Soon, you know, we’ll be talking of wage inflation. How do I know? Amongst other sources, the airlines told me. The fact is there isn’t an airline in the world that can make a profit at $130 oil or even $100 oil, and possibly not above $80 oil. The fact is the world absolutely needs airlines; they cannot all go bankrupt. But, in order to put bodies in the seats, people will have to pay the price these airlines need to at least break even. At $130 oil, the issue is irrelevant since enough people cannot pay the tab to keep these airlines operating. Even at $100 oil, people will require higher personal earnings to manage that. Ergo, wage inflation is on the horizon.

On the other hand, the price of oil (poo for short) has turned nasty, with analysts like at Goldman Sachs, and hedge fund managers like Boone Pickens, calling for $150 oil. Maybe they are short the airlines, and want to see them all bankrupt. Maybe those people have private jets and don’t care. Maybe they are long Million Air and ready to do an IPO?

Life is strange sometimes when common sense doesn’t register.

Further to this point, just because commodity prices rallied on Friday, there are clear indications that prices for oil, metals and precious metals are headed south. Soon, the 200-day Moving Average lines, which are presently areas of technical support will become battlegrounds as the commodity Bulls will put up a fight. My point in the past several weeks is that the Bulls will lose this fight, but eventually win the war.

By the end of this year I do think we’ll see higher oil and precious metal prices, based on supply and processing cost issues, but in the interim I also expect a major Buy opportunity to pop up.

Btw, in my referring to gold bugs, there are two types: one is the persistent proselytizer and the other is the gold-focused trader.

I happen to be a little bit of the former because I do agree with the GATA position that (i) there is a conspiracy against transparency and honesty in the gold market and (ii) fiat money value is constantly deteriorating due to seemingly unstoppable fiscal deficits and monetary growth.

Regarding, the latter, you know I am somewhat gold-focused because the subject is so interesting and involved with macro- and micro-economics, politics, the excitement of discovery, and the allure of the metal, that traders love to trade it, which brings liquidity. Traders need liquidity.

The same thing applies, I suppose, to oil, but frankly I have never seen the allure to oil. I look at oil strictly as a consumable rather than the investible product that gold is.

The key point is that, as a trader, I don’t get caught up in the constant selling of gold as a concept. I got the point some 30 or 40 years ago. I find the selling process abusive and just more random noise we traders need to avoid.

I hate it that whenever there is a small trend up in the price of gold the gold-bugs trot out their band-wagon pulled by a one-trick pony. Seeing this for so many years, I can say that the picture is so old I’m surprised some traders get fooled by it.

---

Global Economics Review

The macro-economic data continues to worsen, both in America and abroad.

Here are the key US economic reports and the Econoday analysis from last week.

US Economic Calendar.

According to Econoday, “The Conference Board's consumer confidence report for May, without exaggeration, is dismal. The main index fell nearly -5 points to 57.2, the lowest reading since 1992. But more importantly, 12-month inflation expectations swelled to 7.7%, up +9/10’s from May and confirming a similar spike seen in the mid-month Reuters/University of Michigan report. Views on the labor market continue to deteriorate, with those saying jobs are currently plentiful falling 8/10’s to 16.3% while those saying they are hard to get rising +1/10 to 28.0%.”

Re US New Home Sales for April, Econoday reports that “the current annual rate of 526,000, next only to March's 509,000, is the lowest since the early 90s with the year-on-year percentage decline of 42.0 percent the worst since the early 80s.”

US Durable Goods Orders data for April. Durable goods orders in April slipped a further -0.5%, following a -0.3% decline in March. However, the spin is that April's figure was pretty good considering the consensus had been for a -1.1% decrease. The point is that the manufacturing industry is worsening in America.

