Investors 411 Blog

by Barr Jozwicki
May 28, 2010

Million Dollar Quiz

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

The Economic Expert – Clarke & Dawe

Million Dollar Quiz

Some of you younglings may never have heard of Monte Python. The following  two+ minute  videos is drop dead funny, but also incredibly educational on economics Aussie comedians Clarke and Dawe’s Million Dollar Quiz

Stocks

  • HUGE 3% rally in decreased, below average volume. = No confirmation of move higher
  • No fundamental news justified rally.
  • McClellan (as predicted yesterday) rose all the way up to -11.98 now in neutral territory.
  • Dollar fell very significant -1.05%

Analysis -Those massive high frequency traders/institutions that probably make up up to 80% of trades took oversold markets higher.

China saying its not going to abandon the Euro was expected news. It would be absolutely dumbfounding and scary  if mere words from China on Europe could move US markets 3%.   This was a technical rally juiced by a rising Euro & falling dollar.

As we have seen in the past technical rallies can continue in decersed, below average volume.  Comedians Clarke and Dawe touch on some of the negative fundamentals, but forget to mention derivates or bets placed on European debt.

Positions

Investors411 sold 1/2 of positions in IMAX, DGIT & VCI – all for about a 5 to 7% profit yesterday.

Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING


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May 27, 2010

Obama, Obama, Obama

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

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Obama, Obama, Obama

  • The Obama administration is responsible for us still being in Afghanistan & Iraq. He is the commander in chief (see yesterday’s Investors411).
  • His administration is also responsible for the weak financial reform coming out of congress. All Obama had to do it to throw strong vocal support Kafman/Brown, Volker amendment, Lincoln’s derivative bill for them to pass.
  • BP, is responsible for the spill, as are a decade of lax rules and enforcers. But its long past time Obama, the commander in chief, did more than talk tough and blame BP. Yankee Bob has editorial on how expensive fossil fuels really are.

Solutions, Solution, Solutions

  • John Sovjani in comments sections comes up with some innovative fiscal solutions in comments section of blog A gas tax and legalizing/taxing pot are among his choices.
  • Bob Sadinski’s (AKA Yankee Bob) editorial focus is to change more rapidly to alternative energy because of the real environmental costs of fossil fuels. (see link above)

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!

Index Percentage Volume
Dow -0.69% flat
NASDQ -0.68% down
S&P 500 -0.57% down
Russell 2000 +0.41% -

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

Technicals, Fundamentals & Analysis

Stocks roared out of the gate, but fell in the PM as those huge institutions with those giant super computers all sold.  The translation here is – the bulk of all trading is being made by institutions with complex trading algorithm. They take hold of US markets, usually after 2:00PM and determine direction. That direction was down into close = Bearish

Somehow the rumor/news got out that China was considering taking $ out of the Euro. The announcement  was an absolutely dumb move if you’re the Chinese and are doing this. Probably some large entity that is short the Euro or long the dollar created or contributed to this. Markets still very sensitive to negative European news. China has denied this. = Bearish

The McClellan Oscillator sent out a strong bullish signal yesterday. From Investopedia – “Conversely, when a bear market is still declining, but a smaller amount of stocks are declining, an end to the bear market may be near” Yesterday the financial channels (Bloomberg & CNBC reported a lack of breath and volume behind the PM decline)= Bullish

We’ve not had a bear market, but @ a 13% correction. One technical sign that it is coming to an end does NOT make it so. But the MO has been below 60 for a long time and due for a technical correction or a short run higher.

Fundamentals haven’t changed! But we are long overdue for the McClellan Oscillator to move above -60. A technical bounce.

Futures are up in US and European markets higher. = Bullish


Significant Indexes

  • McClellan Oscillator rose to -64.99. [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is still OVERSOLD territory, but we are now out of WAY oversold territory. How the MO works. Yesterday was one of those strange days where the markets went lower but MO went up.= Bullish.
  • US Dollar –  The dollar rose  a significant +0.62% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important. This broke its major resistance level and the dollar is now trading at year + long high. Foe stocks (especially US stocks) =  Bearish

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

Sold last 1/2 of SDS at 35.50 near market close. There was a +5% gain on 1/2 and a 0% gain on 1/2.

Traders – Bought 1% IMAX at 16.70 & DGIT at 42.26 near market close. Reasoning – These stocks were rallying into the close, markets were falling, Monitor (see comments section of blog announced DGIT and SNDK had made new year long highs ) and these two stocks are clearly out performing well over 98% of the market even though they did not hold onto their breakouts. DGIT & IMAX rallied into close as markets fell.

Still long 2%IMAX, 1% ESRX, 2% DGIT and 2% VCI.

I hope IMAX, ESRX DGIT & VCI turn into long term gains, but fundamentally I seriously doubt it. If lucky will take profits (sell 1/2) on any gain of @5% with DGIT. Also will sell 1/2 VCI (dropped over 4% yesterday – should have sold 1/2 when stock was up over 5%) & IMAX in major rally.

