Weekly Market Summary For Week Ending Dec. 9, 2005
BY AL MARTIN
Trading results by Insider Intelligence traders for the week of Dec. 5- Dec 9, 2005:
In Monday the 5th’s trade, we SS CLF 60.00 C 59.75, S-4 CCH 1463 C 1447, S-4 LBF 336.80 C 333.30, L USH 111.16 S 111.20, SS CLF 60.25 CC 60.00, SS CLF 60.50 C 60.25.
In Tuesday’s trade, we SS HGH 199 C 198, SS CLF 60.00 C 59.75, SS CLF 60.25 C 60.00, L-2 USH 111.24 S 111.28, SS-2 HGH 2.00 C 199.40, SS CLF 60.25 C 60.10.
In Wednesday’s trade, we SS CTH 52.50 C 52.20, SS-2 HGH 199.50 C 198.90, SS-2 USH 112.10 C 112.06, SS-2 LBF 325.30 C 320.30, SS CLF 59.60 C 59.35, SS-5 OJF 123.50 C 122.90, L-2 DLX 91.55 S 91.75, SS SIH 8.95 C 8.90, SS CLF 60.15 C 59.90, SS-2 HGH 202 C 201.40, SS CLF 59.60 S 59.35.
In Thursday’s trade, we went L-2 KCH 94.70 S 95.30, SS-5 OJX 124.70 C 124.20, SS HGH 202.50 C 201.90, L-2 USH 112.01 S 112.09, SS-2 CCH 1463 C 1453, SS-2 LBF 327 C 325.50, SS CLF 60.00 C 59.75.
In Friday’s trade, we SS-2 CCH 1463 C 1453, SS-2 OJF 130.50 C 128, SS SIH 9.11 C 9.05, SS CLF 60.75 C 60.50, L-2 KCH 95.70 S 96.40, SS-7 CLF 61.25 C 60.85, SS-4 SIH 9.02 C 8.995, SS CLF 60.75 C 60.50.
For the week: We traded 40 positions comprising 69 lots, generating aggregate gross profits of $11,515, with net profit at $10,040. Unrealized losses carryforward as of end of week: $2,355.
(This is the first $10,000 net week InsiderIntelligence.com has had.)
LAST WEEK saw the SPX trade in a 22-point (1251-1273) regular session range, settling out the week at 1259.37, down 5.71 points, week over week, on overall marginally negative market internals, with the SPX now being twice turned back at the 1272/75 upside resistance level, as the SPX continues to form a bearish distribution pattern between 1250-70, with domestic common stock mutual fund inflows remaining tepid, at about $2 bil. weekly, being fully offset by smart money insider and offshore (smart Republican money) funds selling, with a growing negative now in the equation, namely, an increasing secondary offering calendar, with a record $10 bil. for the week, with 27.8% of the selling coming, directly or indirectly, from insiders, along with a record, dollar volume, amount of option bear spreading by insiders and the professional trade, coming, unusually enough, at the end of a historically weak period in equity prices, which ends in the coming week, followed by the historically strong year-end period, at a time when market leadership has broken down, shifting from the solid financials to the more speculative second-tier tech, mining & industrial sectors, which is, historically speaking, the most bearish change in market leadership, further coming at a time when the Dow is flirting with the 11,000 level, above which is a trillion dollars worth of ‘stale stock’ purchased at, or near, the old highs.
Thus, we continue to scalp the S&P’s from the short side, on rallies to 1263, or better, and will continue to do so until such time as the SPX 1280 level is broken, on both a definitive & closing basis.
In last week’s Treasury trade:
The USH contract provided consistent long-side scalping opportunities, on dips to 111.24, or less, and consistent shorting opportunities on rallies to 112.16, or better, particularly in late-week trade, when a surprisingly weak 10-year Treasury note option, in Thursday’s session, created an opportunity to short the USH’s in the 112.20-22 range, ultimately covering on Friday’s dip at the 111.28-30 area.
Expect a volatile upcoming week in the Treasuries, given an OPEC meeting, FOMC meeting, SPX re-balancing, a triple-witch Friday and a heavier economic calendar, full of bond-sensitive releases–i.e., retail sales, CPI, trade & current account deficits–all of which will provide trading points for the USH & DXH contracts.
In other futures trade last week:
The CCH contract continued to provide excellent shorting opportunities on rallies above 1450, covering dips at 1435, or lower, and we recommend waiting to see if Friday’s 1468 high can be breached, for fresh shorting opportunities.
Conversely, the KCH contract provided a series of excellent one-penny long scalps, buying at 95.00, or less, and selling at 96.00, or better, and we continue to believe the KCH is near-term oversold, and in need of a rally back to 1.00, to correct the condition.
Further, we continue to like scalping the CTH contract from the short side on rallies to 52.75, or better, for half-penny scalps.
The OJF contract, which we shorted above 1.30, in Friday’s upside blow-off, covering on the ensuing dip back to 1.28, continues to be a shorting opportunity on rallies above 1.28.
The SBH contract is now a screaming short, as we continue to look for a pullback & re-test of the 13.00 level.
We continue to scalp the HGH from the short side, with the contract looking tired in the 2.02-.04 range, and we continue to short the SIH contract on rallies to 9.10, or better, as we believe the contract to be near-term dangerously overbought, at current levels.
Individual equity issue traders should take note that we have now added a new short pick to our shorting list, namely, consumer products (tape symbol CPSS), an issue we expect to fall back to the $1-2. range, over the next 3 months.
As always, subscribers are welcome to e-mail us at firstname.lastname@example.org with their trading questions.