Investors 411 Blog

by Barr Jozwicki
September 28, 2011

Get Money Out

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

Get Money Out

Get the money out of politics. YOU can make a difference.

You can continue to be sheeple or perhaps take that first step

All you have to do is sign the petition then pass it on to your friends.

If you don’t fight for your democracy who will?

  • Obama’s biggest contributor (bundled) was Goldman Sachs
  • Romney’s biggest contributors are from Wall Street.
  • Chairmanships of congressional comittees are now decided on who gets the most contibutions from the sector they govern. (Example Banking comittee – the poll who got the most $ from banksters gets to be chairman)

Want to know more LINK

Last Blog for Week

Back Monday

__________________


Stocks

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES


The below Chart is from ETF Digest’s David Fry. David shares the same cynical opinion that Investors411 has on High Frequency Trading (HTF’s) that dominate stock trading.

His Chart shows what happened to US equities (specifically the influence of HTF’s who are “in charge”)

SPY 5 MINUTE

__________________

Market Analysis

Focus on TechnicalsFundamentals & HFT’s

  • “Window Dressing” Rally – This is the last week of the 3rd 1/4 for stocks. Just like the last weeks of so many other quarters we are in rally mode. A major reason behind this weeks rally is window dressing and a reason stock markets should continue to advance until the end of October (Friday). Many of our YSL stocks are outperforming, in part, because of this.
  • Trend Kicking the can down the road on Greece is mana from heaven for HFT’s who can use every news items to execute short squeezes, pump and dumps or catching institutional traders with losing long positions. An extremely strong correlation exists between European and US markets.
  • Long Term Stock Trend - The benchmark S&P 500 (see chart on right side of blog) has spent the entire months of August and September trading below the 50 & 200 day price moving average (red and blue lines on chart) – Any credible analyst will tell you that’s a bearish sign.

Investors411 Technical Forecasting Tools.

  • The PCR rose to +1.13 (Roughly - above 1.25 is getting Bearish and below 0.80 is getting Bullish. 1.00 = same amount of puts and calls. Over last two years the highest for PCR is @1.50 and lowest @0.60 - anything approach these levels shows change likely For more information on PCR LINK) Above 1.00 which makes it a wee bit bullish, but overall = Neutral

The McClellan Oscillator

  • (MO) rose  to +22.95 (Rough estimates =-30 somewhat oversold, -60 oversold, -90 OMG oversold & +30 somewhat overbought, +60 overbought and +90 OMG overbought) Another rally will bring the bears out, but for now = Neutral

__________________________


Reading The Tea Leaves

Short Term Outlook

days, week+

  • Both Forecasting tools have shifted to Neutral.  But HFT dominated markets have built up some major momentum  - So chances are we’ll keep moving higher till overbought indicators start flashing a turn around.
  • Financials (ETF = XLF) are the sector to watch. Long term their chart is bearish, like the S&P 500. Shorter term there is a series of lower highs and lows on the chart = bearish. No market rally can sustain itself without this group.
  • Bottom Line for rest of weekBulls still have the momentum, till the MO and PCR reach overbought levels.

Longer Term Outlook

month, months

  • Repeat Same old mantra May 20th forecast still stands. The May 20th summer forecast has come to pass and now we wait to see the Fed’s next move. Add to this Europe is a whole lot worse than previously thought back in May. For the Fed to act significantly – inject more liquidity - I’m afraid we need to see stocks do worse for that to happen.

_________________________


Detective

Demystifying and Discussing

Simple Option Strategies


by JS


PUTS


(Note:  I volunteered for this column when I saw no one else did, and I had years of experience using calls, especially for increasing income on stocks I own.  However I’ve limited experience in using puts, but I can see ways they are very useful.) [Mucho Thanks from all of us - editor]

Put options are a way to force someone (the person who sold you the put) to buy the stock at a fixed price, no matter how much lower the price of the stock currently is.

Note: you don’t actually sell it to someone personally; it’s like buying or selling stock. When you sell, someone invisible  (or an institution) is at the other side, buying it.

Using put options

Puts protect you from indecision and accidents.  Example: if you own CROX and want to protect profits, or you just bought it and want to limit your loss in this volatile market, this put can do it.

-CROX111022P27 (Oct 22, 2011, strike price of 27).   Friday CROX closed at $27.58.  If you paid $27.58 and you bought this put at the same time, this is how you stand:

  • Sock price ………………..$27.58
  • Put price …………………..$ 1.95
  • Cost……………………… …$29.53

If CROX drops, your loss is limited to $29.53 -$27.00 (strike price of put) or $2.53, a little less than 10%.  But the beauty of this is that if it drops, you can still hold CROX till Oct 21 before you “put” it  at $27. It could go down to 20 in a bad day, but you can keep holding it in case it rebounds, and in this market, it very well can. If it goes up past $29.53, you are into profit. In this market, if CROX is a good pick, it could go much higher.

The negative: no profit till $29.53.  The positive: you limit your loss to 10%. If you bought CROX at a much lower price, you’ve also protected your profits.

Put option: negative: increases cost of stock. Positive: real protection till Oct 22. And you can hold stock in case it recovers quickly and reaches profit level.

Please note:  The title of this column is “Demystifying and DISCUSSING Simple Option Strategies”.  It is very helpful to readers of Investors411 if some of you who use options, post some comments.

_____________________


Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)

NLYWill buy back into  this high dividend stock on Dip. The date you have to hold the stock comes up on Wednesday. Since the 1/4ly dividend is usually between 3 and 4% the stock often goes down close to that amount after this date. Everyone expects this so Put’s offer little protection for this incident.

GLD - From Two days ago – (Investors411 did not make this trade) Traders who can handle the risk – a third gap down at open and another  significant fall should bring us to longer term support levels. GLD is at very oversold levels. This risk on trade worked like a charm. Investors411 on trades takes 1/2 off the table after +5% and sets a stop loss at the price the stock/ETF (GLD)was bought for. Let the rest ride. Kudos for whose who made $$$

Traders - The risk on trade has worked and now watch for overbought signs (MO & PCR) as an exit and a reversal of the trend.

Investors - This is a crowded trade, but I think it’s a winner.  Short financials and long small caps or technology. There will be a slightly different price at the open.

  • Short Financials – Investors411 will use ultra short SKF (closed at 78.91)
  • Long technology - Investors411 will use ultra long QQQ (tech’s) QLD (closed at 81.13)
  • It helps that the prices re almost equal.
  • Of course, those who know how to use puts (on financials) and calls (on technology) – this is another way to go.

Exit strategy – I do hope to hold this into the end of the year, but will exit  if it looses over 7% and take some profits after +5%.

Disclaimer I buy everything in the hypothetical Investors411 portfolio. If stock is mentioned and I own it you will know.

_________________________


Long Term Outlook

(for US stocks only – not our economy)

CAUTIOUSLY BEARISH*

*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

  • Share/Save/Bookmark
September 27, 2011

Blowing Our Horn

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

Blowing Our Horn

We all make Mistakes, but Investors411 is on a winning streak.  The blog has outperformed the benchmark S&P 500 for over 6 years.

We’ve had a string of wins this year that included some major gains (long and short) gold/silver a few month back.  Some of the recent wins are in today’s blog.

