $22,317.

Samuel Goldwyn Films' faith-based film The Grace Card grossed an estimated $1.1 million as it opened in 352 theaters for a location average of $3,100.

IFC Films opened Canadian film Heartbeats at the IFC Center in New York. The French-language pic grossed $7,300.---Monica Petrucci from Tinsel Town   www.livetradingnews.com

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US Major Markets Support and Resistance Points

DJIA Close: 12,130.45

Resistance:

12,391 is the February 2011 high

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13,058 the May 2008 high

Support:

12,110 the March 2007 closing low

11,893, the March 2008 closing low

The 50-day EMA: 11,898

11,867 the August 2009 high

11,734 the November 1998 high

11,452 the November 2010 high

11,205 the April closing high

10,963 the July 2008 low

The 200-day SMA at 10,935

 

S&P 500 Close: 1319.88

Resistance:

1325 is the March 2008 closing low

1344 the February 2011 high

1364 the March 2007 low

1370 the August 2007 low

Support:

1313 from the August 2008 interim peak

The 50-day EMA: 1288

1278 the 127% Fibo extension of the August 2010 move

1275 the January 2010 low

1227 is the November 2010 high

1220 the April 2010 high

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1174 the May 2010 high, 78% Fibo retracement off of April 2010 high

1173 the November 2010 low

1170 the March 2010 high

The 200-day SMA: 1169

 

NAS Close: 2781.05

Resistance:

2825 the 2007 closing high.

2841 the February 2011 high

2862 the 2007 high

Support:

2762 the February 2011 low

2735 the late 2007 interim high

2729 the 127% Fibo extension of the August 2010 move

2725 the July 2007 interim high

The 50-day EMA: 2718

2688 the January 2011 low

2676 the January 2010 low

2580 the November 2010 closing high

2569 the November Gap Open Up through the April 2010 high 

2550 the June 2008 high  

2530 the April 2010 closing high

2518 an interim high from April 2010

2482 the October 2010 high

2460 the November 2010 low.

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The 200-day SMA: 2432

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US Stock Market Sentiment + Bulls vs. Bears

The Market Sentiment

1. VIX: 19.22; -2.1

2. VXN: 20.64; -3.03

3. VXO: 17.81; -2.1

4. Put/Call Ratio (CBOE): 0.83; -0.16

                                                                 Bulls vs. Bears:

The Bulls are at 53.3% vs. 52.2% a week back. They moved up after a dip from 53.4%, but not charging North. They are below the 55.1% mark hit in January, and the 58.8% high on this run. Notably this is a high level in run high readings but below the 5 yr high of 62.0, and fading from the mark considered Bearish. It be prudent time in here but, there is still lot of liquidity in this market that can continue the push the action North in spite of the excess.

For your reference: to be seriously Bearish the reading has to get up to the 60%-65% level. 

The Bears are at 18.9% vs. 19.6% a week back. They are on wane after the fall from 23.3% 3 weeks ago, and below the 28.3% mark hit in September.

For your reference: the Bears hit a high mark on the prior run at 47.2%, and Bearishness hit a 5 yr high at 54.4% in last week of October 2008, that move over 50 took Bearish sentiment to its highest level since 1995, and Bearishness peaked at 37.4% in September 2007

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 1993.

**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.

***The VXO is the ticker created to track the "original VIX" that was calculated using the prices of S&P 100 options. The new VIX uses the ticker US$VIX and is calculated using the prices of S&P 500 options. The fundamental nature of the VXO is the same as the VIX, but it is less robust and not as simple as the VIX.

What to expect this week and down the line….

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This is a week filled with News and setting up for a rebound this week. There are good patterns in good sectors and good stocks.

 There is likely new money coming in and will likely not rollover. Though there are some good downside plays. Watch for Red's Bull Trade and Options alerts daily at www.livetradingnews.com

The focus the last 2 wks has been the chaos in the Middle East; here are some thoughts to consider on what may be happening there to give you a more rounded POV. 

The Army was in control in Tunisia and Egypt; they still are. Some things will change, but I do not believe there will be big changes for some time to come. Libya has about 2% of the World’s Crude Oil; aside from that it is not a Big player. Col. Gaddafi is finished there and on the way out as I write. His and his family's bank accounts are being frozen. He will end up fleeing to a place of "fighting to the bitter end." The new leadership there will likely come from the Army, and the Oil fields will come back on line soonest. Thing will settle down and a new political base will emerge to form a government.

Note: the Libyan Crude Oil is light sweet crude, and it takes 3 bbls of Saudi Crude Oil to make as much diesel as 1 of Libyan Crude Oil. So, I do not believe that the Saudis can make up that short fall if it gets turned off 100%. Oil could get very volatile and move up strongly if Gaddafi hangs on too much longer, $4.00 gas is not out of the question in the USA; but at the end of the day things will smooth out, IMO.

