Curbing the Enthusiasm...

Good probability does pay off in this market, or in any market!    Basically, the trading thesis for us during the past few days was buying ETFs in anticipation of a rebound.    Today's the day, we "cash out" most of our chips.     Reason is simple, in this environment you have to sell on these "300+" rally days,  just as you would buy on a "-300" down days.     These days,  short term is usually 4 hrs and long term is like three to five days.   We’ll take whatever profit we can get out of this tough, miserable market.     Frankly, this run- up isn't one of those "one can time perfectly" kind of bounces.   But, you could see it coming as optimism around financials (C is just the latest bank to tell investors the current Mar Q is tracking to plan or better , (BAC, WFC, COF, PNC, and others, have all made comments to the St in recent wks signaling an on-track Q).  Citi was just the weakest stock and this news just exploded the sector.    This really should have started off WFC last week.   There's also been a divergence betweeen CDS spreads and the sectors stocks,  today these tightened across the board and helped the cause.   As far as tech, we noted TXN  could light up the scene here again and it's update didn’t disappoint.    Add these 2 sec's together and you get the biggest move in the SPX since November.   Still, we feel fortunate and somewhat lucky to get this kind of a point gain in ONE day without waiting another night or an extension to 6% over days.   Also as far as luck is concerned,  it didn't come as pre-run on M2M, but still was led by the banks- brokers..."pre-earnings type move in the financials/ brokers ( the laggers JPM, GS  eyes on) with market in tow".         For that reason alone,  we'd do the right thing and cash out the majority of our winning.  Back to our recent trading thesis, and it's all about probability.    If you ignore all the doom and gloom talk from every corner of the financial media,  it was just inevitable that we'd get a relief bounce from a trader's point of view.    If you followed the market pundits' never ending DOW 5k and SPX 500 call, you'd go nuts going long in this market.     We just had to stick to our trading discipline and play what's probable and NOT what's emotional!    Just remember, we bought stuff last few days not because we like this market,  but the fact we are playing for a bounce, nothing more.   We noted the supply of sellers on every rally …“…those expecting a bounce “(like us) … just use the next uptick to get out their supply of shares and sell instead of waiting with another night of overnight holds to chance again a real move upwards “(not us). …Well,  those that sold these latest upticks,  missed a big opening bell run -up and profits.   We do admit though,  separating our emotional feeling and trading discipline can be very difficult in this turmoil filled environment.   Strategies have to change as we go along.

Technically,  we are pretty much 3/4 of a way through toward the major resistance of SPX 740.   The climb toward SPX 742 will be much much harder in our opinion.    Right now, all kinds of possibilities are open on the table.   We can consolidate or we can inch toward SPX 742.     As far as news flow, we felt the M2M hearing and G20 events will now be non- events as of early today.   See midday forum post.

As far as plays go, all of the sectors on our list got a boost today, it’s hard to trade lower today, the most hated recent groups traded best (financials, industrials, materials, casinos).   Traders were not into ‘safe’ groups/ stocks.  We are still focusing on our usual ETFs and few selective techs/commods for coming days,  if buying opportunities presents itself.    If we can close the week higher than today's closing,  it'd be very encouraging.   Potentially, it can attract some sideline money back into this market.

Hump Day...

Did we get over the hump today?.   Besides "curbing the enthusiasm", we still wanted, what every wannabe bullish trader wanted and that was to see a follow- through day to Tuesday's rally   Considering this rally lasted longer (morning to close) yesterday,  we wanted to see institutions, MF’s step up to the plate today and carry this market further.   Equities opened strong suggesting some Instit’/MF’s don't want to be left behind.   You can only miss so many 5% gains in the books you show to clients every Q, so we had hoped they’d chase,  adding fuel to a rally.    This soon slowed and an overall boring choppy day ensued with the SPX closing in a tinge of green with no evidence of late day "whale" buying.   This hopeful whale of a day had no hump!. 

We noted early this week that we had liked the less talk days from D.C,  letting the market deal on it’s own to find a bottom.   Today,  it changed as O&G’ made an P.R. appearance and the market coincidentally or not (yeah, right) started to drip down from highs of day.    What still may encourage some is we didn’t give up the gains as a rule to recent past short covering rallies.   Honestly,  that's little consolation prize to us right now!.    SPX 740+ is needed to get traders thinking this move may have legs,  until,  we’d remain cautious and even leaning to short some ETF’s (SPY eg) for the cautious or some Banks-Brokers intraday for the more risky until/if we see this latest squeeze continue past 740.    We always talk about conviction buying,  a break of 740 would bring out memories of Tuesday’s rush to buy/ cover if it comes "soon".    As far as tomorrow,  the dull close with no whale buying seen should bring a lower open,  it also seems implausible for banks-brokers to outperform for a 4th straight day and lead the market higher by close unless the M2M surprises.   SPX  needs to stay above 715 for any positive bias to remain throughout the day.