Still waiting for dip to buy EUO. If markets rally strongly today.

Traders Investors411 also bought FAS at open and sold it when it fell back to price it was bought for. (actually lost less than 0.4%)  Caution this is a very volatile (3X financials) stock.

TradersTrading strategy – Investors411 is taking @5 % profit on any recently purchased position and letting the rest ride. Investors is then putting a stop/sell order on the price it was bought for.  In volatile markets the only thing to do is make short term trades. Will sell 1/2 of  IMAX, VCI, and/or DGIT if criteria is approached at near open. Selling into rally

InvestorsWait for trend to establish itself.

NB – Friday’s Investors411 will be minimal and published early.

Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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May 26, 2010

War is Making You Poor

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

ALAN GRAYSON

Congressman Alan Grayson

War is Making YOU Poor

There are many ways Americans can cut deficits to make the future more solvent for our children. One presented by Democratic congressman from FD Alan Grayson (short video) Here’s some major point from The War is Making YOU Poor Act

  • We spend 1/2 the world’s entire military budget
  • NATO allies #2 in military spending – Are we going to war with them?
  • Distant third China. War with them would devastate our economy and theirs
  • Keep $549 billion in yearly pentagon budget & eliminate the $159 Billion for Iraq & Afghanistan.
  • Video (link above) has great chart & more complete explanation – so check it out.

How he would spend $

  • No taxes on the first $ $35,000 for every American
  • No taxes on first $70,000 per couple
  • Plus $16 billion a year to reduce deficit.
  • Moderate and low income people spend that tax break money and this would stimulate our economy generating both jobs and further taxes.

So you might spend it differently. But the main point is clear – The War is Making YOU Poor

Sign up to be on Grayson’s newsletter list.

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!

Index Percentage Volume
Dow -0.23% up
NASDQ -0.12% up
S&P 500 +0.04% up
Russell 2000 -0.19% -

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

Technicals, Fundamentals & Analysis

At the open stocks on all major indexes reached lower lows than even the “flash” mistake trading meltdown a couple weeks back. This achieved a lower interday low for stocks. We already have had a lower closing low. The pattern now is lower lows and lower highs. Until that breaks = Bearish

From yesterday - The only silver lining to the up coming storm, is McClellan is oversold and when we get down below -135 we could have another oversold bounce. A 2 to 3% Dow fall in big volume could put us in -120 to -135 territory.

The above happened at the open. In the afternoon the giant institutions with their giant algorithm computers bought into a very oversold market. We rallied  about 200+ points on the Dow to close near even in increased volume. = Bullish

Markets moved higher despite poor global news = Bullish

Analysis – Would expect oversold bounce to continue today. If you are a trader as opposed to investors you could make some short term profits long.

Significant Indexes

  • McClellan Oscillator was flat for the third day in a row. Now at -90.45.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is OVERSOLD territory. = Bullish.
  • US Dollar – Uncertainty reigned as the dollar had a massive range from a new high to almost below Monday’s open. The dollar rose +0.27% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important. Yesterday = Mildly Bearish

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

Yesterday close to open Sold 1/2 position in ESRX at 99.51.& 1/2 position in SDS at 37.21.

Traders & Investors – Reasoning – ERSX was just plain fear on my part of overall bear market. Not a good reason to trade because it was holding up well despite early meltdown. SDS had mad a 5% profit. Because of the extreme volatility and oversold nature of current market I plan to take 5 to 7% profits on 1/2 of all trades and let the rest ride.  This, is because uncertainty/volatility is a clear pattern in the current market.

Looking for dip to buy EUO It’s rallied in weak volume the last few days. May sell SDS (short ETF)

Investors – Until we technically get out of the woods and break the newly established downward pattern only those who love risk should buy. Would suggest the Financial area ETF’s –  XLF.

TradersUYG & FAS (@2X & 3x what XLF does) Financial reform has basically failed and these institutions should continue to exist in the unregulated, over leveraged, shadows of Casino capitalism. Therefore, make profits while they will make privatized profits while your FDIC insurance subsidizes or protects them from any losses.

Apologies - ran out of time to do YOUR stock list. See past comments from Paul R & Monitor Both have made some excellent suggestions in past few days. YOUR stock list is holding up quite well. While major indexes are below their 200DMA’s almost all of the stocks on YOUR Stock List have not reached that big a breakdown.

They both have good ideas that traders can take advantage of in a rally today. YOUR stock list also has good concepts. to pick from.

NB – I’m trying to make a clear distinction between short term Traders who are comfortable holding a stock/ETF less than a week and longer term Investors whose goal it is to hold positions for months and hopefully years.  Everything Investors411 mentions in Positions section is hopefully a long term position

.

Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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May 25, 2010

Quantum Economic Shift

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

Quantum Economic Shift

Both Jim J & JAB sent in a Simon Johnson & Peter Boone article on how bad the European/American situation-

Unregulated finance, the ideology of unfettered free markets, and state capture by corporate interests are what ended up undermining democracy both in North America and in Europe. All industrialized countries are at risk, but it’s the eurozone – with its vulnerable structures – that points most clearly to our potentially unpleasant collective futures.

Investors, still have what happened in 2008 fresh in their minds. Now the European debt crisis is upon us. It doesn’t take a behavioral economist to predict what will happen. Fear is twice as powerful as greed according to behavioral economics.

Casino capitalism advocates (Tea Party followers & others) are going to blame European socialism. They are in part right. Patronage, corruption and socialism that went too far exacerbated their debt problem. (see yesterday’s Investor’s411 and Fridays for additional warnings about what’s happening)

Bottom Line – Wolves have wormed their way into the henhouse of capitalism, the US congress, and the Obama administration. Debtor nations, with over leveraged, non transparent shadow financials are privatizing gains and socializing risk. The worst is yet to come.

Why trust these two? Because they have been right again and again. Here’s Johnson and Boone on May 8th questioning the stock market at its hight. Unfortunately as Johnson and Boone warn its not the wolves (shadow institutions and free market capitalists) who are going to pay – it you, me and now Europeans.

Our ship is sinking and the captain that steered it into an iceberg in broad daylight is getting rescued and given another ship.

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!

Index Percentage Volume
Dow -1.24% down
NASDQ -0.69% down
S&P 500 -1.29% down
Russell 2000 -1.24% -

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

Technicals, Fundamentals & Analysis

US markets fell into the close as dollar soared. =  Bearish

Significantly Lighter Volume indicates things have settled down for a while.= Bullish

Markets still way oversold (see McClellan Oscillator) = Bullish

Dollar’s massive rise = Bearish

Fear over Europe and North Korea (war drums) has futures way way down.

Analysis – Investors411 has been too slow in exiting positions despite making repeated warnings and changing long term outlook to CAUTIOUSLY BEARISH

Mistake not to invest more in SDS as mentioned yesterday

The only silver lining to the up coming storm, is McClellan is oversold and when we get down below -135 we could have another oversold bounce. A 2 to 3% Dow fall in big volume could put us in -120 to -135 territory.

Significant Indexes

  • McClellan Oscillator rose slightly to -89.94 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is OVERSOLD territory. = BullishRepeat -Hate to say this, but once the trend broke this index has become less effective.
  • US Dollar – Friday the dollar rose again to $86.36 Up a massive +1.16% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important .  = Bearish..

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

The whole positions section has been refurbished. Many thanks to one of you who helped and wants to be anonymous.

One of the cardinal rules of investing is don’t loose large amounts of $

Yesterday Sold

  • 1/4 IMAX at 17.88
  • 1/2 IMAX at 17.52
  • 1/2 FAS at 24.45
  • 1/2 of FAS at stop loss of 23.75
  • 1/3 of ESRX at 101.25
  • 2% position bought in SDS at 35.25

Remaining long positions 1% IMAX 2% VCI & 2% ESRX. 2% position in SDS is short.  While all these are out preforming major indexes – They haven’t fallen past their 200 DMA – I’ll be looking to cut back more long positions in any in rally today. Still very interested in owning these companies, but overall bearish trend is established.

New Stock/ETF List

Tomorrow our old “YOUR Stock List will return

Bottom Line - Now is NOT the time to think about going long but  to start to think about using SDS and similar ETF’s that short the market (2X short S&P 500) in a rally.

All the following will go up when stocks go down (TLT is exception but a flight to safe investments and generally moves opposite US stocks)  If we fall to a major correction (Dow now down 10% and falls to 20% – these ETF will make YOU $)

  • EUO – Ultra short’s the Euro (ultra = 2x)
  • EPV – Ultra short the big companies of Europe (new – very thinly traded)
  • SDS – Ultra Short S&P 500
  • QID - Ultra short QQQQ(tech stocks)
  • TZA - 3X short small cap stocks
  • TLT20 year treasury Bond fund

Investors411 will open a position EUO on first dip and add to ultra shorts on rally.

Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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May 24, 2010

Black Swan

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

Cygnus atratus photographed in January of 2003 using a Canon D60 digital camera and Canon 100-400mm image stabilized lens

Nassim Taleb – “BlackSwan”

Black Swan

There are many doom and gloom prognosticators out there. There are a lot of Johnny Sunshine’s too. Paul R comment’s are today’s editorial. Checkout the other excellent recent comments too. I strongly urge you to also read the 10 points in his referenced Financial Time article.

“Back on Feb 10 Barr mentioned the “Black Swan”. I caught the Wall Street Journal Report on TV last week and they interviewed Nassim Taleb author of many Black Swan articles.

A quick search of the net for “black swan” I found his recommendations for a black swan proof world. LINK

http://www.fooledbyrandomness.com/tenprinciples…

I really like #2.

