PRE MARKET

Futures up but not a lot of movers early as we are past a lot of earnings season.

After dropping 60% since last November, URBN up over 20% on a 33% earnings drop…but better than expected. After that, not seeing much but looks like the North Korea action from last week could be in the past. Just remember, still around a 50-50 market with many areas in private bear markets and many things lagging.

PRE MARKET

One of the most important things we can do here as well as on the radio show…is to tell you what to avoid. When we tell you what to avoid, it is for a good reason. Price is not keeping up with the market. Price is starting a downtrend. Price is in a downtrend. Price breaks support. Price breaks longer term support. Price goes into a steep downtrend. Price stays in that bearish downtrend. Of course, we also add in the why. For many moons, we have been telling you to avoid just about everything RETAIL. RETAIL broke down, headed down, broke shorter term support, longer term support and then got real bad. It was not just any RETAIL. It was MOST ALL RETAIL.

Today…again…AAP is gapping down from $109 to $93. We turned negative on AUTO PARTS RETAIL a long time ago.

DKS is gapping down from over $35 to $28. That top occurred in the high 50s. Whether it is M, KSS, TGT, DLTR, DG, COST, GPS, FL, BBBY, LB and dozens of others, pay attention to price. These are all famous names. All past favorites that are now toast. The world is chaning. We are reading every day about slowing comps, more stores being shut and everything that goes along with things heading south. Pay attention.

Futures up a bit. Looks like maybe, possibly last week was just the North Korea thing…but remember, regardless, this is now around a 50-50 market where half the market ain’t happening. The good 50% better keep working.

COH,…one of the few better acting RETAIL-types gapping down about 8%. Sales down 2%.

Other thoughts:

As we predicted, North Korea blinks. As soon as China threatened them with cutting them off, they had no choice.

Other earnings this week: TGT, CSCO, LB, NTAP, WMT, AMAT, GPS, ROST, CRM, FR, EL, FL.

Rates up decently today which means FINANCIALS will be up. Whenever rates on the long end back up, financials move up because of the expected margin expansion. REGIONALS do not act well. The big guys are range-bound.

SEMICONDUCTORS (SOX) are back above the 50 day. This is important and needs to hold. Notice how market has been following this group almost to a tee.

 

MR PRESIDENT- YOU WERE PRESENTED WITH AN OPPORTUNITY!

BY GARY KALTBAUM- AUGUST 14, 2017

We all get opportunities in life. Some are small. Some are big. SOME ARE GIGANTIC. All presidents get a gigantic opportunity. There have only been 44 men to experience the opportunity. (Grover Cleveland had non-consecutive presidencies.) Only 44 men that have had a chance to change the world for the better. It’s what you do with those opportunities that define you.

President Donald Trump, as president, was given one hell of an opportunity this weekend, one that emerged out of tragedy, a woman’s murder as well as many other injuries. Donald Trump squandered the opportunity.

If I was president, I would have taken the opportunity to do something not many get the opportunity to do…and that is to take the opportunity to tell a world that listens to every word I say that nazis, white supremacists, the KKK and whoever else kisses the ass of anything Hitler…that you are scumbags, that you are dirt, that to be a fan of a man that murdered over 10 million people,  6 million of them Jews, will not be applauded but will be treated as a scourge, the worst kind of scourge. You want to believe in all this crap? You are lucky. This country allows you to believe in stupidity. You want to believe it and act on it? You want to commit violence? You will be indicted. You will be convicted and you will be put in a 6 by 9 cell for as long as the law allows. Believe it in your homes. Believe it while you are sitting on the john. Just leave the rest of us alone.

I have been to Auschwitz-Birkenau. I have been to Terezin. I have spoken to concentration camp survivors. To not make a SPECIFIC AND EMPHATIC STATEMENT NAMING THEM BY THEIR SCUMMY NAME when the opportunity presents itself disrespects all that have been affected by the horror of Hitler and the Holocaust.

