Investors 411 Blog

Bob Herbert- NYT

Jobs, Jobs Jobs

Agree with NYT’s Bob Herbert, “Obama’s Source of Trouble” is Jobs. The Obama administration from the start has underestimated the depth of this recession and its underlying causes. The end result – JOB LOSS in the USA.

Unfortunately, research on YOUR stock picks takes time, and I’ve run out.

KISS & Stocks (Keep It Simple Stupid)

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage	Volume
Dow	-0.13%	down
NASDQ	+0.25%	down
S&P 500	-0.02%	down
Russell 2000-	+0.16%	-

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

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

Lightest trading day of the year.  Markets went no where.  Basically, this is a slight positive for bulls, because it means Friday’s rally held.

CSCO has some big announcement today – 11:00AM EST – Usually stocks run up before major announcements and investors sell the news.

NASDQ reached a new yearly high in weak volume. Think the benchmark S &P 500 has at least one more push to a new high this week or next. Then it should pull back. Longer term Outlook Cautiously Bullish.

Significant Indexes

• McClellan Oscillator dropped a bit to +68.29 yesterday. We are still well above +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK.

• BDI – The Baltic Dry Index, which measures the cost of world trade (also a good indicator of how China is doing since they are huge exporters/importers) has exploded higher in the last few weeks = Bulls rule Yesterday the BDI, like stocks leveled off in front of a strong resistance level.
• USD – The US Dollar has been range bound for about a month after moving significantly higher. Early Dec the dollar bottomed at $74+ and is now at $80+. There are some pluses and minuses to the strengthening dollar. For US stocks the fact that they and the dollar are near highs together is Bullish

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Since the McClellan Oscillator over +60, or overbought – buying right now is far more dangerous than when markets are oversold. I’m waiting till we get around +20 just to  nibble some more on some of  these stocks. Most stocks move with the overall markets. YOUR decision on when to trade is also based on how long you are going to hold the stock and YOUR level of risk.

If you are considering individual stocks I strongly urge you look at the charts and learn something about technical analysis.

NB -Last Week’s comments in black. This week’s violet. Charts underlined in Blue

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

• CAAS – volume confirming rally – A buy the dip stock. Ever since this stock was put on list it has gone up big time. A buy the dip stock
  
• PCLN – Breakout 5.22% move yesterday in good volume – A buy the dip stock Dipped last week and now in rally mode A buy the dip stock
• F – Breakout 5.71% yesterday in good volume – A buy the dip stock. Too over extended or above 50 day Moving Average.
  
• IMAX Investors411 owns this stock – Broke out to new high. Up +8.16 yesterday. A buy the dip stock
• CSCO, Slower steadier more for longer term investor. Like AAPL at new high this year. For longer term investor. A buy the dip stock
• SHOO, A 4.02% breakout in good volume yesterday – A buy the dip stock – traded flat after breakout – in consolidation A buy the dip stock
• ICON, Has formed a series of higher lows & higher highs – A buy the dip stock Broke out and is on run higher. Too over extended now.
  
• VPRT Up +2.49% yesterday in what could be a breakout – A buy the dip stock – Did break out. A little overextended. A buy the dip stock
• DGIT Thinly traded A buy the dip Consolidating A buy the dip stock
  
• CTCT Building on higher highs and higher lows – Buy the dip Thinly traded but Good volume and another breakout A buy the dip stock
  
• VCI Dipped and has made up most of that loss, but in weak volume Tempting, but risky Another breakout, over extended Tempting, but risky
• CREE -  Too overextended to buy now - A buy the Dip stock Starting to Dip A buy the dip stock
  
• SNDK – . Overextended now but Buy the Dip stock Dipped then moved higher. Too over extended
  
• VSH – . On another breakout,but in weak volume and overextended -  Too risky. Consolidating and now looking better, a little over extended Tempting
  
• HMIN – Up 4.02% yesterday in breakout, but weak volume. Too Risky Falling Too much downside volume

I like PCLN, VPRT, & SHOO because I understand what they do (buy their products), not because they are technically superior to the other stocks on this list. F (Ford) has just gone up too much. Personally, even though many of these are tempting, I’m waiting till conditions are more favorable to buy.

I would buy dips in IMAX. Thanks to two of you for reminding me they have their earnings report on the 11th. Alice in Wonderland has confirmed people will pay a premium for 3D movies.  With 3D TV’s already being sold and a 3D channel coming I think it clearly going to grow.

Bottom Line - Right now thinking more about selling (taking profits) than opening new positions because of short term over bought conditions.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Football lover Karl Marx

Football and Karl Marx

Football is America’s #1 sport. The Superbowl where (economically shattered) New Orleans Saints beat another small market team the powerful Indianapolis Colts, was watched by more viewers here than any other American sporting event.

Football reins supreme because there is parity in the league or socialism. There is a market cap which no team can go over in payment for all combined players, and a draft for new players where the worst teams choose first.  This is a socialist goose that has been laying GOLDEN revenue eggs for the NF. Unlike baseball that’s hurting for revenue and is in decline because of a less balanced revenue program. In Baseball any team outside major media markets has a far less chance at winning. Each stadium gets packed in football, while only a half dozen do in baseball. Karl Marx would clearly be a football fan.

