Investors 411 Blog

Mad Hatter/Johnney Depp frm Alice

Will Technology Save Us?

Using fancy complex technology to do shadow bank financing certainly facilitated a global financial meltdown.  However, having now seen Tim Burton (a gifted director) Alice In Wonderland in IMAX 3d I’ve fallen through the looking glass over advancements in 3 D technology again.  Two new films “Dragons” (saw previews to this and would consider flying to Fargo ND to take my grandkids to this film) and “Titans” are fighting it out with Alice for the limited number of 3D screens. There are 24 more 3D movies on the way this year.

Health Care’s Last, Last Stand

Like in the Terminator movies Arnold just kept coming and coming after you. Sometimes he was the good guy sometimes the bad.  Well, yesterday ultra lefty congressman Dennis Kucinich flip flopped and now may be Obama’s  St Patrick day’s luck charm on health care. For more see Health Cares Last Stand (scroll down)

Damage Control

The Catholic Church brings many people closer to God and has fought for many social justice issues.  However, this whole business about pedophile priests has been a nightmare that they have made worse because they just have little concept of how to do damage control.  Sure these events are horrific but stop trying to cover it up or whitewash everything. More here & here & here Then again basically ignoring is a form of damage control.

Off With Their Heads

Ted Kaufman is now by far the strongest Senator is calling for reform on Wall Street. Bravo. WSJ article & MIT’s Simon Johnson‘s  “Fraud Still at the Heart of Wall Street.” on Kaufman. Perhaps we should do what they did to the head of North Korea’s financial chief -  When he messed up - He got executed.

Baseball = Evil, Football = Good

The reality is sometimes more socialist systems do work better than capitalist systems in generating revenue. Hard to argue in the USA institutionally baseball is in decline while football is rising. Big market teams win, get fans and revenue. Small makets almost always loose, fands leave and so does revenue.  In football they have a strict team salary cap and strict progressive draft system. Their stadiums are almost all full, their championships and media rating are skyrocketing.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

Volume was moderate and up a wee bit, as stocks advanced yesterday. Volume is half heartedly confirming a much less than stellar two day rally. This short rally was built on a two week low volume rally. Technically as we again approach oversold levels, volume, the #1 confirmation factor of a price move, is giving us a slightly bullish signal

Since the Oscillator Investors uses is not yet overbought we have some wiggle room for stocks to move higher in the short term.

Technicaly, this its like there is a whole group of soldiers assaulting a barricade (pushing out to even higher highs). These soldiers seem to be moving very slowly for a charge, but progress is progress.  Once we hit oversold territory progress should slow even further.

Fundamentally “stocks could pick up steam today because of weekly jobless claims (better than expected) and “quadruple witching” (don’t worry if you do not know what quadruple witching is but it is fascinating to see all those traders flying around the NY stock exchange on their broom sticks)

Significant Indexes

• McClellan Oscillator rose to +51.86 yesterday. We still under, but getting close to +60 or Overbought territory. The recent high two weeks ago was 75.33 StockCharts has a better version of the McClellan chart ($NYMO) LINK.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

From yesterday – “I’m going to try to play TYH again on a small dip (if it happens) and sell it when markets get oversold. Again I’ll have a tight 3% stop.  The mistake was not to invest in a stock or ETF yesterday after it became obvious that US markets were reacting positively to what the Fed said at 2:15 EST.” Missed out when TYH dipped in the AM because I was doing taxes – bummer. The window is closing on this short term play the closer we get to oversold. Would have to see a 1 to 2 % drop in TYH to consider entering trade again today.

Going to build up to a 20% position in stocks involved with 3D technology. They can’t build 3D theaters fast enough to keep up with the demand. 3D TVs started being sold last month and a 3D channel is supposed to begin within a year.  See Tuesday’s Investors411 for more. (use calender on top of blog and click on Tuesday 5/16 then scroll down)

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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Yankee Bob on Evil

Yankee Bob’s latest comments (yesterday) are today’s feature editorial.  Lots of you make really thought provoking and outside the box comments and you should always check out who is saying what about stocks, (see PaulR’s recent comments) economics and politics. Bob’s comments seem to flow from a statement by another blogger D. “I’m so sick of those who are blinded by their emotions and stereotype one side as all evil and the other as all good.”

There is a difference between personal behavior and institutional behavior. The individual s who brought us the financial disaster and needed bailing out are not necessarily evil. They just operate within an economic section that itself is dysfunctional.

The individuals play by the socially accepted standards of their small group in the financial world. It’s the standards of the group, the sector, the institutions of finance, must be changed before we see a change in the individual corporate officers. The institutions have been rigged to select those junkyard dogs who are able to game the system for the biggest gains,no matter how risky or dysfunctional for society. Then when they are successful at it,the junkyard dog expects his just due,..huge bonuses and is perplexed when the victimized taxpayers don’t like him because he did as his sector, his small group expected him to do and he was damned good at it.

That social sector, financial executives, looks at the public as sheep to be shorn, not helped. These people are not evil . They operate in a world that has different expectations then the public. The group dynamic has to be changed,…not the individuals.

