Monday, November 28, 2011

The Morning Call Monday Morning Chartology & Subscriber Alert


The Market
Technical

Monday Morning Chartology


No real support between current levels and 1101.




GLD is still holding its intermediate term up trend, though just barely.



VIX remains in that upper zone of its current trading range--a negative for stocks.



Fundamental


Europe over the weekend (medium):
http://www.nakedcapitalism.com/2011/11/eurocarnage-continues.html

The futures are up big this morning. Part of this bounce is likely only a relief rally after the horrendous Thanksgiving week shellacking.

Part of it I am assuming is the gangbusters Black Friday. To be sure, that is good news within the context of whether or not we get a ‘double dip’. It also makes me feel a bit better about the 10725, 1101 support level. That said, if the EU debt crisis continues to worsen, there is some probability that investors will become more negative on the US economic growth prospects--assuming that this is not already in the price of stocks. My point is that I am cautious about getting jiggy over one weekend’s retail sales.

Finally, there were a couple of rumors out of euroland: the IMF would bail out Italy and the Germans along with five other countries would issue Eurobonds, the proceeds of which would be used to buy bonds of the troubled PIIGS. Both have since been denied, but they seem to have had a positive affect on the futures.

Bottom line: I don’t believe that the worst is over; so our Portfolios will continue to lighten up on stocks that have broken technically.

Subscriber Alert

At this morning’s opening, our Portfolios will continue to chip away at stock’s that are technically broken and that appear to have considerably more downside.

The Dividend Growth Portfolio will Sell the remaining shares of the Australian ETF (EWA), the Brazil ETF (EWZ) and reduce the Emerging Markets ETF (DEM) to a one half position.

The High Yield Portfolio will Sell the remaining shares of the Australian ETF (EWA), the Brazil ETF (EWZ) and reduce the Emerging Markets ETF (DEM) to a one half position. It will also reduce its holding in Caterpillar (CAT) to a one half position.

The Aggressive Growth Portfolio will Sell the remaining shares of the Australian ETF (EWA), the Brazil ETF (EWZ) and reduce the Emerging Markets ETF (DEM) to a one half position. It will also reduce its holdings of Quality Systems (QSII) and Holly Frontier (HFC) to one half positions.