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Just a short note about today:
 
NASDAQ hit the 200 day moving average to the penny and has held so far. This is huge. DOW/S&P still down much worse but if NASDAQ holds, will go a long way in helping market. The problem: it is normal for an index to hit the 200 day and bounce…because it is so vital. But typically, it eventually gets taken out. We shall see. AMZN and AAPL report Thursday…and those 2 names can and will dictate policy.
 
KORS reversing up in spite of market…as it refuses to break the 50 day…so far.
 
A few DOW stocks in serious trouble…DD,MMM,IBM,CVX for starters.

THE CORRECTION DEEPENS! IS THE MARKET FINALLY STICKING A CERTAIN FINGER BACK AT BERNANKE?

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In the past week, the all-important NASDAQ broke support as well as the 50 day moving average.

The same for the NDX. Please remember, we believe that the NASDAQ leads markets both up and down. The NASDAQ is actually sitting on the longer-term 200 day moving average right now.  The same for the RUSSELL 2000. Today, the DOW and S&P took out support as well as the 50 day moving average. This deepens the correction that started in recent weeks.

Keep in mind, we have no idea how long corrections last or how far they go…just that we know when a market is on the defensive. We now stay patient until we start to see markets defended and then turn up. Be patient as this correction has just started.

To make matters worse, leading growth stocks like APPLE, AMAZON, GOOGLE and many others are coming under severe pressure and are breaking down badly. This is never a good sign.

We knew sales and earnings for this reporting period were going to be anemic but one knows the reactions until they occur. So far, reactions have been horrid. This is another negative for the market.

Lastly, major averages are now down from the latest Mr. Bubble episode where Bernanke decided on a maniacal, open-ended printing of money. We have posed the question recently what would happen if markets finally ignore this obviously blatant move to goose the markets ever higher. We may just be at that point. Market needs a save.

Read more of my commentary at www.garyk.com and https://twitter.com/GaryKaltbaum.

 

Gary Kaltbaum owns Kaltbaum Capital Management, LLC (“KCM”), an investment adviser registered with the U.S. Securities and Exchange Commission. The opinions expressed herein are those of Mr. Kaltbaum and may not reflect those of KCM. The information offered in this publication is general information that does not take into account the individual circumstances, financial situation or individual needs of an investor. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.

kaltbaum premarket

To be blunt, futures smoked this morning…as the Euro weakens…dollar strong…and S&P/DOW now break below the 50 day.
 
You have your marching orders from the service…stay out of anything new. This correction looks to be gaining teeth. Use stop on KORS…and be patient. No reason to play into this. I must add that the market is now down from the day Bernanke announced more special sauce for the market. I have been worried that one day the market would ignore Mr. Bubble. We may be there.

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Believe it or not, at 315, an article released that the fed would expand their money printing…not kidding…helping the market back up. Is this crap rigged or what?
 
In any case, more names breaking today like N and ALXN…and just overall not thrilled. Many think AAPL had a good day but wide and loose action not very good.
 
KORS still hanging in there. You have the stops just in case…otherwise…sit…sit…sit.

10/22/2012: GARY ON NATIONALLY SYNDICATED INVESTORS EDGE RADIO BROADCAST

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http://archives.warpradio.com/btr/InvestorsEdge/102218.mp3

JUST LETTING YOU KNOW

We’ve see a little bit of deterioration in the market. The earnings have not been so good. But let me say there are many earnings reports coming out the rest of this week, including the Almighty Apple.

So Friday was terrible, and today was looking really iffy also. And then at the end of the day, the market came back very nicely to be up on the day in the Dow. I call it a defense day in the market where basically the market says, okay, you’ve take us down enough, we’re defending it right here.

I don’t think we’re out of the woods. There’s been some damage done in the marketplace here.

But again, all this talk of bear markets and end of the world – I think we can have some more trouble. I think we can pull back some more. And for sure, let me be clear on growth stock land. One by one they’ve been taking them out and ripping them apart. And that has to be watched.

In recent weeks, all the dollar stores – toast.

Amazon breaks badly.

Some of the biotech goes bye bye.

Apple breaks the 50-day.

It’s been rough. Want me to continue?

