Technical Outlook for Selected Stocks - July 8, 2010

End of the Day Technical Analysis

Summary: Caution
The AC Ratios of all monitored stocks has been increasing since July 2, and today reached extremely high levels, which is a bearish sign. Today TBS indicates little buying pressure; it seems everybody was selling today, selling short as well. Almost all stocks of the group made extremely wide ranges, but the volume was not so impressive.
However, PLRs show a bullish divergence. Closing prices crossed above its 10-days MAs, which is also bullish signal.

Long-term: Bearish.
CAT, CVX, HPQ, IBM, and UTX monthly charts – bullish crossings of the 40-days and 80-days MAs, but it is too early to bet on long-term reversal.




From Old Magazines

" No matter what any one says there is always a short interest in the market arid after every depression there is always an interest which believes the market is going Lower and they will stay short until forced to cover. Manipulators build on stubborn human nature. After the shorts are run in, the manipulators buy to make a further rise."

Frank H Tubbs. A Sign of Bull Move.The Ticker and investment digest.1910

Events Affecting U.S. Business

Congress is considering a mandate for a nationwide renewable electricity standard (RES). Heritage Foundation energy policy experts explain why an imposed national RES would be bad for families, bad for business, and bad for the economy.

RES as outlined below would:

• Raise electricity prices by 36 percent for households and 60 percent for industry;

• Cut national income (GDP) by $5.2 trillion between 2012 and 2035;

• Cut national income by $2,400 per year for a family of four;

• Reduce employment by more than 1,000,000 jobs; and

• Add more than $10,000 to a family of four’s share of the national debt by 2035.

Read the full article here: A Renewable Electricity Standard: What It Will Really Cost Americans. Published on May 5, 2010 by David Kreutzer, Ph.D. , Karen Campbell, Ph.D. , William Beach , Ben Lieberman and Nicolas Loris. Center for Data Analysis Report #10-03

Technical Outlook for Selected Stocks - July 7, 2010

End of the Day Technical Analysis

The main trend remains bearish. All stocks of the group are overbought but there are some divergences indicating an overbought bounce.

It seems, during the last 2-3 trading days some protective stops below the previous lows and above the previous highs were cleared out. Today at the market Open, TBS indicated selling pressure.

The AC Ratio moved at the slowest pace since the middle of June, which is a bullish sign. But the Daily Balance Point (DBP) indicator is too high for all stocks, which might be taken as a caution sign.

Sentiment is slightly more bullish than it was the previous week.

Long-Term: Bearish. The Closing Prices of most of the stocks remain way below the 40-days MAs and the 80-days MAs, which might be taken as bullish indication for a very short-term, but the monthly trend is still bearish for all stocks of the group.

Events Affecting U.S. Business

The Wall Street Journal:
• Russian oil has taken an unexpected turn to the U.S., where it is making inroads on the West Coast.
• Imports have gone from zero to an estimated 100,000 barrels a day in a matter of months.
• The Russian pipeline is challenging Alaskan oil, underscoring once again Russia's potential to throw established trading patterns into disarray. The pipeline is expected to revive Russian production growth.
• Alaska’s oil will be displaced as more Russian crude hits the coast, experts say.

Events Affecting U.S. Business: U.S, Poland and Shale Gas

U.S. Secretary of State Hillary Clinton today announced plans for the United States and Poland to cooperate on exploiting shale gas. Poland recently announced it has a huge deposits of shale gas.

Wood Mackenzie, the oil and gas research group, estimates that there could be as much as 48 trillion cubic feet (1,36 trillion cubic metres) of unconventional gas stretching across northern and central Poland. The gas, which does not lie in conventional reservoirs but inside tight rock formations, has become accessible only recently through the use of new hydraulic fracturing technology developed in the United States.

If confirmed, Wood Mackenzie’s estimate would boost the European Union’s proven reserves of natural gas, which stand at 101 trillion cubic feet, by 47 per cent and be enough to make Poland, which imports 72 per cent of its gas, self-sufficient for the foreseeable future.

Two Houston-based companies, ConocoPhillips and Marathon Oil, are betting that Poland, which gets half of its natural gas from Russia, can yield a development boom in shale formations like those that drove a jump in U.S. output of the heating fuel.

The U.S. oil companies obtained exploration licenses this year covering hundreds of thousands of acres in Poland. The country, which imports 72 percent of its gas, could become an exporter of the fuel, said Maciej Wozniak, chief adviser on energy security to Prime Minister Donald Tusk.

“Everything leads to a conclusion that in four or five years, and this is how much time we have to prepare for this, Poland will become a place with quite a lot of gas,” Wozniak said.

Limit your exposure to the woes facing outside markets

"Despite the near-term uncertainties surrounding our economic recovery, it's important to have significant domestic exposure, especially in light of Europe's troubles and fears of a sharp slowdown in China," says Alec Young, a stock strategist with Standard & Poor's.
Some investment pros say putting some money into stock and bond mutual funds that have a mostly domestic focus is a way to limit your exposure to the woes facing outside markets -- and it gives you access to sectors and products that some experts believe are consistently the most stable parts of the U.S. market:

• U.S. utilities and telecoms don't have exposure to problems and risks in other countries and they have high dividend yields.
• With business models that could be less affected by regulatory reform and more capital, regional banks may be in a better position than their small community bank and larger bank counterparts.
• U.S. defense is an industry with typically few surprises.
• The default risk on government and Treasury bonds is extremely low.
• Tax-free municipal-bond funds that invest in one or multiple states are another way to invest at home. Unlike Treasurys, interest from muni bonds isn't taxed at the federal level.
• The U.S. dollar has been holding its value as of late, especially against the euro.

Source: The Wall Street Journal

Can world's largest laser zap Earth's energy woes?

"One gallon of seawater would provide the equivalent energy of 300 gallons of gasoline; fuel from 50 cups of water contains the energy equivalent of two tons of coal."

source: CNN.com

Metals: Rare earth mining to be restarted in California

Efforts to re-establish American production of rare earth elements at a San Bernardino County mine gained momentum in recent days, as lawmakers in Congress voiced their support for the plan to end China's virtual monopoly on the minerals.
During a congressional hearing last week, House members on both sides of the aisle spoke favourably about the push to ramp up operations at the Mountain Pass Mine, with one of them introducing a bill that could help yield funding for the $450 million plan.
The Mountain Pass Mine, northeast of Baker, contains the largest known deposits of rare earth elements outside of the Inner Mongolia region of China. Prized for their unique magnetic and conductive properties, the roughly 15 rare earth minerals – which include europium, neodymium and yttrium – are used to make dozens of products, from DVD players and laptop computers to hybrid cars and guided missile systems.

source: Metals Place

Foreign firms not to give bribes in Russia

• Dozens of international firms doing business in Russia are to pledge not to offer bribes, in a move aimed at fighting corruption collectively.
• Among more than 50 predominantly German companies which are set to sign the agreement are Siemens, Deutsche Bank, Deutsche Bahn and Axel Springer AG.
• Elena Panfilova, head of Transparency International in Russia said that any company working in Russia could find itself in a situation when it did not want to give bribes but was forced to do so if it wanted to carry on doing business. The agreement would not solve situations such as these, she said.
• Most experts agree that foreign companies' readiness not to offer bribes in Russia is a good sign, but it will not be enough to eradicate corruption any time soon.

Source: BBC News