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Ebook Version of Strategic Stock Trading Hits Top 100 Kindle List - Mike Swanson (05/30/12)

Mike Swanson — Wed, 30 May 2012 15:22:58 +0000

A few days ago I did a promotion with Amazon.com to make the ebook version of my book Strategic Stock Trading free through Amazon.com until today at midnight. This morning the book hit the top 100 list of all free ebooks on Amazon.com.

It's a pretty amazing and humble thing for me to see this happen.

The free offer will be gone tonight at midnight EST. At that time Amazon.com will take it down.

If you don't already have it to get the book go here.

When I first released this book I put out this video about it:

To get the book go here.

for more:

Gold Stocks Market Vectors Miners ETF (NYSE: GDX) Provide Market Timing Signals - Mike Swanson (05/30/12)

My Big Picture View of the Stock Market and Game Plan - Mike Swanson (05/29/12)

Lessons and Opportunities from the Facebook (NASDAQ: FB) IPO Stock Disaster - Mike Swanson (05/27/12)

Podcast: Jeff Pierce Gives His Update on Bonds and Warns About Further Selling in the Nasdaq to Come - Mike Swanson (05/23/12)

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Topics:

Stock Market News

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Stock Market Commentary

Gold Stocks Market Vectors Miners ETF (NYSE: GDX) Provide Market Timing Signals - Mike Swanson (05/30/12)

Mike Swanson — Wed, 30 May 2012 10:24:59 +0000

Yesterday gold and gold stocks were down even though the stock market was up. Some people were wondering what is up with that? There has been an assumption among many that the stock market correction that began over a month ago has been overdone and the market should just go up. Those people are ignoring the seriousness of the Greece debt situation and the potential of the European debt crisis to spread to Italy, Portugal, or Spain. This crisis has been going on now for over two years and in my view is now reaching its climatic stage, which will bring a violent correction in the market and a huge buying opportunity for those that take advantage of it.

But what of gold?

Long-term I think metals and mining stocks are great investments. I think once the correction is over they will likely lead the markets for the next few years.

But gold and gold stocks have been in a decline since last September. Yes they have had a big bounce lately, but they dropped again yesterday.

The reality is both have tended to lead the stock market. So their weakness for months has preceded the current market correction. On a short-term basis they have done the same thing in the past few weeks. We've seen a bounce in the broad market, but gold stocks actually started to firm up before that bounce began. Now yesterday they turned down even though the S&P 500 went up. They probably were showing that the bounce in the stock market is about done.

You can see this in the 60 minute chart of the gold stock Market Vectors Miners ETF (NYSE: GDX) above. Notice how it bottomed out three days before the S&P 500 did and actually started to rally two trading days before the broad market did too. It led the market up. Now its getting weaker than the market again though and probably will lead it down.

I believe this correction is going to last at least another few weeks, but the action in gold stocks compared to the rest of the market will be something you should keep an eye on, because as the correction nears its end I expect we'll see gold stocks start to fall less than the broad market does on a percentage basis and actually hold up at the end of the correction. Gold stocks will try to make a double bottom here.

That will make for a good sign of a stock market bottom when combined with other factors such as a spike in the VIX, panic selling, and simple fear.

Oh, and I can't help but mention to you Facebook closed below $29 yesterday. Don't touch this radioactive stock!

for more:

My Big Picture View of the Stock Market and Game Plan - Mike Swanson (05/29/12)

Lessons and Opportunities from the Facebook (NASDAQ: FB) IPO Stock Disaster - Mike Swanson (05/27/12)

Podcast: Jeff Pierce Gives His Update on Bonds and Warns About Further Selling in the Nasdaq to Come - Mike Swanson (05/23/12)

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

My Big Picture View of the Stock Market and Game Plan - Mike Swanson (05/29/12)

Mike Swanson — Tue, 29 May 2012 10:54:34 +0000

Topics:

Stock Trading Strategies

WSW Articles:

Stock Market Commentary

US Shines in a Dark Economic Sky - Tim Bellamy (05/28/12)

Tim Bellamy — Mon, 28 May 2012 10:38:59 +0000

European and Asian economic data is weakening, but after a three week losing streak which has seen the Dow Jones Industrials slip by 6.5% firmer US economic data helped the ship steady this week, with the Dow posting a o.7% advance.
With Greece looking ever more likely to leave the Eurozone and default on its debts, the G8 meeting was hijacked by attempts to address these concerns. Unsurprisingly, the meeting came up with little more than a tacit agreement to do all in the group’s power to support Europe and the wider economy.

Through the week, economic data from Europe indicated that its recession is worsening. German business confidence has fallen by three points in May, worse than forecast, and the Eurozone PMI reading came in at 45.9, the fourth month in a row that it has dropped. Spanish bond yields remain at critical levels, and UK figures on its economy showed that its recession is far deeper than first shown by figures released last month.

In Asia, HSBC’s latest reading of the PMI fell for the seventh consecutive month. Combined with the decline of bank lending – 33% lower in April from March – this shows the slowdown in China is gathering pace. Over in Japan, debt levels are beginning to cause the level of concern recently reserved for Europe. Fitch, the ratings agency, has downgraded the country’s sovereign debt rating to A+, citing the budget deficit of 240% of GDP forecast for the end of this year. On top of this, its trade deficit widened to over $6.5 billion in April, and inflation is edging up.

The United States is definitely bucking the global trend at present, and US consumer confidence, helped by an oil price that has declined by 13% in just a few short weeks, is now at its highest level since 2007. New home sales numbers, up 9.9% in a year, show that the housing market is finally turning positive, and existing home prices are up by 10% year on year. Jobless claims, however, are proving stubbornly resistant, with the four-week average falling by just 5,000 to 370,000.

The economic up swing here in the United States is showing itself in banking profits, with quarterly earnings up by 23% and the best since mid 2007. This is rubbing off on Canadian banks, where three of its five big banks have reported large increases in profit due to the success of their US operations.

Hewlett Packard (NYSE: HPQ) confirmed that it will be cutting around 27,000 jobs over the next two years as it struggles with declining revenues and falling earnings. Dell (NASDAQ: DELL) nearly matched Hewlett’s poor showing. With earnings declining by 27% in its first quarter, it said that it is seeing a reticence from businesses to spend on pc’s and sales are being cut into by competition from tablets.

Facebook (NASDAQ: FB) has had a terrible debut. Its shares have slipped from an offer price of $38 to stand around $32, and regulatory bodies have raised concerns. Several law firms are bringing class action lawsuits against advisors and brokers, after it emerged that information about declining revenues and a cut in estimates was withheld prior to the first day of dealings last week.

The Dow Jones Industrials added 85.55 points, or 0.7% to close the week at 12,454.83, and the S&P 500 rose by 1.7% to 1317.82. The Nasdaq 100 bounced from last week’s massive losses, adding 1.96% at 2527.05.

This Week’s Economic Releases

Monday 28th May

Unemployment and retail sales number from Japan. German CPI. United States Holiday.

Tuesday 29th May

Retail sales numbers from Australia.

Wednesday 30th May
Italy conducts a 10-year bond auction, and the Eurozone releases sentiment results for May.

Thursday 31s May

German unemployment numbers, and French consumer spending dominate European releases, while the initial jobless claims in the United States are likely to be static. US GDP estimates for the first quarter will be revised.

Friday 1st June

India releases its trade balance, whilst a raft of European data is topped by the Eurozone’s unemployment numbers. In the United States, the ISM manufacturing Index will be watched for further signs of economic growth.

This Week’s Major Company Results Due:

None Known.

for more:

Lessons and Opportunities from the Facebook (NASDAQ: FB) IPO Stock Disaster - Mike Swanson (05/27/12)

http://wallstreetwindow.com/node/6048>Why Facebook (NASDAQ: FB) Shares Are Radioactive - Mike Swanson (05/23/12)

Podcast: Jeff Pierce Gives His Update on Bonds and Warns About Further Selling in the Nasdaq to Come - Mike Swanson (05/23/12)

Podcast: David Bannister of ActiveTradingPartners.com Sees These Next Few Days As Critical for a Potential Trend Reversal - Mike Swanson (05/21/12)

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Lessons and Opportunities from the Facebook (NASDAQ: FB) IPO Stock Disaster - Mike Swanson (05/27/12)

Mike Swanson — Sun, 27 May 2012 10:59:13 +0000

I got a free surprise for you at the end of this post.

Two big things have been happening over the past month. We've seen the Facebook IPO disaster and suffered through a pretty tough stock market correction. There are lessons to be had from both of these events and huge opportunities to actually profit from them.

Right before the Facebook IPO I received several dozen emails from people asking if they should buy into it or consider buying other "social networking" stocks to buy. In my private answers I said no. But I felt compelled to give a public warning too. So I made a post before it opened telling you and the whole world to stay away from it. Of course once it started to trade and turned into a broken dud IPO this opinion became common place all over the Internet and I added my two cents to the conversation in a follow up "post in which I explained how ridiculously overvalued the stock is from an investment standpoint and how it is really worth around $18 a share.

The stock is trying to build support at $31 a share. But if it closes below that I can easily see it fall to $20 or even my $18 target over a month or two. It's a mess.

People have already started to play the blame game. But as Bradley Willett who runs the website www.fallstreet.com notes, "there is a budding theory that individual investors got suckered with FB – that they were somehow victimized by a Wall Street machine able to hypnotize them into handing over their hard earned dollars. Rather than lend much credence to this utter nonsense let me plainly say that if anyone wanted to buy Facebook and they didn’t have a clue about the company’s book value and/or some of the more basic valuation matrixes (i.e. forward P/E multiples, everything cash-flow related, etc) they are not ‘investors’. To be sure, buying stocks is not something that should be undertaken by someone that doesn’t have a basic understanding of corporate worth. Feeling sorry for someone that bought the insanely priced Facebook IPO is like going to the casino and patting the player that splits 10s on the back."

There is a big lesson to what Willett is saying here that I'm going to follow up on with you in a second. But first I want to say that as far as an investment standpoint goes even if Facebook were to fall to $18 a share of $10 a share I still do not think it would be a good investment. I talked with a friend of mine who reads my work on the phone the other day that is hooked into the Internet marketing world and consults with online businesses around the world and realized that Facebook isn't really a great business when it comes to making money.

He told me that according to Facebook's corporate website "Facebook's mission is to give people the power to share and make the world more open and connected." Well it has succeed in accomplishing that mission - and in doing so it has also demonstrated that this mission does not result in the creation of a massive money making operation. Facebook has proven itself to not be a great medium for advertisers. The problem is they charge advertisers to create "fan pages" by having them pay to put ads on their site to "like" pages. From a business standpoint though this doesn't really result in meaningful revenue results for the advertisers. Facebook is not like TV. Big companies like GM have pulled their Facebook ads off the site after experimenting with them for a year.

The problem is if you are a company it doesn't really mean much if some dude on Facebook likes you "fan page." I advertise on the Internet for this website and run banner ads. I've even done a little advertising on Facebook to bring traffic to this website. But the idea of paying Facebook money to send traffic to a "fan page" on Facebook to me is a stupid waste of money. Why should I pay Facebook to have its own users click some page on its site? I rather pay Facebook to send traffic to my own website. And on those counts I have found that when you pay Facebook to do this you end up spaying twice as much and getting half the clicks per banner impression than you do elsewhere on the Internet. And studies show this is the typical result all advertisers have on Facebook.

So as an advertising medium Facebook itself sucks.

What is even worse for Facebook though is that some studies also suggest that Internet advertising as a whole is losing effectiveness and getting cheaper. That means even less money for Facebook in the long run. Put it all together it's no surprise that Facebook saw its earnings shrink by 12% in the last quarter.

Like my friend said Facebook has succeed in achieving its mission statement, but where does it go from here? Now that it is a public company the street will demand that it make more money. Facebook will be under pressure to find new ways to grow earnings. The danger is that in doing so it may actually detract from its success in achieving its mission statement.

It's a paradox. Facebook has succeeded in its objectives, but those objectives do not create a wonder company when it comes to profits. Now to try to become one I fear will result in it mucking itself up and eventually alienating its users. This is heresy to Facebook fanboys, but Facebook is just another website and websites rise and fall in terms of popularity. Ten years ago neopets.com, excite.com, aol.com, and go.com were among the top 20 websites in terms of traffic. Now neopets.com and excite.com have fallen into the top 4,000+ and go.com is barely functional. Aol.com was once one of the biggest sites on the Internet, but now maintains its traffic by having interests in hundreds of other high traffic sites and itself fluctuates in the top 50-100 of sites.

It is one thing to trade a stock, but another thing to invest in a company for the long run. Facebook just doesn't make sense to me for an investment. It's an Internet fad.

And now for the hard lesson to take away from Facebook - a lot of people, like Willett said, simply bought Facebook without doing any home work at all. They didn't look at the valuation of the stock or study it from a business and earnings standpoint. They just saw all of the media hype and became afraid of missing out on it. They knew a lot of people were buying it and other Internet stocks like Google have done well over the years and were more afraid of missing out on potential Facebook gains than buying and losing money. They put no real study or thought into what they were doing.

People who do no homework when it comes to investing end up losing money.

Statistics show that only 25% of the people who buy stocks beat the market and only 5% make life changing returns. That sounds like bad odds, but the good news is that the reason why these figures are the way they are is because 75% of the people don't know what they are doing and don't spend anytime thinking about what they are doing. They literally throw money at the market. When you enter the stock market arena that is what you are competing against.

There is a huge opportunity coming in the stock market right now. And I mean it. Last summer in my monthly newsletter I said I was pretty much out of the market and thought it would be dead for sometime and tough to make money in. I had even taken most of my money out of my account and invested it in some real life brick and mortal business I'm involved in. Now I think some big opportunities are on the horizon to make money in the market. Now I've been taking money out of some of my other business and real estate investments and putting it back into my brokerage account to get ready.

First there is the Greece default, which in my view will provide a great opportunity to buy stocks in Greece that are trading at less than breakup value. That is the kind of investing John Templeton and Warren Buffett used to do - buy stocks at super cheap valuations that have stable and good business models - and pay beefy dividends.

Then we have a market correction that will provide a great opportunity to buy into sectors that are holding up and poised to outperform the rest of the market on the next rally. Gold is one of those sectors, but there are a few more worth watching.

I think the correction is likely to continue for at least several more weeks, but those that know how to take advantage of it and buy the right stocks will make a killing. Now is the time to get ready and pay attention to the market. I haven't been as excited about the market now as I have been in several years.

I am going to help you take advantage of the opportunities to come.

Two years ago I published a book titled Strategic Stock Trading that spent a week as one of the top 100 best selling books on Amazon. Tony Blair published a book the same week that was being pushed all over TV land and there were days in which my book was outselling his on Amazon.com. It has tons of great reviews and still sells lots of copies every month.

I have just put an electronic ebook version of the book up on Amazon for sale. From now till midnight Wednesday though you can download this book for free by clicking here.

I just want to give the book to you. If you already got the physical copy you might want a complimentary free version for your ipad, kindle, or just to look at on your computer. Or you may want to tell friends about it.

If you never have read the book before now is the time to read it. It won't take you long. It's just over 100 pages and it details my strategy for buying stocks and investing in them - especially identifying the best sectors and stocks to buy into after big market corrections like we are going through right now. So it's the perfect first step preparation for this market. My goal in writing it was make it the best one hour of educational reading on the stock market possible. I really can't give away the physical version like this, because it wouldn't be fair to the people who bought it and frankly I don't want to pay to mail off thousands of free physical books to people, but this I can do this one time for you.

To grab the book click here.

Secondly, I'm going to put out a series of videos on what is going on in the market and how to take advantage of things over the next few weeks. I should have the first one ready for you by Tuesday so look out for it. I plan on giving you a big overview of how I think things will play out in it.

Today you can get ready by getting my book free by downloading it right now before Wednesday. Just click here.

Topics:

Stock Market News

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Stock Market Commentary

Why Facebook (NASDAQ: FB) Shares Are Radioactive - Mike Swanson (05/23/12)

Mike Swanson — Thu, 24 May 2012 11:00:59 +0000

What we are seeing in Facebook is one of the craziest things I've ever seen in the stock market, and I've seen a lot of crazy things over the years. Right now the company is engulfed in controversy and people are filing lawsuits only days after it went public and started to trade on the Nasdaq last Friday.

Right now there is a lot of anger and hand ringing over why the stock has dropped. It is almost as if people think the stock was supposed to go up and since it didn't someone has to blame. Many people bought the IPO, but it seems that very few people want to admit to themselves the truth - which is that they bought shares of Facebook at a stupid price and that is why there are losing money - and instead simply want to blame others for their mistakes. People who hire lawyers because they bought a stock and lost money are usually losers in life. When you have a setback you need to move on and find the next big thing that can make you money and not wallow in misery.

Where is Facebook going now?

Before I get to that though just remember what it was like a week ago when Facebook started to trade and the media acted as cheerleaders for the stock.

It is funny how the very reporters that were acting giddy over Facebook are now slamming the company.

It is funny how little rational analysis they provided their viewers.

There are a couple things I want to add to the Facebook conversation to try to set things straight.

1)First of all the stock was priced by its underwriter Morgan Stanley and Facebook management, which ultimately is this Zuckerberg character, at an insane valuation. Even though the stock has since dropped it is still trading at a nosebleed valuation. Facebook has a P/E right now of 73.90 and a forward P/E of 48.48. In comparison Google has a P/E of 18.47 and a forward P/E of 12. So to purchase an investment in Facebook's earnings requires you to pay four times what you would for Google.

Now that would be ok if Facebook's earnings were set to just grow exponentially in the next few years. But they aren't. In fact in this last quarter Facebook's earnings were down 12% from the same quarter last year.

Facebook has a PEG ratio of 1.66. Stocks are considered to be fully valued when PEG ratios are around one and I look to buy stocks with PEG ratios of 0.50 or even lower to insure that I am getting a good bargain on a stock when I plan to make a serious investment. Google's PEG ratio is .78. I bring that up to show you not that I think you should go buy Google, but to demonstrate to you how sky high Facebook's valuation is even now.

Based on fundamentals Facebook shares are fully valued at 18 a share.

That is my price target for Facebook.

2)Now when companies do an IPO normally it is hard to get shares. Floats are small. The people running the company don't want to dilute themselves or their other shareholders too much so they don't try to sell stock to everyone in the world. They want there to be people who couldn't get shares or just got a few who will be hungry to buy once the stock starts to trade on the exchange. That way there will be healthy trading demand for the stock and it will go up.

With Facebook they sold millions of shares - as many as they could apparently- before it started trading at insane valuation levels. I logged into my mom's Etrade account a few days before the IPO day and I could have bought her shares if I had wanted to. And she has a small account that doesn't engage in much trading. She isn't like an important customer for Etrade. I didn't buy shares.

So anyone who wanted to was pretty much already in Facebook before it started to trade on Friday while a lot of insiders were getting ready to sell.

Zuckerberg sold over a billion dollars worth of his stock during the IPO. He knew it was a great place to dump and so he did. But who was there to buy once it started to trade? He ran out of suckers so the stock dropped.

You had a situation doomed for disaster.

3)The very fact that the Facebook company sold this many shares to the public at stupid prices means that they were in effect taking advantage of the public and fleecing them. They were not treating the people who were investing in the company as valued partners, but as people to be screwed over. Well if you have seen the movie about Facebook or read about the history of the company you'll know that in fact that is how it started. It's early history consisted of lawsuits between Zuckerberg and people he founded the company with and others that thought he ripped them off.

If you start a business and get people to invest in it you want them to make money. That way they will want to get involved with you in future deals and so will others. Business is about your reputation. It's also human nature to want people who invest in you to do well whether they are investing simply time or emotional support or money. It takes a complete weirdo not to feel that way.

During the time Zuckerberg started Facebook he sent text messages like this to people.:

He even held contempt for his first website users, saying they were "dumb ****" to trust him with their personal data.

You can read more of these text messages here.

I have a Facebook account but over time use it less and less. I do not feel like it is a safe place and do not trust the site. I now wonder if I should delete it.

If you trust Facebook you probably aren't aware of the fact the company is making secret phone aps that will record your text messages and send them to Zuckerberg's team if you install it on your phone. The story was revealed a few months ago in newspapers around the world, such as this article in Australia.

This is not the kind of company I would ever want to invest in. If it falls to 18 maybe I'll buy it for a trade. But I would never just put my money into it thinking its going to be a great company 10 years from now. Who knows the IPO fallout may cause others to lose trust in the company and open the space for a competitor to take its place. Myspace and the other social media fad sites are gone. Who is to say Facebook won't be displaced one day either. It's nothing but a website.

What do you think?

for more:

Podcast: Jeff Pierce Gives His Update on Bonds and Warns About Further Selling in the Nasdaq to Come - Mike Swanson (05/23/12)

Podcast: David Bannister of ActiveTradingPartners.com Sees These Next Few Days As Critical for a Potential Trend Reversal - Mike Swanson (05/21/12)

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Podcast: Jeff Pierce Gives His Update on Bonds and Warns About Further Selling in the Nasdaq to Come - Mike Swanson (05/23/12)

Mike Swanson — Wed, 23 May 2012 16:25:40 +0000

I just did this podcast with Jeff Pierce who runs the popular trading blog www.zentrader.ca. When I last talked with Jeff he was bullish and bonds and today the TLT 20-year Treasury Bond ETF is trading at new highs.

I got Jeff's thoughts on bonds now and the rest of the market.

For more from Jeff check out his blog at www.zentrader.ca.

You can also download the mp3 audio file for this interview on your computer by clicking here WITH A RIGHT BUTTON CLICK and selecting SAVE FILE AS from the drop down menu.

If you have an itunes, ipod, or rss reader you can subscribe to the podcast by clicking here.

for more:

Podcast: David Bannister of ActiveTradingPartners.com Sees These Next Few Days As Critical for a Potential Trend Reversal - Mike Swanson (05/21/12)

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Yahoo (NASDAQ: YHOO) Shares Trade in a Narrow Range for Three Months - Fred Dunsel (05/23/12)

Fred Dunsel — Wed, 23 May 2012 10:23:16 +0000

Yahoo! Inc. (NASDAQ:YHOO) delivered a 1.5% weekly gain last week, closing at $15.42. The stock, which is currently down 4.4% for the year, has been trading $14.40 - $15.67 in the past three months. Following the departure of CEO Scott Thompson, the company’s stock was falling throughout last week, until Friday when it jumped about 6% on news that Yahoo was in talks to sell about 20% of Alibaba Group Holding Ltd. If successful, Yahoo could receive about $7 billion from the sale. Shares had also risen earlier in the week as Yahoo announced a deal to end a proxy fight with Third Point LLC, which is a large shareholder of the company.

The company, currently led by interim CEO Ross Levinsohn, is now facing increasing pressure to develop a strategy to attract Web surfers and advertisers who have been lured to rivals such as Google and Facebook. Referring to the recent departure of CEO Scott Thompson, Macquarie Securities analyst Ben Schachter said that Thompson’s abrupt exit would waste four months of turnaround work by the company, which is also something that Yahoo could not afford at this critical juncture. For example, the company’s annual revenue has fallen from $7.2 billion in 2008 to $5 billion in 2011, with no end to the declining trend. As for the online competition, Yahoo is currently third among Facebook and Google in terms of the amount of time users spent at the respective websites.

As a sign of how far the company has fallen, Yahoo’s stock price has not traded above $20 since September 2008. Currently with a market cap of $19 billion, Yahoo still has not been able to find its own unique selling point in the cacophony of online portals. Given the above, in an attempt to chart a new direction for the struggling web portal, Levinsohn, who is the third CEO in six months, reorganized the management team last week, with new appointments in the global media and commerce, and marketing divisions. However, whether Levinsohn’s revamped corporate strategy for Yahoo will eventually pay off remains to be seen.

for more:

Podcast: David Bannister of ActiveTradingPartners.com Sees These Next Few Days As Critical for a Potential Trend Reversal - Mike Swanson (05/21/12)

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Gold Stocks Still in a Decline as Market Vectors ETF Trust (NYSE:GDX) Drops - Fred Dunsel (05/23/12)

Fred Dunsel — Wed, 23 May 2012 10:20:36 +0000

Market Vectors ETF Trust (NYSE:GDX), the ETF for gold-mining stocks, fell by 1.75% last week, marking the third consecutive weekly decline. Closing at $41.62 last Friday, GDX has been on a downward trajectory since late February when it was still above the $57 level. The ETF, which is currently down 18.7% for the year, has also been down 9 of the past 11 weeks.

Gold-mining stocks are currently trading at record lows, relative to the price of gold. Among the largest underlying components of GDX, Barrick Gold Corp (NYSE: ABX) has been on the decline since late February, while Newmont Mining Corp (NYSE: NEM) still has not shown signs of arresting its stock price slide since last December.

While the precious metal has historically outperformed gold-mining stocks, the ratio between the two is now at an all-time high. The reason behind this phenomenon is that gold-mining companies are suffering from higher operating costs, primarily due to higher energy prices. According to the Daily Sentiment Index, a survey taken by veteran trader Jake Bernstein, only 10% of traders are bullish about gold-mining stocks. In early May, Berkshire Hathaway Vice Chairman Charlie Munger even said in an interview, "Civilized people don't buy gold." However, things could be changing soon. In the past week, there has been heavy trading volume in the GDX, which some analysts say, could be the start of a turning point.

As for gold itself, analysts remain bullish about the precious metal this year. In its recent research note, Morgan Stanley noted that “the fundamental factors that have driven the gold bull market remain very much in place”, citing examples such as the ongoing uncertainty in the euro zone and continued negative real interest rates in the US. Moreover, central banks are still buying gold, helping to sustain global demand. Given the above and the GDX’s current disconnect to gold prices, some analysts believe that gold-mining stocks have been oversold and are now due for a technical rebound.

for more:

Podcast: David Bannister of ActiveTradingPartners.com Sees These Next Few Days As Critical for a Potential Trend Reversal - Mike Swanson (05/21/12)

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Some See Opportunity In Amazon's (NASDAQ: AMZN) Recent Stock Drop - Fred Dunsel (05/22/12)

Fred Dunsel — Tue, 22 May 2012 10:54:23 +0000

Amazon.com, Inc. (NASDAQ:AMZN) fell by 6% last week, closing at $213.85 on Friday. The online retailer’s stock performance over the past three months has been rather volatile, trading around $178 - $232. While Amazon is currently up 23% for the year, it has been on the decline since peaking at $232 in end April.

According to the latest market speculations, Amazon is currently preparing for a 10-inch Kindle Fire to be launched in the third quarter of this year. Given that the Kindle Fire is the best-selling Android tablet today with a 54% market share, this means that Amazon is getting ready to pit itself against Apple’s iPad. In addition, the company is also planning to offer more ad space in either the current or subsequent generation of Kindle Fires. According to Ad Age, companies can fork out $600,000 to purchase an Amazon “Special Offers” ad to run for two months on the Kindle Fire.

Given the company’s aggressive expansion strategy as well as sound economic fundamentals, analysts are generally optimistic about Amazon’s prospects. Last week, Credit Suisse analyst Spencer Wang upgraded the company’s rating from “neutral” to “outperform”, while also raising the price target from $190 to $270. Wang wrote in his research note that Amazon’s business model would continue to boost gross profit margins in the coming year. The consensus forecast for the current quarter earnings per share estimate is $0.02, while that for the current quarter sales estimate is $12.9 billion.

On the other hand, there are also skeptics such as Greenlight Capital Inc. co-founder David Einhorn, who said last week that Amazon had yet to show how it could increase profit in tandem with sales. For example, as the company increased its spending on warehouses and expanded its line of Kindle devices, its operating margin had since fallen to 1.79%, as compared to 4.39% three years ago. It is believed that the offer to expand the Kindle’s ad space is one such attempt to boost the company’s operating margin.

for more:

Podcast: David Bannister of ActiveTradingPartners.com Sees These Next Few Days As Critical for a Potential Trend Reversal - Mike Swanson (05/21/12)

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Oracle (NASDAQ: ORCL) Has A Tough Week- Fred Dunsel (05/22/12)

Fred Dunsel — Tue, 22 May 2012 10:52:19 +0000

Oracle (NASDAQ:ORCL) continued its third consecutive weekly decline, falling by 5.15% to close at $25.61 last Friday. Oracle, which is currently down 0.7% for the year, was previously trading around $28 - $30, before falling precipitously since early May. Although the enterprise software giant’s fundamentals remain strong, its lack of a clear strategic direction thus far has not endeared it to investors in recent months.

Oracle is also currently embroiled in a high-profile lawsuit against Google over allegations that Google's (GOOG) Android mobile platform violates Oracle's (ORCL) intellectual property rights. Oracle is seeking $1 billion in copyright damages. The jury is now mulling over Oracle’s patent claims, though the potential patent damages appear to be far less than alleged by the company.

Some analysts feel that the company, with a market cap of $134 billion, is currently being overlooked and undervalued by Wall Street, especially its strong cash position and deep market penetration. Last week, the rating agency Fitch affirmed Oracle’s issue default rating at A+, noting the company’s “significant financial flexibility, strong customer attach and renewal rates for software maintenance and strong competitive position, especially in database and middleware software.” The consensus estimate for the company’s current quarter earnings per share is $0.79, while that of the current quarter sales is $10.9 billion.

In addition, Oracle is also poised to make a big play in the cloud computing market. For example, its recently launched RightNow CX Cloud Service is now integrated with Oracle Fusion Sales, which the company claims will help organizations target their customers with more relevant products and services. The company has also been aggressive with acquisitions that offer synergy in research and development, as well as other hardware companies such as Ksplice and Pillar Data Systems to remain competitive in the server and hardware businesses.

Given the above, it will be difficult not to be sanguine about a company that is currently number two in the applications and business software sectors, and has operating margins of 38% and profit margins of 26% in the most recent quarter.

for more:

Podcast: David Bannister of ActiveTradingPartners.com Sees These Next Few Days As Critical for a Potential Trend Reversal - Mike Swanson (05/21/12)

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Podcast: David Bannister of ActiveTradingPartners.com Sees These Next Few Days As Critical for a Potential Trend Reversal - Mike Swanson (05/21/12)

Mike Swanson — Mon, 21 May 2012 13:26:16 +0000

I just did this podcast with David Bannister of www.activetradingpartners.com in which we discussed his outlook for the stock market.

David uses trend psychology and Elliot Wave theory to understand and forecast the moves in the financial markets. In this interview we talked about his trend reversal trading method and what he thinks the stock market will do over the next few months.

In Dave's view the market may have made a key top a few weeks ago. He sees the action the next few days critical in determining whether the market has made a top or whether the correction is over. If the S&P 500 can get above 1340 then he believes the trend will have changed the bulls will be back in control. The next few days will tell the tale.

For more from David just go to www.activetradingpartners.com

You can also download the mp3 audio file for this interview on your computer by clicking here WITH A RIGHT BUTTON CLICK and selecting SAVE FILE AS from the drop down menu.

If you have an itunes, ipod, or rss reader you can subscribe to the podcast by clicking here.

for more:

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Technical Analysis

WSW Articles:

Stock Market Commentary

Analyst Puts Sell Rating on Facebook (NASDAQ: FB) - Fred Dunsel (05/21/12)

Fred Dunsel — Mon, 21 May 2012 11:17:01 +0000

Last Friday saw the public listing of social networking giant Facebook (NASDAQ:FB). Facebook managed to sell 421.2 million shares last Friday, valuing the company at $104.2 billion.

Contrary to initial expectations, the IPO generated no big stock gains, with the stock closing at $38.23, a mere 0.6% gain from its IPO price of $38. In fact, Morgan Stanley, the lead underwriter in Facebook’s IPO, had to step in to prop up the stock from dipping below the IPO price. According to people familiar with the IPO process, Facebook and Morgan Stanley decided to set the IPO price at the higher end of the range so as to get more pre-IPO investor, such as Goldman Sachs and Accel Partners, to sell more of their stock. However, this also meant that there was not much of a stock gain on the first day of trading, as it only reinforced suspicions that the stock was overvalued. Financial analysts said that Facebook’s lackluster performance might even have an adverse effect on the IPO market in the short term, with some technology companies reconsidering the timing and valuation of their own IPOs.

The long-term viability of Facebook’s advertising revenue model in terms of attracting companies onboard and helping them to monetize their products is now coming under closer scrutiny. Brian Wieser of Pivotal Research Group downgraded Facebook to a “sell”, with a $30 price target. Wieser described Facebook as “overvalued on a fundamental basis”, citing examples such as rising operating expenses, unproven ad model and acquisition risks (e.g. the Instagram acquisition). James Hughes, chief market analyst at London's Alpari, said “the real value of Facebook is not likely to be known until the hype of the IPO has died away and investors have been able to digest how the company is going evolve to be the money-making machine many expect it to be.”

Nonetheless, many also acknowledged the immense growth potential of the company, especially given its widespread popularity throughout the world. The key for Facebook now is to find a sustainable growth model that can translate this popularity into revenue and profits.

for more:

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

The Outlook For The Greece 20 ETF (NYSE:GREK) - Fred Dunsel (05/21/21)

Fred Dunsel — Mon, 21 May 2012 11:13:29 +0000

A lightly traded ETF indexed to Greek stocks – Global X FTSE Greece 20 ETF (NYSE:GREK) - fell by 14.1% last week on worries that Greece will be forced to leave the euro zone amid political uncertainty as the country heads for another round of polls in June. Closing at $10.72 last Friday, the ETF has been on a downward trajectory since peaking at $19.40 in mid-February. In fact, GREK’s performance has been a close barometer of Greece’s economic and political conditions.

Currently, all eyes are on Greece’s June 17 elections, the second in just six weeks. In the election on 6 May, Greek voters roundly rejected the austerity measures that had been previously supported by the key parties in Greece. Hence, the June 17 elections are now being seen as a sign of where the country’s future lies. If Greece continued to reject the austerity measures, its membership in the euro zone will become very tenuous, given that its domestic finances are in a big mess.

JP Morgan Chase Bank analyst David Mackie raised the likelihood of a Greek euro exit from 20% to 50% if Syriza, a left-radical party wins the elections and rejects the euro zone-imposed austerity measures. That would prompt Greece's creditors to withhold any further bailout funds and push the country into reverting back to its old currency, the drachma. Moreover, a Greece that is unwilling to accept the austerity measures means that Spanish, Portuguese and Italian bond yields will also face increasing pressure, which could ultimately break up the euro zone.

Given the above, the fall of Greek equities has been so dramatic that GREK is now trading well below the $14 mark where it debuted last December. In addition, the country's economic woes have prompted speculation among traders that it could be demoted to emerging markets status by the companies that provide indexes to ETF sponsors. It also would not help matters that credit rating agencies are also expected to downgrade Greece again, though that impact by now might not be as big as before.

for more:

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

S&P 500 VIX Short Term Futures ETN (NYSE:VXX) Due for Pullback - Fred Dunsel (05/21/12)

Fred Dunsel — Mon, 21 May 2012 11:10:57 +0000

Last week, iPath S&P 500 VIX Short Term Futures ETN (NYSE:VXX) continued its upward trajectory that started in early May. On Friday, it closed at $22.40, marking a 28% gain for the week. Currently down 36% for the year, VXX fell precipitously in the first three months of this year, before trading between $16.50 and $20.50 in April. It was only on 1 May did it begin its remarkable rise of 38% over a period of less than three weeks. However, what this translates into is that there has been increasing market volatility, brought about by global developments, particularly those in Europe in recent weeks.

Volatility indices, one of which is the VXX, typically move inversely to stocks, thus they are also commonly known as “fear indicators”. VXX is designed to track volatility in the markets as measured by the Chicago Board Options Exchange Market Volatility Index (CBOE Index), a popular measure of the implied volatility of S&P 500 index options. VXX’s performance last week was a reflection of widespread fears of a Greek exit from the euro zone and the implications of such a move on global financial markets.

Amidst the global stock doldrums last week, it didn’t help that there were also profit-taking pressures on the S&P 500 Index. Even better-than-expected economic data releases in the US last week (e.g. retail sales grew by 0.1% in April, and the home builders index rising from 24 to 29) did not help to boost market sentiments. On Friday, social network Facebook’s worse-than-expected IPO performance only further cooled market sentiments, a situation which is reflected in VXX’s 6.5% jump that day.

Given the ongoing uncertainty in Europe, increasing market volatility is likely to remain the norm for now. Under such circumstances, VXX will also be closely watched by investors on a daily basis in the next few weeks.

However the stock market is so oversold now that it is likely to bounce this week. If it does VXX will drop.

for more:

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Stock Market Still Shaky As Europe Weighs, Facebook Disappoints, Japan Rebounds - Tim Bellamy (05/20/12)

Tim Bellamy — Sun, 20 May 2012 23:10:52 +0000

The fallout from European debt, economic, and political problems again took their toll this week, as markets continued their downward lurch.

Despite Germany’s economy rebounding strongly, the Eurozone only narrowly managed to avoid a second quarter of declining economic contraction. After a 0.3% contraction in the fourth quarter of last year, Europe’s economy remained unchanged in the first quarter, helped by Germany’s 0.5% growth. France’s economy remained unchanged, while Italy and Spain both contracted (0.8% and 0.3% respectively).

Meanwhile, Greece still can’t manage to put together a government. It will revisit polls in June, though it is likely that the €190 billion of bailout money given to it will have run out by then. Greek depositors have begun to withdraw money from Greek banks – it’s believed that last Monday alone over $800 million was withdrawn – and Fitch has further downgraded Greece’s credit rating. European leaders are voicing ever more vociferously the view that the country will leave the Euro and default on its debt.

It is thought that depositors are also withdrawing funds in large amounts from Spanish banks, and Moody’s has downgraded all 16 of its banks, including Santander, the fourth largest bank on Britain’s high streets. The ratings agency also hit all of Italy’s banks. Spanish government bond yields are firmly above 6%, and concern is rising that the country will have to seek a bail out similar to Greece’s.

Here in the United States, housing starts were strong, rising by a greater than expected 2.6% in April, and mortgage delinquency has fallen to its lowest level since 2008. Increasing motor sales helped industrial production, at 1.1%, rise to its highest level since December 2010, and after three months of rises, the consumer price index remained static in April. Rounding off a good week on the economic front for the United States, weekly jobless numbers were unchanged at 370,000.

In Asia, inward investment into China has fallen during the first quarter from a year ago, though in response to its slowing economy the country is cutting its reserve requirement for banks by 0.5%. This should make it easier for Chinese banks to lend money and boost the economy.

Japan’s economy has grown by 4.1% annualized during the first quarter of 2012 as government spending supports rebuilding efforts post the tsunami. Some economists are now questioning how long this level of spending can continue, however, as the country starts to buckle under the weight of its sovereign debt, which is the highest of all the industrialized countries.

Looking at corporate news the Facebook (Nasdaq: FB) IPO raised $16 billion, more than expected and the third largest in US history. The company priced its shares at $38, the upper end of the forecast range, and sold 421.2 million shares. However, on the first day of dealings, share dealing volumes suggest that many of these shares have been sold in the market, and the share price only just managed to stay in the black, closing the day at $38.23.

In the retail sector, both Wal-Mart (NYSE: WMT) and Home Depot (NYSE: HD) beat market expectations, with profits rising by 10% and 27% respectively.

Meanwhile, Hewlett Packard (NYSE: HPQ), suffering for some years with declining revenue and earnings, is expected to announce jobs cuts of around 8% (or 25,000) worldwide, and Coty has withdrawn its $10.7 billion offer for Avon Products (NYSE: AVP).
The banking sector continues to be pressured by expectations of increased regulations in the wake of JPMorgan’s (NYSE: JPM) $2 billion trading loss announced last week.

After last week’s falls, the Dow Jones Industrials dropped by a further 451 points, or 3.5% to close the week at 12,369.38, and the S&P 500 fell by 4.3% to 1295.22. The Nasdaq 100 cut a massive 5.2% off its value, finishing Friday afternoon at 2478.53.

This Week’s Economic Releases

Monday 21st May

Markets will react to any news from the weekend’s G8 conference, though little concrete policy decisions are expected.

Tuesday 22nd May

The Band of England announces its inflation forecasts, and here in the United States existing home sales may point to further progress in the housing market.

Wednesday 23rd May

In Asia, the Bank of Japan holds its press conference, while in Europe the MPC releases its latest meeting minutes and retail sales data will give some idea of consumer confidence. New home sales figures in the United States follow on from yesterday’s existing home sales data. In Canada, retail sales data is released.

Thursday 24th May

The ECB President, Mario Draghi, will make his latest statement. German and UK gdp data may highlight the difference between Europe’s two largest economies, whilst durable goods orders and initial jobless claims in the United States will be eyed keenly for signs of a growing economy.

Friday 18th May

Canadian inflation numbers are announced, as is economic activity data in Argentina.

This Week’s Major Company Results Due:

Eyes will be on Hewlett Packard (NYSE: HPQ) on Wednesday for signs of cost cutting measures.

for more:

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Podcast: Ike Iossif on How the Marketviews.tv MGCI Indicator Is Giving a Sell Signal - Mike Swanson (05/20/12)

Mike Swanson — Sun, 20 May 2012 11:09:33 +0000

I just did this fascinating interview with Ike Iossif of marketviews.tv.

Ike interviews many people each week for his Marketviews.tv website, including myself, and has them categorized by methodology. These people are many of the top thinkers and traders when it comes to the financial markets, such as people like Frank Barbera and Dan Zanger who turned less than $30,000 into millions in less than a year.

What Ike has found is that he can gauge important intermediate-term markets turns by measuring the market outlook of his guests. This doesn't work like the Investors Intelligence Survey, which looks for people to be wrong at key turning points, but works just the opposite. Instead Ike finds that when a large number of his guests have a neutral view due their methodologies for a long period of time it means a big move is about to happen.

Investors Intelligence polls a random mad dash group of newsletter writers who often are wrong at key market turning points whereas Ike has picked out guests that more often than not are right at these moments - and they use a whole lot of different methodologies to come to their conclusions. They are the best of the best.

So what Ike has done is taken the views of the experts he interviews and creates an aggregate indicator with them. If you recall I interviewed Ike about this back in January when this indicator gave a neutral signal. It is now giving a sell signal.

This is the third sell signal it has put out in thirteen years so it's a big deal.

We talk about this in this interview:

I also got Ike to agree to a 50% discount for a one year membership to Marketviews.tv until Tuesday. This is the cheapest he has ever sold it for annual access and he probably will never do it again. If you want to get the best commentary from the best thinkers on the market then I recommend you check it out by going here.

I have been a listener of Marketviews.tv myself for over a decade now, because I find it useful to hear the views of the top people using different strategies. It's great for learning and thinking.

Here is the MGCI chart:

Timing model:

To get the next update of the MGCI chart subscribe to Marketviews.tv right now by going here.

You can also download the mp3 audio file for this interview on your computer by clicking here WITH A RIGHT BUTTON CLICK and selecting SAVE FILE AS from the drop down menu.

If you have an itunes, ipod, or rss reader you can subscribe to the podcast by clicking here.

for more:

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Should You Buy Facebook (NASDAQ: FB) Stock? HA!!!!! - Mike Swanson (05/18/12)

Mike Swanson — Fri, 18 May 2012 10:30:51 +0000

Facebook. It is going to start to trade today on the Nasdaq under the symbol FB. It has been the talk of the financial news all week and I have even gotten a few emails about it from people asking if I think they should buy it.

Most of these people remember Google. They remember that back before Google went public there were financial commentators saying that it was overvalued and that they shouldn't buy it. And of course Google went up and became one of the strongest stocks in the market.

People also I believe are interested in Facebook simply because they like it. They like having a profile and posting pictures and comments and getting attention from their "friends."

Well I treat Facebook like any other stock and IPO.

I'm not going to buy Facebook when it opens today. For two reasons. One simple reason is that I am getting ready for some huge opportunities and am saving my money for that.

I'll get to that in a second.

But the second reason is that I believe you SHOULD NEVER buy an IPO on the opening day. It's great if somehow you bought some Facebook before today and before it goes public. If you did I'm happy for you. But most people haven't.

The problem is what a stock does after it starts to trade in its first day is simply random. There is no chart history to help you figure out the trend. There is no real earnings history to understand the company with - and BTW - Facebook earnings have been flat the past few months.

If you want to trade a newly trading stock I believe the best thing to do is just wait a few weeks. IPO's do one of two things. They either open up and crash to nothing over time or else they open up, go wild for a day or two, and then pullback and form a new base. If they are truly the next Google they then break out of that base and start a long march up.

So the prudent thing to do if you want to play Facebook is just wait to see if it bases and then buy if it breaks out.

Look and see how this would have worked with the other social media stock of this year ZNGA:

Now if you just buy right on the open to be frank I think you are nothing but a pure gambler. You are coming to the stock market in my view with no plan at all. And with no plan you might as well just go to Vegas and play the slots.

Also I think it is important to point out to you that the stock market is in a correction that is likely to continue for at least another month or two. If Facebook holds up and bases out during that correction then I may even buy it. But I'll let the market and Facebook stock prove to me if it's going to be a good one to buy instead of just buy today and hope. I want the stock to PROVE ITSELF TO ME!!!! Otherwise I don't care. And I'm not going to buy Facebook just because I like the website, because Facebook the company doesn't care about me. So why should I just give it money for nothing?

And as for its fundamentals I don't think anyone can argue that it is a cheap company to buy.

Now personally I see some much bigger opportunities than Facebook to buy into also - real companies that are at super cheap valuations. Of course we have the gold stocks that have been melting down.

But the Greek stock market is currently trading at a P/E of around 6!!! I think it has lower to go. But once it nears default I'm going to start to build a position in Greek stocks. I'm looking at one that is trading around $1.00, has a P/E around 3, pays an 8% dividend, and is probably going to fall down to 50 cents and then end up at $10 in 2013. I'll put a report together about the Greek stocks I'm looking at soon for Power Investor members and send them a buy alert once I do buy. It probably will be in 4-6 weeks.

I spent about three hours on the phone last night talking to Dave Skarica about the opportunities in Greece and I woke up at 5:00 AM this morning excited about them! I'll write about it in detail for you over the next few weeks.

As for the stock market. I think we're due for a bounce. Gold and gold stocks seems to have been leading the market and were up big yesterday so I expect the market will bounce here too for a few days. Maybe even a week!

for more:

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Google (NASDAQ: GOOG) Plans New Youtube Moves - Fred Dunsel (05/18/12)

Fred Dunsel — Fri, 18 May 2012 10:10:44 +0000

Google Inc. (NASDAQ:GOOG) closed at $605.23 last Friday, marking a 1.4% gain for the week. The stock is currently down 5.8% for the year. After peaking at $651 in mid-April, Google has generally been on a downward trajectory, trading around $592 - $615. The stock has been trending lower after its quarterly numbers showed a decline in advertising rates and other worrisome business trends.
Google is facing an ongoing lawsuit for allegedly infringing Oracle Corp’s copyrights on the Java programming language. The lawsuit, which was filed in August 2010, revolved around patent claims, especially on the fairness of using application programming interfaces (APIs or a set of tools through which developers utilize the Java software language). Last week, the jury ruled that if Google was found to be using Oracle’s Java programming in all fair means, then the company would not be liable for any damage costs. Google’s lawyers have since challenged the key jury finding on Java copyrights and moved for a mistrial. (Oracle countered that rather than retrying the issue, the judge could simply intervene with a decision that would take the place of a mixed verdict – with Google guilty of some infringement, but also reducing Oracle’s ability to recover a large amount in damages.)

Notwithstanding its legal troubles, analysts remain optimistic about the company. Not only do its fundamentals remain strong, the company is also on the lookout for innovative ways to boost growth.

In its 14 May edition, Barron’s wrote that, with reference to the imminent IPO of Facebook, Apple and Google were “proven growth companies with much lower valuations and cash-laden balance sheets”. Last month, in its first-quarter earnings announcement, Google achieved $8.14 billion in revenue, above analysts’ expectations of $8.09 billion. Its revenue was helped by a 39% increase in “paid clicks”, although the “cost-per-click” for these ads fell 12% as compared to a year ago.
According to the New York Post, Google’s YouTube unit is considering the introduction of a premium, subscription-based video service. YouTube intends to add more top-shelf content to its channels, though these would subject to subscription fees. There have also been market speculations that Google is currently in negotiation to buy social-products company Meebo for about $100 million. Meebo allows developers to create and run applications and services on both its web and mobile infrastructure.

for more:

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary

Microsoft (NASDAQ: MSFT) Is Still a Big and Strong Stock! - Fred Dunsel (05/18/12)

Fred Dunsel — Fri, 18 May 2012 10:09:00 +0000

Tech giant Microsoft (NASDAQ:MSFT) closed at $31.16 last Friday, eking out a 0.58% gain for the week. For the past three months, Microsoft has been trading around $30 - $32.85. The stock is currently up 19.8% for the year. Microsoft last posted its quarterly earnings on 19 April, when it reported earnings of $5.1 billion or 60 cents per share, above the consensus estimate of 58 cents. Its revenue reached $17.4 billion, up 6% over the previous year.
Most of Microsoft’s businesses posted excellent sales growth over the previous year: 14% for the server and tools division; 9% for the business sector; 6% for online services; and 4% for Windows sales. Only its gaming business posted a 16% drop to $1.6 billion.
In late April, the company announced that it would pay $300 million for a 17% stake in a new division (Newco) of Barnes & Noble, Inc. that included the “Nook” e-book reader and downloadable material. For Microsoft, the addition of the e-book reader will be an attractive bonus in its “Windows 8” mobile version, due to be launched in summer.

The company is now increasingly sending signals that it intends to become a major player in the lucrative but competitive smartphone sector. With widespread acceptance of its “Kinect” and “Xbox” console, the company is also in a strong position to grab a bigger market share in the mobile and gaming sectors. Given the above, Microsoft, which currently has a market cap of $269 billion, is poised to enhance its competitiveness in these high-growth businesses.

Hence, notwithstanding its lackluster stock performance in recent months, analysts are generally optimistic about Microsoft, especially given its strong financial fundamentals and growth potential. Las week, analysts at Stifel Nicolaus initiated coverage on the company and set a “buy” rating and $38 price target. McAdams Wright Ragen analysts raised their price target from $34 to $36, as well as upgraded their rating to “buy”. Barclays Capital also raised their price target from $33 to $36, while giving the stock an “equal weight” rating. Goldman Sachs also restated their “neutral” rating on Microsoft.

for more:

Podcast: David Frazier Who Gave a Market Sell Recommendation on April 1st Sees Opportunities in This Market - Mike Swanson (05/16/12)

Stock Market Is Now In A Correction - Mike Swanson (05/16/12)

Podcast: Victor Riesco Talks About the Current Stock Market Action and His New Signals System - Mike Swanson (05/09/12)

Podcast: Investment Author Michael Panzner Gives His Updated Views on the Financial World - Mike Swanson (04/23/12)

Podcast: Reggie Middleton On How AAPL Now Has a Market Cap Bigger than All Other Retails Stocks Combined - Mike Swanson (04/20/12)

Topics:

Stock Market News

WSW Articles:

Stock Market Commentary