US Personal Income and Spending data for April. Econoday reports that “personal income in April slowed to a +0.2% increase, following a +0.4% advance in March. April's gain equaled the consensus forecast for a +0.2% rise. But the average worker appears to be bearing the brunt of the economic slowdown as the wages and salaries component actually fell -0.2%, following a +0.5% boost the month before. The strength in personal income was gains in rental income and especially a jump in government benefits. The surge in benefits reflected the start of the income tax rebates intended to boost the economy.” I think that the slowdown in US personal income is the key. I expect that to lead to demands for higher wages.

So much for last week, it was another bad one although retail sales started to pick up.

Let’s look ahead. Here is next week’s economic calendar, which is shaping up to be a not-so-quiet post-Memorial Day week:

US Economic Calendar.

ISM Manufacturing data for May. The Institute for Supply Management's manufacturing index is still pointing toward contraction in the manufacturing sector, although not by much. Emphasis will be placed on the order backlog.

US Factory Orders data for April. March orders were higher than expected, and if April proves the same, there will be some economists who will be opining that the US is not, nor will be, in recession.

ISM non-manufacturing survey data for May. The April data was borderline recessionary, and also a tad better than expected. Let’s see what information the latest data brings.

US Jobs Report for May. The April report was a loss of -20,000 jobs, but the spin was that it was a good report because a loss of -70,000 was anticipated. The point is that a healthy US economy needs a monthly gain of about +180,000 jobs, and jobs are disappearing except lower paid jobs related to the so-called tax rebates, which leads to spending and the need for service workers.

On Thursday, both the Bank of England (BOE) and European Central Bank (ECB) report their decision on monetary policy. My thinking is that there will be no further rate cuts this year on account of the inflationary pressures that policy generates.

The inflation and other macro-economic issues that Americans are struggling with are global in scope. High inflation rates will likely result in very few central bank rate cuts in the next couple years. If the global economy suffers further contraction, the monetary authorities can do very little at this point.

Weekly International Economic Report . Econoday reported:

(Last week’s) data ran the gamut of the usual month-end Japanese numbers including consumer inflation and spending along with industrial production to the spate of European data including disappointing confidence surveys and uncomfortably high consumer and producer price data. German data also disappointed including a decline in German retail sales for a second month and an increase in the number of unemployed… Seemingly, the data deluge was overridden by easing commodity prices which sent equity investors to stocks previously shunned such as airlines and autos.

Government bonds sank to multi-month lows despite declining commodity prices. Lower prices failed to dispel investors’ concerns about mounting inflationary pressures. The yield on the 10-year U.S. Treasury bond briefly touched 4.14%, the highest since December, before easing back while the 10-year German bund yield climbed to 4.44% after having hit a 10-month high during the week. And in Japan, the 10-year Japanese government bond yield settled at a 10-month high of 1.8% before receding.

Commodity prices staged a significant retreat —oil prices fell about $5 in volatile trade on Thursday while gold hit a two-week low of $870 an ounce and copper fell below $8,000 a ton for the first time in two months. And in currencies, the U.S. dollar was up against both the euro and yen. The yen sank to a three-month low against the dollar as risk appetite improved once again.

Global traders are skeptical at this point that falling commodity prices can develop a sustainable trend to the downside. But maybe the Energy sector ETF (XLE) losing -2.0% this week, and -3.0% a week ago, is the start of traders believing that oil prices might be heading south.

In closing, I think this weekly report by Econoday is a succinct review of international markets, and a good use of your time to read.

---

US Equity Markets Review

DJIA ino.com chart

DJIA stockcharts.com chart

This week was somewhat mixed to bullish as 7 of 10 sectors lifted, but only 13 of 30 Dow components were up on the week. The DJIA index was up +1.3% W/W, but is still down -4.7% YTD.

The S&P 500 and NASDAQ Composite gained +1.8% and +3.2% W/W, but are down YTD by -4.6% and -4.9%.

This week Technology and Telecom were leaders. Energy stocks were losers.

---

NASDAQ Composite ino.com chart

NASDAQ Composite stockcharts.com chart

Tech, including Semi-conductors, were gainers on the week.

