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Sterling
Weekly for February 13th, 2006
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I am a little
pressed for time this week,
but I wanted to make a couple
of comments on a few items I
felt were worth paying attention
to. With respects to the overall
market; I continue to see reason
to believe that the recent activity
is anything more than a normal
round of profit taking following
a strong move upwards in early
January.
Second, the
Treasury auctioned off 30 Year
Long Bonds for the 1st time
in 4 years (I thought it
was 8, but I stand corrected.)
last week. From looking at the
chart of the CBOE 30-Year Treasury
Yield Index 'TYX' it shows the
type of movement one would expect
to see as demand was strong
for this bond partially due
to what I believe is its desirability
to those who have long term
liabilities to manage. My comments
on the 30-Year Long Bond from
last week can be found (here).
I'll revisit this issue again
in a few weeks when I think
things have settled into a clearer
picture to analyze.
The Dow Jones
Industrial Average (the Dow)
is designed to reflect the overall
economy, which at the time of
its creation was much more involved
in manufacturing than it is
today. However the Dow has been
periodically updated to reflect
the changes in the economy.
The Dow Jones Transportation
Index (the Transports) is designed
to reflect the industry of transporting
goods and services throughout
the economy. Pretty basic concepts.
The Dow is the most accurate
predictor of where and how the
economy will be performing approximately
6 months from now. The basic
"Dow Theory" holds
that a strong economy will also
require the shipment of those
goods and services, hence any
sustainable move higher in the
Dow and growth in the US economy
will be confirmed by the same
movement to new highs by the
Transports. Below I have posted
a chart on the Dow and a chart
on the Transports. The trend
on both has clearly been higher,
and they both have recently
set multi-year highs. I do not
see any reason to doubt the
strength in the US economy or
the intermediate to long term
direction of the market.
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| Sterling
Calendars for the Week of February
13th, 2006 |
| Date: |
Comments: |
| 2/13 |
Cendant Corp. 'CD'
reports earnings at 4:00pm. Est. $0.23/share. |
| 2/13
|
Glamis Gold 'GLG'
reports earnings before the open.
Est. $0.10/share. |
| 2/13 |
Harmony Gold 'HMY'
reports earnings at 1:00pm Est. N/A |
| 2/14 |
Abercrombie &
Fitch 'ANF' reports earnings after
the close. Est. $1.78 |
| 2/14 |
Cephalon, Inc.
'CEPH' reports earnings after the
close. Est. $0.78
|
| 2/14 |
Deer & Co. 'DE'
reports earnings before the open.
Est. $0.83 |
| 2/14 |
Marsh & McLennan
'MMC' reports earnings before the
open. Est. $0.31 |
| 2/14 |
Waste Management
'WMI' reports earnings before the
open. Est. $0.40 |
| 2/15 |
Biogen 'BIIB' reports
earnings after the close. Est. $0.48 |
| 2/15 |
Ceridian 'CEN' reports
earnings before the open. Est. $0.25 |
| 2/15 |
Hewlett Packard
'HPQ' reports earnings. Time N/A.
Est. $0.44 |
| 2/16 |
Baker Hughes 'BHI'
reports earnings before the open.
Time N/A |
| 2/16 |
Cabot Oil &
Gas 'COG' reports earnings after the
close. Est. $1.11 |
| 2/16 |
Dell, Inc. 'DELL'
reports earnings after the close.
Est. $0.41 |
| 2/16 |
JCP Penny 'JCP'
reports earnings. Time N/A. Est.
$1.63
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| 2/16 |
Lowes Corp. 'LTR'
reports earnings before the open.
Est. $2.09 |
| 2/16
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Nvidia Corp. 'NVDA'
reports earnings. Time N/A. Est $0.49 |
| 2/16 |
Target Corp. 'TGT'
reports earnings. Time N/A. Est. $1.05 |
| 2/16 |
XM Satellite Radio
'XMSR' reports earnings before the
open. Est ($0.90) |
| 2/17 |
Radio Shack 'RSH'
reports earnings before the open.
Est. $0.68 |
| 2/17 |
Sirius Satellite
Radio 'SIRI' reports earnings before
the open. Est. ($0.22) |
| 2/17 |
Stifel Financial
'SF' reports earnings. Time N/A Est.
N/A |
The
full earnings calendar for this
week can be found (here) |
|
Prime
Update:
Sterling
Investment Services is an investment research
and money management firm publishing the
Prime
Stock Newsletter. The Prime
Stock Newsletter is a daily comprehensive
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Highlights
from Recent editions of the Prime
Stock Newsletter |
| Recommendation |
Date |
Entry
Point |
Recent
Close or Exit Price |
Profit* |
Note |
| Advanced
Micro 'AMD' |
Nov.
7th |
$24.63 |
$37.46 January 12th
intra-day high. |
$12.835 |
|
| Capital
One 'COF' |
Dec.
19th |
$85.74 |
$89.14 January 11th
intra-day high |
$3.40 |
|
| Gold
Corp. 'GG' |
Dec.
29th |
$21.72 |
$25.29 |
$3.48 |
Should continue
to move higher. |
| * The
per share PROFIT is a theoretical
calculation based upon the opening
price the day the recommendation is
published and the intra day high (or
low for short sales) on the exit day.
The exit day is determined based upon
the application of our "Rules
for Trading", the implementation
of "stops" within our stated
policy, and may not reflect the complete
or full movement of the underlying
recommendation. |
|
Dow Jones Industrial
Average (INDU)
Current
Opinion:
Closed @ 10,798.27 Last Signal:
Called Lower with the close of 10,793.62
on February 3rd.
Current Expectations: I am expecting
the Dow Jones Industrial Average to
move lower and test 10,667.39 on a closing
basis.
|
The
S&P 500
Current
Opinion: Closed
@ 1,265.02 Last Signal: Called
Lower with the close of 1,264.03 on February
3rd. Current Expectation: I am
expecting the S&P 500 to continue
to move lower and test
1,248.29 on a closing basis. |
The
NASDAQ 100 (NDX)
Current
Opinion:
Closed @ 1,657.54 Last Signal:
Called Lower with the close of 1,664.53
on February 3rd. Current Expectations:
I am now expecting the NDX to continue
to move lower and test 1,645.20 on a closing
basis. |
CBOE
Ten Year Treasury Index (TNX)
Current
Opinion: Closed
@ 4.545% Last Signal:
Called Higher after the close of trading
on January 26th with a close of 4.523%
Current Expectations:
This index should move higher and test
then 4.567% and then 4.657% on a closing
basis. Note: I am not
seeing a real clear signal on this index.
It could easily go either way. |
Disclaimer:
The Sterling Investments series of newsletters is produced by Sterling
Investment Services, Inc. All information
used in the production has been obtained
from sources believed to be reliable and
accurate. Sterling Investment Services
does not warrant or assume any liability
for inaccuracy of the information used
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If you would like to contact us our fax
# is (404)-816-8830 Email address is:
enelson@sterlinginvestments.com Sterling
Investment Services may hold positions
in the securities recommended or may be
providing consulting services to the companies
mentioned within this report. |
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