Blog description

My photo
A place for friends to gather and view stock market charts, discuss technical analysis and market outlook. What is your Principal Asset? How can it be developed? Each and all should do their own due dilligence and homework before investing. And by no means should you use anything I say or show here as a sole basis to buy or sell securities as everything is for educational experience only.

Saturday, August 23, 2008

Existing home sales

With existing home sales numbers coming out Monday I decided to take a look at the recent data to see if there was anything interesting. So from July 07 to July 08 existing housing monthly supply has risen from 9.1 months to 11.1 months.

Check out the "Months Supply Divided by two" in relation to the actual/consensus numbers. What you see is by dividing the month supply number we can visually see the affect the sales numbers is having on supply. This may be fun to watch as the collapse continues....

Friday, August 22, 2008

Long term look at $INDU

From the Great Depressinon to the 1998-2002 technology nose dive the $INDU or DOW 30 has kept on truckin...
It's just amazing how Fibonacci lines match up on these charts.
How does a 10 year cup with a handle sound? How else are you going to get to DOW 19,000 by 2015? Of course we may see DOW 10,000 again before heading there because 11,750-7,200 = 4,550 and 14,200+4,550 = 18,750. What's a measley 250 points mean to Bull-headed numbers?
What does all this mean for the short term? I have no clue. But the bottom-line is I'll definitely be shopping long leaps when the "Liquidity Crisis" finally finds a bottom.

Thursday, August 21, 2008


Oil is up...big surprise.....Question is for how long? The XLE is tracing out an impressive H&S pattern back to the 50 day EMA. Will it round off or continue higher? Ask the Russians....

Wednesday, August 20, 2008


The financials and or the XLF is all the hubabaloo with rumours looming of a "huge" bank failure and continued liquidity issues down on the governmental farm of Freddy and Fannie. The chart is shaping up pretty bearish. Look out below when the resistance line of $19.75 is finally confirmed broken by the passing of the $19.61 fib line.
Check out GW...... getting long with a stop at $7.95....
The Jan 09 $10 strike is trading for a mere $0.35

Jobless claims estimate for pre-open tomorrow is 448,000. A higher surprise or revision of last weeks number could be the catalyst for the market to fall apart. But natural gas may have bottomed.

Oil inventories = Bad for Stocks

  • 10:36 a.m. U.S. gasoline supply down 6.2 mln brls
  • 10:36 a.m. U.S. distillate supply up 500,000 brls
  • 10:36 a.m. U.S. crude supply up 9.4 mln brls last week

Well talk about an outlier on the high side......

Where do we go from here analysis:

HUGE draw can only mean:

  1. NO demand or activity thus no growth = BAD for stocks
  2. Huge glut will mean OPEC production cut and thus HIGHER prices = BAD for stocks
  3. Gasoline supplies actually down meaning HIGHER gas prices screwing the consumer =

Bad for stocks

MO and CALM update

MO is shaping up nicely for some call leaps.
CALM the egg producer is being rumoured on a buyout, but here again is a lesson in fibonacci levels....... Check out the nice cup with a handle at the 100% line down to the 78.6% retracement for the handle and then BOOM explosion up to the 161.8% line. WOW.

Tuesday, August 19, 2008

The story tomorrow is oil inventories @ 10:35 EST.....

As gleaned from MarketWatch:
"The U.S. Energy Department's Energy Information Administration will report its data Wednesday morning on petroleum supplies for the week ended Aug. 15.
The report will likely show that crude supplies fell by 1.1 million barrels, motor gasoline inventories fell by 3.6 million barrels and distillate supplies were down 900,000 barrels, according to estimates provided by John Kilduff, an analyst at MF Global.

On average, industry analysts surveyed by Platts expect to see crude supplies up by 1.7 million barrels, motor gasoline supplies down by 3 million barrels and distillate inventories up by 1.2 million barrels."
Ok one dude says down 1.1 million and the rest of the analysts AVERAGE UP 1.7 million.... would appear the analysts as a whole have no freakin clue. Let's assume the article writer picked the outlier on the bottom-side as stated above, 1.1 million down. If the average of all is 1.7 million up... Can one reasonably estimate the outlier on the top-side would be an inventory build of 4.5 million? Talk about slow growth....
Either way the market is going to chew on this oil inventory number pretty hard as technical levels are ripe for reversals. Will definitely be telling by days end.....

Monday, August 18, 2008

LOW earnings beats expectations????

I guess expectations of being unemployed and homeless are easy to beat. The literally cool thing is the majority of their sales came from seasonal and freezers. Is the consumer spending money to save money by dining at home? Time to sell restaurant stocks...

Lowe's earnings:
  • EPS declined 4.5% to $0.64 vs $0.67 in 2nd quarter
  • Earnings vs. same period last year down 7.9%
  • Same store sales 2nd quarter down 5.3% versus same quarter 2007
  • Same store sales first half 2008 declined 6.7%
  • 6 months ended 8/1/08 net earnings declined 12.1% to $1.54 billion
  • Third quarter sales growth at 1% to 2%
  • Third quarter EPS of 27 cent to 31 cents
  • Full year of 2008 Lowe's expects earnings per share of $1.48 to $1.55

    "The challenging sales environment we have been experiencing for the pastsix quarters continued into the first quarter of 2008, and increasingfinancial pressures on consumers resulted in top-line sales that fell belowour plan," commented Robert A. Niblock, Lowe's chairman and CEO. "Thegenerally poor economic outlook, including well-known housing pressures,rising food and fuel prices and a more negative employment picture erodedconsumer confidence and impacted discretionary purchases for the home. "With our offering of great products and exceptional service, Lowe'scontinued to gain market share in the quarter, and diligent expense controlhelped us achieve respectable earnings in spite of the headwinds facing theindustry," Niblock continued. "Fiscal 2008 will be a challenging year on manyfronts, but we remain focused on what we can control and will continuemanaging for long-term success and pursuing opportunities as they arise in thecurrent environment." During the quarter, Lowe's opened 20 new stores. As of May 2, 2008,Lowe's operated 1,554 stores in the United States and Canada representing176.4 million square feet of retail selling space, an 11.1 percent increaseover last year.

"Our sales results for the quarter, while better than our forecast, reflect the realities of the continuing macro economic pressures on our industry," commented Robert A. Niblock, Lowe's chairman and CEO. "We saw relative strength in our seasonal sales as homeowners welcomed back spring and restored lawns and outdoor landscaping following the effects of last year's drought in much of the country. In addition, we believe our second quarter sales benefited from the economic impact of the fiscal stimulus tax rebates. Unfortunately, weakness in bigger ticket projects continues, particularly in markets most impacted by the housing downturn.

"Through disciplined expense controls we delivered solid earnings for the quarter," Niblock added. "We are encouraged by our results and our continued market share gains, but the macro economic factors pressuring consumers and the ongoing challenges and uncertainty of the financial markets suggest a cautious sales forecast for the balance of fiscal 2008 is prudent. We remain focused on positioning the company for long-term success while managing through the near-term challenges of the current environment."

During the quarter, Lowe's opened 23 new stores. As of August 1, 2008, Lowe's operated 1,577 stores in the United States and Canada representing 178.6 million square feet of retail selling space, a 10.5 percent increase over last year.

Lowe's Business Outlook Third Quarter 2008 (comparisons to third quarter 2007) -- The company expects to open approximately 38 new stores reflecting square footage growth of approximately 10 percent

-- Total sales are expected to increase 1 to 2 percent

-- The company expects comparable store sales to decline 5 to 7 percent

-- Earnings before interest and taxes as a percentage of sales (operating margin) is expected to decline approximately 290 basis points driven by the cycling of last year's $112 million reduction in self-insurance reserves for workers compensation and general liability claims in addition to payroll, fixed cost and depreciation deleverage

-- Store opening costs are expected to be approximately $34 million -- Diluted earnings per share of $0.27 to $0.31 are expected

-- Lowe's third quarter ends on October 31, 2008 with operating results to be publicly released on Monday, November 17, 2008 Fiscal Year 2008 (comparisons to fiscal year 2007)

-- The company expects to open approximately 120 stores in 2008 reflecting total square footage growth of 7 to 8 percent -- Total sales are expected to increase approximately 1 percent

-- The company expects comparable store sales to decline 6 to 7 percent -- Earnings before interest and taxes as a percentage of sales (operating margin) is expected to decline approximately 180 basis points -- Store opening costs are expected to be approximately $97 million -- Diluted earnings per share of $1.48 to $1.56 are expected for the fiscal year ending January 30, 2009