– Stock Market Companion – Current Holdings –

Nr.	Co.	Ticker	Action	Entry Date	Current Gain (Loss)
1	Alcoa, Inc.	AA	SOLD	1/3/2012	+5%
2	Dendreon, Inc.	DNDN	SOLD	1/11/2012	-2%
3	Mitek, Inc.	MITK	Holding	1/12/2012	+29%
4	EBAY, Inc.	EBAY	Holding	2/1/2012	+2%
5	Cree, Inc.	CREE	SOLD	1/18/2012	+18%
6	Apple, Inc.	AAPL	SOLD	1/30/2012	+9%

(Please scroll down to the end of the report to see your favorite benchmarks – Dollar, Oil, Gold … closing prices and daily direction.)

– Market Trends –

*Summary of terms from Trader Vic II-Principles of Professional Speculation (pg. 140-141)
*_________* Represents a change in trend rating.

– Market Perspectives –

For your added perspective, we’ve included this chart of the broader market (Successful stock investors develop and start with a minds-eye view of the broader market and keep it clear) –

SMC SP-500 ETF Daily Chart (Please click on the chart to see a bigger, easy to read chart on a separate browser tab window).

– Today’s Highlights –

Today the market was focused on perceived favorable news out of Greece that the legislature there had successfully passed the austerity package necessary to receive additional funding from the European Central Bank, European Union and the IMF.  At Stock Market Companion, we aren’t sure yet how this is all going to wrap up.  European Finance Ministers still have opportunities to veto what is going on.  That’s good – Because promises to make cuts from politicians are NOT worth very much.

This week is loaded with important economic data to be released –

Tuesday – January Retail Sales

Wednesday – January Industrial Production

Wednesday – Crude Oil Inventories ending 2/11.

Thursday – Initial jobless claims for last week.

Thursday – Housing starts and building permits

Thursday – Philadelphia Fed (Greater Philadelphia Area Business + Manufacturing Conditions)

U.S. political actions related to the Fiscal Year 2013 budget and upcoming payroll tax decision point.  February 29th marks the deadline for a decision on what to do about U.S. payroll taxes.  If nothing is done, they will return to 6.2% from 4.2%.  At this moment, conservatives in Washington are considering extending the payroll tax reductions through the rest of the year, without finding a way to fund these losses in revenue for the government.  This would be a return to the idea that somehow as a nation we can proceed with both tax cuts and no spending cuts, which we know doesn’t work.  We’ve proved that for the last decade – which is why we are in such terrible shape financially as a nation.

Today the price of oil jumped $2/barrel as tensions in the Middle-East rose between Israel and Iran.

All of the above items will have an impact on the markets.

From Friday, here’s what we know –

• The market is due for some form of pullback.
• The catalyst for this pullback was the trouble in Europe regarding Greece.  We covered this on previous days and in an SMC Intra-Day Alert early this morning.  See below.
• Some market leading stocks like Apple, Inc., have not yet shown much weakness (so the situation doesn’t YET look too grave, although this could change if Greece does default).
• Corporate earnings are good, but stocks have traveled a long way higher in many cases.  Strong profit taking can set-in.
• The U.S. economy is expanding slowly.
• Many stocks are behaving predictably.  There are some disappointments, like Dendreon (DNDN) however.  It’s come right back in from its excellent breakout.
• The employment situation in the U.S. – although bleak – has improved some.
• Opportunities are continuing to unfold – like Alcatel-Lucent this morning and others like Mitek Systems…etc…
• The banking industry and housing industry is in the early innings of “righting-itself”
• We have followed our S.I.M.P.L.E. investing strategy and engaged the market well at key transition points.
• The Federal Reserve is being very accommodative – which is good for stocks.

– S.I.M.P.L.E.  Stock Investingtm –

– (Where each investment begins with a Story and ends with Earnings) –

S.I.M.P.L.E. Stock Investing is built upon these core concepts –

S = Story (What is / are the key catalyst(s) behind the company of interest?)

I = Investor Interest (Is the stock chart showing investor interest = buying or share accumulation?)

M = Market (Is the background market favorable for investing at this time?  Don’t Fight the Market! We know the vast majority of stocks move in the direction of the overall market).

P = Person or Product (Is there a particular person or product that makes the story work for this investment?)

L = Leader (Is the company a leader in its industry group or is its product a leader in its market?)

E = Earnings (Are current quarterly earnings and annual earnings growing?)

Please click here for a SMC Successful Investing Video (5 minutes) that provides an overview of the broader market, and two stocks of interest that we brought to your attention on Friday –

Alcatel-Lucent (ALU $2.19)

Clearwire (CLWR $2.27)

– Benchmarks “At a Glance” –