See part 2 in the comments section of blog

* What Yankee Bob says holds for everything except the beloved saintly Boston Red Sox and the forces of Darth Vader & the evil empire the New York Yankees

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

Volume was moderately higher as stocks advance yesterday. The Fed decision to basically leave the change in interest language alone was well received by investors and sparked the rally. How markets react to news is often a future indicator of short term market direction.  Since the Oscillator Investors uses is not yet overbought we have some wiggle room for stocks to move higher in the short term. See read of tea leaves below.

Significant Indexes

• McClellan Oscillator rose to +44.11 yesterday. We still under +60 or Overbought territory and the recent high of over 75.  StockCharts has a better version of the McClellan chart ($NYMO) LINK. Two weeks ago week the NYMO reached a high of 75.33.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Short term traders – To be a short term trader you have to realize just how much more the vast majority of investors/institutions know about the stock/ETF  you’re investing in than you. What you can do, because these sharks invest so much money, is follow their footprints.  What Investors411 hopes to do is educate on how to follow those footprints and see the direction they are headed. You have to realize the significant risk and potential leverage problem in holding high beta (volatile ETF’s and stocks) short term positions overnight. You have to have a better understanding of fundamentals behind any positions or ETF’s mentioned in Investors411. You also have to have an exit the position plan in advance.

Best Read of the Tea Leaves = The rally predicted for this week was reinforced by the Fed decision not to change language about leaving interest rates alone. I’m going to try to play TYH again on a small dip (if it happens) and sell it when markets get oversold. Again I’ll have a tight 3% stop.  The mistake was not to invest in a stock or ETF yesterday after it became obvious that US markets were reacting positively to what the Fed said at 2:15 EST.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Is the Volker Rule Dead?

Sorry all my time was spent putting an analysis of YOUR stocks together. Many of these stocks have gone up over +20% in the last few weeks. Congradulations! Here’s and interesting editorial on above topic.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

Flat day in weak volume again. US markets are consolidating.  Consolidating (trading in a tight flat range) is good and usually good for bulls and generally means the trend will continue. The monkey wrench here is that there was little increased volume behind the move higher.

Fearless Forecast for Week – Because we now are not oversold (see below) and the earlier move higher had such momentum behind it look for a rally or up week. (Sorry spent time answering questions and did not do the usual Monday forecast)

Last week’s fearless forecast “momentum should make this an up, but volatile week.” Not so volatile, but certainly an up week.

Significant Indexes

• McClellan Oscillator fell a again to +30.02 yesterday. We now well under +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK. Two weeks ago week the NYMO reached a high of 75.33.
• BDI - The Baltic Dry Index, which measures the cost of world trade (also a good indicator of how China is doing since they are huge exporters/importers) has exploded higher in late Feb. & early March. After flattening for a few days last week it is still moving higher = Bulls rule
• USD – The Dollar regained almost all of what it lost on Friday.  In the past there has been a strong correlation between a falling dollar and a rising US stock market. Right now the dollar is back within its consolidation pattern = Neutral for stocks
  

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

From Friday “Shorter term traders – ” Bought a 10% (Of portfolio) position in TYH at 151.50. Put stop at that 151.5 and may sell 1/2 for 3 to 5% gain hopefully today. TYH closed at 154.99 – Sold 1/2 TYH at 156,oo for +3% gain Friday AM and got stopped out yesterday at151.5 for a 0% gain

YOUR Stock List

The McClellan Oscillator has fallen from Oversold (over +60) to near neutral territory +30. In past Updates I mentioned I’d nibble on some of these stocks as the NYMO came close to +20. The best time to buy are when conditions are oversold or at/below -60. It all depends on Your individual level of risk as to when you buy. The lower the NYMO goes the less the risk. So for those who can tolerate lots of risk you could nibble a little

NB -Last Week’s comments in black. This week’s violet. Chart links underlined in Blue

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

• CAAS – Ever since this stock was put on list it has gone up big time. A buy the dip stock Volume dropping as stock consolidates = bullish A buy the dip stock
• PCLN – Dipped last week and now in rally mode A buy the dip stock Volume dropping as stock consolidates = bullish A buy the dip stock
• F – Too over extended or above 50 day Moving Average. Still going up, but too overextended – wait
  
• IMAX Investors411 owns this stock – Went elliptically higher and now must find base. wait
• CSCO, Like AAPL at new high this year. For longer term investor. A buy the dip stock. exploded higher, now consolidating A buy the dip stock
  
• SHOO – traded flat after breakout – in consolidation A buy the dip stock failed breakout but still has potential
  
• ICON, Broke out and is on run higher. Too over extended now.Volume dropping as stock consolidates = bullish A buy the dip stock
• VPRT Did break out. A little overextended. A buy the dip stock Fallen in heavy volume = bearish – Wait
  
• DGIT Thinly traded  Consolidating, A buy the dip stock Still consolidating in weak volume = bullish A buy the dip stock
• CTCT Thinly traded but Good volume and another breakout A buy the dip stock Exploded higher too overextened wait
  