Now owners and players both want to change the system in a rush of unregulated capitalist greed. So if anyone asks you if socialism works in the USA – you say it sure does – its called the National Football League. Socialism Makes Everbody Rich. Why change it?

Elections – Iceland/Iraq

Two major elections took place late last week

• Iceland – Remember Iceland was perhaps the country worst hit in 2008 meltdown because their shadow banks believed in Greed based capitalism. Over 98% of the voters there voted to renegotiate loans of foreign investors who had put their $ in Icelandic banks.  Seems they did not want to pay back billions with their tax dollars.
• Iraq – Over 2 million Iraq refugees voted from Foreign countries. They are too afraid to return. Still the world’s largest refugee crisis. Even with the elections there are many signs that the different religious/ethnic factions have no intentions of compromise. Oh well, neither do the two major parties 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!

Index	Percentage	Volume
Dow	+1.17%	up
NASDQ	+1.48%	up
S&P 500	+1.40%	up
Russell 2000-	+2.08%	-

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

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend. (No changes this weekend)

US equities rallied significantly on Friday. but volume was just a wee bit higher. Long term capital is just NOT flowing into equities in the USA. Unlike the start of the bull market in 2009 when we saw massive amounts of volume. Investors are staying on the sidelines. Volume has been for decades the #1 confirmation factor of a price move. However for the last 6 months its been pretty anemic & useless as a forecasting tool.  Basically this looks technically like we are building a bubble and obviously investors are doubting the rally

The Russell 2000 has already broken out to new highs

Overbought US markets (SPX up 6 days in a row, and up 11 of the last 14 trading days) are all close to new highs. The NASDQ is o.o2 points away from a breakout to a new high.

Last Week’s Fearless Forecast

Investors411 predicted a rally at the week’s start that would get sold into because of an overbought market & the unemployment report – Therefore a “flat week” As stated last Friday - ” The unemployment numbers Friday were as good as it gets for US stocks.” The fact that employment is NOT declining means interest rats will stay low and the Fed will keep flooding the economy with money. From Friday AM -  “Expect a rally.”

Miscalculation about the jobs number (I expected worse than a flat -9.7%) and ignoring looking at the exploding BDI (see below) were the reasons for last week’s miscalculations.

This Weeks Fearless Forecast

The McClellan Oscillator hasn’t been this high (+75.33) since last April. We are also approaching a major resistance level – the January  high of 1150 on the benchmark SPX or S&P 500 (now at 1139).  It seems likely that this level will get challenged.

• Fundamentally it sure looks like the FED has reason NOT to raise interest rates (employment numbers) and that will keep interest rates low – great for stocks.
• The BDI is exploding higher. (see below)
• The Gree debt problem seems to have settled and “will not spread.”
• Any serious attempts at financial regulations seems to be disintegrating.

So fundamentals are moving in one direction against strong technical resistance. Look for a week where at least the NASDQ joins the Russell 2000 and breaks out to a new high, Even though volume is lacking – momentum should make this an up, but volatile week.

Significant Indexes

• McClellan Oscillator jumped significantly to  +75.33 yesterday We are now well above +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK. The only other time we saw numbers on the McClellan move higher than this was three times from November to March 2008/2009. The all time high was +121.86 in the last week of last year.
• BDI – The Baltic Dry Index, which measures the cost of world trade (also a good indicator of how China is doing since they are huge exporters/importers) has exploded higher in the last few weeks = Bulls rule
  

Because Investors411 recently changed the Long Term Outlook to Cautiously Bullish - any pullback in the McClellan Oscillator to say +20 would be an opportunity to nibble again.  This market wants to move higher.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Wish Investors411 had more stock positions (only @20% invested in stocks because of overbought technical situation) Will keep selling into any major rally the remainder of the portfolio.  Certainly a breakout over SPX 1150 would be one of those situations.  Right now what to look for is are stocks going to go “elliptical” (continue to move higher at a rapid rate) and blow through last years high.

Would sell more into that rally and buy/nibble more on any drop in McClellan to @ +20.

IMAX – 3D Alice in Wonderland had a HUGE $116 million dollar opening. Avatar’s opening weekend was $55 million.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Poster from 1880

Your Comments

The Day Democracy Died – or the Corporate takeover of America – has received more of YOUR comments (7 public and 4 personal) than any other editorial. We the People , in the USA,  has become We the Corporation. Check out all the insightful public comments (scroll down). Most are listed on the right side of blog.

Fundamentally Democracy has changed in the USA. Investments are taxed at 15% and working class Americans are taxed at

• $8350 to 33,950 = 15%
• $33,950 to 82,250 = 25%
• $82,250 to 171,550 = 28%
• 171,550 to 372,950 = 33%
• above 372,950 = 35%

Bottom line here is that our tax structure encourages investment/gambling on corporations for a living rather than working for a living. People like me are spending more and more time investing/gambling , in part because of the lower tax rates rather than working.

