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After more than 40 years on Wall Street, Marc Chaikin founded Chaikin Analytics LLC in 2009 to deliver proven stock analytics to financial service professionals and individual investors. With the Chaikin Power Gauge, an alpha-generating quantitative model as its centerpiece, Chaikin Analytics... More
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  • Economy Stalls But Markets Shrug It Off To Make New Highs
    Stock Market Ideas and AnalysisBy Marc Chaikin

    The S&P 500 Index closed on Friday at 2,122.73 up 0.31% on the week with the only selling pressure coming from Tuesday's pre-opening stock index futures trading, triggered by another sharp uptick in bond yields in Europe. The equity markets recovered, however, to close on Tuesday with a modest 0.3% loss, and spent the balance of the week moving higher.

    Having recovered from another sovereign debt yield-induced swoon, the market, led by the multi-national large cap stocks currently benefiting from a weaker U.S. dollar, made another new all-time high.

    The question in most active investors' minds is: can the market finally break out above the tight trading range that has defined the past 6 months of market activity? In spite of the ease with which the market made new highs on Thursday and Friday, there is the reality of soft economic reports and the possibility of a 2nd quarter of GDP growth below 2%. For those looking for the most reliable forecast of U.S. economic growth, the Atlanta Federal Reserve Board has had a stellar record of predicting GDP of late and is currently projecting 2nd quarter GDP growth of only 0.7%.

    Although we remain constructive regarding the stock market's ability to gain an additional 5-10% in 2015, the selling in bonds that keeps roiling the markets will probably be with us for the time being as hedge funds are constrained by a lack of liquidity in the U.S. Government Bond market.

    The most interesting data point of the week for me came not from the stock market but from the New York City spring art auctions which brought staggering prices for blue chip art. Spikes like this have been seen before, in 1990, 2007 and 2011. These were all followed by market swoons of 20-60%, but the timing was not precise.

    Click Here for more stock market tips and Marc Chaikin's weekly Stock Market analysis.

    Disclaimer: Chaikin Analytics LLC is not registered as a securities broker-dealer or advisor either with the U.S. Securities and Exchange Commission or with any state securities regulatory authority. Chaikin Analytics does not recommend the purchase ofany stock or advise on the suitability of any trade. The information presented is generic in nature and is not to be construed as an endorsement, recommendation, advice or any offer or solicitation to buy or sell securities of any kind, but solely as information requiring further research as to suitability, accuracy and appropriateness.

    Users bear sole responsibility for their own stock research and decisions. Read the entire disclaimer.

    © 2015 Chaikin Analytics, LLC. All rights reserved.

    May 18 3:00 PM | Link | 1 Comment
  • German Bund Yields Drove Stock Prices Down… And Then The Market Didn't Care
    Stock Market Analysis and ideas by Marc Chaikin

    The S&P 500 Index closed on Friday at 2,116.10 up 0.37% on the week after trading down to the top of the support zone at 2,070. Since we have been in such a tight trading range, the decline to support, driven by a sharp increase in German Bund yields pushed the stock market to a short-term oversold condition. The subsequent rally on Friday, based on a Goldilocks non-farm payroll report (not too cool and not too hot), saw the market close at the upper end of its recent trading range, missing a new closing high by less than a point.

    Although the market is now over-bought on a short-term basis, last week's price action was very constructive. We are working through the early to mid-May seasonally weak period with very little price damage, except in the Biotech and Internet groups, and are well positioned to breakout to new highs. As always, there is no need to chase stocks as nervous traders have created higher volatility and we may see more 2 day swoons ahead.

    The market traded poorly all week as it reacted to a sharp 50 basis point rise in German sovereign debt yield, which also pushed 10 year U.S. Treasury yields above 2.3% very briefly on Wednesday. Federal Reserve Board Chairman Janet Yellen added fuel to the bearish fire by proclaiming that, "equity market valuations at this point are generally quite high". This is reminiscent of Alan Greenspan's irrational exuberant pronouncement in 1996 that sparked at a sharp sell-off in early 1997 after the Fed raised rates. It is well to note that the internet boom stayed alive for another 4 years.

