Investors 411 Blog

by Barr Jozwicki
August 31, 2009

Market Update – Teddy

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , , , , ,

Teddy

VictoriaKennedyGetty

Vicki Kennedy/Teddy’s Wife – photo Chris Hondros/Getty

Teddy Kennedy was once told he was the most effective legislator since Daniel Webster . He deadpanned in reply – "what did Webster do." You can view Obama’s eulogy of Kennedy "The Lion of the Senate" HERE You can read it HERE

Kennedy was such an effective legislator, his funeral this weekend rivaled that that of former Presidents or unfortunately Michael Jackson.

One of his adult sons told a story that was personal and for me exemplifies the hopes for all America. See full eulogy HERE

About 4 minutes into this eulogy he tells the following story.

When this son (Teddy Jr.) was 12 he lost his leg to cancer and a few month later there was a heavy snow storm and they went sledding. As he started to walk  his artificial leg gave way on the ice. He fell and started to cry, claiming he would never be able to make it up or down the hill. Teddy took him in his arms and said that they would make it together even if it took all day. They did. – The lesson he learned was even our most profound losses are survivable. That we can transform those horrible events into something positive.

His son ends his eulogy with the same words Teddy used at the funeral of  Robert Kennedy

"The work goes on, the cause endures, the hope still lives, and the dream shall never die "

US Profits from Repayment of Big Bank Loans

Is the TARP program working? Seems the NYT is headlining the story the  8 biggest banks have started to or repaid their government loans (TARP program) and we the taxpayers have made a $4 billion dollar profit. LINK

If you combine this with the almost unbelievable stock price run the most trouble financials have had over the last two weeks (AIG, B of A, C, Fannie and Freddie) you have to get the feeling Wall Street believes that the whole bailout program is working.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow -0.38% up
NASDQ +0.05% up
S&P500 -0.20% up
Russell2000 -0.67% -

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals and Fundamentals

It seems that almost all Technical analysts (from watching the financial channel and most sources I look at) expect some sort of correction – 5 to 10% if you’re bullish to the sky is falling if you’re an ultra bear. If you look at a chart of the major indexes over the last 4 trading days they have all opened and closed at almost the exact same amount. This is called "churning" and usually indicates a reversal in direction.

Therefore, FEARLESS FORECAST – is for a down week . The problem with this forecast is that it is too obvious.

The dollar, right now seems to be key factor in which direction markets move. The rise in the dollar countered some good news in stocks, especially for tech stocks . Intel increased its earnings forecast and Dell had a better than expected earnings report.

Jobless claims, although a lagging indicator, has become very important to short term stock prices. The report for August comes out Friday . Basically what’s expected is a job loss of the same as last month and the unemployment figure to rise from 9.4% to 9.6%.

WSJ is carrying a story about default in business real estate mortgages . LINK The graph is ominous, but the last two months have shown a drop. The default rate is at 3.14% which means 96.86% are not defaulting and the vacancy rate is not as high as it was in 2003. This may turn into a crisis, but right now the short turn momentum is in the opposite direction.

——–

S ignificant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI The Baltic Dry Index measures the flow of goods by price (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern .  The BDI fell -04 yesterday. For right now it looks like the major technical support level is holding. Unfortunately, we have created a lower low that confirms both the mid term trend . The mid term trend since early July is clearly bearish, with a series of lower lows and lower highs. @ 2298 is a major area of support and the BDI has fallen since early June from 4291 to 2427.  This is just 129 points away from a major support level.

Technically, A flattening of the BDI is to be expected because it is near a major support level.  The big question is will support hold.

In a nut shell the BDI is

  • short term - Bearish pattern
  • mid term Bearish pattern
  • long term - Bullish pattern

Bottom Line Mid term trend is not good for world markets, especially countries that rely on exports. This is why countries that rely on exports are NOT now doing as well as the USA .

While this index does not have as immediate impact on stocks, as the Dollar does, it is very significant to long term worldwide economics.

——-

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

The dollar was rose +0.31 % Friday. The Dollar is in a range between $79.5 and $77.5 . A breakout to either side will seriously impact stocks. Dollar closed at $78.30. Its  major support level is @$77.5 & it has 2 major resistance levels – a falling 50 day moving ave. at $79.20 and the August highs of @ $79.5 .  If it breaks down through support stocks should rise, if it breaks up through resistance stocks should fall.

Mantra Dollar up = US stocks down & Dollar down = US stocks up

This is the index to watch because its impact is immediate.

Positions

The whole Positions Section has been revised (Click on "Positions" at top of blog). Check it out

EWY (S. Korea) was bought at $39.9 and sold at $42.4 for a 6+ gain

Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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August 27, 2009

Market Update – A Fundamental Right

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , ,

An Outsider Looking In?



California Nurses Association photo

Rose Ann Demoro has to go outside the USA to be heard  on the health care issue in the USA. From the Ottawa Citizen (Canada) her editorial LINK or another editorial in the London Time s LINK

She finds the distortion – about death panels, the Canadian system, & phony threats to medicare changes "incomprehensible." She faults Obama & Democrats for not pursuing their election mandate. Obama "gambled" that if he compromised he could bring some Republicans along and "effectively gutted" his strongest allies those passionate about caring for others.

