Facebook – Why I Went Long Again

Two weeks ago, on a day when Facebook (Nasdaq: FB) was dropping by more than $2 to around $74.30 a share, I took a new long position. Warren Buffett is known for advising amateur investors to buy when the blood is on the street, and that’s exactly what I did, but for more reason than the blood alone. There are two other good reasons I see further upside for Facebook in the offing and am still long today, despite the share move to over $78. See the Facebook report here.

DISCLOSURE: Mr. Kaminis is long FB. Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Apple Quells Market Fear of Currency Exposure

Just a day after the SPDR S&P 500 (NYSE: SPY) fell by 1.3% on currency impact fear generated by the reports of Caterpillar (NYSE: CAT) and Microsoft (Nasdaq: MSFT), the stellar report of Apple (Nasdaq: AAPL) and news from Boeing (NYSE: BA) had the SPY up sharply. The market was sent into a tizzy Monday after the currency-dirtied EPS reports of Caterpillar (NYSE: CAT), Microsoft (Nasdaq: MSFT), 3M (NYSE: MMM) and others. Suddenly, what should have been expected given the sharp gains of the dollar this past quarter was shocking the entire market. The Dow Jones Industrials took an even bigger hit than the S&P 500 thanks to the multinational exposure of its components; the SPDR Dow Jones Index (NYSE: DIA) was down 1.65% yesterday. The PowerShares QQQ (Nasdaq: QQQ) was off by 2.6% thanks to Microsoft. Needless to say, given Apple’s influence, it’ll be up significantly today. See the market report here.

DISCLOSURE: Mr. Kaminis is long AAPL. Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Today's Trading - Why the 200-Day Moving Average Matters Near-Term

Friday’s trading will likely be hampered early by relatively weak economic data and more bad news from corporate America, namely Intel (Nasdaq: INTC) and Goldman Sachs (NYSE: GS). However, investors will want to keep their eye on how we close the day and on how well 200-day moving average support holds for forward direction for the rest of this month. Unfortunately, we still have the European Central Bank meeting and the Greek vote to worry about, so that underlying risk aversion should hold through January. That means that what has worked, namely gold as we suggested at the start of the year, should continue to work. What has failed so far, high-beta and momentum stocks and energy, threatens to continue to fail over the near-term. See my report on the market here.

Security	01-16-15	YTD
SPDR S&P 500 (NYSE: SPY)	-0.9%	-3.2%
SPDR Dow Jones (NYSE: DIA)	-0.6%	-2.7%
PowerShares QQQ (Nasdaq: QQQ)	-1.3%	-3.2%
SPDR Gold Shares (NYSE: GLD)	+2.5%	+6.0%
iPath S&P Crude Oil (NYSE: OIL)	-5.1%	-14.2%
PIMCO Total Return (Nasdaq: BOND)	+0.5%	+1.6%
PowerShares DB US $ Bullish (NYSE: UUP)	+0.3%	+1.2%
iPath S&P VIX ST Futures (NYSE: VXX)	+2.9%	+16.6%

This Week – Perception is Reality

Perception could be reality as the month unfolds here. Investors fattened up in 2014 are cautious here in 2015 and weary of risks tied to energy’s too quick decline, dollar damage to multinationals’ overseas income, Russian tensions and the possibility of terrorism here at home. It did not help that well-respected Goldman Sachs said a correction is likely here at the start of the year. Let me be clear, though, there are serious risks to worry about now and I do not expect the VIX to soften anytime soon. You’ll want to lay off multinationals and momentum here to start the year, and continue to work gold. However, I am taking close looks at recently beaten down Greece and energy for important inflection points. I saw it in Greece but did not get it to pen fast enough for you, though there should be further profit opportunity. One of my favorite stock names, Ambarella (Nasdaq: AMBA), took off as well before I could publish on it, but I needed some time off and took it. I’m back now, so please do stay close (WallStreetGreek).

