Hello traders everywhere! Adam Hewison here, co-founder of MarketClub with your mid-day market update for Wednesday, the 13th of March.
THE FACEBOOK - NETFLIX ALLIANCE
Today Netflix and Facebook announced a sharing of data. You can view this in two ways, either it's very destructive, "these folks are learning way too much about my habits," or you can look upon it as a business opportunity. For Netflix, I believe it is more of a plus than it is for Facebook. The new add-on service tells you about what movies your friends are watching and in-turn, it tells your friends what movies you are watching. This could be a very positive move for Netflix. We have been bullish on Netflix for quite some time (12/04/12 @ $89.45) and this is yet another strong signal that Netflix can move higher and over the $200 mark. At the present time, we have upside target zones of $200, $220 for this stock.
Facebook on the other hand, doesn't seem to be fairing quite so well this morning as it is under pressure in the marketplace. I think the deal favors Netflix and the market seems to indicating that is how it is also thinking. The trend longer term for Facebook remains positive, however the intermediate term trend is neutral to negative. We prefer to stand aside in this market, waiting for our intermediate term Trade Triangle to once again turn green.
THE ONE CURRENCY THAT GETS NO RESPECT
I continue to feel that the current upward trend for the Dollar is going to remain intact as the Yen continues to lose favor in the world's currency arenas. I also see the Euro gaining against the Yen. In fact, the Yen is the one currency that is not getting any respect in the marketplace. Pullbacks may occur, but the overall trend for the Japanese Yen at the moment is negative. As I mentioned on BNN TV on Monday, we are looking for the Dollar/Yen relationship to go to 100 Yen per Dollar.
Today, Italy's three-year borrowing costs rose to the highest levels since December. This was in large part due to the downgrade that the ratings firm, Fitch, gave to Italy last week. Italy is one area we have serious concerns about given the political instability we see in the country. Italy is the third most indebted country in the world after Japan and the United States.
We are going to be looking at 3 stocks that are in a bullish mode, they are:
IT'S GETTING CLOSER - CHAOS AHEAD
March 27th - Budget Resolution Expires
May 19th - Debt Ceiling Suspension Expires
Have a great trading day,