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Minyanville's T3 Morning Market Call: Market Waits on Greek Debt Deal


The market could trade sideways until we get a major, definitive headline out of the Greek talks.

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US stock futures point to a higher open on Wall Street Monday despite a lack of resolution in the Greek debt talks. Negotiations hit a wall over the weekend as private creditors said they could not improve their offer, but optimism has returned today. With a light data and earnings calendar today, action will be focused on the headlines in Europe. Euro finance ministers will meet today to determine the terms of Greece's debt restructuring in order to a avoid a disorderly bailout.

Bondholders are expected to take on a loss of as much as 70%, and the deal will also involve swapping short-term debt for longer-term bonds. There are still doubts, though, about whether the latest bailout will be enough to get Greek debt to more under-control levels of 120% of GDP by 2020. March 20 is the firm deadline for Greece to avoid a hard default. The market could trade sideways until we get a major, definitive headline out of the Greek talks.

In corporate news, Research in Motion (RIMM) is 4% higher this morning after the beleaguered company's co-CEOs Jim Balsille and Mike Lazaridis announced they would be resigning. The company's leaders have been much maligned, and many say the move has come too late to save the company. Chief Operating Officer Thorsten Heins will take the reins.

Halliburton (HAL) highlighted a light earnings calendar this morning, slipping more than 1% despite announcing a 50% rise in fourth quarter net income and 37% increase in revenue. Also in the oil service sector, Apache (APA) will be on investors' radars after announcing it would buy Cordillera Energy Partners III LLC for $2.85 billion.

Hong Kong and other Asian markets are closed today for the Lunar New Year holidays.

Technical Take

Markets continue to trend higher in an impressive, methodical way. If there are "four quarters" to a directional move, I'm usually at my best during the first two quarters, then around the middle of the third quarter it gets a bit tougher for me to keep as much risk on. At this point the S&P is following a new "ascending channel" and the trend can't be fought until it changes. We are seeing some stocks beat up after earnings and some divergences each day, but ultimately, the market has given you little reason to fight it.

In the S&P, use 1315 as the tradable pivot, just make sure we don't flash through it, squeeze higher and come back below on a daily close. A 60-minute close above 1315 would open the door to a small cluster at 1318-1322 and then 1325.

The bigger resistance zone really stands at 1331-1347. The 1320-1340 level was my Q1 2012 target, and it almost got met very quickly. The question, now is: Do you raise the target or stick to it? This is when you have to take a very close look at the technical landscape.

Futures were trading most of the night around 1305-1308, which can be seen as first support today. Further, the 10-day moving average is around 1295.

Technology has been leading the way since the macro pivot wedge.

Google (GOOG) had a big miss. This is why I always take risk off into earnings as I am not a "macro investor." I do think the 200-day around $562 will be buyable, but we will cross that bridge when we get there. Right now use Friday's range as the new pivots to trade on a micro level. Gap starts at $591, I will see if we can get a trade around there for cash flow.

Apple (AAPL) stock got hit Friday. I sold most of mine on Thursday and Friday's open. I will revisit tomorrow on my radio around 3:30 p.m. ET. (AMZN) was a nice trade above $184-$185, but it came off a bit Friday. See if it holds above $188-$190.

Netflix (NFLX) -- I sold mine last Thursday around $102 and now it seems like it wants to consolidate. Holding $96-$98 would be good long-term for this stock.

Sandisk (SNDK) is holding up very well. $53.50 is a the momentum pivot.

Mega cap tech was impressive on Friday.

Microsoft (MSFT) was my mega cap surprise for this year, and had a nice run after earnings. Now it could use a rest. It takes a lot of energy to move a dinosaur like that. I talked about this stock finally getting frisky over a week or so ago on Bloomberg, and this could be the start of something bigger for Microsoft. I think this stock can see $32-35 this year.

Cisco Systems (CSCO) didn't run fast but gave us a nice move from the $19-19.05 additional buy price.

Intel (INTC) started slow and then got going Friday. Another stock that gained respect last year and can see $30-plus easy this year, but it needs to consolidate first.

Congrats to all you Giants Fans, you deserve it. They played hard and with class. It's great to walk soft and carry a heavy stick. Let the action on the field do the talking. My Jets should learn a bit of a lesson.

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Scott Redler is long SPY, XLF, OIH, WMT, VXX. Short DIA.
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