2. No socialization of losses and privatization of gains. Whatever may need to be bailed out should be nationalized; whatever does not need a bail-out should be free, small and risk bearing. We have managed to combine the worst of capitalism and socialism. In France in the 1980s, the socialists took over the banks. In the US in the 2000s, the banks took over the government. This is surreal.

Bottom Line – Nassim Talib – who was right about the 2008 meltdown wrote this article on April 7 2009.

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!

Index Percentage Volume
Dow +1.25% flat
NASDQ +1.14% flat
S&P 500 +1.50% flat
Russell 2000 +1.45% -

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

Technicals, Fundamentals & Analysis

Markets recovered a bit on Friday. Some of this may be options expiring.  Nothing to get excited about because as state Friday major support levels and trend lines have been broken.  This usually means the worse is yet to come.

We moved higher because markets were way oversold (See McClellan Oscillator)

Fearless Forecast Last week – Down market at beginning of week and rally at end – was right. But overall prediction of “up week” was obviously toast.

Fearless Forecast This Week - Trend lines and major support levels have been broken. I think European Central Banks like our Fed and Treasury will do whatever it takes to stabilize the Euro.  But the long term damage to their GDP is significant and impacts the world. Hard to see a market recover if GDP is falling. Systemic problems in capitalism and social welfare have to be fixed and this is going to hurt. More investors realize this and sell this week.= Down week.

Obviously expect a roller coaster ride again. Idiot Democrats and Republicans have NOT fixed the “too big to fail” or over leveraged problem that got us into this mess. About 1/3 of the Senators get it – Those that voted for Brown/Kaufman legislation.

Significant Indexes

  • McClellan Oscillator rose to -90.99 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is OVERSOLD territory. = Bullish. Repeat -Hate to say this, but once the trend broke this index has become less effective.
  • US Dollar – Friday the dollar fell again to $85.36 Down a significant -0.52% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important . . Obviously European & other Central Banks are stepping up to buy the Euro.  Looks like this will stabilize the Dollar/Euro relationship at least for now This is good news but markets have failed to move higher on good news = Bearish
  • VIX- The “fear” index is at 40 and back in Oct. 2008 it reached 90. We have a ways to go before we reach 2008 fear levels.

Stock markets are totally ignoring their record oversold conditions and the drop in the dollar. Major trend lines have been broken. Bad reactions to good news is a powerful warning sign that the worst is yet to come. Technically, Friday’s gains need a confirmation and trend line reestablished before going long.

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

The whole positions section has been refurbished. Many thanks to one of you who wants to be anonymous who helped.

Usually most positions have stop/loss orders 5 to 7% below what they were bought for. The 12% loss in UWM was due to the fact that UWM gapped lower the next day. The huge 40+% gains in IMAX was because they wee bought months ago.

Forgot to mention Friday a 2% position in VCI.

Purchases made on Friday all have stop/sell orders on them at or @2% below the price they were bought for.  Except for 50% of IMAX. and 100% of VCI. Their stops are a bit lower.

NB – Would NOT invest now, but if you are an experienced short term trader you could nibble. – Only on huge dips. Don’t make the mistake I did and hold short term positions over weekend. Get in , make 5+% profit , sell 1/2 and let the rest ride, or get out.

Friday – we saw the Dow dip 100+ points even after the McClellan Oscillator was at a record low of -136. So the dip would have too be quite large before nibbling again.

Bottom Line – Now is not the time to think about going long but  to start to think about using SDS and similar ETF’s that short the market (2X short S&P 500) in a rally.

Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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May 21, 2010

World has Changed

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

Bears Rule

The World Has Changed

We, had a huge shadow financial meltdown in the USA. A massive fiscal response that held up markets worldwide and prevented the second Great Depression. Now, the PIIGS in Europe, who like the USA created massive over leveraged debt, are melting down. The contagion is spreading worldwide.

The root cause, obviously is no checks and balances on casino capitalism which has led to over leveraged massive debtor countries (including the USA) falling even further into debt and continuing their huge opaque financial structures We have not yet fixed the too big to fail or over leveraged problem in the USA. Some consequences from the changing wolrd:

  • GDP worldwide is going to fall
  • Jobless rate in USA and other debtor nations going to grow.
  • If casino capitalism or “free markets” continue to run wild the situation will worsen.
  • BP disaster is just another example of unregulated casino capitalism and no government enforcement.
  • Democrats are in Huge trouble because they lack a coherent national leader who backs Main Street.
  • The EU is structurally damaged as is the USA
  • The core issue of too big to fail shadow financials could rip the financial structure of the world into another Great Depression.

KISS & Too Big to Fail

Giant over leveraged shadow banks are FDIC Insured. Shadows take your $, plus printed $ from the Fed & invest it in opaque, over leveraged shadow investments. Once you allow this over leveraged situation to occur on a debtor nation (latest example Greece) putting Humpty Dumpty back together again is a nightmare.

