THE BARRON

The folks at Barron's have put together a great issue highlighted by a terrific thought provoking article by everyone's favorite CNBC guest commentator, Michael Santoli. The article discusses the divide between the real wealthy and every one else and how investors of every ilk might be able to profit from the super well to do. Michael notes how C and others have assembled a basket of stocks that benefit from the super rich; in the basket are names such as TIF COH BID RL and FS. I agree 100%.

The folks at the roundtable also have some interesting picks such as LYO HIG and PXD. Bill Gross mentioned the EFA ETF which is a play on foreign markets and the weakening dollar. I agree 100% again.

Finally, Abbey J. Cohen is of to a lousy start for the year as her picks have included two stocks that have already blown up- SYMC a few days ago and GE yesterday. She always says she is not a stock picker and not sure what she does at GS besides give interviews, but if it works for them and the stock price (GS), that's ok too.

THE CLOSE

Markets finished near where they began with the DJIA a red 2, NAZ green by 8 and SPX a green 4 as it benefited from higher prices in the oil patch. For those who thought they missed a lot of trading this week, well not exactly as the DJIA had a range for the week of about 90, while the SPX had a range of 11. Again, that is for the week, so if low volatility begets high volatility, get some rest as the action next week should be volatile.

Strongest sectors today were oils, metals, gaming, homies, biotech, airlines and small caps while internets and tech lagged.

Market internals were very strong with the SPX showing about 330/170 winner to loser ratio while the OEX was even better with over 70 of the 100 issues closing in the green. The DJIA was clearly the weakest link with GE and IBM accounting for 35 points of the red action.

The OIH, which was very strong all day due to higher crude and excellent numbers from SLB, was pinned exactly at 132.36. Amazing, right between the two option strikes.

Biggest winners included COF SLB AA XLNX LRCX JOYG JDSU ADCT CNX while WMFI IBM TXT GE XMSR SIRI ROST RF and AXP were the biggest losers.

Revshark at realmoney.com had an article early this morning about the lack of participation by the small caps[ well the $RUT finished the day up .9%, and at its 50 day SMA, way outdoing the other major market indexes. It was also growth over value so maybe some higher prices next week.

AFTERNOON ISSUES

Markets continue to trade in a choppy fashion with tech bellwhether IBM trying to recover from earlier lows. It now trades lower by $3+ and is accountable for about 25 points of the DJIA losses.

Strongest sectors have also flipped as some of the gamers have taken the lead with LVS and WYNN both flipping to a nice color of green. Oils, metals, homies, biotech, semis and small growth stocks are the leaders while internets, finanicals and software lag.

Market internals are still very bullish with 950 net green on the NYSE and 375 net green on the NAZ.

The NDX 100 internals continue to act the worst of the big three with winners and losers about equal whereas the SPX shows over 300 green and under 200 red. The OEX acts best with 65 up and 35 down.

Winning stocks include SLB DOW COF XLNX BRCM LRCX and JDSU while the worst are IBM TXT WFMI XMSR SIRI and ROST.

The key stock list is also telling of higher prices as GS GOOG AAPL MER MS and KLAC/SMH are all green. The AAPL quote is a flip as it opened the day lower.

MORNING CHECK

Markets have open mixed with the DJIA down by 7, NDX flat and SPX up 2. The DJIA is leading lower due to the price weighted factor of the index as IBM is the highest weighting and it is down over $4 while MO, another big weight is down almost a buck. Leading the DJIA are AA JPM and XOM.

Strongest sectors are oils, metals, big biotech, homies, drugs, trannies, semis and utes; lower are small caps, airlines, internets, brokers, and retail. Big cap growth and small cap growth are leading large cap value and small cap value.

The NDX has about 40 winners to 60 losers while the OEX has almost 65 winners to 35 losers; the big cap SPX has about 280 to 220 ratio of winners to losers.

Overall the NYSE is about 200 to the green while the NAZ is about 330 to the red. Just about flat overall with a red skew from fixed income as the 10 year Bond is up to a rate of 4.77%.