Many on the left are starting to look at health care reform as more another corporate give away than reform.

Her conclusion

" Among major nations, only in the U.S. is health care not a fundamental right, but bartered for profit by a maze of health-care corporations. The result is that the U.S. continues to fall far behind other industrial nations in a variety of measurements, from access to care to equality in treatment, and even in the much discussed issue of waiting times for medical care.

While the U.S. spends twice as much as every other nation on per capita health care, there remain more than 45 million Americans with no health coverage and tens of millions more with insurance who are routinely denied medical care because their insurer doesn’t want to pay for it.

Medical bills account for 62 per cent of personal bankruptcies. Half of all Americans skip doctor visits or immunizations for their children because of high out-of-pocket costs, troubling news indeed with the U.S. already leading the globe in swine flu infections and deaths.

The nation’s registered nurses and many doctors continue to press for real change, a national or single-payer system that would look familiar to Canadians and the rest of the industrial world. It is still possible to achieve stronger reform, but time is running out.

Rose Ann DeMor o is executive director of the 86,000-member California Nurses Association/National Nurses Organizing Committee, the largest U.S. union of nurses.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow +0.04% down
NASDQ +0.01% up
S&P500 +0.10% down
Russell2000 +0.14% -

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals and Fundamentals

This is a market that is overbought and ready to reverse itself. Again we had a some positive fundmentals (signs of economic recovery) according to CNBC (financial channel). But a rise in the dollar probably contributed to holding stocks back.

For the last 3 days the charts of the major indexes have opened and closed near the same levels. This usually indicates at least a short term reversal or trend .  Because the volume is low it is not confirming the move. However, if you look at volume cumulatively (3 days) it adds up.  So perhaps  small reversal is in the works.

The dollar, right now seems to be key factor in which direction markets move.

Jobless claims, although a lagging indicator, has become important to short term stock prices.

Best read of tea Leaves – This is all the calm before the September storm when everyone gets back from vacation and we get more employment data. If you’re a long term bull a flat market right now is good news because anything that goes up too far to fast usually gets spanked.

Common thought among technical analysts is the markets have risen too far too fast and are due for a correction.

——–

S ignificant forecasting tools/Indexes for stock markets

BDI The Baltic Dry Index measures the flow of goods by price (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern .  The BDI rose +39 yesterday. For right now it looks like the major technical support level is holding. Unfortunately, we have created a lower low that confirms both the mid term trend . The mid term trend since early July is clearly bearish, with a series of lower lows and lower highs. @ 2298 is a major area of support and the BDI has fallen since early June from 4291 to 2468.  This is just 119 points away from a major support level.

In a nut shell the BDI is

  • short term - Bearish pattern
  • mid term Bearish pattern
  • long term - Bullish pattern

Bottom Line Mid term trend is not good for world markets, especially countries that rely on exports. This is why countries that rely on exports are NOT now doing as well as the USA .

While this index does not have as immediate impact on stocks, as the Dollar does, it is very significant to long term worldwide economics.

——-

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

The dollar was rose +0.49 % yesterday. The Dollar is in a range between $79.5 and $77.5 . A breakout to either side will seriously impact stocks. Dollar closed at $78.61. Its  major support level is @$77.5 & it has 2 major resistance levels – a falling 50 day moving ave. at 79.19 and the August highs of @ $79.5.  If it breaks down through support stocks should rise, if it breaks up through resistance stocks should fall.

Mantra Dollar up = US stocks down & Dollar down = US stocks up

This is the index to watch because its impact is immediate.

Positions

The whole Positions Section has been revised (Click on "Positions" at top of blog). Check it out

EWY (S. Korea) was bought at $39.9 and sold at $42.4 for a 6+ gain

All our other outstanding positions that have been held over a month FXI, EWZ, GLD , (gold)  are doing well – especially China & Brazil.

Our new positions in XFL (financials) and SPX (S&P 500) are up a smidge.

Waiting for a pullback to add to positions.

Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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August 26, 2009

Market Updates- Lies of Mass Distruction

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , , , ,

Teddy

Teddy Kennedy he Liberal Lion of the Senate died. You have no idea how much legislation he was responsible for in helping the poor, and those in need. In 1969 he was the first to introduce universal health care.  BBC editorial LINK

“Near universal is the view that he was Washington’s most influential lawmaker of the past 50 years, which is all the more remarkable given that he was such a polarizing politician.
Civil rights. Disability rights. The minimum wage. Immigration. Education. Campaign finance reform. And his signature issue, healthcare.”

Without Kennedy’s early support Obama would NOT be president. Will Obama support a health care plan that would make Teddy proud.

Lies of Mass Destruction

Why do we believe in the lies, even when we know the truth ? Remember the Saddam had  WMD’s and was behind 911 lie. 73% of Americans still believed the later in 2004. Who knows how many still believe it today.

