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A Golden Swing
Marc Sperling of T3Live
I am buying some gold right here (through the GLDs) looking for an initial target in the $113 area. If it takes out the $113 area, there this precious metal could easily move up to $115.
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Set The Clock: The Text Of The Healthcare Bill Is Now Up, And There’s 72 Hours To Vote On It
Joe Weisenthal of Business Insider
If you think 24 is exciting, this is going to be three times as exciting!
That’s because starting right now (or, like, an hour ago) The House posted the full text of the healthcare bill it will be voting on, thus starting a 72-hour mad dash to get it voted on.
It’s going to be a wild Sunday in Washington DC. And don’t even ask us what’s in it.
Actually, please volunteer to take 10 pages and tell us what you find in the comments. Go!
BULL VERSUS BEAR: JIM VERSUS JIM
Courtesy of The Pragmatic Capitalist
James Barty from Arrowgrass Capital Partners says investors should continue buying the dips as stocks continue climbing the wall of worry. Meanwhile, Jim Rogers says we are on the verge of another recession.
Bull:
Bear:
Source: CNBC
PALM Trading Up 4%
PALM is currently trading up 4% today. What to look out for out of PALM in the future 
*More distribution deals with carriers outside of US
*‘Killer-apps’ for WebOS *Further out, WebOS in other form factor (other forms of devices apart from cellphones)
*Possible deals with media companies coming down the pipe I don’t think Palm will just go away.
If things get too bad, Nokia would probably snap them up and roll their tech into their MeeGo initiative. That wouldn’t be the worst thing in the world; WebOS UI, with Moblin’s speed, and Nokia’s reach and QT dev platform. Market Club has an interesting take on how thing will play out with PALM in this FREE Stock Analysis Report Here. Price Target $8.50.
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Zero inflation in February
The Labor Department reported zero inflation for the month of February as rising prices for medical care and education were offset by sharply lower costs for energy and apparel. This comes after a 0.2 percent increase in January and marks the eleventh straight month that the price index did not drop after a series of steep declines beginning in late-2008.
On a year-over-year basis, the overall consumer price index was up 2.2 percent following an annual gain of 2.7 percent the month before, however, we may not have seen the last of rising annual inflation as recently higher gasoline prices are not reflected in the most recent data.
Energy prices were down 0.5 percent in February after an increase of 2.8 percent the month prior and are now 14.4 percent higher than a year ago. Last month, gasoline prices fell 1.4 percent but they are still almost 37 percent higher than last year at this time.Recall that gasoline prices did not move much above the $2 a gallon mark last year until May, so there will be a few more months of big energy price increases in the period ahead.
AIG Holding Support Here
AMERICAN INTL GROUP INC (NYSE:AIG)
Smart Scan Chart Analysis confirms that a strong uptrend is in place and that the market remains positive longer term. Strong Uptrend with money management stops. A triangle indicates the presence of a very strong trend that is being driven by strong forces and insiders. More AIG info here.
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Time to be VERY VERY Selective
Scott Redler of T3Live
The S&P 500 tagged 1,170 yesterday and then sold off a bit. My target zone for this market back when “the wedge” resolved to the upside was 1,170-1,190. So, with the overbought nature of this market, the setup must be REALLY good to take. The market still feels like higher prices are in store, but if you are sitting on some big gains, I would recommend going out a few months and selling some calls to protect positions and collect some premium.
The Rundown:
Tech:
- Apple (AAPL)–great trade for us above $202 and again above $210.50 and $215.50. Now it’s building a new base between $221 and $227. No “real” setup just yet.
- Amazon (AMZN)–this too is resting after its juicy buy at around $121. The stock needs more time to trade its new range.
- Baidu (BIDU)–is a monster! It had its first two down days, but nothing drastic. No setup here.
- Google (GOOG)–gave us some small trades. Now with the news that it might actually leave China, it could stay under pressure. Watch the gap in front of it for a tell.
- Research in Motion (RIMM)–gave us three days of nice action after the breakout of $72.10. Now it’s acting sluggishly. I am flat it and will avoid for the time being.
- Intel (INTC)–this gave us the move we wanted through $20.80 and $21.50. I have a small mount left, as it could work its way to $23ish.