  • Investors411 Hypothetical Portfolio gained @+11 over the same period the S&P lost @-17% (recently closed positions in GLD & NLY)
  • YOUR Stock List up +7.48 vs +1.96% for S&P
  • Our new “Risk On” trend indicator has recently been even more accurate than past trend reversal indicators

__________________

Stocks

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Index Percentage Volume
Dow +2,53 down
NASDQ +1.53% down
S&P 500 +2.33% down
Russell 2000 +2.26%

__________________

Market Analysis

Focus on TechnicalsFundamentalsHFT’s

  • Friday started a typical HFT driven, low volume, oversold bounce. Monday turned the typical HFT driven bounce into a low volume rally, and today,  just like so many times before the HFT’s should drive stocks higher in low volume as they merrily bust short positions (puts – see PCR below)
  • TrendKicking the can down the road on Greece is mana from heaven for HFT who can use every news items to execute short squeezes, pump and dumps or catching institutional traders with losing long positions.
  • Trend - Economically both Europe & the USA are deteriorating. The major question is how damaged is the opaque, over leveraged, too big to fail  shadow banking sector. Our Fed and its allies are doing everything possible to ensure survival and growth. Here’s a positive editorialWhy Europe Won’t Implode.

Investors411 Technical Forecasting Tools.

  • The PCR fell  to 1.03 (Roughly - above 1.25 is getting Bearish and below 0.80 is getting Bullish. 1.00 = same amount of puts and calls. Over last two years the highest for PCR is @1.50 and lowest @0.60 - anything approach these levels shows change likely For more information on PCR LINK) Two days just above 1.25 was followed by two days above 1.00.  Just a touch more Puts (backlog) for HFT’s to play with is a wee bit bullish, but overall = Neutral

The McClellan Oscillator

  • (MO) fell  to -11.87 (Rough estimates =-30 somewhat oversold, -60 oversold, -90 OMG oversold & +30 somewhat overbought, +60 overbought and +90 OMG overbought) = Neutral

__________________________

Reading The Tea Leaves

Short Term Outlook

days, week+

  • Both Forecasting tools have shifted to Neutral.  But HFT dominated markets have built up some major momentum  - So chances are we’ll keep moving higher till overbought indicators start flashing a turn around.
  • Path of least resistance for HFT dominated US markets is higher.

Longer Term Outlook

month, months

  • Repeat Same old mantra May 20th forecast still stands. The May 20th summer forecast has come to pass and now we wait to see the Fed’s next move. Add to this Europe is a whole lot worse than previously thought back in May. For the Fed to act significantly – inject more liquidity - I’m afraid we need to see stocks do worse for that to happen.

_____________________

Paul’s Corner


It’s amazing how well most of YSL 5 stocks have done during the last few weeks of market paranoia. As of Monday’s close YSL5 +7.48 vs +1.96 for the S&P 500, that’s from the close of Aug 18 to yesterday’s close.

Chris asked yesterday when we could expect an all clear. I have no idea at the moment, as I suggested yesterday in the comments section when we have Eureka’s and Kahunas coming out of our ears then it will be safe for the retail investor (us).

AKRX has really performed quite well during these past few weeks. It’s a good stock to nibble at provided you have a market heading in the correct direction.

One of my favorite HGSI indicators is the Force Index.  It’s a simple indicator, you take today’s close minus yesterdays close and multiply by today’s volume. You then list your stocks from highest to lowest and the strongest stocks of the day are at the top.

Using the average of 2 and 13 day Force index, when you have a positive 13 and an occasional pull back on the 2 day force it’s a good entry point. Look at the chart of AKRX,  on 9/9 and 9/12 the 2 day force  went negative. On 9/13 as the 2 day force turned positive it was a “safe” buy when the price climbed above the previous days high of 8.08. You could have left the house 9/13 with a buy stop order of 8.10 and when it crossed 8.10 you had your buy. If it didn’t go in the right direction, your order wasn’t filled.

Chart Image Link

AKRX got a wee bit extended this past week and was taken to the woodshed yesterday in a pull back. Give it a few days to settle down again before attempting another buy.

Chart Comments

AKRX  – pulled back off of extended territory, give a few days to settle down

ABV – sitting on the 200 buyable if it stays above the 200 and best buy when it climbs up through the 50

NLY – Pulling back below the 200, earnings history show earnings decreasing

AAPL – buyable when it dips to the 17

CPHD – all indicators green

CMG – all indicators green

CROX – sitting on the 50 buy at any time

GMCR – in a buy the dip position, buy when it crosses up through the 17 (107.60)

HANS – buyable at any time

HLF – sitting on the 50, buyable

LULU – in a dip, buyable when it crosses the 50, (56.21)

RES – strong pull back at the moment, not a broken stock.  Energy analyst Lou Powers suggested today:

The ERX Energy Canary was singing yesterday for the Day traders but too early to determine the energy sector direction. Up over 10%. In the recent downturn essentially all energy stocks suffered big losses in spite many with strong earnings growth potential.

TSU – Broken chart not a safe buy

ZAGG – Broken chart not a safe buy.

DISCLAIMER -  these comments are for education ONLY. They are not security buy or sell recommendations. This market isn’t safe for average folks!

Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)

NLY - Will buy back into  this high dividend stock on Dip. The date you have to hold the stock comes up on Wednesday. Since the 1/4ly dividend is usually beeween 3 and 4 % the stock often goes down close to that amount after this date. Everyone expects this so Put’s offer little protection for this incident.

Gold - From Yesterday -  Traders who can handle the risk – a third gap down at open and another  significant fall should bring us to longer term support levels. GLD is at very oversold levels. What you’ve seen is HFT and others stage a short covering rally.  I could be wrong,  and I have not had time to look study the PCR for GLD, but its ripe for a bounce.

Traders - From yesterday - We still have a risk on trading opportunity. Investors411 “RISK ON” has worked  perfectly so far. Using the MO, PCR and some technicals we’ve found some key elements as to when the trend will reverse itself. (Reminder nothing is perfect – but first the MO was good and a combo with the PCR seems to work even better.)

There looks like more follow through today, but as we move higher you start to think about cashing in some of those profits.

How to Forecasting tools – More and Bigger Bullish signals from the MO & PCR – the better your chances of a winning trade. The more and bigger the Bearish signal from MO & PCR - the better your chances are of going short or taking profits

Investors - For Europe, Japan and the USA the economic outlook is poor. If US does start constricting money supply, history will repeat itself and we’ll have another recession. The silver lining for stocks is they can do better than the economic outlook. This will be due to central bank manipulations and HFT’s.

Disclaimer - I buy everything in the hypothetical Investors411 portfolio. If stock is mentioned and I own it you will know.

_________________________

Long Term Outlook

(for US stocks only – not our economy)

CAUTIOUSLY BEARISH*

*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

  • Share/Save/Bookmark
September 26, 2011

The Good Fight

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

The Good Fight

Elizabeth Warren’s 2 minute viral video that has exploded across Massachusetts (From USA Today)

_________________________


How YOU Pay More Than a Billionaire

Warren Buffett said it best - “His secretary has a higher net tax rate than he does.”

