I See Questionable Drivers Behind 2 Big Chinese Stock Advances – Nasdaq: VALV and Nasdaq: KGJI

The most active stocks list Wednesday was volatile, with winners rising from 10% to 39% and decliners dropping from 9% to 42%. Chinese stocks led the list, you would think as the likely beneficiaries of favorably interpreted Chinese economic data, which was released Wednesday. However, my view of the real reasons behind two of the risers exposes what I believe are questionable drivers. So I say buyer beware.

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.

Relative tickers included: Nasdaq: VALV, NYSE: KKD, NYSE: ETE, NYSE: FF, Nasdaq: KIOR, Nasdaq: KGJI, Nasdaq: PBTH, Nasdaq: NEWN, Nasdaq: TAOM, AMEX: PAL, AMEX: BMJ, Nasdaq: SORL, Nasdaq: ALRN, Nasdaq: PPHM, Nasdaq: DYNT, Nasdaq: AFFM, AMEX: ALN, Nasdaq: CLNE, Nasdaq: BWOW, Nasdaq: SCMF, NYSE: GU, Nasdaq: SNFCA, Nasdaq: MDGN, Nasdaq: LBIX, NYSEArca: AGQ, Nasdaq: SPEX, Nasdaq: CHCI, Nasdaq: RGDX, Nasdaq: TSPT, Nasdaq: FPFC, Nasdaq: BKOR, Nasdaq: CRVP, NYSE: ITG, Nasdaq: TBSI, Nasdaq: LIME, Nasdaq: VTUS, Nasdaq: TOPSD, Nasdaq: BCAR, NYSEArca: ZSL, Nasdaq: BOVA, Nasdaq: OLCB, NYSE: OWW, Nasdaq: ADTN, AMEX: WGA, Nasdaq: PWAV, Nasdaq: AMTC, Nasdaq: CPSS, Nasdaq: CDTI, NYSE: TRU, NYSE: VR, Nasdaq: EONC, Nasdaq: BMTI, Nasdaq: ALTI, NYSE: YUM, NYSE: MAR, Nasdaq: ARTW, Nasdaq: OZRK, Nasdaq: ESBK, Nasdaq: EMMS, Nasdaq: FEIM, Nasdaq: FTLK, NYSE: GKK, Nasdaq: GFED, Nasdaq: IGTE, Nasdaq: LLEN, Nasdaq: MSW, Nasdaq: MFRI, Nasdaq: FIZZ, AMEX: UWN, Nasdaq: NFEC, Nasdaq: NTIC, Nasdaq: SLP, Nasdaq: UFPI, Nasdaq: WBNK, Nasdaq: WINA.

I See Questionable Drivers Behind 2 Big Chinese Stock Advances – Nasdaq: VALV and Nasdaq: KGJI

Shengkai Innovations

Wednesday’s most active risers was led by penny stock Shengkai Innovations Inc. (Nasdaq: VALV), which increased 39.5% on the day. Shengkai was mentioned in a China Analyst article as a leader among Chinese stocks in terms of ROE, with a reported 134.64% return over 12 months. The company was also noted to have a net profit margin of 69.42% over the same span. The wire was otherwise absent of reasoning for the rise in the stock. VALV makes ceramic valves, which it exports to the Asia-Pacific region, North America and Europe. Yahoo Finance has the float for this $58 million market capitalization stock at 8.0 million shares, so moving it was not so difficult. The listed P/E ratio on the stock is extremely low based on Yahoo data. However, we’re dealing with a small Chinese company here, so there are many unknowns about the industry, company and the opportunity. I would have been more interested in the stock and its move if the reason behind it were other than a PRish article.

Kingold Jewelry

Kingold Jewelry (Nasdaq: KGJI), another penny stock from China, benefited from a Street.com article listing it as 1 of 5 stocks insiders were snapping up. The article included Krispy Kreme Doughnuts (NYSE: KKD), Energy Transfer Equity (NYSE: ETE), FutureFuel (NYSE: FF), KiOR (Nasdaq: KIOR) and Kingold Jewelry (Nasdaq: KGJI). This stock is down significantly since last summer, and there must be a good reason for that wouldn’t you think? KGJI is off its high by 83% even after Wednesday’s 25% spurt higher. The founder of the company and its chairman may be a good guy who believes wholly in his company, and the stock does trade at a trailing P/E ratio of 4.7, which under normal conditions would seem cheap for a stock that sells into the expanding Chinese middle class.

But here’s the problem... Kingold sells gold jewelry, and as gold prices rise, its margins get squeezed and sales opportunities get limited. That’s why the stock is down over the last year in my view, and I think it’s a good reason. I would, however, look at this stock should gold prices indicate a longer term turn in trend lower. However, while I see gold backtracking off whatever high it sets Thursday, I don’t see it backing down far enough for jewelry retailers to become attractive long-term.

The remainder of the day’s upside list included: PROLOR Biotech (Nasdaq: PBTH), New Energy Systems (Nasdaq: NEWN), Taomee Holdings (Nasdaq: TAOM), North American Palladium (AMEX: PAL), Birks & Mayors (AMEX: BMJ), SORL Auto Parts (Nasdaq: SORL), American Learning (Nasdaq: ALRN), Peregrine Pharmaceuticals (Nasdaq: PPHM), Dynatronics (Nasdaq: DYNT), Affirmative Insurance (Nasdaq: AFFM), American Lorain (AMEX: ALN), Clean Energy Fuels (Nasdaq: CLNE), Wowjoint Holdings (Nasdaq: BWOW), Southern Community Financial (Nasdaq: SCMF), Gushan Environmental Energy (NYSE: GU), Security National Financial (Nasdaq: SNFCA), Medgenics (Nasdaq: MDGN), Leading Brands (Nasdaq: LBIX), ProShares Ultra Silver (NYSEArca: AGQ), Spherix (Nasdaq: SPEX), Comstock Homebuilding (Nasdaq: CHCI) and Response Genetics (Nasdaq: RGDX).

The leading losers list included: Transcept Pharmaceuticals (Nasdaq: TSPT), First Place Financial (Nasdaq: FPFC), Oak Ridge Financial (Nasdaq: BKOR), Crystal Rock (Nasdaq: CRVP), Investment Technology (NYSE: ITG), TBS International (Nasdaq: TBSI), Lime Energy (Nasdaq: LIME), Ventrus Biosciences (Nasdaq: VTUS), TOP Ships (Nasdaq: TOPSD), Bank of the Carolinas (Nasdaq: BCAR), ProShares Ultra Short Silver (NYSEArca: ZSL), Bank of Virginia (Nasdaq: BOVA), Ohio Legacy (Nasdaq: OLCB), Orbitz Worldwide (NYSE: OWW), ADTRAN (Nasdaq: ADTN), Wells-Gardner Electronics (AMEX: WGA), Powerwave Technologies (Nasdaq: PWAV), Ameritrans Capital (Nasdaq: AMTC), Consumer Portfolio Services (Nasdaq: CPSS), Clean Diesel Technologies (Nasdaq: CDTI), Torch Energy Royalty (NYSE: TRU), Validus Holdings (NYSE: VR), eOn Communications (Nasdaq: EONC), BioMimetic Therapeutics (Nasdaq: BMTI) and Altair Nanotechnologies (Nasdaq: ALTI).

The day’s earnings list included: Yum! Brands (NYSE: YUM), Marriott International (NYSE: MAR), ADTRAN (Nasdaq: ADTN), Art’s Way Manufacturing (Nasdaq: ARTW), Bank of the Ozarks (Nasdaq: OZRK), Elmira Savings Bank (Nasdaq: ESBK), Emmis Communications (Nasdaq: EMMS), Frequency Electronics (Nasdaq: FEIM), Funtalk China (Nasdaq: FTLK), Gramercy Capital (NYSE: GKK), Guaranty Federal Bancshares (Nasdaq: GFED), iGate (Nasdaq: IGTE), L&L Energy (Nasdaq: LLEN), Mission West Properties (Nasdaq: MSW), MFRI (Nasdaq: MFRI), National Beverage (Nasdaq: FIZZ), Nevada Gold & Casinos (AMEX: UWN), NF Energy (Nasdaq: NFEC), Northern Technologies International (Nasdaq: NTIC), Simulations Plus (Nasdaq: SLP), Universal Forest Products (Nasdaq: UFPI), Waccamaw Bankshares (Nasdaq: WBNK) and Winmark (Nasdaq: WINA).



