.

Why so many people who remember the past have problems with the right wing’s political agenda

Obviously we’re NOT going to punish the uber wealthy, unregulated free markets and greed that got us into this horrific mess.

No the right wing agenda is to force cuts ONLY on working class Americans.

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JOBS, JOBS, JOBS

More and more, US multinationals are laying off workers at home and hiring overseas.

What happened after the 2008 meltdown is globalized employers laid off workers in the USA. Term for this is disaster capitalism. They rehired them in other foreign countries.

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Lipstick on A Pig

GreeceToday the Greek parliament will vote on and probably approve austerity measured imposed by the IMF and European Banks. Germany’s leader has proclaimed “Greece will NOT be our Lehman Brothers.” Stocks should rally. But are we putting lipstick on  PIIGS

Here’s reality – The massive protestors outside parliament against this are all voters. Voters almost always vote their self interest and Greece is a democracy.

Greek parliament is made up of 303 seats and the ruling Socialists (PASOK) who favor the bailout have a thin majority of 155 seats. The #2 party, New Democracy (ND) has 86 seats. The ND other minor parties who are also against the bailout have less votes.

Two major polls show that instead of the 2 to 1 majority that the pro bailout party enjoys over the anti bailout ND party in Parliament, the ND party is now slightly ahead in popularity. All the other minor parties (Communist is the next largest) have also gained ground. One can easily infer that the Greek people by the level of anger (there is a two day strike now happening) and polling data that sooner or later this vast majority of anti bailout voters will gain power in Greece.

All the PIIGS countries in Europe face similar problems. Sure looks like its just a matter of time before the you know what hits the fan.


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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

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Index Percentage Volume
Dow +0.91 Down
NASDQ +1.33 Down
S&P 500 +0.93 Down
Russell 2000 +0.92 -

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Technicals, Fundamentals & Analysis

Shorter Term Outlook.

  • Another significant weak and below average volume rally that was most likely dominated by the High Frequency Traders and one of the last Fed Fed liquidity injections.(this link is to a very negative view of Fed seen by almost 5 million people – their are holes in it, but its funny and has some significant facts) injections.
  • The McClellan Oscillator (MO) chart rose to +10.81 (below -30 = somewhat overbought, above +30 somewhat overboughtRepeatThe MO has been unable to get above the +30 to +50 range for 6 months. Still closest to middle of range and plenty of room for bulls or bears to work with = Neutral
  • $USD The Dollar fell  significantly -0.50% yesterday. (+/- 0.50 is a significant move and the dollar is usually a contrarian indicator) The trend since May 1 is bullish for dollar and bearish for stocks. The dollar fell back after just barely making a short term high on its chart. Tend for stocks Bearish

  • Reading The Tea LeavesShorter term – From yesterday – “Our MO chart has been very accurate in predicting short term tops and bottoms. So tea leaves say wait for an oversold or overbought levels to be reached before acting. The whole roller coaster ride of the last two weeks is a big spring winding.”
  • Chart of NASDQ – Today we may see some sort of short term breakout – we are far closer to upside breakout levels.

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Paul’s Corner

Gloom and Doom?

The market is down, much of our profits have disappeared  and there is no hope in sight, right? Well looking at market internals, there just may be some life left in the market. Ian Woodward posted a great blog this weekend and here are a few points to consider.

LINK

Ian includes charts to show how the market canaries (NFLX, AAPL, BIDU, AMZN) are performing.

The market is currently range bound between 2700 and 2600 on the NASDAQ. So consider 2700 as resistance and 2600 as support. If we go through 2700 on good volume the market is “probably” gonna keep going. If we drop through 2600 next obvious support is 2500, so watch these numbers closely.

One of the ways we follow the market is to look at  stocks ERG numbers to see which way the market is going. ERG refers to Earnings Per Share, Relative Strength, and Group Strength of the individual stock. Assigning a number between 1 and 99 to each of the ERG components you can evaluate the health of any stock relative to the rest of the market. A week ago we only had 13 stocks with an ERG number higher than 270, this week ended with 26. Although extremely low numbers, it still shows there are some quality stocks starting to move. Also the numbers of stocks with “A” accumulation ranking is improving.

I have been keeping an ERG list for years and it’s a very good confirming indicator for the market.

Last Thursday I posted a list of stocks that have done well through this correction and in his blog Ian lists a  group of 25 that are currently doing well. Between these two lists there are some good stocks to consider IF this market takes off.

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.

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YOUR Stock List
Your Stock List #4 (YSL #4) which was closed when Investors411 changed its outlook on May 20th again outperformed the S&P 500 over the same period of time. Paul informs me that the results were -
  • YSL = +4.64%
  • S&P = +1.60%

Paul has the full results and I will post them in the POSITION Section of the blog ASAP.

This time out we didn’t do as well as we would have liked, but the results were still positive. Both Paul and I will go over what worked and what failed this week to create a better YSL #5

Since WE have toasted  the experts and beaten the S&P 4 times in a row Paul has already called for a YSL #5. – Send in entries to me or post them on the comments section of the blog.

Send a sort list of  three  or less socks you think deserve consideration.  Paul and I will go over them and choose 12 to 15 that should again toast the S&P 500.

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Current Positions

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

NLYAnnaly Capital Mgt. Ultra high dividend stock. Bought on a dip over a month ago. After a 5+% gain is has come down a bit last two days.

Gold /Silver TradeThese commodities usually move the opposite direction of the dollar. Dollar is going up (mostly because European outlook is bleak) so gold/silver is going down.

Shorting Banks - one major reason major banks are underperforming stocks is that the Fed will on June 30th stop purchasing treasuries from them. This and mortgage problems have have led this sector down. There are some signs (three weeks of flat trading)  that a short term bottom has been reached (see link above)

Repeat longer Strategy remains - Waiting for MO to hit overbought levels before acting

  • Short any rally - Investors411 will use TZA (3X short small cap stocks) and SDS (2x short S&P 500 more conservative).
  • Sell long positions into any rally -

Disclosure - I own NLY &  a group of dividend stocks which I have used some short ETF’s to protect. – I buy all stocks mentioned in the hypothetical Investors411 portfolio.

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Look for an enlightened Paul’s Corner every Tuesday & Thursday and the always informative comments section every day.

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The Fed has moved from an expanding money supply to a neutral – No QE #3. Congress is threatening to contract the money supply. “We [the USA] need to grow at this point more than anything else.” Investors411 outlook will remain negative on the USA unless the Fed and/or congress return to more pro growth policies and/or Euro defaults are resolved.

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Longer Term Outlook

Neutral/CAUTIOUSLY BEARISH

The NEUTRAL in the forecast will vanish If/when we break the recent lows of the S&P 500 chart

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

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