Bill Cara: Cara's Daytrader Bull Board, Friday, January 12, 2007, 7:00 AM

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January 12, 2007

Cara's Daytrader Bull Board, Friday, January 12, 2007, 7:00 AM

First SAP, today it will be AMD. Do you recall how a few readers jumped on me a year ago when I put down AMD?

Btw, where is "dinov", the reader who chastised me on Jan 31 a year ago when I warned about "chip and dip." He was proudly claiming that his favorite AMD ($41.40 at the time) was the beast that had reduced Intel to its knees? I don't think he liked it when I stuck to my guns, pointing him and others to venerable old INTC, which is the symbol for Cara 100 Intel ("Inteller" I call it because it's a cash machine.)

Today, this morning actually, AMD is $20.18. Later it'll be a teenager. Wall Street has eaten your lunch, Dinov.

When the chips are ready to start rising from the dip, I'll join the party " with INTC of course. It won't be Samsung, because even by Korean accounting standards, net profits dropped -8 pct in the 4Q06.

ORCL didn't look too good after 3pm did it? And how about MOT? I haven't seen Mr. Zander touting on CNBC lately.

And for all you Apple Bulls, the WSJ is reporting that: "Apple revealed that CEO Steve Jobs recommended "favorable" dates for stock-options awards, but said he was absolved of misconduct by an internal probe." Last time I checked, no internal staff had ever sent a CEO on a perp walk. Wouldn't that be something? "Jobs gets jobbed by internal probe!" Traders never knew how much comedy there is in the stock market. And you thought the bond guys were having all the fun?

Yesterday, I gave you the heads-up from Shanghai Fly. Overnight the Shanghai Composite plunged -3.7 pct. It seems the PBOC central bank chairman has warned the commercial banks about margin loans for stock investing. Seems I mentioned that concern yesterday. Maybe the Fly was on the wall of Mr. Joe. Actually, I have to pay the man his due, he is a Dr. Joe " [Zhou Xiaochuan is Governor of the People's Bank of China.]

Hong Kong and Japan were very strong. Yesterday, but not for the past week! For the past week, they were very weak!

The oils and miners have probably bottomed out here (short-term cycle) because Dr. Ben doesn't listen to Dr. Joe, and he wants equity prices to keep heading north. As he cranks it out, bond yields are grinding north too. Gold ought to do well today.

Figuring that Strombopolous Cramer might be in the house (they see him everywhere), some yahoos fired an anti-tank rocket at the U.S. embassy in Athens Greece. Talk about a senseless act!

I'm referring to CNBC's Cramer putting out the word on Crystallex (Sell, Sell, Sell!), I say Not, Not, Not! Waving a photo of Chavez, while shouting Sell, Sell, Sell! is like watching crazed persons in the Middle East burning Bush in effigy. I mean really, Jim.

Yesterday, the Dow (+72) hit an all-time record and the Nasdaq (+25) was also flying. Only Energy (XLE) was down, which some traders say was the boost to the market, with Crude Light touching a low of $51.88 (lowest close since May 2005). Today, $WTIC and XLE goes up, so what will these same traders be saying? The Broker-dealers (XBD) were printing money " Cara 100's GS and LEH hit intra-day highs. Toppy, I think. Homebuilders (XBH), like Cara 100's TOL and HOV were putting up a few houses (+1.6 pct), but I don't think that crisis is anywhere near over. Airlines (+2.7 pct) were on schedule yesterday because oil prices were falling. But what happens today when oil prices rise?

Actually, yesterday was so good to the Bulls, let's take a snapshot for posterity.

Interactive links

Econoday economic calendar

Asia-Pacific indices

European indices

$USD Index

U.S. Treasury Bond Mar. contract

NYMEX Oil Feb. contract

Gold spot chart

Silver spot chart

Platinum spot chart

Palladium spot chart

$CRB Index

Open Futures Contracts

Goldminer stock watch

In Focus

Here is the End of Day RSI-7 values prepared by "David" using Welles Wilder smoothing that tends to eliminate or at least reduce erratic, non-smoothed numbers calculated by Investertech.

RSI > 70 (Top 12 of 21) in Cara 100

RSI < 30 (Bottom 12 of 15) in Cara 100

The golds and oils are looking technically interesting and the techs have enjoyed their run. The oil stocks will likely follow Crude Light back up.

Yesterday's portfolio movers from the Cara Watch List:

Here are the top gainers on the day (other than KRY, of course).

Interactive charts of the top 12 Watch List gainers (Interactive link)

Here are the top losers on the day.

Interactive charts of the top 12 Watch List losers (Interactive link)

Interactive charts of the 52-week Intra-Day Highs or Lows in Cara 100

Wall Street upgrades

Wall Street downgrades

I see that the "Gold"man Sachs upgraded BHP. I wonder if that was decided AFTER they changed the commodity index.

Posted by Posted by Bill Cara on January 12, 2007 07:00:59 AM | Category: Cara's Bull Board

Discourse

iPhone faces uncertain market
Market for high-end smart phones is relatively small and Apple's price is higher than average

http://tinyurl.com/yk7op7

Posted by: NYUgrad at January 12, 2007 7:11 AM [link]

Bill,

Hey, man-that's two calls you've pretty much nailed to the day: into XAU 10/16/06, and out of China 1/11/07. Will take your comments today and add to XAU/rotate into OIH for a trade.