- Microsoft (MSFT)–is lagging and it could play catchup if it wants to. This needs high volume to ignite through $27.70.
- Cisco (CSCO)–this had its stretch before the product release. Now it’s creating a bull flag and could push through $26.50.
Financials–Big move here! If you can’t sell some, sell some in the money calls to protect gains and add a little value.
- Goldman Sachs (GS)–great trade through $160, with some follow-through extension that took it further than I would have thought. It had a doji close and is overbought. They might try to close it at around $175 for options expiration tomorrow.
- JP Morgan (JPM)–met all our long expectations. I’m flat now.
- Bank of America (BAC)–still inching higher but not compelling right now.
- Wells Fargo (WFC)–since our buy at $27.60 this one has come a long way. I now sold some.
- General Electric (GE)–gave us a GREAT three-day move. I took the trade and actually got short some yesterday–just for a trade–big open interest at $17.50 here.
- Freeport McMoran (FCX)–is lagging the indices, but had a nice move before that. Nothing here right now. Negative candle yesterday could take this a bit lower.
- U.S. Steel (X)–ugly reversal after a move from the lows. The meat of this up move is over in my opinion.
- Alcoa (AA)–we went a note to get involved at $14. It could continue higher today and play some more catchup.
- Gold (GLD)–I am personally long. THE PATTERN IS STARTING TO LOOK BETTER TO ME. I think everyone NEEDS TO BE LONG SOME GOLD. Add if it can get above $1,150 and stay there.
- AIG (AIG)–I hate this stock, but there is a decent bull flag setup. I will buy for a trade if it can slice through $36-36.50 with VOLUME.
- I’m long tier two in the casinos–WYNN, LVS AND MGM–they are in a conference today and could see some news-flow.
- Retail has been a MONSTER, but I don’t really trade those names.
The bottom line is: the time to get excited and get heavy was weeks ago. Now is the time to play a bit of defense and be very selective about the trades you take–both long and short.
28 Day Sector Rotation, Commodity & Index Update
Earlier this week I noticed a pattern in the market throughout an entire trading session that has inspired me to write a short piece on sector rotation.
On Tuesday March 16th, my quote screen was flashing green as sectors reached new intraday highs or 52 week highs. The interesting part was that every sector that was flashing green happened to be in sectors that strengthen at the end of a bull market cycle or strong rally. This would include basic materials, staples, services, utilities and financial.
Today I investigated the different sectors and came across some interesting numbers between the January market peak and this week’s price action as I show in the charts below.
JANUARY – ETF Sector Rotation Trading – 28 Day Cycle
I may not explain this well but try to follow me here 
Just before the market rolled over and lost over 9% last January, all the proper bull market sectors were very strong during the previous 28 days. This is normal and a strong sign that market participants were bullish on the overall market.
But the market was overbought; trading volume was light indicating that not many people are willing to buy at these lofty prices. And the VIX (volatility index) had reached an extreme low (a level that has triggered large sell offs in the past). All this means one thing to me. And that is, trade with caution and tighten your protective stops.
General rule, if everyone is buying all the hot stocks at these over bought levels then you can’t help but think its time for the market to roll over and shake them all out.
MARCH – ETF Sector Rotation Trading –28 Day Cycle
The chart of March shows where the sectors have finished over the past 28 days. Notice how similar the sectors have appreciated in price…
I have overlaid John Murphy’s sector rotation image to show which sectors are strongest in a bull market.
Now the interesting part is that it appears to be the setup as in January. My quote system is flashing new highs for the bear market cycle sectors which are the one which have not performed well (Stapes, Services & Utilities) and I have to think the market is about to take a breather or do a swan dive.
Don’t get me wrong, I am not saying we are on the verge of a bear market. I actually think the market is strong and will trade sideways in a large range for most of this year or just continue to trend up.
What I am saying is that these sectors go in and out of favor during smaller market cycles and that can be very useful information.
Sector Rotation Explained
You can learn more about sector rotation from this detailed course How to Profit From Sector Rotation Using ETFs. This course explains how different sectors are stronger during different points within the economic cycle. The chart above shows the relationships and which of the various sectors should strengthen from the economy. The financial Market Cycle leads the Economic Cycle because traders try to anticipate the economy.