Bottom Line – This adds to the destruction of the work ethic in America . It also make the wealthy who own most stocks, (trust fund children, hedge fund managers, those in the ultra upper class) wealthier. Again the corporations win and working Americans loose.

Even Investors411 is kind of a Dr. Jekyll & Mr Hyde by offering investment/gambling advice while at the same time recognizing that we are all (as one of you put it) on the Titanic (perhaps a better name would be the Good Ship Democracy) rushing from one side to the other.

There is a quantum shift in that investment advice below

KISS & Stocks (Keep It Simple Stupid)

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage	Volume
Dow	-2.09%	down
NASDQ	-2.67%	down
S&P500	-2.21%	down
Russell2000-	-1.79%	-

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

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend.

US stocks got toasted in HUGE volume – AGAIN – Technically – It’s starting to look like a market that is going elliptical to the downside  or a climax sell off. Four reasons were given for stocks big drop this week.

1. China – China was going to tighten credit and therefore growth would slow.  The BDI which measures the flow of goods, specially China imports shows no signs of collapsing  (see below)
2. Obama will go after shadow banks . If successful this would mean to big to fail firms like Goldman Sachs will be broken up into several pieces.  All the shadow banks can now (Supreme Court decision) spend whatever they want (including your tax dollars and the trillions that the Fed is loaning them at 0%) to prevent this.  It’s an election year and within the Obama administration Bernanke, Geithner & Larry Summers are solidly behind the too big to fail banks. Summers even helped to write the legislation that created shadow banks.
3. Bernanke will not get reappointed – Bernanke was one of the arsonist who brought the world to edge of an economic meltdown and one of the firemen to bail it out. If Bernake’s appointment goes down so will stocks. The uncertainty created by a new Fed chair would hurt stocks. But according to most reports Bernanke has won needed support over weekend .
4. There is no V shaped recovery – My best read of the tea leaves is they are right as far as the economy/jobs are concerned. But earnings reports are showing a lot more  big companies with international exposure are beating earnings on the top and bottom lines.

Relevant indexes

• McClellan Index ($NYMO) at -79.33 = significantly oversold .  Well beyond the  @-60 or oversold level.
• BDI -  The BDI/China has come down from highs in mid November. The Baltic Dry Sea Index has leveled off over the last month and started up the last two days.

Two events, outside of earnings which have been rather  good, significantly impact stocks - The Bernanke appointment (Tuesday) and Obama’s State of the Union (Wednesday)

Long term Outlook has changed to NEUTRAL because some key technical levels were broken in big volume.

Positions

The  Positions Section (also at top of blog) has the latest buys and sells (Usually updated over weekends)

These are positions I actually own

I’ve set up two charts. Put them on a split screen and compare. Both are 18 month charts McClellan Oscillator & the S&P 500 Notice that only 4 times in the last 18 month has the McClellan dropped below 80.  Each time it rebounded. It did reach @120 – 3 times  The Oct. 2008 meltdown, The March lows after the Obama election and a 6+% November correction .  3 times the McClellan has reached 80 and rebounded. Once it reached 100.

Bottom Line – chances are good we are going to see some sort of rebound this week. US markets are oversold and could go lower, but this looks like a good place to add 10 to 20% .  If McClellan goes lower (past 100) I’d add more. Fundamentally -  the situation is no where near as bad as it as at the beginning of 2009.  Working class American’s are going to suffer – but stocks with International exposure to emerging markets are going to flourish.

Everybody else is selling, now we start to buy.

SELLING & BUYING

More on exact buys and Sells on Monday.

See POSITIONS (scroll down) for details on this and what’s under consideration for 2010.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Celebrities will Save Us – NOT

Last weekend we were fortunate enough to see Pirate Radio . Before the movie, a promotion for Glenn Beck came on featuring him crying, screaming & on his knees in front of a theater audience. This evangelical performance was to be broadcasted over the next few months in theaters nationally. God help us.

Poor Arnold “the terminator” Swartzenegger – the celebrity Californian’s elected to save their state. He couldn’t and next to Michigan, California has the highest unemployment in the country. Like Palin or Obama (see past updates) America’s fixation with celebrity status and Beck tears, screaming or getting on your knees, will save nothing. “The terminator’s” problem is he couldn’t save Californians from their own greed and governance.

• Prop 13 limited tax increases and erased a $4 billion tax surplus in a few years.
• Property taxes were based on when you bought your property. So a property bought decades ago pays far less in taxes than an exactly similar property bought today.
• You need a 2/3 vote of the legislature to change any taxes
• Californians voted for things like costly regulations limiting pollutants because so many were dying from filthy exhaust and waste.
• The “Free market” capitalism  mantra dominated California and unregulated companies like Enron were allowed to rape the state.

EW in the comments section of the blog, seems to suggests who will save us from ourselves .  One example – We spend trillions in foreign nation building wars, yet keep cutting taxes.  Our system of governance isn’t working. It’s being overwhelmed.