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.

FedEx (NYSE: FDX) EPS Report Shows us a Hiding Place for Corporate American Ailments

We're On Guard for You Against Shady Tactics

FedEx (NYSE: FDX) shares rose 3% Thursday after it painted a rosy view of the economy and its own forward quarter outlook. The transportation company is an important barometer of the broader economy, and so its report and communications are important to all investors. But I'm warning readers to beware the current environment, because I see within it a place for corporate America to hide what ails it.

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.

Relative tickers: NYSE: FDX, NYSE: UPS, Nasdaq: CHRW, Nasdaq: EXPD, Nasdaq: UTIW, Nasdaq: HUBG, Nasdaq: FWRD, Nasdaq: ATSG, Nasdaq: PACR, Nasdaq: AIRT, Nasdaq: SINO, Nasdaq: WLGI, NYSE: UNP, NYSE: CNI, NYSE: CSX, NYSE: NSC, NYSE: CP, NYSE: KSU, NYSE: WAB, NYSE: GSH, NYSE: TRN, NYSE: GWR, NYSE: RA, NYSE: GBX, Nasdaq: ARII, Nasdaq: RAIL, Nasdaq: PWX, Nasdaq: JBHT, Nasdaq: LSTR, NYSE: CNW, Nasdaq: WERN, Nasdaq: ODFL, NYSE: KNX, Nasdaq: HTLD, Nasdaq: MRTN, NYSE: CGI, Nasdaq: ECHO, Nasdaq: UACL, Nasdaq: PATR, Nasdaq: SAIA, Nasdaq: QLTY, Nasdaq: USAK, Nasdaq: CVTI, Nasdaq: PTSI, Nasdaq: YRCW, AMEX: XPO, Nasdaq: FFEX, NYSE: TDW, NYSE: KEX, NYSE: TK, NYSE: TGP, NYSE: FRO, NYSE: CKH, Nasdaq: ALEX, NYSE: SFL, Nasdaq: DRYS, NYSE: TOO, Nasdaq: GLNG, NYSE: NAT, NYSE: SSW, NYSE: DSX, NYSE: NMM, NYSE: OSG, Nasdaq: CMRE, NYSE: HOS, NYSE: SB, OTC: VLCCF, NYSE: NM, NYSE: DAC, NYSE: TNK, NYSE: GNK, NYSE: EXM, NYSE: GSL, NYSE: TNP, Nasdaq: CPLP, Nasdaq: EGLE, NYSE: GMR, NYSE: DHT, Nasdaq: BALT, Nasdaq: STNG, Nasdaq: PRGN, Nasdaq: SBLK, Nasdaq: ULTR, Nasdaq: GASS, NYSE: ISH, Nasdaq: KSP, Nasdaq: ESEA, NYSE: HRZ, Nasdaq: TBSI, Nasdaq: RLOG, Nasdaq: DCIX, Nasdaq: GLBS, Nasdaq: OCNF, NYSE: TMM, Nasdaq: TRBR, Nasdaq: TOPS, AMEX: BHO, Nasdaq: FREE, Nasdaq: ONAV, Nasdaq: NEWL.

FedEx (NYSE: FDX) EPS Report Shows us a Hiding Place for Corporate American Ailments

FedEx shares rose despite the company's missing its fiscal third quarter target by a penny, after already having warned analysts that severe weather would impact its quarter. The final tally from the snowy December/January span cost the company approximately $0.12 in EPS. The company earned $0.81, excluding nonrecurring items, just shy of the adjusted $0.82 analyst consensus tallied by Bloomberg.

Besides that bad news, an analyst from Barclay's Capital (NYSE: BCS) estimates the company does $1.7 billion in annual business from Japan, some 4% of its total revenue. If that was not enough, gasoline and other fuel costs that strike at the core of FedEx's expenses, are on the rise without ceiling in sight.

Yet, FedEx overcame a potentially terrible Thursday by focusing the market's attention on the opportunity it has to ship relief and reconstruction supplies into Japan. Better yet, it projected EPS of $1.66 to $1.83 for its May quarter that left the analysts' consensus short at approximately $1.66 per share. That's the kind of good news the market rewards, and it did.

After its rosy forecast that supposedly takes into account the "current market outlook for fuel prices and continued moderate growth in the global economy," the market ignored FedEx's subtle warning that its earnings "could be affected by the effects of ongoing political turmoil in the Middle East and North Africa on fuel prices and the economy." After making the big prediction for its numbers, the company went on to warn that the uncertain situation in Japan could somehow affect its operating environment. Well duh!

I'm not saying FedEx is doing this, but it seems there is a cushion for companies now, and perhaps some are taking advantage of an opportunity to forecast liberally to overcome current bad news. After all, that gives a company a full three months to make the magic happen, or else just blame the next miss on the "extraordinary" chaos overseas. I'm just saying the volatile global environment allows some leeway for little white lies, not that anyone in corporate America would ever do something like that...



Article interests: FedEx (NYSE: FDX), United Parcels Service (NYSE: UPS), C.H. Robinson Worldwide (Nasdaq: CHRW), Expeditors International (Nasdaq: EXPD), UTI Worldwide (Nasdaq: UTIW), Hub Group (Nasdaq: HUBG), Forward Air (Nasdaq: FWRD), Air Transport Services (Nasdaq: ATSG), Pacer International (Nasdaq: PACR), Air T Inc. (Nasdaq: AIRT), Sino-Global Shipping America (Nasdaq: SINO), WLG Inc. (Nasdaq: WLGI), Union Pacific (NYSE: UNP), Canadian National Railway (NYSE: CNI), CSX (NYSE: CSX), Norfolk Southern (NYSE: NSC), Canadian Pacific Railway (NYSE: CP), Kansas City Southern (NYSE: KSU), Westinghouse Air Brake (NYSE: WAB), Guangshen Railway (NYSE: GSH), Trinity Industries (NYSE: TRN), Genesee & Wyoming (NYSE: GWR), RailAmerica (NYSE: RA), Greenbrier (NYSE: GBX), American Railcar (Nasdaq: ARII), FreightCar America (Nasdaq: RAIL), Providence & Worcester (Nasdaq: PWX), J.B. Hunt Transport (Nasdaq: JBHT), Landstar System (Nasdaq: LSTR), Con-way (NYSE: CNW), Werner Enterprises (Nasdaq: WERN), Old Dominion Freight (Nasdaq: ODFL), Knight Transportation (NYSE: KNX), Heartland Express (Nasdaq: HTLD), Marten Transport (Nasdaq: MRTN), Celadon Group (NYSE: CGI), Echo Global Logistics (Nasdaq: ECHO), Universal Truckload (Nasdaq: UACL), Patriot Transportation (Nasdaq: PATR), Saia (Nasdaq: SAIA), Quality Distribution (Nasdaq: QLTY), USA Truck (Nasdaq: USAK), Covenant Transportation (Nasdaq: CVTI), P.A.M. Transportation (Nasdaq: PTSI), YRC Worldwide (Nasdaq: YRCW), Express-1 Expedited Services (AMEX: XPO), Frozen Food Express (Nasdaq: FFEX), Tidewater (NYSE: TDW), Kirby (NYSE: KEX), Teekay (NYSE: TK), Teekay LNG Partners (NYSE: TGP), Frontline (NYSE: FRO), Seacor (NYSE: CKH), Alexander & Baldwin (Nasdaq: ALEX), Ship Finance International (NYSE: SFL), DryShips (Nasdaq: DRYS), Teekay Offshore Partners (NYSE: TOO), Golar LNG (Nasdaq: GLNG), Nordic American Tanker (NYSE: NAT), Seaspan (NYSE: SSW), Diana Shipping (NYSE: DSX), Navios Maritime Partners (NYSE: NMM), Overseas Shipholding (NYSE: OSG), Costamare (Nasdaq: CMRE), Hornbeck Offshore (NYSE: HOS), Safe Bulkers (NYSE: SB), Knightsbridge Tankers (OTC: VLCCF), Navios Maritime (NYSE: NM), Danaos (NYSE: DAC), Teekay Tankers (NYSE: TNK), Genco Shipping (NYSE: GNK), Excel Maritime (NYSE: EXM), Global Ship Lease (NYSE: GSL), Tsakos Energy Navigation (NYSE: TNP), Capital Product Partners (Nasdaq: CPLP), Eagle Bulk Shipping (Nasdaq: EGLE), General Maritime (NYSE: GMR), DHT Holdings (NYSE: DHT), Baltic Trading (Nasdaq: BALT), Scorpio Tankers (Nasdaq: STNG), Paragon Shipping (Nasdaq: PRGN), Star Bulk Carriers (Nasdaq: SBLK), Ultrapetrol (Nasdaq: ULTR), StealthGas (Nasdaq: GASS), International Shipholding (NYSE: ISH), K-Sea Transportation (Nasdaq: KSP), Euroseas (Nasdaq: ESEA), Horizon Lines (NYSE: HRZ), TBS International (Nasdaq: TBSI), Rand Logistics (Nasdaq: RLOG), Diana Containerships (Nasdaq: DCIX), Globus Maritime (Nasdaq: GLBS), OceanFreight (Nasdaq: OCNF), Grupo TMM (NYSE: TMM), Trailer Bridge (Nasdaq: TRBR), Top Ships (Nasdaq: TOPS), B&H Ocean (AMEX: BHO), FreeSeas (Nasdaq: FREE), Omega Navigation (Nasdaq: ONAV), NewLead (Nasdaq: NEWL).

