Join        Login             Stock Quote

I On The Market - Tuesday Update - 04/17/2012

 April 17, 2012 09:49 AM

(By Rich Bieglmeier) Monday was a Yosemite Sam "which way did he go" cross firing of a day at the Dow gained 71.82 points, the NASDAQ lost 22.93 points, and the S&P closed near breakeven after shaving off 0.05 points.

The NASDAQ's weakness put the index at a close markedly below its 50-day average for the first time in 2012. While Monday's market action was mixed, the look of the trio's charts is remarkably similar.

Each index is under its 50 dma and their 12 and 26 day average are on the verge of bearishly crossing the 50 day benchmark. Such a move would be seen as a continuation of the current weary tone.

Minus some unexpected positive news out of Europe and China, iStock believes the NASDAQ and S&P are destined to test March's lows.

[Related -Four Stocks in the Dow Making Fresh 52 Week Lows]

NASDAQ: 2900
S&P: 1340

Meanwhile, the Dow has already accomplished the undesirable goal and could fall to 12,600. If the March low support levels fail, then iStock would expect the indexes to retrace 50% of their December to early April gains.

With a good result, today's Housing Starts data could give the market a little juice. Economists believe the upward trend-line will continue with 700, which would be a big improvement from March 2011, but will be flat relative to the last 4 month average.

JPMorgan Chase's Jamie Dimon and Stuart Miller, CEO of home builder Lennar, both announced last week that "housing is near its bottom"; however, Zillow says don't count on it as a ton of foreclosures are about to hit the market.

[Related -Some Thoughts on Greece’s Don’t-Call-It-a-Default]

iStock cannot not count on all of our digits the number of times a "bottom" has been called on housing. So far, the calls have been as accurate and as laughable as "the end of the world" predictions. We are still here, and home prices recently hit post subprime crisis lows.

With the work participation rate at a 30 year low, 88 million (equal to the entire population of the world's 3rd largest economy, Germany) work-aged people un or underemployed, real wages falling and hiring likely stalling, iStock believes the time is not right for the broken clock theory to make sages of Dimon and Miller.

It is our view that housing will flat line at best for the next 6 months. If Spain's and Italy's rising interest rates force a super-sized replay of Greece 2011, then you can tack on at least another year of home prices creeping lower.

iOnTheMarket Premium


Post Comment -- Login is required to post message
Alert for new comments:
Your email:
Your Website:

rss feed

Latest Stories

article imageFour Stocks in the Dow Making Fresh 52 Week Lows

“What gets weak tends to get weaker; what gets strong tends to get read on...

article imageGreece And The Cemetery For Your Wealth

The Greek default is merely the opening act of the worst sovereign-debt crisis in history. By the time it read on...

article imageAll Signs Point To Higher Gold Prices

In the face of historic monetary stimulus from nearly every major central bank in the world over the past read on...

Popular Articles

Daily Sector Scan
Partner Center

Related Articles:

Greece And The Cemetery For Your Wealth
More Articles on: Economics Data

Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.