A Key place to watch is Bahrain; that can be an issue, as it is a strategic Country to the US, as its Navy's 5th Fleet bases there. Also, it has a large Shiite population that could align with Iran. What happens there is up in the air for now.

Saudi Arabia is a Key player, but so far it looks like any significant changes lay in the future. One day it will change, but it doesn’t appear imminent, but who actually knows, anything can happen. The King is spreading around about US$38B and opening things up a bit to keep his people "Happy".

How about Iran? Maybe the action in the streets of Iran will force some changes there soon, and one day soon Iran will be our new best friend; its population is young, and on the Internet. There they see what the World is like and they want to join in on it. No idea when it will happen but I believe it will happen.

Have a great week.

All the best,

Paul A. Ebeling, Jnr.

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  Red's Weekly Report on Gold, Silver and Crude Oil

Red's Weekly Gold, Silver and Crude Oil Report

 Charts by Omega Research

The Overall Fundamentals

The chaos in the Middle East and North Africa (MENA) region dominates the Headlines.

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In the Commodity sector, the energy complex was the best performer on the week, driven by rallies in the Crude Oil benchmarks (WTI and Bren).

Precious metals were mixed on the week. Though Gold and Silver rose, Platinum and Palladium fell on worries that Global growth might be dampened by rising Crude Oil prices.

 Base metals also suffered.

 The agricultural complex was the worst performer on the week with Wheat prices falling more than 10% as players took profits on the worry that geopolitical tensions in the MENA region would slow the demand for exports.

As the market focused on tensions and growth outlook, China's final trade data report for January were released last week.

And, despite latest tightening measures including rate hikes and increases in requirement ratios, domestic demand remains firm.

Imports rose +51.0% Y-Y, the Strongest gain since March 2010, and exports rose +37.7%, resulting in a trade surplus of US$6.54B, the least in 9 months.

Imports were very Strong in several commodities; iron ore imports rose +48% Y-Y to a new record high of 68.97 metric tons.

In the energy sector, Crude Oil imports rose +27.5% Y-Y to 5.2M BPD. Net imports for Crude Oil rose +26.8% to 5.1M BPD. And, with the exception of Gasoline, China was a net importer of all Oil products in January.

 Re-stocking appeared to have resumed in January with net imports for Nickel rising to the highest level since September 2009. Demand for Aluminum and Copper also was robust.

For this week, the news about chaos in the MENA region should remain in the Headlights.

Other event risks are the 3 central bank meetings Tuesday and Thursday.

The RBA and the BOC will be meeting Tuesday, but both banks are expected to leave Key interest rates unchanged.

For the ECB, while it's widely expected that policymakers will keep the main refinancing rate unchanged at 1%, some reported inflationary data has brought on some speculation of a Key rate hike earlier than previously anticipated.

Thanks to geo-political tensions and Crude Oil induced inflation worries, Gold recorded its 4th consecutive weekly gainer with the benchmark Comex contract approaching the all-time high of 1432.5 made in December 2010.

Following Gold, Silver also rose to a 31 yr high of 34.33 before settling at 32.90 on the week. Silver again shrugged off its role as an industrial metal, and performed like a precious metal. The PGMs failed to rise in tandem.

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It is well known that Gold's price is a beneficiary of geo-political uncertainties. Apart from geo-political tensions, Gold's outlook will be determined by inflationary worries and Global monetary policies in the main.

Global Crude Oil benchmarks rallied as protests in Libya evolved, and caused a disruption the country's Crude Oil operations.

It remains uncertain how much of Libya's daily production of around 1.6M BPD is disrupted (IEA estimated that 30-50% was cut while Italy's ENI said that 75% is cut), large Oil companies have reportedly trimmed their outputs by a great deal.

Oil's strength eased on Friday, and stock markets recovered after Saudi, the US and the IEA said they have sufficient Crude Oil stocks, and will supply them to the market if needed.

According to the IEA, Saudi Crude Oil is 'reportedly' flowing through the 750-mile East-West pipeline from the Abqaiq processing facility of 7M BPD capacity. The agency also added that the 'closest quality replacement' Crude Oils are from Algeria, the North Sea, West Africa and the Caspian Sea.

Saudi's Crude is different from Libya's in terms of Sulphur content (Sour vs. Sweet) and density (Heavy vs. Light). The lack of an exact substitute to Libya's Crude Oil will result in widening of light-heavy spread.

Players have put most of their attention on Libya, but they may have ignored Bahrain. The latest news about protests in the country is that King Hamad Bin Isa Al Khalifa freed more than 300 prisoners and fired 4 ministers.

The General Federation for Trade Unions warned that it may call a strike unless there's an ‘appropriate’ dialogue between the government and opposition parties.

