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 Post subject: September 27th Monday 2010 Emini TF ($TF_F) points +4.90
PostPosted: Tue Sep 28, 2010 9:32 am 
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Special thanks to Bloomberg, CNNMoney and Yahoo! Finance for their market summaries. gm

Bloomberg Video Summary @ http://www.youtube.com/watch?v=myEpZ8NQnqY
U.S. Stocks Fall as European Debt Concerns Increase
Sept. 27 (Bloomberg) -- Bloomberg's Courtney Donohoe reports on the performance of the U.S. equity market today. Stocks fell, trimming gains in the best September for the Standard & Poor's 500 Index since 1939, and the euro slumped as yield spreads for Irish and Portuguese debt jumped to record closing levels. Treasuries gained after a $36 billion auction of two-year notes.

Stocks Drop From 4-Month Highs
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By Blake Ellis, staff reporter
September 27, 2010: 5:00 PM ET

NEW YORK (CNNMoney.com) -- U.S. stocks kicked off the week with losses Monday, backing off strong gains logged in the previous week, as investors digested a small flurry of corporate dealmaking.

The Dow Jones industrial average (INDU) slipped 48 points, or 0.4%, the S&P 500 (SPX) ticked down 6.5 points, or 0.6%, and the Nasdaq (COMP) lost 11 points, or 0.5%.

Wall Street has been on a nice tear lately, as economic readings have started convincing investors that the recovery is gaining ground. U.S. stocks soared to their highest levels in four months Friday, and are still poised to end September with the biggest monthly gains in more than a year.

"The tone of economic news has gotten significantly stronger over the last four to six weeks," said Phil Orlando, chief equity strategist at Federated Investors. "This has provided investors with greater confidence that what we experienced over the summer months was simply an economic soft patch rather than the start of a double-dip recession."

With little on the economic calendar Monday, investors are soaking in the advances from the previous week and focusing on deals announced by Southwest Airlines, Wal-Mart and Unilever.

"We do have a very aggressive [merger and acquisition] cycle, and that's good for the market," he said. "But the market doesn't go up 2% every day, so right now we're just nursing a hangover."

Economy: As the market nurses its hangover, there's still plenty for investors to worry about, said Joseph Saluzzi, co-head of equity trading at Themis Trading.

With the government's seizure of three credit unions on Friday and Moody's downgrade of Anglo Irish Bank on Monday, the health of global financial institutions remains a huge concern, he said.

"The government bailing out those credit unions shows that toxic assets are still on the books, there are still things being hidden and nobody know's what's going on," he said. "And the concern about European sovereign debt is tremendous -- all those countries are connected, so if one is required to be bailed out, it's going to affect everyone else."

And while declines were generally broad-based Monday, financial stocks took a hit, with industry leaders JPMorgan Chase (JPM, Fortune 500) and Bank of America (BAC, Fortune 500) sliding more than 1%.

"People have been thinking it's all fixed but we've still got a long way to go," Saluzzi said.

Painfully high unemployment, home prices and the government's enormous deficit are other issues still weighing on the minds of investors, he said.

Companies: Southwest Airlines (LUV, Fortune 500) announced a $1.4 billion offer for AirTran Holdings (AAI), the parent company of AirTran Airways. The bid amounts to a 69% premium over AirTran's Friday closing price. The announcement sent AirTran stock surging 61%, while shares of Southwest rose 9%.

Shares of Wal-Mart (WMT, Fortune 500) slipped 1% after the company bid to acquire Johannesburg-based retailer Massmart Holdings Limited for roughly $4 billion. Massmart operates 290 stores in 13 countries in Africa. A deal has not yet been agreed to.

* Get used to manic merger Mondays - The Buzz

Consumer goods giant Unilever said it is buying Alberto Culver (ACV), manufacturer of the Tresemme and Noxzema brands, for $3.7 billion. Shares of Alberto Culver jumped 20%, while Unilever (UN) shares edged up 1%.

While deal-making activity tends to boost the market, Saluzzi said that the recent flurry of mergers and acquisitions should make investors wary.

"[Mergers and acquisitions] are destroyers of jobs, not creators of jobs," he said. "So I don't buy it that these are a good thing."

Meanwhile, Progress Energy (PGN, Fortune 500) tripped a circuit breaker, causing trading of the energy company to pause for five minutes after shares briefly plunged 90%.

After the market close, BlackBerry maker Research in Motion (RIMM) announced plans for PlayBook, a new tablet computer to compete with Apple's iPad. Shares of the company jumped more than 1% in after-hours trading.