• VCI Another breakout, over extended Tempting, but risky starting to consolidate Still Tempting, but risky
• CREE -  Starting to Dip A buy the dip stock. dipping in weak volume = bullish, a buy the dip stock
  
• SNDK – .  Dipped then moved higher. Too over extended dipping in weak volume = bullish, a buy the dip stock
• VSH – .  Consolidating and now looking better, a little over extended Tempting dipped/fell in moderate volume. Tempting
  
• HMIN – Falling Too much downside volume

New

• RINO - Brokeout yesterday in heavy volume = bullish – a buy the dip stock
• CTRP – Faces a resistance level & just dipped in weak volume a buy the dip stock
• CNAM Went elliptical now finding base. Huge risk but huge reward Wait

New plays that have similar 3d fundamentals as IMAX.

• DWA (Dreamworks) Lots of upcoming kids 3d movies. Consolidating but some big down volume days - wait
• CNK (Cinemark) Theater chain building 3d theaters. Still a bit over extended – Tempting
• RGC (Regal Entertainment) just broke out again. Too overextended wait for dip.- Tempting
  

Bottom Line – there are a whole mess of decent stocks to choose from. We are no longer in oversold territory so less risk averse folks may want to nibble. The more oversold the general markets get the better all of these stocks look. My top picks are anything that says = bullish a buy the dip stock. Caution here is I’m only looking at these stocks technically. I would hope you do some fundamental research before buying.

There are two reasons many of your choices went up.

1. You choose wisely.
2. We went from below -60 (oversold on the McClellan Oscillator) to over + 60. (overbought.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Head of Lehman Brothers Dick Fuld

Friends and Enemies?

What countries do your fellow citizens look at favorably and unfavorably? Gallop Poll has some fascinating results with Canada on top and Iran on the bottom. In black and white, over the top terms – who are out top 3 friends and top 3 enemies? Interesting - 90% is the largest rating up or down.

D’s blog comment

As always check out the comments on right hand side of blog by Popeye, PaulR, D, & Doggie’s Mom on Israel and stocks. One comment is something I think or hope we all share by D -

I’m so sick of those who are blinded by their emotions and stereotype one side as all evil and the other as all good.

Seeking Alpha

Three of you last week sent me editorials/articles from this financial site.  THANKS Reality is money makes the world go around – or at least influences everything from politics to religion. One particular man to follow is Jeff Nielson – read The Plutarch nation about the huge and growing division between rich and poor in the USA – How great the tax cuts are for t he wealthy and how small they are for the Middle class.

Lehman Brothers

Turns out that Lehman Brothers was lying about how much money they had and their accountants (Ernst and Young) backed them up according to a 2200 page report. Lehman’s collapse set off the 2008 meltdown. Seeking Alpha currently has 3 stories on this, but this  Dylan Ratigan video best explains how “the crooks” scammed the world through “repo transaction ” One of the Greatest crimes in history.”

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

Flat day in weak volume. Volume has NOT confirmed the move higher over the last few weeks. Cutting this section short to answer YOUR QUESTIONS

• What exactly is going elliptical? I really wish there were a clear set of exact rules to follow. Basically, its when a stocks moves too high too fast in big volume – it runs out of buyers and collapses because there is no one left to buy. This can also happen with sellers and going down too fast. This can happen interday (for day traders to use), but most of you are longer term traders than that.  Look at the charts of 3 stocks that have just gone elliptical. IMAX, C & CNAM (the later went elliptical @ a week ago. Common characteristic three or four days of a 20+% move higher in HUGE volume. Usually the bigger the climb & volume the worse the drop afterward. First off going elliptical is almost always a time to sell.  The harder question is when to jump back in. (tomorrow)
• Are TYH and other ETF’s that do 2 and 3 times what a market basket of stock do dangerous to hold overnight? See PaulR’s always astute market comments on the right side of blog. Short answer is YES. If you look at the “candlestick” chart of TYH over the last 6 months you will find several times is opened @3+%lower and one time in late November it opened @5% lower. This puts it in the same category  as “high beta” (hot stocks) stocks like Citigroup. Citi’s chart shows a  few more days it fell over 3+% and one time in December plunged @7% overnight. There is a big risk in both.
• Solution – First learn more about the technical aspect of investing. Second you can mitigate the risk by buying less.  Say you think technology is going to go up so you buy QQQQ (basically a tech ETF that mirrors tech.) THY does roughly 3X what QQQQ does. Therefore, Invest 1/3 the money in TYH that you would have in the QQQQ. It’s then almost the exact same risk in total money and you have 2/3 of your capital earning interest or for another investment. This is called leverage. And as many of you know there are a zillion other ways to mitigate risk through leverage. Some good (like this if you don’t go & over leverage your whole portfolio) and some that can get you and the world in a whole lot of trouble.