The primary cause for this is the uber weatlhy from trust fund babies to hedge fund managers pay only 15% on their capital gains tax.  If you work you pay 15%, 25%, 28%, 33%, or 35%

All uber wealthy individuals has to do is invest in HFT hedge funds (60+ % of all US stock investing – that make $$$ of market trading imbalances) or invest  in the unregulated opaque $600 trillion Credit Default Swaps (Financial WMD’s – Warren Buffett) market. Are YOU wealthy enough to invest in HFT’s or CDS’s?

The uber wealthy through institutions can sit back and take massive gains (privatized gains) Then pay 15% on those gains.

The sucker American taxpayer and ordinary investor who is working his/her butt off not only pays more taxes, but has to bail out the too big to fail shadow institutions. (socialize risk)

Wake Up People

You’re Being Played for a Sucker



__________________

__________________


Stocks

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Index Percentage Volume
Dow +0.35% down
NASDQ +1.12% down
S&P 500 +0.61% down
Russell 2000 +1.40%

__________________

Market Analysis

Focus on TechnicalsFundamentalsHFT’s

  • Last weeks meltdown came to a halt at support levels for the major indexes. Friday started a typical HFT driven, low volume, oversold bounce.
  • Trend Kicking the can down the road on Greece is mana from heaven for HFT who can use every news items to execute short squeezes, pump and dumps or catching institutional traders with losing long positions.

Investors411 Technical Forecasting Tools.

  • The PCR fell  to 1.15 (Roughly - above 1.25 is getting Bearish and below 0.80 is getting Bullish. 1.00 = same amount of puts and calls. Over last two years the highest for PCR is @1.50 and lowest @0.60 - anything approach these levels shows change likely For more information on PCR LINK) Two days just above 1.25 was followed by yesterday’s 1.15 = Bearish/Neutral

The McClellan Oscillator

  • (MO) fell  to -42.55 (Rough estimates =-30 somewhat oversold, -60 oversold, -90 OMG oversold & +30 somewhat overbought, +60 overbought and +90 OMG overbought) Somewhat Oversold. = Bullish/Neutral

__________________________

Reading The Tea Leaves

Short Term Outlook

days, week+

  • We have again bounced off support levels with a slight HFT dominated low volume  rally Friday. Momentum is with bulls.
  • Path of least resistance for HFT dominated US markets is higher.

Longer Term Outlook

month, months

  • Repeat Same old mantraMay 20th forecast still stands. The May 20th summer forecast has come to pass and now we wait to see the Fed’s next move. Add to this Europe is a whole lot worse than previously thought back in May. For the Fed to act significantly – inject more liquidity - I’m afraid we need to see stocks do worse for that to happen.
  • Energy , Financials and Copper (proxy for global growth) all made significant new lows ThursdayLong Term Bearish.
  • US Dollar – Investors411 has used the dollar many times before tp forecast market direction. It’s worth noting an upside breakout Chart. That’s bearish for stocks and gold. The contrarian side of this is a strong dollar, low interest rates/inflation coupled with a weak stock market give the Fed a reason to launch another liquidity move (QE #3) This would drive stocks higher.

_____________________

Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)

NLY – Will buy back into  this high dividend stock on Dip.

Gold - Major move to downside. If the Fed comes out with QE #3 gold should instantly regain its shine. For now its fallen too far too fast to buy. Traders who can handle the risk – a third gap down at open and another  significant fall should bring us to longer term support levels. GLD is at very oversold levels. Perhaps a trade, but not an investment.

Strong dollar is significant factor in gold’s meltdown.

Traders - We still have a risk on trading opportunity. Our two forecasting tools are slightly bullish, but not yet at the more extreme levels where its even safer to buy. Rising dollar is counter weight to an extended rally, but momentum with bulls.

Investors - Thursday’ lead story is the Long Term Outlook for the Fall.  If the Fed introduces more liquidity, or by some miracle without Fed help technicals show an upside breakout of the trading range we are in (S&P 500 at 1136 – Range 1120 to 1220) – Outlook remains CAUTIOUSLY BEARISH outlook remains.

You can find YSL #5 in Positions Section of blog.

No long term positions held at this time (See last Friday’s blog for more)

DisclaimerI buy everything in the hypothetical Investors411 portfolio. If stock is mentioned and I own it you will know.

_________________________

Long Term Outlook

(for US stocks only – not our economy)

CAUTIOUSLY BEARISH*

*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

  • Share/Save/Bookmark
September 23, 2011

Disfunction Junction

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

Civil Rights Victory

Those that watched the Republican debate last night or read about it, know that a gay soldier who asked a question was booed  by the audience. Shameful. Gay rights is this generations civil rights issue like integration was ours back in the 60′s.

The repeal of “Don’t Ask Don’t Tell” was obviously a major step. Decade long poll numbers, especially among younger Americans, are increasing in support of gay rights. Excellent editorial from Huffington Post (Photo also from HP) by Aaron Belkin on “How We won.”


Ron Suskind

Disfunction Junction

Failure to Regulate Banking industry is coming back to haunt investors and again threaten the world economy. When you listen to shadow bank CEO cry and whine crocodile tears about too much regulation ask them to name one banker whose gone to jail over the Wall Street 2008 financial crisis (remember Madoff ran his own seperate ponzi scheme which he got away with for years)

Also give them Matt Taibbi research that shows how in bed the limited amount of investigators are with the industry.

Today

  • Shadow Banks have their own special accounting system. The do not have to “mark to market” accounting.
  • Shadow Banks operate on the unregulated $600 trillion dollar Credit Defaults Swaps Exchange. (no one knows who buys and sells)
  • Shadow Banks are also invested in everything from home loans to Greek bonds to CDS’s on French Banks.

As an investor, do you want to invest in the shadows of an opaque banking system when all you have is some CEO saying – “We are not over leveraged?” No wonder Financials (XLF) are leading stocks lower.

Pulitzer Prize winner Ron Suskind has a new book, Confidence Men, that focuses on Obama’s failure to act on banking regulations.

__________________

__________________


Stocks

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Index Percentage Volume
Dow -3.51% up
NASDQ -3.25% up
S&P 500 -3.19% up
Russell 2000 -3.18%

__________________


Market Analysis

Focus on TechnicalsFundamentalsHFT’s

  • A major meltdown in increased volume. The support levels for the major indexes held. We did near the end of the day break support for Dow & S&P, but rallied near close. This is Bullish in short term.
  • However, Copper (JJC) (proxy for global growth) Financials (XLF) & Energy (XLE) all made major new lows. This is bearish long term
  • Europe continues the meltdown today At 8:44 EST down 1.43 to 2.33%   Stockcharts homepage has up to minute listings in one easy to read box of US & Europe
  • TrendKicking the can down the road on Greece is mana from heaven for HFT who can use every news items to execute short squeezes, pump and dumps or catching institutional traders with losing long positions.

Investors411 Technical Forecasting Tools.