Once again, 3rd straight day, we had banks- brokers outperform and Tech was not far behind.  The longer we can’t take out 740, the better the chance of some negative newsflow to come from the financials, especially overseas making for a quick end to this move.  Pessimism will return, outweighing the positive newsflow from WFC,C etc on this side of the pond.  

At least, we had some play on a shadow listed alerted stock,  AXYS  at $33 that gave a ride to a high $39.  The rumor was confirmed AMC by AXYS and we think this is a nice hold if you got in 35-36 or lower. The reason is this stock had fallen to very cheap levels as CEO noted in release and this has draw suitors to inquire and it has only about 11mln outstanding shares which a huge Defense integrator like L-3, Raytheon etc might find cheap even at $50+ X OS.   Basically, its undervalued even at yesterdays close.   Of course, AXYS can pull itself off the market and the stock would fall, but that may only occur when prices are substantially higher and it wouldn’t matter cause we all should take profits along the way.  Still, if doesn’t get eaten, it has many pending contracts in the works that are not included in growth projections.

AMC,  we had STLD  lower numbers, we are even more negative on this steel drum band of STLD, AKS, NUE, X  than after X’s earnings (Jan 28/29th Jrnl), just before the recent market collapse started .  X has dropped from $36 following EPS to a low of 16+ and we think it will revisit those levels.  This sec’ may shadow the Shippers to some degree with debt issues.  That's the short end of it as long as the market doesn't show more upside.

Optimism Justified?

We are asking this question tonight as most of us have been just utterly speechless about the market action today.  It wasn't the fact SPX +29 busted through the 740 level with ease and finished at November closing lows,   it was the fact that the rise was led again by the financials (4th straight day).   It may be an understatement to call this a rally because things have happened so fast.   Will good ole’ key SPX 751 be as easy?.   That’s the current question as this remains a very technical market,   so every level of R/S is essential to watch for a turn.   Now at the third day of the rise,  this markets long term trend may be over.   We’ve concluded this past year that a long term trend in this market is no more than three to five days and this may be a good area to stall.

A lower futures premarket turned as positive newsflow hit and continued:

• GE downgrade removed an overhang as it wasn’t as severe as feared.

• retail sales.

• M2M surprised some as congress told FASB to issue new guidance within 3 weeks.

• Swiss franc action suggests relieve of strains on C/E European countries.

• BAC/GM newsflow.

Honestly,  volume isn't that impressive outside of the financial area.  Today’s action is mostly ETF’s / banks-brokers with individual stocks in other areas not having much activity.   Biotech is 2nd best sector riding the M&A activity brewing we noted as a positive for market early in the week.  We were negative on steels and coals before the trading day and they could’ve done worse,  if they didn’t get caught up in the tape of the melt up.   Ag’s had a peer in Europe give a bad impression (earnings).   Still,  most of the red you see today is from this essential groups(s) for healthy action going forward.   By today’s action, you have to think its telling us something about Global activity.    Also, tech was a relative laggard as it didn’t get caught up in the broader tape action as much as you’d expect or like.     Today's action is still the result of the oversold condition during the past few weeks.   Now that BAC- CEO Ken Lewis gave us a similar outlook of its company to Citi and JPM, we don't know if there's any other good news that can potentially lift the sector any higher into their earnings season kicking off in April.    At this juncture,  this rally seems to be one dimensional (banks-brokers, ETF’s) and pretty quiet all things considered.

We have been pretty patient with this market last couple of days.   The enthusiasm has to slow down or stop at some point as this is a technical driven market.    Right now, we are taking things literally one trading hour at a time.    Although a bit unrealistic at this point, the next major resistance after SPX ~750 is 780.   The trade does favor the fading of any further rally.   Tomorrow may be a good time to start poking shorts if the idea of "locking profit" still exists these days.   

There was some negative flows showing,  but they were ignored today as equities outperformed the credit market, which wasn’t tightening today.   Same divergence here as pointed out recently.   We’ll see if the ‘whales’ come and push this higher,  if they think this is purely a banks-broker short lived rally,  they won’t come.