In psychology its called cognitive dissonance – When you’re confronted with the truth that contradicts your previously held belief you fall back on the emotional attachment to that belief. You react defensively, ignore the truth, seek out only information that confirms your belief or discredit the source. MIT study LINK

The exact same thing is happening with all the  misinformation and screamed lies on the public health care.  Newsweek’s Sharon Begley explains why this occured with health care. LINK

Factcheck.org is always a great LINK


STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow +0.32% down
NASDQ +0.31% down
S&P500 +0.24% down
Russell2000 +0.51% -

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals and Fundamentals

This is a market that is overbought and ready to reverse itself. The Bernanke news & the second month in a row of increased housing prices in the USA should have produced a bigger rally. Even oil prices cooperated and dropped -3.12% without the dollar rising. All this good news produced a meager weak volume rally on Wall Street. How markets react to news out #2 forecasting tool (behind volume).

Financials are the key and it sure looks like and dip should be bought into.  The fact that housing prices have rallied two months in a row starts a trend. One month could be a fluke, but the second month gives you confirmation. Who is the biggest owner of homes outside of individuals? – Banks -  Yet another reason to invest in this sector.

——–

Significant forecasting tools/Indexes for stock markets

BDI The Baltic Dry Index measures the flow of goods by price (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern .  The BDI fell - 49 on yesterday. Unfortunately, we have created a lower low that confirms both the mid term trend . The mid term trend since early July is clearly bearish, with a series of lower lows and lower highs. @ 2298 is a major area of support and the BDI has fallen since early June from 4291 to 2468.  This is just 80 points away from a major support level.

In a nut shell the BDI is

  • short term - Bearish pattern
  • mid term Bearish pattern
  • long term - Bullish pattern

Bottom Line – Mid term trend is not good for world markets, especially countries that rely on exports.  This is why countries that rely on exports are NOT now doing as well as the USA.

While this index does not have as immediate impact on stocks, as the Dollar does, it is very significant to long term worldwide economics.

——-

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

The dollar was unchanged -0.01 % yesterday and,  what started out as a rally for stocks pulled back into modest gains . The Dollar is in a range between $79.5 and $77.5 . A breakout to either side will seriously impact stocks. Dollar closed at $78.24. Its  major support level is @$77.5

Mantra Dollar up = US stocks down & Dollar down = US stocks up

A gradual reduction in the price of the dollar is part of the solution to global worldwide recession

This is the index to watch because its impact is immediate.

Positions

The whole Positions Section has been revised (Click on “Positions” at top of blog). Check it out

Because of the breakdown of the BDI (world trade) & the bullish trend in financials (see last few posts) Investors411 is cutting investments in foreign countries and building investments in financials.  ETF’s in India,  & Singapore ETF’s have been sold. Taking profits in EWY (S. Korea)(see positions)

Have added a 5% position in XLF (financials) late last week.(see positions) Looking to “buy the dips” and build on this.

Your Comments

Paul R has a very important comment (see right hand side of blog.) There are 3 ETF’s that track financial stocks XLF, (tracks the financial sector) UYG (2X financials) & FAS (3X financials)

XLF is for the conservative investor. To trade UGY you’re taking a bigger risk and FAS is even a greater risk. Most people who trade these ETF’s are day traders or swing traders (day traders who are willing to hold a position for over a day) I do not often mention my personal trades in these because most of you are longer term investors.

First you have to have the time to do this. When I’m involved in trading UGY or FAS I have CNBC (the financial channel on as background while I work) You must have a clear defined entrance and exit strategy.

  • Here’s mine – I usually wait for FAS to fall @5+% on a technical pullback – there’s no earth shattering bad financial news. Sometimes I wait for a pause in the rally.
  • I look at the technicals – the support resistance levels.  Example – A support level breaks and there is panic selling – then you buy.
  • I make the trade and set a @5 to 7% stop/loss (If you don’t know what a stop/loss order is you should NOT be making this trade)
  • I set an amount that I will sell at in advance. Usually a 7 to 10% gain.

FAS chart LINK – As you can see a 5 to 10% gain/loss in FAS is common over a few days.

Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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August 25, 2009

Market Update – Bernanke

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , , , ,

Ben Bernanke

The NYT reports this AM that the Obama administration will keep Bernanke as Fed chair LINK Investors411 praised the choice of Bernanke as Fed chair & think its not a good idea to change horses in mid stream.

Bernanke shares some of the blame for allowing the financial meltdown, but not nearly as much as much as Greenspan . Greenspan in front of congress admitted his error.  He thought that the free markets could regulate themselves. Boy was he wrong .

As stated before a combination of the Fed chair and the Obama administration’s stimulus and loans have pulled the back from the edge of the economic cliff.

Official announcement at 9:00AM EST this AM.

Medicare, Social Security,& Health Care

These programs on the whole have been decently run by the federal government.  The problem is that post World War Two we had a population explosion called “the post war baby boom” That population explosion in the late 40′s and early 50′s is reaching maturity and will be using the assets in those programs. Thank God Lehman Brothers or the Free Market is not running these programs

The best proven  justification for a public health care option is all the other industrialized democracies (dozens) have voted to have public systems and none have voted to remove them. However American’s are so egocentric, that what generally works in other countries has less meaning here.