Significant Indexes

• McClellan Oscillator fell a again to +51.09 yesterday. We are still under +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK. Two weeks ago week the NYMO reached a high of 75.33. Interesting fact here NYMO is falling as stocks slowly melt up.  This is probably due to the fact that this Oscillator takes into account volume that is declining.
• BDI - The Baltic Dry Index, which measures the cost of world trade (also a good indicator of how China is doing since they are huge exporters/importers) has exploded higher in the last few weeks. After flattening for a few days it is again starting to explode higher = Bulls rule
• USD – The Dollar 0 Friday the dollar -0.58% and broke through a support level.  In the past there has been a strong correlation between a falling dollar and a rising US stock market. = Bullish sign
  

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Over the last few days several of you have sent emails with many interesting new stocks RINO, CTRP & explosive CNAM are three I’ll add to tomorrow’s watch list.

From Friday “Shorter term traders – ” Bought a 10% (Of portfolio) position in TYH at 151.50. Put stop at that 151.5 and may sell 1/2 for 3 to 5% gain hopefully today. TYH closed at 154.99 – Sold 1/2 TYH at 156,oo for +3% gain Friday AM

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

The Empire Forever-Photo from Atlantic

Israel’s Knife in Biden’s Back

VP Joe Biden, who many consider the greatest friend of Israel ever had  in the US Senate, has spent about a week in Israel.  He opened with gushing words of support for Israel. The next day Israel announced 1600 new homes in what Palestinians believe is their land. The far right Israeli government put a knife in the American backed peace process and basically said F— Y– to Obama. Laura Rosen from Politico on reaction

Janet Yellin for Fed Vice Chair

The Fed has an enormous influence over YOUR life. Janet Yellin has been leaked as Obama’s choice.  Almost all extremely well qualified choices like Yelin are quickly approved. But times have changed and politics rule. Experience, Intellectual rigor, have become secondary to political views.

Insults in Afghanistan

Iran’s Ahmadinejad (Add 911 was a CIA conspiracy, plus the old holocaust didn’t happen to his list of pronouncements) and Sec. of Defense Gates traded insults while both were in Afghanistan. Both visited so called “President” Karzai. Story link from foreign press.

A BRIC Wall

BRIC = the emerging market giants Brazil, Russia, India and China who many seem to think are taking an opposing view to US policy – On the front burner, see National Interest piece, on blockingsanctions for Iran

Public Option’s Last Try

Bernie Sanders will introduce the public option sooner rather than later

Empire Forever

Robert Kaplan has an outstanding piece in the Atlantic on Afghanistan & the American Empire.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

Almost the exact same as yesterday-” Another melt up day in decreased volume.” This is now a mantra. Volume is NOT confirming the move higher.

Again same as yesterday – “As suggested yesterday the XLF (ETF for financial stocks) was one of several possible catalysts for continuing the rally. As the chart shows, its broken out to new highs over the last two days in increased volume. Basically, any meaningful attempt to shadow institutions and bring transparency to related markets is getting crushed. Therefore, it sure looks like the shadow financials  will add fuel to the stock rally.” This move higher is being led by Citigroup which move up &% yesterday and traded an overwhelming billion+ shares again.  This stock, like IMAX,  is going elliptical and expect it to run out of juice today.

The benchmark S&P 500 closed directly on its 18 month high. Obviously, momentum is with the bulls.

3 positions are open on the Fed and Janet Yellen has been leaked as the choice.

Retail numbers [just came in much better than expected = rally ho] and consumer confidence this AM – Both significant fundamentals that can move the market.

As long as mild melt ups continue outlook remains bullish.

Significant Indexes

• McClellan Oscillator fell a bit to +60.06 yesterday. We are still well above +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK. Last week the NYMO reached a high of 75.33. It looks like we could get above that. So there is room for a short term trade, but longer term overbought = sell
• BDI - The Baltic Dry Index, which measures the cost of world trade (also a good indicator of how China is doing since they are huge exporters/importers) has exploded higher in the last few weeks. After flattening for a few days it is once again moving higher = Bulls rule

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

From Yesterday “ IMAX – has exploded higher in HUGE volume.  It has “gaped” higher three days in a row.  In short, its going elliptical. That means expect a pull back. IMAX also reports earnings today.” IMAX “gapped” higher at the open again and was up over 7% and ended the day down 1.00% in HUGE  volume.  Best read of tea leaves is IMAX will take another day or two to settle then consolidate of move up. 

Mistake was to not sell some IMAX when stock “gapped” higher.(Up 7%)

From yesterday “Shorter term traders – Even though we are overbought, it sure looks like the McClellan will reach above 80 sooner rather than later. You might want to go long with TYH(3X technology) or FAS (3X what financials do) Buy a dip and keep tight stops.” Bought a 10% (Of portfolio) position in TYH at 151.50. Put stop at that 151.5 and may sell 1/2 for 3 to 5% gain hopefully today. TYH closed at 154.99

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Senator Ted Kaufman (D DE)

Financial Reform

Sadly, financial reform of greed based capitalism, shadow banks, and greater market transparency continues to deteriorate. At times it seems  as if  the 2008 meltdown never happened

Steve Forbes, this AM on CNBC proudly announced the list of the world’s richest billionaires has significantly grown in size and money, as real unemployment is the USA has fallen to near 20% (The billionaire, obviously, did not offer the last 1/2 of this comparison) Forbes, of course, does not want “big” government to regulate greed based capitalism. Outside of a few voices within the Obama administration (Paul Volker, Elizabeth Warren etc.) both the administration and the lobbyist that dominate congress seem to agree – Let business take all the risks it wants and us taxpayers plus our kids will pay trillions to fix all their mistakes

Senator Ted Kaufman (D-DE) is one of the people who is not afraid to stand up for rules based capitalism. On his website is the speech he plans to deliver today.