World markets: European stocks ended lower. Britain's FTSE 100 fell 0.5%, Germany's DAX slid 0.3% and France's CAC 40 dropped 0.4%.
0:00 /1:10Japan's $55 billion boost

Asian markets finished the session with strong gains. Japan's Nikkei and the Shanghai Composite climbed 1.4%, and the Hang Seng in Hong Kong rallied 1%.

Currencies and commodities: The dollar rose against the euro and the Japanese yen, but fell versus the British pound.

The price of oil for November delivery edged up 3 cents to settle at $76.52 per barrel.

Gold futures for December delivery surged to a new record, settling at $1,298.60 an ounce. On Friday, gold hit a new intra-day record of $1,301.60.

Bonds: The yield on the 10-year Treasury note fell to 2.53% from 2.61% late Tuesday.

Image

Yahoo! Finance

4:30 pm : Stocks had looked like they might muster a slight gain in the final hour of trade, but a late-session selloff led stocks to finish at their lows with broad losses.

Financials led the slide into the close. The sector shed 1.2%, which makes for the worst loss of any major sector. Regional banks were under some of the most pressure; they dropped 2.2%.

In contrast, telecom stocks held on to their gains. In turn, the sector made it out with a 0.9% gain. The sector's lack of market weight left it unable to provide legitimate leadership to the broader market, though.

Airline shares also outperformed. Their strength helped the Amex Airline hit its highest level in almost three years. Its 1.8% gain was underpinned by news that Southwest Air (LUV 13.35, +1.07) will acquire Air Tran Holdings (AAI 7.34, +2.79) for $7.69 per share, a 69% premium over AAI's closing price from Friday.

Alberto-Culver (ACV 37.64, +6.16) also made merger and acquisition news with word that it will be acquired by Unilever for $37 per share, which represents a premium of about 17% over ACV's closing price from last week.

A lack of data, market moving headlines, and the absence of a consensus regarding the direction of the stock market kept participants on the sidelines. That depressed share volume, such that trading volume on the NYSE failed to break 1 billion shares again. Since the start of September trading volume on the Big Board has only broken above 1 billion shares on four occasions.

Treasuries had a strong session that saw the yield on the 10-year Note slide to 2.52%. The yield on the 2-year Note eased to just below 0.42% following an auction of 2-year Treasuries that drew a bid-to-cover ratio of 3.78, dollar demand of $136.1 billion, and indirect bidder participation of 39.0%. For comparison, the prior auction had a bid-to-cover of 3.12, dollar demand of $115.4 billion, and indirect bidder participation of 29.2%.

Advancing Sectors: Telecom (+0.9%), Utilities (+0.1%)
Declining Sectors: Financials (-1.2%), Industrials (-0.8%), Health Care (-0.8%), Materials (-0.7%), Consumer Discretionary (-0.6%), Consumer Staples (-0.5%), Energy (-0.4%), Tech (-0.2%)DJ30 -48.22 NASDAQ -11.45 NQ100 -0.6% R2K -0.4% SP400 -0.2% SP500 -6.51 NASDAQ Adv/Vol/Dec 1036/1.89 bln/1614 NYSE Adv/Vol/Dec 1260/919 mln/1706

3:30 pm : Oil prices closed pit trade flat at $76.52 per barrel after swinging from a gain in morning trade to an afternoon loss. As for natural gas, its price fell 2.6% to $3.02 per MMBtu. Stiff pressure weighed on the energy component for the entire session.

A quiet session left gold prices unchanged so that the yellow metal ended pit trade at $1298.60 per ounce. Silver settled 0.3% higher at $21.47 per ounce. Silver prices had extended their recent highs by hitting $21.65 per ounce in early electronic trade.

The CRB Commodity Index extended its eight-month high this session, though it settled just 0.2% for the better. DJ30 -6.93 NASDAQ -0.62 SP500 -1.18 NASDAQ Adv/Vol/Dec 1167/1.52 bln/1449 NYSE Adv/Vol/Dec 1516/609 mln/1447

3:00 pm : Only an hour remains before the toll of the closing bell and only a little more than a half billion shares have traded hands on the NYSE so far. The lackluster participation reflects the lack of interest on the part of traders amid this session's light news flow. It also reflects an uncertainty as it pertains to the direction of stocks. DJ30 -4.55 NASDAQ -0.81 SP500 -0.71 NASDAQ Adv/Vol/Dec 1144/1.42 bln/1481 NYSE Adv/Vol/Dec 1497/560 mln/1452

2:30 pm : The S&P 500 has stalled at the flat line. Resistance there has left it unable to put together any kind of a gain.

