Market Watch for Thursday – April 2, 2009.

Wednesday’s recap: What a way to begin the new quarter … down by triple digits at open and up by over 150 points by close!! Some sense of optimism is slowly building about the economic recovery. Today’s dismal opening was attributed to a couple of factors. News from Asia were not good. China’s manufacturing index came in lower than expected, and Japan’s business sentiment among big manufacturing firms came in at a record low. Further, prior to markets opened, the ADP report indicated a dismal private sector employment condition, a drop by 742,000 in March. This figure was higher than anticipated. So, the markets opened in deep red.

As the day progressed, small doses of good news trickled in, and the markets responded. The next economic reports came in showed a rebound in pending home sales and improving manufacturing activity. Despite massive public protests, there’s some good news out of G-20 meeting. British Prime Minister Gordon Brown said that the G20 was close to agreeing on global reforms for the financial system. This was not expected.

The Dow rose 153 points or 2%, to 7762. The S&P 500 index gained 13.2 points or 1.7% to close at 811 and the Nasdaq picked up 23 points or 1.5 percent, to close at 1552. Crude oil fell $1.27 to settle at $48.39 a barrel. Gold prices rose by $2.70 to $927.70 an ounce. The dollar was mixed – slightly weaker against the yen, but was stronger against the euro and pound.

Chemicals, gold miners, banking, and technology stocks had a stellar day. TaurusTrader had an OK day. No big gain or losses. No position was stopped out. However, it was a decent day for day trading. Had a nice success with TNA and FAS among the picks.

I also initiated small positions in MS ($22.30) and WFC ($13.75) at the open today ahead of FASB’s decision on mark to market scheduled for tomorrow. I wrote about it in my yesterday’s blog.

Stock Picks for Thursday, April 2: There are good news coming in small doses. The worst is not over, yet. The pain is still there, but there is some optimism building that the pain from recession is beginning to recede. If FASB modifies the mark to market rule tomorrow in favor of banks, it should bode well not only for the banking sector, but also to the whole market in general. The markets may have already baked in for a slight disappointment in Friday’s jobless data. Unless it comes out real bad and out of whack, the markets should do fine. But, any improvement in employment numbers, however unlikely, should help vault markets higher …. Omen!!

I would like to add the following stocks to TaurusTrader swing portfolio:

1. EXP – Buy above $25.50, stop at $22.75, target $28.50 (volatility is high)
   
2. WDC – Buy above $20.01, stop at $17.98, target $23.00
3. HSP – Buy above $31.41, stop at $28.60, target $35.50
4. TNA – Buy above 18.60, stop at $15.75, target 21.50 (very volatile and risky)

Chemical sector is showing some momentum.  If you have additional capital to commit, I would suggest looking at DD and DOW.  Both these picks also have strong ag portfolio that compliment  their chemical business.

I’ll not day trade tomorrow as I’ll be away on my other business interest that I detailed in my earlier post on Wednesday.  However, if interested, the financials may again provide some opportunities for profitable trades.  My favorite ones are – WFC, FAS, and MS.

MON is scheduled to report earnings prior to open on Thursday.  Expect high volatility in ag and fertilizer stocks in sympathy.

If there are questions or comments, please do post.

Best regards, and happy trading ….

TaurusTrader

http://www.taurustrader.wordpress.com

Week Ahead for Stocks, March 30 – April 3, 2009

Weekly Recap (March 16 – 20, 2009): Stocks made some historic progress …. gained for three weeks in a row, the largest move since 1938.  It was a huge 3-week rally.  However, markets stuttered a little bit on Friday heading into the weekend mostly from profit taking.

On Friday, the Dow fell by 148 points or 1.9% to end at 7776.  The S&P 500 fell 16 points or 2% to end at 815, while the Nasdaq lost 41 points or 2.6% to end at 1,545.

Index	Started Week	Ended Week	Change	% Change	YTD %
DJIA	7278.38	7776.18	497.80	6.8	-11.4
Nasdaq	1457.27	1545.20	87.93	6.0	-2.0
S&P 500	768.54	815.94	47.40	6.2	-9.7

For the week, the Dow rallied 6.8%, the S&P 500 gained 6.2% and the Nasdaq rose 6%.  For the month so far, the Dow is up 10.1%, the S&P is up 11% and the Nasdaq added 12.2%.  The S&P 500 is now up 22.4% from its March 6 low of 666.8 points.

The bulk of the gains however were made on Monday with the major indices gaining over around 6% on the news of Treasury Dept releasing details on its plan to remove troubled assets from the balance sheets of banks.The gains continued, albeit modestly through rest of the week, building on some better than expected data from the housing sector, February durable goods, and final 4th quarter GDP.

Believe it or nor, the treasury auctions usually a non-market event, turned out to be a major market mover this week due to some saber rattling by China by its negative comments on US debt.

Tim Geithner and Ben Bernanke appeared before Congress during the week.  Geithner also appeared on Sunday morning media circuit touting administration’s ideas and plans to jump start the economy.  Geithner is looking more and more confident, and markets are slowly warming up to the new Treasury secretary.