One legacy of the Great Depression was we built a rules based capitalist system that endured and dominated the world until a few decade ago. Here’s a summary of his ideas from The Baseline Senerio

• Excessive deregulation allowed big finance to get out of control from the 1980s – but particularly during and after the 1990s.  This led directly to the economic catastrophe in 2007-08.

• We need to modernize and apply the same general principles that were behind the Glass-Steagall, i.e., separating “boring” but essential commercial banking (running payments, offering deposits-with-insurance, etc) from “risky” other forms of financial activity

• We need size caps on the biggest banks in our financial system, preferably as a percent of GDP.

• We should tighten capital requirements substantially.

• And we must regulate derivatives more tightly – on this issue, he likes at least some of the steps being pushed by Gary Gensler at the CFTC.

The stock market will rise because Senator Kaufman’s speech is NOT impending legislation. But unless we do something we will continue to repeat the mistakes of the past and every taxpayer and their child will continue to pay an enormous price - “socializing the risk and privatizing the gain”

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

Another melt up day in decreased volume. Right now it seems, even though US markets are overbought, they are poised to move higher on any piece of good news.

As suggested yesterday the XLF (ETF for financial stocks) was one of several possible catalysts for continuing the rally. As the chart shows, its broken out to new highs over the last two days in increased volume.  Basically, any meaningful attempt to shadow institutions and bring transparency to related markets is getting crushed. Therefore, it sure looks like the shadow financials  will add fuel to the stock rally

Shorter term traders - Even though we are overbought, it sure looks like the McClellan will reach above 80 sooner rather than later. You might want to go long with TYH(3X technology) or FAS (3X what financials do) Buy a dip and keep tight stops.

Significant Indexes

• McClellan Oscillator rose a bit to +64.63 yesterday. We are still well above +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK.
• BDI - The Baltic Dry Index, which measures the cost of world trade (also a good indicator of how China is doing since they are huge exporters/importers) has exploded higher in the last few weeks = Bulls rule BDI has flattened out in the last tree days

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

IMAX – has exploded higher in HUGE volume.  It has “gaped” higher three days in a row.  In short, its going elliptical. That means expect a pull back. IMAX also reports earnings today.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Dylan Ratigan

No Brainer TAX

Senators Jim Webb (D) and Barbara Boxer (D) are offering a NO BRAINER tax that many other countries have already enacted.

If your company took over $5 billion of the TARP funds (our tax money) all bonuses over $400,000 would be subject to a 50% tax for the years you held our TARP money. The only reason these companies exist is because of  the TARP bailout, borrowing trillions at @ 0.00% from the FED (means future inflation for you) and have been allowed to drop transparent mark to market accounting.

You’d think a 50% tax on just the bonuses over $400,000 for the top executive would fly through congress like far more stringent taxes have in other countries like Britain. But YOU hear almost nothing about it because of the lobbyists and their tight control over the media. Dylan Ratigan on MSNBC (4:00PM EST) yesterday carried an interview with Senator Webb (D-VA) It seems in their first attempt they could not even get this on the floor of the Senate for a vote.

YOU get the bill and the wealthy that screwed you get the Bonus – Only in America and third world dictatorships does this happen.

Health Care

The Good, The Bad and the Ugly

• The Good-The proposed Heath car plan under Obama will cover an additional 31 million Americans. Perhaps we will no longer be #1 on the list of “western” countries in which preventable deaths occur. One Republican’s  plan covers 3 million additional Americans. Its better than zero.
• The Bad – At best long term, the Obama plan may very very slightly limits the 17+% and growing amount of GDP we spend on health care. Obama administration long ago sold out to the monopoly the insurance & drug companies have in the USA.
• The Ugly -  Totally political congress that is only interested in getting elected instead of solutions  and lack of leadership from Obama have prevented real solutions that are working – a public option or universal health care that dozens of other countries have voted to keep for decades.

Yes, we have the best health care system in the world - If youyou’rer a Saudi Prince, uber wealthy foreigner, know someone, or are a wealthy American you actually get to use the best system in the world. Forget it if you’re an average Joe and Jane American.

Whipcongress.com has  kept the drive for a public option alive – 40 Senators have signed on – YOU can help.

Dylan Ratigan

Dylan, used to be the anchor and co creator of CNBC’s “Fast Money” and now has his own show on MSNBC.  He has both financial skills and is unafraid to nail any politician or industry unlike the corporate lapdogs of CNBC. As stated above his show is on at 4:00 PM EST.  One of his recent editorials on Corporate Communism in Heath Care and Banking. is a Must Read.