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's (Nasdaq: AAPL) Smart PR Effort and Our Outlook

Managing Disaster

Apple's PR team did a decent job of best managing the worst possible scenario, the loss of its iconic leader, but we suspect guarding against investor concern will require a little more than just blowout earnings.

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.

Relative Tickers: Nasdaq: AAPL, Nasdaq: DELL, Nasdaq: GOOG, Nasdaq: RIMM, NYSE: HPQ, Nasdaq: MSFT, Nasdaq: AMZN, NYSE: NOK, NYSE: GLW, NYSE: MOT, NYSE: ALU, NYSE: HRS, Nasdaq: TLAB, NYSE: SNE, NYSE: PHG, NYSE: PC, NYSE: HIT, NYSE: ST, NYSE: HUB-B, NYSE: HAR, Nasdaq: GNRC, Nasdaq: DTSI, NYSE: FN, NYSE: TCH, NYSE: LXU, Nasdaq: UEIC, NYSE: VPG, Nasdaq: KLIC, Nasdaq: KLAC, Nasdaq: COHR, Nasdaq: DSPG, NYSE: PLT, Nasdaq: BBOX, NYSE: EMC, NYSE: BAC, Nasdaq: ALTR, Nasdaq: ISRG, NYSE: FRX, NYSE: AOS, NYSE: AEP, Nasdaq: ASRV, Nasdaq: ASTE, NYSE: BMI, NYSE: BK, Nasdaq: BBND, NYSE: BSX, Nasdaq: CREE, Nasdaq: CYBI, Nasdaq: DTLK, Nasdaq: DEAR, NYSE: DPZ, Nasdaq: EFSC, Nasdaq: ESBF, Nasdaq: FBCM, Nasdaq: FLXS, Nasdaq: FLTTE, Nasdaq: FFIC, AMEX: FRS, Nasdaq: FSII, Nasdaq: FULT, Nasdaq: GILD, NYSE: GS, Nasdaq: HA, NYSE: HDB, NYSE: HNP, Nasdaq: HUBG, NYSE: ITW, Nasdaq: JNPR, Nasdaq: MRTN, Nasdaq: MICC, NYSE: MLI, Nasdaq: ONAV, NYSE: OMC, NYSE: PH, Nasdaq: PWOD, Nasdaq: PVSW, NYSE: PII, Nasdaq: RCRC, Nasdaq: RNST, Nasdaq: SONC, Nasdaq: SFST, NYSE: STT, Nasdaq: STSA, NYSE: TPX, NYSE: MNI, NYSE: NYT, NYSE: TUP, Nasdaq: TWIN, NYSE: UNF, NYSE: UNH, NYSE: WCN, NYSE: WFT, Nasdaq: WABC, NYSE: WDC, Nasdaq: WSCI, Nasdaq: YHOO, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ

Apple's (Nasdaq: AAPL) Smart PR Effort and Our Outlook

Apple (Nasdaq: AAPL) smartly tried to control the impact of the announcement that its idea-man and CEO Steve Jobs would need to take a medical leave of absence. The pre-release of this unfortunate information, ahead of the blowout earnings numbers, were meant to allow a free flow of funds to occur on the good news. If both pieces of data were released at the same time, the effect would very likely have been neutral to negative for AAPL shares. If only The Greek were focused Tuesday on Apple, we might have offered you an opportunity to benefit from beaten down call options before they stabilized and recovered. So now the best we can do is prepare you for the decision tree before you and the prospects for Apple, short, medium and long-term.

While it's clear what Apple's PR people were up to this past weekend (basically the best possible handling of the worst possible situation), what they may not be able to stave off no matter how hard they try is investor realization of the risk of the long-term loss of Jobs to Apple and its shares. Though the company is doing its best to make this seem bearable, we suggest investors will increasingly question whether it is or not. As that uncertainty plays out and gains play, pressure should build on Apple shares, and so any momentum to the upside would seem to offer wise opportunity to seek a new driver for technology born capital investment gains - thus to exit AAPL and replace it with something else near-term.

Apple shares were up $4.25 or 1.25% after hours Tuesday after reporting EPS Tuesday afternoon, but only after falling $7.83 (2.25%) through the day Tuesday, the first day of trading since the best-timed release of Jobs' unfortunate news. AAPL shares had held their gain through much of Wednesday, but heading into the close Apple shares had moved back into negative territory. At the close, the stock had to account for a loss of near 1%.

It took this long for good reason, as the company posted blowout earnings, exceeding analysts' expectations by nearly 19%. The EPS gain was an astounding 78% greater than the year ago quarter. The company's quarterly net income, for one quarter and after expenses, was six billion dollars. Apple's sales increased 71%, to $26.7 billion in the quarter. Granted, this was the most important quarter for the consumer oriented firm, but still, those are blowout numbers, period.

Thus, Apple's PR people had quite a situation before them with regard to how to manage the news that their iconic CEO would need to leave day-to-day operations to take care of himself. Given his importance to Apple, and the perception of his importance to Apple, this became more than just a problem of how to author a public release to best serve the man. Rather, it needed to manage how investors, both current and prospective might react to this clearly unplanned division of the company and its brilliant CEO.

You'll note that in the short release, a letter Jobs' authored to employees, he states that he will remain CEO and that the 2011 operating strategy had already been laid out. In other words, he'll still be actively involved, but off-site for the most part, while he takes care of his health problem. Secondly, there's reassurance in the fact that all the important product planning has occurred already for this year, so whatever magic might be lost, perhaps another amazing year lay in store for Camelot in 2011 at least.

I know where I would focus my product attention if I were Apple, but I'm still saving that idea for a later article I had better get to soon. While AAPL shares are drifting now, be careful not to underestimate the company's marketing savvy, nor its PR prescience. Another release or important news item might lay in store for just that scenario. That said, I would expect the company to let the news of Jobs' temporary leave sink in and digest completely before any such release were made. Thus, I would be taking short-term profits in AAPL, outside of valuation and on just an artistic point of view (versus scientific). I'm not even going to talk valuation in this article, because I don't expect it will matter given the special situation.

Besides the idea-man issue, what can make a seemingly cheap stock get cheaper is when it runs the risk of losing market share. It's hard for an innovation leader of Apple's size to keep growing, and it gets increasingly easier for such a firm to fall off the top of the hill. I only need reference all the competitors and products out there that appeal to the non-fanatical fans of Apple. These are market share threats that are being discounted by investment pros of any worth right now, considering that the genius Jobs has been stumbled. That said, let me remind you that over the medium term, beware the risk of already prepared corporate plans and a still savvy PR team at Apple. The next great catalyst for Apple and stopper of a stock slide could be just an email delivery away.