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!

Index Percentage Volume
Dow -3.60% up
NASDQ -4.11% up
S&P 500 -3.90% up
Russell 2000 -5.09% -

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

Technicals, Fundamentals & Analysis

Huge decline in significant, increased, above average volume. This looks like the beginning of a parabolic move down. Similar to the one in 2008.  Another day of selling like the last and you’d have technically a climax sell off. Then maybe some stabilization. = BEARISH

Far more than the 200 DMA has been broken on the benchmark S&P 500. Virtually all technical trend lines that show bull market momentum have fallen for all major indexes. = Bearish

Sell off accelerated into close and European markets again lower this AM. = Bearish

Dow is now off 10.5% from highs. Historically a 20% correction = a new Bear market

Today is a confirmation day of yesterday’s fall.

It’s going to take a while to sort out things in Europe and many are betting that the debt Crisis will sink the European Union. Problem in a nut shell is China, Germany & petro countries are big exporters and the rest of the world is over leveraged creditors.

Significant Indexes

  • McClellan Oscillator fell to record lows -136.21 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is OVERSOLD territory. = Bullish  Hate to say this, but once the trend broke this index has become less effective.
  • US Dollar – Yesterday the dollar fell to $85.81 Down a significant -0.54% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important . . Obviously European & other Central Banks are stepping up to buy the Euro.  Looks like this will stabilize the Dollar/Euro relationship at least for now. = Bullish.
  • VIX- The “fear” index is at 45 and back in Oct. 2008 it reached 90. We have a ways to go before we reach 2008 fear levels.

Stock markets are totally ignoring their record oversold conditions and the drop in the dollar. Major trend lines have been broken. Bad reactions to good news is a powerful warning sign that the worst is yet to come.

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

Have not had a chance to update the positions section of blog yet. Will update last weeks trades over weekend. All losses under 10%, some gains but its not pretty.

Sold remainder of UWM & ICON at yesterday’s open. Also 1/2 of ESRX & 1/2 of IMAX at open yesterday – most for losses (except IMAX). Positions below. Everything else has been sold last week or this week.

Positions  -

  • 2% IMAX
  • 1.5% ESRX

Just on a technical basis, another massive sell off in increased volume & Investors will buy back IMAX & perhaps ESRX or another stock that has held up well over the meltdown.

From yesterday – Any close below the 200DMA on the S&P 500 will change outlook to CAUTIOUSLY BEARISH We came close yesterday.

Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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May 20, 2010

Danger Will Robinson Danger Danger

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

Mad Hatter from Tea Party

Bravo Arizona

The most under reported election story yesterday-Arizona, like most states is faced with a budget problem, faces massive cuts especially in “education, police, health care and other services”  Arizona, is a conservative state.  They voted to RAISE TAXES by an overwhelming 64% Story LINK

Tea Party

The most over reported story by American media – Kentucky. Raul Paul (Ron Pail’s son) and a Tea Party favorite won election and beat the Republican establishment candidate. Paul and the Tea Party was all over the National media and you heard almost nothing about the Democrat winner Jack Conway. Despite the following facts -

  • Both Conway and his challenger gathered more votes than Paul in this traditionally Republican state.
  • 35% more Democrats voted than Republicans in KY.
  • This was a close race and they usually get more attention than those with easy victories

The problem is the Tea Party’s ability to have American media be their lapdog.  This media bias is a HUGE problems for Democrats.

Oil Smothers Coast

Headline Huffington Post headlines and has photos

Investment Analysis of EU Crisis

Below under Positions

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!

Index Percentage Volume
Dow -0.63% up
NASDQ -0.82% up
S&P 500 -o.51% up
Russell 2000 -1.22% -

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

Technicals, Fundamentals & Analysis

Both the Dollar and the US markets fell = Bearish

Increased, average, volume on down day = Mildly bearish

$9 billion was taken out of mutual funds last week = we are loosing the retail investors = Bearish

Rally into close – probably due to dollar falling and Fed minutes suggesting growth = Bullish

Strongest sign = The dollar fell significantly & stocks did not end up positive = BEARISH

From Yesterday – All of this is about the European stability and survivability. If this EU falls so does the worlds largest economic zone. (it’s slightly bigger than the USA) The good news for Europe is the lower the Euro goes the better it is for their exports

Significant Indexes

  • McClellan Oscillator fell to -105.37 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is OVERSOLD territory. The lower this oscillator go the more oversold markets become. =  Bullish
  • US Dollar – Yesterday the dollar fell to $86.28. Down a significant -0.84% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important . The area around $88 is a major resistance area/ multi year high for the dollar. Obviously some entity(ies) are stepping up to buy the Euro. (see analysis below) Looks like this will stabilize the Dollar/Euro relationship at least for now. = Bullish

There’s more Bearish than Bullish above and futures are way way down. We have FEAR on Wall Street.