Telecom stocks continue to outperform, though. Steady buying in the sector has the group up 1.4%, collectively. Still, telecom's lack of weight has made it incapable of providing any legitimate leadership to the broader market -- the telecom sector represents just over 3% of the overall weight of the S&P 500.DJ30 +4.42 NASDAQ +2.85 SP500 -0.07 NASDAQ Adv/Vol/Dec 1197/1.29 bln/1383 NYSE Adv/Vol/Dec 1550/508 mln/1369

2:00 pm : Stocks have made a marked push higher in the past few minutes of trade, but there hasn't been any news item or catalyst to account for the recent flurry of buying. All three major averages are now at the neutral line.

Treasuries have held on to their gains in the face of the stock market's upturn. Volatility is still up, too.

Trade among currencies remains quiet as the dollar drifts along with a 0.1% loss against competing currencies. DJ30 +3.67 NASDAQ +0.78 SP500 -0.47 NASDAQ Adv/Vol/Dec 1156/1.18 bln/1421 NYSE Adv/Vol/Dec 1491/467 mln/1432

1:30 pm : Stocks are still stuck in the red and Treasuries continue to trade with strength as the 2-year Note is still up a single tick and the 10-year Note is now up close to a full point.

Results from an auction of 2-year Treasuries were released at 1:00 PM ET. They showed a bid-to-cover ratio of 3.78 amd dollar demand of $136.1 billion. Indirect bidders accounted for 39.0%. For comparison, the prior auction had a bid-to-cover of 3.12, dollar demand of $115.4 billion, and indirect bidder participation of 29.2%. The average of the past four auctions has a bid-to-cover ratio of 3.21, dollar demand of $125.8 billion, and an indirect bidder participation rate of 34.9%. DJ30 -18.17 NASDAQ -6.42 SP500 -3.26 NASDAQ Adv/Vol/Dec 994/1.08 bln/1555 NYSE Adv/Vol/Dec 1309/425 mln/1617

1:00 pm : Action has been both listless and lackluster all session. That has left the major equity averages to trade with modest losses.

A light flurry of selling pressure sent stocks lower immediately after the open as participants refused to let the S&P 500 extend above the fractionally extended multi-month high that was set this past Friday. Weakness, though moderate, has been widespread.

In contrast to broader market action, airline stocks have been strong following news that Southwest Air (LUV 13.80, +1.52) will acquire Air Tran Holdings (AAI 7.37, +2.82) for $7.69 per share, a 69% premium over AAI's closing price from Friday. Support in the space has the Amex Airline Index up 2.8% to its highest level in almost three years.

In other merger and acquisition activity, Alberto-Culver (ACV 37.77, +6.29) will be acquired by Unilever for $37 per share, which represents a premium of about 17% over ACV's closing price from last week.

Among the major sectors in the S&P 500 only telecom has managed to put together any real gain. The sector is currently up 1.0% amid leadership from Sprint Nextel (S 4.61, +0.17).

Two of the three largest sectors by weight, financials (-0.6%) and health care (-0.7%), have been under steady pressure, while tech, which is the largest sector, has spent the session near the neutral line.

Even though overall losses have been contained, the Volatility Index is up more than 4%. That comes after it dropped 9% during the stock market's rally this past Friday.

An increase in volatility and losses in the stock market have propped up Treasuries ahead of results from an auction of 2-year Notes at 1:00 PM ET. The yield on the 2-year Note currently stands just above 0.42%, while the benchmark 10-year Note's yield is down to 2.52% and the yield on the 30-year Bond is just above 3.70%. DJ30 -25.74 NASDAQ -8.95 SP500 -4.04 NASDAQ Adv/Vol/Dec 924/991 mln/1623 NYSE Adv/Vol/Dec 1231/387 mln/1674

12:30 pm : The Volatility Index is up more than 4% this session. The jump comes even though broader market losses remain relatively modest.

Still, the health care sector, which is the third largest by market weight, is down a marked 0.7% and the widely-watched financial sector, which is the second largest sector by market weight, is down 0.6%. Tech, the largest sector, is down just 0.1%, though. DJ30 -24.68 NASDAQ -9.70 SP500 -4.22 NASDAQ Adv/Vol/Dec 892/920 mln/1635 NYSE Adv/Vol/Dec 1209/360 mln/1683

12:00 pm : The 10-year Treasury Note is up a strong 23 ticks at the moment. That has its yield back down to 2.52%. Meanwhile, the 30-year Bond is up about 1.5 points, which has taken its yield down to just below 3.71%.