Short-Short Term: Sell
Medium Term: Buy
Long Term: Not So Clear Yet - Hold



Disclosure: I have no notable position in any relative stock

Article should interest investors in Apple (Nasdaq: AAPL), Dell (Nasdaq: DELL), Research in Motion (Nasdaq: RIMM), Hewlett-Packard (NYSE: HPQ), Microsoft (Nasdaq: MSFT), Amazon.com (Nasdaq: AMZN), Nokia (NYSE: NOK), Corning (NYSE: GLW), Motorola (NYSE: MOT), Alcatel-Lucent (NYSE: ALU), Harris (NYSE: HRS), Tellabs (Nasdaq: TLAB), Sony (NYSE: SNE), Philips (NYSE: PHG), Panasonic (NYSE: PC), Hitachi (NYSE: HIT), Sensata (NYSE: ST), Hubbell (NYSE: HUB.B), Harman (NYSE: HAR), Generac (Nasdaq: GNRC), DTS (Nasdaq: DTSI), Fabrinet (NYSE: FN), Technicolor (NYSE: TCH), LSB Industries (NYSE: LXU), Universal Electronics (Nasdaq: UEIC), Vishay Precision (NYSE: VPG).

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.

Addicted Market Could Crash Off High

Coming Down Off Liquidity High

Wall Street Greek Technical Strategist Steven Ferguson offers a fresh look at the perilous technical high wire act the market seems to be performing, and he warns again of serious trouble signs in the charts.

Relative Tickers: NYSE: GS, NYSE: C, NYSE: BAC, NYSE: WFC, NYSE: MS, NYSE: JPM, NYSE: TD, NYSE: PNC, Nasdaq: TROW, NYSE: STT, NYSE: STD, NYSE: DB, NYSE: BCS, NYSE: NBG, NYSE: JNS, NYSE: BX, NYSE: BLK, Nasdaq: ETFC, Nasdaq: TSCM, Nasdaq: AMTD, Nasdaq: MEMKX, Nasdaq: GECMX, Nasdaq: JEVOX, Nasdaq: PEMAX, NYSE: EEM, NYSE: VWO, Nasdaq: VEIEX, Nasdaq: ADRE, Nasdaq: PEBIX, Nasdaq: GMCEX, NYSE: MSF, NYSE: EEV, Nasdaq: REMGX, NYSE: GMM, NYSE: EDZ, AMEX: ETF, NYSE: FEO, NYSE: ESD, NYSE: MSD, NYSE: EMF, NYSE: TEI, Nasdaq: EMIF, NYSE: EFN, NYSE: EMT, NYSE: PCY, NYSE: PXH, NYSE: GMF, NYSE: GUR, NYSE: GML, NYSE: GMM, NYSE: EWX, NYSE: GAF, NYSE: EUF, NYSE: EET, Nasdaq: ABEMX, Nasdaq: AEMGX, Nasdaq: APERX, Nasdaq: PMGAX, Nasdaq: PMCIX, Nasdaq: AOTAX, Nasdaq: AOTCX, Nasdaq: AOTDX, Nasdaq: AEMPX, Nasdaq: AOTIX, Nasdaq: AEMEX, Nasdaq: AAMRX, Nasdaq: AEMFX, Nasdaq: AAEPX, Nasdaq: AEMMX, Nasdaq: ACKBX, Nasdaq: ACECX, Nasdaq: AMKIX, Nasdaq: TWMIX, Nasdaq: NDAQ, NYSE: PIZ, NYSE: PIE, NYSE: PDP, NYSE: DIA, NYSE: SPY, NYSE: NYX, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: IWM, NYSE: TWM, NYSE: IWD, NYSE: SDK, NYSE: ICE, Nasdaq: QQQQ, Nasdaq: HTOAX, Nasdaq: HTOTX, Nasdaq: HTOBX, Nasdaq: JTCIX, Nasdaq: JTCNX, Nasdaq: JTCAX.

Addicted Market Could Crash Off High

For a market propelled to new recovery highs by the same liquid(ity) drug that has fueled every major asset bubble in the past, and that has led to the current credit crisis hangover, the moment of truth has arrived. Either a correction will begin this week, or it will be postponed to another date several weeks or even months in the future, with the potential for drop only becoming more dramatic as that date with destiny is forestalled.

Either the S&P will fall below key support at 1260 or it will rise a minimum of 30 points higher. Should the S&P remain above 1291, I believe traders should cover open short positions.

Major indices closed Friday at the top of a trend-line that forms the upper boundary of a bearish rising wedge, depicted in the chart below. The rising wedge has formed within a larger trend channel. The more times that prices traverse between the lower and upper boundary of that channel, the weaker market internals have become. It is under these circumstances that we most often observe the Hindenburg Omen indicator.



As well, the Elliot Wave structure, depicted in the chart below, now satisfies pattern identification rules for completion of the rally. Note that the entire rally is comprised of an A-B-C wave structure, where the index is presently completing wave C. Wave C is annotated in blue, with the five sub-waves each depicted individually. Importantly, the magnitude and duration of the move accomplished by the fifth wave in a five wave pattern now satisfies optimal criteria for pattern completion. And although Elliot Wave rules would have allowed the fifth wave to terminate at any time, such a pattern rarely truncates before the length of wave five equals that of wave one. Such is now the case, as can be seen through visual comparison of sub-waves 1 and 5 in the chart below.



We also note that an important and reliable Phi Turn window has now passed. The clock is ticking on a confirmed Hindenburg Omen. Credit turmoil continues to churn even as the upchuck is swabbed down the financial drain. If markets continue to rise significantly above Friday's close, the next target is 2.5% higher again at the top of the trend channel. For a correction to begin in earnest, support levels must be penetrated. Greek readers must remain vigilant.



Disclosure: I am short S&P 500 Index Futures

Article may interest investors in NYSE: GS, NYSE: C, NYSE: BAC, NYSE: WFC, NYSE: MS, NYSE: JPM, NYSE: TD, NYSE: PNC, Nasdaq: TROW, NYSE: STT, NYSE: STD, NYSE: DB, NYSE: BCS, NYSE: NBG, NYSE: JNS, NYSE: BX, NYSE: BLK, Nasdaq: MEMKX, Nasdaq: GECMX, Nasdaq: JEVOX, Nasdaq: PEMAX, NYSE: EEM, NYSE: VWO, Nasdaq: VEIEX, Nasdaq: ADRE, Nasdaq: PEBIX, Nasdaq: GMCEX, NYSE: MSF, NYSE: EEV, Nasdaq: REMGX, NYSE: GMM, NYSE: EDZ, AMEX: ETF, NYSE: FEO, NYSE: ESD, NYSE: MSD, NYSE: EMF, NYSE: TEI, Nasdaq: EMIF, NYSE: EFN, NYSE: EMT, NYSE: PCY, NYSE: PXH, NYSE: GMF, NYSE: GUR, NYSE: GML, NYSE: GMM, NYSE: EWX, NYSE: GAF, NYSE: EUF, NYSE: EET, Nasdaq: ABEMX, Nasdaq: AEMGX, Nasdaq: APERX, Nasdaq: PMGAX, Nasdaq: PMCIX, Nasdaq: AOTAX, Nasdaq: AOTCX, Nasdaq: AOTDX, Nasdaq: AEMPX, Nasdaq: AOTIX, Nasdaq: AEMEX, Nasdaq: AAMRX, Nasdaq: AEMFX, Nasdaq: AAEPX, Nasdaq: AEMMX, Nasdaq: ACKBX, Nasdaq: ACECX, Nasdaq: AMKIX, Nasdaq: TWMIX, Nasdaq: NDAQ, NYSE: PIZ, NYSE: PIE, NYSE: PDP, NYSE: DIA, NYSE: SPY, NYSE: NYX, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: IWM, NYSE: TWM, NYSE: IWD, NYSE: SDK, NYSE: ICE, Nasdaq: QQQQ, Nasdaq: HTOAX, Nasdaq: HTOTX, Nasdaq: HTOBX, Nasdaq: JTCIX, Nasdaq: JTCNX, Nasdaq: JTCAX.

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.

Spike in Jobless Claims Could Mark a Market Top

Sell Catalyst

Weekly Initial Jobless Claims spiked higher in the latest check, stopping a recent burst in a medium-term market rally that began at the close of last summer. The rally ignited on GOP momentum that gave investors hope for a more hospitable business and tax environment. The market has gained new energy over recent weeks on decent consumer relative reports and on an important dive in jobless claims below the psychological threshold just developed of 400K. However, as we laid out in recent coverage, the dive was anomalous, due to seasonal factors that have effectively reversed through the latest data-point. Given technical omens overhanging, and restored bricks in the wall of worry, including unemployment and inflation, I think there is a good possibility that we have marked a near-term top for stocks. So, this appears to be a smart time to reduce risk.