Economics 101 & the Recession

What the Fed and the administration have done is stimulate growth.  What they are trying to do is keep the growth alive and hope shadow banks can wind down debt. At this point, using stock prices as a measurement, this is working.  This argument is a gross oversimplification, but rally right now confirms this outlook.


STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow +0.03% down
NASDQ -0.14% down
S&P500 -0.05% down
Russell2000 -0.22% -

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals and Fundamentals

This is a market that is overbought and ready to reverse itself.  The Bernanke news should be good news for stocks.  However markets that need a temporary reversal (overbought) and after the rally we should see some immediate selling.

Again, check out these financials – especially the huge volume. The one fundamental that is the driving force behind the stocks surging is financials – Lets take a look at the price charts worst of the worst.

These are the companies (AIG, CitiGroup & Fannie Mae) that were among the leaders on the downside and the trend is clearly higher.  (See above editorial) The trend is your friend and let’s ride it.

——–

Significant forecasting tools/Indexes for stock markets

BDI The Baltic Dry Index measures the flow of goods by price (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern .  The BDI fell - 31 on Friday . We’ve again broken a support level and formed another lower low. The rat of decline is slowing, which means a reversal is coming. Unfortunately, we have created a lower low that confirms both the mid term trend. The mid term trend since early July is clearly bearish, with a series of lower lows and lower highs. @ 2298 is a major area of support and the BDI has fallen since early June from 4291 to 2468.  This is just 129 points away from a major support level.

In a nut shell the BDI is

  • short term - Bearish pattern
  • mid term Bearish pattern
  • long term - Bullish pattern

Bottom Line – Mid term trend is not good for world markets, especially countries that rely on exports. exports

While this index does not have as immediate impact on stocks, as the Dollar does, it is very significant to long term worldwide economics.

——-

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

The dollar rose +0.25 % yesterday and, you guessed it, the stock rally stalled . The Dollar is in a range between $79.5 and $77.5 . A breakout to either side will seriously impact stocks. Dollar closed at $78.24. Its  major support level is @$77.5

Mantra Dollar up = US stocks down & Dollar down = US stocks up

A gradual reduction in the price of the dollar is part of the solution to global worldwide recession

This is the index to watch because its impact is immediate.

Positions

The whole Positions Section has been revised (Click on “Positions” at top of blog). Check it out

Investors411 will become more involved in the financial sector. – ETF’s – XLF. UGY (2x financials) & FAS (3X financials) Investors411 will also be taking profits in some.  – Even though its not a dip lets start small and reopen the  position in financials…. Up to 20% of portfolio

The Hedge – At one point we had almost a 5% gain in this position that hedge the NASDQ 100 against the S&P.  The growing trend in financials has wiped that all out.  Investors411 is closing this position because it looks like financials will continue to drive the S&P higher. Yesterday there were massive trades (again) in those financials (shadow banks) that needed the biggest bailouts.

Closing position for zero gain.

One very important rule in investing is don’t lose money.  Fundamentally this trade is turning sour.

Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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August 24, 2009

Market Updates – Change in Investment Strategy

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , , , , ,

Paul Krugman

Armed with the Nobel Prize & a NYT column, the Chair of Princeton’s economics department, the vocal Paul Krugman, is perhaps the world’s most talked about economist.

Today he not only spanks Reaganomics or the free market capitalism that got us into the worst recession since the Great Depression, he goes after “All the President’s [Obama's] Zombies.” LINK Excellent editorial and well worth the read.

“Reaganomics has failed to deliver what it promised, yet people still believe that government intervention is bad, and leaving the private sector to its own devices is good.”

Health Care

Even though there has been 11,000 health care events in 2500 towns and a huge 280,000 people Obama internet event (Thursday) occurred I don’t have the foggiest idea of the specifics behind the different competing plans for health care reform. Dozens of the “Town Halls” have been invaded by angry protesters and dominated the media attention. The waters are muddy and people are throwing more mud.

One point is clear – the skyrocketing costs , denied claims, & huge amount of uninsured are growing. The future is going to be one huge mega disaster – Costs up 100% in last 7 years and lots of folks age going to loose coverage because its going to go up a whole lot more in the next 7 years .  If health care costs you, your employer, or the government $13,000 for your family this year will we be able to afford $26,000 seven years from now?

The total cost for just my wife and I now run at @ $18,000+ a year not including dental. (Her employer, deductables, out of pocket expenses)

Republicans are going to do nothing. They’ve done nothing for decades.  However, this whole process is in need of leadership that can only come from the President. So far all that’s happened is the waters have been muddied and lots of people are throwing mud.

Financials – Driving Stocks Higher

This whole week is devoted to why US markets are moving higher – financial stocks or the shadow banks. The long term results may not be desirable economically, but in the short term this is the trend that is leading US equities and the world’s stock markets higher.