In the end, all ten sectors posted solid gains for the week.  Financials advanced 12.2% , industrials gained 10.5% and consumer discretionary advanced 8.8%.

TaurusTrader had a phenomenal week.  Seven positions in the swing portfolio achieved profit targets, ranging from 8.6 to 47.4%.  The positions that hit profit target, hence closed were – TCK, MELI, BMC, RY, CPRT, BX, and WSM.  Also, the April 12.50 call option in WDC (WDCDV) was also closed netting 100% profit. Please refer to my earlier posts for details.  None were stopped out.  TaurusTrader also had several successful day trade opportunities for 2 to 5% profit per trade in several recommended equities – FAS, MS, WFC, TNA, and BAC.

At the end of the week, TaurusTrader was long in – WNR, AGU, AMR, MBT, FCN, MDR, HNT, RIO, HON and BAC.

Week Ahead, March 30 – April 03, 2009: Markers are in oversold condition. Some pull back is possible, especially at the opening on Monday.  Like in previous weeks, markets will mostly be driven by news coming out of DC on auto industry bailout and banking regulations.   The G-20 meeting of finance ministers on April 2 is another media event that could have some impact on currencies.  We may need to keep an eye on how the bond and treasury auctions go. There will  be a hearing on mark to market accounting which could impact the markets.  Fed Chair, Ben Bernanke and Vice Chair Don Kohn are scheduled to speak on Friday in separate events.  On the earnings front, 52 companies are scheduled to report this week – the last week before the “official” start of 1st quarter earnings.  Some important reports that I would be watching are:

• Monday:  CALM, LAYN, SNP, CHT
  
• Tuesday: APOL, BGP, GIGM, LEN, SAH
  
• Wednesday: WOR
• Thursday: AYI, MDRX, LNN, MU, MON, RIMM
• Friday:  AZZ
  

For details on earnings calendar, please visit: http://www.zacks.com/commentary/10445/Earnings+Preview+for+Mar+30+-+Apr+3

Economic Calendar: Following economic news might have impact on the markets –

For details, please refer to:   http://online.barrons.com/public/page/barrons_econoday.html

• Monday: None
• Tuesday: 1) 9:00 am, Mar. Consumer confidence (27.0 up from 25.0);  2)  9:00 am, Jan. S&P/Case-Shiller home price index, (unchanged -18.5%);   3) 9:45 am,  Mar. Chicago PMI (34.7, up from 34.2);
• Wednesday: 1) 8:15 am, ADP employment change; 2) 10:00 am, Feb. Construction Spending (-1.6% up from -3.3%);  3) 10:00 am, Mar. ISM index (36.5 up from 35.8)   4) 10:00 a.m. Feb.  pending Home sales (-2.0% vs -7.7%);   5) 10:30 am, US Energy Dept Oil Inventories For Mar 27;  6) 2:00 pm. Mar. Auto sales.
• Thursday: 1) 8:30 a.m. Initial Jobless Claims For Mar 28 Week;  2) 10:00 am, Feb. factory Orders (-0.3% vs -1.9%;
• Friday: 1) 8:30 am, Mar. Av. work week (33.3 unch.); 2) 8:30 am. Mar. Hourly earning (0.2% unch.);  3) 8:30 am, Non-farm payroll (650 K); 4) 8:30 am, Mar. Unemployment rate (8.5% vs 8.1%); and 4) 10:00 am, Mar. ISM services index (42 vs 41.6).

Picks for Monday, March 30: The big question on every ones mind on Monday would be “whether the rally of the past 3-weeks is real, can I jump in or wait on the side lines”.  No major economic data or earnings releases are slated for Monday.  So, it would be somewhat challenging to predict how the markets would react.  I thought  Geithner did OK with his media appearances over the weekend.  But, it may not be enough to move the markets.  I’m going to wait it out.  I’ll not have any picks for Monday for our swing portfolio.  I’ll watch my positions with tight stops.

I will keep the following stocks on my radar through out the week for possible inclusion in swing portfolio or for day trading opportunities:

ORLY, NFLX, DRYS, DSX, IPI, MOS, MON, RIMM, AXP, BWLD, AMZN, WDC, MELI, FAS, WFC, BAC, MTH, IYT, COV, HUM, DE, ARO, FOSL, and GME.  Also, Gold (GLD, DZZ or DGP) and Gold mining stocks (XME, GOLD, AUY).  I expect some accelerated “directional” movement to occur with Gold and Gold related stocks in the next few days.

As in past few weeks, I expect considerable volatility associated with financial stocks.  So, I’ll be looking at the following for day trade opportunities:  FAS, WFC, BAC, and MS.

If there are questions or comments, please do post …..

Have a great week and happy trading.

