Gold traded lower on Friday, moving towards a third straight week of losses on the heels of a recovering, better then expected, US economy. This caused investors to put their money in other “risk-on” assets like equities,etc. ES average trade size has drifted notably lower and was its lowest in nearly a week today suggesting a decrease in institutional buying. Can this indicate that we are close to a near-term “top?” Also, investors will keep a close eye on the steepness of the VIX Yield Curve and not so much the deceiving, low, front month prices. Industrial Production Misses and capacity utilization declines for the first time since early April.Industrial production was unchanged in February after having risen 0.4 percent in January.
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Movers and Shakers (BAC) Up $0.17, 3.19% to $9.54
Chart Glance- After BAC formed a double bottom on Dec 19th 2011, BAC has been off to the races. BAC looks to be forming a broader, reverse head and shoulder-type pattern. BAC is making “higher/ highs” and “lower/ lows.” Technicals indicate that BAC is in the early stages of breaking higher and is currently in a tight bullish flag. Alex Bernal has a price target of $11.00. There seems to be a lot of resistance/sellers around the $9.60-$10.00 range.
50 DMA ($7.65), 100 DMA ($6.74), 200 DMA ($7.58).
Support 1: $7.95 Support 2: $6.54
Bank of America’s stock rages after passing stress test. This is the highest BAC has traded in the last 7 months. Federal Reserve Stress Tests confirmed that BAC has improved its capital levels.Bank of America Corporation announced a few days ago that the Board of Directors authorized a regular quarterly dividend of $18.125 per share on the 7.25 percent Non-Cumulative Perpetual Convertible Preferred Stock. After showing it was able to pass the stress test, Bank of America could be in a position to ask for a modest dividend increase next year but no share buybacks. BAC needs to keep accumulating capital to meet so-called Basel III capital standards.. Under the stress scenario, the Fed said Bank of America would have net revenue before loan-loss provisions of $40.1 billion, behind JPMorgans ($59.3B)
By Greg Zimny
Morning Rage 3.16.2012
STI was up more than 9% in two days. MS soared 4.5%. Financials once again had the most upside OTM Call buying. BAC is now up more than 13.6% from Pre-JPM-dividend news, while GS and C trade up only slightly higher around 2%.
Will growth will be affected by inflation? Gas prices are at all time highs!
Is China pricing in a hard landing? The Shanghai composite is very close to breaking its 50DMA. Chinese yuan is down more than 3.5% YOY. China reports larger than expected trade deficit numbers. China Trade deficit hit 31.5B. China imports jumped 40% YOY. IF we arent in a Chinese hard look for continued Call buying in FCX,etc. If u think copper prices recover to the 4$
USD gets stronger–>will affect commodity stocks–>help shanghai index.
Apple opened and hit a fresh All Time High at 601.10 in trading on Thursday.We removed Apple from our SOLAR list following more than a 50% profit.
By Greg Zimny
Movers and Shakers (STI) Up $15.20 (4.79%) to $24.74
50 DMA ($21.68), 100 DMA ($19.87), 200 DMA ($20.71).
Support 1: $21.87 Support 2: $19.87
STI fell short in the Fed’s stress test a few days ago, but shares swing in the green as investors focus on the last sentence of the STI’s press release: “Sun Trust’s improved earnings momentum has continued in the first quarter of 2012 and is expected to result in earnings per share that exceed the first quarter First Call mean estimate.” The question that every STI investor should be asking is what happens to those massive assets if the economy is much stronger than current estimates project.The answer is likely much higher earnings,and thus profit. STI bank failure is no longer on the table. However, STI will have to probably wait to raise dividends and to repurchase stock.
Halftime Report for 3.15.2012
Suntrust is up over 9% in just a few trading days as it passes Fed Stress Tests. &P says that it is impossible that any economic improvement would bring back the AAA rating. U.S., U.K. AGREE TO EMERGENCY OIL STOCKS RELEASE, REUTERS SAYS
AAPL opens at $600.01 on strong opening-gap-ups and up over 5% from yesterday’s intra day lows. Yesterday, Apple saw strong, upward, call buying yesterday and the average trade size was considerably higher suggesting retail investors are jumping in as the professionals are covering. Parabolic moves always end with? Apple today announced the new iPad, the third generation, will arrive at Apple’s retail stores and the Apple Online Store (www.apple.com) on Friday, March 16 at 8:00 a.m.
Economic Data:
Initial Claims: 350K vs 356K
Empire Fed: New Orders 6.8 vs 9.7 Est.
Prices Paid explodes to 50.62, 25.88 previous. One of the largest increases on record.
By Greg Zimny
CBOE TV Interview 3.15.2012
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Morning Rage 3.15.2012
Today’s Economic Events:
Initial claims
empire manufacturing
PPI
Philly Fed- reflation in global capital markets.
Halftime Report for 3.14.2012
ECB increased margin calls on European banks by EUR163M this week to another record high. Is that perhaps the reason for the Gold sell off as Central Banks liquidate Gold to cover margin calls?
Apple has a larger market capitalization ($542 B), than the entire US retail sector. GO FIGURE!! Apples chart glance looks like a Roller Coaster ride that is going to the Moon. P A R A B O L I C. Apple was added to MS best idea list today because of media tablet 2012 increased projections.
By: Greg Zimny
Movers and Shakers (AAPL) Up $15.20 (2.9%) to $583.24
50 DMA ($479.93), 100 DMA ($435.37), 200 DMA ($415.69).
Support 1: $575.18 Support 2: $550.04
Apple is now bigger than the entire US retail sector with market capitalization (at $542 billion and counting). Apple was added to MS best idea list today because media tablet shipments outpace fourth quarter targets. Also, Morgan Stanley increases Apple stock price target to $720. iPad3 goes on sale in the U.S. and nine other countries this Friday at 8 a.m. local time, Apple announces on Wednesday. Also, their is a rumor that Apple will launch 15″ MacBook Air this April.
Interesting Apple data:
25B iOS apps downloaded worldwide.
15.5M ipads sold in Q4 2011.
$400 reduced starting price for iPad3
By: Greg Zimny