While the health care debate is almost the only focus of the media the fundamentals behind the financial trend higher  is becoming firmly established. There’s the good, the bad, and the ugly behind this, but now its just time to mark the fundamentals and change investment strategy to take advantage of the trend

  • We no longer have the transparency of mark to market accounting. Bad assets can and are being hidden.
  • The administration and the Fed have flooded financials with low interest loans
  • Almost nothing has been done to fix the too big to fail shadow banks

These banks are not be loaning out money at the rate they should. But when the big shadow banks do loan out money they are making killer profits.

Bottom Line for YOUR investments Investments in financials should continue to outperform despite other economic problems.

(more below and throughout the week)


STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow +1.67% up
NASDQ +1.59% up
S&P500 +1,86% up
Russell2000 +2.26% -

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals and Fundamentals

Both the NASDQ and the S&P 500 had gains in increased above average volume.   The volume was not earth shattering, but enough to confirm the gains.

The one fundamental that is the driving force behind the stocks surging is financials – Lets take a look at the price charts worst of the worst.

These are the companies (AIG, CitiGroup & Fannie Mae) that were among the leaders on the downside and the trend is clearly higher.  (See above editorial) The trend is your friend and let’s ride it.

——–

Significant forecasting tools/Indexes for stock markets

BDI The Baltic Dry Index measures the flow of goods by price (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern .  The BDI fell - 78 on Friday . We’ve again broken a support level and formed another lower low. Four days in a row down between 70 – & 90 points. The mid term trend since early July is clearly bearish, with a series of lower lows and lower highs. @ 2298 is a major area of support and the BDI has fallen since early June from 4291 to 2468.  This is just 170 points away from a major support level.

In a nut shell the BDI is

  • short term - Bearish pattern
  • mid term Bearish pattern
  • long term - Bullish pattern

Bottom Line This is NOT looking good . While we are still a long way off from major support levels but the mid term (since June) bearish trend is growing. T he case for trade barriers between nations and a growing worldwide recession is getting stronger.

While this index does not have as immediate impact on stocks, as the Dollar does, it is very significant to long term worldwide economics.

——-

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

The dollar fell -0.44% Friday and, you guessed it, stocks rallied. The Dollar is in a range between $79.5 and $77.5 . A breakout to either side will seriously impact stocks. Dollar closed at $78.04.  Its getting closer to its major support level of @$77.5

Mantra Dollar up = US stocks down & Dollar down = US stocks up

A gradual reduction in the price of the dollar is part of the solution to global worldwide recession

This is the index to watch because its impact is immediate.

Positions

The whole Positions Section has been revised (Click on “Positions” at top of blog). Check it out

Investors411 will become more involved in the financial sector. – ETF’s – XLF. UGY (2x financials) & FAS (3X financials) Investors411 will also be taking profits in some.  – Even though its not a dip lets start small and reopen the  position in financials.

Do not think we are too late to join this rally train, because the fundamentals (see editorial above) still support it.  There will be dips and Investors will buy those dips up to a 20% total position.

Because the Republicans, Democrats and especially the Obama administration are unwilling or too distracted by health care to go after shadow banks this trend will continue.

This move to add to financial sector is going to be a major change in investment strategy

Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

  • Share/Save/Bookmark
August 21, 2009

Market Update – Rodney Dangerfield

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , , ,

Rodney Dangerfield

The late comedian’s famous line was "I don’t get no respect." He’d bemoan his obviously earned lack of respect.  The same holds true for Obama. Doggie’s Mom points out in the comments section that under Obama we have had a financial recovery. Yet Obama gets no respect.  It all comes down to Health Care and leadership.

Where’s the Obama who stood tall when he ran for president? Where’s the passion that made us believe? Where’s the vision? Where’s the guy who withstood all Hillary, McCain and the far right threw at him? Where’s the Obama charisma?

Obama gave a milk toast talk yesterday stating "We’re going to have Heath Care Reform." He wasn’t exactly cardboard, but he was certainly no George Bush putting his arm around a 911 firefighter telling us its all going to be OK.

There’s a time to be cool, analytical, smart and a consensus builder, and there’s a time to stand and fight.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow +0.76% down
NASDQ +1.01% flat
S&P500 +1,09% up
Russell2000 +1.25% -

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals and Fundamentals

Yet another  weak below average volume rally. Therefore no confirmation of the price move either way. The major indexes are all approaching yearly highs. Hard to see any significant breakout because the volume is soooooooo weak.

Sometimes, the unexpected happens – Just about any technical analysts sees the above weak volume rally and in no way expects a rally. So if a rally happens all these technicians (and there are lots at major institution) are forced to cover. Consequently markets move higher.

The one fundamental that is the driving force behind the stocks surging is financials – From AIG to Citi, to B of A to GS and many others.  They are borrowing $ for nothing and getting very credit worthy clients to make loans to. They do not have to use mark to market accounting – so the books don’t reflect potential losses. Government is doing nothing to regulate them and the health care debate consumes all the news.

One should hope for some sort of regulations to return on those who caused the worldwide economic meltdown – but the too big to fail shadow banks are raking in the profits. This is the gravy train of wealth creation right now .

——–

The big number to focus on will be the August unemployment number in early September.