TaurusTrader

http://www.taurustrader.wordpress.com

Stocks to Watch for Wednesday, March 25, 2009

Tuesday’s Market Recap:  Profit taking was the game of the day, especially at the open and at the last hour before closing!  This was quite expected after a big market rally on Monday.  Major indices briefly traded positive around mid-day after the testimony by Geithner and Bernanke to House finance committee over AIG issues.  Sellers came out in force toward sessions end pushing Dow down to 7660 or a loss of 116 points (1.5%).  All Dow components, except 3 ended in red.  S&P lost 16.9 points or 2.05% to close at 806, two consecutive days above 800 and also above 50 day MA.   Nasdaq fell 39.25 points or 2.5%, to 1516.

The dollar was mostly higher against other major currencies, while gold prices fell $28.8 or 3% to $923.30.

Oil gained 18 cents to settle at $53.98 a barrel on the New York Mercantile Exchange.

WSM hit its profit target this morning and closed for a nice 19.8% profit (please see my earlier post for details).  All three recommended picks for today, MELI, BAC, and HON, were bought and added to TaurusTrader swing portfolio.  None of the positions got stopped out.   At the end of the day, the portfolio had following open positions – WNR, TCK, AGU, AMR, MBT, FCN, MDR, HNT, RIO, MELI, HON, and BAC.

Among the day trade picks – FAS, BAC, WFC and MS gave great profitable setups.  As discussed in earlier posts, I follow 10-min chart for day trade setups.

Picks for Wednesday, March 25:   I expect the choppy trend to continue throughout the week.  Market movement has become increasingly news driven.  Unless some encouraging news comes out in the next few days, there is a possibility that all the gains made on Monday might disappear!  President Obama in his speech to the nation, in my opinion, spoke well and made a positive case in front of American public  for his policies and budget proposal.   

I made a case for a group of stocks in my blog on March 17.  These stocks are seeing some momentum building.  So, I thought the piece is worth repeating.  This is what I said on March 17 – “There are some positive signs that the economic activities around the word is showing signs of recovery.  I expect companies that make it happen in early stages are expected to benefit immediately, such as copper producers, dry bulk shippers, railway and trucking companies, etc.  Copper price is increasing which generally indicates increase in industrial and construction activities.  Shipping activities involving essential products across globe is picking up.  Further, I also think that Ag seed, chemical, and fertilizer companies will pick up momentum as planting season in North America is about to begin.  These companies will generate more than 60% of their revenues in the next couple of months selling seeds, pesticides, and fertilizers to farmers.  So, I’ll be keeping an eye on the following companies for the next few days” –

• TCK  – Producer of copper and other metals (TCK is up by over 10% since March 17)
• SBLK, DRYS – Dry bulk shippers.  SBLK reported good earnings after the markets closed on Monday. DRYS is again up over 10%.
• ABFS, YRCW, CSX, GBX – Railway and trucking,
•  AGU, SYT, MON, TITN, ADM – Ag seed, chemical,  fertilizer, and equipment companies
• WNR, VLO – oil refiners

TaurusTrader swing portfolio is well diversified and currently has 12 open positions.  I do not want to add any more new position until I close some.

I’ll closely watch the following stocks for day trade opportunities: FAS, BAC, and MS.

If there are questions or comments, please do post.

Regards,

TaurusTrader

http://www.taurustrader.wordpress.com

Stocks to Focus for Friday, March 20, 2009

Thursday’s Recap:  Rally faltered a little bit.  Markets declined for only the 2nd time in 8 days.  Financials lost steam and took the major averages down.  It is probably a good thing.  Banking sector had gone up too far, too fast.   XLF has been up over 60% in less than 2 weeks.  Some cool off was overdue.  XLF ended the day losing about 8%. 

Dow shed almost all the gains it made yesterday by losing 86 points or 1.2%, and closed at 7401.  Nasdaq lost 0.52% or 7.74 points to close at 1483.5, while the S&P 500 declined by 1.3% or 10.3 points to 784.

So, technically speaking…. looks like 50 day MA is the Achilles heel for major averages to overcome.

All three indices are at technically interesting juncture. Dow is 220 points away from its 50 day MA, which it has not crossed since January 7. Dow came very close to taking out 50 DMA on February 9, but it was flatly rejected. S&P has breached 50 day MA for two consecutive days now, but could not close above it.  S&P also has not closed above 50 DMA since January 6th.   Current 50 DMA for S&P stands at 794,  just 10 points away from today’s close.

Nasdaq has however, closed above 50 day MA for 2 consecutive days now.  But,  is barely above (by 22 points) the 50 DMA (1461).   It would be interesting to see whether Nasdaq would be able to hold above its 50 day MA in the next couple of days.

Is Dollar Worry Over Blown? – There were renewed worries about the greenback following yesterday’s fed decision to spend another trillion dollars to bolster economy.  Dollar declined against major currencies for 2 session in a row since then.  Dollar lost 4% against Euro in less than 24 hours.  That’s a big move.  This led to a bounce in commodities and commodity related stocks in today’s trading.  The CRB Commodity Index rose more than 5% (largest single-session advance by percent this year). Crude oil gained 6.5% to close at $51.25 per barrel.  Gold advanced by 7.8% to close at $958.50 per ounce.  Energy stocks (+1.4%) and materials stocks (+1.4%) also rose. 

