Pre-opening Comments for Wednesday April 25th
U.S equity index futures are higher this morning. S&P 500 Index futures gained 9 points in pre-opening trade. Index futures responded mainly to Apple’s higher than expected fiscal second quarter earnings report.
March Durable Goods Orders released at 8:30 AM EDT were less than expected. Consensus was a decline of 1.9% from February. Actual was a decline of 4.2%. Excluding transportation, consensus was a decline of 0.5%. Actual was a decline of 1.1%.
The United Kingdom economy officially entered into a recession after first quarter GDP was reported as a 0.2% annualized deficit.
First quarter earnings reports continue to pour in. Companies reporting overnight included Apple, Norfolk Southern, Amgen, Aflac, Nabors, Northrop, Sprint Nextel, Harley Davidson, Wyndham, Eli Lilly, Wellpoint, Encana, Caterpillar, US Airways, Southern Companies, Hess, Corning and Boeing.
Canadian National Railway is expected to open higher after Raymond James upgraded the stock from Market Perform to Outperform.
US Steel added $0.45 to $28.10 after Macquarie upgraded the stock from Under Perform to Neutral. Target price was raised from $25 to $29.
JC Penney added $0.43 to $34.24 after BMO Capital upgraded the stock from Under Perform to Market Perform. Target was raised from $29 to $35.
Apple gained $55.22 to $615.50 after reporting higher than consensus second quarter results. In addition, Scotia Capital upgraded the stock from Sector Perform to Outperform and raised its target from $656 to $843.
United Technologies added $0.37 to $80.25 after Argus upgraded the stock from Hold to Buy. Target is $95.
Wal-Mart and McDonald’s could open lower after Argus downgraded them from Buy to Hold.
Apple, Inc (NASDAQ:AAPL) – $615.50 jumped 9.9% after reporting blow out fiscal second quarter results. The stock has a positive but deteriorating technical profile. The stock has a positive, but deteriorating technical profile. Intermediate trend is up. Resistance has formed at its all-time high at $644.00. The stock trades well above its 200 day moving average and is expected to open above its 20 and 50 day moving averages. Short term momentum indicators are overbought and set to recover this morning. However, strength relative to the S&P 500 Index turned negative early in April and seasonal influences turn negative at the end of April. Preferred strategy is to take profits on strength closer to the stock’s all-time high.
Apple Inc. (NASDAQ:AAPL) Seasonal Chart
Boeing Co. (NYSE:BA) –$75.00 added 2.5% after reporting higher that consensus first quarter results. The stock has a mixed technical profile. Intermediate trend is down. Resistance is at $75.81 and $76.64. The stock trades above its 200 day moving average and is expected to open above its 20 and 50 day moving averages at the opening. Short term momentum indicators are trending higher, but are overbought. Strength relative to the S&P 500 Index has been negative since mid-December. Seasonal influences currently are positive. Preferred strategy is to take profits closer to resistance at $76.64.
The Boeing Company (NYSE:BA) Seasonal Chart
Caterpillar, Inc. (NYSE: CAT) – $107.20 fell 1.1% despite reporting higher than consensus first quarter earnings. The company also lowered its second quarter guidance. The stock has a negative technical profile. Intermediate trend is down. Resistance is at $113.77 and $116.46. The stock trades above its 20 and 200 day moving averages, but found short term resistance at its 50 day moving average at $109.36. Short term momentum indicators are overbought and starting to roll over. Strength relative to the S&P 500 Index has been negative since mid-December. Seasonal influences currently are positive. Preferred strategy is to take profits on strength closer to resistance at $113.17.
Caterpillar Inc. (NYSE:CAT) Seasonal Chart
Responses to first quarter earnings report were substantial yesterday. Generally, companies that report significantly higher than consensus results saw their share prices move sharply higher (e.g. Apple after the close, Hersey, Baker Hughes, Illinois Tool Works, AT&T, MMM) and companies that reported less than consensus, in line or slightly higher than consensus results (e.g. Texas Instruments, Netflix, Big Lots, McGraw Hill, Air Products and Chemicals, US Steel, AK Steel, Zion Bancorp) saw their share prices move sharply lower.
Adrienne Toghraie’s “Trader’s Coach” Column
What Are You Worth?
By Adrienne Toghraie, Trader’s Success Coach
Did you ever ask yourself what you feel you are worth in trading?
A good way to evaluate what you are worth is to compare yourself with others who have worked to be successful traders.
· Have you gained resources from the past that will help you become a trader?
· Do you have enough capital for your trading business and for your trading account?
· How many books have you read?
· How many seminars have you taken?
· Do you have a mentor and or coach?
· Have you put together a trader’s business plan?
· Do you have a tested strategy?
· Have you been consistently earning money?
· Have you handled your self-sabotage issues that keep you from your full potential?
Now let’s evaluate the time that you have put into becoming a trader.
· All toll, how much time did it take for you to become a trader?
· How much of that time was wasted because of bad choices?
· How much of that time were you undisciplined and not consistent?
Now let us look at other professions that could bring in a large return.
· How long does it take to become a doctor, lawyer or any other white-collar profession?
· How long does it take to become a recognized artist or professional athlete?
· How long has it taken others in trading to reach the top of their profession?
Based upon your answers, how much do you feel you should be earning from trading at your stage of development?
Most of the top traders that I know, if they have made good choices, take at least three years of earning a profit in trading before they are ready for becoming a top trader. And, this is only if they have the money, time, strategy and have overcome their self-imposed limitations. Trading is an exceptional business, but it is not for someone who thinks that they are going to earn top profits without smart decisions on how they use their resources.
The misguided trader
Ray was like so many traders I have met over the years who thought they could become an instant success in trading. I first met Ray at a Trader’s Expo when he laughed at the sign in my booth, “Discipline Problems – Stop Here.” He said like many who have passed my booth that he wanted to send me his children. Ray then asked me who I thought were the best teachers to get him to the top quickly, because he wanted to give up his profession as a doctor.
The next year, Ray showed up again at the Expo and said that he should have followed my advice, because he lost over $50K dollars and was no closer to giving up being a doctor. This time he came to my lecture and was willing to follow my advice about who to work with. The only problem is that he also decided to work with several other teachers as well and read about many different types of trading strategies.
Ray came to my booth the third year and said that he was now down over $200K dollars. What he was trying to do by incorporating so much advice was to filter out any possibility for losses. In doing this, he confused himself. He said to me that with all he had invested in time, money and aggravation he should be at the top of the trading profession.
What do you think Ray is going to report to me next time I see him at the Expo?
Just because you have the passion and put time, money and energy into trading does not mean that you deserve to earn a high reward for your efforts. It takes using those resources wisely to earn the top that the profession offers.
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Canfor Corporation (TSE:CFP) Seasonal Chart
Interesting Globe and Mail Comment on Ontario taxing the rich
Tim Cestnick offers some interesting observations
The connection between copper and equity markets
GlobeandMail.com headline reads, “Copper market signals a nasty outlook for equities”. Following it the link:
Disclaimer: Comments and opinions offered in this report at www.timingthemarket.ca are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered in this report is believed to be accurate, but is not guaranteed.
Don and Jon Vialoux are research analysts for Horizons Investment Management Inc. All of the views expressed herein are the personal views of the authors and are not necessarily the views of Horizons Investment Management Inc., although any of the recommendations found herein may be reflected in positions or transactions in the various client portfolios managed by Horizons Investment Management Inc
Horizons Seasonal Rotation ETF HAC April 24th 2012