Tom Friedman on the Charlie Rose show  articulates the problem. You should see the video LINK But here’s a list of some of his main points that we need to overcome

• Money in Politics
• Gerrymandering political precincts
• Cable TV fracturing & empowering extremes
• Internet (both good and bad) but also empowers extremes
• Permanent presidential campaigns
• A globalized business community that is AWOL on major issues.

EW like Tom Friedman seems to believe “we need better citizens… not leadership.” China is producing better solutions than we are. As Tom Friedman’s grammy puts it -  “A great power that only produces sub optimal solutions will no longer remain a great power.”

KISS & STOCKS

Keep It Simple Stupid

For those of you whose eyes gloss over in the stock section I’ve tried to KISS it today, but I left a little in for those who want the deeper analysis

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage %	Volume
Dow	-0.14%	down
NASDQ	-0.50%	down
S&P500	-0.32%	down
Russell2000	-0.17%	-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

• Brown = repeat statements
• Green = usually bullish statements
• Red = Usually bearish statements

Technicals, Fundamentals & Analysis

Basically we had another  the dollar rose so stocks fell day.

Volume decreased and was well below average.  This is surprising on an options expiration Friday. What this tells us. – There is no money coming in from the sidelines – Its certainly more than beginning to look like a whole lot of investors are NOT going to get back into the market. Long Term this is understandable and a bearish for markets The rally in stocks is based on the dollar falling – when that runs out we have a problem

However, the Dow was down over 100 points below where it closed and rallied into the end of the day.  Why?

It’s Thanksgiving week and historically stocks rise on this shortened week. (best guess 7 or 8 out of last ten years) Monday’s have been good to stocks since Sept (again @80%% of the time)  The rally was simply short term traders getting in front of what they expect to be a good week.

Big news for week is the shopping numbers fro Black Friday & the unemployment #’s for the week.

Congress is loosing patience with the Fed & Geithner - LINK – This could negatively impact stocks, but most likely in December.

FEARLESS FORECAST – Up Week

Now going to get a bit more technical

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

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI - The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI has broken out to new yearly high

The BDI fell a significant -155 points yesterday and closed at 4507. The up 16 days in a row streak has been broken . Technically it broke out through its major resistance level 4291 (this year’s high)  The BDI has rallied about 2300 + points since late September.

The BDI is starting to go PARABOLIC – starting to move up too far too fast-inevitable result is a crash and burn.  We seem to be at the top of the parabola. DANGER for Bulls

Going Parabolic is one of the easiest technical forecasts to predict. Investor’s411 called this reversal to the day.

What it means – Long term we created a higher high on the chart = Bullish. Short term we are on the way down = Bearish The BDI is far more useful as a long term indicator of not only world trade, but specifically China and growing emerging markets.

——-

The Dollar is currently the #1 forecasting tool .

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

Mantra – Dollar up = US stocks down & Dollar down = US stocks up

US dollar rose  +0.43% Friday. The dollar closed at $75.61 .  The dollar is in a narrowing trading range between $75 & $76.

——-

$NYMO The NY Stock Exchange McClellan (EOD) Index measures how much the NYSE is oversold or overbought .

It is a short term indicator and no t to be used for major trends.  Traders and short term investors should find this oscillator very useful.  There are dozens of similar forecasting tools, but the McC Index is clear, simple, and right now pretty accurate. The more oversold we get the better the odds are the market will rebound and visa versa on overbought.

The index closed at -29.78 This indicates stocks are somewhat  oversold .

Key to chart – Zero  is roughly  neutral and roughly when you approach to @ +60 you are overbought and approaching-60 you are oversold . Buy at oversold and sell at overbought. Nothing is absolute in this chart. In fact using the moving averages as a central point is better than using zero. Nothing is absolute about the minus or plus 60 number either.

Oversold conditions = buy, Overbought positions = sell

Positions

The  Positions Section (top of blog) to see all the latest buys and sells

I did get a chance to do some editing in the Positions Section of the blog.

Long Term Outlook - We are on the cusp of change between CAUTIOUSLY BULLISH and NEUTRAL for stocks.

Long Term Outlook = CAUTIOUSLY BULLISH

Health Care

Robert Reich – fromer Sec. of Labor

Frankly Abby Gold (see comments on right) says it all on health care .  This country used to care. There was a bond between neighbors. Now the rich get socialism whenever they are in trouble and the poor and working class average Americans get ground into the ground. This is a mega trend in the USA that’s spiraling in the wrong direction.

Economist Robert Reich has an editorial on – What happened to the public option. LINK

Mexico & Afghanistan

(to be continued over weekend)

KISS & STOCKS

Keep It Simple Stupid

For those of you whose eyes gloss over in the stock section I’ve tried to KISS it today, but I left a little in for those who want the deeper analysis

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage %	Volume
Dow	-0.90%	up
NASDQ	-1.66%	up
S&P500	-1.34%	up
Russell2000	-2.41%	-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

• Brown = repeat statements
• Green = usually bullish statements
• Red = Usually bearish statements

Technicals, Fundamentals & Analysis

Volume – Volume  rising (see above chart) is important, but it saw still below average. So there is no real big forecasting signal.