In my opinion, the dollar related reaction to fed decision is a little over done.  US economy is still the strongest economy in the world despite all our problems.  Dollar is still the dominant currency.  People who are squabbling over greenback, should just look back a little.  Just 6 months ago, EUR/USD pair was trading at over 1.60.  Now, when it jumped from 1.30 to 1.35 or so, all hell breaks loose!  Very strong dollar in the past few months had hurt US companies doing business abroad.  An example is ORCL, which reported a great quarter yesterday.  ORCL beat the street estimate by 2 cents.  Still, ORCL numbers would have been 5 cents better if it were not for a stronger dollar.  So, relax folks.  A slight decline in dollar is not the end of the world as the dooms day pundits like Larry Kudlow and his friends on CNBC rant about.  The dollar is already stabilizing against the Euro and Yen as I write this blog around mid night.

TaurusTrader swing portfolio had a decent day.  AGU and TCK were bought and added to the portfolio.  None were stopped out.  Today’s gainers include – AGU, TCK, BX, MDR, CPRT, +WDCDV, BX, BMC, and WMS.  Stocks – MBT, WNR, and RY shot up at the open, but lost steam later in the day ending in red, along with AMR and FCN.  CPRT, RY and MBT came within just a few cents of hitting the target before retracing!!!

It was just one of those very rare days that I could not find a decent trading setup to day trade!  It is better NOT to trade when there are no trades to be made with confidence!!

Picks for Friday, March 20:  It is a tripple witching day for options.  Expect a very choppy session and the stocks to trade in a wide range.  I do not want risk picking any stock to go long at this kind of market condition.  However, I do want to ‘day trade’ precisely at this kind of market condition, and exploit the market volatility . 

I’ll focus on financial, energy, ag and commodity sectors for trading opportunities.  Some of the specific stocks that would be following are – FAS, WFC, MS, TNA, DIG, DUG, IPI,  AGU, and JOYG.

If there are questions or comments, please do post. 

If you are interested in receiving my posts directly via email, please email me at –  TAURUSTRADER@SBCGLOBAL.NET  or click on the ‘comments’ below to request.  I can do the rest!!

Happy trading ….

TaurusTrader

http://www.taurustrader.wordpress.com

Stocks to Focus for Tuesday, March 17, 2009

Monday’s Market Recap:  Four days of rally came to an end.  Stocks in some sectors, especially financial and technology, have gone too far too fast.  So, this pause (pull back!) is rather considered a good sign.  The day started great with Dow gaining over 150 points by mid-day with financial sector stocks flying high .  However, the sellers came out in the afternoon session and pushed the financial  and technology stocks down, and so went the major indices, down losing steam. 

Dow and S&P gave up all gains and ended the day almost flat.  It could have been worse.  Hey …. it was the anniversary of the fall of BSC which started all this mess!  Dow closed at 7217 (range 7206 to 7393) losing just 7 points or 0.1%.  S&P also had a similar trend, closing at 754 (range 753 to 774) losing 2.7 points or 0.3%.  Nasdaq shed a bit more, -1.9% or 27.5 points, and closed near day’s low at 1404.  For the day, Nasdaq traded between 1402 and 1445.

TaurusTrader added BX, AMR, and WFC to swing portfolio.  SOHU was stopped out.  Since the stop was raised over the weekend, we came out almost even with a loss of just 0.3%.  In fact, SOHU came within 20 cents short of hitting its target ($50.50) last Thursday.  So was CPRT, which came within 5 cents of target ($30.30) before retracing!  It is not fair …. but, I understand is just a part of vagaries of trading!   DRYS, added to the focus list on March 11, is dropped from the watch list.  It failed to hit buy limit within 3 days after placed on the list.

Among the day trade picks – FAS, BAC, and MS gave great profitable setups.  As discussed in earlier posts, I follow 10-min chart for day trade setups.

Picks for Tuesday, March 17:  It is a “triple winch” week for options.  I expect the choppy trend to continue throughout the week.  Market internals look OK.  It is likely that 741 (November 21 low) on S&P would be defended.  Please watch out …. there appears to be some sector rotation beginning to happen.  Money is moving out favored sectors like financial, technology, precious metals, etc in to less favored sectors, such as ag and fertilizers, air lines, shipping, refiners, etc. 