Relative Tickers: NYSE: RHI, NYSE: KFY, NYSE: MAN, NYSE: MWW, Nasdaq: KELYA, Nasdaq: JOBS, NYSE: JOB, Nasdaq: CECO, Nasdaq: PAYX, NYSE: ASF, Nasdaq: KFRC, NYSE: TBI, NYSE: DHX, NYSE: SFN, NYSE: CDI, Nasdaq: CCRN, Nasdaq: ASGN, NYSE: AHS, Nasdaq: BBSI, Nasdaq: HHGP, NYSE: SRT, Nasdaq: RCMT, Nasdaq: VSCP, Nasdaq: TSTF, NYSE: BAC, NYSE: JPM, NYSE: GS, NYSE: C, NYSE: MS, NYSE: WFC, NYSE: TD, NYSE: PNC, NYSE: GE, NYSE: WMT, NYSE: MCD, NYSE: AA, NYSE: AXP, NYSE: BA, NYSE: CAT, Nasdaq: CSCO, NYSE: CVX, NYSE: DD, NYSE: DIS, NYSE: HD, NYSE: HPQ, NYSE: IBM, Nasdaq: INTC, NYSE: JNJ, NYSE: KFT, NYSE: KO, NYSE: MMM, NYSE: MRK, Nasdaq: MSFT, NYSE: PFE, NYSE: PG, NYSE: T, NYSE: TRV, NYSE: UTX, NYSE: VZ, NYSE: XOM, NYSE: DE, NYSE: TIF, NYSE: CO, NYSE: FRO, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ, Nasdaq: INTC, NYSE: CRAI, Nasdaq: CBSH, Nasdaq: INFY, NYSE: ZZ, NYSE: SJR, Nasdaq: SHFL, Nasdaq: TSTF, Nasdaq: ABMD, Nasdaq: ARNA, Nasdaq: MYGN, Nasdaq: CLDA, Nasdaq: ELGX, Nasdaq: AFFX, Nasdaq: AFAM, Nasdaq: GIVN, Nasdaq: VITA, Nasdaq: BCRX, Nasdaq: ISIS, NYSE: WTW, Nasdaq: HNSN, Nasdaq: PRXL, Nasdaq: BIOD, Nasdaq: CRA, Nasdaq: ERES, Nasdaq: GTIV, Nasdaq: CALP, Nasdaq: SRCL, NYSE: TMH, Nasdaq: ABCO, Nasdaq: ANTH, Nasdaq: CPHD, Nasdaq: SKH, Nasdaq: URBN, Nasdaq: CBOU, Nasdaq: FNGN, Nasdaq: GTLT, Nasdaq: PMFG, Nasdaq: TRID, Nasdaq: TRMB, Nasdaq: WBMD, Nasdaq: LTXC, Nasdaq: MDSO, Nasdaq: POWI, Nasdaq: RMBS, Nasdaq: SPEC, Nasdaq: DAKT, Nasdaq: AONE, Nasdaq: SCOR, Nasdaq: DDIC, Nasdaq: FSII, Nasdaq: SWKS, NYSE: QTM, Nasdaq: SDBT, Nasdaq: UTKE, Nasdaq: CRAY, Nasdaq: FEIC, Nasdaq: TINY, NYSE: HPQ.

Spike in Jobless Claims Could Mark a Market Top

Weekly Jobless Claims for the week ended January 8 climbed by 35,000 to a stock stymieing 450K mark. Between this week's data and last week's, in which weekly claims reemerged above the psychological 400K level (from 391K), it's become clear that seasonality was behind the dulling of unemployment claims in December, which we outlined in several articles.

Over the last few months, we have paid attention and detailed for you growing market enthusiasm as claims moved toward 450K and then toward 400K. There was a direct, though unscientifically defined here, correlation between the two, at least for short-term trading. We noted then expectations that a solid rally could gain fuel from ongoing improvement in the market's greatest area of concern, unemployment.

However, this week's report sort of kills that hope, or at least stymies it in the short term. The four-week moving average of jobless claims moved up by 5,500, which is a significant increase, to 416,500. The insured unemployment rate, which is supposedly seasonally adjusted, was reported today for a lagged period (January 1), and so is not consistent with the other data noted here. Insured unemployment improved by two-tenths of a point to 3.1%, but look for this rate to rise next week.

We again suggest that just as everything else outside of shopping slows in December, so did layoffs and new filings for unemployment. This post holiday season spurt to 450K though, could also be somewhat reactionary, and lifted by pent-up demand for unemployment checks. So, we may not see claims spike higher, or they could even ease a bit from here, but claims seem likely to hold above the 400K mark in the near-term. Given that the market seems to need claims below 400K for confirmation of labor market improvement, stocks should express some disappointment.

The unemployment rate improved in December, but was highly suspect, given the disappearance of twice as many unemployed Americans than the number of newly employed citizens. Given this fact and a smaller than expected increase in nonfarm payrolls, we saw an implication that many Americans had fallen into despair over the holidays and were not counted as unemployed for whatever reason. We look for the unemployment rate to increase again in January as a result.

According to our Technical Analyst Steven Ferguson, several measures show a market fully exploited, and while he notes this does not signify market crash is imminent (though the Hindenburg Omen implies one could be near), he certainly sees a strong likelihood for at least a rounded top in the near-term. Given the technical environment, and the labor market catalyst defined above in the unemployment data, and with increasing worry about global commodity inflation and its potential to infect other goods, too many signs offer wisdom for risk reduction today. Are you paying attention? We just made a broad market call.



FYI:

The highest insured unemployment rates in the week ending Dec. 25 were in Alaska (7.5 percent), Oregon (5.2), Idaho (5.1), Montana (4.9), Wisconsin (4.8), Pennsylvania (4.7), Puerto Rico (4.6), Nevada (4.5), Illinois (4.4), and Michigan (4.3).

The largest increases in initial claims for the week ending Jan. 1 were in Georgia (+11,997), Michigan (+10,129), Pennsylvania (+9,004), New York (+8,379), and Wisconsin (+7,236), while the largest decreases were in California (-13,694), Florida (-1,867), Nevada (-972), Kansas (-841), and New Mexico (-721).

The day's corporate schedule Intel's EPS report (Nasdaq: INTC), and reports by Charles River Associates (NYSE: CRAI), Commerce Bankshares (Nasdaq: CBSH), Infosys (Nasdaq: INFY), Sealy (NYSE: ZZ), Shaw Communications (NYSE: SJR), Shuffle Master (Nasdaq: SHFL), TeamStaff (Nasdaq: TSTF) and more.

The JP Morgan Health Conference offers presentations by Abiomed (Nasdaq: ABMD), Arena Pharm (Nasdaq: ARNA), Myriad (Nasdaq: MYGN), Clinical Data (Nasdaq: CLDA), Endologix (Nasdaq: ELGX), Affymetrix (Nasdaq: AFFX), Almost Family (Nasdaq: AFAM), Given Imaging (Nasdaq: GIVN), Orthovita (Nasdaq: VITA), BioCryst (Nasdaq: BCRX), Isis (Nasdaq: ISIS), Weight Watchers (NYSE: WTW), Hansen Medical (Nasdaq: HNSN), Parexel (Nasdaq: PRXL), Biodel (Nasdaq: BIOD), Celera (Nasdaq: CRA), eResearch Technology (Nasdaq: ERES), Gentiva (Nasdaq: GTIV), Caliper Life Sciences (Nasdaq: CALP), Stericycle (Nasdaq: SRCL), Team Health (NYSE: TMH), Advisory Board (Nasdaq: ABCO), Anthera (Nasdaq: ANTH), Cepheid (Nasdaq: CPHD), Skilled Healthcare (Nasdaq: SKH), . The XChange Investor Conference produces reports from Urban Outfitters (Nasdaq: URBN) and Caribou Coffee (Nasdaq: CBOU) and others. The Needham Growth Conference offers a slew of presentations, including Financial Engines (Nasdaq: FNGN), Global Telecom (Nasdaq: GTLT), Peerless (Nasdaq: PMFG), Trident Microsystems (Nasdaq: TRID), Trimble Navigation (Nasdaq: TRMB), WebMD (Nasdaq: WBMD), LTX-Credence (Nasdaq: LTXC), Medidata Solutions (Nasdaq: MDSO), Power Integrations (Nasdaq: POWI), Rambus (Nasdaq: RMBS), Spectrum Control (Nasdaq: SPEC), Daktronics (Nasdaq: DAKT), A123 (Nasdaq: AONE), comScore (Nasdaq: SCOR), Ddi (Nasdaq: DDIC), FSI Int'l (Nasdaq: FSII), Skyworks (Nasdaq: SWKS), Quantum (NYSE: QTM), Soundbite (Nasdaq: SDBT), Ultratech (Nasdaq: UTKE), Cray (Nasdaq: CRAY), FEI (Nasdaq: FEIC), Harris and Harris (Nasdaq: TINY) and many others. Hewlett-Packard (NYSE: HPQ) has its Technology Series conference focused on "Changing the Rules of Networking."

