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For Monday October 8, 2012

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Dow +34.79 at 13615.40, Nasdaq -13.27 at 3136.19, S&P -0.47 at 1460.93


Columbus Day Christopher Columbus was an Italian explorer and navigator and under the auspices of the Catholic Monarchs of Spain, he completed four voyages across the Atlantic Ocean that led to general European awareness of the American continents. Of course the continent was not unknown as a Vikings had made numerous trips 500 years earlier and may have even taken back some native American people. Those voyages by Columbus, and his efforts to establish permanent settlements on the island of Hispaniola, initiated the process of genocide and Spanish colonization, which foreshadowed the general European colonization of what became known as the "New World". During his first voyage in 1492, instead of reaching Japan as he had intended, Columbus landed in the Bahamas archipelago, at a locale he named San Salvador. Not all states honor this day as the actions of Columbus and then the arrival of European settlers lead to the death and or in slavery of a huge number of indigenous peoples of the Americas. Perhaps some day this holiday will be changed and instead of honoring the conqueror, honor instead  those that were conquered and name it "Native American Day."


The first presidential debate is over and unfortunately president Obama seemed to be sleeping through much of it, his head looking down perhaps he was reading tweets or playing Angry Birds. . Meanwhile, Romney was talking about dumping Big Bird by dropping some funding the government give to PBS. That total funding amounts to about six hours worth of funding of the military budget, and that Romney wants to even increase. Everyone knows it is much better to accentuate the positive and try to eliminate the negative. So at least give the military a six hour vacation and keep funding Big Bird. . Hopefully by the next debate President Obama will wake up and challenge his opponent and highlight the accomplishments of the last 3 1/2 years. The market seemed not to care one way or the other about the debates and just continued its move back up from the September lows. That dip may now be out of the way so that we can continue higher into the elections. 


Major indices since President Obama took office.  He never even mentioned it in the debate - just crazy.

Obama's Stock Market


Before we get to the charts - a little entertainement.

It happens  Did you ever hear a song on the radio and think you knew the lyrics and only, maybe a long time later found out that what you thought they were singing was not at all what it was? Well imagine a poor student of lip reading. They watch lips and write down what the person is saying. But heck - mistakes do happen.  Well when Rebecca Black came out with the song Friday in 2011 it generated what is today 81,400 response videos. One of them was an interpretation as it might have sounded like according to a bad lip reader. The original Friday song is here -  original   and the BLR version is here named Gang Fight   That video was so popular that @BadLipReading continued making them and has now done 31 videos and they have 460,000 subscribers with 76 million views. They have done many political videos and lately of course the candidates but this one from earlier this year is a good example of their work. Actually Michele Bachmann at times is so strange and off the wall that parts of this do not sound that much different than what she may be saying.  :) If you want to see the captions click the CC at the bottom right of the panel. "And where I'm from mama get's a what-what, you know I represent." 


With employment in the U.S. showing continued growth in the month of September, the Labor Department released a report showing a notable drop by the unemployment rate for the month. The continued job growth pushed the unemployment rate down to 7.8 percent in September from 8.1 percent in August. The drop surprised economists, who had expected the unemployment rate to come in unchanged. With the unexpected decrease, the unemployment rate fell to its lowest level since hitting a matching rate in January of 2009. charts - RTTNews

The Bureau of Labor Statistics (BLS) reported September non-farm payroll gains of 114K, broadly in-line with expectations, but August's 142K tally (August was revised higher from 96K). The revisions trend was clearly positive - with August and July both revised higher, but with the revisions appear to be mostly in government jobs, which turned from negative to positive.

First-time claims for U.S. unemployment benefits showed a modest increase in the week ended September 29th, according to a report released by the Labor Department on Thursday, with jobless claims still coming in below economist estimates. The report said initial jobless claims edged up to 367,000 from the previous week's revised figure of 363,000. Economists had expected jobless claims to climb to 370,000 from the 359,000 originally reported for the previous week.

The ADP report seems a better and simpler indicator of job growth as it is taken from real payroll data and not a survey. Private sector employment in the U.S. rose by more than expected in the month of September, according to a report released by payroll processor ADP. The report said private sector employment increased by 162,000 jobs in September compared to economist estimates for an increase of about 140,000. At the same time, ADP said the job growth in the previous months was revised lower, with the July growth reduced by 17,000 to an increase of 156,000 jobs and the August growth lowered by 12,000 to an increase of 189,000 jobs.

ISM's Non-Manufacturing Business Activity Index in September registered 59.9 percent, 4.3 percentage points higher than the 55.6 percent registered in August. Thirteen industries reported increased business activity, and three industries reported decreased activity for the month of September. Comments from respondents include: "Steady increase in customer demand for our products" and "New/increased sales booked."