Time to bring out the Old Lost in Space Robot and Shout DANGER WILL ROBINSON DANGER DANGER The 200DMA of the benchmark S&P 500 is going to fall at open and that should bring on a lot of long term investor and programed trade selling.

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

Have not had a chance to update the positions section of blog.  No buying & selling yesterday.

We moved deeper into OVERSOLD territory, McClellan now at -105.37 = The momentum on the downside is strong. We are again near low two weeks ago of  -123 and the Oct. 2008 meltdown low of @-130

Stopped out of the rest of SNDK yesterday.

Yesterday IMAX took a -3.79% hit in well below average volume. If it has a similar day today it will be close to it’s 50DMA and a buy the dip opportunity

Analysis of EU Crisis & Investing - When the McClellan Oscillator reached a low of -130 in 2008 we stood on the verge of a meltdown or collapse of the banking and insurance companies all across the world. People were already lining up and many had taken uninsured $ out of banks on that Friday.

The question is are we on the verge of a collapse of the European Union? The crisis, of course, is all part or a continuation of the 2008 meltdown (over leveraged shadow financial structures) The EU was created to insure the prevention of war (WW2), to stand as a block against the Russia, and be an economic power in its own right. It’s combined GDP is greater than the USA. If this Union were to disintegrate the world’s economy could easily suffer a meltdown. If European banks meltdown and the whole worldwide opaque, over leverage banking system  could again stand at the edge of a cliff.

If you think the EU will dissolve or be irreparably damaged, the fallout will be HUGE across the world – Probably a second Great Depression. In this case the McClellan will go below -130

My read of the tea leaves is this will NOT happen.  Central European banks and Central banks will print whatever money it takes and inflate their way out of this like the USA. Bailouts have already started. Yesterdays rally in the Euro and decline in the dollar was probably due to European Central Bank (maybe others too) buying the Euro. But it will get ugly before it gets better.

Therefore, buy the dip, is still the option Investors411 will use it.  However, taking profits on UWM & probably loss in ICON at open or on any rally today.

Short term there is just too much downside momentum and we are in danger of braking 200 DMA on benchmark S&P 500. This trumps everything else!

If we have a climax sell off, will nibble on dip.

Any close below the 200DMA on the S&P 500 will change outlook to CAUTIOUSLY BEARISH We came close yesterday.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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May 19, 2010

Incumbent Toast

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

joe_sestak.jpg

Admiral Sestak (above) beats 30 year incubate Specter in PA Senate Democrat race

Incumbents Get Toasted

From TalkingPointsMemo.com a rundown of last night’s election across the USA. In almost every case incumbetes lost or did far worse than expected (D – AR.). The only exception is in PA – 12 John Murtha’s old seat where Democrats had a bigger than expected victory over Republicans for the congressional seat. Ron Paul’s son won Republican primary in KY.

Both the far left and far right (Ron Paul) are supporting Teddy Roosevelt like changes to Wall Street.  Libertarian, Ron Paul on the far right wants us out of the MidEast (and other areas our troops occupy) far more than any other Republican and most Democrats.

SCOREBOARD – UPDATED 2:41 AM

PA-SEN (D) Votes
Sestak 54%
562,037
Specter 46%
479,934
99% reporting
AR-SEN (D) Votes
Halter (runoff) 43%
138,477
Lincoln (runoff) 45%
144,989
Morrison 13%
42,317
98% reporting
AR-SEN (R) Votes
Baker 11%
15,840
Boozman 53%
73,708
Coleman 5%
6,876
Hendren 4%
5,490
Holt 17%
24,199
98% reporting
KY-SEN (R) Votes
Grayson 35%
124,238
Paul 59%
206,159
99% reporting
KY-SEN (D) Votes
Conway 44%
226,773
Mongiardo 43%
221,269
99% reporting
PA-12 House Votes
Burns R 45%
60,167
Critz D 53%
70,320
99% reporting

Republican’s Blocking Financial Reform

The following comes from Left wing Huffington Post. Republicans blocking Three Major Financial Reforms

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!

Index Percentage Volume
Dow -1.08% up
NASDQ -1.57% down
S&P 500 -1.42% up
Russell 2000 -1.86% -

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

Technicals, Fundamentals & Analysis

Its all about the Dollar. The dollar rose a HUGE +1.07 % and consequently stocks took it on the chin. Dollar is at 87.11 and close to major resistance at just above $88.  The McClellan Oscillator is in oversold territory at ironically the same -88. We sent a record at -123 a week back.  This probably means we could fall another 2 to 4% at on the major indexes before technically a turn becomes almost inevitable.

At some point in time this year stocks will reach +60 on the McClellan like they did almost 10 times last year.

