Oct 18, 2010 - Issue #237



Opportunity Season?



Opportunity Season?

CNBC's Option Action calls 'earnings season' 'opportunity season'. Opportunity for what?

Check out bank stocks (there's two of them in the DJ-30): BAC, JPM. Mortgage forclosure mess.

As if that's not enough: APOL, DV (Education & Training Svcs). Student loan scandal.

Object lesson: Buying stocks without also buying 'protective Puts' is opportunity for disaster.

Countdown till November 2nd elections: 15 days.

Heads Up

W. D. Gann, a keen market observer, although not an astronomer, nevertheless, was fascinated by the apparent coincidence of important market 'pivot points' and astronomical dates. Theories exist for estimating time and price of important market turning points but astronomical occurrences are computed with mathematical certainty.

There is no logical reason why these occurrences should coincide yet, empirically, they have.

The 'Full Moon' and 'New Moon', among others, have been cited. Therefore, one might be well advised to be aware of their occurrence. Note: The first 5 business days of 2008 concluded on a 'New Moon' and we all know how that worked out. Coincidence?

10/7 Thursday - New Moon.

10/22 Friday - Full Moon.

During the next two weeks, the following DJ-30 components report earnings. Keep a sharp eye out for possible price swings leading up to 'earnings day' (Subject to revision):

10/18 IBM.

10/19 BAC, JNJ, KO.

10/20 BA, UTX.

10/21 AXP, CAT, MCD, T, TRV.

10/22 VZ.

10/26 DD.

10/27 PG.

10/28 MMM, MSFT, XOM.

10/29 CVX, MRK.

Dow score card for the week ending 10/15/10.

DJ-30: 11062.78 +56.30 +0.51%. The Real World (arithmetical) DJ-30: 48.72 +0.24 +0.51%.

UP: 20, Down: 10.

Trends (weekly charts): This is the subjective part.

Rising (Generally Higher Highs/Higher Lows) 16 (N/C) 53%:

AA, BA, CSCO, DD, +*DIS, IBM, JNJ, +*KFT, KO, MCD, +*MSFT, PFE, +*PG, +*TRV, UTX, XOM.

Consolidating (Generally Lower Highs/Higher Lows) 12 (-1) 40%:

+*AXP, -*CAT, -*CVX, -*GE, HD, HPQ, INTC, -*MMM, MRK, T, VZ, -*WMT.

Declining (Generally Lower Highs/Lower Lows) 2 (+1) 7%:

-*BAC, -*JPM.

+/- denotes change of direction.

* denotes change of category.





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