Something called Options expiring (3rd Friday of each month – today) is probably what’s behind all this volume. The more sophisticated short term traders are forced to cover some of their bets at the last minute before they have to buy or sell a stock they have an option on.

If you get lost with a term or want to know more use Investopedia.com dictionary and other help programs or Stockcharts.com tutorial programs.

Why Stocks Move Lower – Yesterday we did Higher and probably the #1 reason is the government shoveling so much money into the economy at almost zero interest rate forces people into stocks. The alternative is a measly couple points in a bank savings account or add another point for a bond. So here’s the downside -

• Job, Job, Jobs – Companies fired workers and now first will  first hire overseas where it cost less and the growth is greater.
• American’s middle class went overboard into debt and is now saving more. Our consumers are saving more, therefore, not buying. Good to save more, but bad for economic growth
• Trust – The rich (shadow financials & others) get risk socialized by the government and the middle class gets capitalism. Folks know their getting screwed – they/we are angry.
• Foreclosures – still happening at a far too big a rate despite stimulus.

The best case scenario for economy – All those who made huge money in the stock market or trading credit derivatives this year buy and eventually this will “trickle down” to the middle class.

Important to remember – Stocks can move in one direction and the economy in another.  Perversely, in the short term, if job loss stays high interest rates will stay low to act as a counter balance.  Stocks historically always rise in low interest rate environments.

Now going to get a bit more technical

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

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI - The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI has broken out to new yearly high

The BDI rose a n insignificant  +18 points yesterday and closed at 4661. Up 16 days in a row . Technically it broke out through its major resistance level 4291 (this year’s high)  The BDI has rallied about 2400 + points since late September.

The BDI is starting to go PARABOLIC – starting to move up too far too fast-inevitable result is a crash and burn.  We seem to be at the top of the parabola. DANGER for Bulls

——-

The Dollar is currently the #1 forecasting tool .

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

Mantra – Dollar up = US stocks down & Dollar down = US stocks up

US dollar rose  +0.31% yesterday. The dollar closed at $75. 29 . This is back above the major $75.00 support level. 

CAUTION – The first breakout (up or down) is often false. This happened two days ago . Dollar back in trading range. The top of that range is the falling 50 day moving ave. now at $76.02

——-

$NYMO The NY Stock Exchange McClellan (EOD) Index measures how much the NYSE is oversold or overbought .

The index closed at-22.67 This indicates stocks are slightly oversold and momentum for bears is growing

Even though the Dollar Rules consider overbought levels (60+) on this index a point to lighten up on stocks)

Key to chart – Zero  is roughly  neutral and roughly when you approach to @ +60 you are overbought and approaching-60 you are oversold . Buy at oversold and sell at overbought. Nothing is absolute in this chart. In fact using the moving averages as a central point is better than using zero. Nothing is absolute about the minus or plus 60 number either.

Oversold conditions = buy, Overbought positions = sell

Positions

The  Positions Section (top of blog) to see all the latest buys and sells

Sorry have not had a chance to update Positions section in well over a week – see past updates.

Long Term Outlook - We are on the cusp of change between CAUTIOUSLY BULLISH and NEUTRAL for stocks.

Bottom Line – As Investors411 warned US equities are turning negative.  The point to add to positions will NOT come till we reach oversold positions on the McClellan Oscillator

Long Term Outlook = NEUTRAL

Let Them Eat Cake

“Marie Antoinette à la Rose”

Harry Ried and the Democratic Senators have come up with  a Health Care plan that insures an additional 31 million Americans and closes some coverage loopholes -  Even though this plan is far weaker than other plans that have been voted and kept in place by the voters of other civilized industrial democracies the left wing Huffington Post seems to be happy - LINK

Michael Moore and others call this a giveaway to the health insurance industry LINK

The Marie Antoinette crowd who would rather tell the children, those seeking employment and others to “let them eat cake” have come up with nothing to help even the uninsured.

Global Trends & KISS

(Keep It Simple Stupid)

Yesterday, Investors411 went over an obvious global trend - sex , from politics to economics, sells . Incidentally, all the stores I went too were sold out of the Newsweek  magazine with the hot Sarah Palin cover. It probably went as fast as the  Washingtonian magazine with the hot Barack Obama cover.

In the Overview Section LINK of the blog, written a year ago are outlined 4 major trends that that greatly influence economics and the stock market.

Relative to all the major investors out there, I’m for lack of a better word stupid . They know more, have armies of help and banks of computers. So I’ve identified 4 major mega trends that not only make YOU and me better investor, but helps understand or relates to all things from economics to politics. It’s worked for the last 5 years so there is probably something to it. In short they are -

• Globalization
• The shortage of commodities (Peak Oil)
• Spread the Wealth
• The Great Recession

Yes,the  Overview Section which covers this in more depth, should get revised or updated.

