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The Spear Report
Professional Edition for 07/02/2009
Vol. 6 Number 124

Bulls Hang Tough

COMPANIES MENTIONED TODAY

Symbol  Company Name           PWR     #Recs   Close$   
 AAPL    Apple Inc              30.5    4       142.43   
 ANAD    Anadigics Corp         0.0     2       4.19     
 ANR     Alpha Natrl RES        22.75   3       26.27    
 BIDU    Baidu.com ADR          29.25   4       301.09   
 CGA     Corus Group PLC        6.75    2       8.09     
 CHS     Chicos FAS Inc         4.5     2       9.73     
 EV      Not in Consensus       NA      NA      26.75    
 IAG     Iamgold Corp           7.5     2       10.12    
 INTC    Not in Consensus       NA      NA      16.55    
 RGLD    Royal Gold Inc         -0.75   2       41.69    
 RIMM    Not in Consensus       NA      NA      71.09    
 TBT     Not in Consensus       NA      NA      50.92    
 TIVO    Tivo Inc               1.25    2       10.48    
 TROW    Not in Consensus       NA      NA      41.67    
 T       AT&T Corp              18.25   3       24.84    
  
 MODEL PORTFOLIO 
  
 Todays Trades 
 Sym      Action   Limit     Trigger   Stop     Stop Type   Current 
  
 Current Holdings 
 Sym      Ent Date   Dir**   Entry    Current  Perf %   Stop     Stop Type 
 ANR      05/15/09   L       26.86    26.27    -2.2     NA       Intra-day 
 Notes: coal play 
 TBT      06/01/09   L       54.38    50.92    -6.4     NA       Intra-day 
 Notes: Inverse leveraged T-bill yield 
 CGA      06/05/09   L       8.05     8.09     0.5      NA       Intra-day 
 Notes: China Green Agriculture 
 BEN      06/23/09   SS      69.25    72.01    -4       73.60    Intra-day 
 Notes: Leading Financial 
 RIMM     06/26/09   SS      69.12    71.09    -2.9     72.75    Intra-day 
 Notes: Selling Short now 
 ANAD     06/29/09   L       3.97     4.19     5.5      3.70     Intra-day 
 Notes: nice dip 
 TIVO     06/29/09   L       11.00    10.48    -4.7     10.25    Intra-day 
 Notes: Nice dip 
 RGLD     06/29/09   SS      42.96    41.69    3        46.25    Intra-day 
 Notes: Going short now 
  
 **Direction: L = Long,     SS = Short Sale **

TRADE NOTES

OVERVIEW: On Wednesday the bulls pushed back and managed to
close the Dow up 57 points. The market is weakening under the
surface, however, and we are anticipating a down draft
early this month. Today’s jobless data will be catalytic.

OPEN POSITIONS:

This range bound market is not a particularly good environment for
swing trading. We are getting stopped out of both shorts and longs.
We will be reducing the number of positions for a while.

Longs:

(ANAD) paused, while (TIVO) recovered 2%.

(ANR) gave back 4% and (CGA) gave back 2%.

(TBT) was up fractionally.

Among the shorts:

(IAG) popped dramatically on Wednesday and stopped us out for
a small loss. The (RGLD) position remains OK.

(CHS) stopped us out, but (RIMM) began to move in our favor.

(EV) spiked higher and stopped us out. (TROW) hit the stop to
the penny and then reversed. .

Now that we are mostly out of our short positions the market should
finally go down.

NEW BUYS/SHORT SALES:

None.

WATCH LIST:

We present our Watch List stocks as potential trade ideas for
aggressive traders who wish to do more research on the stocks.

POTENTIAL WATCHLIST SHORTS:

AT&T (T). The stock has vastly underperformed its peers on this
rally off the March lows and has $60 billion in debt.

POTENTIAL WATCH LIST LONGS:

Manitowoc (MTW), which makes agricultural machinery. The
Semiconductor ETF (SMH). Apple (AAPL) and Bidu (BIDU).

COMMENTARY

The bulls pushed back against the skeptics on Wednesday and
managed to close the Dow and S&P 500 in positive territory, but the
indices faded markedly towards the end of the day.

Conditions are particularly choppy, as bulls and bears seem equally
strong at this juncture. News that the Institute for Supply
Management (ISM) manufacturing index advanced a couple of points
was the excuse for the morning rally, even though the headline
number failed to meet consensus estimates.

Strength came from tech and consumer staples, an odd combination
that reflects the general state of confusion about market leadership.
Intel (INTC) broke out of a solid base, as did Kraft Foods and
Pepsi.

The big news today will be the June employment report from the
Labor Department. The decrease in job losses in May to 345,000
from April’s 504,000 figure was instrumental in supporting the green
shoots rally.

Index futures are slightly weak ahead of the data. If June’s figure
tops 345,000 it is likely to throw cold water on the rally. If it is less,
then expect a surge of panic buying. The number will be released at
8:30 am ET.

MARKET CALLS

The S&P 500 has the markings of a possible Head and Shoulders
topping pattern. It would take a close below the May lows for this to
become the organizing pattern, however.

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SML- S&P SmallCap600; MDY= S&P MidCap 400 tracking stock;
SPY= S&P 500 tracking stock; QQQQ= Nasdaq 100 tracking stock.

(+) or (-) signifies a change in status today.

Short-term Market Direction:

S&P 500: Up

Intermediate-term Market Direction:

S&P 500: Up

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