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Monday, December 13, 2010


He who watches paint dry certainly has an exciting existence. Effectively that's whats been going on in MLP land as its been sideways going on 3 weeks now.It has put the mlp index right along its 34 day moving average and its been straddling along it. All during this period the Dow Industrials have come back to its 2010 high and its also waiting to do something.The dow looks like it wants to breakout to new recovery highs but we're waiting for something ot make it happen. Last's weeks trading was pretty much an exercise in watching paint dry as we indicated in our opening line today.
The one chart that has made a decisive move higher is the 10 year yield (along with the 30 year) and we are in breakout mode. 3.40-3.50 is doable and we're just in push upward away from hitting that level. As i have said for weeks (and nothing over the weekend changes my view) that there is a tipping point where rising yields are going to cause a problem for the markets and for mlps. We are not there yet for the market. Maybe we're there for MLPS in the sense that we are giving up the flag of leadership. Certainly a more bullish economic outlook is a tailwind for mlps against the headwind of rising rates. The push and pull looks to continue. The end of year bias is higher and barring an outside event, i think we move sideways to higher overall through the rest of this month. Maybe the sellers went home for Christmas already and will be back on January 3rd.

Barrons over the weekend had a positive piece on 2 mlps; Plains All American (PAA) and Western Gas (WES). You need to be a subscriber to read the story. So look for some early upside in these 2 issues. No premarket trades yet but both stocks are bidding above the Friday close. Not much else happening on the news front this morning and no upgrades or downgrades so far.
Crude oil and nat gas are both higher as cold weather moves into the northeast today. The pattern looks cold for the rest of the month so that puts support under both markets. The dollar is down and stock futures are up ahead of the open.

Finally for those of you interested in getting some great coffee, I fixed the Mystic Monk link and it should take you right there for some very good brew. And thanks to those of you who have used the Amazon link above. 12 days until Christmas so plenty of time to get the gifts you need without going to the mall and dealing with traffic and all the rest of it!!!!

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