S ignificant forecasting tools/Indexes for stock markets

BDI The Baltic Dry Index measures the flow of goods by price (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern .  The BDI fell - 70 t he n -9 0 & -80 yesterday. We’ve again broken a support level and formed another lower low. The mid term trend since early July is clearly bearish, with a series of lower lows and lower highs. @ 2298 is a major area of support and the BDI has fallen since early June from 4291 to 2534

In a nut shell the BDI is

  • short term - Bearish pattern
  • mid term Bearish pattern
  • long term - Bullish pattern

Bottom Line This is NOT looking good . While we are still a long way off from major support levels but the mid term (since June) bearish trend is growing. T he case for trade barriers between nations and a growing worldwide recession is getting stronger.

While this index does not have as immediate impact on stocks, as the Dollar does, it is very significant to long term worldwide economics.


——-

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

The dollar fell -0.17% yesterday and, you guessed it, stocks rallied. The Dollar is in a range between $79.5 and $77.5 . A breakout to either side will seriously impact stocks. Dollar closed at $78.35

Mantra Dollar up = US stocks down & Dollar down = US stocks up

A gradual reduction in the price of the dollar is part of the solution to global worldwide recession

This is the index to watch because its impact is immediate.

Positions

The whole Positions Section has been revised (Click on "Positions" at top of blog). Check it out

Still have not had a chance to revise Positions section of blog.  Buying on dips – Smaller positions in FXI (China) & EWZ (Brazil) have been added to. Also an SPX (S&P 500) position has begun to be built on dips . Will update over weekend.

  • Considering selling the smaller amount of China stock recently added at a loss and a small amount of longer term position on China.
  • Going back into US financials as a longer term play on dips – If Dems & Obama are going to do nothing to regulate these massive (too big to fail) institutions and continue to throw cash at them – T hey will continue to make $$$$$. FLX , UYG (2X) financials & FAS (3X financials) are the ETF’s to use depending on you level of risk.
  • This is shaping up to be at least a 5 to 10% correction . Perhaps we’ll have to wait till September when volume should pick up for a bigger correction.

Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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August 20, 2009

Market Updates – Poverty

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , , , ,

Poverty Grows in 2008

Another 1.5 million people entered poverty in the world’s richest country last year. A total of 12.7% of the population. Obviously this number will increase in 2009. LINK The amount of poverty in this country keeps growing. Once we all hung together and the middle class grew. Perhaps the single largest cause of growing poverty is the lack of health care.

  • Now we have 14,000 losing health care every day
  • almost 50 million Americans are uninsured
  • the costs of those insured is going up at an annualized rate 8% every year
  • every 30 seconds an American declares bankruptcy because of heath care
  • an army of insurance agents looking for ways to deny coverage to those who have it.

Linking Physical Strength, Intimidation and Anger

Putin

photo – Kremlin/ Presidential Press Information Office

The headline tells it all and this research group uses Vladimir Putin (Russia’s most powerful man) as the prime example. The Miller-McCune group turns research into solution so both the story and its sponsor are of interest. LINK


STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow +0.66% up
NASDQ +0.68% up
S&P500 +0.69% up
Russell2000 +6.94% -

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals and Fundamentals

We recovered almost all of Monday’s losses, but in  weak below average volume . Volume was up just a wee bit. Therefore no confirmation of the price move either way

Significant forecasting tools/Indexes for stock markets

BDI The Baltic Dry Index measures the flow of goods (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern .  The BDI fell -70 points two days ago and -90 yesterday. We are about to form another lower low. The mid term trend since early July is clearly bearish, with a series of lower lows and lower highs.

In a nut shell the BDI is

  • short term - Bearish pattern
  • mid term Bearish pattern
  • long term - Bullish pattern

Bottom Line This is NOT looking good . While we are still a long way off from major support levels but the mid term (since June) bearish trend is growing. T he case for trade barriers between nations and a growing worldwide recession is getting stronger.

——-

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

The dollar fell -0.60% yesterday and, you guessed it, stocks rallied. The Dollar is in a range between $79.5 and $77.5 . A breakout to either side will seriously impact stocks. Dollar at $78.52

Mantra Dollar up = US stocks down & Dollar sown = US stocks up

A gradual reduction in the price of the dollar is part of the solution to global worldwide recession

This is the index to watch because its impact is immediate.

Positions

The whole Positions Section has been revised (Click on "Positions" at top of blog). Check it out

Still have not had a chance to revise Positions section of blog.  Buying on dips – Smaller positions in FXI (China) & EWZ (Brazil) have been added to. Also an SPX (S&P 500) position has begun to be built on dips .

  • Considering selling the smaller amount of China stock recently added at a loss and a small amount of longer term position on China.
  • Considering Going back into US financials  as a longer term play on dips – If Dems & Obama are going to do nothing to regulate these massive (too big to fail) institutions and continue to throw cash at them – They will continue to make $$$$$.
  • This is shaping up to be at least a 5 to 10% correction.

Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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August 19, 2009

Market Updates – Is Obama Tough Enough?

Author: Barr Jozwicki - Categories: Market Update


Is Obama Tough Enough?

