Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: Logain Ablar who wrote (46186)	6/27/2010 5:01:12 AM
From: Johnny Canuck	Read Replies (1) \| Respond to of 70543

It looks like the intermediate trend is still down for all the indices as indicated by the downward pointing 50 day SMA on all the averages. The only strength seems to be in technology sector as indicated by the fact that it is the only index that still above the 200 day SMA. For me the important fact is that this is the second attempt to break the 200 day SMA. So the strength is relative and weak at best. The SPY and DIA are already in a confirmed long term down trend and has failed to confirm the rally above the 200 day SMA twice. It needs to set a higher high and confirm the break out in the next rally or I expect these indices to break the recent support levels and set new lows The interesting points for me are despite the intra-day volatility, the volumes have remained relative low and the averages are converging. The convergence of the averages indicate a possible consolidation phase. It looks like there is indecision by the institutional traders. Not enough of them are convinced the economy is going to double dip to cause wholesale selling, yet enough are still willing to take a wait and see attitude to see if the economy does firm up later in the year. In the case of JBL, I still not heard the call but looking at the chart it looks like it was a case of sell the good news to lock in profits. The selling kicked in right as the price crossed the 200 day SMA. There was high volume on the day of the earnings release and a positive reaction and low volume on the two profit taking days. If the price bounces above the recent high on a bounce of the market indices, I would be inclined to believe traders believe the outlook put forward by management. Some of the trends discussed on the JBL CC are long terms trends that will evolve over the next 3 to 5 years. New design wins are more important about what is going to happen over the next 9 to 12 months. I am not sure I am as optimistic about some of the health card trends talked about on the call.

To: Logain Ablar who wrote (46186)	6/28/2010 3:40:32 AM
From: Johnny Canuck	Respond to of 70543

Brief notes from the JBL call: 1) Don't see a double dip recession right now. 2) Spot component storages happening in certain areas. JBL building inventory at customers request. No risk to JBL as customer owns the inventory. 3) Looking at margin expansion going forward due to new programs. 4) Core tax rate 20 percent 5) Comment on changing business: don't expect to build a PC or laptop again. Focusing on higher margin more complex systems. Market changes every few years and JBL changes with it. 6) NOK very little revenue now. NOK took a lot of device manufacturing in house in 2007. They don't expect to do business with NOK on any programs they do in house as it makes no strategic sense. They will build mechanical components for NOK though. 7) New program area will grow 15 percent on average over the next few years. Low pentration and starting at a low base means they won't make large contributions to revenue and EPS for years as opposed to quarters. It confirm my overall impression that guidance was good. The fact it could not hold the gap up shows how nervous the market is. JBL management commented on weakness in Greece, Spain and Portugal. They are not large markets when compared to France. They don't see the impact that some people are calling for.