In a narrow sense, they are investment tools that have given Investor411 the ability to outperform the benchmark S&P 500. In a broader sense, they make the world more understandable.

KISS & STOCKS

For those of you whose eyes gloss over in the stock section I’ve tried to KISS it today, but I left a little in for those who want the deeper analysis

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage %	Volume
Dow	-0.11%	up
NASDQ	-0.48%	up
S&P500	-0.05%	up
Russell2000	-0.36%	-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

• Brown = repeat statements
• Green = usually bullish statements
• Red = Usually bearish statements

Technicals, Fundamentals & Analysis

Volume – Volume or how many people buy/sell a stock on a given day his usually the #1 confirmation factor of a price move. That’s why in the above chart the price and volume figures of the major US stock indexes are used. When lots of investors buy or sell the price move becomes more significant.  Kind of like a crowd that rushes through the front door (the door would be called technical support or resistance level in stock market terms) on the day of the big sale.

Today even though the volume was up from the previous day its NOT significant because it is still below the average volume.

If you get lost with a term or want to know more use Investopedia.com dictionary and other help programs or Stockcharts.com tutorial programs.

Why Stocks Are Moving Higher – There are several major reasons and lots of those reasons relate  to the 4 mega trends.

• Many emerging markets like China never entered recession. They have managed or regulated capitalism, not our unregulated free market system.
• Stimulus programs around the world in all the G 20 countries. Basically governments printing money, cutting taxes, low interest loans etc. Stimulus works best if you have lots of money saved (are a creditor nation) and badly if you are in debt. (you are a debtor nation)
• While the financial meltdown caused by not regulating the US financial system  did spread and impact the world. Countries that bought into the US “free market” or “greed will regulate itself” system were hurt the most. Therefore, there are some heathy countries.
• The US government/taxpayers socializing the risk of the shadow banks and let them remain in the shadows by eliminating mark to market accounting and has NOT offered any real solutions. The same bubble is building again and stocks ar rising.
• Zero interest loans by US government creates a whole bunch of cash that has to go somewhere – Under the sofa, collateral for bad loans, and/or into the stock market.  So stocks look relatively cheap.

Now going to get a bit more technical

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

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI - The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI has broken out to new yearly high

The BDI rose a  HUGE +258 points yesterday and closed at 4643. Up 15 days in a row . Technically it broke out through its major resistance level 4291 (this year’s high)  The BDI has rallied about 2400 + points since late September.

The BDI is starting to go PARABOLIC – starting to move up too far too fast-inevitable result is a crash and burn. DANGER for Bulls

——-

The Dollar is currently the #1 forecasting tool .

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

Mantra – Dollar up = US stocks down & Dollar down = US stocks up

US dollar fell  -0.32% yesterday. The dollar closed at $75. 06. This is back above the major $75.00 support level. 

CAUTION – The first breakout (up or down) is often false. This happened two days ago Right now the momentum (since the long term trend is down) is with the Dollar bears and consequently stock bulls

——-

$NYMO The NY Stock Exchange McClellan (EOD) Index measures how much the NYSE is oversold or overbought .

The index closed at +12.85 This indicates stocks are slightly overbought 

Even though the Dollar Rules consider overbought levels (60+) on this index a point to lighten up on stocks)

Key to chart – Zero  is roughly  neutral and roughly when you approach to @ +60 you are overbought and approaching -60 you are oversold . Buy at oversold and sell at overbought. Nothing is absolute in this chart. In fact using the moving averages as a central point is better than using zero. Nothing is absolute about the minus or plus 60 number either.

Oversold conditions = buy, Overbought positions = sell

Positions

The  Positions Section (top of blog) to see all the latest buys and sells

Sorry have not had a chance to update Positions section in well over a week – see past updates

Investors – Folks who buy and want to hold for months/years.

Comments – NOT the time to buy or add to recommended positions. (FXI, EWZ, GLD )  Enjoy the rally. Shorter term investors may want to sell part of the 3 major positions while they are at highs.

Repeat – Clearly NOT the time to be adding long positions.  We’re close to new highs in major positions and the BDI looks like its started a parabolic run. (GLD might be an exception here and buying a small dip still makes sense)

MOO agriculture ETF has just broken out of its trading pattern to the upside and a minor position could be started. (more later) Still considering minor position in  VNM (Vietnam ETF – has dipped recently)

Obviously would like to buy more but waiting for a more oversold environment. Looks like we may be starting a correction.

Traders – Folks who day trade or are in and out of stocks within a month or two

AMZN & NVS positions are on hold right now. We’ve already sold 1/2 these positions.

Long Term Outlook – The dollar looks like it may break down through major support and the benchmark S&P 500 is on the verge of a yearly high – Outlook will change to CAUTIOUSLY BULLISH if/when this happens. But subject to further change back to neutral since breakout was weak.