There is an interesting trade on the YM as the Pivot point is near the 12,610 level while the pivot on the cash index is near 12,550. I suspect the DJIA is going higher as for what ever reason it just doesn't like to be under the 12,600 level on the futures.

PRE MARKET ACTION

Markets are set to open lower on the heels of the crummy reaction to IBM's earnings release last night and crummy reactions to just about all earnings news. Just wondering if the sell siders will come out next week screaming about unwarranted selloffs in INTC GE AAPL IBM etc. and its time to buy.

The DJIA Futures are about 40 points below fair value while the NDX and SPX Futures are also lower.

Gapping up this morning are JDSU NUAN HYTM SMOD HOKU SLB NITE AKAM RACK STM; gapping down are CWTR IBM CAMD SAY XMSR GE NOK QGEN RAD MOT SIRI and the long forgotten KRY.

The MGM target is raised at UBS to $79 from $63 and they say "it remains their favorite stock among gaming operators and views MGM as both a concentrated play on the Las Vegas strip and a lower risk/reward profile for exposure to Macau vs. LVS and WYNN.

I suspect more market selling today with a bounce set up nicely for next week. For what its worth.

UGLY DAY

Markets close near the lows as the NAZ finishes down 36 and the DJIA down 9. Yes, not a misprint as the mean reversion takes hold. Remember the other day when the DJIA was down 40 and the NAZ was up 12 so I guess what ever goes around comes around.

The NAZ was clearly the worst of the big cap indexes and is back at/near its 50 day SMA and trades at a 2 day RSI of 7. So whoever thought it was going to over 100 (yes you), it didn't exactly work out that way. What to do now, my guess buy as evey dip bought since March 2003 has worked I will let the trading gods prove this one to be different.

Market internals were horrible with 700 more losers than winners on the NYSE and 1,360 more losers than winners on the NAZ. The NDX had 15 up and 85 down; the OEX had 34 up and 66 down while the SPX had about 185 up and 315 down.

The TRIN indicator is a bit surprising as it closes at a bullish 94 while the up to down volume on the NYSE was 620M Green and 970M Red. So the up to down volume was a lot better than the advance decline lines.

Strongest sectors were retail, drugs, banks, trannies and homies while tech, gaming, semis, metals, brokers, software, internets and small caps were the worst. Not surprisingly, big cap value did the best, big cap growth second best, small cap value came in third and small cap growth did the worst.

Worst performers on the major indexes were LRCX NVDA KLAC AAPL AMT IBM DELL TXN CSCO and EK while winners were ABT NSC LTD BNI TGT XMSR SIRI TEVA and INTU.

THE FLIP

Markets have flipped to red on the heels of the Big Ben comments on deficits etc. Poor George W. must be a little ticked off now as Ben says:


Bernanke -spending on social security, other programs to put 'enormous pressure' on future US deficits.

Bernanke - Unless budget action taken early, unfair burden to be placed on future generations.

Bernanke -if tax rates to be kept low, must be special emphasis on keeping spending down too.

Bernanke - Economic growth alone not enough to solve impending U.S. fiscal problems.

Bernanke warns on potential for 'vicious cycle' with budget deficits fueling debts, interest costs.

Bernanke says U.S. Economy in 'calm before the storm' before entitlement spending surges.

I guess Big Ben is not big on the "we will grow out of deficits" approach.

Anyhow, the markets have moved lower on what appears to be the end of goldilocks as the DJIA is down 20, NAZ down 26 and SPX down 4.

The major indexes have held the first points of daily resistance at 12,550 on the DJIA and 1,425 on the SPX. Not sure they will hold the rest of the day but I will be watching those levels for support. The pivot on the DJIA is 12,580 and 1,431 on the SPX, so if we get back above those levels, well we will see.

MIXED OPENING

Markets open with tech stocks getting sold and oil stocks being bought on the heels of the big "sell tech" call by Jimmy Cramer.