Germany made a solo move and banned naked short selling (a good move , but a lack of coordination with Euro bad) Story = Bearish

All of this is about the European stability and survivability. If this EU falls so does the worlds largest economic zone. (yes its slightly bigger than the USA) The good news for Europe is the lower the Euro goes the better it is for their exports

Significant Indexes

  • McClellan Oscillator fell to -88.08 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is OVERSOLD territory. The lower this oscillator go the more oversold markets become. -123 was the multi year low over a week ago.  Bullish
  • US Dollar – Yesterday the dollar rose to $87.11. (sorry for misprint yesterday,dollar started the day near 86) Up +1.07 [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important . The area around $88 is a major resistance area/ multi year high for the dollar.

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

Have not had a chance to update the positions section of blog.  No buying & selling yesterday.

We are deeper into OVERSOLD territory, McClellan at -88.08 = The momentum on the downside is strong. It looks like we will reach or approach -123 again.

Our top two stock positions IMAX & ESTX are holding up quite well. Others are at or approaching the prices they were bought at.

Still own 5% position in UWM. Stopped out for 2% loss on other 5% Still looking at situation as an upcoming drops as buy the dips.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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May 18, 2010

YOUR Stock List

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

Photo – flickr/JM Rosenfield (CC-BY)

Poverty & Race

Brandeis University’s AEIS yesterday published a report on Poverty and Race. Headline. The wealth gap between Afro Americans and White has increased fourfold from 1984 to 2007

  • First to pick up on story was, of course, media outside the US – UK Guardian
  • Middle and Upper class Whites 5 times richer than Afro American counterparts.
  • Gap accelerating

Mind the Gap

How do we fill the gap of energy need between now and 2030? More than a dozen comments were made pointing out the dangers of nuclear energy and drilling offshore. Yep I agree. But only one of you yesterday , D, came up with a possible solution – natural gas and suggested the following sight – The Pickens Plan

Two Funny SNL Videos

The following two SNL video’s were sent in by HG. Their both very funny.

  • Conservatives over exaggerate the amount the following contributed to the economic meltdown and shadow banking crisis, but Progressives almost totally ignore this aspect -


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!

Index Percentage Volume
Dow +0.05% down
NASDQ +0.31% down
S&P 500 +0.11% down
Russell 2000 +0.25% -

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

Technicals, Fundamentals & Analysis

Its all about the Dollar.  Yesterday’s rumor/fact was the Euro Central Banks (perhaps our Fed helped) were all intervening to prop up the Euro. Euro goes up, dollar stabilizes, & stocks move higher.

Most likely senerio is Euro Central Banks will keep buying and use the $88 (Dollar) resistance level as help. See below for more.

Best read of the tea leaves - Like the Fed, The European Central Banks will Print whatever money it takes to stabilize the Euro.

Significant Indexes

  • McClellan Oscillator fell a wee bit to  -68.22 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is OVERSOLD territory. Bullish
  • US Dollar – fell yesterday after an early rise to $87.00. Down -0.05 [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important Technically, the move much higher and closing lower usually indicates a short term reversal of trend. However, the upside trend has had such momentum behind it, it is still likely that the $USD will reach its $88 resistance level before the end of the month. Support & resistance levels often act like magnets for stock prices.

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

Have not had a cha to update the positions section of blog.  As stated yesterday “Since the McClellan is oversold - we’ve reached Buy the Dip territory.”  Investors 411 bought UWM (5% of portfolio) at 33.44 and put a stop 2% below the bought price. This may turn out to be a short term trade.

ICON (a 2% position) was also bought at 16.68

We are still in OVERSOLD territory, McClellan at -68.22 = Investors411 will still be Nibbling on dips.

YOUR Stock List

Caution - This is mostly just technical analysis and lots of other factors enter into a decision to buy or sell.

For last weeks stock list and comments use calender at top of blog. Click on Tuesday May 11th.

Terminology

  • 50 Day Moving Average of price- blue line on chart = 50DMA
  • 200 Day Moving Averagered line on chart = 200DMA
  • Ticker symbol for each stock is a link to a chart.
  • Volume – Horizontal red (down days)and green (up days) line at bottom of chart show volume
  • * Owned positions
  • “Volume decent” – translation – relative to major indexes individual stock is looking good – probably more upside volume on rally days than downside volume on toasting days.

Most of you are looking for longer term buys. Remember Stocks are in most cases riskier than most ETF’s. Our main strategy is to buy the dip of a stock that is trending higher.

The issues YOU have chosen to invest in have outperformed all US major indexes.