Long Term Outlook = CAUTIOUSLY BULLISH

The Second Maine Militia

Second Maine Militia leaders from Time Magazine

There are three excellent comments that you should read to the right. Let’s focus on Popeye’s reference to the forming of the Second Maine Militia . – They open their yearly meeting by blasting fake TV with smiley faces and phony slogans painted on them with AK 47’s and old cannons. Article from Time magazine  LINK

They get it.  They share the view that the US government has lost its moral authority. The problem is not right vs. left, Democrats vs. Republican , but “up vs. down.” Money quote – both political parties have “ degenerated” …“into whores for wealth and arbiters of empire.”

Something the Maine 2nd militia would be up in arms about is how Tim Geithner as NY Fed chair (now Obama’s Sec. of Treasury) sold out the taxpayers by over compensating the shadow banks (or in Maine Second Militia terms “whores for wealth”) in the AIG bailout. Lead story in NYT business section LINK

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage %	Volume
Dow	+1.33%	up
NASDQ	+1.38%	up
S&P500	+1.45%	up
Russell2000	+2.83%	-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

• Brown = repeat statements
• Green = usually bullish statements
• Red = Usually bearish statements

Technicals, Fundamentals & Analysis

KISS = Keep It Simple Stupid – The dollar rules

Dollar broke down through its $75.00 support level and the benchmark S&P 500 broke out to new yearly highs.

Volume our usual #1 confirmation factor was up, but still below average . Volume, therefore, did NOT confirm the price move. In fact over the long term the rise in stocks and decline in volume almost always signals a major reversal. But, for the last few months the Dollar rules and little else matters.

Bernanke spoke yesterday and overall he was very negative on the US economy. This is bad for Main Street and Jobs. But good for Wall Street because interest rates will remain low for a long time (Lots more on this, but limited time this AM)

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI - The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI is @ 1+% off its high (early June) Before that it gained almost over + 630% from its all time low of 663 in Dec. of 2008 (April 2009 high of 4291 )

The BDI rose a  significant +109 points yesterday and closed at 4220. Up 13 days in a row . The BDI’s growth did slow down a little as it approaches its major resistance level at 4291 . (This years high)  The BDI has rallied about 2000 points since late September. =  Bullish for stocks & world trade right now. Especially good for our positions in FXI & EWZ

——-

The Dollar is currently the #1 forecasting tool .

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

Mantra – Dollar up = US stocks down & Dollar down = US stocks up

US dollar was down a  significant  -0.47% yesterday. The dollar closed at $74.88 . The $75 support level has fallen . If the dollar closes below $75 today it will confirm the breakdown

Which ever side the Dollar breaks out through will set the momentum for it and the opposite will happen for US ( and most world) equities.

CAUTION – The first breakout (up or down) is often false. Right now the momentum (since the long term trend is down) is with the Dollar bears and consequently stock bulls

——-

$NYMO The NY Stock Exchange McClellan (EOD) Index measures how much the NYSE is oversold or overbought .

The index closed at +35.50 . This indicates stocks are overbought and The McC rose +28.62 yesterday  If we get another rally this big stocks will be clearly overbought and its definitely time for long term investors to take some profits.  No one should be adding to long positions now. Traders and shorter term investors should be considering taking profits sooner.

Even though the Dollar Rules consider overbought levels (60+) on this index a point to lighten up on stocks)

Key to chart – Zero  is roughly  neutral and roughly when you approach to @ +60 you are overbought and approaching -60 you are oversold . Buy at oversold and sell at overbought. Nothing is absolute in this chart. In fact using the moving averages as a central point is better than using zero. Nothing is absolute about the minus or plus 60 number either.

Oversold conditions = buy, Overbought positions = sell

Positions

The  Positions Section (top of blog) to see all the latest buys and sells

Sorry have not had a chance to update Positions section in well over a week – see past updates

Investors

Comments – NOT the time to buy or add to recommended positions. (FXI, EWZ, GLD )  Enjoy the rally. Shorter term investors may want to sell part of the 3 major positions while they are at highs.

Traders (short term plays) These are not ETFs, but individual stocks

Long Term Outlook – The dollar looks like it may break down through major support and the benchmark S&P 500 is on the verge of a yearly high – Outlook will change to CAUTIOUSLY BULLISH if/when this happens. But subject to further change back to neutral since breakout was weak.

Long Term Outlook = CAUTIOUSLY BULLISH

Germany and Jobs

Berlin Wall Falls

The jobless rate fell again in Germany from 8.3% to 8.0% in Sept, then to 7.7% last month. LINK (World News Network which carries this story is a good source for news outside the USA.)

What does Europe’s biggest economy do right beside provide health care for all its citizens? Nobel Prize winner Paul Krugman points out some obvious differences in our economic systems. Basically, Germany has a more regulated free market/capitalist system. They take care of their workers. The rebound from recession is also evidence that outside the USA other countries (especially emerging markets) are recovering faster than ours. LINK

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage %	Volume
Dow	-0.91%	up
NASDQ	-0.83%	up
S&P500	-1.03%	flat
Russell2000	-2.09%	-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

• Brown = repeat statements
• Green = usually bullish statements
• Red = Usually bearish statements

Technicals, Fundamentals & Analysis

Dollar rose  a very significant +0.78 so stocks fell. The inverse relationship between the dollar and stocks is so strong it is easily the dominating factor in movement of equities.

