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Buzz Bits: Dow Dips, Nasdaq Creeps Higher


Your daily Buzz highlights...


Editor's Note: This is a small sample of the content available on the Buzz and Banter.

Buzz in the Afternoon - Todd Harrison - 3:07 PM

  • Overcapacity is one thing. Contagian is another. While one doesn't lead to the other, they're not mutually exclusive either. And yes, we're often early.

  • Tale of today's tape? Energy (OSX +3.5%) and Metals (XAU +1.6%) vs. everything else. And the breadth, for those watching at home, has been nondescript since the Raiders failed to score a touchdown for the eighth stright quarter.

  • I'm watching the homies trade like banshees but I'm not currently involved. I will offer, however, that while the NAHB coincided with some supply in the sector, the stocks, as we so often discuss, are leading indictors of the headlines.

  • Enjoy the easy breeze, Minyans, it likely won't last.

  • The ability not to trade is as important as trading ability. That's particularly apropos on days like today and I, for one, have followed that script today.

  • As always, I hope this finds you well.


Position in energy and metals

Finance without romance is a nuissance? - Kevin Depew - 12:07 AM
  • Keeping an eye on the financials. The BKX is registering a DeMark sell signal today on the daily chart. Prior daily sell signals, in April and last November, produced only brief pauses in the overall uptrend.
  • But those were not accompanied by an active DeMark TD-Sequential sell signal on the monthly chart and the potential for a TD-Sequential sell signal this week on the weekly chart.
  • Also note the XBD off by half percent this morning.
  • General Dynamics (GD). They make combat stuff. Just what we need in this crazy world, right? Perhaps it's already priced in. The stock just registered TD-Sequential sell signals on the daily and weekly charts.
  • On the buy side, Ballard Power (BLDP) registered a TD-Sequential buy signal last Friday.
  • "Why would I sell my house for less and buy one for more?''

Gentlemen prefer Gold? - Woody Dorsey - 11:40 AM

Used to be that "Gentlemen preferred Bonds." That was the safe place to be, but maybe gold is the long run? Given the "golden yard sale," is this break a buying gift? Bonds are failing, as expected, which may signal that the old inflation genie has got gold dust all over it. That Papal smear on Islam can't be bearish...for hard assets. Stocks remain neither fish nor fowl, as expected. In fact they are just flesh...that is, eating the flesh of the shorts. That will change...

Hey, Got Monopoly? Check out the prices in the new game. Why, it's just another piece of the "Repricing of the planet." Freud might call it a Freudian slip but the lingerie tell is to be long stuff.

Hey, Got Gas? The natural kind of course. I do and I am really warming up to it. Capitulations don't occur that often.

Planetary misalignment. - Rod David - 10:20 AM

The S&Ps rally last week was no doubt aided by the fundamentals of a seemingly well-entrenched Crude Oil decline. But the technicals of a near-term oversold condition, combined with Monday's "Gotcha!" setup, played right into the mechanics of Friday's expiration session. Everything was properly aligned for delivering maximum pain to shorts.

That was then. This is now.

Crude Oil's timing continues to be appropriate for a bottom. Gold is making a credible effort at a relatively steep corrective bounce, and Bonds have already started turning down. That all sounds inflationary. Even if it isn't (and at this point, it probably isn't, not with the Dollar trying to confirm last week's breakout), the perception might be self-fulfilling.

As for S&Ps, last week's high retested May's high - actually, the lower-end of the consolidation at May's high. Unless or until last week's rally were corrected, a gap up to new highs would be the minimum requirement for signaling that a new rally leg was underway.

Hedgers re-up the ante on the dark side of 10's - Bennet Sedacca - 9:13 AM

See the chart here that depicts the yield of 10's versus the net position of hedgers. They are back to being short an enormous 400,000 10-year contracts or so. To me, this is a monster number in both absolute terms and in relative terms.

What do they see? Well, my firm sees huge resistance in the 107-16 to 107-24 area in 10's that has existed all year - see the chart here. I remain on the cautious side unless and until that level is breached on a closing basis. That might cement the next piece of the deflation puzzle that the CRB and commodities are saying.

What about their position in long bonds that they took when yields were at the highs? (Yes, that is why they are called smart money.) As rates fell and prices rose, they sold. See that chart here. Not a surprise....

Position in Treasuries

Levels - Laurie McGuirk - 8:22 AM

G'day all.

  • Speculation on more consolidation in the South African gold industry. Hmmm. I don't like it at all. Here's an interesting article.
  • Precious metals are not just simple commodities. Articles here and here.

I think gold at this 570-80 level has been severely tested to the downside and I'm almost surprised that those levels have held so well. London Fixes suggest good buying at 575-580. Next couple of weeks could be telling. My tech mate, who I referred to in the August 21 Buzz, reckons we get 540. I'm thinking the physical market will hold above 565 level but let's see what ECB banks do in the next fortnight. Did I see Silver at 10.60 late last week? Wow.

Surprisingly inexpensive, given the state of the physical market, IMO. Owning silver at $10 and change is a very low risk entry area, opinion only.

Position in gold, silver

What you need to know... - Jon Doctor J Najarian - 8:06 AM

General Motors (GM) / Ford (F) Merger? According to published reports, General Motors and Ford have discussed a merger or alliance, industry newspaper Automotive News reports today! AN stresses that the two companies are not holding talks, and one source says there is a slim chance that anything will come of the situation.

Freescale (FSL) Takes $17.6 Billion From Blackstone – This could be the largest leveraged buyout ever in the technology space but since shares have run already, this is neither a surprise nor will it be responsible for a big jump in share price.

JPM Upgrades Getty Images (GYI) – This morning the investment bank added GYI to its focus list, citing compelling valuation. The broker told clients that new pricing models, heavy share repurchases, foreign exchange tailwinds and still exceptionally strong growth in international Royalty Free Imagery should allow Getty to deliver solid growth.

Yahoo (YHOO) Hitting TV & Radio With Ads – Accroding to reports, we can expect an advertising blitz to begin Thursday and it will be YHOO's biggest marketing push in two years.

Positions in YHOO & GYI

No positions in stocks mentioned.

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