...and finally, the kitchen sink

Shocking, stunning and overwhelming!.  For sometime,  we've felt that we are going through an unusual period where the conventional method of thinking just do not apply to this market.   Seems the FED was thinking the same in what could be thought as an act of desperation in days to come.    We said the FOMC is likely to announce something new to look proactive and even said the market might be anticipating to buy treasuries.    This latter still seemed implausible, just ask every currency/ bond/ trader feeling jolted tonight.     Lately,  it's getting to the extreme side of unconventional,  this direct intervention hasn’t been seen since the 1960’s.    As a trader, before you enter a trade or plan a trade, you ask yourself, "what's the probability of this and that?"    There was little probability of this FED act and is somewhat disgusting as they hinted away from this treasury buy as late as a week ago making for a stunned marketplace today.   The coupling of the market coming to a technical key (SPX 800) and with the majority of traders thinking of a mute FOMC announcement it looked like a sell off in the making.   A question is what do they know that we don’t know, maybe it’s something on the banks, TALF may take more time to get going than previously envisioned and/or of things to come in the economy.   It's definitely a sign of alarm over the FEDS heads as they couldn't wait for the TALF to spur things.    We can only hope this bomb will be viewed as a positive in days, weeks to come and we can concentrate on trading individual stocks/ sectors on the long side as before than trying to manoeuvre around the SPX and the ETF’s.   Hope is to get away from the technical trades that have consumed most retail traders due to lack of any concrete group action.  Hopefully, a beneficiary group will emerge due to these FED actions.

One lesson learned here and for many again is the old basic of not fighting the tape of the market!.  If we see and say for days ... shorts are not lining up new positions due to upside risk to news.`...why do even bother looking at all those technical levels as possible reversals.   It was the trend that was signalling fear of upside risk on newsflow outweighing the downside risk to previous lows.  If we had stuck to initial ideas of conviction buying coming in on a break of 740 and a meaningful bounce possibility from the Mark of the beast` 666,  we`d have no regrets today.    Everywhere you look tonight many are second guessing themselves, either because they did not follow through on first long ideas or going short, trying to fade the market at higher levels.   Simply, the tone had changed towards equities and no resistance levels mattered after we continued the squeeze through 740, but with continued head-winds and remembering all the failed rallies in the past months, you were somewhat programmed to think the same would occur instead of just going with the trend, herd.   When we traded our themed earnings winners, IBD momo stocks, it didn't matter these stocks had way overbought RSI's,  we just continued trading the trend very profitably.....the market indices have shown it is capable of the same this week.

The "good probability idea" trade is staying mainly on paper as the risk of being rolled over is too great.    The Fed delivered a big blow to shorts by announcing this big spending program as they boosted their balance sheet by another 1.150 bln, a balance sheet that is set to grow to about a 1/3 the size of the economy.   This will ensure that the rates stay at an exceptional low level for an extended time, so the economy can get back on its feet.    The FED has basically bought more time for this to happen, it’s helping everyone from the small business owners to mortgage payers to lower their cost. This is by no means small news and arguably the best news we could possibly get, but pronounced headwinds remain.   Let the debates begin and hope this time,  it finally becomes the game changer move.

The trading result is equities went over SPX 800 before pulling back some to close at around SPX 794. This is just wow kind of action and reaction.   The centre of the action again was focused on the financials.   We have been having back to back to back.... gains from some of the familiar names in the past few trading days.   Right now, there's no point arguing whether the move is justified or not.  What's done is already done and we have to settle ourselves into a good trading frame of mind going forward to dissect all of the recent events.   The market has been in an over extended mode and there's no telling how much longer it will extend.   The short covering continues.   We will watch the next couple of days to regroup ourselves and watch/ digest of what may or not work going forward. We have to look at this as a potential fresh start in going back to basics of trading.   Again, there's a lot to take in right now and we have to think thoroughly on our main trading strategy for the next few weeks and see if a posiitive group emerges.    We know a lot of other traders are in the same boat as us and it‘s best to be sidelined.   Despite the huge gains recently,  we know for fact most traders aren't having big trading gains unless they are into extreme daytrading.  This market has become a "trader vs. investor" lately and we have to be extremely cautious when deciding our next course of trading action. 

This is going to be one of the most remembered Fed days in history. The heads are spinning to this jolt.

underlying bid prevailing..

Underlying bid prevails today as the bigger fish go fishing...

Just some scattered trading thoughts,  mostly due to fact many aspects of this market/ plays remain the same since late last week.