As Americans, I believe we reject communism because it historically has allowed a tiny group of people to consolidate complete control over national resources (including people), in the process stifling competition, freedom and choice. It leaves its citizens stagnating under the perpetual broken systems with no natural motivation to innovate, improve services or reduce costs.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

A decent rally collapsed into yesterday’s close. We rallied a bit in the last 10 minutes to close in the green. Volume was up & above average. The benchmark S&P 500 came within @ 0.40% of reaching anew 18 month high. The NASDQ and Russell 2000 are already at new highs, but it has NOT been the typical big volume breakout that usually signifies the continuation of a major rally.

US markets need some fundamental push to breakout before the bullish momentum runs out of steam.

• Perhaps good news from weekly jobless claims Thursday.
• Perhaps the increased exports/imports just announced by China will lead markets higher, China is not nearly as close to or at  a new highs like US, Britain and some other countries. Worries over a developing housing/office space glut/bubble are holding back investors.
• Perhaps it will be the financial sector (XLF the ETF) that almost broke out yesterday. – Attempts to regulate this sector are getting weaker.
• Perhaps the Dollar will fall. This would mean the Euro would get stronger.

Significant Indexes

• McClellan Oscillator dropped a bit to +6o.89 yesterday. We are still well above +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK.
• BDI - The Baltic Dry Index, which measures the cost of world trade (also a good indicator of how China is doing since they are huge exporters/importers) has exploded higher in the last few weeks = Bulls rule Two days ago the BDI, like stocks, leveled off in front of a strong resistance level. Yesterday it fell.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Mantra – Since the McClellan Oscillator (NYMO) is still over +60, or overbought -  Right now,  selling (taking profits) is more desirable than opening new positions because of the short term over bought conditions. Positions:

• 6% EWZ (Brazil)
  
• 5%MOO (agriculture ETF)
• 5%FXI (China)
  
• 3% IMAX – In a HUGE explosion higher right now

All three ETF positions are currently under performing US markets.  They are 5 to 10% from their old highs. Will sell more if NYMO gets above +80. Will nibble on THY & other positions if NYMO falls to @+20

Answer to Monitor’s comment - Congratulations on using  YOUR Stock Picks wisely and making a killing, I know others who have used the list and sent personal emails are also doing well.  See comments section on side of blog.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Bob Herbert- NYT

Jobs, Jobs Jobs

Agree with NYT’s Bob Herbert, “Obama’s Source of Trouble” is Jobs. The Obama administration from the start has underestimated the depth of this recession and its underlying causes. The end result – JOB LOSS in the USA.

Unfortunately, research on YOUR stock picks takes time, and I’ve run out.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

Lightest trading day of the year.  Markets went no where.  Basically, this is a slight positive for bulls, because it means Friday’s rally held.

CSCO has some big announcement today – 11:00AM EST – Usually stocks run up before major announcements and investors sell the news.

NASDQ reached a new yearly high in weak volume. Think the benchmark S &P 500 has at least one more push to a new high this week or next. Then it should pull back. Longer term Outlook Cautiously Bullish.

Significant Indexes

• McClellan Oscillator dropped a bit to +68.29 yesterday. We are still well above +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK.

• BDI – The Baltic Dry Index, which measures the cost of world trade (also a good indicator of how China is doing since they are huge exporters/importers) has exploded higher in the last few weeks = Bulls rule Yesterday the BDI, like stocks leveled off in front of a strong resistance level.
• USD – The US Dollar has been range bound for about a month after moving significantly higher. Early Dec the dollar bottomed at $74+ and is now at $80+. There are some pluses and minuses to the strengthening dollar. For US stocks the fact that they and the dollar are near highs together is Bullish

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Since the McClellan Oscillator over +60, or overbought – buying right now is far more dangerous than when markets are oversold. I’m waiting till we get around +20 just to  nibble some more on some of  these stocks. Most stocks move with the overall markets. YOUR decision on when to trade is also based on how long you are going to hold the stock and YOUR level of risk.

If you are considering individual stocks I strongly urge you look at the charts and learn something about technical analysis.

NB -Last Week’s comments in black. This week’s violet. Charts underlined in Blue

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

• CAAS – volume confirming rally – A buy the dip stock. Ever since this stock was put on list it has gone up big time. A buy the dip stock
  
• PCLN – Breakout 5.22% move yesterday in good volume – A buy the dip stock Dipped last week and now in rally mode A buy the dip stock
• F – Breakout 5.71% yesterday in good volume – A buy the dip stock. Too over extended or above 50 day Moving Average.
  
• IMAX Investors411 owns this stock – Broke out to new high. Up +8.16 yesterday. A buy the dip stock
• CSCO, Slower steadier more for longer term investor. Like AAPL at new high this year. For longer term investor. A buy the dip stock
• SHOO, A 4.02% breakout in good volume yesterday – A buy the dip stock – traded flat after breakout – in consolidation A buy the dip stock
• ICON, Has formed a series of higher lows & higher highs – A buy the dip stock Broke out and is on run higher. Too over extended now.
  