Article should interest investors in Paychex (Nasdaq: PAYX), Manpower (NYSE: MAN), Robert Half International (NYSE: RHI), 51Job Inc. (Nasdaq: JOBS), Monster World Wide (NYSE: MWW), Korn/Ferry International (NYSE: KFY), Administaff (NYSE: ASF), Kforce (Nasdaq: KFRC), TrueBlue (NYSE: TBI), Dice Holdings (NYSE: DHX), Kelly Services (Nasdaq: KELYA), SFN Group (NYSE: SFN), CDI Corp. (NYSE: CDI), Cross Country Healthcare (Nasdaq: CCRN), On Assignment (Nasdaq: ASGN), AMN Healthcare Services (NYSE: AHS), Barrett Business Services (Nasdaq: BBSI), Hudson Highland Group (Nasdaq: HHGP), StarTek (NYSE: SRT), RCM Technologies (Nasdaq: RCMT), VirtualScopics (Nasdaq: VSCP).

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.

Imminent Stock Market Decline

The Long and Short of It

In his last article, Wall Street Greek Technical Analyst Steven Ferguson outlined several ominous technical indicators that point to a change in market direction. In this piece, he clarifies and further details how the turn might play out given various factors at play. Ferguson says a "rounded top" is more likely in the near-term, which supports the exit from long positions at this point, while not necessarily directing immediate aggressive shorting.

Relative Tickers: NYSE: GS, NYSE: C, NYSE: BAC, NYSE: WFC, NYSE: MS, NYSE: JPM, NYSE: TD, NYSE: PNC, Nasdaq: TROW, NYSE: STT, NYSE: STD, NYSE: DB, NYSE: BCS, NYSE: NBG, NYSE: JNS, NYSE: BX, NYSE: BLK, Nasdaq: ETFC, Nasdaq: TSCM, Nasdaq: AMTD, Nasdaq: MEMKX, Nasdaq: GECMX, Nasdaq: JEVOX, Nasdaq: PEMAX, NYSE: EEM, NYSE: VWO, Nasdaq: VEIEX, Nasdaq: ADRE, Nasdaq: PEBIX, Nasdaq: GMCEX, NYSE: MSF, NYSE: EEV, Nasdaq: REMGX, NYSE: GMM, NYSE: EDZ, AMEX: ETF, NYSE: FEO, NYSE: ESD, NYSE: MSD, NYSE: EMF, NYSE: TEI, Nasdaq: EMIF, NYSE: EFN, NYSE: EMT, NYSE: PCY, NYSE: PXH, NYSE: GMF, NYSE: GUR, NYSE: GML, NYSE: GMM, NYSE: EWX, NYSE: GAF, NYSE: EUF, NYSE: EET, Nasdaq: ABEMX, Nasdaq: AEMGX, Nasdaq: APERX, Nasdaq: PMGAX, Nasdaq: PMCIX, Nasdaq: AOTAX, Nasdaq: AOTCX, Nasdaq: AOTDX, Nasdaq: AEMPX, Nasdaq: AOTIX, Nasdaq: AEMEX, Nasdaq: AAMRX, Nasdaq: AEMFX, Nasdaq: AAEPX, Nasdaq: AEMMX, Nasdaq: ACKBX, Nasdaq: ACECX, Nasdaq: AMKIX, Nasdaq: TWMIX, Nasdaq: NDAQ, NYSE: PIZ, NYSE: PIE, NYSE: PDP, NYSE: DIA, NYSE: SPY, NYSE: NYX, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: IWM, NYSE: TWM, NYSE: IWD, NYSE: SDK, NYSE: ICE, Nasdaq: QQQQ, Nasdaq: HTOAX, Nasdaq: HTOTX, Nasdaq: HTOBX, Nasdaq: JTCIX, Nasdaq: JTCNX, Nasdaq: JTCAX.

Imminent Stock Market Decline: The Long and Short of It

At present, it would appear that the market turning point is indeed at hand. The Greek exposited the real unemployment situation in his recap of Friday's labor report, which as usual, was meant to obscure the truth. Here in the Midwest, most of those I know on unemployment rolls have given up looking for work and would prefer to continue receiving their perpetual entitlement. And those who could offer them employment are uncertain about capital expenditures in the future, so they continue to do more with less while they still have more to do.

Do these signs of an enervated economy mean a stock market crash (or worse, a bond market crash!) is imminent? Did any of the technical indicators reviewed in "Who You Callin Short?" suggest a 20% decline should occur over the next five trading sessions? Certainly not. And just in case there might be any confusion as to the nature of the prediction offered by the previous article, here are some key clarifications:

• None of the cited technical indicators suggested that there would be any dramatic sell-off occurring on or about January 6, 2011. Instead, the Phi Turn date predicts a turning point in market action, probably containing an intraday high that would last for many weeks if not months/years (depending on whether the Phi Turn event marks THE top). The Phi Turn date has a tolerance of a few days in either direction. The presence of two Phi Turns within the past 6 trading session suggests that the turn may have occurred on Thursday.


• However, given the strong uptrend that has led to this point, the actual reversal is more likely to form a "rounded top" than a sharp ski slope. There remains a possibility within the Elliot Wave count (five of five) that the DOW could reach back to the 11750-11775 range, corresponding to 1280-1291 on the S&P. This would allow for one more intraday high early this week without violating the rules of the wave pattern. After that, a return to higher volatility is to be expected as the VIX appears ready to break out.


• Still, we note that the S&P cash index dropped ten points intraday on Friday to a very important line of technical support, 1260. A break below this support early this week would solidify the case for the market reversal. A convincing break back above 1291 would signal several more weeks of uptrend, with the projected price 2.5% above the previous 52-week high.


• Last, the confirmed Hindenburg Omen does forebode a steep decline but not necessarily an imminent one. In the last 25 years, Dr. Robert McHugh of Main Line Investors, Inc. found that 28 "officially" confirmed Hindenburg Omen signals have occurred. In all but one of those cases, a decline of at least 5% followed. In almost a third of those cases, a crash of 15-20% or more occurred. The precipitous decline could start at any time and could last any number of trading sessions.

Based on the above, this author recommends that readers take profits from long positions. More aggressive traders may weigh short positions in index ETFs, sectors or individual stocks that are highly correlated with the market at large. That's the long and the short of it.

Disclosure: I am short S&P 500 Index Futures



Article may interest investors in NYSE: GS, NYSE: C, NYSE: BAC, NYSE: WFC, NYSE: MS, NYSE: JPM, NYSE: TD, NYSE: PNC, Nasdaq: TROW, NYSE: STT, NYSE: STD, NYSE: DB, NYSE: BCS, NYSE: NBG, NYSE: JNS, NYSE: BX, NYSE: BLK, Nasdaq: MEMKX, Nasdaq: GECMX, Nasdaq: JEVOX, Nasdaq: PEMAX, NYSE: EEM, NYSE: VWO, Nasdaq: VEIEX, Nasdaq: ADRE, Nasdaq: PEBIX, Nasdaq: GMCEX, NYSE: MSF, NYSE: EEV, Nasdaq: REMGX, NYSE: GMM, NYSE: EDZ, AMEX: ETF, NYSE: FEO, NYSE: ESD, NYSE: MSD, NYSE: EMF, NYSE: TEI, Nasdaq: EMIF, NYSE: EFN, NYSE: EMT, NYSE: PCY, NYSE: PXH, NYSE: GMF, NYSE: GUR, NYSE: GML, NYSE: GMM, NYSE: EWX, NYSE: GAF, NYSE: EUF, NYSE: EET, Nasdaq: ABEMX, Nasdaq: AEMGX, Nasdaq: APERX, Nasdaq: PMGAX, Nasdaq: PMCIX, Nasdaq: AOTAX, Nasdaq: AOTCX, Nasdaq: AOTDX, Nasdaq: AEMPX, Nasdaq: AOTIX, Nasdaq: AEMEX, Nasdaq: AAMRX, Nasdaq: AEMFX, Nasdaq: AAEPX, Nasdaq: AEMMX, Nasdaq: ACKBX, Nasdaq: ACECX, Nasdaq: AMKIX, Nasdaq: TWMIX, Nasdaq: NDAQ, NYSE: PIZ, NYSE: PIE, NYSE: PDP, NYSE: DIA, NYSE: SPY, NYSE: NYX, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: IWM, NYSE: TWM, NYSE: IWD, NYSE: SDK, NYSE: ICE, Nasdaq: QQQQ, Nasdaq: HTOAX, Nasdaq: HTOTX, Nasdaq: HTOBX, Nasdaq: JTCIX, Nasdaq: JTCNX, Nasdaq: JTCAX.