Orders to U.S. factories fell in August from July, mostly because of a sharp drop in volatile aircraft orders. The decline offset an increase in orders that reflect corporate investment plans. The Commerce Department said Thursday that factory orders dropped 5.2 percent in August, the biggest decline in more than three years. The loss was largely because demand for commercial aircraft plunged 102 percent. That pulled down orders for long-lasting manufactured goods by 13.2 percent.


This past week's  and month's sectors.


This past week's indices  - 


The month has started out pretty well with the Dow already up over 1% and the second month over this year's resistance line. The NASDAQ is right at its line as is the Russell 2000, while the S&P 500 is similar to the Dow. Oil in its second candle of pullback after running into the Ctr., Bollinger band resistance while gold is back over its previously broken trendline. 

On the 60 min. chart we see that the pullback at the start of the week did not even make it to the lower Bollinger bands for the Dow or the S&P 500, though it did for the NASDAQ, NASDAQ 100 and the Russell 2000. After the low levels were reached we ran in all cases right up to the top bands or over by Friday. 

The Dow weekly shows the candle reversed the previous week's dip and is sitting now at breakout levels though it's volume this week was less than the 60 week average. 

This Dow chart is two days per bar and we see 175 points above is the 127.2% projection. If it can breakout  there'd be pretty good chances of is running to the Fibonacci overlap projections at 14,200. 

For the Dow futures this is a shorter timeframe projection with a breakout here expect resistance at 13,672. 

The Dow Jones utility average gained this week with a small pullback on Friday. The lower trendline is not extended here but you can see that we're now just about running into it from the underside. 

The transportation average rallied 3% this week but just ran right back into the 50 day EMA resistance. 

The NASDAQ summation index went to a sell at the end of September and has yet to cross back over. 

There was no significant buildup of number of new lows and you see the average number of new highs has not yet gone back over its previously broken trendline. 

On the NASDAQ weekly chart it closed up .64% and is back over this horizontal support level. 

On the 60 min. chart you see the resistance was hit, causing a bit of a pullback which also coincided with a drop in the Williams indicator as RSI a was also near 70. The MACD also crossed over negatively as the histogram went negative as well. 

The NASDAQ 100 futures dipped down to test the breakout level and we have seen a small bounce from there. Previously it had run almost to the 127.2% projection. 

The NASDAQ 100 ETF had gone back to a sell and this week put in one green bar but not enough yet to go to a buy. 

The volatility index closed about where it was last week, still under 15. 

The semiconductor index was pretty flat for the week as it still stuck between its 200 day EMA and the 50 day EMA. 

We did not show this last week but after the McClellan oscillator had gone back over the top Bollinger band in the second half of September the drop took it to the lower Bollinger band which marked the latest low in the market. 

With the NYSE on top, the lower section is the moving average of number of new highs minus new lows and the line it moved slightly back over the green horizontal line which is bullish. 

73% of stocks on the NYSE are now trading over their 50 day moving average. 

The S&P 500 gained the 1.4% this week, reversing the previous week's decline though it did not close at a new high and the volume was a bit below average. 

In this daily view you see the dip held that lower trendline but we have yet to see a MACD crossover and it is still inside this bearish wage. 

On the 60 min. charts, though there were dips under this parallel channel, it closed the week back inside. 

On the 15 min. chart however, if you were a short term trader, you had a indicator sell signal and then shortly afterwards a break of this shorter-term parallel channel for the sell. If you were waiting for some support for a short-term buy, it was reached at the dotted line though  RSI was not quite oversold. This may not hold at the start of the week. 

The mechanical chart for 15 min. short term also went to a sell on Friday and closed way. 

The daily S&P 500 showing the dip never got as low to test the breakout level before the rally and a close back over this. 127.2% could lead eventually to the overlapping Fibonacci levels at 1519. 

In shorter timeframe the S&P 500 futures have a breakout level at 1468 within the first target of 1480. 

This is even a shorter timeframe as the S&P 500 reached that 161.8% projection, which began the Friday pullback. 

On that pullback the ultra short for the S&P 500 had a crossover sell and here we show overhead trendline resistance. There was an RSI crossover at this latest low worth noting. 

The Russell 2000 had dropped below its breakout level and ran back over it on Friday but still was not able to close above it. 

And in this view we see the minor upward movement has been hanging around this trendline so there still is a chance that this is a bear flag. 

This shorter timeframe 60 min. Russell 2000 chart is a bit more bullish as it shows a break above this descending trendline and a test of it on Friday. 

