Daily Wrap
DJIA +36.71 (+0.28%); to 13,021.82 S&P 500 +6.02 (+0.43%); to 1,415.95 NASDAQ +20.25 (+0.68%); to 3,012.03
Today the S&P stayed green the entire day but did face a drop to near even just before noon time from Statements that Congress was not making headway on fiscal cliff talks but the market quickly recovered finally closing near where it opened up 6 points. I posted on Stock Twits today that the more congress speaks, the less I want to own and I truly meant that. The problem becomes, fundamental and technical work go out the window when headlines rule the day. Trading/investing have enough unknowns, I don’t need/like when a comment or two can cause real losses and “muddy” the picture.
Instead of going over the stocks in the News like normal, tonight I am going to cover some analyst comments and in particular those from Goldman Sachs today. You can see a larger list of analyst changes in the Upgrades/Downgrades section of the website.
The first, and upgrade of Research in Motion (RIMM). This was a trade idea of ours around $8.30 and we thought it could target the 200 day SMA. Once reaching there around the $10 level we said goodbye to the name but it was just getting heated up. In what looked like a short squeeze the stock rocketed up to $12 and then after a two day consolidation which actually brought it down to $10.20, the name took off again closing at 11.54 but reaching as high as 12.30 today. Goldman Sachs upgraded RIMM to a Buy this morning and laid a $16 price target which leaves over 30% upside if Goldman is correct. I saw let the name digest and look for a more clear pattern when the dust settles which might provide a better picture.
Another name Goldman Sachs likes and gave a Buy rating to was CarMax (KMX). Goldman had a Neutral rating and $32 price target on KMX before today and has now slapped a $42 target on the $36.24 stock. Give or take a few this would represent a 15% move in the stock. What I find interesting is KMX has a potential Cup & Handle formation which is more clearly defined on the Weekly (Chart Below). That would, from peak to valley, count KMX to around $50 but maybe it is foretelling that Goldman will have to up that target down the road.
Lastly it cannot be all roses and facing Goldman’s ire in the form of a down (actually a reaffirmation of a downgrade and lowering of price target) was Intel (INTC). The price target was moved from $20 down to $16. INTC is very oversold but this is also feeling like a name that will bottom with more of a base than a “V” and there should be trading opportunities that present themselves but I don’t need to try and catch the falling knife.
From the Event’s Calendar for tomorrow:
8:30 AM Core PCE Price Index;8:30 AM Personal Spending;8:30 AM Personal Income 9:45 AM Chicago PMI; 5:00 PM FOMC Member Stein Speaks
Back to the market. The SPY ETF was able to tag its 50 Day moving average today which the index technically didn’t. The intraday charts look like they want another push but I have to feel that at least for some short term move we have seen a top for a small drop or longer consolidation. Looking at the stocks above their MA’s I see some extended levels on the 10 day. Not signal itself I use that more for sentiment and nothing to really note on the other charts so again confirms that maybe some semblance of a short term top seems to be forming but that it could just end up being a pause and not a more substantial drop….yet.