Sector winners include oils, metals, retail, drugs, brokers, biotech and large cap value; to the downside are tech, semis, airlines, GOOG, small caps and gaming.

Interesting how with the sour tech outlook the NDX, lower by 8, still has about 55 winners to 45 losers while the OEX has about 75 winners and 25 losers. The big SPX has way more winners than losers with about 350 up and 150 down. Not sure if tech will bring the markets down or the big caps will bring techs up but I suspect the latter.

Market internals are +600 on the NYSE and -350 on the NAZ.

Key stocks including INTC GOOG AAPL GS ICE MS and KLAC are all lower while MER is higher by 34 cents after stellar earnings.

Leading the DJIA higher (24 up 6 down) are AA VZ T XOM PFE and HD while INTC IBM HPQ GE and KO are the biggest losers.

FUN TIMES FOR BLOGGERS

Premarket futures are trading near the flatline with the NDX futs getting hit the hardest.

On the wires, JEF beats by 4 cents; GES raises guidance; CME raised at Wachovia to a target of about $600; AAPL target raised to $107 at B of A; Mossberg reviews VISTA in the WSJ- and says "I believe it the best version of Windows that MSFT has produced; however, while navigation has been improved, Vista isn't a breakthrough in ease of use; Citi upgrades ERTS and INTU.


Jimmy Cramer out last night and this morning with the "can't own tech" mantra. Of course lets qualify that, we can stillown AAPL CSCO GOOG HPQ and MSFT. So we will track these five vs. XLK/MSH/SMH and QQQQ. I will also track the sell tech call against the overall markets (SPX). Sounds like fun, and what about LVLT, does that favorite spec stock qualify as tech and if so, is it also a sale here? Well the answer is probably if it goes up it wasn't and if it goes down, of course it was.

So here we go:

AAPL 92.74

CSCO 27.01

GOOG 494.5

HPQ 42.49

MSFT 31.08

XLK 23.16

MSH 575.62

SMH 34.1

QQQQ 44.79

SPX 1,430.62

TECHNICALS

After taking the lead for the first couple of week of 2007, tech and "the tech heavy nazdaq" have lagged the last few days on the heels of poorly recieved earnings numbers from INTC and AAPL.

The DJIA finished down 5, NAZ down 18 and SPX down 1. The semis, after starting the year strong have given back much of the gains yesterday and today.

Strongest performers today were metals, oils, homies, drugs and biotech; leading lower were semis, airlines, gaming, GOOG, trannies, tech, internets and small caps.

The SPX and OEX had about as many winners as losers while the NDX had about 7 losers to every 3 winners.

Big index winners were LINTA CHKP ABT F LEN and PHM while big losers were CPWR INTC AV CSCO XRX XMSR DISCA LVLT and SIRI.

The VXO is back on the radar as it now trades near the oversold level of 10 and about 10% below its 10 day SMA. And for folks that are interested, the QQQQ is back down to a 2 day RSI under 30 after hitting the high 90's a few days ago as the tech rally seems to be stalling on less than stellar tech news.

NOONER

Markets continue to trade mixed with the SPX/DJIA slightly higher and NAZ a bit lower.

Leading higher are metals homies, oils, drugs, software and small caps (growth); lower are gaming, semis, tech, brokers, banks, trannies and internets.

Internals have flipped and are currently green with NYSE +750 and NAZ +100.

Big indexes are about 55 green on NDX; 65 green on OEX and 300 green on the SPX.

Winners include PH LEN PHM CTX NOVL ORCL CAT SLB NTLI LINTA CHKP and ESRX while biggest losers are INTC LVLT TLAB RIMM CSCO HPQ UST LUV and GLW.

I continue to trade the YM DJIA Futures and the price has been holding a bit under the pivot but have now broken above and I expect they will continue to the 12,655 level, the first area of resistance. The action in the internals gives me confidence that this market will continue higher.

MIXED OPEN

Markets open mixed after a higher than expected core PPI sent the Futures lower at the 8:30 AM release.

