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TNA: I'll be risking it as well. Picked some up yesterday, and a little more this morning.
Good read. Thanks for the post. Scary stuff as usual.
MCP, DECK, EQT, NDSN, GMCR Among Charts to Watch
Molycorp, Inc. (MCP), unfortunately, is among that list. It broke a little flag and cracked on Wednesday, dropping 3.96 to 24.04, or 14.14%, on 7.67 million shares, and increase in volume, while most of these stocks were low in volume on Wednesday. There’s some support around 21 that may be tested shortly, which could give this stock a 3-point raise potentially.
Deckers Outdoor Corp. (DECK) formed a rising head-and-shoulder over the last several months, cracked with a breakaway gap, bounced, and then came down on Wednesday, dropping 2.64, or 3%. It looks like it could crack again at this point into the low to mid-70’s.
EQT Corporation (EQT), with it’s massive top formation, dropped, gapped up, stair-stepped it’s way back down, started back up again, but formed a bear flag near the moving average, and dropped again on Wednesday, down 1.28 to 54.66, or 2.3%, on low volume. If it gets just underneath the moving average, it could drop to 47 - 48 very quickly.
Nordson Corporation (NDSN) looks extremely bearish. It’s massive top in July up around 59 was broken, a double-top multi-month wedge that formed in the 49 zone was broken, it rolled over hard in the last week and a half, reaching the 39 area at one point. It formed a little bear wedge that took it up a few points, however, on Wednesday it dropped 84 cents to 40.38. It looks like it’s about to crack and retest the October lows around 37, and may potentially run all the way down to the 32 - 33 zone.
Green Mountain Coffee Roasters Inc. (GMCR) continues to look ugly. In the last four months, this stock has gone from nearly 112, all the way down to 46. During that time, it broke hard, wedged, broke hard again, wedged again, and broke hard one more time. Now it's formed a little bear pennant. If it cracks to the downside, this stock could rollover, and rollover hard, right into the low 30’s. Keep an eye on this stock.
Other stocks in our Charts for the Day are Kraton Performance Polymers Inc. (KRA), HollyFrontier Corporation (HFC), Magna International, Inc. (MGA), Bunge Limited (BG), Abercrombie & Fitch Co. (ANF), BMC Software Inc. (BMC), Franklin Resources Inc. (BEN), Waters Corp. (WAT), wpi, FactSet Research Systems Inc. (FDS), and Green Mountain Coffee Roasters Inc. (GMCR).
http://www.advicetrade.com/chartsoftheday/MCP-DECK-EQT-NDSN-GMCR-Among-Charts-to-Watch-20111228852.html
Nice video of his charts.
Italy bond yields fall, 10-yr not far from record high
Dec 29 (Reuters) - Italian bond yields fell from recent record highs at auction on Thursday but cautious investors still demanded a near 7 percent yield to buy 10-year paper, a level seen unsustainable over time for the euro zone third-largest economy.
An injection of longer-term liquidity from the European Central Bank and a new Italian budget package this month have eased pressure on shorter-term debt, but longer-dated bonds still pose a challenge for Italy ahead of large redemptions early next year.
Italy raised around 7 billion euros on Thursday in thin holiday markets after a well-bid short-term debt auction on Wednesday. The Treasury had planned to sell between 5 billion and 8.5 billion euros of bonds.
On Thursday, Italy paid 5.62 percent to sell new three-year debt -- a much lower yield compared to a euro lifetime high of 7.89 percent paid only a month ago.
The fall in the three-year yield comes after the bill sale on Wednesday saw six-month funding costs halve from a month earlier.
The 10-year yield fell to 6.98 percent from a euro lifetime record of 7.56 percent at an end-November sale.
http://www.reuters.com/article/2011/12/29/italy-bonds-auction-idUSMAT01243020111229
Bond sale puts Italy to the test
Italy faces a crucial test tomorrow as the technocrat government of Mario Monti launches its first big auction of long-term bonds since a disastrous upset a month ago.
The outcome will set the tone for a string of debt sales through early 2012 that risk stretching the eurozone bond markets to breaking point.
The EU authorities are hoping commercial lenders will use last week’s flood of cheap liquidity from the European Central Bank to soak up southern European debt and bring yields back under control, starting with Italy’s €8.5bn (£7.1bn) sale of 10-year bonds today. The country must raise €440bn in debt in 2012, beyond the current fire-fighting power of Europe’s bail-out machinery.
Rome managed to sell €9bn of six-month bills at 3.25pc yesterday – half the rate paid in near-panic conditions last month – but there was no follow-through to longer-term maturities and the rally in Europe’s equity and credit markets quickly spluttered out. “Even bankrupt states like Greece can sell bills: what matters is the long end of the credit curve, and this hasn’t moved much,” said Jacques Cailloux, Europe economist at RBS.
The German DAX index and Spain’s IBEX both fell 2pc, and the Dow Jones was off 1pc in New York in early trading. The euro fell sharply to almost €1.29 against the dollar, the lowest since January, as markets digested news that eurozone banks had parked a record €452bn in overnight deposits at the ECB for safe-keeping on Tuesday.
The flight to safety exceeds the most extreme moments of the Lehman crisis in 2008. Although the picture may have been distorted by the Christmas holiday, it is clear large parts of Europe’s financial system remain under acute stress.