On the other end other spectrum, Housing is still in shape. Industrial types are still in shape. And, keep this in mind – Foreign markets are outperforming our markets for the first time in months and months. So we’ll be harping on those areas if leadership shows up in those areas.

If you want to know what I mean by outperform, just go look at EEM and ETA.

These are emerging market types, and you can see they’ve hardly pulled back while ours have a little more than that.

Most importantly, I am watching reactions to earnings.

The Grand Super Cycle

In Cincinnati, OH this Saturday, IBD and William O’Neil will be giving a 2-hour workshop on the Grand Super Cycle. Click here, if you’re interested.

I want talk about this Grand Super Cycle. Listen carefully, from 1966 to 1982, the Dow did nothing. It topped out in 1966 at 1000 and finally broke out from 1000 in 1982. So, 16 years of nothing.

In the last year or two, until the market turned, nobody wanted to be in stocks. Everybody wanted out. Front cover articles, death of equities. You name it.

That leads to the year 2000. Bubble. Valuations off the charts, especially in the Nasdaq tech types. Even the Walmart’s and GE’s of the world were at 50x-60x earnings. That led us into another 1966 to 1982 period.

In 2001, on my radio show, I posed that to you. Bulls and bears, and no progress at all in the major indices. Fast forward. We’re now 13 years since January 1, of 2000. In 2013 will start year 14.

Now, Bill O’Neil thinks that we will be lifting off again within the next year.

I do not know. I try not to argue with him and, guess what? We don’t have to worry about it until the market shows itself anyhow.

My biggest issue is that 1982, the P/E multiple on the market was at 8. Dividend yield was 5-ish. We’re not even close to 8 here and certainly not close to 5-ish on the dividend yield.

And we’ve got $16 trillion in debt that we didn’t have back then. But we’ll see.

So I’m just letting you know, I’m on notice and you should be on notice.

If you live near Cincinnati, I’d go to this.

Certainly, the last secular bear was 16 years. The one before it was 15. We’re possibly in the 8th or 9th inning of secular bear. My guess was always about 2015-2016 before we lift out of this. Bill O’Neil thinks it’s going to be earlier than that. I won’t argue.

I will certainly let the market decide.

LISTEN TO GARY LIVE ON WEEKDAYS 6-7 PM ON A STATION NEAR YOU AND AT GARYK.COM

6-7 pm EST

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Saturdays 1-2 am EST

Gary Kaltbaum owns Kaltbaum Capital Management, LLC (“KCM”), an investment adviser registered with the U.S. Securities and Exchange Commission. The opinions expressed herein are those of Mr. Kaltbaum and may not reflect those of KCM. The information offered in this publication is general information that does not take into account the individual circumstances, financial situation or individual needs of an investor. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.

SOLYNDRA…THIS GIFT THAT KEEPS ON GIVING

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Perhaps you thought the Solyndra scandal amounted to a $535 million government loan that will never be repaid. No such luck. In the latest twist, Solyndra’s investors could be rewarded for their failure, thanks to a tax benefit the Administration handed out in a bid to evade political accountability.

The Internal Revenue Service exposed this double Solyndra debacle last week in the U.S. bankruptcy court for the district of Delaware, which is unwinding the defunct solar-panel maker. The IRS formally objected to Solyndra’s Chapter 11 reorganization plan, claiming its “principal purpose is tax avoidance.”

Continued

SOURCE: http://online.wsj.com

 

kaltbaum weekend report

First, the leader’s list with a few more names coming off and a couple more on the bubble.
 
ALXN- May be starting to break. Earnings next week. Just about off list.
BIIB– Breaks 50 on volume. Off list.
EQIX– Falls further under 50 day…now off list.
EXPE– Breaks badly…off list.
EBAY- Good reaction to numbers…fine for now.
GOOG– Do I need to say it…a goner!
HD- Fine…but getting wide and loose.
KORS- Tries to break out…market reins it in.
MA Pulling back.
N- Still holding above 50 day…but toppy here.
SHW- Still no issues…no entry…
UA- Mentioning because back above 50 day but now trading wide and loose.
ULTA- Just about off this list.
V- Just pulling back so far.
WFM- Now looking toppy.
 
Recently, these names have been taken off this list.
 
AAPL,AMZN,BIIB,CRUS,EXPE,EQIX,GOOG,EQIX,LNKD,MLNX, ROST,SWI,TJX.
 
There are two vital things I follow in the market…the NASDAQ and leading growth stocks. The NASDAQ is croaking and more and more leading growth names are breaking. There is no way to spin this.
 
Groups that are acting well are INSURANCE, HOUSING, MEDIA-CABLE, DRUGS and a few other things. FINANCIALS still ok but a few names breaking down. A few DEFENSIVE names in the Food area. I would also repeat that foreign markets are now outperforming ours and COMMODITIES are acting relatively better.
 
This is all less than thrilling. That’s the best way I can put it. I am looking at this NASDAQ chart and have to be worried as the NASDAQ is the leading index both up and down.
 
My best advice is to sit. I do see a bunch of shorts setting up and will start playing soon…but it is better to relax when the market is coming in. If things worsen, there will be plenty on the shirt side…and my best guess…things aint getting better any time soon. A load more earnings this week.

10/19/2012: GARY ON NATIONALLY SYNDICATED INVESTORS EDGE RADIO BROADCAST

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http://archives.warpradio.com/btr/InvestorsEdge/101918.mp3

JUST LETTING YOU KNOW

In past week I told you specifically that I went low beta. And specifically, what does that mean? It’s getting away from the more volatile…growth names in the market.

Why?

They weren’t working.

And lower beta was.

I recently told you that the Nasdaq was really starting to underperform and as I mentioned yesterday on my radio show, the Nasdaq leads markets up or down and when there is a stark divergence that stands out in the Nasdaq, you have to wake up.

In recent days, the Dow and S&P pulled back to their 50-day moving averages, a normal occurrence – and they rallied for 3 days off of it.

The Nasdaq and Nasdaq-100 rallied into it and today failed miserably. And this is something that has to be watched. That’s the only way I can put it. We need to be a little more low beta.

That’s all.

What does this turn into, I don’t know. But let me go into a few other things:

  1. For starters, the Nasdaq has had three successive lower highs and then today on big, big volume.
  2. The areas that were acting best, the Dow and the S&P, rallied up to the high now three times…and failed there.
  3. We’re starting to see some blow-ups. And I’ve read Stan Weinstein for years. He’s always had this line: “It’s not a healthy market if stocks are blowing up” – especially when you get important stocks blowing up and we’ve had a few of those.

So I would just keep my eyes on the lookout kids. The Financials have been acting well. The Housing has been acting well. On a relative basis the Commodities have come off their lows.

I can tell you the Financials got hit today.

The Commodities pulled in pretty decently today.

Housing, thought is still mostly up.

But for me, the eyesore…the sore thumb…the chink in the armor – watching this Nasdaq getting itself in trouble. In one glance, when you have a chance, you will see a top at 3196. The next top on a reversal day was 3171. The next top was 3112. And now we broke another new relative low, which was 3037 as we finished 3005 today…and on some pretty darn big volume. You will notice that when you rallied up here, you rallied up in to the 50-day and got slammed down off of it.

And the same goes for the Nasdaq-100.

Must be watched.

The Nasdaq has been the leading index influencing most of the market, both up and down, I think, since the early-90s, as best as I can recollect.

What does this lead to, I have no idea.

How long does it go, I have no idea.

What are we…6% downside from the high? Not the end of the world.

But at end of today, they were selling into it. 

LISTEN TO GARY LIVE ON WEEKDAYS 6-7 PM ON A STATION NEAR YOU AND AT GARYK.COM

6-7 pm EST

Best of Investor’s Edge
Saturdays 1-2 am EST

Gary Kaltbaum owns Kaltbaum Capital Management, LLC (“KCM”), an investment adviser registered with the U.S. Securities and Exchange Commission. The opinions expressed herein are those of Mr. Kaltbaum and may not reflect those of KCM. The information offered in this publication is general information that does not take into account the individual circumstances, financial situation or individual needs of an investor. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.

OBAMA THE COMEDIAN

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ROMNEY THE COMEDIAN

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