Two characteristics of the market still showing,

1) Shorts are NOT starting fresh shorts due to upside risk of news.  Ones that pressed with downside were left dazed and confused.  Also we still feel the Hedgies/ Institutions, MF’s pensions (whales) are chasing equities to pretty up their books month end/ Q end.

2) We kept mentioning the underlying bid providing support yesterday, we thought and got it in the morning as we extended higher (helped by durables, housing) after not such a nice close on Tuesday.  We alerted in the afternoon, we were aware of Whale buying the Industrials in the morning (this spurred by eco‘ data), the idea was they would come into the closing broadly.   Remember, this is mostly the time whales buy,  this is why last 30 minutes to a close is such an important ingredient to the health of the market.    Besides, we didn’t think the low volume downside to under 800 or the Treasury auction news was all that important.   Other news providing some headwinds was Trsy asking for authority to seize hedge funds and worries they won't just let banks leave the TARP in near-term.    Almost to the minute of alert,  we got a V-shaped bounce started which scurried out any shorts that pressed into this downside move thinking this rally was broken.     Again, the underlying bid is there for now.   

Remember,  instead of scurrying around the find a stock that may work during/if we get a big move such as this 140DJIA +reversal in minutes,  just go with SPY/SSO or even better go to JPM/GS  to get the most out of a move.    We’re having some trouble getting through  ~820SPX area,   but this kind of close will make everyone think twice..the bulls (encouraged ,confidence) and bears (losing faith, jittery).    This is looking like more digestion above 800 before a move higher, instead of indigestion.  A meaningful break of 820 very possible tomorrow. *eco data tomorow morning.

Sec's

We had short covering early in the steels , again X  leading the way.   Considering,  we are about a week into the inflation linked equity trade,  we succumed to quite a bit of profit taking as the broad market sold off.    Always remember,  if your stock/sec has been fastest to the upside,  it will be one of the fastest down as the broad market turns.    This trade will have hiccups, so as we answered in the forum last week, everything is still a trade, not an investment, so take profits along the way.   We've all learned the past 12+months this a traders market.    As far tech/Naz related stocks,  we had SMH $SOX  breakout after the opening bell,  but it got taken down with the tape.    $SOX,  we'd like this 230 broken convincingly to attract more interest,  including ours to go into the high beta's stocks.

More tailwinds than headwinds...simple for now.

DJIM #13 2009

On the back of this rally,  we've outlined consistently the tailwinds are outweighing the headwinds and so let the beat go in and trade with a bullish bias.   Unfortunately,  this weekend we've got the one potential headwind (D.C!).. "Unfortunately, this is a D.C sideshow the market has to deal with on a daily basis now".    Instead of waking up to continued M&A activity on Monday to keep the market rolling,  we've got that D.C cloud over the global markets as they talk tough with GM/Chrysler.   In reality this item goes hand in hand with the things were ' tougher' in March banker comments from late Friday (still ,NTRS BAC said there are tentative signs of bottom in economy during meeting but this not really reported) and thus the 2-4% downside globally.   SPX held 790 overnight.   At this juncture in the rally,  we think this reaction is more of an excuse to take profits.   This exaggerated move might may turn out to be a buying on the dip opportunity.   If last weeks underlying bid/ support takes advantage drops is any indication,  the market should shrug this off.      Nevertheless,  we'll avoid the initial sell off opportunity to buy into and just wait for more headlines.      This is going to be a rich newsflow week and we expect volatility intraday Monday through Friday!.     After taking advantage of the inflation- linked trade last week,  we're in no hurry to add early this week and instead turn our focus on corporate earnings.    After all the positive financial newflow and 'hints' of stabilizing economic data it all winds into the upcoming corporate earnings season.    All the momentum and good breadth seen is at risk  as all eyes are on 1Q reporting season.

Besides,  the wildcard play on commodity equities here,  we have stocks like EBS MYGN  that should withstand broad selling as their sec's are usually quite immune.   We also added STP  in hope the solar 1 - day frenzy has any legs,  we said this China paper will do nothing for U.S based Solar co's on the revenue front, plus the budget is not so great so far.   Still we went with the STP  ADR despite all the negatives,  even a 'short this play' call from FBR.     We think it acted well late despite this and started a speculative position,  maybe traders will look for a sector to manipulate higher.    As we said following the Treasury buy news,  we are turning to individual stocks- sec`s away from the market driven technical SPX /SPY trade.    We are hoping, like the commodities,  some niches will emerge and not trade with the broad market on a daily basis.