Huffington Post Photo

That’s what many on the left are starting to ask, including MamaJama in the comments section of the blog.

  1. The Shadow Banks . The Democrats and Obama, even though they have a majority have done next to nothing to fix the problem that allowed “Financial Weapons of Mass Destruction” or Credit Default Swaps to flourish. They have bailed out he “too big to fail” shadow banks, but not instituted any significant safeguards.
  2. War and Government secrecy issues – There have been some minor changes, and progressive pablum, but Afghanistan has no long term plan and is looking more like Iraq (a pro Ahmadinejad Shia government in power and US troops still entrenched) or Vietnam
  3. Health Care – The recent “waffling” on the public part of Heath Care has many believing Obama doesn’t have the guts to stand up and fight. Economist Robert Reich brings up the same question.  LINK The NYT has a front page story on Democrats willing to go it alone LINK

The Big question is – Where is the Obama who stood tall during the election campaign and fought no matter where the polls had him? Perhaps this Health Care stuff is all a Muhammad Ali rope a dope strategy. Get a bill passed the Senate then fight. But the historic trend (above) shows a lack of leadership.

Thursday (2:30 EST) Obama is having a conference call to supporters. Will keep you updated.


STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow +0.90% down
NASDQ +1.30% down
S&P500 +1.01% down
Russell2000 +1.50% -

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals and Fundamentals

We recovered almost 1/2 of Monday’s losses, but in even weaker volume . Therefore no confirmation of the price move.

Last night Jim Cramer (The major financial channel’s popular host) announced with a flourish (his style) that the recent 3% dip was over. LINK Perhaps he’s right. But, volume did NOT confirm yesterday’s rally.  Going to stick by yesterday’s Fearless Forecast – This dip is going to be extended. Technically markets just got too overbought. Cramer’s WRONG.

THE MAJOR FACTORS HOLDING UP THE MARKETS (not Cramer’s)

  • China – Their stimulus package is working, but the BDI (see below) indicates that there may be long term trouble for exporting countries
  • Shadow Banks/Financials – Both the Fed and the administration is  giving them wheel barrels of money and doing nothing to solve the problems that got us into this mess.
  • US and other stimulus packages worldwide – Cutting taxes and helping to keep jobs is vital in a recession. The problem for the US is we were in such a debt hole to start with.
  • Gradual Falling Dollar – Helps recovery to a point , but also means higher oil prices. This is the key chart to watch right now . (see below)

Significant forecasting tools/Indexes for stock markets

BDI The Baltic Dry Index measures the flow of goods (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern .  The BDI fell -70 points yesterday.  The mid term trend since early July is clearly bearish, with a series of lower lows and lower highs.

In a nut shell the BDI is

  • short term - Bearish pattern
  • mid term Bearish pattern
  • long term - Bullish pattern

Bottom Line This is NOT looking good . While we are still a long way off from major support levels the mid term (since June) bearish trend is growing. This hurts most exporting countries like China. Are trade barrier growing internationally or is this just a long technical correction? – The case for trade barriers between nations and a growing worldwide recession is getting stronger.

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

The dollar fell -0.38% yesterday and, you guessed it, stocks rallied.

Mantra Dollar up = US stocks down & Dollar sown = US stocks up

A gradual reduction in the price of the dollar is part of the solution to global worldwide recession

This is the index to watch because its impact is immediate.

Positions

The whole Positions Section has been revised (Click on “Positions” at top of blog). Check it out

Still have not had a chance to revise Positions section of blog.  Buying on dips – Smaller positions in FXI (China) & EWZ (Brazil) have been added to. Also an SPX (S&P 500) position has begun to be built on dips .

The BDI is troubling, especially for our China investment. China is becoming more self sufficient daily and has a strong net surplus, but if trade numbers continue to fall they will get impacted.

  • Considering selling the smaller amount of China stock recently added at a loss and a small amount of longer term position on China.
  • Considering going back into US financials  as a longer term play on dips – If Dems & Obama are going to do nothing to regulate these massive (too big to fail) institutions and continue to throw cash at them – They will continue to make $$$$$.
  • This is shaping up to be at least a 5 to 10% correction.

Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

  • Share/Save/Bookmark
August 18, 2009

Market Updates – Right Wing Takes a Hit

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , , , , , ,

Health Care

Obama

photo – Huffington Post

Last Friday’s blog outlined the probable course of health care legislation. Basically the House would come up with a private plan, the Senate something different. Then it all goes to conference. If Obama and Democratic leadership wants, it can force a majority rules vote.  That’s when the real FIREWORKS happens.

Last week (sugar dependent) John, suggested a program in the comments section that deserves more thought - Provide everyone with a basic program, like medicare , and let richer folks add onto this. The devil is in the details , but this works with education, and law enforcement – why not health care .

Right Wing Radio Takes a Hit

Tvbeckobama

Glen Beck The Fox News host who has called Obama a "racist" has lost more than a handful of major advertisers. LINK You can join and fight those who believe that screaming the loudest and name calling is what America is all about. Specifically in the Glen Beck fight one effective organization is TheColorofChange.orgLINK

Another older organization is MediaMatters.orgLINK

If you sit and do nothing, the Mob, the Screamers and the Haters win.