There are some positive signs that the economic activities around the word is showing signs of recovery.  I expect companies that make it happen in early stages are expected to benefit immediately, such as copper producers, dry bulk shippers, railway and trucking companies, etc.  Copper price is increasing which generally indicates increase in industrial and construction activities.  Shipping activities involving essential products across globe is picking up.  Further, I also think that Ag seed, chemical, and fertilizer companies will pick up momentum as planting season in North America is about to begin.  These companies will generate more than 60% of their revenues in the next couple of months selling seeds, pesticides, and fertilizers to farmers.  So, I’ll be keeping an eye on the following companies for the next few days –

• TCK  – Producer of copper and other metals
• SBLK, DRYS – Dry bulk shippers.  SBLK reported good earnings after the markets closed on Monday.
• ABFS, YRCW, CSX, GBX – Railway and trucking,
•  AGU, SYT, MON, TITN, ADM – Ag seed, chemical,  fertilizer, and equipment companies
• WNR, VLO – oil refiners

Swing trade picks for Tuesday are:

1. WNR – buy above $11.80, Target 13.60, Stop $10.95
2. TCK – buy above $4.41, Target $6.50, Stop $3.75
3. AGU – buy above $37.50, target 41.50, Stop $34.50

I’ll also closely watch the following stocks for day trade opportunities:

FAS, BAC, MS, VLO, MON, SYT, DUG, and SBLK (earnings play).

If there are questions or comments, please do post.

Regards,

TaurusTrader

http://www.taurustrader.wordpress.com

The Week Ahead, March 16 – 20, 2009.

Weekly Recap (March 9 – 13, 2009):  TaurusTrader’s prophecy to begin the week, ” ….  expect some bounce up for the markets this week ……. planning on exploiting any  ‘bounce ups’ as and when they happen …..”, did indeed come true.  It was not pretty to begin with on Monday, but Gosh, things changed in a hurry … when the rally started, it did not waste any time …. it just took off.  All major indices had substantial gains not seen in a while.  It was the kind of rally, no matter what you call – a bear market rally, reversal rally, short cover rally, Obama rally, anti-Obama rally, Bank CEOs rally, Stewart-Cramer rally, etc etc etc, that the TaurusTrader was waiting patiently, totally planned with right picks, and pounced on for profits! Please refer to my blog posts through out the week for details.  I hope you did well too.

For the week, Dow traded in 800 point range (6440 to 7243) to close at 7224 and gained an impressive 597 points or 9%.  S&P gained 10.7% or 73 points to close at 756.6 (range 673 to 758), a close above November 21 low of 741.  The tech heavy Nasdaq market gained 10.6% or 138 points for the week  closing at 1432 (range 1266 to 1434).

Major worries about the stability and viability of major banks were somewhat abated by upbeat statements by CEO’s Vikram Pandit of City, Jamie Dimon of JPM, and Ken Lewes of BAC – all indicated that their banks are lending and making profits!  Even though, the GE credit was downgraded by a notch to AA+, it did not hurt as the market was expecting even worse.  So, GE gained, instead of losing ground!  More importantly, the Obama administration has started talking ‘coherently’ and in unison about their plans for rescuing financial institutions and fixing economy.  Congressional hearing about modifications in mark to market accounting practice to deal with toxic assets on balance sheet of financial institutions, and SEC’s inclination to bring back the ‘uptick’ rule for shorting stocks, also added fuel to the rally. 

TaurusTrader’s swing portfolio had a fantastic week.  Five positions hit their profit targets within a short holding period of 1 to 5 days. 

1. WFC bought on Marck 9, sold on March 10 for 29.2% gain
2. BIGCC (BIG April 15 call), bought on March 6, sold on March 11 for 70% gain
3. WDC, bought on March 10, sold on March 12 for 11.8% gain
4. MS bought on March 10, sold on March 11 for 20.1% gain
5. JOYG bought on March 10, and sold on March 11 for 8.3% gain

None of the positions stopped out this week.

Because of wide intra-day price swings, we had several reccurring  profitable day trade opportunities throughout the week with our day trade picks – MON, AGU, IPI, SYT, BAC, WFC, MS, HP, HPQ,  FAS and MELI.  I had mentioned several of those trades in my daily posts.

Week Ahead, March 16 – 20:  Please do not kid yourself.  No matter what you hear from experts on CNBC, we are still in a historic bear market.  Negativism still exists, and is likely to persist for a while about the health of our economy, viability of financial institutions, political squabbling, etc.  Even in bear market, we get some burst of enthusiasm and positive uptrend periodically, like the one we got last week.  It usually is very fast and very violent!  Now you see it, you feel it, but the very next moment it is gone heading in the other direction … even faster!!  So, as I said before, be patient and be prepared to exploit those kind of movements as and when they happen.

I expect the markets to swing widely based on ‘instant news’.  There’s a lot of scheduled events that could move the markets in a blink.  It would be interesting to see how the markets would react to the ‘weekend news events’  – Ben Bernanke’s appearance on 60 minutes, OPEC’s decision to hold the oil out put steady, meeting of G-20 finance ministers, and contradictory statements made by Obama’s honchos on the health of economy at their news media circus acts!  

I liked Ben Bernanke on 60 minutes.  Thought he was forthright and heading in the right direction.  He was emphatic in asserting that the recession could end in 2009, and no big banks would fail under his watch.  Of course, there were caveats – the ‘political will’, mostly the lack of it and how soon the finanacial system can be stabilized.  In all, no harm done with this highly anticipated event!