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

Security	YTD	TTM
SPDR S&P 500 (NYSE: SPY)	-0.6%	+13.1%
SPDR Dow Jones (NYSE: DIA)	-0.4%	+10.3%
PowerShares QQQ (Nasdaq: QQQ)	-0.3%	+19.3%
SPDR Gold Shares (NYSE: GLD)	+2.8%	-2.5%
iPath S&P Crude Oil (NYSE: OIL)	-8.9%	-48.7%
PIMCO Total Return (Nasdaq: BOND)	+0.7%	+7.0%
PowerShares DB US $ Bullish (NYSE: UUP)	+0.7%	+12.5%
iPath S&P VIX ST Futures (NYSE: VXX)	+3.2%	-21.7%

Stocks have started the year with a heavy dose of volatility. Last week marked the first full week of trading, and it saw a sharp reversal of early year trading losses. Goldman Sachs (NYSE: GS) says it expects a significant decline for stocks over the next 4 to 6 weeks, though, due to extreme positive sentiment at the turn of the year. Oftentimes perception becomes reality, and a few money monkeys (financial market pundits) have already turned tail. Don’t fight the fear just yet, as this latest terrorism event in Paris has the potential of spreading contagious destructive inspiration to demented losers on U.S. shores. While we want to be contrarians, let’s not get run over by the herd either friends.

The Week Ahead

The economic schedule this week holds a few market-moving morsels for the market to chew on. While the NFIB Small Business Optimism Index should garner most of the attention on Tuesday, I would not look to it for guidance. Small businessmen are likely to be politically influenced, as the current administration has forced it to adapt to a higher cost structure. Where some have adapted and altered the structure of workforce to manage healthcare costs, others are simply bearing the weight and growing agitated. I anticipate a generally negative sentiment or skewed qualitative discussion from the group as a result through the 2016 election. Tuesday morning’s job openings data could prove useful. Job openings have improved significantly over the past year and economists expect the latest check to reflect that trend.

Wednesday’s retail sales data will show healthy growth before inclusion of gasoline sales, which will obviously be influenced by lower gas prices. This will force market participants to again think about the positives around lower energy prices, as will Alcoa’s (NYSE: AA) earnings report Tuesday. Industrials are energy sensitive, and Alcoa could be the first to really talk about significantly widened profit margins on energy cost decrease. Investors will want to also pay attention to the Fed Beige Book and Philly Fed President Plosser’s public appearance for market drivers; Plosser is a notorious hawk. The Atlanta Fed’s business inflation measure could color the market’s view as well, as could export and import price data. Import prices are going to reflect lower oil prices.

Manufacturing data due on Thursday should sway the day, with the Philadelphia and New York regional measures making the market. Healthy figures are expected to show continued U.S. manufacturing expansion and business activity in the Northeast. The Producer Price Index is due Thursday as well, and we will look past the headline figure to Core PPI to get an energy free perspective. Only mild price increase is expected here.

Friday offers the consumer level Consumer Price Index, and the Core CPI is likewise expected to only produce mild price rise. Dollar influence matters here now for price measures, so we may be misinterpreting what could be temporary benefit, but the market is not yet thinking this way. I’ll have more to say on the subject in the future. Consumer sentiment data is supposed to show improvement, and we would be fools to expect anything less given the sharp decrease in gas prices. Industrial production data is also due Friday, so there will be no rest for the weary as we close out the week.