As for stocks, listless and lackluster trade continues to keep the major averages in negative territory. DJ30 -29.45 NASDAQ -8.51 SP500 -4.25 NASDAQ Adv/Vol/Dec 916/816 mln/1578 NYSE Adv/Vol/Dec 1222/320 mln/1655

11:30 am : Stocks recently swung to fresh session lows, but they have since recovered a bit so that overall losses remain modest.

Airline stocks are having a strong session in the face of lackluster trade in the broader market. Strength in the space, mostly underpinned by news that Air Tran (AAI 7.30, +2.74) will be acquired by Southwest Air (LUV 13.40, +1.12), has the Amex Airline Index up 2.4% to its highest level in almost three years. DJ30 -24.34 NASDAQ -8.18 SP500 -3.61 NASDAQ Adv/Vol/Dec 944/718 mln/1516 NYSE Adv/Vol/Dec 1253/278 mln/1608

11:00 am : The Dow recently poked into positive territory, but it failed to sustain the move. In turn, the three major indices continue to chop along in negative territory. Losses are still slight in sized, though.

Telecom stocks have jumped out to a 0.6% gain. That's double the gain of the next best performing sector, which is utilities (+0.3%). Telecom continues to be led by Sprint Nextel (S 4.59, +0.15), but integrated telecom giant and Dow component Verizon (VZ 32.99, +0.35) is also up nicely. Within the market Verizon carries more influence than Sprint since Verizon's market cap is more than six times greater than that of Sprint. DJ30 -5.95 NASDAQ -4.97 SP500 -1.46 NASDAQ Adv/Vol/Dec 1027/569 mln/1385 NYSE Adv/Vol/Dec 1396/228 mln/1419

10:30 am : A smaller rally in the dollar index pushed it back near the unchanged line, which pressured select commodities.

About 20 minutes after this small rally, December crude oil fell from session highs of $77.17 per barrel, into negative territory. Crude hit new session lows again of $75.71 per barrel minutes ago, and is trading just above that level now at $75.91 per barrel, down 0.6%.

December natural gas has been in the red all session so far and has also traded in a narrow range. The energy component put in new session lows of $3.75 per MMBtu minutes ago and is currently sitting at that low, down 3.4%.

Precious metals have pulled back in recent trade due to strength in the dollar index. Both December gold and December silver fell into negative territory and are just below the unchanged line at $1296.60 per ounce and $21.39 per ounce, respectively.DJ30 -6.29 NASDAQ -3.52 SP500 -1.33 NASDAQ Adv/Vol/Dec 998/428.4 mln/1362 NYSE Adv/Vol/Dec 1292/178.8 mln/1466

10:00 am : Stocks have stabilized since their opening slip, which came amid immediately after the open of trade as stocks continue to have difficulty helping the S&P 500 extend past the 1150 line.

While energy stocks (unch.) have surrendered their opening gains, tech stocks (+0.1%) and telecom stocks (+0.3%) have made their way into the green. Jabil Circuit (JBL 13.86, +0.29) is a leader among tech issues ahead of its quarterly earnings announcement tonight while Sprint Nextel (S 4.59, +0.15) is a leader among telecom plays.

Advancing Sectors: Telecom (+0.3%), Tech (+0.1%)
Declining Sectors: Health Care (-0.6%), Industrials (-0.5%), Financials (-0.5%), Consumer Discretionary (-0.5%), Materials (-0.4%), Consumer Staples (-0.3%), Utilities (-0.1%)
Unchanged: EnergyDJ30 -21.08 NASDAQ -7.70 SP500 -3.34 NASDAQ Adv/Vol/Dec 824/269 mln/1410 NYSE Adv/Vol/Dec 1032/118 mln/1665

09:45 am : Stocks were slapped with some selling shortly after the open. That has the major equity averages down modestly in the early going.

