Buzz Bits: Dow, Nasdaq Jump
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Between the Ticks - Jeffrey Cooper - 2:24 PM
- As the S&P has carved out a potentially bullish Stein and Handle pattern on its 10 min. chart today.
- And walks its way back to its overhead key 50 dma as it turns its daily swing chart up today.
- Only a move above 1520 based on the hourlies will turn the short term trend back up.
- Is this just an oversold bounce or could this be the start, the start of something good?
- Is Mastercard (MA) really Bidu.com (BIDU) on Prozac today?
- Amazing how a little flash of the green light will give the momentum names license to kill offers.
- First Solar (FSLR) was a classic 1-2-3/ 180 pullback set up last night while Suntech Power (STP) was poised as a Runaway Pullback set up.
- Is Deckers Outdoors (DECK) out of the same postion of the above a failed pullback?
- VMWare (VMW) is noticably lacking jig in this tape.
- Is Las Vegas Sands (LVS) rolling craps for its 200 dma?
- Watch MA on a break back below the 200 breakout point today if it sticks. The stock has a penchant for spiking and reversing---see today's 10 min chart here.
Golden! - Lance Lewis - 1:10 PM
Note that gold is not only rallying in dollars and quickly approaching its all-time high at $850, but the yellow metal also made a new all-time high in euros today as well, proving once again that gold's rally is not just a "weak dollar" phenomenon but rather a reflection of the continued breakdown of the fiat dollar-based monetary system that has been in place since the 1970s.
Click to enlarge
Position in GLD.
Minyan Peter: Accounting for Moral Recourse - Minyanville Staff - 12:27 PM
The financial media seems to be focused this week on Level III accounting. While I too believe there are significant issues around the valuation of Level III securities, I think there is a larger issue looming that is not yet getting attention – Accounting for Moral Recourse.
A month ago, Citigroup (C) reported that it had a lower securitization gain because it put higher quality credit card receivables into its off-balance sheet master trust to bolster that entities' credit quality.
A week ago, Wachovia (WB) reported a $40 million charge as the result of the bank buying out bad asset-backed commercial paper from its money market fund. It chose to do this to prevent the funds NAV from falling to below a dollar ("breaking the buck").
And this morning, Citigroup announced that it had lent $7.6 billion to "off-balance sheet" affiliated SIV's rather than having the SIV's sell securities into a distressed market.
While each of these actions reflects the organizations' desire to "do the right thing", they clearly demonstrate moral recourse to off-balance sheet entities. As the economy and the credit markets continue to deteriorate, I expect that we will see more and more examples of financial institutions supporting "third-party" entities.
At least from my perspective, investors would be wise to significantly broaden their definition of "consolidated balance sheet" when assessing capital ratios.
Position in SKF.
Morning Dew - Todd Harrison - 9:10 AM
- After yesterday's kick-save and a beaut, Bonnie and the Bulls are looking for an old fashioned Turnaround Tuesday. S&P 1500 remains the first level of lore but S&P 1490 is the more valuable turf.
- We discussed yesterday that the more a level is tested, the weaker it becomes. I didn't sense that S&P 1490 was dutifully probed but I won't be as certain the next time we get there.
- You can't blame Boo for constantly checking over his shoulder. However, while I love a good conspiracy theory, yesterday's Snapper likely had more to do with everyone and their sister staring at support. Once the seven-figure sized buyers stepped in, we saw an offer vacuum to the upside.
- The quicker we see a downside probe, the higher the odds for Hoofy today. Obvious tells include the nosty financials (no news may be good news but I foresee a lot more news), beta (psychology), breadth and the dollar, which is GET DOWN, GET DOWN by fitty bips this morning.
- As goes the piggies, so goes the poke? Watch this zone in the BKX, dating back to Y2K. It sorta, hasta hold in here (gulp). If and when it does, BKX 101.50, the former floor, is the new ceiling.
- Festivus. Ja Right. Music fo the people. A yeah...
- Deep breath, Minyans---and chill. By the time you get to where you wanna go, the journey will have already ended.
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