Citigroup (C) - Quick Takes Pro Chart of the Day

[Blaine Tarr]

"Buy in April, Sell in May" isn't effective so far this year, stocks continued to stay under water, where the S&P500 is returning -2.63% since April started. On the other hand, the bond buyers are enjoying a cheerful time with the weak economic releases recently, the Treasury yields curve fell sharply where the 2yr and the 10yr went down 14bps and 37bps respectively. Aside from the technical, first quarter corporate earnings are reporting strong numbers as Alcoa, Google, JP Morgan and Wells Fargo were all outpacing analysts' estimates on both EPS and revenues; stocks price reactions were mainly positive, which should be a good sign for stock going forward. Investors will continue to focus on more companies' earning announces, also retail sales and the leading indicators are also important on the economic front.

Technical Highlights:
? Stocks remained its downtrend; Positive corporate earnings surprise may help the market to end this short-term correction.
? Market suffered from short-term bear cycle as both the S&P500 and the NYSE Composite turned below their 50day moving average; Internal showed sign of market bottom as the percentage of stocks above 50day moving average are turning to its extreme.
? RSMC continued to rally along with market correction, however the extreme have not appear yet to signal the change in trend.
? Financials led market selloff as the market neutral group (energy and materials) made its biggest daily return this Thursday.
? Bonds are now back to the bullish trend as rates are now trading below their 50day moving average across the entire yields curve.

[Blaine Tarr]

Anyone invested in companies making RFID or the associated tracking software?

[Blaine Tarr]

The dollar printed its daily cycle low on Tuesday of last week.
The dollar peaked on Thursday, which was day 2.

[Blaine Tarr]

FormFactor, Inc. (NASDAQ:FORM) - Over the last 52 weeks the stock has ranged from a low of $4.68 to a high of $11.05. FORM stock has been showing support around $5.16 and resistance in the $5.50 range. Technicals have turned bullish signaling sideways to higher prices possible in the near term. Chart is showing a Bullish MACD divergence. Positive divergence occurs when MACD advances upwards at a time when the price is still in a down trend. MACD forms a sequence of higher lows ( each low higher than the previous day or period ). The daily RSI remains above the 50 level and the MFI is moving up strongly, showing the increasing of money inflow. This could explode on any positive news due to the high short interest compared to float and the solid cash. It is a ludicrously cheap name currently trading at 1x cash flow amazingly undervalued by today's standards. They have now a market cap of under $262 Million with 296 Milion in cash and no debt. I know the market sometimes is bad but this is ridiculous. FORM is a low volume small cap that may be poised to move higher.

More breakout alerts for Tuesday : Stocks To Watch Next Week

[Blaine Tarr]

Television's Jon Erlichman reports on Facebook Inc.'s expansion plans in China.

RENN is one of the candidates Facebook Said to Seek Partner to Enter China

Technical view : The stock has been forming a large pennant pattern on the daily chart over the last few weeks, popped on good volume and retreated on lower volume. It looks like it may be starting to gain some momentum again and should make a move soon. The Pennant is a continuation pattern, that is marked by a small consolidation before resumption of the previous trend. In addition, the MACD Fast Line is about to cross up through the Slow Line,

[Blaine Tarr]

I've been following Tyler Durden for a while now. He is certainly the straw that stirs the drink lately.


For the uninitiated HFT or High Frequency Trading now RULES all major equity markets. Estimates are 70% of all volume is HFT. For that matter, the exchanges are effectively held hostage by these firms. This I am confident in my belief. Trading curbs - gone, Uptick - gone. There can be no doubt the HFT contingent made these changes a reality.

What is HFT? There are several strategies - many legit. In fact, all are technically legit. But the one strategy garnering the most press, and most outrage are flash orders.

Flash orders are small orders that "ping" the market continuously. They have a life span of milliseconds and are not placed to buy or sell stock. Flash orders have one aim. To determine order flow. Its not unlike Jesse Livermore's strategy of tossing out a couple market orders to discern how the market takes them. However, these orders are rarely filled. On high liquid stocks....they are constant. They last literally milliseconds before they are cancelled. These algorithm's sole design is to find out what you want to buy, the price, and buy it before you because they have the competitive advantage of robust servers that are located within the exchange and sell it to you a tick or two higher. For this, the exchanges pay them a rebate for "providing liquidity". They get paid up to 1/3 of a penny by exchanges. So, on a $20 stock. By buying and selling at $20 - they make 2/3 of 1 cent. Doesn't sound like much. Well, as I said, these orders are constant on high volume liquid stocks. And when you add that to the tick or two profit they make on a trade......It can quickly add up.

My basic beef with this is 1) These firms pay the exchanges to place their servers at the physical exchange to reduce milliseconds in order placement and cancellation. 2) The rebate. These two advantages are not offered to retail traders. 3) The exchanges are so unbelievably desperate to compete that they have become hostage to what amounts to 2% of all market participants at the expense of the remaining 98%.

With everything that I think I know, I don't like firms being paid by the exchange to trade. I think it goes against the central tenant of an free and open exchange. Using the available technology to one up your competitors, of which, we all are, is what capitalism is all about. You could become a broker dealer, gain access, and place your servers at the exchange if you had the physical and intellectual capital to do so. So, in that regard, I don't think I have a problem with the strategy. There are hundreds of such firms competing against each other for your order and to game each other. But, I may be mistaken on this, specialists or market makers were never paid by the exchanges. I can conceive an argument that the rebate lowers the margin for the HFT traders and can therefore offer narrower spreads, thus, in theory, reduce transaction costs for the public. However, I don't think that is what is happening in practice.

[Blaine Tarr]

Barchart.com's Chart of the Day - Salesforce.com (CRM) for Apr 13, 2012

The "Chart of the Day" is Salesforce.com (CRM), which showed up on the Barchart "All-Time High" list. Salesforce.com posted a new all-time high of 161.69 and rallied 2%. TrendSpotter has been Long since Jan 20 at $114.19. In recent news on the stock, MKM Partners on April 10 initiated coverage on Salesforces.com with a Buy and a target of $85. Canaccord on March 28 reiterated its Buy rating on Salesforce.com and raised its target to $180 from $170. Salesforce.com, with a market cap of $21 billion, provides a suite of on-demand customer relationship management (CRM) software applications that allow customers to manage and share all of their sales, support, marketing and partner information on-demand.