Intraday Investments Stalk Sheet for Friday, August 3, 2001
In overnight action, the Nasdaq Futures are up 9.00 pts and the S&P futures are down 4.50 pts as of 11:20 pm edt. On Thursday, the semi’s gapped, sold off and then rallied strongly into the close. Friday is a big day for economic news. We must be careful in front of the unemployment numbers.
Additionally, in overseas action, the Nikkei fell on the heals of some bad news in the banking sector: TOKYO (CBS.MW) - Tokyo's Nikkei stock index snapped its three-day winning streak Friday, as investors dumped banking shares after several of the country's largest financial institutions announced massive write-offs of bad loans.
While banks were getting hit hard over concerns about their financial health, tech shares weren't faring much better in early Tokyo trade.
The Nikkei Average was down 0.85 percent, or 105.46 points, at 12,293.74 points. On Thursday, the index climbed more than 3.5 percent, boosted by gains for chip stocks following a report by Merrill Lynch that said the worst may be over for global semiconductor firms.
Mizuho Holdings, the world's largest financial institution by assets, announced late Thursday that it will write off 1.2 trillion yen ($10 billion) in bad loans by 2003 as part of a plan to clean up its balance sheet.
Three other banks -- Daiwa Bank, Asahi Bank, and Chuo Mitsui Trust and Banking -- also revised up their estimates for loan loss charges for the year.
It should be interesting to see if there is a spillover effect in the US markets.
On Friday, there are no firms in our sector model reporting earnings.
Economic data due out on Friday includes: Nonfarm Payrolls for June, Unemployment rate for July, Hourly Earnings for July, Average Workweek for July and NAPM Services for July. Here are some important factors within the economic numbers due out tomorrow that could affect the markets: Nonfarm Payrolls: 3rd decline in the last 4 months expected, 4th for private (excluding-government) payrolls, Unemployment Rate: Rise to 4.6% expected, highest rate since March 1998. Hourly Earnings: 4th consecutive 0.3% rise expected, 4.2% annual growth. Earnings growth expected to slow as labor market continues to loosen and this could have a devastating effect on the consumer, who, to this point has held up this economy. As one analyst put it, “The lagged effect from announced layoffs is pummeling the payroll data and the economy. The unemployment rate continues to trend higher and reflects the rapid loosening in the labor market”.
LONGS:
SCON, Superconductor Technologies, Long > 4.55, Superconductors
SCON rallied nicely on a big spike in volume and closed at the highs of the day. Above 4.55 we break Thursday’s high and the 200 ma on the 15 min chart.. Strong volume is a must. First target is 4.70.
PALM, Palm, Inc., Long > 5.50, Handheld Computing (PDA’s), $HWI.X
Above here the stock breaks the 20 and 40 ma’s on the daily and Thursday’s high. This one will see some resistance at 5.54 (200 ma on 60 min chart) but with solid volume it should be able to break out. We’re looking at this one as a sympathy play since HAND and RIMM (same sub sector) both broke out on big volume on Thursday. Palm may just be the laggard. Strong volume is a must for this stock to go anywhere.
SYMC, Symantec, Long >50.85, Software- Productivity Applications, $GSO.X
For Symantec to break out it will have to see considerably better volume than it had on Thursday. Stock is above all 20, 40 and 200 ma’s on the 5 , 15 and 60 min charts. The only obstacle in it’s way is Thursday’s high and the 200 ema on the daily (around 51.00). Without strong volume I would only buy SYMC on a pullback off a breakout above 51.00 (proof that breakout will hold 200 ema on daily).
SBUX, Starbucks, Long > 18.58, Retail- Consumer Non Cyclical, $RLX.X
Above here SBUX breaks the high of a 3 day consolidation zone and the neckline of an inverse head and shoulders formed over the past 4 days. Above here we should see next resistance at 18.75 quickly. Strong volume is a must.
CPWR, Compuware, Long > 14.45, Software- Development Tools, $GSO.X
Compuware saw an incredible burst in volume on Thursday and the stock closed at a new 52 week high. The bad news is that it was unable to close above the high of 14.38 set on 01/24/01 on a heavy volume day in the stock. Nonetheless, the stock consolidated nicely on Thursday and is in perfect position to break to new highs if the market and volume cooperate.
Oil Service Sector : We saw reversal candles in this sector on Thursday and expect a rally to follow. Stocks to watch include HAL, NE and BHI.
SHORTS:
AXP, American Express, Short < 41.10, Consumer Financials Svcs-Banking, $BKX.X
Amex broke a 6 day up trend line on Thursday and formed a doji reversal candle as it was unable to break to new highs on strong volume. We may look to take it short just below 41.15 as it could fall hard after a 7 day rally. Below 41.10 we lose the 20 per ma on the 60 min chart and the 200 ma on the 5 min chart.
IDTI, Integrated Device Tech., Short <37.40, Semiconductor-Mixed Signal Datacom, $SOX.X
This stock broke the up trend line on the 60 min chart today after a multi day run. Below here we lose the 40 ma on the 60 min chart and the 20 & 40 ma’s on the 5 min chart. 37.40 is also the low of the day for Thursday. Next support at 36.50, then 36.00 and 35.50 (200 ma on 15 min chart).
ASML, ASML Hldgs, Short < 20.64, Semi Equipment
Below here we break Thursday’s low which corresponds with the 200 ma on the 60 min chart. Sharp reversal on Thursday on big volume. May take this one short below 20.88 if selling pressure is strong.
ADI, Analog Devices, Short < 49.15, Semis – Mixed Signal + DSP Conglomerates, $SOX.X
This stock rallied into a double top on Thursday and ran out of gas. Below 49.15 we break the up trend line on the 60 min chart along with the 20 ma on the 60 min chart and the low of the day for Thursday. The stock also breaks the 20, 40 and 200 ma’s on the 5 min chart below this price. Below here expect to see 48.00 quickly.
Trade Well Today!
Ed, Steve & Deron
General Partners
intradayinvestments.com |