The interbank lending market is broken. The ECB is having to step in as intermediary to do the lending that banks won’t do for each other,” said Mr Cailloux.
The ECB lent banks €489bn last week at 1pc for three years in an unprecedented long-term repo operation (LTRO) to head off a credit crunch, but the level of fear remains so high that the banks have in effect lent the money back to the ECB at just 0.25pc (annualised) for a small loss.
Europe’s politicians had hoped that lenders would use a chunk of the ECB funds to carry out a back-door rescue of eurozone governments in trouble without breaching the ECB’s legal mandate. Italian, Spanish, and French banks have all been under political pressure to buy their own government debt, and take advantage of the fat yield spread on offer known as the “carry trade”.
Bundesbank chief Jens Weidmann described the ECB operation as “bridging help” for banks to keep them going until the sovereign debt crisis abates. “We think household income will rise 3pc next year, so it is not as if the world is collapsing,” he said.
In Italy, Mr Monti won senate backing for €30bn in austerity measures last week but it is far from clear whether investors believe that this can alone lift Italy out of its debt trap – or even if it is the right policy at all.
Italian bank Intesa SanPaulo said fiscal tightening will equal 3.6pc of GDP in 2012, pushing the economy deeper into recession. The business lobby Confindustria said the economy will contract by 1.6pc next year, and concerns are mounting that the shock therapy will cause tax revenues to plunge and prove largely self-defeating.
The latest package includes a petrol tax, duties on luxuries, a financial stamp tax and a property levy of 0.4pc on first homes, but so far lacks the structural reforms and labour shake-up needed to help Italy cope with the rigours of euro membership.
In Spain, home loans plunged by 44pc from a year earlier, the sharpest fall since modern data began. It is a reminder of how hard it will be to clear almost a million unsold properties. Luis de Guindos, a former Lehman banker now serving as economy minister, warned that Spain is on the cusp of a double-dip recession. “Make no mistake, the next two quarters are not going to be easy,” he said.
http://www.telegraph.co.uk/finance/financialcrisis/8981570/Bond-sale-puts-Italy-to-the-test.html
MCP: below 20, and it looks like 15 is the next stop. Thanks for bringing this one up again. I meant to set an alert for the 26 break, but apparently didn't.
Italian Debt Auction
Italy today sold 9 billion euros ($11.8 billion) of six- month Treasury bills at half the yield it agreed to pay at an auction of the securities last month. The Rome-based Treasury sold the 179-day bills at a rate of 3.251 percent, down from 6.504 percent on Nov. 25. Demand was 1.7 times the amount on offer, compared with 1.47 times last month.
Italy also sold 1.733 billion euros of 2013 notes today to yield 4.853 percent, compared with a yield of 7.814 percent at the last auction on Nov. 25. The bid-to-cover ratio was 2.24, compared with 1.59 last month. Tomorrow Italy will auction four different securities, including a 10-year bond.
http://www.bloomberg.com/news/2011-12-28/european-stock-index-futures-drop-before-italy-sells-debt-areva-may-move.html
edit: 10yr down to 6.86
http://www.bloomberg.com/quote/GBTPGR10:IND
A contrarian sentiment view to the previous article. Can't say I'm not fair and balanced.
The pieces are falling into place for a move to the October lows.
http://www.zenpenny.com/?p=3264
I enjoyed Hickerson's other most recent entry as well.
Low Volume Christmas Rally Continues
http://www.advicetrade.com/nightlyreport/Low-Volume-Christmas-Rally-Continues-20111224721.html
Keeping it Simple - Day Trade Rules, a Pathway to Financial Security
http://www.advicetrade.com/nightlyreport/Keeping-it-Simple-Day-Trade-Rules-a-Pathway-to-Financial-Security-20111225722.html
A nice read IMO.
Sentiment Cycle Update and Holiday Wishes
http://lasertrader.wordpress.com/2011/12/24/sentiment-cycle-update-and-holiday-wishes/
PARL: +94% AH. Most excellent. Congrats. <VBG>
Right back at you MB. All the best to you and yours.
And a Happy Holidays to everyone else as well!
FIO .... thanks Ico. Would be nice to have one last dash. Will take off half before close and let rest ride over the weekend.
SYUT: didn't realize it was a chineser. enough said.
SYUT: Nice volume today, and break of the DT line. Any idea what's up with this one?
DECK: nice reversal today. Glad I didn't HANSit earlier. Still looking pretty weak.
HANS: covered earlier at $93 for a small loss. still holding FIO, but will probably sell half if it maintains its gains today.
HANS: went short a few minutes back @ 92.85. Thanks for the links.
Italian 10yr yield creeping over 7%
http://www.bloomberg.com/quote/GBTPGR10:IND
Financial Stocks Still Suck – Heres Why
http://dragonflycap.com/2011/12/23/financial-stocks-still-suck-heres-why/
On the ECB’s Long-Term Refinancing Operation and 2012 macro ideas for investors
http://www.creditwritedowns.com/2011/12/on-the-ecbs-long-term-refinancing-operation-and-2012-macro-ideas-for-investors.html
Good read IMO.
The headline should just read "Biploar response to ECB loans accelerates at faster than normal pace". Sheesh.
Thanks for the link.
Yields on Italian and Spanish 10yr edging up. TED spread and LIBOR edging up as well.
http://www.bloomberg.com/quote/GBTPGR10:IND
http://www.bloomberg.com/quote/GSPG10YR:IND