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HSL Junior ---January 15, 2006--- info@hsletter.com
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*FOR
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DJ World Index DJ World Index closed Friday Nov 25 at 230.09, ie up 2.94 on the week. DJ World Index weekly chart - basis line on close:
DJ World Index daily chart - basis line on close:
Note:
free online charts of DJWI available via: www.bigcharts.com Dow Industrial vs. Dow Transportation
Transports: gave lead signal of strength via explosive rise above top boundary resistance of 12-month 3360-3832 trading zone; 4418 provisional upside target. Spinner & MACD in new positive cross above zero & placed to confirmed sustained strength. Chart bullish. Basis Dow Theory, a decisive rise above 11,000 in industrials is required to confirm the upside breakout in transports & validate a new bull cue. If seen, recent trading range activity in both indexes may provide footing for a sustained & determined rally leg. S&P500 Index S&P500 Mar futures closed Friday Nov 25 at 1278.30 ie, up 20.20pts on the week. The Commitment of Traders report shows S&P500 commercial hedgers reduced 375 longs, bringing total longs to 462,553, whilst shorts reduced 703 contracts, bringing total shorts to 467,543. Large speculators are holding 59,621 longs against 67,365 shorts. And, small traders are holding 129,783 longs against 117,049 shorts. Bullish
Consensus shows S&P 500 at 70%. Says: "S&P 500 futures
are moving sideways/higher in a test of short-term overhead resistance.
The S&P500 (continuation Cx) weekly chart - line on close:
S&P 500 Mar futures daily chart - line on close:
FMU Traders Guidelines: Per FMU Sept 25: gamblers exited Dec longs with loss :-(. Took profits at 1st target in Dec shorts & exited 2nd ½ via trailing profit stop :-). Per HSL 650: traders bought Dec at 1250.20 or better. Stocks in run-away upside mode & likely to stay strong as we head into the mid Dec-mid Jan period, which is habitually the most positive period of the year for stocks. If out, buy Mar after a pullback that holds on or above 1240-1254 closing support band (gamblers buy at 1254); sell ½ at 1284, ½ at 1294. Sell, or sell short (toehold) on 1-dc below 1224; stop: 1-dc over 1255. Cover ½ at 1192 & use trailing stop on rest. And/or sell short a rally that clearly stops below 1295-1300 resistance; stop: 2-dc over 1300. Cover ½ at 1254, ½ at 1240. NOTE: Traders are advised to use mini S&P's to enter/exit trades incrementally. 1 mini Cx = $50/point, compared with $250 for full size Cx (5 minis = 1 full size). Nasdaq Nasdaq (mini) Mar futures closed Friday Nov 25 at 1720.50 ie, up 21.50pts on the week. Nasdaq Composite weekly breadth figures show new highs almost tripled new lows (305-105), advances crushed declines (2050-1190) & advancing volume outpaced declining volume by a healthy ration of 1.82 to 1. Nasdaq Composite (continuation Cx) weekly chart - line on close:
HSLP-Nasdaq chart (HSLP = our in-house mkt predictor) line & bar:
Nasdaq (mini) Mar futures daily chart - line on close:
FMU Traders Guidelines: Per FMU Sept 25: exited Dec shorts via trailing profit stop :-). Took profits on 1st ½ Dec longs :-); exit 2nd ½ at mkt (or apply tight trailing stop). Per HSL 650: exited Dec shorts with loss L. Traders then bought Dec at 1632; take full profits at mkt (or apply tight trailing stop). If out, buy Mar Cx after a pullback that clearly holds on or above 1660-1675 closing support. Sell ½ at 1712 (if buy low) & use trailing profits stops on rest. Sell, or sell short (small size) on 2-dc below 1640; stop: 1-dc over 1675. Cover ½ at 1595, ½ at 1566. Market Sentiment Indicators AAII Index shows 57.3% bulls (up firmly from 53.6% of 2 weeks ago), 16.0% bears & 26.7% neutral. Market Vane Bullish Consensus at 69%, up from 64% of 2 weeks ago & 63% of 3 weeks ago. UBS Index of Investor Optimism (Overall Index) rose to 47 in Oct vs. 34 in Sept & 61 in Aug.
