Investors 411 Blog

by Barr Jozwicki
October 31, 2011

What, Me Worry?

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

Who are the 99%


See more of the 99% at

http://wearethe99percent.tumblr.com/

Pass on this or your favorite photo


Tom Friedman’s editorial in the Sunday NYT has an excellent article on the crony, casino capitalism we are fighting against.

Some major points –

  • An under reported Citigroup Fraud “that made GS “look like boy scouts” – No one gets arrested while thousand of Occupy Wall St. protestors do.
  • A comparison to Taharir Square in Egypt’s quest for justice where the “game had been rigged by the Mubarak family and its crony capitalists.”
  • “Capitalism and free markets are the best engines for generating growth and relieving poverty — provided they are balanced with meaningful transparency, regulation and oversight. We lost that balance in the last decade. If we don’t get it back — and there is now a tidal wave of money resisting that — we will have another crisis.”

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Euro Zone Doubts

European Debt Crisis


Lots of news outlets over the weekend cast doubts over last weeks  Euro Bailout. Here’s one from NPR’s Jim Zarroli .

But the best (easiest to understand)  is this two minute animated explanation featured in the Guardian.

Click on animation photo for link to video

The impact of these editorials on stocks covered below.


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Raising Cain

Huffington Post headline this AM is about “flavor of the month” (leader through October) Herman Cain having accusations of “sexual harassment” If there is any validity to these charges Cain is toast.

Candidate Rick Perry, last quarter in financially out raised Cain 6 to 1 and even beat Romney.  Money buys elections and flavors last a month. Perry, last week picked up endorsement of Mr Flat Tax -Steve Forbes. If Perry can stop putting his foot in his mouth he would be a very strong candidate.

Mitt Romney took a spank from mega conservative columnist George Will on Romney’s flip flops

Perhaps, Obama’s biggest weakness was how would he answer the 3AM phone call?  He did with Somali Pirate’s, Bin Laden, His #3, and Ka Daffy. Do we want an indecisive flip flopper answering that 3AM call?

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STOCKS


“Deja Vu, All Over Again”???

Yankee Star Yogi Berra

On July 21 st markets rallied on the news of a Euro Bailout Plan – Greek bond holders took a 21% cut , etc. The chart of the benchmark S&P 500 shows a significant rally in above average volume on the 21st. We held onto or confirmed those gains the next day just like last week and the second major Euro bailout plan.

After a weekend investors started to doubt the rescue plan and by Aug. 8th the S&P 500 was down almost 20%.   The question is – are the current doubts strong enough to have the same impact on the investment herd? (see above links and link below)

Click on photo for link

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Reading The Tea Leaves

  • Our secondary indicator, the Put Call Ratio is at 1.00. Well below its 50DMA which is at 1.15 = Bullish/Neutral
  • For more on MO & PCR see POSITION Section of blog (scroll down)

alfred_e_neuman.jpg


Technical analysis is all about reading tea leaves, trends, patterns and history/chart patterns repeating themselves. Yes, there is cause for worry. But the bulls have some valid fundamentals on their side too.

  • Strong above average 2.5% GDP results or last quarter in USA.
  • China’s growth numbers has its critics, but again its GDP was over 9% again.
  • Consumer sentiment is down, but consumers are spending more in USA.  Due to top 10% (income) on buying spree and the bottom 90% very worried.

Bottom LineToo hard to make a definitive call on this situation because the manipulators (Central Banks) & shadow banks are hidden in opaque accounting.

However , if you use some inter market technical analysis, the kind John Murphy creates, you’ll see some clear hesitation across currency, bond and commodity markets. (What all this means in tomorrows Investors411)

Same long term outlook till/if we break down below 1225 on SPX.


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Long Term Outlook

3 to 6+ months

Investors411 upgraded its Outlook last Monday to CAUTIOUSLY BULLISH. Reasoning

  • Technically, we broke out of this summers trading pattern. The resistance and now support level for benchmark S&P 500 is @ 1225.
  • Fundamentally, the perception that European banks will survive (see Banksta at War) another over leveraged crisis
  • A 2.5% GDP Growth in the third quarter is NOT a recession number.

CAUTIOUSLY BULLISH

Investors411 has 5 different 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

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.


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October 28, 2011

Boycott BOA

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

Fighting Crony Capitalism


Take the crony out of CapitalismNYT’s Nicholas Kristof’s excellent defense of Occupy Wall Street


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Boycott BOA

10 Reasons NOT to Bank with the mother of all Bankstas

Bank of America.

From Nomi Prins at Truthout. Of all the ways  (hidden fees, lawsuits, nailing vets, over charges, pay’s no taxes) BOA charges vs other local banks I find reason # 6 the most compelling. They use your deposit to gamble hidden over leveraged derivatives.

“The total amount of derivatives in the FDIC-insured portion of B of A as of mid-year was $53.7 trillion, up 10 percent from $48.9 trillion the prior year, and up nearly 35 percent from its pre-fall [2008] crisis level of $40 trillion.”

Your over leveraged FDIC insured deposits at BOA  multiplied the severity of the 2008 housing/financial crisis. Who knows how deep BOA and other banksters (shadow banks) were into the European sovereign debt crisis? – Our Fed is not audited, US banks don’t have mark to market accounting, and the whole 500 trillion derivitives market hides its trades.


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Bankstas Take A Hit In Europe


Yes, over leveraged European financials did get a $1.4 trillion bailout fund. But they were also forced to take a “50% haircut”on the Greek bonds the held. How much of this haircut that will come out of their bottom line is open for debate. (See links in yesterday’s blog)

Bankers and Bankstas - There are normal Bankers who take our deposits and use them as collateral for loans that help people and small businesses. The good guys.

Bankstas take our FDIC insured deposits and use them  as protection to play casino capitalism, on bundles of mortgages, sovereign debt, student loans etc., called derivatives  or Credit Default Swaps.

This over leveraging is done in hidden transaction in an opaque $500 trillion derivatives market. The biggest poorly regulated bankstas are now too big to fail – Example BOA.


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STOCKS

From Yesterday - Today’s move higher should be Dramatic Not Erratic. US stock indexes saw a significant move higher (3.18% to 5.26%) in big volume , but European stocks saw an even bigger move. ETF’s that track France and Germany up 8+% (see positions below)

A better than expected 2.5% US GDP for the last 1/4 is another solid fundamental for bulls.
A contrarian view to Investors411 – Time to Fade the Rally

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Reading Tea Leaves


  • Our secondary indicator, the Put Call Ratio is at 0.91. Well below its 50DMA which is at 1.15 = Bullish
  • For more on MO & PCR see POSITION Section of blog (scroll down)

Stock traders/investors put their money down yesterday -  The proposed solution in Europe looks like it will have a somewhat similar impact on stocks that the  of 2009/2010 Obama/Bernanke bailouts did. In fact, traders/investors have been putting their money down since the lows almost a month ago.

It is rational to expect some kind of pull back today. But, there are lots on the sidelines who have missed out on the move looking to buy the dip. Volume was big yesterday, but not yet the huge kind of volume associated with a climax selloff.

Unfortunately, the bigger part of this move off the bottom is probably over, but it looks like we may be able to reach this year’s highs again.


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Positions


SPY(ETF tracks S&P 500 or SPX) bought at 123.5, now at 128.63

Reminder – Your Stock List#5 – . 5 of our 14 stocks took  some big earnings hits (one on an analysts downgrade) So Paul & I have decided to drop TSU, RES, CROX, GMCR, & CPHD. . LINK to entire list (scroll down)

Under consideration.

SSO (ETF that is @2X SPX) Buy on dip. Investors411 uses a buy the dip strategy in markets that are trending higher.

EWG (ETF that tracks Germany) and/or EWQ (ETF that tracks France) Both are higher risk because they are on the cutting edge of what’s happening. A bigger technical breakout than US indexes. Yesterdays melt up was fundamentally focused on the fact that specifically German and French financial institution would weather the default crisis.

I favor Germany – better overall economic fundamentals. Buy the dip.

XLF (ETF for financial stocks) For those that can handle more risk UYG (2X financials) & FAS (3x financials) Several Investors411 bloggers have made out handsomely with gains of 50+% trading January Calls on FAS.

Mea CulpaAll of the above new considerations should have been listed Monday after the Upgrade.

Note – These are official Investors411 Positions – I buy each position mentioned.


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Long Term Outlook

3 to 6+ months

Investors411 upgraded its Outlook on Monday to CAUTIOUSLY BULLISH. Reasoning

  • Technically, we broke out of this summers trading pattern. The resistance and now support level for benchmark S&P 500 is @ 1225.
  • Fundamentally, the perception that European banks will survive (see Banksta at War) another over leveraged crisis
  • A 2.5% GDP Growth in the third quarter is NOT a recession number.

CAUTIOUSLY BULLISH


Investors411 has 5 different 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

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.

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October 27, 2011

Springtime Then Reality?

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

Springtime For Europe Then Reality?


We have another major solution to the Eurozone Crisis. German stock market up 4.84% at 8:20 EST and climbing.  So favorable reviews from Germany should transfer across other stock markets . Globalization at work. NYT’s #1 story today. Two biggest points.

  • Greek’s default grows from 21% to 50% on bonds
  • A $1.4 trillion bailout package to protect banks from  bad debt of all the debtor countries in Europe.

Zero Hedge (libertarian view) negatively dissects some of the details. - A Farce, & Springtime For Europe then Reality - Citigroup’s conclusion, does a good job at outlining what happened and next steps.


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The Lobbyists Dream Candidate


The lobbyists in Washington have chosen their Dream candidate - Mitt Romney

  • He’s raised more lobbyist money than all the other Republican candidates put together
  • 6 times the amount Obama raised from Wall Street

Mitt just had another Washington lobbyist fund raiser in DC and the invite list included the “Dozen” Biggest of K Street  lobbyists who run our government. Link and Link and LINK

Obama was the last presidential candidate that K Street showered  a just bit more $ on than the challenger  and the negative results are evident. This time around its not even close.



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STOCKS





From Yesterday - Europe … If gains are allowed to be privatized by financial companies  and the risk socialized by the people the financial stocks involved will push stocks higher in the shorter term. It will be more poverty for the middle classes who will pay the bill… My read of the Tea Leaves is stock will keep erratically moving higher.

Today’s move higher should be Dramatic
Not Erratic
  • Over three weeks ago Investors411 stated for those that could handle the risk a RISK ON Trade off the market low was probable.
  • Monday The Long Term Outlook was changed to CAUTIOUSLY BULLISH
  • The major fundamental reasoning behind the rally was discussed this week and is summarized in brown above.

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Reading Tea Leaves


  • Our secondary indicator, the Put Call Ratio is at 1.01 = Neutral.

  • The PCR is telling us that the professionals who use the Puts and Calls are Neutral. However, since the 50DMA of the PCP is not at 1.00, but much higher at 1.17 Sentiment = Moderately Bullish

As stated before the events in Europe trump this like they did after the 2008 meltdown.

Then, the MO fluctuated between +110 to +20 for two months. At that time there was the start of a set of solutions led by our Fed and Treasury that lite a fire under stocks for two years.

The MO should reach OMG overbought levels today (over +80). This may slow down the stampede and create some dips to buy.

  • Now, it seems like the perception of investors is that  the proposed solution in Europe will do something similar tot he stimulus of 2009
  • Stocks, especially financials should do better, but just like 2008 people/taxpayers will suffer in Western Democracies.
  • The 25% of global growth this year that comes from China(Time magazine) is critical to bullish trend developing.

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Paul’s Corner

3 Days of Ian Woodward

This past weekend I had the great pleasure of attending the fall HGSI Workshop in Palos Verdes Ca. The workshop featured lecture by Ian Woodward and Ron Brown from HGSI. Let me give you a few of the details.

Ok ok, I can hear the moaning, “Oh no here comes more Ian Woodward and HGSI talk”. Please folks humor me, read on!

Ian and Ron’s discussion lasted for three days. Interspersed throughout the weekend there were several guest speakers who added to the value of the workshop.

Ian showed us his research behind HGSI investing and Ron gave live market demonstrations how to maximize using HGSI.  This meeting really helped us understand the undercurrent of the market. Ron and Ian showed us how to get insight using HGSI and related tools in a predictive manner.

Fred Richards – an HGSI contributor, Harvard Economics Professor and longtime expert investor gave us a great overview of the world economic stage and what to expect going forward.  Fred is a great CANSLIM type investor with decades of experience and great stories. A friend of his when growing up was William O’Neil of Investor’s Business Daily.   It was wonderful hearing Fred and by good fortune I sat next to Fred at dinner Saturday evening. Ian bought dinner for all at a wonderful Mexican restaurant

LINK

Chris White demonstrated his new software EdgeRater 5.0.   Chris demonstrated how using HGSI, one can do an end of day update across the market of index, ETFs and Stocks in just a few key strokes.  Perhaps the greatest benefit of using EdgeRater with HGSI is EdgeRater takes many of the tools developed by Ian and Ron and automates them in EdgeRater giving us a predictive look into the markets.

LINK

Chris Wilson an HGSI user demonstrated his techniques for Pairs trading.  Using HGSI and a non-proprietary set of tools using HGSI, Chris broke new ground with a technique based upon the changes in RS over time between an equity and a comparative index or ETF.

Dr. Jeffrey Scott, an HGSI user, presented stocks for consideration of our next JIRM index, our early warning indicator of a failing market.  For background, check out Ian’s blog, posted on the HGSI website: Stock Market: Doom and Gloom or Plain Sailing? September 25th, 2011.This exercise gave us early insight we are clearly seeing rotation into unusual leaders such as SBUX, KMB and MCD. This rotation reflects the current fear in the marketplace.  This was an excellent lesson in chart reading and fundamental analysis. We ended up selecting 19 high quality leaders in this exercise. Only attendees have this list and if you wish to see it you have to attend a work shop.

LINK

For me the highlight of the workshop was a brief lecture by Gil Morales (author of Trade Like an O’Neill Disciple) to review his tidea on current market conditions and update us on pocket pivots.  Gil was supposed to give an hour discussion but it soon turned into 2 ½ hour lesson of correctly shorting a stock. Gil also painted a concerned picture on the market and gave us some names to consider shorting.  Gil was an analyst for Investors Business Daily. He uses HGSI to scan for pocket pivots. A pocket pivot signal gives a very early signal that a stock is getting ready to break out. I have studied the signals for months now and they do appear to be a very good early indicator.

LINK

My wife joined me on this trip and we took some time touring Pasadena, Hollywood, Beverly Hills and Bellaire. She really enjoyed buying clothes! I was a great weekend.

We all like to talk about our best stock trade. The investment I made this past weekend with respect to time, air fare, hotel, Seminar cost has to be the best stock investment I have ever made. It was an outstanding weekend.

If any of you are serious about developing your trading skills, Ian’s next workshop is scheduled for March 24-26. I encourage you to join us.


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Positions


SPY – (ETF tracks S&P 500 or SPX) bought at 122.5 (See Monday’s blog for details)

Your Stock List#5 - Mea CulpaHolding stocks through earnings season is always dangerous. 5 of our 14 stocks took  some big earnings hits (one on an analysts downgrade) So Paul & I have decided to drop TSU, RES, CROX, GMCR, & CPHD. Their positions will be closed at end of day. LINK to entire list (scroll down)

Future considerations – SSO (ETF that is @2X SPX) Buy on dip. Investors411 uses a buy the dip strategy in markets that are trending higher.

Bottom Line - It looks like a trend is starting. This is a significant bailout in Europe. There will probably be more. Little discussed China is the key to global growth and this trend developing.  The greatest risk is at the start of a trend, but also the biggest reward. Obviously the trend is NOT solidly in place.


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Long Term Outlook

3 to 6+ months


CAUTIOUSLY BULLISH

Investors411 has 5 different 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

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.

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October 26, 2011

We are the 99%

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

We are the 99%


Police in Oakland,  broke up the Occupy Oakland Protest.  Police used “flash grenades,”  ”tear gas.”& “riot police.” Officials used the same excuses and methods other officials to break protestors  in Egypt, and other Arab Spring countries that were fighting for jobs and democracy. Exception – There were no deaths

Photos of the incident and, are on front pages throughout the world. Just like in the Arab Spring.

Links/Photos/VideosAl JazeeraBritain, Huffington Post, Woman in wheelchair tear gassed


Here’s What We Are Fighting For


One of the 1000+ photos at wearethe99%.tumblr.com



And Another



And Another

*****

Chart of the Day
From Talking Points Memo

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Stocks

Overbought stocks fell dramatically on European fears and bad consumer confidence numbers. Tech leader AMZN missed earnings expectations badly (down 15% in post market trading) and European stocks are flat (7:00) AM EST.
The biggest problem in Europe is Italy (The #3 economy in the Euro zone – see yesterday’s  NYT chart) A deal?
  • #1 forecasting tool, the MO fell dramatically to 44.61 Moderately overbought = Neutral/Bearish
  • Our secondary forecasting tool the PCR rose slightly to 1.04 = Neutral
  • See Strategy section for more on MO & PCP

Reading Tea Leaves


Same as yesterday - Right now the news out of Europe trumps everything – Their financial Stocks move higher = so does everything else. Pro’s are bullish (PCR) takes some of the sting off how overbought we are (MO).

The major editorial yesterday said it all. Conclusion –  Europe is the same as the USA in 2008. If gains are allowed to be privatized by financial companies  and the risk socialized by the people the financial stocks involved will push stocks higher in the shorter term.  It will be more poverty for the middle classes who will pay the bill.

My read of the Tea Leaves is stock will keep erratically moving higher. If we close below 1225 support level on S&P 500, Long term Outlook will change back to NEUTRAL.

Our financial system desperately need  regulation, regulators,accountability & transparency. But few care about long tem solutions.

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Detective

Demystifying and Discussing

Simple Option Strategies

By JS


LEAPS

Today I’ll discuss investing in LEAPS ( Long Term AnticPation Securities).  Leaps are longer term options, for up to 2 years or more.  Today, you can by LEAPS that expire up to January, 2014.

Why buy out that long? Because it gives you a longer time to have your investment work. Many times my calls expire before the stock moves enough for my investment to pay off. I’ll watch my call expire worthless and then see 2 or 3 months later, (or a year later)  I made the right call but the wrong timing.

Example:  On June 20, this year, CSCO was $15.01.  It had reached a pretty good low. I’ve followed it since the mid ’90′s and felt it was way too low; they had lots of cash, little debt, and products that were necessary for the internet, especially with the cloud becoming bigger.

However, this market was very unstable at that time (even now). I could have bought 100 shares for $1500, but I wanted a bigger return, so I bought  LEAPS:  -CSCO130119C17.5, costing $1.33 per share or $133 per contract. I was able to purchase 10 contracts ( or 1000 shares) for $1330.

Today the result of this trade:

  • Buy 100 shares :   $1501:    price today:   $17.50, or $1750,  a profit of $250 or 17%.
  • Buy 10 contracts:  $1330:    price today:      $2.54, or $ 2540, a profit of $1210 or 90%

This option is still alive till Jan, 2013. My question (to me) is: is 90% enough or should I take my profit and run. In this market, I think I’ll take 1/2. If I had purchase shorter term options, one to 3 months out, I would have lost all or most of my investment. Also, the reason the price of this option was so low was that CSCO is not on many buy lists.

Note: this column is based on closing prices of Monday, Oct 24.

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Long Term Outlook

3 to 6+ months

CAUTIOUSLY BULLISH*


*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

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.


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October 25, 2011

Banksta At War

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

Bankstas At War

European Theatre


Just like the 2008 mortgage debt crisis we have a sovereign debt crisis in Europe. The major question is who is going to end up paying the bill? Will risk be again privatized by banksta’s with their politicians and socialized by the people?

The Big Picture – One reason why the NYT is the world’s most respected newspaper is they come up with outstanding charts and information “A Spectators Guide to the Euro Crisis”

800 LBS Gorilla – Hidden Derivatives Market

The NYT chart shows what happening on the surface. The real picture is full of smoke and mirrors because, just like the 2008 meltdown, the 800 pound gorilla in the room is the opaque, unregulated, derivatives market. Remember – Warren Buffets calls CDS’s (derivatives) “Financial WMD’s.”

Quite simply, once again, who knows what the exposure any major financial company is?  Remember – how interconnected  AIG was? MIT Economist Simon Johnson does.

Do they make a calculator big enough to measure the profits that banksta’s made off the European countries with debt problems in the opaque $500 trillion derivatives market?

Whose going to pay? The too big to fail interconnected (both globally and politically) banksta’s, the bond holders, or the people. The prevailing powers in Europe are now suggesting a 50% haircut for bond holders of Greek debt. (the most pressing problem country)

The austerity measures (raise taxes, fire workers, sell national treasures) imposed on Greece, already with 18% unemployment, would put the country into a long depression and benefit the financial elite who will pickoff Greek assets at fire sale prices. Bankstas war against people by Economist Mark Hudson quantifies this.

We have a broken globalized financial system that benefits a few at the expense of many. Banking used to promote growth, not make hidden bets (CDS’s) on repackaged debt. Profits gets privatized and risk gets socialized.

*******

Two groups with very different solutions passionately recognize privatizing the gains and socializing the risk is tearing down the financial stability of western democracies.

Poverty creating casino capitalism is being fought by both Libertarians (Ron Paul) and the Occupy Wall Street believers. (the 99%)

______________________


STOCKS

Why the Rally – The perception by major market movers that in Europe the gains is being privatized and the risk socialize. Best measurement of this would be German financial companies- Thought to have largest exposure to European debt. Second best German stock market – Up 1.5% at 8:15 this AM.

  • Our #1 forecasting tool MO rose to 91.33. OMG overbought levels. The highest in 3 years. = BEARISH
  • Our #2 the PCR rose to 0.96. Shows pro’s who trade Puts and Calls are not very worried = Bullish
  • See Strategy section of blog for more on MO & PCR

Reading Tea Leaves

Same as yesterday – Right now the news out of Germany trumps everything – Their financials move higher and so does everything else. Pro’s are bullish (PCR) takes some of the sting off how overbought we are (MO).

Traders - rallies in the AM, should be met by selling in the PM.  Because  like the MO and virtually every oversold/overbought indicator like it is so high.

Investors – Technically we have broken out of this summers trading range – That’s bullish and the long Term Outlook is now CAUTIOUSLY BULLISH. More often than not we retest breakout levels. However, Investors411 is nibbling on the SPX. (Any ETF that tracks this will do) It was chosen because it tracks the S&P 500 and is relatively safe.

JS suggests the SSO and The Critic suggests FAS (although she has a Put/Call play on this.)  Both are good but involve more risk.

Paul tells us there is great risk out there – he’s right. Paul is at a HGSI stock seminar in CA this week.

Bottom Line - The only other time the MO was so high and did NOT see at least a 5% fall in stock prices within a week or two was back in 2009.  Right now the insiders seem to be seeing the same dynamic happening. -

Privatizing Gains and socializing risk works for short term gains – but in the end if you keep putting more and more people in poverty at the expense of a wealthy few the end result is revolution

______________________________


Long Term Outlook

3 to 6+ months

CAUTIOUSLY BULLISH*

*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

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.

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October 24, 2011

Stocks

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


Stocks


Friday, Saw a major short covering rally in US equities. The move off the summer lows has been led by financials (ETF = XLF) Up almost 20%.

The major issue in the short term is who is going to finance sovereign debt of Greece and other European countries.

The German banks are the largest holders of European debt. The Greek situation is crisis #1. Today

  • At 8:00AM EST  German stocks up +3.55%
  • Earlier this AM Greek stocks down -4.6%

This data trumps others and says the rally will continue even though our McCellan Ossillator is at overbought levels 69.87

______________________

The Long Term Outlook has been upgraded to CAUTIOUSLY BULLISH because of a technical breakout in the trading pattern and what is perceived to be a victory for bankstas in Europe. (more explanation tomorrow)

Investors411 has a position bought Friday – SPY (S&P 500 tracking ETF) at 123.5 (see comments section of blog)

Traders – Shadow banks and financials look like they will continue to rally, but are very risky

______________________


Long Term Outlook

3 to 6+ months

CAUTIOUSLY BULLISH*

*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

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.





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October 20, 2011

Getting Fleeced

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

Getting Fleeced


Life is Good if you are a Banksta.


Banks are critical to the growth of any economic system.  But if you decimate the regulations and regulators who watch over the financial system then greed runs wild.

Today too big to fail banks with infusions of trillions of dollars from governments/taxpayers continue to threaten worldwide economic systems while still  torturing taxpayers and consumers.

Here’s just the latest -

  • No one goes to jail.  Our understaffed SEC (many scream cut government/cut regulators/cut regulations/cut SEC) who has often been accused of being in bed with bankstas (read Matt Taibbi) just settled with Citibank who was telling clients one thing and defrauding them by doing another.
  • Everyone from US Military Commanders to Apple Computer are held accountable for their actions. Bankstas are special.  They don’t have to mark to market their earnings results.
  • Goldman Sachs earnings (even without mark to market accounting) report is worse than expected and has a revenue LOSS – next day goes up +6%. Apple, who has to use mark to market accounting has a worse than expected earnings report and goes down -6%
  • No one will go to Jail – Price fixing scandal grows as major banks (BAC, C, JPM, DB) are accused of Price Fixing
  • Noted Economist, Prof Mark Hudson explains how European Debt Crisis is “Bankstas waging war against the people of the world”

The 1% at the top benefit enormously from banks. They reap they huge bonuses & salaries, they trade the unregulated Credit Default Swaps, and they run and invest in High Frequency Trades.

Damn it feels good to privatize those gains, socialize the losses and not be held accountable.

What do we sheep do?

(except the Occupy Wall Street protestors)

BAC and other banks save enormously when you use your debit card instead of a check. Now they charge a $5 monthly debt card fee. Again and again and again and again….


We sheep passively get fleeced.


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Stocks

egg splat crack smash broken

Another broken eggs meltdown day. NASDQ and Russell 2000 get clobbered. Dow and S&P spanked. Europe and earnings results to blame. Seeking Alpha’s “must know” stock news for today.

Some Important Points

High Frequency Traders are volumizers. They don’t have a basic fundamental bullish or bearish bias in their algorithms. They pump up the volume and therefore make price moves more distorted.  Technically, many of the algos they use do become more bullish when markets are oversold and bearish when they are overbought.

Fundamentals (example earnings) and Manipulators (example – Central Bank intervention) move markets. Technicals offer guidelines on how those markets will move. (example overbought = bearish, oversold = bullish)

Technical Forecasting Tools

  • Our primary technical forecasting tool, the McCellan Oscillator fell dramatically from 67 to 34.04. Moderately overbought = NEUTRAL/Bearish
  • Our secondary forecasting tool, the Put Call Ratio, fell to 1.12 = NEUTRAL
  • For more on these two indexes click on STRATEGY section on top of page.

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Reading Tea Leaves

  • Our technical bias (MO &PCR), in the short term, is moderately bearish. – Translation – If all the fundamental news was neutral, the market would probably go down

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Paul’s Corner

Wednesday started out on a positive note, then in the afternoon a Fed Beige Book report wasn’t well received and news out of the Euro War Zone turned negative about 2PM and down went the market. Until Greece settles it looks like an unsafe market.

GMCR has sure been getting tossed out like a bad brew these past few days. The trouble started after a David Einhorn presentation. He specializes in short sales.

Read his report.

Even with Wednesday’s soft action on the tech stocks many are starting to show life.  Here are a few to look at:

ATML Atmel Corporation designs, develops, manufactures, and markets a range of semiconductor integrated circuit (IC) products. The company’s Microcontrollers segment offers various proprietary and standard microcontrollers, such as embedded nonvolatile memory, integrated analog peripherals, and capacitive touch controllers

BSFT BroadSoft, Inc. provides software that enables fixed-line, mobile, and cable service providers to deliver voice and multimedia services over Internet protocol (IP) based networks.

IACI IAC/InterActiveCorp engages in the Internet business in the United States and internationally. The company operates in four segments: Search, Match, ServiceMagic, and Media and Other. The Search segment develops, markets, and distributes various downloadable toolbars; provide search, reference, and content services through its destination search and other Websites, including Ask.com and Dictionary.com; and aggregates

KLAC KLA-Tencor Corporation designs, manufactures, and markets process control and yield management solutions for the semiconductor and related nanoelectronics industries

RAX Rackspace Hosting, Inc. operates in the hosting and cloud computing industry. It provides information technology (IT) as a service, managing Web-based IT systems for small and medium-sized businesses, as well as large enterprises worldwide.

RNOW Rightnow Technologies, Inc. provides cloud-based customer experience software products and services.

SIMO Silicon Motion Technology Corporation, a fabless semiconductor company, designs, develops, and supplies a portfolio of multimedia data processing, storage, and transfer solutions primarily for consumer electronics applications

SPRD Spreadtrum Communications, Inc., through its subsidiaries, operates as a fabless semiconductor company that designs, develops, and markets baseband processor and RF transceiver solutions for wireless communications and mobile television markets. SPRD is a Chinese company.

Stocks listed are for education only. No buy sell recommendations are made or inferred.


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Investors411 LONG Term Investments

Each day Paul (change setting from profile to activity) offers up to the minute commentary on the markets & YSL #5 in the Comment section of the blog. Catch his Paul’s Corner every Tuesday and Thursday.

Our Hedge Investment - Theory – Technology will do better than financial sector over time. Thus hedge is set to hopefully work well in both up and down markets.

  • Short Financials – Investors411 will use ultra short SKF (opened at 78.91 – sold at 71.51).
  • Long Technology - Investors411 will use ultra long QQQ (tech’s) QLD (opened at 81.13 – sold at 87.48)
  • The last half of this trade was sold or less than a -1% loss = Total lost /gained of entire trade = 0%
  • Why it was sold – See editorial above. Financials have a major advantage NOT using mark to market accounting and continued support from central banks. No trend was developing in this trade.

Taking it on the Chin.

After four very successful YOUR Stock List, the 14 stocks in YSL #5 is taking it on the chin.  The reasons

  • Two days ago CROX had a bad earnings report and fell -39%
  • Yesterday GRMC suffered from a poor forecast by a major analyst and fell -13%

___________________


Long Term Outlook

3 to 6+ months

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

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.

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October 19, 2011

Taking a Break

Author: Barr Jozwicki - Categories: Market Update

Taking A Break

[Three points below]

  • Investors411 has  a Hedge position that we are closing down. 1/2 was already sold for 0% gain and the second half will be sold at a loss today. See past blog posts and more. tomorrow
  • Yesterday stocks melted up and if they can improve moderately on gains the Long Term Outlook will change to CAUTIOUSLY BULLISH
  • Even Fargo ND had 300 Occupy Wall St protestors over weekend (see comment section of blog) Photos of Occupy Boston which I personally attended can be seen here

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October 18, 2011

Income Inequality

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

Income Inequality


(sorry see Link below for chart)

The chart shows the growing gap between the top 1% (pink color) and the other 99% between 1917 and 2008 in the USA.

Chart from Henry Bloget at Business Insider also points out the significant rise of the wealth gap between 1981 and 2008 of the 1% vs. the 99%. Original data from Pro. E Saez UC Berkeley.

Kudos to Paul for turning us on to Business Insider.

Too see all the full sized charts - LINK

Download the charts, Post them on Facebook, send them to your friends, and/or drop some off at your local “Occupy ——” protest site.

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Stocks


egg splat crack smash broken

What was hopefully supposed to be a confirmation day (= prices hold on to most of their gains from previous day) of a major breakout turned into a meltdown of broken eggs.

China’s GDP numbers last night – Headline – 9.1% Down from 9.5% and less than expected 9.3% Heng Seng (China’s stock market) down -4.3%

Bunches of earnings reports. IBM fell after its report yesterday and Goldman’s reports a HUGE loss.

  • Our primary forecasting tool, the McCellan Oscillator fell dramatically to +37.84 (moderately overbought = NEUTRAL/Bearish
  • Our secondary forecasting tool, the Put Call Ratio, rose to 1.18 = NEUTRAL
  • For more on these two indexes click on STRATEGY section on top of page.

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Reading Tea Leaves


Mea Culpa - I was far less aggressive with my Short the market call than I should have been yesterday. “Because of the OMG MO – Short term traders may be successful in shorting rallies.” but I also stated “there is no clear buy of sell signal”

For longer term Investors - There is no buy or sell signal unless we had a confirmation day. Yesterday was supposed to be that confirmation of a price breakout from its trading range. It got crushed. Therefore no upgrade to CAUTIOUSLY BULLISH and no clear buy or sell signal.

For short term traders - Again my bad the MO has worked - “Over the last 3 years the MO at OMG levels has always meant at least a 5% decline over the next week to month.” This should have been a RISK ON trade yesterday instead of “Because of the OMG MO – Short term traders may be successful in shorting rallies.”

Today – Reading Tea Leaves - Expect at least a 5% decline from highs.

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Paul’s Corner

It’s 7:30 AM Tuesday and Barr is waiting for my email with today’s words of wisdom from Paul’s Corner. Let’s see what should I write? The dollar is up, more news from Europe, markets sold off yesterday, China’s GDP fell for the third straight quarter, ain’t nothing new here folks, same old stuff we have seen for the past few months and the market hasn’t changed, so do we really need a new Paul’s corner for today? Maybe I’ll just copy and paste last week’s edition, things haven’t changed.

Ok since I’m being lazy here what does Dave Steckler have to say? From his blog last evening:

Well, it was nice while it lasted. Last week’s action sent the equity indexes up 5% or so but today the Dow Industrials fell almost 247 points to close at 11,397.68. Volume was below average.  The S&P 500 Index dropped 1.94% and the Nasdaq Composite shed 1.98%.

Germany shooting down hopes for a quick fix to Europe’s debt crisis was blamed for the sell-off today but as we’ll see, the charts show it was not unexpected.  Oil and gold/silver prices all fell but Treasuries gained strength as prices rose and yields fell.  The U.S. Dollar rose.

Read  Dave’s full blog, Link

Well Dave that sounds like last week’s blog and the previous weeks blog, so hum, it sounds like we are  stuck in this nasty sideways trading range.

How about Ron Brown’s morning report?

At this point, it is a one day pullback on light volume.  The shift to the downside was dramatic for the Force Indexes and the % shift down for the small caps.  The VXX shot up over 10% which shows just how nervous this market is.

The NASDAQ fell back into the trading range and gave up 2%.  I’ll be watching tomorrow to see if this was just a slight pullback, or if the market fall back further into the trading range.  If selling continues on heavier volume, that will be a signal that the market is probably heading lower.

Gee whiz same here, just more of the same stuff we have seen for months now. But wait, notice both Dave and Ron suggested light volume on yesterday’s sell off,  this is good. Just maybe the market has reached equilibrium. Just  maybe.

I can’t add much to what the masters of market analysis have said other than I did order a hamburger with out cheese at the local diner last evening and it came as ordered, no cheese! So just maybe this market is finally getting ready  to go. If you care to play, be careful with your capital, your grandchildren are counting on you for not screwing up with their inheritance.

__________________


Investors411 LONG Term Investments


Each day Paul (change setting from profile to activity) offers up to the minute commentary on the markets & YSL #5 in the Comment section of the blog. Catch his Paul’s Corner every Tuesday and Thursday.

Our Hedge Investment - Theory – Technology will do better than financial sector over time. Thus hedge is set to hopefully work well in both up and down markets.

  • Short Financials – Investors411 will use ultra short SKF (opened at 78.91 – now at 76.51).
  • Long Technology - Investors411 will use ultra long QQQ (tech’s) QLD (opened at 81.13 – now at 86.55)
  • @ a 2+ % gain on this trade so far

___________________


Long Term Outlook

3 to 6+ months

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

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.

  • Share/Save/Bookmark
October 17, 2011

Going Global

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

Going Global


The Occupy Wall Street Movement has exploded globally to about 1405 locations worldwide. [OccupyTogether.net]

I did have the pleasure of spending time both Saturday and Sunday at Occupy Boston. From the street workshops I attended – a universal theme of jobs, fair taxes and financial oversight were the major themes.

Some major points.

  • Top 1% of Americans combined posses more wealth than the bottom 90%
  • 400 wealthiest Americans have a greater accumulated wealth than the bottom 150 million Americans
  • Between 2002 and 2007, 65% of all economic gains went to the richest 1%

None of the workshops or discussions I had preached hatred of the rich, only that we needed a more balanced approach. Since the weathies 1% are making almost all the gains, 73% of Americans (Time magazine poll) favor raising taxes on the rich to help balance the budget.

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The Candidate Of Wall Street

Last election cycle Obama was the candidate who raised the most $$$ for Wall Street. This election cycle the NYT (Sunday lead story) reveled Mitt Romney as the candidate of Wall Street.

Show me the Benjamins

  • Romney –  $1,500,000
  • Obama - $270,000

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Britain’s Misery

Timing is everything.

On Sept. 19th Investors411 showed what happened to Japan when they enacted budget cuts = Drop in GDP.

The lead editorial in Saturday’s NYT shows the self inflicted misery in Britian when you cut the budget during difficult economic times, instead of  letting growth return first.

  • “Britiain’s economy has barely grown since budget cuts were enacted last year.”
  • “Highest jobless rate in 15 years.”
  • “GDP growth last 1/4 = 0.01%”
  • “Cut of public sector jobs…has failed to revive business confidence.”

Britain is now instituting QE (quantitative easing) programs of its own to stimulate the economy.  A move fiercely opposed by right wing politicians in the USA.

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Stocks

Google’s earnings report (season now in full swing) led markets higher Friday.  AAPL, AMZN & IBM are the 4 horsemen breaking out to leading tech and equities higher.

From England – why global market’s will rally This is the global consensus  and an excellent explanation of why Bulls have control and we have “started the seasonal rally”

Major European Summit meeting on Sunday 23 rd.  Looks like officials have found a way to privatize the risk and socialize the debt. Just like they what’s happening in the USA.

  • Our #1 forecasting tool, the McCellan Oscillator rose to 80.23 or OMG overbought levels = BEARISH
  • Our #2 forecasting tool, the Put Call Ratiodropped  to 0.99NEUTRAL
  • For more on these two indexes click on STRATEGY section on top of page.

____________________


Reading Tea Leaves

  • Over the last 3 years the MO at OMG levels has always meant at least a 5% decline over the next week to month.
  • The ONLY time this did NOT occur was in  2009 when the Obama stimulus, 0% interest rates, TARP, and QE #1 combined to rescue equities.
  • The pro’s that trade the PCR are NOT impressed with the MO. There PCR is bearish

Bottom Line – It certainly looks like most stock investors/manipulators/traders are signaling a bull market in the future. An event like the 2009 rally may be getting started. Today is the confirmation day of Friday’s breakout from the trading range. It’s hard to ignore how oversold we are.

There is no clear buy or sell signal.

Low volume rallies are acceptable because major institutions, Pro’s, hedge funds and HFT’s believe financial institutions that do almost all trading  think financials and central banks have won in Europe & the US. The people/governments/taxpayers will socialize their losses.

__________________


Investors411 LONG Term Investments

Each day Paul (change setting from profile to activity) offers up to the minute commentary on the markets & YSL #5 in the Comment section of the blog. Catch his Paul’s Corner every Tuesday and Thursday.

Traders – You’d like a lower MO, but at least into the European summit on the 23rd it looks like bulls may rule.  Buy the rumor and after the 23rd it may be sell the news.   The high MO is going to make rallies hard. Kudos to those who bought the last risk on trade when the Dow was 1100 points lower

Because of the OMG MO – Short term traders may be successful in shorting rallies.

InvestorsTechnically, a confirmation of the breakout of this summer’s trading range is bullish and the long term outlook will change to CAUTIOUSLY BULLISH.

Bottom Line The economy is devastatingly poor for the vast majority of people in western democracies, but Wall Street is again winning.

Our Hedge Investment - Theory – Technology will do better than financial sector over time. Thus hedge is set to hopefully work well in both up and down markets.

  • Short Financials – Investors411 will use ultra short SKF (opened at 78.91 – now at 72.20).
  • Long technology - Investors411 will use ultra long QQQ (tech’s) QLD (opened at 81.13 – now at 89.15)
  • @ a 1+ % gain on this trade so far

The four horsemen – AAPL, AMZN, IBM and GOOG should outperform if we move higher. Also YSL #5

___________________


Long Term Outlook

3 to 6+ months

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

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.

  • Share/Save/Bookmark
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