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MyHappyTradingTM is a social network site with a focus on the global financial markets. It is an online community where you can share your thoughts and your investment/trade ideas with the community and the network that you build. Our Basic Membership is FREE. MyHappyTradingTM provides you the... More
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  • Weekly Wrap-Up + Market Forecast + Sector Watch: SOXX, NFLX, CMG, PNRA, PCLN, GS, APA, EOG, IOC, HES, DVN, WLT, CLF, ANR, BTU, ACI, X, NUE, AKS, FCX 0 comments
    May 16, 2011 2:17 AM | about stocks: UUP, XME, XLE, XLF, SOXX, NFLX, CMG, PNRA, PCLN, GS, APA, EOG, IOC, HES, DVN, WLT, CLF, ANR, BTU, ACI, X, NUE, AKS, FCX

    Last weekend, in my Market Forecast, we discussed:

    "For the new week, although many earnings are still coming in, I think we can start to focus more on the broader market movement.  What happened last week was the most prominent signal, yet, of the switch from commodity cycle to the multi-year super-cycle of techs.  I have mentioned this more than a few times, and, the process continues.  CSCO reports on Wednesday after market and I think as long as CSCO provide a relatively good quarter (comparing to its past 4 quarters), the market will have a positive reaction.  Mobile internet and all its derivative sectors should become more and more the focus, for the next few years to come.  The market could stay range bound, at least to start the week.  On the upside, SPX needs to break above 1360 to break out, while Nasdaq's resistance is at 2875.  On the downside, support at SPX 1320 will be very important."

    It sure was a volatile week, and the market did stay range bound, ending the week basically unchanged.  On Monday and Tuesday, the market tried to bounce.  But, by the end of Wednesday, all of the gains from the previous 2 days were lost.  The selloff in commodities continued.  After the market on Wednesday, CSCO disappointed again with its forecast.  Techs staged a bounce on Thursday, only to lose it all by Friday's close.

    We didn't trade too much last week, but, did get on some downside plays, including a +103% gain on MOS puts:
    08:46 | HappyTrading IBM ($170.25) Sold to Close 05C170 May 170 calls, at $1.60 -31%
    07:13 | HappyTrading MOS ($66.30) Sold to Close 05P70 May 70 put, at $4.30 +103%
    11:48 | HappyTrading BIDU ($139.00) Sold to Close 05P140 May 140 put, at $3.90 +7%
    11:36 | HappyTrading BIDU ($138.50) Sold to Close 05P140 May 140 put, at $4.20 +15%
    09:03 | HappyTrading APA ($124.30) Sold to Close 05C130 May 130 calls, at $2.15 -50%
    07:28 | HappyTrading WYNN ($150.95) Sold to Close 05C150 May 150 calls, at $3.70 +61%
    12:42 | HappyTrading WYNN ($149.85) Sold to Close 05C150 May 150 calls, at $3.10 +35%

    For the week, the Dow was down 42.99 points; SPX fell 2.25 points (closing with 1340); Nasdaq actually ended 0.91 point higher!  Both oil and gold were little changed.  At the time of this writing, Asian markets were mostly lower.  Here are where the US markets stand after Friday's close:

    SPX

    SPX fell 10.88 points to close at 1337.77.  It closed at its 30-day MA, but, below 1340.  The MACD slipped.

    Nasdaq

    Nasdaq lost 34.57 points to close at 2828.47, above 2825.  It closed at its 20-day MA.  The MACD was slightly lower.

    SPX closed below 1340 last week, while Nasdaq managed to close above its support at 2825, but, only barely.  The surprising thing was that VIX actually went lower!  VIX closed only slightly above 17.  For the new week...

    To read the rest of this article, please subscribe to HappyTrading "Premium Articles" by going to the Premium Services (click here) page.  If you are already a subscriber, please click here: Market Forecast 5/15/11.

     Sign up for FREE membership!

    Stocks: UUP, XME, XLE, XLF, SOXX, NFLX, CMG, PNRA, PCLN, GS, APA, EOG, IOC, HES, DVN, WLT, CLF, ANR, BTU, ACI, X, NUE, AKS, FCX
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