Buzz Bits: Dow, Nasdaq Slip
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Bell Buzz - Todd Harrison - 3:49 PM
- Note the stealth smackage in the semis (SOX -2%). Texas Instruments is the obvious culprit but you can make the case that the reaction to Intel (upping their guidance) is more disturbing.
- Energy is getting alotta "play" (note HAL and NBR, both up a deuce) and beta (BIDU, AAPL, UA, RIMM) has been bid all day but overall breadth is sluggish (3:2 negative) as we limp off a quiet, nondescript Hump Day fray.
- While I don't understand how Citi knows that their loan loss reserves are declining (are they assuming that there are no unforeseen defaults?), the reaction to the earlier headline is much adieu about nothing, honey.
- Seriously--how do they know where they're going?
- I've been furiously pounding my keyboard, scribing vibe on the dollar and tossing some Mailbags in the till. I am, as you know, out tomorrow through Tuesday (FOMC who?) so apologies in advance and appreciation on the understanding.
- Now, if you'll excuse me, we've got a quickie staff meeting (as we vote on the semi-annual employee of the year) before I flip lids, grab a shower, find a suit and circle up with the fam. Fare ye well into the bell and for everyone observing the holiday, a very sweet year.
- May peace be with you.
Tech Trades - Sean Udall - 3:36 PM
Adding to some of my bandwidth plays today on weakness: Level 3 Communications (LVLT) and Tellabs (TLAB) plus a software kicker.
Level 3 Communications has gotten killed since it reported its last quarter. I've liked to make purchases of this stock on 20-25% pullbacks and with recent weakness we have had such a pullback. Time permitting I'll post my fundie thesis but there is a lot of good coverage of this name so I'm mainly concerned with executing good entries on purchases.
Tellabs is a more interesting long in that I think there are many ways to win here. Most importantly I think we have seen a near term bottom in its business trends. Its last quarter was fine and the stock responded well. Since then merger rumors have swirled and evaporated, thus causing any momentum to also evaporate. I think the balance sheet strength and improving business trends more than justify a purchase at current levels. Plus, I wouldn't be surprised if Tellabs got acquired.
Avid Technology (AVID) is another company that reported a muted quarter but stock price has reacted like it reported a train wreck. Avid Technology is a maker of software and systems for digital media and I want to have exposure to these areas of technology.
Positions in LVLT, TLAB and AVID.
Metalheads... - Sally Limantour - 11:40 AM
Gold has had an impressive run, tacking on $67 per ounce in three weeks. and the Gold bulls are salivating at the prospect of a breakout to $800 per ounce.
The silver market has been lagging lately and while gold is up 10.3%, low to high for the current rally silver is up 15%, even though it seems to have been moving slower.
The new silver ETF (SLV) will be a year old in April. It has already removed roughly 145 million ounces of silver ($1.83 billion) from a market that used just 912 million ounces in 2006. The new silver ETF all by itself is now responsible for almost 16% of usage.
Remeber silver is also an industrial metal and because most of silver is used industrially, much of it gets "used up" in the process. Unlike gold, there are no massive quantities of silver in central banks available to help supply a short market.
I continue to like silver on breaks and am adding to Pan American Silver (PAAS) and Silver Standard Resources (SSRI).
Positions in silver, PAAS and SSRI.
Possible S&P 500 Set-ups - Cody Tafel - 9:40 AM
I am watching for two potential setups here in the S&P 500. First, it looks like this bounce from the August lows could be stalling out here with the formation of a head and shoulders with the neckline at 1440. (Note how this neckline also coincides with a Prof. Cooper level). A break below this neckline could set us up for a quick test of the August lows.
However, there is also a potentially bullish setup which would see the S&P 500 retake the 50 day moving average at 1484 and then possible upside range expansion on a close above 1500. While this could be a decent set-up for a quick long trade, I would have to agree with Prof. Cooper's comments this morning that such a move could lead to a false breakout and suck everyone in as things look great right before the "plug is pulled". Be careful!
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