Tim Geithnet did OK at the G-20 meeting …. No harm done here either!

OPEC’s decision to not to cut production came as a surprise that might affect energy stocks at the open on Monday.  As I write this, the crude was down by over 4% in Asian session.

Financial stocks might continue with their momentum from last week.  A few hours ago, the CEO of HSBC announced that his bank would not ask for British government bailout.  Banking stocks in Asia were responding positively to this news, as well as to the news from G-20 meeting of coordinated efforts to stem world financial crisis.

Economic calendar is busy for the week including some important releases –

• Monday – Empire State Mfg Survey (consensus – 32.00); Industrial Production (consensus, -1.2% month to month); Bernanke speaks.
• Tuesday – Housing Starts (consensus 450 K); Producers Price Index (PPI); FOMC meeting begins
• Wednesday – Consumers Price Index (CPI); EIA petroleum stats; FOMC meeting announcement
• Thursday – Jobless claims (654K); Leading Indicators (-0.6%); Philly Fed Survey (-38.0)
• Friday – Fed Chairman Ben Bernanke speaks

For complete economic calendar for the week, please visit:

http://online.barrons.com/public/page/barrons_econoday.html

On the earnings front, 93 companies are scheduled to confess their quarterly earnings this week.  For complete list, please visit:

http://www.zacks.com/commentary/10310/Earnings+Preview+for+Mar+16+-+20

Some anticipated confessions are –

• Monday – SINA, SBLK
• Tuesday – ADBE, CSIQ, GES
• Wednesday – CLC, DRI, NKE, ORCL
• Thursday – BKS, PLCE, CRAI, FDX, WGO

At the beginning of the week, TaurusTrader’s swing portfolio contained following positions:

1. RY- filled on March 13 @ $27.70, Friday’s close @ 27.65.  Unrealized gain -0.1%.  Target 30.50.  Stop $25.60.
2. MBT – filled on March 13 @ $28.35, Friday’s close @ 28.40.  Unrealized gain 0.1%.  Target 33.10.  Stop $24.30.
3. FCN – filled on March 12 @ $47.80, Friday’s close $47.63.  Unrealized gain -0.2%.  Target $52.00.  Stop $45.15
4. MDR – filled on March 12 @ $13.40, Friday’s close $13.98. Unrealized gain 4.1%.  Target $16.00.  Stop raised to $12.90
5. CPRT – filled on March 10 @ $27.60, Friday’s close $29.43. Unrealized gain of  6.7%.  Target $30.30.  Stop raised to $27.50
6. WDCDV (WDC April 12.50 call) – filled on March 6 @ <$3.00, today’s close $4.90, gain 63%.  Target $6.00.  Stop raised to $4.00
7. SOHU – filled on March 10 @ $46.17, Friday’s close $48.66.  Unrealized gain 5.1%.  Target $50.50.  Stop raised to $46.00
8.  BMC – filled on February 24 @ $29.46, Friday’s close $29.74.  Unrealized gain 1.0%.  Target $32.00.  Stop $27.49

I’ve raised the ‘stop loss’ for WDCDV, SOHU, CPRT, and MDU to protect profits and/or to reduce losses.

Picks for Monday, March 16:  Based on the news events over the weekend discussed above, I will be watching financial and transportation sector stocks on Monday.  I will also be watching the earnings release from SINA, and for possible price action to the report.  The stocks for swing trading are –

• WFC – buy above $14.10.  Target $16.20.  Stop 11.30 (Risky and very volatile, adjust your stop to your risk tolerance)
• AMR – buy above $3.70.  Target $4.85 (50%), and $6.20 (50%).  Stop 2.80 (you could also consider DAL or CAL)

I’ll be looking at the following for day trade opportunities:  FAS, BAC, MS, ITRI, MELI, ITRI and SINA (on earnings!).  Their chart patterns and volatility look interesting!

If there are questions or comments, please do post …..

Have a great week and happy trading.

TaurusTrader

http://www.taurustrader.wordpress.com

Stocks to Watch for Thursday, March 12, 2009

Wednesday’s Recap:  A gain is a gain however small it is.  In a rather choppy trading, major indices eked out small gains to close in positive territory two days in a row in over a month!   Dow closed up 4 points, S&P gained 1.7 points, and Nasdaq fared slightly better gaining 13.4 points.  Dow failed to clear 7000, ending at 6930, S&P closed at 721.4, and Nasdaq stood at 1371.6 by the end of the day.  The financial and technology sectors held up OK, while the energy sector gave up as crude dropped 7.4%.

TaurusTrader again had a great day!  MS gapped up at open, way surpassing our target exit price.  I closed MS position immediately after open at $22.68 for a profit of 20.1% in less than 24 hours.  BIG received an upgrade this morning, and our April 15 call (BIGCC) hit our target of $5.10, for a net gain of 70%  in 4 trading sessions.  I suggested buying BIGCC on Friday the 6th, for less than $3.00. 

