Trucharts.com - Weekly Blog ending 03/13/15 - Good reads and Hot Stocks to watch
Sorry for the late posting - had some family obligations to tend to.
What an amazing week in the markets - very volatile moves up and down - sounds like a roller coaster to me. We stated in our previous blog that the range would be between 2080 and 2050 for the SP500 and that is what we saw this past week. The markets rallied today and the resistance in the SP500 was expected to be 2080 and the DOW resistance around 18000 which is right at the 13d moving average. We will have to wait and see if the markets can break above this range now or will it consolidate or see a breakdown.
With the BIGGEST news this week expected to be the Fed view on future interest rates - this is expected on Wednesday - economists are split evenly on what the Fed will do and we think that the Fed will stay put on rates till Fall or September knowing that the inflation pressures are muted due to the fall in oil prices. With the strong dollar and negative rates in the Eurozone, we do not see how the Fed will move to raise rates - the only concern on the Fed's mind will be asset bubbles in real estate and stocks.
Here are some very good articles and reads for Fed interest rates:
Markets rallied today due to the USD pulling back from an extended move up - but we still like the USD - euro is headed lower and we think this may be a short term pullback into a bullish move in the USD. Again, we would expect to see a move after the Fed's comment on Wednesday on interest rates.
Let us take a look at some of the commodities - oil hit a new low today and is heading to our target price of $40 - the oil stocks bounced today - maybe a sign of some bottom in the oil sector - especially knowing that we are heading into the summer season. Keep an eye on the oil sector stocks.
We are long USO and short the calls against our position.
Gold is languishing here pending the Fed's view on rates and is still looking weak. Wait and watch.
We are short AEM (www.trucharts.com/stockview.aspx?TICK=AEM).
We have been watching the Utilities sector stocks (XLU - ETF) as this sector has corrected over 20% due to the move up in yields and move down in bonds, and the move up in USD. We discussed this sector over the weekend in our meetup and pointed to stocks as (www.trucharts.com/stockview.aspx?TICK=SO), and (www.trucharts.com/stockview.aspx?TICK=PCG) - these moved up over 2% today. XLU is looking strong at the close of markets today.
We went long SO today and are long BIDU, USO, TWTR, BOX, Z, ANGI and LLY. We are short UAL. Looking to go long AMGN.
The pharmaceutical sector - especially the BIOTECH sector took off again today - due to news from AMGN and Sanofi on the cholesterol drug findings - http://www.marketwatch.com/story/amgen-other-drug-company-shares-jump-on-cholesterol-drug-findings-2015-03-16?siteid=yhoof2. AMGN closed strong today and we like the stock. BMY broke out and LLY is also looking strong. Here are the charts:
The tech sector looks interesting - we are very concerned after the INTC (www.trucharts.com/stockview.aspx?TICK=INTC) news of a lower revenue forecast.
We expect that MSFT will also be impacted by this news as will the component suppliers to the the PC sector. There are some stocks that look very extended - NXPI, AVGO and SWKS.
Here are some other articles for reading:
Good luck trading.
Trucharts team
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