Mr. President. The media is bashing you. The left is bashing you. But we do not give them any credibility because according to them, you caused the Chicago fire, San Francisco earthquake and the bubonic plague. No matter what you say or do, you will never be right in their eyes. They think you are nothing more than a racist. I don’t believe it. No, I  have never met you and do not know you. But somehow you went through 70 years of your life not being a racist.

But you blew it and now it is time to fix it. Get yourself front and center and immediately. No tweets. Television! No script.  Just words from the heart. Just you looking directly into the camera telling the world that this will not stand. Nazis, white supremacists, KKK, David Duke and the rest of these clowns do not represent who we are and what we are. Great opportunities. Mr. President. You still have one! It’s time to take this opportunity and make good on it.

ANOTHER JACK TO THE UPSIDE MONDAY

Is it me or are we seeing another mystery Monday gap to the upside? Either way, markets were oversold near-term coming in and the will be worked off on the open.

A FEW OTHER THOUGHTS:

Japan’s GDP comes in at a yearly 4% clip. If I was printing a trillion each year and keeping rates at -.5%, I would have GDP at 10%. Japan also buys up their markets.

The market is no better than a 50-50 market. Last week took down a few more names.

China markets, which were slammed past 2 days, biggest mover overnight.

TRANSPORTS will indeed be holding 200 day average for the 4th time since May. RUSSELL will bounce off it on this gap.

Some of these gaps have been reversed. To be watched.

OFF LAST WEEK’S UGLY, NEAR-TERM POSITIVES…BUT JUST NEAR-TERM

Our proprietary sentiment indicators are off the charts, shorter-term bearish…which is bullish. When too many get scared AFTER a drop, it usually gets us close to a bounce. But other things we are seeing may be at work:

Notice the TRANSPORTS again look to be holding the longer-term 200 day. TRANSPORTS are not leading but they look like they are holding and due ot bounce.

The NASDAQ/NDX is right on and at the 50 day average…and suspect we also bounce there…for now.

BIG FINANCIALS are now on the 50 day…but keep in mind, regionals and such (KRE) act awful.

While the RUSSELL is weak, it is also down to the 200 day, a place where it could bounce.

While we are not big on the VIX, let’s just say that spike to the upside is overbought.

Now onto the bigger picture which is less than thrilling:

Instead of it being a 60-40 market, we think it is now 50-50 at best. Last week’s action did more damage.

There continues to be an inordinate amount of blow-ups considering we are just off the highs.

New highs have been pitiful while new lows have expanded past new highs. Again, this is occurring just off the highs.

Underneath the surface, internals have worsened. At the very least, watch them bounces. We will be able to tell a lot more by how strong or weak the bounces will be.

PRE MARKET

Futures are flattish after being down much of the evening.

Who said this?

“IF THEY EVEN USED THEM (NORTH KOREA AND THEIR NUCLEAR WANTS), IT WOULD BE THE END OF THEIR COUNTRY!”

Who said this?

“WE COULD DESTROY YOU! (NORTH KOREA)”

Wrong…it was not Donald Trump. It was Bill Clinton and Barack Obama. So when you watch the corrupt media crapping in their pants over Trump’s harsh rhetoric. realize they are full of crap. If Trump was soft, they would complain he was soft. If he is harsh, that’s bad to. As much as we are not thrilled with Trump as of now, he can never win with this media. Please get your facts straight and construct opinions based on what you think…not what they think. The facts are the last 3 presidents massively failed with North Korea. Diplomacy failed. Talks failed. Negotiations failed. Rhetoric failed. North Korea had one goal and they are now laughing at everyone who sat and watched.

We said  all we need to say in last night’s report. Markets worsened yesterday after being a 60-40 market but. We try not to rationalize why but know the North Korea issue not helping. We want to see a couple more cards coming out of the deck before we say the end of the world is at hand. (sarcasm)

SNAP down near $12. As we stated when the company came public…”If SNAP was selling steel, it would be a $5 stock!” The only reason they were able to come out with an outrageous valuation is because of the industry they are in. But business slowing, losses mounting and even at these levels, valuations are a joke.

JCP going the way of the dodo bird. Down 22% this morning on more losses. Leader NVDA also down $11 even though they had strong earnings and guided higher. TTD up nicely on strong numbers.