Leading sectors include homies, oils, metals and drugs. Leading lower are airlines, gaming, tranies, brokers, semis, banks and tech.

The NDX is down about 6 with about 40/60 the ratio between winners and losers while the OEX is down a bit less than a point but also with a 40/60 ratio between winners and losers.

The SPX is lower by a point and shows about 220 winners and 280 losers.

Overall, market internals are flat on the NYSE and red 250 on the NAZ. The rate on the 10 year Bond is up a hair to 4.755%.

A surprising winner on the day is KLAC while LINTA NTLI ADSK and LRCX are the best performers on the NDX. At the bottom of the list are LVLT INTC TLAB LLTC NVDA and RIMM again.

And T Boone is looking for a bottom on crude at 48/50, and that would not be surprising if he was right.

RIGHT TO THE POINT

Markets move higher into the close as the DJIA Cash market was rangebound between the Pivot at 12,536 and resistance at 12,580.

The best performers today were the large caps followed by the middies with the small guys acting the worst. Value also beat out growth (barely).

Strongest sectors were gaming, reits, biotech, drugs, utilities and retail while semis, metals and oils lagged.

Market internals were also a mixed bag as the NDX was about 55 up and 45 down; OEX about the same and SPX about 270 up and 230 down.

Overall market internals were flat on the NYSE and red 250 on the NAZ.

Strongest stocks on the NDX were WYNN ERIC AAPL EXPD and ATVI while SYMC RIMM JOYG and LLTC were the worst.

The markets are still overbought according to my 2 day RSI indicator and if you want to read more about that indicator check out this article.

Big INTC report tonight and that stock trades like it wants to go higher regardless of what the fundys may say.

12:30 UPDATE

Like Dr. Brett, my daytrading revolves around pivot points, market internals and leading sectors. Today, however, the pivots on the YM DJIA Futures are a bit screwey because of the late surge in Friday's after market and the futures movement yesterday. Therefore, I have converted the DJIA CASH Market to futures and am using those points for today's trading. Resistance on the DJIA Cash is near the all time high at 12,582 and the pivot is 12,535.

I am anticipating a little late day move higher and have been buying the dips on the YM Futures.

Market internals continue in the positive category with +55/-45 on the NDX and OEX and +275/-225 on the SPX.

Strongest sectors include gaming (MGM leading the way up another $2.75), airlines, trannies, reits, defense, utilities, biotechs and retailers. To the downside are metals, oils, semis and tech.

AAPL and GOOG are very strong while the major brokers are trading mixed.

Overall market internals are +260 on the NYSE and +165 on the NAZ.

OPENING LOOK

Markets open slightly higher with the DJIA approaching its all day high in the 12,580 area. Notably weak are the recently outperforming semis/tech and some of the brokers.

Strongest sectors include gaming, trannies, reits, airlines, brokers, drugs and biotech while semis, metals, INTC AMGN are all weaker.

Market internals opened strong but have weakened with a 45/55 winner to loser ratio on the NDX ; 60/40 ratio of W to L on the OEX; and the SPX has about 300 winners and 200 losers.

Overall, internals are +600 on the NYSE and +360 on the NAZ.

Key stocks have GOOG +$1.25, AAPL +$1.4, GS FLAT, ICE -$.90, MER $-.35, and MS-$.35.

PRE MARKET GLANCE

Major market index futures are trading near flat with Friday's closing price after gapping up yesterday and early this morning. Apparently the markets sold off on the New York State Empire index which came in at 9.1 vs 20 consensus.

Crude is trading back down to the $52.25 level after slipping under the $52 area earlier.

On the wires, SYMC is trading down 8% on crummy numbers; MRVC is trading up 13% after gapping up Friday after the close on Cramer's recommendation; GES target has been raised $80 from $70 at Brean Murray; and LVLT is downgraded to a sell at Janco.

Barron's had its roundtable part 1 had one recommendation that looked interesting, BRNC. It is down more than 50% from its highs and appears to be selling at a cheap multiple and a very cheap price to book value ratio.