Monday, January 5, 2004
Issue Contents:
| 06:16 | Happy New Year! Welcome to 2004. |
| 07:05 | U.S. Economic Calendar Data and earnings highlights. |
| 07:52 | Please Note Newsletter publication schedule. |
| 08:22 | Market Sentiment As the pendulum swings. |
| 08:37 | Daily Swing Trade Today's stock setups. |
| 09:19 | The Swing Trade Our approach, documented. |
| 16:16 | Active Trader Transcript Real time forum log. |
After a short break over the past two weeks, we are back at work.
January is the month of New Year's Resolutions. People across the nation start out on a hopeful note. We vow to lose weight, make more money and stamp out a few vices in addition to achieving world peace. When it comes to the market, perhaps the best resolution is to avoid buying high and selling low (and vice versa), but alas, like dieting, what seems simple is often not easy. Doing the right thing at the right time never is.
We at TrendVue have been working in the background to make 2004 the most productive year ever. Over the next few weeks, you'll see our projects from the past six months pull together as we introduce a trading tool with the publication of an article written by Teresa for the February 2004 issue of Technical Analysis of Stocks and Commodities, the top industry magazine. The Classic Swing Plotter will be available to everyone as a FREE plug-in for eSignal Advanced Charting, TradeStation 2000i and TradeStation 7. This will be followed by the release of advanced analytics in the spring.
On the publications side, we are pleased to introduce Jill Neimark, the writer and popular SI personality, as the new editor of our Knowledge Base. Jill will organize, edit and produce all of our educational materials as ebooks and online articles so that our latest research is always available on a timely basis.
Last, but not least, Teresa and Mike are back coaching traders and investors in our real-time service.
Monday, January 5
Earnings Highlights: N/A
- 10:00AM Construction Spending
- 1:00PM 3-Month Treasury Bill Auction
- 1:00PM 6-Month Treasury Bill Auction
- 4:00PM Motor Vehicle Sales
Tuesday, January 6
Earnings Highlights: N/A
- 7:45AM ICSC-UBS Store Sales
- 8:55AM Redbook
- 10:00AM ISM Non-manufacturing Index
- 10:00AM Factory Orders
- 10:00AM Challenger Job-Cut Report
- 1:00PM 4-Week Treasury Bill Auction
Wednesday, January 7
Earnings Highlights: MON, EXFO, BLUD, MBWM, MTCH, NDC.
- 7:00AM MBA Purchase Applications
- 1:00PM 5-Year Treasury Note Auction
- 3:00PM Treasury STRIPS
- 3:00PM Consumer Credit, FOMC G.19 Statistical Release
- 8:00PM FOMC Governer Donald L. Kohn makes a speech titled The United States and the World Economy at the Federal Reserve Bank of Atlanta Public Policy Dinner in Atlanta, GA.
Thursday, January 8
Earnings Highlights: AA, INDB, WDFC, SHLM, AZZ, BRLI
- 8:30AM Jobless Claims
- 10:00AM Wholesale Trade
- 11:00AM Chain Store Sales
- 1:00PM Kansas City Federal Reserve Bank President Thomas Hoenig to speak about monetary policy and the U.S. economic outlook at the Rotary Club in Topeka, Kansas.
- 1:00PM 10-Year TIPS Auction
- 4:30PM Money Supply
Friday, January 9
Earnings Highlights: N/A
- 8:30AM Employent Situation
After years of working 24/7, Mike and I are going to work during market hours and the hours prior to the open each day instead of doing double shifts that were leading to burnout.
The plan is to use the less active times during the trading day to review our watchlists, which is what we would normally do in "real life", and post to the newsletter as we find items of interest. Shortly, we will implement a table format for the major market indices and hot sectors that is updated once per week, so that subscribers can obtain important information at a glance. The Daily Swing Trade will be posted approximately two hours before the open.
On New Year's Eve, I spied this story on the CNN home page.
This is an excerpt from the December 31, 2003 story:
Global stocks have had their best year since 1999, with more gains expected in 2004 as investors regain confidence about economic growth prospects.
After declines in 2000, 2001 and 2002, the three big markets of the United States, Europe and Japan finished 2003 in the black.
On Wall Street, the Dow Jones industrial average put on 25.3 percent for the year, while the tech-heavy Nasdaq jumped 50 percent as technology issues came back to life.
Chip giant Intel put on 105 percent for the year and General Motors rose 45 percent.
Those gains helped end Wall Street's worst bear market in 60 years as investors finally overcame fears of recession, terrorism and instability. But more volatility is expected in 2004.
"The chance of a nasty shock or event remains with us for a year or so yet," HSBC Asia chief economist Geoffrey Barker told CNN.
The Paris-based Organization for Economic Cooperation and Development predicts the United States will grow 4.2 percent in 2004, while Japan and the Euro area will both register 1.8 percent growth.
This morning, the lead story at Reuters is:
Stocks Set to Rise; Seibel Rallies
NEW YORK (Reuters) - Stocks are poised to rise at Monday's opening bell as investors return in full force from the holidays and funnel money into the market on expectations of another up year for Wall Street.
Investors' hopes are high for a strong earnings season despite some worries that U.S. shares are on the verge of becoming overvalued. Aluminum heavyweight and Dow component Alcoa Inc. marks the start of the quarterly earnings period when it releases its results on Thursday.
"That will be the driving force in the month of January -- just how good the fourth-quarter earnings are," said Larry Wachtel, a market analyst at Wachovia Securities LLC. "The pre-announcement season was so benign that you know the earnings are going to be good."
Software company Siebel Systems Inc. sounded a bright note before the earnings rush. The company said before the open on Monday fourth-quarter revenue and profit would surpass its prior forecast, helped by higher license revenue. Siebel jumped to $15.10 before the open after closing at $13.99.
Equity index futures pointed to a higher open. Standard & Poor's 500 stock index futures for March rose 2.80 points, while Nasdaq futures for the same month were up 7 points. Dow industrial futures rose 35 points.
Chip shares could get a lift during the day after the World Semiconductor Trade Statistics group said global sales of semiconductors powered ahead in November, accelerating for the fourth straight month to grow to $16.1 billion. That marked a 25.7 percent increase compared with a year earlier.
The growth, in line with expectations from most analysts, is up from around 10 percent in June and July, after which sales began to accelerate.
Party like it's 1999, again...
It's amazing, isn't it? From Hell to Heaven, in ten months. Back then, prices were projected to go ever lower. Now prices are projected to go ever higher. It's that old Justin Mamis sentiment cycle in action, going round and round again. Last February, it was aversion. Now, we can make a good argument that we're close to enthusiasm, can't we? They are sure excited!
We will return to publication tomorrow, because volume leaders from today's post-holiday session will be much more indicative. In all probability, most stocks of interest have been in an upswing for some time now, so we would not be jumping in on the buy side on an overnight trade regardless, because there has not been a pullback setup.
In case you missed the December 18 article in the Swing Trading Principles section of the Knowledge Base, please take a look at it again, because I added a big section to it this morning to cover off risk management.
The article has expanded to about fifteen printed pages. Please note that our website does not feature "print this" links or printer icons because Mike has already properly configured the printed version for you. If you are using Internet Explorer, click File > Print Preview command to see what an elegant job he's done!
Real time forum log.
Click on the title above to expand this document.