Posted by: 2nd_ave at January 12, 2007 9:05 AM [link]

Golds had a great start in the first hour. The Feb futures are up $5.20.

Now I can go to bed. Haven't slept since Wed. Got a sore throat on Tuesday night that got really bad. Buckley's Original Mixture is ok except it tastes like what I figure would come out of a World War 2 fuel drum.

Posted by: Bill Cara at January 12, 2007 10:36 AM [link]

I've noticed an anomaly in recent days with HB stocks. The ten-year keeps inching up inexorably, yet the HBs have been relatively strong -- albeit coming up from recent weakness.

No doubt this has to do with the mortgage application report this week. But I remain very dubious about the housing market getting any better for builders.

Posted by: number2son at January 12, 2007 12:00 PM [link]

Corn was limit up today. Apparently USG estimates
were waaay off. Geee bad numbers....so unusual.
Adds to inflation....helps PMs.

Posted by: DollarBill at January 12, 2007 12:12 PM [link]

Dollar Bill and others - If you think oil may be bottoming and would like some other commodity exposure like corn, don't forget to look at DBC, it has them and more in futures form.

Not a recommendation, simply trying to help/save you some time. Coulc be a big loser.

Also, looks like shorts in gold and gold miners are getting squeezed today. With the long holiday, I would bet that some traders are getting out (leaving work early) this a.m. not wanting to be short into the long holiday.

Disclosure: I put my toes in this a.m. on the opening for a new/albeit small DBC long.

Posted by: g034 at January 12, 2007 12:50 PM [link]

Hint for SEC : CEO asks for $1/year salary.

Posted by: ghosalb at January 12, 2007 12:55 PM [link]

g034,
I like the weekly chart on DBC. It is at a near -3.0 Bollinger Band that it bottomed at before. Possibilities for a reversal but the trend is still down, lower highs and lower lows. DBA is moving with the ag report. Maybe a better play on the ag sector. 25% weighted in corn, wheat and soybeans.

Posted by: stktrader at January 12, 2007 1:22 PM [link]

g034

Oil maybe rebounding from oversold and go down
more later but grains look to be in real short supply.

Jan. 12 (Bloomberg) -- Wheat futures surged the maximum allowed by the Chicago Board of Trade on speculation that supplies will drop as U.S. farmers plant more corn, which jumped to a 10-year high today.

Jan. 12 (Bloomberg) -- Cotton prices rose the most in two weeks in New York on speculation a grain rally will prompt farmers to plant more corn and wheat.

Corn prices jumped the highest in 10 years after the Department of Agriculture said U.S. reserves will fall to the lowest since 1996. Wheat gained on the prospect of lower supplies as farmers opt to plant more corn. Cotton rebounded, even after government data signaled less demand for the fiber.

http://www.bloomberg.com/markets/commodities/cfutures.html

Posted by: DollarBill at January 12, 2007 3:02 PM [link]

Re: dinov

When I began to spend significant time following markets, I bought some Royal Appliance, which promptly doubled. (it was a takeover) (though the same phenomenon happens to beginners at casinos, I've heard) Of course, I thought of pointing out on the Bill Cara site how brilliant I was and what a numbskull he was, since none of his 100 did so well in the short time window. But I refrained.

Man, I hate when people do that! If you want a chest thumping site, there's plenty of them around. I keep coming here because I learn a methodology, along with some heart, and Bill deserves every accolade he gets.

Posted by: tom sheepngoats at January 12, 2007 4:01 PM [link]

BTW, Moab, that was a helpful post re: Chavez. Thanks

Posted by: tom sheepngoats at January 12, 2007 4:05 PM [link]

I just sense an increase in volatility in most asset classes (from FX to commodities, EM shares and UST) There is one exception, ths US stock market with the VIX at 10.15 at the close.

Needless to say, 4.90 in TBills is good enough for me at this point. I just think that this market is overextended -- but I have been saying that for three months now...

I can see oil trading with its fundamentals soon -- i.e. higher price

Posted by: JP at January 12, 2007 5:49 PM [link]

Dollar Bill
Jim Rogers has been saying for some time that the next commodities bull will be in the "soft" coms.
A global slowdown might spoil the appetite for commercial commodities, but everyone (including the thousands being born as I write) will have to eat.
I agree with stktrader that the best way for those of us who don't trade commodities is the new ETF from Powershares, DB Agriculture (DBA).
It is a very new issue and is thin traded (so far), but considering it's DB authorship, I think it will be a winner.
Up 8% today.
Speaking of new ETF's, streeTracks has come out with RWX the very first International Real Estate ETF.
International real eastate...hummm.
Duisclosure: positions in both.

Posted by: Rigdon at January 12, 2007 6:30 PM [link]

g024 / Rigdon

I will check out DBC DBA for sure.

I also like Uranium and URZ has
a nice cup and handle forming.

Cheers

Posted by: DollarBill at January 13, 2007 6:59 AM [link]

January 12, 2007

Cara's Daytrader Bull Board, Friday, January 12, 2007, 7:00 AM

Discourse

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