Our picks for today, DRYS and MBT did not hit the entry limit, hence were not bought.

As of the end of March 11,  TaurusTrader swing portfolio had following positions:

1.  CPRT – filled on March 10 @ $27.60, closed today at $28.19 for an unrealized gain of  2.1%.  Target $30.30

2.  WDCDV (WDC April 12.50 call) – filled on March 6 @ <3.00, today’s close $4.30, gain 43%.  Target $6.00

3.  WDC – filled on March 10 @ $15.30, closed today at $16.57.  Unrealized gain 8.4%.  Target $17.10

4.  SOHU – filled on March 10 @ $46.17, closed today at $49.06.  Unrealized gain 6.3%.  Target $50.50

5.  BMC – filled on February 24 @ 29.46, closed today at $28.53.  Unrealized gain -3.2%.  Target 32.00

In the past few days, we closed out MS (twice), C, SWHC, JOYG, BIGCC, WFC, and MELI for some hefty gains.  At the same time we also took some losses from UYG, PALM, PBR and ATHR after being stopped out (Please refer to my earlier blog posts).

Focus list for Thursday, March 12:  Next couple of days will be pivotal that might determine the direction of the markets for the short run.  Number of market influencing events will be taking place – 1) Traders will be watching the congressional debate tomorrow on mark to market accounting practice, 2) Treasury secretary Tim Geithnerwill be testifying before senate budget committee tomorrow, 3) advance retail sales for February are due tomorrow, along with January business inventories, and weekly jobless claims data, and 4) G-20 meeting on financial crisis and to devise coordinated efforts to mitigate the crisis.

I’ll be watching the following stocks to add to TaurusTrader swing portfolio:

1.  FCN – buy above $47.80, Target $52.00, Stop $45.15

2. MDR – buy above $13.40, Target $16.00, Stop $11.50

3.  BX – Buy above 6.31, Target $7.50, Stop $5.40

Energy stocks might see some volatility heading in to OPEC meeting over the weekend.  Technology stocks are expected to gain more on advances already made.  Banking stocks might fluctuate widely during and after the mark to market congressional hearing.  Ag and fertilizer stocks are on tear, and I expect it to continue.  So, I’ll be concentrating on following stocks for quick day trade and swing trade opportunities:

HP, HPQ, MELI, WFC, JPM, UYG, MON, AGU, and IPI.

If there are questions or comments, please do post …

Happy trading ….

TaurusTrader

http://www.taurustrader.wordpress,com

MS sold @ 22.68 for 20.1% profit …. BIG call nets 70%

MS opened higher than our target exit price … I sold MS at the open for 22.68 for 20.1% profit.  If you remember, I bought MS yesterday at $19.70.  

BIG got an upgraded, and our call on BIG has hit the target 70% profit.  I sold BIG April 15 call BIGCC and closed the option position.

So, two trades for nice profits this morning ….. Great!!

TaurusTrader

Stocks to Watch for Wednesday, March 11, 2009

Tuesday’s Recap:  What a reversal of fortune!!  If we can string up a few more days like this …. I sure can dream of retiring!  It was a “hard to lose” day.  Pick any stock, it probably closed up.  If any one did not have a winner today, they need to check their stock picking skills … I’m serious!!

The markets were due for a bounce after such a prolonged over sold condition.  The time was ripe for some good news that the bulls could pounce upon!  It came from the City CEO Vikram Pandit before the markets opened.  He gave some rosy picture for City.  Who cares for the details!!  It was good enough for the banking stocks to rally!  Then came more news.  Congressman Barney Frank announced that SEC may consider bringing back the up-tick rule as early as next month.  Also, in the background, many traders were weighing on congressional committee meeting later this week to support temporarily relaxing the mark to market accounting rule for banks.  Race for short covering started in earnest providing more fuel to the rally as the day progressed.  This is the kind of day the TaurusTrader has been patiently waiting and ready for (please read my earlier blog, Week Ahead, March 9-13, 2009).

All three major indices saw substantial gains.  Dow ended up by 379 points (5.8%) to close at 6929, and Nasdaq fared even better picking up 90 points (7.1%) to close at 1358.3.  S&P rose by 43 points or 6.4% and closed at 719.6.  It was probably more than a short covering or dead cat bounce rally.  There was some indication of conviction buying.  The volume on NYSE was over 2 billion, which was higher than recent average volume.  Gains were wide spread across sectors.  Over 97% of S&P members advanced, and all 30 Dow components ended in green.  So, there could be more leg to this rally!

TaurusTrader had a great day with both swing and day trade picks.  WFC and JOYG hit their profit targets within 24 hours for 29.2 and 8.3% profit, respectively.  Four stocks triggered their ‘buy limit’, hence were added to the portfolio today.  They were – CPRT (added at $27.60), WDC ($15.30),  SOHU ($46.17), and MS ($19.70).  MR was dropped after being on the ‘buy’ list for 3 days without hitting the entry price.    Current swing portfolio holds 5 stocks,  BMC, CPRT, WDC, SOHU, and MS, along with two options, WDCDV (WDC April 12.50 call) and BIGCC (BIG April 15 call).