THIS WEEK’S ECONOMIC REPORT SCHEDULE
Economic Data Point	Prior	Expected
MONDAY
Lockhart Speaks
Japan Market Closed
TUESDAY
Detroit Int’l Auto Show
NFIB Small Biz Index	98.1	98.1
ICSC Weekly Store Sales
-Year-to-Year Pace
Redbook Store Sales
JOLTS – Job Openings	4.834M	4.875M
Treasury Budget	-$56.8B	$3.0B
Needham Growth Conf.
Kocherlakota Speaks
WEDNESDAY
Retail Sales	+0.7%	-0.1%
-Less Autos & Gas	+0.6%	+0.6%
Mortgage Activity
EIA Petroleum Status
-Crude Oil Inventory
-Gasoline Inventory
Business Trade– Inventories	+0.2%	+0.3%
Export Prices	-1.0%	-0.5%
-Import Prices	-1.5%	-2.7%
Atlanta Fed Biz Inflation Index
Fed Beige Book
Plosser Speaks
THURSDAY
Producer Price Index	-0.2%	-0.4%
-Core PPI	+0.0%	+0.1%
Empire State Mfg. Index	-3.58	+5.0
Philly Fed Index	24.5	20.0
Weekly Jobless Claims	294K	295K
Bloomberg Consumer Comfort
EIA Natural Gas Report
FRIDAY
Consumer Price Index	-0.3%	-0.4%
-Core CPI	+0.1%	+0.1%
Industrial Production	+1.3%	-0.1%
-Capacity Utilization	80.1%	80.0%
Treasury Int’l Capital
Consumer Sentiment	93.6	94.0
Bullard Speaks

The earnings schedule will bring a focus to the start of the season. Alcoa kicks things off, and the big financials begin to report as the week progresses. Look for important news from Bank of America (NYSE: BAC), Citigroup (NYSE: C), Wells Fargo (NYSE: WFC), J.P. Morgan Chase (NYSE: JPM) and Goldman Sachs (NYSE: GS). I wonder if we’ll get our next big capacity cut and layoff news from the energy sector when Schlumberger (NYSE: SLB) reports on Thursday. Homebuilder K.B. Home (NYSE: KBH) will garner some attention this week as well, but investors will want to pay close attention to regional influences on various builders; I’ll talk more on this subject in the future, but I’m referring to recession in Texas.

HIGHLIGHTED EPS REPORTS
Company	Ticker
MONDAY
Affymetrix	Nasdaq: AFFX
Alcoa	NYSE: AA
American Realty Capital	Nasdaq: ARCP
Castlight Health	Nasdaq: CSLT
China Bak Battery	Nasdaq: CBAK
dELiA*s	Nasdaq: DLIAQ
Knowles	NYSE: KN
ONE Gas	NYSE: OGS
SemiLEDs	Nasdaq: LEDS
SYNNEX	NYSE: SNX
Washington Federal	Nasdaq: WAFD
TUESDAY
Boston Private Financial	Nasdaq: BPFH
Ceres	Nasdaq: CERE
CSX	NYSE: CSX
IHS	NYSE: IHS
K.B. Home	NYSE: KBH
Kinder Morgan	NYSE: KMI
Linear Technology	Nasdaq: LLTC
M.B. Financial	Nasdaq: MBFI
Progress Software	Nasdaq: PRGS
WEDNESDAY
Wells Fargo	NYSE: WFC
CLARCOR	NYSE: CLC
Greif	NYSE: GEF
H.B. Fuller	NYSE: FUL
J.P. Morgan Chase	NYSE: JPM
Nord Anglia Education	Nasdaq: NORD
Westamerica Bancorp	Nasdaq: WABC
THURSDAY
AEP Industries	Nasdaq: AEPI
Bank of America	NYSE: BAC
Bank of Ozarks	Nasdaq: OZRK
BlackRock	NYSE: BLK
Charles Schwab	Nasdaq: SCHW
Citigroup	NYSE: C
Commerce Bancshares	Nasdaq: CBSH
Fastenal	Nasdaq: FAST
First Republic Bank	NYSE: FRC
Home BancShares	Nasdaq: HOMB
Intel	Nasdaq: INTC
Lennar	NYSE: LEN
M&T Bank	NYSE: MTB
People’s United Financial	Nasdaq: PBCT
PPG Industries	NYSE: PPG
Schlumberger	NYSE: SLB
Wintrust Financial	Nasdaq: WTFC
WNS	NYSE: WNS
FRIDAY
Comerica	NYSE: CMA
Goldman Sachs	NYSE: GS
PNC Financial	NYSE: PNC
PrivateBancorp	Nasdaq: PVTB
SunTrust Banks	NYSE: STI

Other reports you should read:
Gold Outlook for 2015 – Buy and Hold Here
Market Outlook for 2015

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.