If you stay silent the fear mongering will grow.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow -2.00% flat
NASDQ -2.75% flat
S&P500 -2.43% flat
Russell2000 -2.79% -

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals and Fundamentals

A significant meltdown in WEAK below average volume. Volume, the #1 confirmation factor did NOT confirm the move lower.  If volume does not confirm the price move you look at what happens the next day. General rule if over 1/2 losses are recovered – that’s bullish & if market continues to fall, that’s bearis h .

US and most world markets were way oversold and long overdue for a retreat.

Significant forecasting tools/Indexes for stock markets

BDI The Baltic Dry Index measures the flow of goods (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern .  The BDI three day bullish trend is flattening. Up only +22 points yesterday.  The mid term trend since early July is clearly bearish, with a series of lower lows and lower highs. Bulls need a good long run here to break out of the bearish trading pattern.

In a nut shell the BDI is

  • short term - Short bullish trend turning
  • mid term Bearish pattern
  • long term - Bullish pattern

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.  What has become quite clear is that the dollars 50 day moving average has become and ultra strong resistance level . This is signified by the blue line on chart . Every time prices close to this descending line since the end of June they have failed to break out higher.

Once again we tested that 50 day moving average yesterdayand failed to break out. The dollar moved up +0.62% yesterday and therefore, stocks moved down. Long term the dollar is in a bearish trend , but the short term trend is at a bullish breakout level. Mantra Dollar up = US stocks down

A gradual reduction in the price of the dollar is part of the solution to global worldwide recession

This is the index to watch. If the dollar moves higher, then stocks will get toasted.

Fearless Forecast

  • World trade numbers (BDI) continue to be locked in a mid term bearish trend. Trade could be breaking down between countries and protectionism rising or the BDI just went up too far too fast.
  • The USA is printing and stimulating its economy with wheel barrels of cash. The dollar should be falling and therefore, stocks rising.
  • US equities reached way oversold levels and technically needed a breather.
  • There are fundamental signs of bottom line growth abroad (China mostly and some other countries and a few US companies)
  • Big drop in small volume for US stocks on Monday = no confirmation of downside move.

Its very important to look at things globally instead of just egocentrically focusing on US equities. Everybody is oversold and a low volume retreat (yesterday) is not a conformation of the downside move. In bull markets a 5 to 10% fall is a buying oppertunity.

For the week - look for a rebound early and then things to level off or even fall lower .

A retreat of 5+% would even be technically good for the markets. Worldwide, we need to cool off a bit. The dollar is the index to watch in the short term and the BDI long term.  Fundamentally its hard to see the  dollar move higher so longer term still see raly intact.  Of course, this could change if dollar rises.

CAUTIOUSLY BULLISH is still the long term call and dips are buying opportunity.

Positions

The whole Positions Section has been revised (Click on "Positions" at top of blog). Check it out

Still have not had a chance to revise Positions section of blog.  Buy on dips smaller positions in FXI (China) & EWZ (Brazil) have been added to. Also an SPX (S&P 500) position has been built on dips.

Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

  • Share/Save/Bookmark
August 17, 2009

MarketUpdate – Eleavator Ride

Author: Barr Jozwicki - Categories: Market Update - Tags: , , ,

The Blooper Heard Round The World

Heath Care Fear Mongering – This time they may have gone too far. Investor’s Business Daily (IBD) based a scathing editorial against public heath care on this generation’s Einstein, Steven Hawking (photo above). The claimed Hawking “Wouldn’t have a chance” in the British National Health Service (public) because they would consider his life “worthless.Only problem was Hawking is British LINK

Elevator Gets Stuck

or

Dog Ate My Homework

Late last night after seeing a movie (District 9) at an AMC thearter connected to a Ritz Hotel we, along with 13 other people got stuck between floors in an elevator. A small exit sign at the back of the theater led us down a narrow hall to an elevator. The only other exit was through another theater already in progress.

  • 3500 lbs was the capacity for the elevator – we 15 were well under that weight
  • There were no exit signs in hallway
  • The inspection permit for elevator had expired

How to get out of a stuck elevator which had thudded to a halt and was dangerously listing to one side . First someone had a good ide of unscrewing some of the lights on top. It was getting hot. Yes we rang the alarm bell and the fire department later arrived.

  • Pull the elevator door open like you would a sliding glass door
  • Next find the latch to the inside door and open the lever.
  • Climb out to the next floor

Investors411 will return with a full report tomorrow - Just no time this AM -just a Fearless Forecast.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Fearless Forecast

Last weeks forecast was on the mark. Market closed lower Friday and were down for the week. Sorry have not looked at relevent data and will do a forecast tomorrow.

However, as long as the shadow banks are allowed to opperate in the shadows and the Fed & Obama administration throw money (low or zero  interest loans) at them there is little danger of a short term meltdown. Of course keeping the same system of unregulated so called “free markets” financials in place will enevatably bring on another even larger disaster.

Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

  • Share/Save/Bookmark
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