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Producer prices remain tame

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This morning's economic data shows that prices at the producer level remain tame and most likely will have the Fed at ease. The PPI rose just 0.2% in February, which was inline with consensus estimates. The core rate, which excludes the more volatile food and energy components was unchanged. Economists were looking for a 0.1% rise. Neither of these numbers look to be market moving.

At 09:15 AM EST, industrial production and capacity utilization numbers will be release. Then at 09:45 AM EST the University of Michigan consumer sentiment will be released.

In recent sessions I've talked about Kohls (NYSE:KSS) $69.97 as a potential bullish candidate for traders to be keeping an eye on and this will be a stock I'd be watching this morning when consumer sentiment numbers are released. Yesterday, the stock traded $70 and set off the "bullish triangle" pattern. Relative strength versus the broader market has been strong in recent months and support looks firm at the $65 level. The bullish vertical count is has been $85 since giving a double-top buy signal back in February at $70.

Another stock that looks to be getting ready to move ahead of the sunny summer months is shares of sunglass maker Oakly Inc. (NYSE:OO) $18.31. Yesterday the stock traded the $18 level, setting off a triple-top buy signal.

Oakley Inc. Chart - $0.50 and $1 box

Shares of Oakley (OO) look like they are ready to "spring higher" as the summer season approaches. The stock has been a good performer historically. Last year, the stock exceeded its bullish vertical count that was triggered in March (after red 3). Now we see a powerful point/figure chart pattern in the triple- top buy signal and bullish vertical count of $32. The OO August $17.50 calls (OOHW) are currently offered $3.20. Look to hold them into late May, early June. The company is scheduled to report earnings on May 15. Analysts are looking for $0.05 a share earnings, compared to year-ago $0.13. If today's consumer sentiment numbers are strong, this stock may be on a bullish traders list.

Stock futures hovering near unchanged

Stock futures are mixed this morning as the S&P futures trade higher by 2 points at 1,157. NASDAQ futures are lower by 6 points at 1,484 and Dow futures are unchanged at 10,535.

Fair value for the S&P 500 today is $2.70. HL Camp & Company has their computers set for program buying at $4.04 and set for selling at $1.76. Fair value for the NASDAQ-100 today is $8.62.

Jeff Bailey
Senior Market Technician
Option Investor

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