Todd Market Forecast Stock Market Update for Wednesday 03/14/07
www.toddmarketforecast.com
Available Mon- Friday after 6:00 p.m. Eastern, 3:00 Pacific.
DOW + 57 on 650 net advances
NASDAQ COMP. + 21 on 200 net advances
SHORT TERM TREND Bullish
INTERMEDIATE TERM TREND Bullish
Editor’s note. We will be speaking at the Wealth Expo in Atlanta, GA this weekend. Anyone wishing to attend can sign up at www.thewealthexpo.com.
STOCK MARKET ANALYSIS:
We were quite pleased with the final result on Wednesday. We thought there was a good chance for the market to hold the closing lows of March 5, but when the Dow was down 135 points intra day, we strongly considered hiding under the bed.
As it turned out, the lows did hold and what we ended up with was a high volume reversal. There are no guarantees in this business, but that normally has bullish implications for the next several weeks. The next task for this market is to close above the levels of March 12. This will give us a pattern of ascending highs and ascending lows or an upward zig zag on the daily charts.
We noticed another interesting point today. The EEM which is the ETF for emerging markets shows good relative strength versus the S&P 500. It didn’t come close to its March 5 low. Upon further investigation, we found to our surprise, that the EEM tends to lead the S&P.
NEWS AND FUNDAMENTALS:
The current account deficit was $195.9 Billion, less than the consensus $203.5 Billion. The import price index rose 0.2%. the expectation was for an increase of 0.8%. On Thursday, there is a data dump. We get the producer price index, the Empire State Index and the Philly Fed Index.
On the stock front, Aaon, Eddie Bauer Holdings and Gymboree rose 13%, 4% and 9% on earnings. Corn Products was upgraded by Deutsche Bank and gained 4%.
On the negative side, Audio Codes guided lower and tumbled 22%. Clean Harbors and J. Crew dropped 7% and 3% on earnings.
BOTTOM LINE:
Our S&P and NASDAQ intermediate term systems are on a buy signal. Mutual fund investors should be in a 100% invested position.
Short term ETF traders are in cash. On Thursday buy the Russell 2000 ETF, symbol IWM at the market if there are more advancing issues than declining ones on the NYSE at 10:15 New York time. Place a stop at 75.50.
OTHER MARKETS
We are on a buy for bonds as of January 31.
We are on a sell on the dollar and a buy for the Euro as of Feb. 15.
We are on a sell for gold as of March 2nd.
We are on a sell for crude oil as of March 12.
We are bullish for all major world markets, including those of the U.S., Britain, Canada, Germany, France and Japan.