Our day trade picks for Tuesday also had a phenomenal day.  The financial picks – BAC (up 37.6%), WFC (up 23%), and UYG (up 28.5%), and Ag sector picks, MON (up 6.5%), AGU (up 8%) and IPI (up 9.6%) provided ample day trade opportunities. 

Picks for Wednesday, March 11, 2009:  I would keep a close eye on banking stocks, specifically – BAC, WFC, and MS.  They were already gaining from where they left off at close, in the after market hours.  Wednesday may see some more substantial gains for these stocks.  Energy, shipping, technology, mining, and ag sector stocks are also of interest.  I would focus on HP, DSX, MELI, IPI, AGU, and JOYG for any day trading opportunities.

Also, I would like to add the following stocks to TaurusTrader swing portfolio:

1.  DRYS – Buy above $4.65, Target $6.50, Stop $3.95

2. MBT – Buy above $28.35, Target $33.10, Stop $24.30

Good luck trading ….

TaurusTrader

http://www.taurustrader.wordpress.com

Focus List for Thursday, 03-05-2009

Wednesday’s recap:  At last a positive close … a welcome reprieve from onslaught of negative closings continuously for five sessions.   All three major indices made significant gains.  Dow gained 150 points or 2.23% to close at 6876.  Nasdaq ended the session at 1354, gaining 2.5% or 32.7 points.  S&P closed at 712.9 gaining 2.38% or 16.54 points.

Economic indicators released today did not surprise the markets as they all came in within market expectations.  The ISM Services Index for February was 41.6 vs 41% consensus.  According to the Fed’s Beige Book, the Fed does not expect a significant economic recovery until late 2009 or early 2010, again within the realm of market expectation.  The ADP Employment Report indicated that  697,000 jobs were lost in February. The consensus estimate called for 630,000 job losses.   The ADP does not have a good track record for accuracy, but generally tends to agree with the actual trend.  Unemployment data from labor department is slated to be released on Friday.

The biggest buzz however came from China which announced that it might spend another $550  billion plus in addition to the massive spending plan it already announced last year end.  Stocks in metals, mining, and energy took off with the news.  There were some good earning reports, especially from BJ, JOYG, and BIG.  At one point, Dow was up close to 250 points.  Financials struggled because of credit rating worries  with GE, WFC, and even JPM.  However, toward the end of the day financials pared some losses after the news that the congress would hold a hearing on mark to market accounting rules on March 12.  This is a very welcome news for banks as it might help them write down toxic assets from their books.  If this should happen …  Man, hold on to your seats …. some bank stocks might shoot up 40 to 50% or even more in a day!

Most of the stocks on our watch list had a great day.  All agriculture stocks -MON, SYN, AGU were up by 5 to 6%.  IPI was up by over 5%, but ended the day in a negative territory.  IPI will be releasing earnings tomorrow.

Among the retail stocks that I highlighted – BJ (7.2%) and BIG (17.8%) were up big upon good earnings report.  So did the home builder TOL.

BMC (-1.2%) and PALM (-4%) were losers.  MS gained over 8%.

Picks for Thursday, March 5:  We will have chain store sales, jobless claims, productivity and costs, and  factory orders data for release tomorrow.  I will be closely watching the retail sales numbers as I mentioned in earlier posts.  Some, especially discount and teen retailers, are expected to post better numbers.  Again, I will follow ARO and BKE.  Would be interesting to see what WMT does!

Following are my specific picks for tomorrow.  Unless, there’s a compelling reason, I’ll liquidate all trades before day’s end whether trades hit profit target or not. It is too risky to carry the trade on to Friday through unemployment data release, which may swing the market violently either way! I have two Chinese stocks, one mining, one investment bank, and one technology stock on my target for tomorrow’s trading.

1.  JOYG – Enter above $18.00, target – $19.50, stop $16.99.   (Reported good earnings Wednesday morning, plus riding high on Chines stimulus news).  You may also buy March 15 calls for about 0.50 cents premium above cost. 

2. WDC – Enter above $15.30, target $17.10, stop $14.48

3. MR – Buy above $20.50, Target $24.50, stop $19.45 (Earning’s play.  Reported great numbers and guided higher after the market close on Wednesday).

4.  SOHU – Enter above $46.17, target $50.50, stop $42.55 (very volatile)

5. MS – Buy above $19.70, Target $21.50, stop $18.25

ADBE pre-announced and narrowed the EPS range.  It was gaining in the after market hours and will be interesting to watch tomorrow.  If interested, it would be worth watching ag sector stocks also which are picking up momentum – AGU, MON, and SYT.  IPI will be releasing earnings tomorrow, and can see wide swings!

Have a great trading day ….. and good luck.

TaurusTrader

http://www.taurustrader.wordpress.com