Here is the list of the ten highest-weighted non-financial stocks in the Nasdaq Composite. Put them in a watchlist (see Google Finance Portfolio) and watch them like a hawk. If you want, add a couple like SNDK and ADBE:
AAPL MSFT GOOG QCOM RIMM CSCO INTC ORCL GILD EBAY

Daily RSI-7 for the Nasdaq 100 Big-10

Weekly RSI-7 for the Nasdaq 100 Big-10

Monthly RSI-7 for the Nasdaq 100 Big-10

---

The US equity market Sector ETF Summary

This week, there were 3 sectors down and 7 up. On Friday the scoreboard read: 4 sectors down and 6 up.

Here’s the SPY Monthly, Weekly and Daily data charts:

SPY Monthly data:

SPY Weekly data:

SPY Daily data:

The tables I now show are for eleven GICS Sector Index Funds (ETF’s), including two for Technology (XLK and SMH), for a total of ten GICS sectors. They cover the full spectrum of the US equity market.

Table 1: Cara ETF List is sorted by price performance Week over Week (W/W), i.e. 1W%N.

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
XLK	25.35	0.10	0.40%	3.34%	-0.31%	2.14%	-2.95%	13.42%	-3.47%	-0.71%
IYZ	26.89	0.02	0.07%	2.32%	0.45%	2.44%	-7.82%	13.80%	-8.07%	-22.06%
XLI	38.84	0.20	0.52%	1.38%	-1.37%	0.23%	0.86%	6.64%	-1.42%	-0.21%
IYH	64.71	0.22	0.34%	1.17%	1.65%	0.42%	-7.69%	-1.45%	-11.03%	-10.30%
SMH	32.65	-0.02	-0.06%	1.08%	-1.51%	3.22%	4.11%	14.36%	1.02%	-9.73%
XLP	28.49	0.07	0.25%	0.96%	-0.04%	1.21%	0.35%	4.94%	-2.40%	2.52%
SPY	140.35	0.35	0.25%	0.60%	-1.53%	-0.54%	-3.16%	4.93%	-5.58%	-8.55%
XLY	32.31	-0.19	-0.58%	0.19%	-4.04%	-2.86%	0.34%	3.69%	-6.81%	-19.20%
XLB	44.51	0.31	0.70%	0.07%	-1.85%	5.95%	7.77%	8.61%	6.53%	9.36%
XLU	41.31	-0.17	-0.41%	-0.74%	2.05%	2.03%	-1.85%	9.49%	-3.32%	-0.94%
XLF	24.76	-0.26	-1.04%	-1.12%	-6.57%	-10.16%	-12.69%	-4.33%	-20.26%	-34.84%
XLE	86.00	0.88	1.03%	-1.99%	0.21%	7.55%	8.18%	13.08%	17.17%	25.27%

You can do this table yourself by entering the following string into the Summary window at Billcara2.com and then clicking on the link for Performance. SPY XLE XLB XLI XLY XLP IYH XLF XLK SMH IYZ XLU . You can also add more ETF’s – up to 30 in total.

For a list of components to many ETFs, go to the AMEX.com web site, and click on ETF’s.

---

10 (energy: XLE)

15 (basic materials: XLB)

20 (industrial: XLI)

25 (consumer discretionary: XLY)

30 (consumer staples: XLP)

35 (healthcare: IYH)

40 (financial: XLF)

45 (technology, semiconductor: SMH)

50 (telecom: IYZ)

55 (utilities: XLU)

---

Individual Sector ETF Review

I use XLK for the Tech sector for a total of ten (10) sectors, but also include Semiconductors (SMH) because it is my bellwether on the economy plus use SPY to see where each sector stands relative the broad market.