While not an important Crude Oil producer, Bahrain has its geo-graphical importance as it's neighbored to Saudi Arabia, the World's largest Crude Oil producer.

The talk of "contagion" is still around, and analysts forecast that it is possible for the tensions to spill over into Saudi's Eastern provinces that are home to Crude Oil production and refining.

It is also the local of the Ghawar Oil field, the World's largest, and the Ras Tanura Oil port. Stay tuned...

The Overall Technicals

Comex Gold (GC)

Gold rose to as high as 1418.8 on the week, but lost momentum ahead of 1432.5, he Key resistance.

A short term Top has possibly formed with Bearish divergence condition in 4 hrs MACD and RSI.

Initial bias now is to the Southside this week and looking for deeper fall, as the choppy look of the rise from 1309.1 suggests that it was corrective in nature.

That means that it is possibly the 2nd leg of the consolidation pattern that started at 1432.5.

Sustained trading below 4 hrs 55 EMA, now at 1394.4 augurs a deeper decline to test 1309.1, the Key support.

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On the Upside: a clear break of 1432.5 is needed to confirm the resumption of the up-trend. Barring that, I expect Gold to have another decline even in case of another rise.

The Big Picture: I see the price actions from 1432.5 as consolidation in the larger rally. Also, Gold is staying comfortably inside the long term rising channel, and 1432.5 may not be the important op yet.

But, even in case of another high above 1432.6, I will continue to look for Reversal signal as Gold again approaches 2 important projection target, 161.8% projection of 931.3 to 1227.5 from 1044.5 at 1449.6 and 100% projection of 253 to 1033.9 from 681 at 1462.

On the Downside: a clear break of 1309.1, Key support, will be the signal of medium term reversal and should bring sizeable pull back towards 1044.5/1227.5 support Zone IMO.

The Long Term Picture: the rise from 681 is treated as resumption of the long-term up-trend from the Y 1999 low of 253. 100% projection of 253 to 1033.9 from 681 at 1462 is almost met, and a sizeable correction should be on the horizon. But, in case of deep fall, the 55 months EMA, now at 978.5 level, should be Strong support, and contain any downside action, and bring on another up-trend. Stay tuned…

Comex Silver (SI)

Silver rose to 34.33 on the week, just below the target of 61.8% projection of 17.735 to 31.275 from 26.30 at 34.67, and formed a temporary Top there and turned sideway.

The initial bias is Neutral for this week, and some more consolidations could be seen first, if so the consolidation should be brief as long as 31.64, the minor support, holds.

A clear break of 34.33 will target 36.6, the medium term projection target, next.

On the Downside: a clear break of 31.46 augurs short term topping has likel formed, and should bring about a deeper pull back.

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The Big Picture: this current action indicates that long term rally from 8.4 has resumed. Outlook is now Bullish as long as 26.30, the Key support, holds and current up-trend should extend to 161.8% projection of 4.01, the Y 2001 low, to 21.44, the Y 2008 high, from 8.4, the Y 2008 low, at 36.6.

Note: the rise from 26.30 could be the 5th wave of a 5 wave sequence from 14.65 (19.845, 17.735, 31.275, 26.3, ?) So, I will be cautious for signs of loss of momentum as Silver enters into 34.67/36.6 projection Zone.

The Long Term Picture: Silver's up-trend from the Y 2001 low of 4.01 remains in progress. I will stay Bullish as long as 21.44 resistance turned support holds, and expect this up-trend to extend further to 161.8% projection of 4.01, the Y 2001 low, to 21.44, the Y 2008 high, from 8.4, the Y 2008 low, to 36.6 next. Stay tuned...

 

Nymex Crude Oil (CL)

Crude Oil rose to as high as 103.41 on the week, and the Strong break of 92.84, Key resistance, confirmed medium term up-trend has resumed. Nevertheless, a temporary Top was formed, and initial bias is now Neutral this week, looking for some consolidations. But, even in case of a deeper fall, any downside should be contained by 92.84, the resistance turned support, and bring on another rise. A move above 103.41 will target 100% projection of 64.23 to 92.58 from 83.85 at 112.20 next.

The Big Picture: the medium term rebound from 33.2 is in progress, and is possibly accelerating again, and a stronger rise should be seen through 61.8% retracement of 104.27 to 33.2 at 103.70 towards 100% projection of 33.2 to 83.95 from 64.23 at 114.98.

Note: there is no change in the POV that this rally is the 2nd wave of the consolidation pattern from that started at 147.27, the Y 2008 high. So, I will start to look for a Key reversal signal again above the 114.98 projection level. But, a break to and below 83.85, Key support, is needed to be the 1st sign of a medium term reversal, and break of 64.23 is needed to confirm that action. Barring that, my outlook is Bullish in here.

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The Long Term Picture: the rebound from 33.2 may not be finished. But, the overall POV is unchanged. Crude Oil is in a long-term consolidation pattern from 147.27, with 1st wave completed at 33.2, and the 2nd wave from there is unfolding. A clear break of 64.23, the Key support, will confirm that the 2nd wave has ended, and the 3rd wave, a downward wave, should have begun. Stay tuned...

Red's Forex Report on EUR-USD

EUR-USD: The Bull Pressure Builds

Chart by Meta Quotes

EURUSD - The EUR maintains a bullish bias into this week, but it has lot of overhead resistance to clear before returning to the 1.4279 mark.

The 1st is 1.3744, its February 9, 2011 high, and then 1.3859, representing its February 2, 2011 high.

Once these Key levels are broken, I believe that the EUR will head towards its November 8, 2010 high at 1.4083, and then 1.4281, the level traded in early Nov 2010.

The weekly RSI is Bullish, and pointing higher supporting this POV.

On the Downside: a clear break below 1.3427, its February 14, 2011 will have to happen to bust its Bullish build up, and turn toward the 1.3245, and then the 1.3000 next. Stay tuned...

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The LTN “Hot List” contains potential investment opportunities suitable small, mini and micro cap portfolios.

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

See them daily at www.liveradingnews.com

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)

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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

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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

Disclaimer: The foregoing is commentary for informational purposes only. It is designed to help the reader learn the fine art of technical analysis. Links are provided to articles and stories referenced in this Report. Some statements and expressions are the points of view and/or opinions of Red Roadmaster™, aka Paul A. Ebeling, Jnr. and the contributors. This information is not meant to be a solicitation or recommendation to buy, sell, or hold securities. I am not licensed or registered in the securities industry. The information presented herein has been obtained from readily available sources believed to be reliable, but its accuracy is not guaranteed. Estimates, assumptions and other forward-looking information are subject to the limits of forecasting. Actual future developments may differ materially due to many factors. I do not receive compensation in any manner from any of the companies that are discussed in this Report. Please feel free to print and/or send The Red Roadmaster’s Technical Report on the US Major Market Indices ™ to your friends and associates, no permission is necessary. ©2002/2010 Paul A. Ebeling, Jnr.

DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS WEBSITE OR IN OUR NEWSLETTERS. Red Roadmaster is not registered as a securities broker-dealer or an investment advisor either within the US Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. The information contained on our website or in any of our newsletters should be viewed as commercial advertisement and is not intended to be investment advice. Any information found on our website, or in any of our newsletters is not provided to any particular individual with a view toward their individual circumstances. The information contained on our website, and in any newsletter we distribute, is not an offer to buy or sell securities. We distribute opinions, comments, and information free of charge exclusively to individuals who wish to receive them. Our newsletter and website have been prepared for informational purposes only and are not intended to be used as a complete source of information on any particular company. An individual should never invest in the securities of any of the companies’ profiled based solely on information contained in our report. Individuals should assume that all information contained on our website or in one of our newsletters about profiled companies is not trustworthy unless verified by their own independent research. Any individual who chooses to invest in any securities should do so with caution. Investing in securities is speculative and carries a high degree of risk; you may lose some or all of the money that is invested. Always research your own investments and consult with a registered investment adviser or licensed stockbroker before investing. Information contained in the Red Roadmaster Market Report will contain “forward looking statements” as defined under section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934. Subscribers are cautioned not to place undue reliance upon these forward-looking statements. These forward-looking statements are subject to a number of known and unknown risks and uncertainties outside of our control that could cause actual operations or results to differ materially from those anticipated. Factors that could affect performance include, but are not limited to; those factors that are discussed in each profiled company’s most recent reports or registration statements filed with the SEC. You should consider these factors in evaluating the forward looking statements included in the report and not place undue reliance upon such statements. Red Roadmaster is committed to providing factual information on the companies that are profiled. However, we do not provide any assurance as to the accuracy or completeness of the information provided, including information regarding a profiled company’s plans or ability to effect any planned or proposed actions. We have no first-hand knowledge of any profiled company’s operations and therefore cannot comment on their capabilities, intent, resources, nor experience and we make no attempt to do so. Statistical information, dollar amounts, and market size data was provided by the subject company and related sources which we believe to be reliable. To the fullest extent of the applicable law, we will not be liable to any person or entity for the quality, accuracy, completeness, reliability, or timeliness of the information provided in this report, or for any direct, indirect, consequential, incidental, special or punitive damages that may arise out of the use of information we provide to any person or entity (including, but not limited to, lost profits, loss opportunities, trading losses, and damages that may result from any inaccuracy or incompleteness of this information). We encourage you to invest carefully and read investment information available at the websites of the SEC at http//www.sec.gov and FINRA at http//www.finra.org

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