The Euro is rallying to a 2 mo high vs the US$ after Spain sold 15 yr paper at a solid b/c of 2.57 with a yield of 5.12% vs a b/c of 1.79 and yield of 4.43% in May. Yields across their curve are lower with the 2 yr in particular falling to the lowest since May. The 10 yr spread to the German Bund is at a 3 week low and the IBEX is rallying to a 2 mo high. Greek stocks are also at 2 mo highs after Greek bank Piraeus (one of the 91 banks being tested) offered to buy government stakes in 2 Greek banks as the consolidation of their banking system has hopefully begun. Greek 5 yr CDS are quoted below 800 vs 1000 2 1/2 weeks ago. ECB’s Mersch said “we should not get addicted” to bond purchases and implied they may be ending soon as they only bought 1b euro worth last week. The Shanghai index closed at a 1 week low after Q2 GDP rose 10.3%, still solid but .2% below estimates and Retail Sales and IP were below forecasts. FDI though was up a big 39.6% y/o/y and CPI and PPI were lower than expected.
Back on June 11, 2010, I noted that the Brits thought we were being rather hypocritical in our outrage over the BP Oil spill. If we were really all that concerned, argued the Brits, we would be more moderate in our consumption, have no love affair with the SUV and enact Pigou taxes on fuel…Read More
July 14, 2010, 3:16PM The good news in America today is that many of lies from our leaders and media no longer seem to be working. Four out of five people view the current proposed financial reform as ineffectual. Many in Congress who voted for socialism for the rich now look like they will be…Read More
In line with this morning’s early post (Four out of Five Americans See Financial Reforms as Ineffectual), I discovered, quite by accident, a horrifying little article in the July 12 Time magazine (seen at my hair cutter’s and local barber shops everywhere). The online version is pretty skimpy, which is probably why I didn’t see…Read More
Within the minutes of the June FOMC meeting where they reviewed the economic stats seen since the prior meeting, they believed looking forward that the recovery in economic activity would be moderate thru 2011, “supported by accommodative monetary policy, an attenuation of financial stress, and strengthening consumer and business confidence.” They did say that the…Read More
“How Crazy Is That?”: Startups Are Safer Than Stocks, Howard Lindzon
Yahoo Tech Ticker Jul 14, 2010
Tomi Kilgore warns that the recent bounce may be a sucker’s rally:
“The current rally marks the fourth time since early May that the Dow Jones Industrial Average has bounced more than 5%. Previous bounces have taken the Dow above key resistance levels, and yet subsequent declines have resulted in even lower lows. Essentially, the recent pattern surrounding key technical breakdowns and breakouts suggests the Dow is nearing yet another turning point.
It is easy for bulls to fall into another technical trap, since the Dow has climbed above the 50-day simple moving average, which has acted as resistance since the Dow first fell below it in early May, and is now peeking above a downward sloping line that started at the April 26 high and connects the June 21 high. But rather than embolden bulls, the apparent breakout should actually make them skeptical, especially following a six-session rally. “
Other traps of note:
-When the Dow fell below the 200-day moving average;
-After the Dow closed above the 50-day moving average
-When the Dow hit a new low for the year.
-The break below the June 8 low of 9757 (confirming a head-and-shoulders pattern)
Kilgore wanrs that “those reacting to technical breakdowns and breakouts have been fooled many times. And keep in mind that the Dow’s last six-session winning streak ended on April 26, the day before the market correction began.”
The broad trading range, lack of volume, and short term trends that reverse have some people sitting on their hands. Its not a bad way to prevent them from doing something silly . . .
Investors Shouldn’t Be Fooled By Another Breakout
DOW JONES NEWSWIRES, TAKING STOCK: Jul 13 2010
I’ve attended Wired’s Disruptive By Design conferences, and they are always top notch. Here is the Conference Digital White Paper, with highlights from the WIRED Business Conference on June 14, at the Morgan Library in New York City. This White Paper features a summary of each session, where various business execs, including Howard Schultz, Frederick…Read More