Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
How to Get Rich in the MetaVerse - 20th Jan 21
Should you Buy Payment Disruptor Stocks in 2022? - 20th Jan 21
2022 the Year of Smart devices, Electric Vehicles, and AI Startups - 20th Jan 21
Oil Markets More Animated by Geopolitics, Supply, and Demand - 20th Jan 21
WARNING - AI STOCK MARKET CRASH / BEAR SWITCH TRIGGERED! - 19th Jan 22
Fake It Till You Make It: Will Silver’s Motto Work on Gold? - 19th Jan 22
Crude Oil Smashing Stocks - 19th Jan 22
US Stagflation: The Global Risk of 2022 - 19th Jan 22
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
NVIDIA THE KING OF THE METAVERSE! - 10th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
MATTERPORT (MTTR) - DIGITIZING THE REAL WORLD - METAVERSE INVESTING 2022 - 7th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
METAVERSE - NEW LIFE FOR SONY AGEING GAMING GIANT? - 6th Jan 2022
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Basel III Boosts Bank Stocks...

Stock-Markets / Stock Markets 2010 Sep 14, 2010 - 09:10 AM GMT

By: Mark_McMillan

Stock-Markets

Best Financial Markets Analysis ArticleMarket bulls didn't have to look far for another catalyst as Basel III didn't yield any surprises allowing European bank shares to soar...

Recommendation: Take no action.


Daily Trend Indications:

- Positions indicated as Green are Long positions and those indicated as Red are short positions.

- The State of the Market is used to determine how you should trade. A trending market can ignore support and resistance levels and maintain its direction longer than most traders think it will.

- The BIAS is used to determine how aggressive or defensive you should be with a position. If the BIAS is Bullish but the market is in a Trading state, you might enter a short trade to take advantage of a reversal off of resistance. The BIAS tells you to exit that trade on "weaker" signals than you might otherwise trade on as the market is predisposed to move in the direction of BIAS.

- At Risk is generally neutral represented by "-". When it is "Bullish" or "Bearish" it warns of a potential change in the BIAS.

- The Moving Averages are noted as they are important signposts used by the Chartists community in determining the relative health of the markets.

Current ETF positions are:

Long at DIA $102.80
Long QQQQ at $44.76

Daily Trading Action

The major index ETFs opened higher and mostly moved higher until deciding to take a breather around 11:00am EDT. From there, they lost a little ground until interest returned during the lunch hour and by 2:15pm they once again began to show solid gains which lasted almost into the close with the major indexes posting solid gains for the day. The Dow finished about where it started the day. The S&P-500 and NASDAQ-100 were able to close out higher than there gap up opens with the S&P-500 finally closing back above its 200-Daily Moving Average (DMA). The Semiconductor Index (SOX 327.17 +10.60) soared an impressive three percent and finally moved back above its 20-DMA.. The Russell-2000 (IWM 65.27 +1.55) gained some two and one half percent and broke out above its 200-DMA. The Bank Index (KBE 23.83 +0.66) gained nearly three percent and the Regional Bank Index (KRE 23.07 +0.70) gained a similar amount. Both moved above their 50-DMAs. The 20+ Yr Bonds (TLT 102.83 +0.51) gained one half of one percent bucking the trend and bouncing back above its 50-DMA. NYSE volume increased to a nearly average 922M shares traded. NASDAQ volume increased to average with 1.932B shares traded.

There was a single economic report of interest released:

  • Treasury Budget (Aug) came in at -$90.5B versus an expected -$95.0B

The report was released at 2:00pm EDT and wasn't a market mover.

The most important influence on U.S. equities were two-fold. The most important was that the global banking standard Basel III will be phased in over nine years and strengthens reserve requirements for banks. Since there were no surprises, this allowed European bank shares to soar, with a corresponding move for U.S. bank shares, in particular, U.S. bank shares with exposure to Europe. The second influence was from continued Chinese economic growth with the latest figures showing a thirteen percent growth rate! Apparently, the Chinese miracle hasn't yet come off the rails.

Nine out of ten economic sectors in the S&P-500 posted gains and were led by Financials (+2.3%) and Tech (+2.1%). Consumer Staples (-0.1%) declined as traders continue discarding defensive sectors in favor of taking on higher risk for the potential rewards.

Implied volatility for the S&P-500 (VIX 21.21 -0.78) lost nearly another four percent. Implied volatility for the NASDAQ-100 (VXN 22.32 -0.66) fell three percent.

The yield for the 10-year note rose ten and one half basis points to close at 2.90. The price of the near term futures contract for a barrel of crude oil rose seventy-four cents0 to close at $77.19.

Market internals were positive with advancers leading decliners 7:2 on the NYSE and by nearly 4:1 on the NASDAQ. Up volume led down volume nearly 7:1 on the NYSE and by 9:1 on the NASDAQ. The index put/call ratio fell 0.70 to close at 1.23. The equity put/call ratio fell 0.19 to close at 0.52.

Commentary:

Monday's trading was really about the bullish assault on the 200-DMAs for the S&P-500 and the Russell-2000. Finally, the semiconductor index decided to participate as the short covering rally in semiconductors caused a three percent one-day gain and closed back above its 20-DMA. The bank indexes also posted handy gains and closed above their 50-DMAs. Of note is that long-bonds actually also closed higher on the day so everyone isn't buying into the equities rally.

As suggested after last Friday's session, the (at the time) potential break above the 200-DMAs for all the major indexes and the Russell-2000 could be the catalyst needed for a move into a top. We could finally be setting up for topping action here, but the Russell-2000 appears to be changing gears and moving into an uptrend state. That could indicate that the major indexes are ready to follow and will ignore overbought conditions and continue yet higher to challenge horizontal resistance from recent highs.

Volume did rise a bit as we thought it might. If volume continues to grow this week, we will be more confident that the markets will behave in a predictable manner, which means that they will confuse most participants. This is our favorite type of market to trade. For now, we will remain long until we can deduce whether we will have a minor pause before a more significant run higher or whether we will head immediately into a top (these are the most likely scenarios we see).

We hope you have enjoyed this edition of the McMillan portfolio. You may send comments to mark@stockbarometer.com.

If you are receiving these alerts on a free trial, you have access to all of our previous articles and recommendations by clicking here. If you do not recall your username and/or password, please email us at customersupport@stockbarometer.com.

By Mark McMillan

Important Disclosure
Futures, Options, Mutual Fund, ETF and Equity trading have large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in these markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to buy/sell Futures, Options, Mutual Funds or Equities. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this Web site. The past performance of any trading system or methodology is not necessarily indicative of future results.
Performance results are hypothetical. Hypothetical or simulated performance results have certain inherent limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not actually been executed, the results may have under- or over-compensated for the impact, if any, of certain market factors, such as a lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown.
Investment Research Group and all individuals affiliated with Investment Research Group assume no responsibilities for your trading and investment results.
Investment Research Group (IRG), as a publisher of a financial newsletter of general and regular circulation, cannot tender individual investment advice. Only a registered broker or investment adviser may advise you individually on the suitability and performance of your portfolio or specific investments.
In making any investment decision, you will rely solely on your own review and examination of the fact and records relating to such investments. Past performance of our recommendations is not an indication of future performance. The publisher shall have no liability of whatever nature in respect of any claims, damages, loss, or expense arising out of or in connection with the reliance by you on the contents of our Web site, any promotion, published material, alert, or update.
For a complete understanding of the risks associated with trading, see our Risk Disclosure.

© 2010 Copyright Mark McMillan - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in