• VPRT Up +2.49% yesterday in what could be a breakout – A buy the dip stock – Did break out. A little overextended. A buy the dip stock
• DGIT Thinly traded A buy the dip Consolidating A buy the dip stock
  
• CTCT Building on higher highs and higher lows – Buy the dip Thinly traded but Good volume and another breakout A buy the dip stock
  
• VCI Dipped and has made up most of that loss, but in weak volume Tempting, but risky Another breakout, over extended Tempting, but risky
• CREE -  Too overextended to buy now - A buy the Dip stock Starting to Dip A buy the dip stock
  
• SNDK – . Overextended now but Buy the Dip stock Dipped then moved higher. Too over extended
  
• VSH – . On another breakout,but in weak volume and overextended -  Too risky. Consolidating and now looking better, a little over extended Tempting
  
• HMIN – Up 4.02% yesterday in breakout, but weak volume. Too Risky Falling Too much downside volume

I like PCLN, VPRT, & SHOO because I understand what they do (buy their products), not because they are technically superior to the other stocks on this list. F (Ford) has just gone up too much. Personally, even though many of these are tempting, I’m waiting till conditions are more favorable to buy.

I would buy dips in IMAX. Thanks to two of you for reminding me they have their earnings report on the 11th. Alice in Wonderland has confirmed people will pay a premium for 3D movies.  With 3D TV’s already being sold and a 3D channel coming I think it clearly going to grow.

Bottom Line - Right now thinking more about selling (taking profits) than opening new positions because of short term over bought conditions.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Football lover Karl Marx

Football and Karl Marx

Football is America’s #1 sport. The Superbowl where (economically shattered) New Orleans Saints beat another small market team the powerful Indianapolis Colts, was watched by more viewers here than any other American sporting event.

Football reins supreme because there is parity in the league or socialism. There is a market cap which no team can go over in payment for all combined players, and a draft for new players where the worst teams choose first.  This is a socialist goose that has been laying GOLDEN revenue eggs for the NF. Unlike baseball that’s hurting for revenue and is in decline because of a less balanced revenue program. In Baseball any team outside major media markets has a far less chance at winning. Each stadium gets packed in football, while only a half dozen do in baseball. Karl Marx would clearly be a football fan.

Now owners and players both want to change the system in a rush of unregulated capitalist greed. So if anyone asks you if socialism works in the USA – you say it sure does – its called the National Football League. Socialism Makes Everbody Rich. Why change it?

Elections – Iceland/Iraq

Two major elections took place late last week

• Iceland – Remember Iceland was perhaps the country worst hit in 2008 meltdown because their shadow banks believed in Greed based capitalism. Over 98% of the voters there voted to renegotiate loans of foreign investors who had put their $ in Icelandic banks.  Seems they did not want to pay back billions with their tax dollars.
• Iraq – Over 2 million Iraq refugees voted from Foreign countries. They are too afraid to return. Still the world’s largest refugee crisis. Even with the elections there are many signs that the different religious/ethnic factions have no intentions of compromise. Oh well, neither do the two major parties in the USA.

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

US equities rallied significantly on Friday. but volume was just a wee bit higher. Long term capital is just NOT flowing into equities in the USA. Unlike the start of the bull market in 2009 when we saw massive amounts of volume. Investors are staying on the sidelines. Volume has been for decades the #1 confirmation factor of a price move. However for the last 6 months its been pretty anemic & useless as a forecasting tool.  Basically this looks technically like we are building a bubble and obviously investors are doubting the rally

The Russell 2000 has already broken out to new highs

Overbought US markets (SPX up 6 days in a row, and up 11 of the last 14 trading days) are all close to new highs. The NASDQ is o.o2 points away from a breakout to a new high.

Last Week’s Fearless Forecast

Investors411 predicted a rally at the week’s start that would get sold into because of an overbought market & the unemployment report – Therefore a “flat week” As stated last Friday - ” The unemployment numbers Friday were as good as it gets for US stocks.” The fact that employment is NOT declining means interest rats will stay low and the Fed will keep flooding the economy with money. From Friday AM -  “Expect a rally.”

Miscalculation about the jobs number (I expected worse than a flat -9.7%) and ignoring looking at the exploding BDI (see below) were the reasons for last week’s miscalculations.

This Weeks Fearless Forecast

The McClellan Oscillator hasn’t been this high (+75.33) since last April. We are also approaching a major resistance level – the January  high of 1150 on the benchmark SPX or S&P 500 (now at 1139).  It seems likely that this level will get challenged.

• Fundamentally it sure looks like the FED has reason NOT to raise interest rates (employment numbers) and that will keep interest rates low – great for stocks.
• The BDI is exploding higher. (see below)
• The Gree debt problem seems to have settled and “will not spread.”
• Any serious attempts at financial regulations seems to be disintegrating.