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.

Short the S&P 500 Index in Early 2011

Who You Callin Short?

This Wall Street Greek author is now short the market, specifically the S&P 500. In my view, we have reached the tipping point in a rally that has lasted almost two years on borrowed money and borrowed time. Time is growing short and I am afraid smart money is about to do the same.

Relative Tickers: NYSE: GS, NYSE: C, NYSE: BAC, NYSE: WFC, NYSE: MS, NYSE: JPM, NYSE: TD, NYSE: PNC, Nasdaq: TROW, NYSE: STT, NYSE: STD, NYSE: DB, NYSE: BCS, NYSE: NBG, Nasdaq: MEMKX, Nasdaq: GECMX, Nasdaq: JEVOX, Nasdaq: PEMAX, NYSE: EEM, NYSE: VWO, Nasdaq: VEIEX, Nasdaq: ADRE, Nasdaq: PEBIX, Nasdaq: GMCEX, NYSE: MSF, NYSE: EEV, Nasdaq: REMGX, NYSE: GMM, NYSE: EDZ, AMEX: ETF, NYSE: FEO, NYSE: ESD, NYSE: MSD, NYSE: EMF, NYSE: TEI, Nasdaq: EMIF, NYSE: EFN, NYSE: EMT, NYSE: PCY, NYSE: PXH, NYSE: GMF, NYSE: GUR, NYSE: GML, NYSE: GMM, NYSE: EWX, NYSE: GAF, NYSE: EUF, NYSE: EET, Nasdaq: ABEMX, Nasdaq: AEMGX, Nasdaq: APERX, Nasdaq: PMGAX, Nasdaq: PMCIX, Nasdaq: AOTAX, Nasdaq: AOTCX, Nasdaq: AOTDX, Nasdaq: AEMPX, Nasdaq: AOTIX, Nasdaq: AEMEX, Nasdaq: AAMRX, Nasdaq: AEMFX, Nasdaq: AAEPX, Nasdaq: AEMMX, Nasdaq: ACKBX, Nasdaq: ACECX, Nasdaq: AMKIX, Nasdaq: TWMIX, Nasdaq: NDAQ, NYSE: PIZ, NYSE: PIE, NYSE: PDP, NYSE: DIA, NYSE: SPY, NYSE: NYX, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: IWM, NYSE: TWM, NYSE: IWD, NYSE: SDK, NYSE: ICE, Nasdaq: QQQQ, Nasdaq: HTOAX, Nasdaq: HTOTX, Nasdaq: HTOBX, Nasdaq: JTCIX, Nasdaq: JTCNX, Nasdaq: JTCAX.

Short the S&P 500 Index and the Market in Early 2011

In previous articles, I have recommended that readers take cash out of any long positions at key junctures. In each of these articles, I have presented a case that the technical formation in the market at that particular point in time represented the top of the bear market rally. As is always true with such technical indicators, even with the market in general, any bearish or bullish outlook always comes with associated statistical probabilities. So it is up to the reader to judge in accord with a recent WSG article whether I was "wrong or early?"

In this particular case, many technical indicators suggest that odds are high a decline is about to occur and that the current formation represents the top of the bear market rally:

• According to Elliot Wave (EW) theory, the current five wave structure, which is in turn a sub-structure of the final leg in the rally that began in March 2009, logically completes the retracement of bull market highs from 2007. Of course, the uncertainty with application of Elliot Wave is that many such structures are possible within the fractal wave patterns defined by EW rules. Since these patterns are completely recognizable only in retrospect, rules offer contingency outcomes if and when those rules are broken.


• This same five wave structure forms a classic "bearish rising wedge" on the S&P. A break below 1255 on the S&P Cash Index would suggest that prices are beginning to deteriorate, with a short-term technical target at around 1180.


• Any previous technical target associated with the bullish (inverse) head and shoulders which formed with the market bottom has been fully achieved.


• Index retracement is above the key Fibonacci level of 61.8% and is now at around two-thirds or 66.7% of the drop from bull market highs. Some view this level as technically important though it does not correspond to a Fibonacci ratio.


• Two key Phi Turn dates occur within a one week trading window: Dec 29th 2010 and Jan 6th 2011. Phi Turn dates are calculated using Fibonacci ratios applied to the time period between key market reversals. The calculated dates have proven very meaningful, often identifying market bottoms and tops to the day.


• Cyclic indicators, particularly the weekly stochastics indicator shows the market is overbought and topping.


• We now have a confirmed Hindenburg Omen, which suggests a very high probability of market decline. The first omen was observed on August 20th, 2010, with unofficial confirmation on Dec 14th and official confirmation on Dec 15th. The probability that a stock market crash occurs is higher than normal, and the probability of a severe decline is quite high. This Omen has appeared before all of the stock market crashes, or panic events, of the past 25 years - all of them. No panic selloff (greater than 15 percent) occurred over the past 25 years without the presence of a Hindenburg Omen.


• Most of this rally, particularly in the waning stages, has occurred on very light and decreasing volume, very likely supported by POMO operations. This leaves the market susceptible to flash crash conditions at any time.

As The Greek often points out, technical indicators should not be viewed outside of the context of underlying economic conditions, particularly when attempting to use these indicators to identify a reversal. In my estimation and based on my experience as a small business owner, the economic recovery is farcical and is not supportive of the capital investment necessary to restore real growth.

Despite suspect reports, unemployment remains up while banks are reluctant to invest in low yield US businesses. Instead, they continue to chase emerging markets with balance sheets repaired by taxpayer money, and in the process, are creating even more dangerous bubbles abroad. In my travels during 2010, I have found that even those people who are benefiting from the investments see the growth as unsustainable.

More importantly, we remain in the midst of a bond market bubble that dwarfs any other problem on the economic landscape. Any temptation to declare "mission accomplished" with the recovery would only increase headwinds in the form of inflation and higher interest rates. Any drop in the highly suspect dollar accomplishes the same. For this reason, I remain convinced that the Federal Reserve will be forced to keep interest rates low, not through QE3 and QE4, but through the deflation of higher risk assets. This will keep investors in the bond market for the foreseeable future, ensuring that bank balance sheets are protected from further, more devastating loss.

Disclosure:I am short S&P 500 Index Futures



Article may interest investors in NYSE: GS, NYSE: C, NYSE: BAC, NYSE: WFC, NYSE: MS, NYSE: JPM, NYSE: TD, NYSE: PNC, Nasdaq: TROW, NYSE: STT, NYSE: STD, NYSE: DB, NYSE: BCS, NYSE: NBG, Nasdaq: MEMKX, Nasdaq: GECMX, Nasdaq: JEVOX, Nasdaq: PEMAX, NYSE: EEM, NYSE: VWO, Nasdaq: VEIEX, Nasdaq: ADRE, Nasdaq: PEBIX, Nasdaq: GMCEX, NYSE: MSF, NYSE: EEV, Nasdaq: REMGX, NYSE: GMM, NYSE: EDZ, AMEX: ETF, NYSE: FEO, NYSE: ESD, NYSE: MSD, NYSE: EMF, NYSE: TEI, Nasdaq: EMIF, NYSE: EFN, NYSE: EMT, NYSE: PCY, NYSE: PXH, NYSE: GMF, NYSE: GUR, NYSE: GML, NYSE: GMM, NYSE: EWX, NYSE: GAF, NYSE: EUF, NYSE: EET, Nasdaq: ABEMX, Nasdaq: AEMGX, Nasdaq: APERX, Nasdaq: PMGAX, Nasdaq: PMCIX, Nasdaq: AOTAX, Nasdaq: AOTCX, Nasdaq: AOTDX, Nasdaq: AEMPX, Nasdaq: AOTIX, Nasdaq: AEMEX, Nasdaq: AAMRX, Nasdaq: AEMFX, Nasdaq: AAEPX, Nasdaq: AEMMX, Nasdaq: ACKBX, Nasdaq: ACECX, Nasdaq: AMKIX, Nasdaq: TWMIX, Nasdaq: NDAQ, NYSE: PIZ, NYSE: PIE, NYSE: PDP, NYSE: DIA, NYSE: SPY, NYSE: NYX, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: IWM, NYSE: TWM, NYSE: IWD, NYSE: SDK, NYSE: ICE, Nasdaq: QQQQ, Nasdaq: HTOAX, Nasdaq: HTOTX, Nasdaq: HTOBX, Nasdaq: JTCIX, Nasdaq: JTCNX, Nasdaq: JTCAX.

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.

Misunderstood Same-Store Sales Surge Offers Opportunity for Short Investors

Oversight Misled Retail Stocks Tuesday

An important calendar difference was missed by major media and expert analysts alike Tuesday. The oversight, and the later promotion of the wrong message by pundits, looks to have inflated same-store sales growth and provided a special opportunity for short investors over the near-term, especially in retail industry stocks.

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.

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A Misunderstood Same-Store Sales Surge Offers Opportunity for Retail Stock Shorts

Loyal Wall Street Greek readers have gotten used to our regular debunking and uncovering of anomalies behind what can appear as strong economic data. Once again Tuesday, we uncovered an important and deflating detail that was overlooked and left out by every major business media outlet and even Wall Street's most respected retail sector stock analysts. This is a reminder of why you read the expert authored blog, Wall Street Greek.

When the International Council of Shopping Centers (ICSC) reported same-store sales Tuesday at a level that marked the best growth for the entire holiday shopping season, economists, strategists, analysts and portfolio managers alike got on television and radio and proclaimed the American consumer alive and well. Indeed, even I was left scratching my head, wondering why… for a second or two. After all, for the period ended December 18, same-store sales marked 1.7% growth, week-over-week, and 4.2% growth against the prior year comparable period. Redbook concurred, showing 3.8% year-to-year growth for the same period. The S&P Retail SPDR (NYSE: XRT) was up fractionally on the day, but Macy's (NYSE: M) moved 1.5% higher, while Target (NYSE: TGT) jumped 1.9% and Nordstrom (NYSE: JWN) gained 1.2%.

After researching the subject, I almost bought into the conclusion offered by some high-level industry folks. The big idea was that shoppers came out in force last week, packing in a good portion of their shopping during the period. The ICSC Index and report released Tuesday seemed to concur with this assumption, given that it showed 74% of consumers had finished their holiday shopping through December 18, which was up from 56.6% the week earlier. That surge in shopping activity could be behind some of the week's extraordinary growth. According to a Bloomberg article on the subject, Oppenheimer Analyst, Brian Nagle, seemed to agree. However, based on one important fact that most if not all of Wall Street and the business press missed, we have to disagree.

What Had Happened...

What the pundits and speak-easies missed was an important calendar difference between 2009 and 2010. Bloomberg Radio Host Kathleen Hays almost stumbled upon it when she asked an expert guest if the reason might be seasonal. He quickly and sternly stamped out that truth, saying it couldn't be seasonal, given that the growth was measured on a year-to-year basis. WRONG!!! Wrong! Wrong! Wrong! And shame on you Mr. Expert for leading Bloomberg's audience in the wrong direction by sounding like you knew what you were talking about. Kathleen, "The Greek" should have been your guest Tuesday. I know from my experience as an analyst, and from the advice given to analysts by a seasoned talking head back at my old firm, that it is widely believed that giving any answer to a television or radio interviewer is better than giving no answer. Wrong and unethical! Thus, many of the talking heads you see on TV answer confidently, when sometimes they are just regurgitating what they have read or heard somewhere else, or they are simply spewing out their best guess. In other words, sometimes the well articulated and seemingly sound advice of experts is completely baseless and hazardous for investors to buy into.

Super Saturday is the second most important shopping day of the year after Black Friday, with Cyber Monday and Christmas Eve likely on their heels. Super Saturday is the Saturday immediately preceding Christmas, but it does not always fall on the same calendar date each year, and this year a slight differential misled the entire market.

Christmas falls on Saturday this year, but it fell on Friday in 2009. Thus, Super Saturday fell on December 18th this year, and was measured in the latest week's same-store sales. However, last year, Super Saturday fell on December 19th, and so it was absent from this latest prior year comparable that the 4.2% growth climbed over; its impact will instead be seen in next week's report. Therefore, next week's same-store sales growth result has a good chance of falling short of expectations and disappointing investors, if our analysis does not restore market efficiency sooner than that. Given this week's message, or false message, investors who might have been misled into buying retail stocks Tuesday could regret their action shortly on market correction.

Other data and expert analysis seem to point toward trouble for the whole of the holiday shopping period. The National Retail Federation Survey released in the middle of the month noted that 62% of adults surveyed said they would spend the same amount of money or more this year than in 2009. This fact also seemed to enthuse a few fools Tuesday, especially while complementing the 4.2% inflated period growth. However, those of us who have a bit of math proficiency remind readers that if this is true, then 38% of shoppers will be spending less this year. That second bit of information, characterizing a large number of people who usually spend about the same amount every year, likely plays more importantly for retail revenues and profits… but not for headlines.

Retail guru, Jay Margolis, pointed out that consumers were following deals this year, and staying home if there were none. He noted desperate retailers' broad store-wide discounting late in the season but well ahead of Christmas, as shop managers seek to ensure the movement of inventory. Otherwise, retailers would be faced with excess, and need to discount even further post Christmas. This is a bad sign, and it means shop-keeps will be turning inventory, but at a lower ticket. That little ditty should keep revenues soft and profit margins tight come quarter end. Therefore, assuming the week's 4.2% growth doesn't coincidentally correlate with the direction and state of the sales season, then this potentially mistaken surge in retail shares could offer opportunity for short investors of retail sector stocks.



This article should prove interesting to investors in NYSE: PIR, NYSE: ETH, Nasdaq: HOFT, NYSE: HD, NYSE: LOW, Nasdaq: AAPL, NYSE: BBY, NYSE: LTD, NYSE: CHS, NYSE: ANN, NYSE: GPS, NYSE: M, NYSE: JCP, NYSE: JWN, NYSE: TJX, NYSE: KSS, Nasdaq: COST, NYSE: TGT, NYSE: WMT, Nasdaq: WTSLA, Nasdaq: HOTT, NYSE: AEO, NYSE: ARO, NYSE: ANF, NYSE: SAK, NYSE: TIF, NYSE: TLB, NYSE: LL, Nasdaq: BLDR, NYSE: FO, NYSE: LEG, NYSE: TPX, NYSE: AYI, NYSE: LZB, Nasdaq: SCSS, NYSE: ZZ, NYSE: FBN, NYSE: NTZ, Nasdaq: SHLD, NYSE: DDS, Nasdaq: BONT, Nasdaq: CPWM, Nasdaq: BKRS, Nasdaq: BEBE, NYSE: BKE, Nasdaq: CACH, Nasdaq: CMRG, Nasdaq: CATO, NYSE: CBK, Nasdaq: CTRN, NYSE: PSS, Nasdaq: DEST, Nasdaq: DBRN, NYSE: DSW, Nasdaq: FINL, NYSE: FL, Nasdaq: GYMB, NYSE: GES, NYSE: JCG, NYSE: JNY, Nasdaq: JOSB, NYSE: NWY, NYSE: JWN, NYSE: MW, Nasdaq: SYMS, Nasdaq: PLCE, NYSE: BAC, NYSE: JPM, NYSE: GS, NYSE: MS, NYSE: C, NYSE: PNC, NYSE: WFC.

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.