The Battle for Castle Bear Skull (See Stocks below)

The New Gunslingers

Today’s Investors411 is using analogies to violence, wars, and brutality because we have all become so brainwashed by it. My mind is totally desensitized to violence because of a lifetime of TV. This weekend’s football & violent TV shows have taken their toll. I watched well over 100 people, killed, brutalized, raped etc.

How desensitized to Violence are You? Short Video presentation on how violence is used to brainwash YOU & get your attention. Thanks to Sherwehe for finding this. Dr George Gerbner is the expert

Economically, here in the USA we have been wounded. But for the US stock market and other Stock Markets throughout the world there are new Gunslingers that control/manipulate stocks. [NB - US economic's is often NOT in synch with stock markets] Their firing high powered machine guns to your singe shot rifle. This is a wealthy worldwide oligarchy of investors.

  • The BB/HFT’s (see many past Investors411s)
  • Sovereign Wealth Funds – (Think big exporting countries/Oil rich dictatorships)
  • Emerging Market Investors – (Perhaps some not as filthy rich as everyone else – a growing upper middle classes along with controling oligarchy)
  • Hedge Funds (Depositories for wealthy investors whose top managers can make  $900,000 per hour and get taxed at 15%)
  • Central Banks (Not exactly new gunslingers, but most countries try to manipulate their currency lower so their exports cost less abroad)

YOUR Comments

Coming tomorrow is Jim J. list of candidates to invest in. It’s rare, but there were comments over the weekend on Stocks Paul R & The Critic) and Yankee Bob takes on one of the major industry groups that makes up the growing Corpocracy (vs. Democracy) in the USA.

KISS & Stocks (Keep It Simple Stupid)

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Index Percentage Volume
Dow +0.12% up
NASDQ +0.54% up
S&P -0.08% up
Russell 2000 +0.56% -

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Technicals, Fundamentals & Analysis

Investors411 record – 5 years of beating benchmark S&P 500

Mantra for September“The Black Box/High Frequency Traders BB/HFT control the majority of trades. Jim Cramer -”BB/HFT make up 80% of trades.”

Term for the Day -Technical Analysis (TA)- From Investopedia

“Technical analysts believe that the historical performance of stocks and markets are indications of future performance.

In a shopping mall, a fundamental analyst would go to each store, study the product that was being sold, and then decide whether to buy it or not. By contrast, a technical analyst would sit on a bench in the mall and watch people go into the stores. Disregarding the intrinsic value of the products in the store, the technical analyst’s decision would be based on the patterns or activity of people going into each store.”

For me TA is looking at charts and finding patterns- Reasons TA works as a forecasting tool tomorrow.

US Markets -

Friday’s was what’s called “options expiration Friday”. Hard to use as a forecast tool because the increased volume is traders covering (buying) options that are coming due the third Friday of the month. We will go over options later this week.  YOU can look it up in Investopedia.com today.

Below is the same chart of the benchmark S&P 500 (SPX) that 10,000+++ technical analysts are showing their clients and 1,000,000+++ traders have already identified. It’s from Stockcharts.com - A free site that Investors411 uses for all its charting data.

To everyone who follows Technical analysis this chart screams today (perhaps this week) is REALLY important.

The SPX is at a triple top. Three times the bulls have charged the bears cave or Castle Bear Skull (my term for wannabe victorious bulls to call the bears resistance level) and twice before the bears have held. Everyone knows the bears are tough at this point. Lots of bets are being placed on the bears or bulls will win. Bears win markets go down and the level @ SPX 1130 becomes a super strong resistance level. Bulls win and its rally on.

The annotations on the above chart were written by John Nyaradi

Significant Indexes

  • The Dollar (USD) [Anything daily price move over +/- 0.50 is significant. Dollar moves inversely to stocks] The dollar, rose  +0.20% Friday. The dollar broke down below its short term support level, but recovered – Bearish short term (daily) sign for stocks. But, longer term, Falling dollar trend for stocks = Bullish
  • The Baltic Dry Index (BDI) [measures cost of world trade. Also proxy for China & emerging markets] Fell a -2.23% Friday.  The BDI does not have the immediate impact that the MO or Dollar does. Fifth down day in a row, with rate of fall decreased. After 8 week bull run trend could be changing to bearish, but still= Neutral
  • McClellan Index – (MO) [The rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks.] MO rose slightly to +24.97 yesterday. Note – While zero is the center of this chart the 50 DMA is at 19.29 That’s a support level. = NEUTRAL

Reading Tea Leaves

From Friday -If the baby Bull, pictured earlier this week is going to get on its feet, this would be the time to rise…Perhaps Monday will be the key.

Let the battle for Castle Bear Scull begin.

This battle is going to get manipulated by everyone from HFT’s to Hedge Funds (that often are HFT’s)

Lots of bears believe that the bulls are depleted – too many up days have created over bought conditions and the US/Europe economic news is lousy. Oil prices have fallen recently and are near support levels.  The advantage the bulls have is

  • Momentum – The rising blue line on chart – That’s the 50 Day Moving Average of Price.
  • Many Emerging Markets have already busted out and taken over their castle Bear Skulls.
  • The MO has a lot of “wiggle room” to move higher – The MO’s 50 DMA is high and its got 35 points between where it now stands and 60 – overbought territory.

Monday’s are usually the day of the week that bulls make their charge. Ironically, my major concern is too may analysts are thinking/predicting a bull’s victory.

Almost forgot – Watch the dollar – UUP (ETF for Dollar) If it breaks down, bulls have another army of reinforcements.

Positions

The  Positions Section link to latest & former buys and sells  - These are positions I actually own

(I do manage 6 accounts that have other positions)

Current Longer Term positions –  EWS (Singapore) & USO (price of oil/commodity)

TradersShort term trend is bullish for stocks. If we can get @ a 100 point drop in Dow and you can tolerate risk – you could nibble. Not guts no glory – I’d love to wait for a 100 point Dow dip, but you can feel the bulls breath & it may never come before the rally.

There’s lots of choices (see Positions sections of blog for ETF choices or Paul’s analysis of individual stocks). I’ll probably play SSO (ETF that’s 2X S&P 500) on smaller dips (if I have the time)

Do NOT chase over extended stocks/ETF’s

Investors - Wait for a bigger drop in MO before going long. Also recommend a long term position in USO that is dipping right now. ( See Positions Section of blog & comments section Friday)

If, we get up over +60 on the MO and  the Dow/major indexes rally – that would be a selling or shorting point.

Long Term Outlook - CAUTIOUSLY BULLISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!


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