Platinum
& Precious Metals Index +43.93% Automobiles
Index -12.14% 10-Year T-Note 10-Year T-Note Mar futures closed Friday Nov 25 at 109^03, ie up 0^16 on the week. 10-Year T-Note Mar futures daily chart - line on close:
FMU Traders Guidelines: Per FMU 9/30: took profits at both targets in Dec shorts :-) Active/shorterm traders buy Mar Cx on 1-dc (or decisive rise) over 109^12 for run at 110^25 profit/sell target. Sell, or sell short on 1-dc below 108^09; stop: 1-dc over 109^00. Cover ½ at 106^00 & use trailing profit stop on remainder. And/or sell a rally that clearly stops below 111^00; stop: 1-dc over 111^08. Cover ½ at 109^05, ½ at 108^09. CRB Futures Index CRB futures price index closed Friday Nov 25 at 330.42, ie up 0.66pts on the week. CRB futures price index daily chart (continuation Cx) - line on close:
Gold NY gold Feb futures closed Wednesday Nov 23 (due to US Nov 24 holiday) at 496.40 ie, up 6.20 on the week. ***NY
gold ends off lows in pre-holiday trade, eyes $500/oz "NEW YORK, Nov 23 (Reuters) - Gold futures in New York ended down but off session lows Wednesday as the market continued to show it resilience and held just below the psychological level of $500 an ounce, market sources said. "COMEX gold futures opened lower as investors were seen pocketing profits ahead of the long holiday weekend, but speculative buying supported prices at the lows and the market continued to consolidate after hitting an 18-year high at $495.90 on Tuesday. "NYMEX metals will be closed on Thursday and Friday for the U.S. Thanksgiving holiday. "Benchmark December gold settled down 60 cents at $492.30 an ounce on the New York Mercantile Exchange's COMEX division, after dealing from 487.50 to $495.30. Its all-time high, based on the nearby futures contract, was $873, reached in January 1980. "Final estimated COMEX gold volume reached 110,000 lots, with 10,319 switches. "The trend is really strong, especially after a performance like today where it looked relatively weak in the morning and then we came right back up to settle above $490," said Scott Meyers, senior trading analyst at Pioneer Futures. "Since the start of the year, COMEX gold has climbed 14 percent, or $59, on strong investor demand. Floor dealers said the market may have the ability to reach $500 an ounce next week as over the counter options expire on Monday, Nov. 28, with all settlements occurring on Nov. 30. "We always track options expiration dates. Can you imagine what type of money upstairs is around $500? You don't think those guys are going to want the market to move toward that strike price," one COMEX trader said." End quote Gold (continuation Cx) weekly chart - line on close:
Note:
Gold Charts R Us is our weekly online gold share trading service.
Gold Feb futures daily chart - line on close:
FMU Trader's gold Guidelines: Per HSL650: whipsawed for loses in long & shorts :-( Uptrend from July lows shorterm overstretched/uncertain; limit new longs to toehold positioning only. Gamblers buy Feb Cx if dips to 488.50 &/or 481.30; place preliminary stoploss 12-points below your entry/buy point (basis close). Take ½ profits at 509.60, ½ at 517.40 (or use tight trailing profits stop to follow upside). Sustained break below 460 needed to overturn bullish stance. Euro vs. US$ Euro Mar futures closed Friday Nov 25 at 1.1780 ie, down 0.0060 on the week. Euro Mar futures weekly chart - basis line on close:
Euro Mar futures daily chart - basis line on close:
FMU Trader's Guidelines: Per FMU 9/30: exited Dec longs with loss :-( Traders then sold short Dec on break below 1.2000. Per HSL650: traders sold short Dec at 1.1830 (or better). Head & shoulder tops are the most reliable of technical formations but can develop surprisingly sharp countertrend rallies if reversed to the upside (as recently seen in gold). The trend is clearly down but would become defective on any rise above Mar downtrend resistance. Stay flexible. Sell short Mar Cx at mkt &/or after a bounce that clearly stops at or below 1.2010-1.2160 resistance band; cover ½ at 1.1440 & use trailing profit stops on rest. Stop & reverse/buy on 1-dc (or significant intraday rise) above 1.2230; stop: 2-dc below 1.1960. Sell ½ at 1.2550, ½ at 1.2830. NOTE: Traders are advised to use mini forex contracts to enter/exit trades incrementally. 1 mini Cx = $100/full point, compared with $1,000 for full size Cx (10 minis = 1 full size). Yen vs. US$ Yen Mar futures closed Friday Nov 25 at .8468 ie, down .0039 on the week. Yen Mar futures daily chart - line on close:
FMU Trader's Guidelines: Per FMU 9/30: gamblers sold short Dec at .8915; take full profits at mkt, or apply squeaky tight trailing stops to lock in gains. Per HSL650: traders sold short Dec at .8602. Tuff call to enter new trades in such a lengthy & exceptionally oversold downtrend from Sept peak that has yet to develop any retracement action of significance. Prefer wait for a mini bounce before initiating new longs. Sell short Mar after a bounce that clearly fails at or below .8767-.8844 intermediate resistance; cover ½ at .8410, ½ at .8230 or use trailing stops to follow downside. Buy on 1-dc over .8840; stop: 1-dc below .8550. Sell ½ at .9140, ½ at .9290. Crude Oil Crude oil Jan futures closed Friday Nov 25 at 58.71 ie, up 1.50 on the week. The Commitment of Traders report shows crude oil commercial hedgers added 13,375 longs, bringing total longs to 543,858, whilst shorts added 8119 contracts, bringing total shorts to 473,204. Large speculators are holding 115,494 longs against 117,662 shorts. And, small traders are holding 155,678 longs against 190,543 shorts. Bullish
Consensus shows crude oil futures at 60%. Says: "Crude Oil
futures are moving sideways/higher to test short-term overhead Crude oil Jan futures daily chart - line on close:
FMU Trader's Guidelines: Per FMU 9/30: took profits at both targets in Dec shorts :-) Gamblers sell short Jan after bounce that clearly stops below 59.60 neckline resistance of June-Nov H&S top; cover all at 53.40. Buy Jan on 1-dc over 60.40; stop: 2-dc below 57.00. Buy more on rise above 64.00. Take ½ profits at 67.30, ½ at 69.80. New Stock Recommendations Note: the energy sector is showing timid signs of a revival that hint an important reversal may be at hand (need crude oil above 64.00 to substantiate). Thus we are looking to tentatively reposition in energy stocks. Start by buying toehold positions in 1 or 2 energy stocks only & increase exposure only if /when trades move in your favor. If the reversal fizzles out, be ready to cut losses & move back to sidelines.
Cardero Resources (TSXV: CDU - iron-oxide, copper & gold) (also trades AMEX: CDY) high volume rise above 20-month bullish ascending triangle. Gamblers buy if dips to 4.46 &/or 4.20; stop: 1-dc below 3.50. Speculative.
Laramide Resources (TSXV: LAM - uranium) high volume rise above bullish symmetrical triangle from Sept peak. Gamblers buy toehold at mkt &/or buy if dips to 6.56 &/or 6.05; stop: 1-dc below 4.80.
Pan American Silver Corp (Nasdaq: PAAS - gold/silver) upside breakout from bullish symmetrical triangle from Apr 2004 peak (best seen on weekly chart). Buy bit at mkt &/or buy if dips to 17.80; stop: 1-dc below 15.40.
Southwestern Energy (NYSE: SWN - oil/gas expl-prod) buy on upside breakout from 5-week reverse head & shoulder base, ie: buy at 38.80-stop; stop: 1-dc below 32.90.
Spdr Energy Sector (AMEX: XLE - index tracking) rose above bullish symmetrical triangle from Sept peak. Buy foothold at mkt &/or buy if dips to 49.40; stop: 44.70. Buy again on sustained rise over 52.00 & 55.00.
W-H Energy Svcs (NYSE: WHQ - oil/gas-field svcs) expanding potential reverse head & shoulder base below pivotal 34.00 resistance. Buy at 34.90-stop; stop: 1-dc below 29.90.
Notes: 1)Traders are strongly advised to limit total equity exposure in their portfolios to percentages outlined in the HSL Investment Box. 2)Traders must adapt recommendations to shorterm mkt direction. If strength/weakness kicks in before pullbacks to buy/sell levels are reached, enter small foothold positions at mkt. Likewise if general mkt direction moves against open positions, exit at mkt rather than waiting for stoploss levels to be hit. Your interpretation & modification based on conditions of our recommendations often makes the difference betwn profits or losses. Stop & Sell Recommendations Take
partial profits on: Raise
stop on: Lower
stop on: Sell
at mkt: Cover
at mkt: Cancel
Order to: Note: HSL recom's are followed by a wide selection of investors, ranging from novice traders to professional fund managers. And, many Hslm's have requested we give partial profit taking signals (at intermediate resistance levels) to allow incremental exit from medium to large share positions. Thus, recom's to take partial profits can be given up to 3 times before a position is finally exited. Welcome to the editorial section of HSL Junior
JOKE
***Next HSL Sr will be mailed on Feb 13, but available online & via email & fax on Feb 12. Next Gold Charts R Us on Jan 18. Subscriber input is WELCOME on HSL service, trading recom's, jokes, or any other ideas/info that may be of interest to HSL family members. ***Note: unfortunately, we simply don't have the staff to be able to layout HSL Jr in HSL or GCRU format. If you wish to print a small section or single item from HSL Jr, simply highlight the section in question (click & drag mouse on your browser page) & paste into Word. Word will automatically format pages so that charts & images are not cut in half, etc. HSL contact details For info: fax, phone or E-mail our fulfilment office in Costa Rica: Free phone for US: (1) 866.725.3724 Free phone for Canada: (1) 877.659.9004 Fax:
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