Market Update & Trading Conclusion:
Stock Indexes: The market in my opinion is way over bought on the daily chart and needs a breather. Volume is light, VIX is at the same level we saw in January just before the top and the bullish sectors are firing on all pistons. You won’t catch me buying up here. Any type of pullback will most likely be sharp and there is no need to put money to work right now.
Precious Metals: Gold and silver had a nice pop this week off of a support level. I did not have a low risk setup as momentum was not on my side at the time of the pop. Also the large gap up on GLD makes me nervous as gaps tend to get filled. I am just waiting for something to unfold which looks to be a few days away still.
Oil: It has popped higher also and is trading at resistance. As I mentioned in Sundays report, if the USD dollar completes this breakdown then we will see commodities and stocks surge to higher prices and most likely post a nice multi month rally.
Natural Gas: We are seeing natural gas prices dip below support, shaking out traders who had their protective stops set just beneath the previous low. Natural gas is a silent killer as it will shake even the best traders out of the market. I feel natural gas is over sold and ready for a bounce but until I get a low risk setup I remain on the side lines.
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Chris Vermeulen
www.TheGoldAndOilGuy.com
Now Bernanke Wants To Eliminate Reserve Requirements Completely
Michael Snyder of Cluster Stock
(This post appeared at The Economic Collapse.)Up until now, the United States has operated under a “fractional reserve” banking system. Banks have always been required to keep a small fraction of the money deposited with them for a reserve, but were allowed to loan out the rest. But now it turns out that Federal Reserve Chairman Ben Bernanke wants to completely eliminate minimum reserve requirements, which he says ”impose costs and distortions on the banking system”. At least that is what a footnote to his testimony before the U.S. House of Representatives Committee on Financial Services on February 10th says. So is Bernanke actually proposing that banks should be allowed to have no reserves at all?
That simply does not make any sense. But it is right there in black and white on the Federal Reserve’s own website….
The Federal Reserve believes it is possible that, ultimately, its operating framework will allow the elimination of minimum reserve requirements, which impose costs and distortions on the banking system.
If there were no minimum reserve requirements, what kind of chaos would that lead to in our financial system? Not that we are operating with sound money now, but is the solution to have no restrictions at all? Of course not.
What in the world is Bernanke thinking?
But of course he is Time Magazine’s “Person Of The Year”, so shouldn’t we all just shut up and trust his expertise?
Hardly.
The truth is that Bernanke is making a mess of the U.S. financial system.
Fortunately there are a few members of Congress that realize this. One of them is Republican Congressman Ron Paul from Texas. He has created a firestorm by introducing legislation that would subject the Federal Reserve to a comprehensive audit for the first time since it was created. Ron Paul understands that creating money out of thin air is only going to create massive problems. The following is an excerpt from Ron Paul’s remarks to Federal Reserve Chairman Ben Bernanke at a recent Congressional hearing….
“The Federal Reserve in collaboration with the giant banks has created the greatest financial crisis the world has ever seen. The foolish notion that unlimited amounts of money and credit created out of thin air can provide sustainable economic growth has delivered this crisis to us. Instead of economic growth and stable prices, (The Fed) has given us a system of government and finance that now threatens the world financial and political institutions. Pursuing the same policy of excessive spending, debt expansion and monetary inflation can only compound the problems that prevent the required corrections. Doubling the money supply didn’t work, quadrupling it won’t work either. Buying up the bad debt of privileged institutions and dumping worthless assets on the American people is morally wrong and economically futile.”
The truth is that the financial system that we have created makes inflation inevitable. The U.S. dollar has lost more than 95 percent of the value that it had when the Federal Reserve was created. During this decade the value of the dollar will decline a whole lot more.
That doesn’t sound like a very good investment.
But that is what happens when you give bankers power to make money up out of thin air.
And things are only going to get worse.
Especially if Bernanke gets his way and reserve requirements are eliminated entirely.
The U.S. economy is a giant mess already, and we have got a guy at the controls who simply does not have a clue.
It’s going to be a rough ride.