Though tame, the opening slide has been broad, such that energy stocks make up the only sector in the S&P 500 to trade in positive territory. The sector's 0.2% gain comes largely in response to buyng among oil and gas explorers (+0.4%) and oil and gas drillers (+0.4%). DJ30 -19.00 NASDAQ -6.83 SP500 -2.56 NASDAQ Adv/Vol/Dec 795/165 mln/1381 NYSE Adv/Vol/Dec 1076/81 mln/1574

09:15 am : S&P futures vs fair value: +1.10. Nasdaq futures vs fair value: +0.50. Stock futures now suggest that the week's opening session will get a slightly higher start. The generally quiet action of premarket trade comes amid an absence of any real catalysts capable of convincing traders to take on meaningful positions after stocks set fresh multi-month highs on Friday. There are no major economic releases scheduled for today and corporate news remains limited to a couple of small merger and acquisition items - the buyout of Alberto-Culver (ACV) by Unilever and the acquisition of Air Tran (AAI) by Southwest Air (LUV). Later today (1:00 PM ET) participants get results from an auction of 2-year Treasury Notes, though. The 2-year continues to trade flat. Currencies also trade quietly, although the dollar has dipped to a 0.2% loss in recent trade.

09:00 am : S&P futures vs fair value: +1.70. Nasdaq futures vs fair value: +1.50. Stock futures are slightly higher from earlier levels. Meanwhile, commodities are generally higher as the CRB Commodity Index is up 0.4% to a new eight-month high. Oil prices have climbed 0.8% to $77.10 per barrel in the opening minutes of pit trade and natural gas prices drop 3.0% to $3.77 per MMBtu. Precious metals are up as gold trades with a 0.1% gain at $1298 per ounce and silver trades 0.5% higher at $21.50 per ounce.

08:30 am : S&P futures vs fair value: +0.10. Nasdaq futures vs fair value: -0.80. Futures for the S&P 500 are still flat. Meanwhile, Germany's DAX is up 0.1% at the moment. Adidas is atop the list of leaders while Merck KGAA is a laggard at the moment. France's CAC is flat even as its advancing issues take a 3-to-2 edge over declining issues. Advancers are currently led by Total (TOT) and BNP Paribas, but Sanofi Aventis (SNY) and Carrefour have been a drag. Britain's FTSE has slipped to a 0.1% loss. Unilever is a leader amid news that it will acquire Alberto-Culver (ACV). HSBC (HBC) has hampered action, however.

Overnight action in Asia was impressive as the Shanghai Composite climbed 1.4% to catch up with the strong gains made by the U.S. averages this past Friday. Industrial & Commercial Bank, Bank of China, and Ping An Insurance were leaders. Losses were limited, but Industrial Bank, Bank of Communications, and China Merchant Bank were notable names among the session's declining issues. According to some of the latest data, industrial profits in China increased 55% in August. They were up almost 82% in the same month of the previous year. The Leading Index for August came in at 101.9, essentially unchanged from the 102.1 that was recorded for July. In Hong Kong, the Hang Seng advanced 1.0%. HSBC was a primary leader. Tencent Holdings aided the advance. China Construction Bank and China Life Insurance were laggards. As for Japan, its Nikkei advanced 1.4%. Fanuc LTD, Kyocera (KYO), and Honda Motor (HMC) led the way, while Fast Retailing cast a weight on trade.

08:00 am : S&P futures vs fair value: +0.20. Nasdaq futures vs fair value: -1.50. A dearth of headlines has stock futures flat at the moment. Corporate news flow is largely limited, such that the only items of broad interest are news that consumer staples outfit Alberto-Culver (ACV) will be acquired by Unilever for $37 per share, a premium of about 17% over ACV's closing price from last week, and Southwest Air (LUV) will acquire Air Tran Holdings (AAI) for $7.69 per share, a 69% premium over AAI's closing price from Friday. There are no major economic releases scheduled for today, but results from an auction of 2-year Treasury Notes are due at 1:00 PM ET. The 2-year Note is currently flat, but Treasuries at the long end of the yield curve are attracting support. Currencies are trading quietly and Europe's major bourses are moving in mixed fashion. Asia's averages booked sharp gains overnight as they followed the strong finish had by U.S. stocks in their final session of last week.

06:30 am : S&P futures vs fair value: -1.20. Nasdaq futures vs fair value: -3.00.

06:30 am : Nikkei...9603.14...+131.50...+1.40%. Hang Seng...22340.84...+221.40...+1.00%.

06:30 am : FTSE...5596.03...-2.50...-0.10%. DAX...6307.77...+9.30...+0.20%.

Special thanks to Bloomberg, CNNMoney and Yahoo! Finance for their market summaries. gm

Best Regards,
M.A. Perry
Trader and Founder of WRB Analysis (wide range body analysis)
Image@ http://twitter.com/wrbtrader and http://stocktwits.com/wrbtrader

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