    Although Federal Reserve Board officials, IMF prognosticators and economists in general have a notoriously bad track record at calling stock market peaks and troughs, the stock market reacts none-the-less.

    The fact that we ended the week higher in a historically bullish pre-election year bodes well for further advances in 2015. Expect an ultimate peak 5-10% above current levels on the S&P 500 Index, with upside targets in the 2,220 - 2,350 area. However until we get through late-May and early-June, we may still experience bumps in the road, something we alluded to back in January.

    We will still see the market held hostage to the specter of the first interest rate hike from the Fed, which historically has been bullish not bearish as it confirms a strengthening economy. Ignore these fear-inducing headlines as they are a distraction from the business of making money in your portfolio.

    Click Here for more stock market ideas and analysis from Marc Chaikin.

    Disclaimer: Chaikin Analytics LLC is not registered as a securities broker-dealer or advisor either with the U.S. Securities and Exchange Commission or with any state securities regulatory authority. Chaikin Analytics does not recommend the purchase ofany stock or advise on the suitability of any trade. The information presented is generic in nature and is not to be construed as an endorsement, recommendation, advice or any offer or solicitation to buy or sell securities of any kind, but solely as information requiring further research as to suitability, accuracy and appropriateness.

    Users bear sole responsibility for their own stock research and decisions. Read the entire disclaimer.

    © 2015 Chaikin Analytics, LLC. All rights reserved.

    May 12 9:48 AM | Link | Comment!
  • Stocks Stay Locked In Trading Range – Fail To Follow Through On Previous Week's Strength

    Stock Market Analysis and Stock Ideas by Marc Chaikin

    The S&P 500 Index closed on Friday at 2,108.29, down 0.44% on the week after making a new all-time high on Monday. The market traded poorly all week as it reacted negatively to poor economic reports and disappointing earnings reports from key social media stocks like Twitter (NYSE:TWTR), Yelp (NYSE:YELP) and LinkedIn (NYSE:LNKD).

    Profit taking in the previously strong Health Care and Biotech stocks was also a drag on the market. On Friday, the market rallied sharply with the large cap S&P 500 stocks leading the charge while the market absorbed continued selling pressure in the high multiple social and cloud computing stocks.

    The market made new highs early in the week led by the S&P 500 and the Nasdaq Composite, but finished the week lower with the real damage seen in the Russell 2000 small cap stocks and the high p/e multiple stocks in the social media, biotech and cloud computing groups.

    Very strong earnings reports from Gilead Sciences (NASDAQ:GILD) and our featured bullish Stock of the Week, AmerisourceBergen (NYSE:ABC)which guided sharply higher, show that Health Care companies are still thriving, even as profit-taking dominated the trading action. The consensus is that a weak U.S. dollar has made the domestic revenue-centric Health Care sector ripe for profit taking. That is also the rational for the weakness in small cap stocks.

    The bottom line is that we remain locked in the upper 1/2 of the trading range for the past 6 months. The low end of that range is 1,973 on the S&P 500 Index; the upper end is 2,125. Support exists at 2,040 - 2,070. A 5% decline from Monday's high would take us down to the 200-day average price of 2,027.

    Given the market's propensity to sell-off in the early part of May, expect a further pull-back from resistance at 2,120 and keep your powder dry. Look for renewed weakness in the Health Care andConsumer Discretionary stocks with Bullish or Neutral+ Chaikin Power Gauge ratings as a buying opportunity over the next 3 weeks.

    click here for more stock market ideas and analysis from Marc Chaikin.

    Disclaimer: Chaikin Analytics LLC is not registered as a securities broker-dealer or advisor either with the U.S. Securities and Exchange Commission or with any state securities regulatory authority. Chaikin Analytics does not recommend the purchase ofany stock or advise on the suitability of any trade. The information presented is generic in nature and is not to be construed as an endorsement, recommendation, advice or any offer or solicitation to buy or sell securities of any kind, but solely as information requiring further research as to suitability, accuracy and appropriateness.

    Users bear sole responsibility for their own stock research and decisions. Read the entire disclaimer.

    © 2015 Chaikin Analytics, LLC. All rights reserved.

    May 06 10:55 AM | Link | Comment!
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