  • The PCR fell slightly to 1.27 (Roughly - above 1.25 is getting Bullish and below 0.80 is getting Bearish. 1.00 = same amount of puts and calls. Over last two years the highest for PCR is @1.50 and lowest @0.60 - anything approach these levels shows change likely For more information on PCR LINK)  Not at extreme reversal levels but we have two days above 1.25 = Bearish/Neutral

The McClellan Oscillator

  • (MO) fell  to -66.82(Rough estimates =-30 somewhat oversold, -60 oversold, -90 OMG oversold & +30 somewhat overbought, +60 overbought and +90 OMG overbought) Oversold, We did hit a record low of -140 on 8/8. So, while oversold, we could go lower. = Bullish/Neutral

__________________________


Reading The Tea Leaves

Short Term Outlook

days, week+

  • Forecasting tools more Bullish than Neutral. This indicates risk on trading opportunity. If you can handle the risk the odds seem to be in your favor. Investors411 conservatively prefers to wait for a better situation – In this case a bigger dip that leads to more extreme reading on the MO & PCR.
  • Best read of the tea leaves is HFT’s and pros can make more $$$ by breaking support levels and increasing panic. Also the lower the market goes the more pressure on Bernanke to do QE #3.

Longer Term Outlook

month, months

  • Repeat Same old mantraMay 20th forecast still stands. The May 20th summer forecast has come to pass and now we wait to see the Fed’s next move. Add to this Europe is a whole lot worse than previously thought back in May. For the Fed to act significantly – inject more liquidity - I’m afraid we need to see stocks do worse for that to happen.
  • Energy , Financials and Copper (proxy for global growth) all made significant new lows yesterday = Long Term Bearish.
  • Yesterday’s lead editorial contained reasoning behind long term outlook – CAUTIOUSLY BEARISH.

_____________________


Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)


Yesterday Investors411, as stated, sold all positions. Now looking for more of a dip to buy.

Traders – We have a risk on opportunity that The Critic (see comment section of blog) took yesterday. Our two forecasting tools are with the bulls, but not yet at the more extreme levels where its even safer to buy.

Investors - Yesterday’s lead story is the Long Term Outlook for the Fall.


Positions


NLY - Annaly Capital Mgt. Ultra high dividend stock –a @14% dividend NLY was bought in mid May at 17.14

Sold at 17.70 for 3+ gain add to that a 3 to 4 % dividend check and total = almost +7%. Not bad when you consider the benchmark S&P 500 was down @-17% in the same period. Again Investors411 beats its benchmark S&P 500.

Mea Culpa – In retrospect this was a poor time to sell. NLY had done well through the meltdown. Unfortunately yesterday’s warning to sell covered all stocks. NLY is nearing the date you have to hold the stock to get the dividend. A period NLY usually rises. Will buy back on dip.


GLD – (Long Gold ETF) Bought at 167.05 - Sold 1/2 for 8% gain.

Sold remaining GLD at 167.05 for 0% gain. GLD hit the stop/loss order. Total for trade +4%

Looking to buy back into GLD – Gold fell yesterday because so many were liquidating positions from hedge funds and money managers, the managers sold GLD to cover those cash redemptions. This occurs often on major meltdown days.

Why gold? – Europe is going to try to join the USA in zero% interest rates sometime down the road and Bernanke will probably be forced to use printing press to help Europe and USA get out of economic problems. This will again be bullish for gold. So again - buy the dip.


Investors411 Portfolio gained @+11% while the S&P lost @-17%


DisclaimerI buy everything in the hypothetical Investors411 portfolio. If stock is mentioned and I own it you will know.

_________________________


Long Term Outlook

(for US stocks only – not our economy)

CAUTIOUSLY BEARISH*

*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

  • Share/Save/Bookmark
September 22, 2011

Danger Will Robinson Danger Danger

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

Federal Reserve Note, 1914, $10,000

Fed Reserve Note 1914

Assault On The Fed

Background

  • Bernanke,  received a minority (22) Republican Senate votes for his reelection as Fed chair last year.
  • Rick Perry has called the Fed actions “almost treasonous” LINK
  • Top two Republicans in both House and Senate have told Bernanke to stop stimulating the economy. (See above LINK)
  • Ron Paul and other Tea Party candidates have called for abolition of Fed.” LINK

Given

  • When Fed stimulus programs first started US quarterly GDP had fallen to between -4 & -5%
  • The benchmark S&P had fallen to 666.
  • 7 quarter years later US GDP rose from -5% to over +3%
  • The benchmark S&P rose from 666 to 1200.
  • Unemployment in same period went from over -700,000 to +200,000 a month.
  • Martin Feldstein [Reagan's Chief economist] Fed stimulus is reason stocks go higher and strong performance of US economy

Republicans/Tea Party Take over congress in 2010

  • Call for no compromise, focus on cutting government instead of stimulating economy, No tax cuts/stimulus for even small business or extension of payroll tax cut. (Obama Jobs plan) They threaten Bernanke.
  • Investors411 warns May 20th that stimulus will run out and downgrades stock outlook. Another downgrade today
  • GDP falls from +3.3% to +1.5% (last quarter), jobs from +200,000 to 0 created each month.
  • There is almost no sign of inflation in the USA as Treasuries are at their lowest ever.- The arguement used against stimulus
  • Richard Koo - warns that every time Japan’s government contracts money supply GDP fell. When government added money/stimulated economy GDP rose.
  • 100% no accident that this economy started to turn as the Tea Party started to rise.

Conclusion - It took the most massive government stimulus ever to bring us out of the Great Depression – World War 2.  Republicans are growing in power and that means a contraction in government spending. The Fed is under assault and they want Bernake’s head and any stimulus to stop. (No QE 3 – No tax cuts for small business)

We are being pulled back into the Great Recession by the withdrawal of stimulus. Both the end of Obama’s $787 stimulus winding down and QE 2′s end – Predicted on May 20th by Investors411. The rise of the anti stimulus (even tax cuts for small business) contract the money supply, Republicans is the catalyst behind this downgrade.

It doesn’t matter if Republicans don’t want any form of stimulus to heap blame on Obama/Bernanke for problems or they are true believers of cut government stimulus/spending and GDP will grow.

As long as the constrict the money supply side gains power, stocks and more importantly the economy will suffer.

Danger Will Robinson Danger Danger

Investors411 The Long Term Outlook is changed to CAUTIOUSLY BEARISH

Today’s meltdown, is only the start if there is no additional stimulus and we continue to contract the money supply then even the old 666 on the S&P could be challenged in the next few years.

The Lost In Space Robot (old TV Show) that shouted when danger was around went off with a huge commotion and shouted

Danger Will Robinson Danger Danger.

__________________________________


Stocks

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Index Percentage Volume
Dow -2.49% up
NASDQ -2.01% up
S&P 500 -2.94% up
Russell 2000 -3.68%

______________________________


Market Analysis

Focus on TechnicalsFundamentalsHFT’s

  • Fed did pretty much what was expected (Operation Twist), but added word “significant “ to downside economic risk. Stocks toasted after Fed announcement and into close.
  • Moody’s downgrades BAC, WF, & C – Entire banking sector (ETF - XLE) huge drop - 4.16% Now directly above major support. If this sector breaks support today BEAR’s RULE
  • HGSI’s Ron Brown (from Paul) reminds us yesterday that the first move after a Fed announcement is often a “head fake.” But he didn’t have two data points above
  • HFT’s & pro’s can make more $$$ if they panic institutions & investors. XLE will break support and shadow banking sector will lead stock lower.

