Markets continue rally

     Markets are in rally mode this morning on a continuation of positive momentum from the previous few days.  There hasn't been any major news out today to move the markets although the University of Michigan Survey of consumer confidence did come in better than expected. 

     The DJIA is up 60 pts so far as of 7:26 AM PST after earlier being up as much as 90 pts.  The SNP 500 is up 4 pts and the NASDAQ is up 10 points.  Gold rebounded after a recent selloff to 1795 and oil is down as well to 89.29 a barrel.

    Foreign indexes were all up nicely last night with the Japanese Nikkei up 225 pts and the Hang Seng index up 273 pts.  European stocks continued their nice run of late with the FTSE up 1% and the DAX up 2%.  The Euro traded down a half a percent and the dollar was up.

Stocks I'm watching

     RIMM- Research in Motion was down over 20% today after reporting bad earnings and poor guidance.  Apple is cleaning their clocks.  It could be a nice value play here as they have a ton of cash and some decent patents they could sell.  Blackberry is still pretty popular but the problem is their playbook tablet which few people are buying.

     NFLX-  Netflix is down another 8.5% today after dropping 20% yesterday.  This stock had been one of the best performing stock of the last 3 years.  It was trading at 300 a couple months ago and is now down to 156.00.  It is time to get out if you already haven't yet!  Their business model is now in question and short sellers are pressing the gas on this one.  There is more downside to come.

     AAPL- Apple is really flirting with the 400 level today but hasn't kissed it yet.  Apple is making a nice technical breakout past resistance at 393 and out of a triangle formation as well.  Also, RIMMs bad news is Apple's good news. 

     IAU-  Gold is bouncing back today after a vicious selloff yesterday.  Bargain hunters are stepping in and shorts are covering before the weekend.

5:00 PM PST update

     Today, was kind of an interesting day as there was a "risk off" flavor to the markets.  A lot of the stuff that had been rallying furiously the past 4 days took a back seat to the laggards.  Example, recent traditional safety trades like bonds, gold, utilities stocks and consumer staple stocks rallied today while small caps and european stocks lagged.  I don't know if the market is trying to tell us the rally may soon come to an end but it is worth monitoring for Monday.  For now, I remain positive as we had another nice upday continuing the momentum of the previous four days. 

     With oil dropping today and energy stocks lagging, I am looking for an energy play perhaps an oil service name like Transocean(RIG) or an E&P like Ultra Petroleum Corporation(UPL).  I have traded XLE this year but am looking for more of a targeted play. 

     That is five up days in a row for the markets which we haven't seen since June!  The SNP 500 was up 5.4% for the week.  I like this market right here and would be adding to longs ahead of the FOMC meeting next week.  It's been the best one week gain for stocks in over a year so let's see if we can continue the positive momentum for next week!