Sector 10 (energy: XLE, IYE, VDE, OIH, PBW and IXC)

Here’s the XLE Monthly, Weekly and Daily data charts:

XLE Monthly data:

XLE Weekly data:

XLE Daily data:

Table 2: Senior oil & gas equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
PTR	142.55	3.40	2.44%	-0.08%	-1.94%	-6.74%	-17.91%	-2.91%	-25.65%	11.44%
SLB	101.13	0.14	0.14%	-1.31%	-2.24%	2.83%	0.55%	16.98%	8.22%	26.55%
PBR	70.50	-0.28	-0.40%	-2.11%	3.27%	-42.19%	-40.66%	-39.92%	-26.79%	30.34%
TOT	87.26	0.18	0.21%	-2.55%	2.32%	4.97%	4.78%	15.74%	7.83%	15.88%
CVX	99.15	0.29	0.29%	-2.71%	0.67%	4.43%	6.09%	14.41%	12.97%	20.55%
RIG	150.19	-1.89	-1.24%	-3.17%	-3.35%	3.04%	2.91%	6.89%	9.40%	52.59%
IMO	58.05	0.89	1.56%	-3.94%	2.04%	1.56%	5.70%	2.58%	18.40%	23.20%
XOM	88.76	-0.59	-0.66%	-4.05%	-2.78%	-1.05%	-5.08%	2.01%	-0.45%	5.67%
ECA	90.37	0.92	1.03%	-4.18%	-1.57%	16.25%	29.82%	18.58%	38.50%	46.09%
SU	68.35	0.77	1.14%	-4.84%	5.59%	25.74%	23.98%	32.46%	42.75%	57.09%
STO	39.15	1.05	2.76%	-7.29%	-1.81%	9.94%	25.32%	28.19%	21.13%	43.88%
CEO	177.29	1.14	0.65%	-10.55%	-8.47%	-1.47%	5.90%	6.95%	-3.94%	91.91%

Crude Oil ($WTIC -$4.87/bbl -3.66% W/W) lost power, closing at 127.35. I thought that might happen when a week ago I reported, “But, Energy (XLE -3.02% W/W) turned bearish following a solid two weeks as it seems that traders now see that there is a limit to the high oil prices before the economy crashes.” This week, XLE dropped a further -1.99% to close at 86.00.

All stocks on my monitor were negative on the week although PTR was down just -0.08%. CEO dropped -10.6%.

If the economy stays weak, oil prices might drop further here. In time they will have to because critically important industries like the airlines cannot make profits when the price of oil is at 127.35, or anywhere close.

---

Integrated Oil & Gas - Canada

Oil & Gas Exploration & Production -Canada

---

Sector 15 (basic materials: IYM, XLB, IGE and VAW)

Here’s the XLB Monthly, Weekly and Daily data charts:

XLB Monthly data:

XLB Weekly data:

XLB Daily data:

Table 3: Senior metals and steel equities:

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
VCP	33.66	0.11	0.33%	6.12%	1.54%	5.06%	13.33%	6.99%	1.32%	55.69%
PKX	136.65	1.56	1.15%	2.16%	-5.04%	10.60%	-6.70%	1.00%	-13.44%	17.81%
MT	99.33	0.38	0.38%	0.53%	-1.24%	13.39%	30.01%	30.66%	34.56%	69.33%
NUE	74.80	1.90	2.61%	0.42%	-8.15%	1.33%	29.03%	15.84%	26.33%	10.19%
GGB	49.96	0.37	0.75%	0.28%	8.63%	25.91%	74.08%	52.46%	77.73%	121.36%
TS	61.30	0.93	1.54%	0.13%	5.91%	14.15%	38.09%	37.91%	29.93%	27.97%
AA	40.59	0.25	0.62%	-0.51%	-5.03%	16.91%	12.34%	9.29%	11.60%	-1.58%
TCK	49.55	1.63	3.40%	-1.49%	-1.26%	16.18%	36.73%	24.00%	29.68%	19.14%
DOW	40.40	-0.23	-0.57%	-2.93%	-4.94%	0.00%	4.26%	7.19%	-3.67%	-11.11%
RIO	39.78	0.22	0.56%	-4.01%	-5.67%	3.95%	21.61%	14.18%	15.04%	-10.87%
RTP	483.00	-0.25	-0.05%	-8.08%	-11.62%	4.09%	15.08%	6.28%	3.32%	66.47%
BHP	84.34	-1.41	-1.64%	-8.62%	-9.72%	5.42%	19.78%	15.25%	11.22%	62.38%

Basic Materials (XLB +0.07% closing at 44.51) managed a small gain this week. But a week ago, the loss was a significant -4.38%.