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

  • CAAS –  50DMA moving down means this stock is no longer trending higher. One criteria stock to make this list is its trend. Trading below 50 DMA
  • PCLN –   As stated poor earning hurt Priceline. 50 DMA moving down.
  • CSCO, & AAPL CSCO missed on earnings (one reason not to hold stocks during quarterly earnings reports) Underperforming market AAPL is the last standing big cap tech leader. Ominous sign for technology. AAPL volume & price show little difference than overall US markets.
  • SHOO –  The 50DMA is its support line & SHOO came close yesterday. Will rally if the market does. Seems to have some juice left. Little too much downside volume. Riskier, but Buy the Dip
  • *ICON,  Bought the dip yesterday after stock dipped and bounced off its 50DMA. Outperforming markets. Volume decent. Buy the Dip
  • DGIT –   Still overextended, but has dipped in weak volume. You’d love another dip day, but this stock is too juicy for traders not to notice and push higher. Outperforming markets. If you can get it before it rallies buy. Buy the Dip
  • *VCI. – Wish I had bought the dip yesterday. Outperforming markets. Decent volume. Buy the Dip
  • *SNDK – Decent volume. Outperforming markets. Consolidation pattern forming. 50DMA is its support level. Buy the Dip
  • CTRP – Volatile & Risky. Decent volume. Outperforming markets. Like to live dangerously Buy the Dip
  • *ESRX - Outperforming markets, Volume decent. Has strong resistance level at @105. Consolidating. Breakout candidate. Buy the dip
  • *IMAX – Outperforming markets. Volume decent. Still # 1 choice. Buy the Dip
  • MSPD – Volume decent. Consolidating pattern. 50DMA acting as support line. Buy the Dip

Analysis-

  • The McClellan Oscillator is at -68 = oversold = Buy.
  • The Dollar rules (see above for analysis)
  • Good opportunity for traders – The dollar’s decline/flattening may only last a short time and we will probably reach the $88 mark before early June. This would be a better entry point for longer term investors However it is impossible to predict what the European Central Banks will do.

NB – We are going to need some new candidates for YOU Stock List Post them on the blog or send them to me. Please send in no more than 3. Like before, those send in by more than one person will get preference, but I’ll be the final judge. Must past the following two tests.

  • 50DMA moving higher
  • $5,000,000 a day in sales – example a $10 stock that trades 500,000 shares – price times volume.

.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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May 17, 2010

The Energy Problem

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

-

The Energy Problem

Here’s the energy problem the world has to solve – The question is how. From May 24th’s Forbes – “Worldwide electrical generation is projected to increase 77% by 2030″ according to energy Secretary Steven Chu.  That’s just electricity.

How does the world and the USA as a nation meet this energy demand?  It takes 10+ years to get a possible wind farm off the coast of Massachusetts that in the end will produce 1/2 to 3/4 of the electricity for Cape Cod.  It’s easy to make a case against off shore drilling or nuclear energy, Build a case for a viable solution.

Any takers?

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!

Index Percentage Volume
Dow -1.51% up
NASDQ -1.98% up
S&P 500 -1.88% up
Russell 2000 -2.44% -

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

Technicals, Fundamentals & Analysis

US markets dropped as The Dollar rose. The rise in the dollar vs. the Euro is anchoring or pulling stocks lower. This is the dominant theme driving the market.

Volume rose, but was only slightly above average = Mildly Bearish

Markets rose in the last 30 minutes of trading = Bullish

Nothing really happened over the weekend in Europe, but the NYT is headlining Fears Intensify That Euro Crisis Could Snowball = Bearish

Bottom Line - Almost everyone is short the Euro and long the Dollar = The dollar is going to go up & this is going to negatively impact stocks. However, technically, the dollar is more extended over its 50DMA than any time since 2008. If it goes up about another $2.00  it will reach a strong resistance level (the old 2008 highs).  This should at least in the short term, should stem the fall. (see chart below) = Bullish

The McCellan Oscillator has reached OVERSOLD territory = Bullish.

Fearless Forecast Last Week = “Up week” – Correct call

Fearless Forecast This Week = McClellan is OVERSOLD Territory and the Dollar is Overextended from its 50 Day Moving Average.  We may see a wild roller coaster ride, but by end of week stocks should inch higher.

Best case senerio – Stocks fall early this week as dollar rises and we get closer to @$88 resistance level for the dollar. The McClellan goes lower. This would set up an even better buying opportunity.

We have now entered Buy the Dip territory, especially for traders.

Longer term  Investors- The Euro, as the NYT article states could snowball lower, but at least temporarily, there is a short term trading opportunity that could be presenting itself. The dollar is what to watch.

Significant Indexes

  • McClellan Oscillator fell dramatically to -65.45 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is OVERSOLD territory. Bullish
  • US Dollar – rose +1.00% yesterday. [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important Dollar Rules because it broke out to new high is a significant move. = VERY BEARISH

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

Investors411 exited all positions mentioned Friday as market opened.  The only ETF position left is 5% in UWM bought two Friday’s ago.

Investors almost also has all the stock positions from YOUR Stock List. Sold 1/2 of SNDK at open on Friday.

Since the McClellan is oversold - we’ve reached Buy the Dip territory. (see above)

Longer term traders – every time we get below -60 on the McClellan its time to nibble.  The further below the better. The recent low was -123

Yes, best read of tea leaves is for markets to move lower at the start of the week. If your panicked about loosing some $ in the short term, sell at the open.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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