So fundamentals are moving in one direction against strong technical resistance. Look for a week where at least the NASDQ joins the Russell 2000 and breaks out to a new high, Even though volume is lacking – momentum should make this an up, but volatile week.

Significant Indexes

• McClellan Oscillator jumped significantly to  +75.33 yesterday We are now well above +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK. The only other time we saw numbers on the McClellan move higher than this was three times from November to March 2008/2009. The all time high was +121.86 in the last week of last year.
• BDI – The Baltic Dry Index, which measures the cost of world trade (also a good indicator of how China is doing since they are huge exporters/importers) has exploded higher in the last few weeks = Bulls rule
  

Because Investors411 recently changed the Long Term Outlook to Cautiously Bullish - any pullback in the McClellan Oscillator to say +20 would be an opportunity to nibble again.  This market wants to move higher.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Wish Investors411 had more stock positions (only @20% invested in stocks because of overbought technical situation) Will keep selling into any major rally the remainder of the portfolio.  Certainly a breakout over SPX 1150 would be one of those situations.  Right now what to look for is are stocks going to go “elliptical” (continue to move higher at a rapid rate) and blow through last years high.

Would sell more into that rally and buy/nibble more on any drop in McClellan to @ +20.

IMAX – 3D Alice in Wonderland had a HUGE $116 million dollar opening. Avatar’s opening weekend was $55 million.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Change in Long Term Stock Outlook

See Positions section below for why stock outlook was upgraded and editorial

CNBC – Las Vegas/Glenn Beck

CNBC is easily the #1 financial channel. With shows from “Fast Money” to “Mad Money” CNBC hypes the quick buck on Wall Street by combining the glitter of Las Vegas and the antics of Glenn Beck.  The blatant emotionalism sells for CNBC and their advertisers – the stocks they want you to buy. Confession – I have CNBC on a lot as background when I work and its on right now waiting for the 8:30 jobs report.

CNBC so lauded Greed based Capitalism (“Free markets” as opposed to rules based capitalism) it can be said it was a significant contributing factor to 2008s economic meltdown.

Jon Stewart’s Daily Show took CNBC’s star Jim Cramer to the woodshed over this. CNBC has put together a formula of hype, emotionalism, screaming that sells to fear/greed short term investment crowd.  Indeed this is a style diametrically opposed to the one Nobel prize winning psychologist and founder of Behavioral Economics Daniel Kahneman uses.

(to be continued)

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

Stocks rallied (minor rally) in weak volume AGAIN.  This is the Bull markets mantra. (See editorial and change in Long Term Outlet below) Fundamentally there was some good weekly jobs data, but the big news is the monthly jobs numbers coming out at 8:30 EST this AM

Jobs Report -  February employment numbers  – Unemployment held at -9.7% and jobs down -36,000, a bit better than expected -60,000. January revised down -6000 (minor)

This is about as good as it gets for stocks. The fact that employment is NOT declining means interest rats will stay low and the Fed will keep flooding the economy with money.  Expect a rally.

Good news is monetary policy has helped stabilize the employment decline and we are down from 3 months ago.  The bad news is we are still at 9.7%

Significant Indexes

• McClellan Oscillator slipped slightly to +52.43 yesterday We are now just below +60 or Overbought territory. Stockcharts has a better version of the McClellan chart ($nymo) LINK We are still close to oversold territory, but have fallen over 10 points in last few days. This gives us a bit of up side wiggle room. However, still holding onto the sell more into any major move higher.  The McClellan Oscillator would have to at least get 5 or 10 points above recent high of 62+ to sell.

Because of the change in Long Term Outlook to Cautiously Bullish - any pullback in the McClellan Oscillator to say +20 would be an opportunity to nibble again.  This market wants to move higher.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Even though markets are close to being oversold in the short trm – the Long Term Outlook has been upgraded to CAUTIOUSLY BULLISH. from NEUTRAL The reason for this is technically that the benchmark S&P 500 (see chart) has for 4 days traded above its 50 day moving average. It has also formed a series of higher price highs and one higher low. Yes, volume, the #1 confirmation factor, has been weak, except for the first two+ months of the Bull Market that started in March. In fact, the chart shows volume has basically declined since May.

Behaviorally – there are many investors out there who have been burned by the Capitalism of Greed that they are holding onto other investments like bonds. There are two main possible ways (perhaps more) that these traders would buy into stocks

• Greed based capitalism becomes Rules based capitalism – Some transparency is reintroduced into US financial markets – From standardized mark to market accounting to regulated Credit Default Swaps to eliminating to big to fail institutions.
• Seeing the markets move higher, greed overwhelms those on the sideline and they jump in building another bubble. Its hard to predict exactly what behaviorally would trigger those that are seeking safer havens than US equities.

For decades volume has been the #1 confirmation factor of a price move. This is simple supply and demand economics. The more people that want to buy something (demand) – the higher the price grows (assuming basically the supply of stocks is relatively constant).  In the end something has to give. However, technically, higher highs and crossing the 50 day moving average are both bullish indicators. The lack of volume is the caution.

NB – We are in a position of change and sometimes markets can reverse themselves quickly.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING