08/16/2012: GARY ON NATIONALLY SYNDICATED INVESTORS EDGE RADIO BROADCAST

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https://archives.warpradio.com/btr/InvestorsEdge/081618.mp3

JUST LETTING YOU KNOW

I really liked the action today in the markets. Whether or not it continues beats the heck out of me. But we can only hope that good continues.

In the past seven days, the market looked like they were sitting, doing nothing. Today, it looked like the same thing. An economic report came out that didn’t look very good.

But then they started talking again in Europe. And then the Euro rallied. And everything Euro based (anti-Dollar based) rallied also…names like IBM, 3M and the like – they’re dollar based. They started rally and, of course, the commodities rallied.

There are some definable things happening right now. Let’s hope it lasts.

Here’s the good news.

1. The Euro is still rallying. That means the dollar is going south. So the dollar plays continue to work. That means that one of the best beneficiaries of a strong dollar is IBM. Go look at their financials. When the dollar weakens, they do better. Sales go up. Earnings go up. Same for other multi-nationals like the 3Ms and the like. Also, when the dollar is weak, commodities go up. We are seeing that right now.
2. The past 8 days, the market stayed in contracted volatility. And I said to you that the next move will win — in the short run.
   • Just by way of example, the S&P edged above this little range that it has been in.
   • The Nasdaq-100 edged above the little range it has been in.
   • Dow the little range it has been in.
   • The weaker Russell 2000 did not break above early July’s highs, but it broke above the past 7 or 8 days…and that’s a start.
   • The Small Cap 600 broke above.
   • The Mid Cap 400 edged above.

…catching the drift?

IF THIS MOVE HOLDS, it gives the market impetus to higher from here. It’s simplistic as that.

Often breakouts fail. But we deal with as it they come.

The old high on the S&P was 1422. We’ll see what happens up there.

The old high on the Dow was 13338. Getting close.

The Nasdaq’s old high was 3134. Getting there.

The Russell 2000’s old high…got some work to do.

So I just wanted to make note that we’ve edged out of some ranges here. On top of that, the Financials (see the XLF and IYF), both edged out today just by a smidge.

But other things moved out. The XHB, The Standard & Poors Homebuilders Index moved out into new high ground.

If this moves stick…good.  But there is no rule of thumb that says it will hold.

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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.