Longer Term Outlook

month, months

  • Repeat Same old mantraMay 20th forecast still stands. The May 20th summer forecast has come to pass and now we wait to see the Fed’s next move. Add to this Europe is a whole lot worse than previously thought back in May. For the Fed to act significantly – inject more liquidity - I’m afraid we need to see stocks do worse for that to happen.

_______________________


Paul’s Corner

Looks like the market thumbed its nose at Operation Twist and sharply sold off after the news.  Just a sell on the news or are we in for more trouble?  Ian Woodward posted a great blog last evening with very detailed analysis of what to watch for in the market action.

LINK

All sorts of talk coming out from the Republican candidates on how to create jobs, suggestions range from eliminating the minimum wage, reducing government regulations, lowering corporate taxes and more. Amazon.com has a distribution warehouse in Allentown Pa. Read about how they have created jobs and the new work place conditions we all can look forward to in the new reality.

LINK

HGSI is having another informative webinar next week Sept 28. You do not have to be a HGSI user to benefit from the free webinar. Here are the details:

Join us on Wednesday, September 28th from 8:00 pm until 9:30 pm for “Prospecting and Trading in a Weekly Timeframe” by Ray F Ebert, PhD.

Ray will share his disciplined weekly trading strategies using HGSI and other software. He will provide technical analysis of prospects submitted by the audience.

Earlier this year Ray was selected to be a “Spiker” on SpikeTrade, a trading community managed by Dr. Alexander Elder and Kerry Lovvorn. In his first quarter as a Spiker Ray won first place for equity and second place for points in the weekly competitions. He also leads the Washington D.C. area HGSI User Group.

Register at: LINK

Looking at individual YSL 5 stock action yesterday after the Operation Twist announcement caution is suggested. If you dare to play please use real stops and don’t keep lowering your stop if your stock sells off.  ZAGG is getting toasted at the moment and needs some time to settle down and correct.

Detailed YSL 5 analysis this weekend, maybe. Watch the comments section.

Remember, you are responsible for your investment decisions, and I am not. Please do your diligence, and please take ownership for your actions because I‘m sure not going to.

_______________________


I am exiting all long stock positions – Today’s meltdown may rebound, but the long term outlook remains bleak for stocks as long as the folks who want to contract money supply, are gaining power. (I’ll wait on GLD till it hits its stop/sell)

What would change this outlook is more stimulus from our Fed to Europe & USA. A realization that constricting money supply hurts stocks and the economy/GDP growth by a greater segment of the population. Unexpected GDP growth  Europe, emerging markets, USA.

HFT’s are obviously powerful enough to manipulate stocks up and down within a range.

_________________________


Long Term Outlook

(for US stocks only – not our economy)

CAUTIOUSLY BEARISH

*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

  • Share/Save/Bookmark
September 21, 2011

Bernanke

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

Questions of the Day

Can this man and his fellow Fed Governors keep the world out of depression/recession and  more worldwide stock markets falling to the bears – pictured below???

Fed meeting concludes this afternoon with an announcement.

How long can the Fed keep the Kabuki Dance going with a shadow unregulated financial system at its core???

It’s hard to answer these questions in the long term, but in the short term US equities have run up against technical resistance (this summers high) and one important predictor of worldwide economic growth [copper prices] is heading south big time.

Our two forecasting tools (MO & PCR) are still in Neutral. So best read of the tea leaves is HFT’s, that dominate trading, have no bias.

However, the drop in copper signals further slowdown in worldwide growth.  Advantage Bears.


  • Share/Save/Bookmark
September 20, 2011

YSL#5 Toasting S&P Again

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

YOUR Stock List gains = +12.55%

S&P 500 gains = +5.66%

See Stock section & Paul’s Corner below for more

____________________________

Warren Buffett – “My Secretary has a higher tax rate than me.”

Yesterday Barack Obama put some teeth into his economic plan that started with $250 billion in tax incentives for the engine of small growth – small businesses in the USA.  Editorial from Sam Stein. The lead editorial from the NYT -

“This is not class warfare. It’s math. The money is going to have to come from someplace.” It could come from the middle class, from the elderly and the poor, by asking them to give up benefits from programs like Medicare, Medicaid and food stamps — as many Republicans are advocating. It could come by pulling money from road building, schools, food inspection and other vital government services.

Those are unacceptable choices, he said, particularly if the rich give up nothing, and he made it clear he would veto any plan that cut Medicare but did not raise revenue from the rich.

One Particular area that Obama deserves applauds for is the potential for savings (One trillion in 10 years) in the military budget. Obama has lead us form a “you’re with us or against” Iraq war foreign policy to a far less costly yet effective Arab Spring/Libya foreign policy.

Investors411 has consistently maintained the focus should be on jobs creation, and fixing our shadow “too big to fail” financial system. But, this is a solid, overdue “change we can believe in.”


_____________________________


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!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Index Percentage Volume
Dow -0..94% down
NASDQ -0.36% down
S&P 500 -0.98% down
Russell 2000 -1.69%

______________________________


Market Analysis

Focus on TechnicalsFundamentalsHFT’s

  • A big stock loss was more than cut in half by rally late in day. Bullish sign.
  • Trend – How stocks react to European news dominating right now. Our two major forecasting tools give us a good idea how stocks will react to news. Overbought markets don’t move much on good news. Oversold markets can more significantly on good news.
  • Big news of the week is FOMC meeting and announcement Wednesday. A surprise would move stocks higher.
  • Trend Kicking the can down the road on Greece is mana from heaven for HFT’s who can use every news items to execute short squeezes, pump and dumps or catching institutional traders with losing long positions

____________________________


Investors411 Technical Forecasting Tools.

  • The PCR fell to 0.99 (Roughly - above 1.25 is getting Bullish and below 0.80 is getting Bearish. 1.00 = same amount of puts and calls. Over last two years the highest for PCR is @1.50 and lowest @0.60 - anything approach these levels shows change likely For more information on PCR LINK)  Four basically flat days in a row close at @ 1.00. The last time the PCR got below 1.00 we rallied. = Neutral

The McClellan Oscillator

  • (MO) fell dramatically to +14.07 (Rough estimates =-30 somewhat oversold, -60 oversold, -90 OMG oversold & +30 somewhat overbought, +60 overbought and +90 OMG overbought) = Neutral

____________________________


Reading The Tea Leaves

Short Term Outlook

days, week+

  • Both forecasting tools in Neutral
  • YSL #5 had an outstanding day yesterday. LINK (scroll down) or See Paul’s comments. Since the majority of these stocks are high growth stocks, and these kinds of stocks are usually leaders in a bull market = Bulls are waking up. AAPL (Mother of all tech stocks and a YSL #5 stock) had a significant up day.
  • Fed/Bernanke probably needs to “surprise” traders/investors for rally to continue. Something called Operation Twist, seems to be priced into this rally already.

Longer Term Outlook

month, months

  • Repeat Same old mantra - May 20th forecast still stands. The May 20th summer forecast has come to pass and now we wait to see the Fed’s next move. Add to this Europe is a whole lot worse than previously thought back in May. For the Fed to act significantly – inject more liquidity - I’m afraid we need to see stocks do worse for that to happen. I now believe I may be wrong about stocks having to be lower for the Fed to do more. There are a lot of analysts who expect more stimulus or a surprise at the Fed meeting Wednesday.
  • We do have a technical series of higher highs and higher lows building on major indexes. Also a technical bottom that’s been retested. That’s bullish

_______________________


Paul’s Corner

Great day for many of the YSL 5 stocks and a fair day in the market as many stocks are starting to move, BUT keep in mind the PIIGS news still over shadows the market. If you care to play don’t jump in blindly.

Quality growth stocks will always beat the S&P  500 and YSL 5 is doing well. Current gain is 12.11% vs. 5.56% since the Aug 18 Start. Here is the group performance analysis:

GPA Link

A good way to check the individual stock performance of your portfolio is to look at the Relative Strength of each stock. Using HGSI the following chart shows the % gain against the S&P 500 for the past 4 weeks. Note the S&P 500 equals 100, so if a stock has a number of say 117 for AKRX it means AXRX has done 17% better than the S&P 500. Looking at ZAGG with a number of 85 means ZAGG has done 15% less than the S&P 500 for the past 4 weeks.

RS Link

The following are YSL 5 chart observations and are made for education only. They are not a suggestion to buy or sell any stock.

AKRX – Broke out of a 6 week base 4 days ago. Extended, buy any dip.

ABV – Sitting on the 50, basing

NLY – Chart Ok

AAPL – Broken out, extended

CPHD – Extended, breaking out of lose base

CMG – Breaking out, extended

CROX – Sitting above the 50, very loose

GMCR – Basing above the 17

HANS – Good chart buy any dip

HLF – Basing above the 50

LULU – Break out from lose base

RES – Bounced off of lower trading channel

TSU – All HGSI indicators are red

ZAGG – Chart broken down, most indicators red

The  US Fed Reserve is providing stimulus to Europe, why aren’t the Tea Baggers and their lackey Republican hacks yelling about this and the cost to Mericans?

Remember, you are responsible for your investment decisions, and I am not. Please do your diligence, and please take ownership for your actions because I‘m sure not going to.

_____________________________


Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)

6 trading days ago we retested lows and Investors411 stated that for those who could stand the risk it was time to nibble. Forecasting tools are in Neutral, but the mojo is with the bulls.

NLY - Annaly Capital Mgt. Ultra high dividend stock –a @14% dividend NLY was bought in mid May at 17.14 Now at 18.16

GLD (Long Gold ETF) Bought at 167.05 - Sold 1/2 for 8% gain. GLD closed at 173.31. Gold is contrarian to stocks and More willing to buy more than sell right now

Disclaimer I buy everything in the hypothetical Investors411 portfolio. If stock is mentioned and I own it you will know.

_______________________


Long Term Outlook

(for US stocks only – not our economy)

NEUTRAL*

*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

  • Share/Save/Bookmark
September 19, 2011

Stimulus Works

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

Stimulus Works

Richard Koo, Japan expert and Economist points out the similarities between the USA and Japan’s “Lost Decade” in Money magazine (pg. 61) His conclusion is that deficit reduction right now in the USA will do the same thing as it did in Japan. Perhaps worse. Here’s his major points. (sorry Money magazine is not on line.)

  • The USA was ultimately pulled out of the Great Depression by a massive government stimulus/spending program – World War Two
  • Japan’s economy started to go south in 1991. Whenever government spending was raised GDP grew.
  • In early 1997 Japan cut spending and GDP shrank from @3.5% (per quarter) to almost -3% in less than a year. The gov’t then raised spending and GDP rose to 2.5%.
  • When Obama launched his $787 billion stimulus program the the GDP was close to -5%. It improved to +3% in a little over a year. Now that the stimulus is running out we are again falling in GDP growth.

The stimulus program, which Republicans have labeled as a failure, helped increase USA GDP from -5% to +3%. That’s a massive success. Now its running out and we are again slipping in GDP. All everyone talks about is shrinking spending. Dr. Koo has a great point and history will repeat itself  if we let it happen.

For more on Koo LINK here

Stimulus from Bernanke and the Fed’s QE1 & 2 helped us recover.

__________________

__________________

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!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Index Percentage Volume
Dow +0..66% up
NASDQ +0.24% up
S&P 500 +0.57% up
Russell 2000 +0.11%

_______________

Market Analysis

Focus on TechnicalsFundamentalsHFT’s

  • It was the one day a month options expire (3rd Friday of month) so volume was up.
  • The leading party in Germany (Merkels’s CDC) did poorly in a Berlin election. They’ve lost last 6 of 7 elections. More bad news – Former UK PM says 2011 is worse than 2008, and Strass Kahnn ( the French NYC sex scandal guy/former IMF head) say Greece is finished. Italy PM is again over his eyeballs in a sex scandal.
  • Big news of the week is FOMC meeting and announcement Wednesday. A surprise would move stocks higher.
  • Trend - Kicking the can down the road is mana from heaven for HFT who can use every news items to execute short squeezes, pump and dumps or catching institutional traders with losing long positions

Investors411 Technical Forecasting Tools.

  • The PCR was flat at 1.02 (Roughly - above 1.25 is getting Bearish and below 0.80 is getting Bullish. 1.00 = same amount of puts and calls. Over last two years the highest for PCR is @1.50 and lowest @0.60 - anything approach these levels shows change likely For more information on PCR LINK)  Three basically flat days in a row close to 1.00 = Neutral

The McClellan Oscillator

  • (MO) fell slightly to +46.98 (Rough estimates =-30 somewhat oversold, -60 oversold, -90 OMG oversold & +30 somewhat overbought, +60 overbought and +90 OMG overbought) Somewhat oversold  = Bearish/Neutral

___________________

Reading The Tea Leaves

Short Term Outlook

days, week+

  • The excessive amount of “Put” positions has switched to Neutral. The MO is at Somewhat oversold.  This means that bad news will probably now have a negative impact on stocks. We have had some negative news out of Europe this AM (see above.)
  • Technically, Still more  Neutral than Bearish, but Bears are starting to growl. Bearish bias into Fed meeting Wednesday.
  • Fed/Bernanke needs to “surprise” traders/investors for rally to continue.

Longer Term Outlook

month, months

  • Repeat Same old mantraMay 20th forecast still stands. The May 20th summer forecast has come to pass and now we wait to see the Fed’s next move. Add to this Europe is a whole lot worse than previously thought back in May. For the Fed to act significantly – inject more liquidity - I’m afraid we need to see stocks do worse for that to happen.
  • We do have a technical series of higher highs and higher lows build on major indexes.

________________

Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)

Friday, Investors411 waited for more favorable conditions to go short or buy gold. Unfortunately we had only a minor rally and not a big one which would have given us a solid  technical advantage.

Mea culpa – I often wait for a good trading situation to get even better, before I enter the trade. Right now it looks like the minor rally was good enough to make a move. Gold has rocketed in Europe this AM and stocks fallen.

Positions

NLYAnnaly Capital Mgt. Ultra high dividend stock –a @14% dividend NLY was bought in mid May at 17.14 Now at 17.93

GLD (Long Gold ETF) Bought at 167.05 - Sold 1/2 for 8% gainGLD closed at 176.03. Gold is contrarian to stocks and More willing to buy tan sell right now into a stock rally.

Disclaimer I buy everything in the hypothetical Investors411 portfolio. If stock is mentioned and I own it you will know.

_______________

Long Term Outlook

(for US stocks only – not our economy)

NEUTRAL*

*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

  • Share/Save/Bookmark
September 16, 2011

Amerigasm

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

Jon Stewart

Amerigasm

On Monday night we had the CNN/Tea Party sponsored Republican Debate. “A truly remarkable pairing, as a fringe often derided incopetent bunch of yahoos was granted legitimacy by pairing with the TEA Party.”

How totally incompetent was CNN.? How horribly low and devolved into spectacle has news become? Watch the Jon Stewart video Their debate rivaled The World Wrestling Federation in hype and spectacle.

Our mainstream news media as devolved into a very laughable parody.

Einstein

Relativity

Obama’s Job Program

This week many of you made some excellent comment on Obama’s job program.

  • Content credible
  • He proposed how to pay for it – again credible with more to come next week on cuts to entire budget.
  • It’s political – Obama  intends to run on this.
  • Republicans have no plan or ones that include cutting taxes on big business/wealthy, and no specifics on deficit reduction.

Relativity – We have a patient whose dying and Obama’s job plan does offer  the patient  a pint(s) of blood. But the problem is that the wound is open and bleeding.

We have a dysfunctional shadow gambling/financial system that need regulating and regulators. This shadow system is now impacting Europe. Major US companies continue to bleed US jobs overseas.  Until the wound is stitched and closed the prognosis – negative.

__________________

__________________

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!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Index Percentage Volume
Dow +1.66% down
NASDQ +1.34% down
S&P 500 +1.72% down
Russell 2000 +1.33%-

_______________

Market Analysis

Focus on TechnicalsFundamentalsHFT’s

  • Another HFT  algorithm induced low volume rally as Europe played kick the can down the road over Greece defaulting on its loans.
  • The massive, hidden in the shadows, unregulated (Who knows how much each bank’s exposure to PIIGS country debt there is?) $600 trillion Credit Default Swaps (CDS)  market is forecasting doom while the HFT dominated US & European stock markets this week (big rally) forecast sunshineLINK
  • You could trust rumors, politicians,  pundents/bloggers, stock markets, CDS markets on Europe’s debt crisis. Yuck, what a choice. This analyst will freely admit I don’t have the information (its all hidden in the shadows) to even begin an evaluation. I do believe Greece will do some kind of default but far more important — what happens to the financial sector is in the shadows.
  • Trend - Kicking the can down the road is mana from heaven for HFT who can use every news items to execute short squeezes, pump and dumps or catching institutional traders with losing long positions

Investors411 Technical Forecasting Tools.

  • The PCR fell a wee bit 1.05 to 1.02 (Roughly - above 1.25 is getting Bearish and below 0.80 is getting Bullish. 1.00 = same amount of puts and calls. Over last two years the highest for PCR is @1.50 and lowest @0.60 - anything approach these levels shows change likely For more information on PCR LINK)  After three days of major put buying we have settled into two days of basically a neutral. Today’s PCR evaluation still = Neutral
  • Investors411 uses the PCR to measure the path of least resistance for HFT dominated stock market. HFT’s love leverage and if there are more puts then calls, there is simply a supply glut on one side that forces a move to the other. See above.

The McClellan Oscillator

  • (MO) rose to +52.51 (Rough estimates =-30 somewhat oversold, -60 oversold, -90 OMG oversold & +30 somewhat overbought, +60 overbought and +90 OMG overbought) MO is somewhat overbought and approaching overbought. Only 3 times in the last year+ has the MO got over +80  Each time after that the S&P fell at least 7%   = Bearish/Neutral

___________________

Reading The Tea Leaves

Short Term Outlook

days, week+

  • Our forecasting tool are  Bearish/Neutral (see above) - You rather enter oversold markets and exit overbought markets. Advantage to Bears.
  • If the PCR was below 0.80, the Bulls would rule. (See Current Positions below for more)

Longer Term Outlook

month, months

  • Repeat Same old mantraMay 20th forecast still stands. The May 20th summer forecast has come to pass and now we wait to see the Fed’s next move. Add to this Europe is a whole lot worse than previously thought back in May. For the Fed to act significantly – inject more liquidity - I’m afraid we need to see stocks do worse for that to happen.
  • We do have a technical series of higher highs and higher lows build on major indexes.

________________

Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)

  • Tea LeavesAny @200 point Dow rally should bring the MO to or above +80.  Ideally we like a lower PCR. However, this (a potential +200 point Dow rally today) could be a risk on trade to nibble at - GO SHORTUse a leveraged ETF like SDS or TZA or sell some long positions.
  • Monday was a risk on to go long. It worked.
  • If @+200 Dow points today – HTF will have pump this market higher and some technical levels will have fallen (higher highs). Institutions will get excited and buy, then HFT’s will dump it. CAUTIONThis is contrarian advice. Most analysts will see  a +200 point move on the Dow as bullish. Longer term it technically is.
  • Risk on = For those that can tolerate the risk you have a fair trading opportunity – GOING SHORT in this case -. It could be better, even much better, but the tea leaves put the odds in your favor
  • If Investor411 goes short or buys GLD you will see it first in the comments section of the blog.

Positions

NLYAnnaly Capital Mgt. Ultra high dividend stock –a @14% dividend

pot of gold

GLD – (Long Gold ETF) Bought at 167.05 - Sold 1/2 for 8% gain. GLD closed at 174.40. Gold is contrarian to stocks and More willing to buy tan sell right now into a stock rally.

Disclaimer I buy everything in the hypothetical Investors411 portfolio. If stock is mentioned and I own it you will know.

_______________

Long Term Outlook

(for US stocks only – not our economy)

NEUTRAL*

*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

  • Share/Save/Bookmark
September 15, 2011

Heroes (2)

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

An Endorsement

“The stunning lack of accountability for the greed and misdeeds that brought America to its gravest financial crisis since the Great Depression.”Frank Rich - New Yorker magazine - “Obama’s Original Sin”


The single most important and vocal person in the white house over the last three years who fought for this accountability is Elizabeth Warren. Phenomenal editorial Warren vs. The Banks

Warren is the ONLY candidate out there that this web site endorses for political office.


Another Hero

Dylan Ratigan

  • 10 years financial reporter/editor Bloomberg LP
  • 5 years with #1 financial network
  • Creator and host of CNBC’s “Fast Money.”
  • Co host “Closing Bell.”

He left that high paying job to fight for what he believes in – accountability. His new show is on MSNBC (4:00 to 5:00 EST)  Here’s a LINK to an August 9th on air Meltdown over the Meltdown.  The emotion is real, but its what he says that matters.

You have to love the title of his upcoming book – “Greedy Bastards.” Radio Free Dylan often carries some outstanding editorials like this one “Why No Handcuffs?” Some major points Dylan often hammer’s home and Investors411 shares.

  • The $600 trillion swaps market is still an unregulated, hidden in shadows exchange. – It is the Credit Default Swaps that Warren Buffett termed financial WMD’s. The reason so many investment institutions were vulnerable/over leveraged in 2008
  • How to you build a viable economic system when the backbone financial systems are hidden in the shadows and too big to fail?
  • His four solutions to fixing the system LINK - Another LINK

[For Heroes Part 1 see November 10th Investors411]

__________________

__________________

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!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Index Percentage Volume
Do up 1 to 2% up
NASDQ
up
S&P 500
up
Russell 2000
-

_______________

Market Analysis

Focus on TechnicalsFundamentalsHFT’s

Shorter Term Outlook.

day/days/week/week+

  • There simply is no other explanation to yesterday massive swings than HFT were having a field day juicing and then sucking up profits from stocks. No fundamental news out there merited a 340 point Dow rally from the low, then a 140 point fall into the close.
  • Europe played kick the can down the road over Greece defaulting on its loans. The real story is can European banks, which are up to their necks in Credit Default Swaps on Greece and other PIIGS, stay solvent.
  • Trend - Kicking the can down the road is mana from heaven for HFT who can use every news items to execute short squeezes, pump and dumps or catching institutional traders with losing long positions

Investors411 Technical Forecasting Tools.

  • The PCR fell  to 1.05 (Roughly - above 1.25 is getting Bullish and below 0.80 is getting Bearish. 1.00 = same amount of puts and calls)(last two years the highest for PCR is @1.50 and lowest @0.60 - anything approach these levels shows change likely For more information on PCR LINK)  We built a lot of Put positions over the last 3 days but it has been steadily decreasing. The  1.05 close yesterday is Neutral, but the inventory/backlog of Puts makes the callBullish/Neutral.
  • Investors411 uses the PCR to measure the path of least resistance for HFT dominated stock market. HFT’s love leverage and if there are more puts then calls, there is simply a supply glut on one side that forces a move to the other. See above.

The McClellan Oscillator

  • (MO) rose to +28.59 (Rough estimates =-30 somewhat oversold, -60 oversold, -90 OMG oversold)( +30 somewhat overbought, +60 overbought and +90 OMG overbought) Just one point away from mildly overbought. But still = Neutral

___________________

Reading The Tea Leaves

HFT pushed stocks 140 points higher than they closed at. What happened? – The algorithms HFT’s use all clicked in and recognized a rapid overbought position. If we had ended the day 140 points higher our MO would have been near +50 (many other indexes that measure oversold/overbought would have shown the same) They pumped the market higher and then dumped into the close and took their nano second and multi second trade profits.

HFT’s are going to pull your chain on any event/rumor as long as they exist - Get used to it - HFT’s are here to stay.

Today, we have bullish/Neutral PCR, and an almost somewhat oversold MO = Neutral. So we’re NEUTRAL right now with just a touch of bullish mixed in.

Translation - US Stocks have no major bias higher or lower. Just a wee bit of the bull. This doesn’t mean HFT’s can not do a mega roller coaster on stocks, especially if there is meaningful fundamentals.

Longer Term Outlook

month, months

  • Repeat Same old mantra - May 20th forecast still stands. The May 20th summer forecast has come to pass and now we wait to see the Fed’s next move. Add to this Europe is a whole lot worse than previously thought back in May. For the Fed to act significantly – inject more liquidity - I’m afraid we need to see stocks do worse for that to happen,

________________


Paul’s Corner

Fortes Fortuna Adjuvant - this can be translated as “fortune favors the strong.”

The title borrowed from Dave Steckler’s Blog last evening and we will look at the semis by using Relative Strength to determine the best semi.

Before we get into the semis here is a comment from Dave’s blog last evening which explained the jump in the market Wednesday:

The S&P 500 Index gained 1.35% and the Nasdaq Composite rose 1.60%.  The rally came on hopes for progress in resolving the Greek debt crisis.  Oil and precious metals prices fell and the U.S. dollar retreated from its recent gains. It’s always nice to see a 100+ point up day but keep in mind the Dow was up 280 points a half-hour before the close.

So while a few YSL 5 stocks had a great day, let’s not hold our breath too long hoping this is the start of the big long awaited rally.

Dave Stecklers Blog is always worth reading and his latest blog has  a great discussion on Relative Strength and how it’s used to research the market and in this issue he also looks at the semis.

Dave Stecklers Blog  LINK

As we found out several days ago, the semis are starting to draw attention. YSL 4 member SPRD appeared several times last week on the “Best of Woodard and Brown” screen on HGSI. The semi group index jumped to the top of the HGSI Industry Group sort on Monday Sept 12.

Industry Group Sort  LINK

There are 112 semis in the Semiconductor Industry Group which is too many to follow. I made up a user group of the top 10 stocks in the group,  the reason these were the first out of the “gate” so at the moment we can assume these are the stocks to follow.

AMD, ARMH, CAVM, LLTC, MXIM, MCHP, NVDA, SMTC, SPRD, TXN

To determine the strongest stocks within this group, we used the “Ian Slow” Relative Strength chart on HGSI. It measures the 6 month RS  with the most emphasis on the closet 3 months. Here is the RS chart of these 10 stocks based on the Wednesday close Sept 14.

Relative Strength Chart LINK

As you can see SPRD is top dog with ARMH and MXIM not far behind. Briefly looking at the charts, these three look ok. SPRD has had a nice run and will probably give us a few buy the dip opportunities.

Some of  you may be wondering why Dave and I are posting on Semis and Relative Strength at the same time. Do I read Dave’s blog for my ideas? No, but I will admit he has some brilliant discussion at times and worth ripping off. Dave and I both use HGSI for our research and of late HGSI has shown the semis are on the move. HGSI  has a valuable Relative Strength function that let’s you dig out what’s going on and we both see a change in the semis worth investigating.

But but but, Cramer just came out suggesting the semis, so why do “I” need HGSI? I just need to follow Cramer! Well that Mad Money man does have some interesting ideas and he surely follows the market and presents it in an interesting way. But do you have the time to sit down and watch each evening to catch the latest trend? Do you even get home at 6 PM in time to see each show?   Using HGSI each evening one can fully evaluate the market moves of the day, see what’s coming on or going away and come up with a list of stocks worth spending your kids inheritance on all in a matter of minutes. So with HGSI you get time management and great stock research.

If you didn’t see it here is a link to Cramer’s video on semis, it‘s quite good. See which semis he recommends.

Cramers semi video link: LINK

So do we jump into the semis?  Your guess is as good as mine, probably yes, but when considering the PIIGS problem across the pond?

The usual worthless disclaimer applies.  You buy any of these dogs and lose your house don’t whine to me, whine to Barr.

________________

Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)

Our forecasting tool are Neutral (see above) - You rather enter oversold markets and exit overbought markets.

Positions

NLY - Annaly Capital Mgt. Ultra high dividend stock –a @14% dividend

pot of gold

GLD – (Long Gold ETF) Bought at 167.05 - Sold 1/2 for 180.4 Current price 177.21. Stop/sell order on GLD at 167.05. Now looking to buy small dip in price.

DisclaimerI buy everything in the hypothetical Investors411 portfolio. If stock is mentioned and I own it you will know.

_______________

Long Term Outlook

(for US stocks only – not our economy)

NEUTRAL*

*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

  • Share/Save/Bookmark
Page: /2011/09/ : TestLink1 - TestLink2 - TestLink3