The 3X ETF for the Russell 2000 had broken over the trendline on Friday but reached its high in the first hour and declined the rest of the day. 

The longer-term view of the bank index shows it again back at or just above this multiyear trendline.

The daily bank index chart shows the attempt of the breakout on Friday on a bit higher volume but so far it failed. 

And here a closer view of the same. 

The 30 year treasury bond prices have dipped again. So we are likely to see a retest of this trendline and intersection of horizontal support. If that support and 200 day EMA are broken we could see an accelerated drop. 

While the presidential candidate loves to continually say how bad the economy is the retail sector ETF does not agree as it keeps making highs, this week up 2%. 

After a two-week pullback, the Dow Jones world stock index recovered from last week's drop moving up 1.5% getting closer back up to resistance. 

The FTSE gained 2.25% and is back at the trendline. 

The Canadian venture exchange added less than 1% this week as it sits in a consolidation pattern with more likelihood of an upside resolution. 

The Shanghai stock exchange went up almost 3%, which is good but the index is bearish until it can get back over the small red horizontal line. 

Our commodity ETF closed last week at the 50 week EMA and bounced at bit higher this week, but then closed back down remaining flat for the week 

HAere a 12 year view of crude oil just showing a general overview. 

For the week oil dropped 2% and and is just slightly under the 20 day moving average. It came within 60 cents of the 200 day EMA but there are higher odds that it will test that again. 

Here crude oil futures showing it did hold that minor support, so far. 

Last week we showed that natural gas was not far from testing the top parallel channel trendline and basically doing so this week it had a bit of a pullback from there, though it still closed up over 2 1/2%. 

This natural gas futures chart shows the move over breakout level which so far did not hold and when it eventually goes again, you can see resistance at $3.67. The cross it back under the 70 line on RSI was a short-term profit taking signal. 

On the shorter timeframe we showed these Fibonacci projections  well in advance on the breakout over $3.25 and the price went over the short term projection at 161.8%, which allowed for short-term profit taking. 

On a year-long look of UNG, the standard ETF for natural gas we show some midterm Fibonacci projection levels using the smaller lines on the right with a longer-term retracement levels on the longer lines. 

On the shorter timeframe we have retracement levels of this  on the right with the 38.2% at $21.28. 

Gold was up half a percent this week but this shows the resistance at 1792, which was tested this week and the 1804 level over that,. 

Here is the weekly print with a positive candle,  and it could breakout from here. 

The gold miners ETF in the last three tests have shown the importance of the 20 day moving average in green so that can be used as a stop. 

Our mechanical GDX remains on a buy after our brief whipsaw in late September. 

Silver, like gold in a consolidation pattern just under resistance. 

The silver ETF mechanical chart in its fourth month of being long. 

Copper had dipped two weeks but this week put in a small amount of green. 

Palladium had dropped for two weeks in a row after it's big move up also had a reversal this week adding 4%. 

So far the euro futures have done exactly what is typical. After running into resistance at the 50% retracement level, which came after breaking above a downtrend line, it pullback to test that line from on top. This is one of the most common points to buy and it is very common for at least to test the previous near term high and if that is broken, look to resistance at the Fibonacci level shown. 

The US dollar now in its third month of decline closing under the 50 month EMA. 

Last week we saw the dollar futures in what looked like a bear flag and this week we see it was as it fell out of it. 


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This week's economic calendar for the USA. 

Volatility mean opportunity for futures trading and it is free to try it out.

GGlobal Futures has many platforms available for trading futures and Forex but a very popular one is Global Zen Trader as it is very customizable with  exceled built in  charting that can be used free floating.  We made a short video about it giving a very general overview, and we have links on that page to several other videos about this platform. You can try it for free using live streaming data in order to see if future's trading is right for you..  link here/strong> so give it a watch and try it out.

zen tradeer


FFutures and  Forex trading

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This weekend's transmission of Hearts of Space is named  Anabasis - from outer lands to interior worlds. You have until 3AM EST today to listen for free on their site or check your local PBS radio station for their schedule.  


New additions to our watch list we add new ones each day.   There are too many so pick the ones you like the best and set alerts. We also show the list and current prices and level to watch on our live page each day during market hours so it is very easy to follow,   You can also check progress on our Public Stockcharts pages.

ALGN   Over $39.18 or $39.40

BPOP      Over $18.74

CLSN    Over $6.09

GME     Over $23.15 or $23.50

PAAS     Silver miner Over $22.55

RPRX    Back over $16.37


For your eyes and mind 

Photograph by Mihail Pelenko (Lissuin)

Photograph by Alexander Sisuev




Photograph by Maksim Evdokenmov


That's a full lid for today - have a great week. 

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