Tailwinds to run over 860?

Once again,   DJIM keywords for the state of the market the past while,  prevailed today.  The lead we’ve been going with in maintaining a positive bias consists of the words…tailwinds, underlying bid, resilient.   All these showed up today as stocks closed +2 SPX points after staging an impressive rally off the opening lows.    An underlying bid was again present showing resiliency and signalling tailwinds, mostly in hints of stabilization in eco' data working hand in hand with much better numbers from the banks (WFC).    Leading the market tape today was definitely the financials!.   There was no real catalysts today,  just more tailwinds generated by WFC from last week.    Although,  we did have more positive headlines from China showing trends are stabilizing,  loan growth is going through the roof and gov’t players continue to make positive commentary.

Sector watch

Banks- Brokers linked,  what can you say,  but keep with up the herd.   You know the stocks we like at DJIM.  AMC, all GS  did was set the bar higher for others with a much better expected report in many aspects.  The public offering is quite neutral on a dilution basis (limited risk).   We dipped into the V -MA for stocks linked to financials as the charts look ready for more.    It will be interesting to see the GS reaction, the market might be feeling spoiled and not give this report all it deserves initially.

Commodity linked -stocks

The $CRX  made a new recent high as the USD weakened mostly due to many of the world markets being on holiday.  Basically, if left home alone,  this USD related sector was doing what it wants and some give back may come early tomorrow.   Still, we are specific here lately with what is working,  primarily the Steels  and Ag`s-chems - and our only copper play FCX  has been a standout, even alum' AA  got up to $9.30 since we said this stock should trade up following report.(mid 7`s).  Throw in a little solar (STP ), but we're staying away from the coals.  

China linked - stocks.

A positive is no matter the hiccups the market-SPX may have soon or later,  we are getting back to individual stock- sectors working by themselves.   This was the strategy here if you recall following the Treasury buy news to go with individual- sector plays instead of being fixated with the daily SPX up and downs.    Guess what?..the China theme is seemingly here again as many of old DJIM names are coming up all over daily high screeners.   Stocks like SNDA, NTES making new highs and more to come.  One way to get your feet wet here is with CAF,  if you are not comfortable with that FXI.

Tailwinds to run over 860??...Of course,  earnings will dictate,  but if we keep getting surprises we'll have the shorts giving up and we can really overshoot 860.   The reason is this is where most of the shorts are set up from mid Jan -Feb!!.

A major eco' address tomorrow, "recession to recovery".  Hopefully,  this is just another tailwind-ish` catalyst.

Ouch!

It was ugly!   For a number of days, we were wondering what it would take to bring down this market, we wondered prior to Friday’s trading day, “Tomorrow, is seemingly the perfect day to begin a much awaited “sell this rally” correction with C, GE on the podium”. 

Well,  a day off, we got a legit catalyst (BAC) today that simply spooked just about every type of investor and every sector,  Notably, $BKX( bank index) >15%,  Materials were under big pressure led by crude <8% on a very strong $USD.  Industrials, Tech>3% (semi’s >6%).,   There wasn’t an escape clause (sector) if invested over the weekend.  You simply get hit!

BAC ,  the once hated bank among the investors, is back with a "NOT so inspiring" earning report (big deterioration in credit). This may just be enough to put the "we are still not out of the financial crisis" agenda back on radar with stress tests results coming.    It is somewhat unfair though, especially after what companies like WFC JPM GS  BBT  have said in their report.     This may just be a company specific issue, we all know BAC isn't a five star quality anymore and hopefully the market comes back to it‘s senses and understands there is a ‘best of breed‘.    However, this is exactly (any excuse) what sellers wanted and were waiting for at these overbought levels to roll this market over.  Rollover they did!

We closed at SPX 833, which is below the low of last few days.  We'll see if any bounce occurs around here,  it didn't look like a possibility with the ugly close.    The next major support is around SPX 815 area and it isn't that far away.    Without some major positive catalyst, we think the shorts will press below the 840 level to test that 815 area this week.    It is therefore, extremely important for us to stay level headed and accept this as a fact.    We have to play defensive on this sell-off until some more meaningful trend is established.    Can today's action derail the recent up move?  It certainly can and as a matter of fact, many bears even confirmed today's action as the "tell" to go short.    We are not so eager or quick to jump on the bear wagon, but we do have to respect the opinion on the other side.   We have to let this market settle and we have to see where this market will find its footing.    When it settles, we'll then decide whether to play the recent earning stand outs or a specific sector.    It is just too early to jump to any firm conclusion after just one day.