The big losers were Rio Tinto base metals (RTP -8.1%), which follows the week prior where the loss was -9.0%. BHP dropped -8.6% this week.

As I opined a week ago, “These stocks had been very strong, so traders will be looking closely at the upcoming trading patterns. Typically, a global economic slow-down is expected to produce a cyclical bear phase in these stocks.”

---

Sector 20 (industrial: IYJ, XLI, VIS, and IYT)

Here’s the XLI Monthly, Weekly and Daily data charts:

XLI Monthly data:

XLI Weekly data:

XLI Daily data:

Table 4: Senior capital goods makers and transportation:

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
FDX	91.71	-0.46	-0.50%	3.24%	0.94%	-7.03%	6.44%	4.06%	-6.87%	-15.72%
UPS	71.02	-0.58	-0.81%	2.41%	-0.48%	-3.48%	2.69%	1.11%	-3.61%	-0.75%
TXT	62.55	0.86	1.39%	1.67%	-2.63%	1.33%	-6.38%	15.47%	-9.41%	16.94%
BA	82.77	0.66	0.80%	1.67%	-3.25%	-3.09%	-4.44%	-0.02%	-10.56%	-17.68%
MMM	77.56	-0.20	-0.26%	1.20%	-0.39%	-0.36%	-6.23%	-1.07%	-6.85%	-11.79%
CAT	82.64	-0.14	-0.17%	0.51%	-1.03%	0.35%	17.00%	14.25%	14.94%	5.30%
HON	59.62	0.29	0.49%	0.42%	-4.50%	-1.73%	-0.47%	3.61%	5.30%	3.27%
GE	30.72	0.08	0.26%	-0.94%	-5.10%	-7.25%	-16.43%	-7.30%	-19.77%	-18.58%
UTX	71.04	0.81	1.15%	-1.11%	-4.37%	-4.64%	-5.54%	0.75%	-4.99%	2.32%
FLR	186.54	4.10	2.25%	-1.16%	-2.66%	23.65%	29.18%	33.96%	26.75%	79.37%
ABB	32.48	-0.05	-0.15%	-1.43%	0.12%	4.64%	13.41%	29.71%	10.55%	52.99%
ERJ	37.52	0.76	2.07%	-1.60%	-10.33%	-13.07%	-16.86%	-15.34%	-13.91%	-22.81%

The Industrials (XLI +1.38% W/W), closing at 38.84, were strong. There was some blue sky seen in the US economic data that was used to jack up the prices of UPS (UPS +2.41%) and Fedex (FDX +3.24%).

---

Sector 25 (consumer discretionary: XLY, IYC and VCR)

Here’s the XLY Monthly, Weekly and Daily data charts:

XLY Monthly data:

XLY Weekly data:

XLY Daily data:

Table 5: Senior consumer discretionary equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
CCL	40.06	1.04	2.67%	5.56%	-0.74%	-3.59%	-8.25%	1.80%	-11.21%	-20.55%
NKE	68.37	-0.02	-0.03%	5.17%	0.51%	0.83%	8.04%	13.57%	4.14%	22.68%
GOL	15.36	-0.06	-0.39%	4.21%	-7.02%	-13.85%	-35.97%	-10.70%	-39.62%	-52.81%
WHR	73.68	-0.66	-0.89%	1.78%	-2.91%	-1.73%	-7.76%	-12.67%	-8.99%	-34.11%
TM	102.05	2.84	2.86%	1.56%	-1.99%	-0.99%	-4.14%	-5.99%	-9.25%	-14.99%
BDK	64.70	0.70	1.09%	1.28%	-5.38%	-3.62%	-7.48%	-5.92%	-21.72%	-31.17%
BBBY	31.86	-0.21	-0.65%	1.27%	-7.89%	-5.38%	12.34%	12.42%	1.30%	-22.41%
TGT	53.36	-0.39	-0.73%	0.66%	-3.16%	-1.62%	7.78%	1.43%	-11.02%	-12.64%
DIS	33.60	-0.21	-0.62%	-0.03%	-3.97%	0.90%	5.53%	3.67%	1.36%	-6.43%
JCP	40.24	-1.27	-3.06%	-0.67%	-13.13%	-8.42%	-3.39%	-12.92%	-8.79%	-50.06%
EBAY	30.01	0.20	0.67%	-1.77%	-6.01%	-5.57%	-7.63%	13.85%	-10.50%	-9.66%
BC	13.70	-0.45	-3.18%	-8.91%	-18.26%	-19.17%	-19.03%	-15.90%	-32.81%	-60.37%

Consumer Cyclicals (XLY +0.19% closing at 32.31) held ground but failed to make up for the prior week where the loss was -5.20% W/W, and the loss on Friday alone was -1.71%.

The leader-board had the Fun Ships, Carnival Cruise Line (CCL) up +5.6% based on the falling oil price. If Oil continues to fall, look to these shares to have more days like Tues, Thurs and Friday this week.

The Cara 100 loser continues to be Brunswick (BC -8.91% W/W), which is now down -18.3% over 2 weeks. Friday’s loss alone was -3.2%. I think it will take oil prices to fall well under $100/bbl before customers return to Brunswick’s pleasure boats (Sea Ray) and marine engines businesses.

This stock was almost $17 two weeks ago and is now just $13.70. The M-W-D is just 13.90/28.30/11.97 and has been in the Accumulation Zone for two days. Alternatively, on further weakness early this week, I would consider writing a short put, say the Sep-12.50’s at +0.95, taking my cost basis to 11.55 if the stock is put to me this summer. If I could get $0.25 for the 10’s, I’d take that too.

And if, as and when a Buy Alert is set off as the Daily RSI-7 hits 30 and rising, then I might be persuaded to also buy the stock, although I know this is a Bear market, so I am reluctant to take long equity positions over and above long-biased options positions.

The RBC analyst seems to agree with me about Brunswick’s prospects and the fact there is value here. The stock was at $49.50 at Dec-2004 (and may take some time returning to that level), but traders should be looking to buy stocks of quality companies at a discount to value. The trailing 12m P/E is about 15.4 and the Forward PE is just 12.5. The dividend yield is about 4.20% (trailing and forward) and is likely to be sustained as insiders own over 10% of the stock. I like that. I also like the fact that the short position is 22% of the float. I find it hard to believe this buying power would remain on the sidelines if they see oil prices starting to fall again this week like last.

So, if I can position myself to buy the stock with a potential 12-month gain of say 70% to 100%, then I’m in. My leveraged options trades will take me there faster.

The point is if you can line up 10 trades like this, I believe at least 8 will be winners. Your Job #1 is to have more winners than losers and to keep the losses smaller percentage wise than the winners. But you need to be patient, and stand by with a plan in hand.

---

Sector 30 (consumer staples: XLP, VDC, RTH and IYK)

Here's the XLP Monthly, Weekly and Daily data charts:

XLP Monthly data:

XLP Weekly data:

XLP Daily data:

Table 6: Senior consumer staples equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
PDA	65.70	1.75	2.74%	11.45%	10.33%	17.74%	36.51%	37.45%	37.62%	84.55%
BUD	57.46	0.91	1.61%	9.28%	10.91%	15.64%	11.29%	22.02%	8.99%	9.07%
SBUX	18.19	-0.14	-0.76%	6.44%	13.19%	9.25%	-5.80%	1.17%	-22.23%	-36.62%
WFMI	29.00	0.01	0.03%	3.57%	-0.41%	-16.62%	-27.06%	-17.50%	-32.57%	-29.46%
WMT	57.74	-0.20	-0.35%	3.02%	1.09%	-0.57%	23.11%	16.43%	20.54%	22.54%
KR	27.64	-0.10	-0.36%	1.58%	2.41%	-0.65%	7.67%	13.98%	-3.86%	-8.05%
WAG	36.02	-0.01	-0.03%	0.95%	-1.48%	0.92%	-3.54%	-1.34%	-1.56%	-20.40%
PG	66.05	0.58	0.89%	0.66%	-0.47%	-1.46%	-8.66%	-0.20%	-10.74%	3.45%
DEO	78.62	-0.06	-0.08%	0.28%	-1.53%	-5.05%	-7.57%	-4.24%	-13.20%	-7.59%
PEP	68.30	-0.53	-0.77%	-0.12%	0.34%	-0.29%	-9.28%	-1.81%	-11.51%	-0.39%
KO	57.26	-0.61	-1.05%	-1.73%	0.44%	-3.10%	-6.27%	-2.05%	-7.79%	7.94%
ABV	68.67	-0.64	-0.92%	-6.79%	-12.76%	-10.88%	-5.26%	-15.72%	-8.54%	2.43%

Consumer Staples (XLP +0.96% W/W) was a bit stronger, closing at 28.49.

Anheuser-Busch, referred to as Budweiser (BUD), up +9.4% a week ago on the hopes that (Cara 100) Brazil’s InBev (ABV) will buy it out, also jumped +9.28% this week. From the trading activity, I think some kind of deal is in the works.

(Cara 100) Brazil’s Perdigao (PDA) soared +11.45% W/W, hitting a record $66.11 on Thursday, closing at 65.70. With a RSI-7 at 80.15/84.10/75.81 for the M-W-D, the stock has been in the Distribution Zone for 3 days. A Sell Alert will be made as the Daily RSI-7 falls below 70. If the Weekly RSI-7 also falls below 70, then I would off the stock.

Perdigao was added to the Cara 100 on Jan-08 this year at $47.42. At Friday’s close of 65.70, that is a 5-month gain of about +38.5%, up near my usual Buffett-type performance (LOL). Actually, when I add or subtract companies to/from the Cara 100 there is zero consideration for the stock price or the technical analysis metrics I use.

Having said that, I’m not interested in holding PDA in the high 60’s, particularly a food processor with a Forward P/E of 34 and almost no dividend. When the M-W-D RSI-7 reaches numbers in the 80’s, I’ll buy my hot dogs somewhere else, thank you.

Now, rather than write a covered call, I would not hesitate to sell the stock. I feel strongly I could buy this one back at under $60 in a year’s time. My objective is to protect capital, not sit with amazement while Chinese traders buy up stocks on the Sao Paulo Bovespa with the capital handed to them by Wal-Mart USA customers.

---

Sector 35 (healthcare: IYH, XLV, VHT, IXJ, and IBB)

Here’s the IYH Monthly, Weekly and Daily data charts:

IYH Monthly data:

IYH Weekly data:

IYH Daily data:

Table 7: Senior healthcare equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
BMY	22.79	0.31	1.38%	3.83%	3.73%	-0.65%	-12.78%	0.80%	-23.08%	-24.34%
AMGN	44.03	0.61	1.40%	2.95%	4.71%	1.85%	-5.52%	-3.27%	-20.31%	-20.32%
DNA	70.87	-0.14	-0.20%	2.87%	2.96%	3.69%	5.15%	-6.44%	-7.06%	-9.99%
JNJ	66.74	0.32	0.48%	2.03%	0.09%	-1.58%	1.26%	7.71%	-1.48%	5.57%
AET	47.16	0.65	1.40%	1.14%	10.16%	9.27%