On the bright side,  we do have ALGT ,  we’ve been watching it as it hit highs last week. Performed really well today after their conference call.    This play has a particular high short interest/small float, so that may have something to do with its strength today as well.   

Bottom line, we aren't going to be buying on dip on anything at this point and we will let this market settle down after today's ugly session.  We have lots of Dow components, Banks reporting tomorrow morning and a few tech statements tonight for the market to decipher.

All about EPS to some...

Other than the EPS stories (to DJIM),  there was no dominating noise to explain the market stability and rise today.   As a whole,  this market shrugged off the morning weakness and closed the day near the high.   This is quite remarkable given the weakness we had toward yesterday's late day session.    Technically, we dipped south of SPX 840 intraday, but it’s only bearish if it closes there.   Mkt closed SPX 850, right in the middle of the range we‘ve focused, sort of the battle ground these days.    As we have mentioned the last couple of Journals,  we seemed to be range bound until something catalyst that can drive us higher, or lower.  

The market players are attempting to say such things as, (Briefingcom)…Another factor keeping a lid on rallies right now is that this earnings season is shaping up to be essentially a lot of white noise….Moreover, while the unexpectedly high number of current quarter beats might normally be seen as a positive catalyst for the market, what is keeping a damper on most earnings-fueled rallies is that: 1) stocks already have had extended runs into their reports, and 2) as is typical in a recession, these bottom-line beats are most often enabled by aggressive cost-cutting rather than stronger than expected demand.  

Here at DJIM, we are not looking for another substantial rally, we just want to see the market break this range.   Yesterday before the open (Forum), we noted their was ‘broad’ corporate trends that we felt might give the market a boost.    Considering,  the previous close was ugly, a day with no catalysts and some EPS stories (CC's) during the trading day , we somehow closed at SPX850.  We think earning are playing a quiet backdoor role.    Do you have a better explanation?.  This premise has some credence following AMC reactions to MSFT, AMZN.   Of course, barring any “stress test” negative cataylst, we think the market may abate the “ selling the news(eps)” and surprise many by breaking over 860!.

As far as individual/ stocks, we couldn’t be more pleased with the action LVS  WYNN.  Both continued the squeeze potential we alluded to and were up another 10% early while the overall market lagged.  We also had a nice 3+ move from alerted PENN ,  a “Racino” off earnings, besides the earnings we liked it fit because it fits into the Gaming play.


On the negative side, we’re sorry to see our favorite commodity group since late March disappoint.  NUE, RS, and STLD all moved lower as the concern of the health of this industry lingers.   The ag-chem sec wasn’t so rosy either as POT, did not inspire much confidence either after its report.    This basically gave us the confirmation that you'd never know how this market will respond to certain report/guidance.   On the other hand,  we had a couple of well received statements from the likes of AAPL EQIX.    We were actually quite surprised to see EQIX have such a strong reaction which is very different to last quarter's reaction to a similar report.

Banks, again,  were leaders late carrying the market tape into the green.  We commented BLK  might be gaving reason for optimism later.  It broke out with another 4+ points add on late and  WFC, JPM, GS, STT, (PNC, CS  earnings noted)... just a few on our list that performed exceptionally well.    If the market players can let out a breath, a  sigh of relief on the stress tests, the XLF breaking $11  will cause a nice break to the upside.   The Futures are pointing to a lower open (low 840's), but we think this will change by open.  Euro markets may give signals to market direction early on.

Tomorrow,  we'll get a glance of the criteria that's being used in the all important "stress test".   This is definitely going to be interesting as investors would see for themselves how some of their favourite companies will fare in the test.

AMC, we've had some nice reactions to the corporate trends for Nasdaq tech- linked MSFT, AMZN, JNPR SYNA and even in a financial link, AXP (huge expense cuts).    Unfortunately,  we also had the news that Chrysler is nearing an announcement to file for Chap 11. This should be overshadowed and relate more to sub groups.   The trend lately seems to be favouring the EPS stories in our eyes.    So far, we had quite a few market leaders that showed decent eps reaction, in our view AAPL is not 'selling on news' typical as others seem to be calling it because a stock doesn't jump 10-20%.    This is definitely a high contrast to what happened last quarter as most of the companies were taken down hard after their earning report.  That was selling the news.

At DJIM,  we have been doing some quick trading here and there last few days.   However, we are still waiting patiently for this market to make a major move.    The probability, at this point, still favours an up move as oppose to a down move as 840 seems pretty formidable this week.