List of best performing stock markets this year by country from Seeking Alpha – LINK

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI - The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI is @ 7% off its high (early June) Before that it gained almost over + 630% from its all time low of 663 in Dec. of 2008 (April 2009 high of 4291 )

The BDI rose a VERY significant +206 points yesterday and closed at 3954. Up 12 days in a row. DANGER – This index is going parabolic – up too far too fast – building a bubble. A higher high price on its chart pattern has been confirmed The BDI has rallied about 1800 points since late September. =  Bullish for stocks & world trade right now. Especially good for our positions in FXI & EWZ

——-

The Dollar is currently the #1 forecasting tool .

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

Mantra – Dollar up = US stocks down & Dollar down = US stocks up

US dollar was rose a VERY significant  +0.72% yesterday. The dollar closed at $75.68 . “ Usually a major support level at least temporarily halts any fall.” The $75 support level held and now the dollar is in the middle of its range.

The next important resistance level for the dollar is the falling 50 day moving average (blue line on chart). This is at $76.25 this AM . The support level is a little below $75.00 . Both are EXTREMELY important lines in the sand. A breakout on either side will move US equities in the other direction and the world will follow.

——-

$NYMO The NY Stock Exchange McCellan (EOD) Index measures how much the NYSE is oversold or overbought .

The index closed at -17.81, down 207% – If you look at the chart – once major momentum starts in one direction it usually continues. If stocks and this index close down  below  25/30  today the trend should continue until we reach oversold levels – below 60. (note -207% is significant,but not as big as it looks)

Key to chart – Zero  is roughly  neutral and when you approach to @ +60 you are overbought and approaching-60 you are oversold . Buy at oversold and sell at overbought. Nothing is absolute in this chart. In fact using the moving averages as a central point is better than using zero. Nothing is absolute about the minus or plus 60 number either.

Oversold conditions = buy Overbought positions = sell

Positions

The  Positions Section (top of blog) to see all the latest buys and sells

Sorry have not had a chance to update Positions section in over a week

Investors

Comments – NOT the time to buy or add to recommended positions. (FXI, EWZ, GLD)  Enjoy the rally. Shorter term investors may want to sell part of the 3 major positions while they are at highs.

Going to add Indonesia & Vietnam ETF’s – but waiting for dips. Also going to add DGP (this ETF does about 2x what the GLD does) – More explanation later. As a trade like GS. Again, waiting for dips

Traders (short term plays) These are not ETFs, but individual stocks

Extra Note of Caution here – Even though I always warn you AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING! please note I’m far less confident in individual stock picks

CSCO – (5% of portfolio) Flat since we bought position a few weeks ago . – Going nowhere while markets have moved higher.  Selling soon for @ -1% loss – Hopefully into a rally. Sold 1/2 CSCO two days ago and the rest yesterday for -1 to 2% loss. Position CLOSED

Long Term Outlook – The dollar looks like it may break down through major support and the benchmark S&P 500 is on the verge of a yearly high – Outlook will change to CAUTIOUSLY BULLISH if/when this happens. Instituted change yesterday , but subject to further change back to neutral since breakout was weak.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

Afghanistan

US ambassador, former general/commander in Afghanistan, Karl Eikenberry , has “deep reservations ” about sending more troops to Afghanistan. His major objection is corruption in a country’s whose #1 economic product is opium. LINK & LINK

Finally a major columnist has drawn a comparison between spending money on heath care vs. spending money in Afghanistan . NTY’s Nicholas Kristof argues -  are we “better off spending that money blowing up things in Helmand Province or building up things in America.” LINK Lack of health car kills about 45,000 Americans a year and the Taliban in Afghanistan have not exported their violence to the USA.

Sherwehe points out in comments section of the blog LINK 2,200 0f those are veterans who lacked health care according to a Harvard study. If the current figures hold up “This year more veterans will die from suicide than will die on the battle field.” and “800,000 vets live on the street. “

As pointed out before the major problem is Pakistan – 5/6 time the population of Afghanistan and a nuclear power. According to polls and DAWN (leading English speaking Pakistan paper LINK ) views of Americans are deteriorating rapidly.

Bottom Line – We simply can no longer afford to keep nation build around the world. Investors should note this is just another reason to invest in countries that are focused on building their middle classes instead of nation building opium rich country’s like Afghanistan.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage %	Volume
Dow	+0.43%	down
NASDQ	+0.74%	down
S&P500	+0.50%	down
Russell2000	+0.98%	-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

• Brown = repeat statements
• Green = usually bullish statements
• Red = Usually bearish statements

Technicals, Fundamentals & Analysis

Dollar rose an anemic +0.07% , & US equities actually managed a minor rally in anemic volume.

The BDI is on fire. (see below) This is very positive for world trade, commodities, and an indicator China is buying.  In the OVERVIEW section of the blog PEAK OIL is mentioned as one mega trend impacting economics and stocks. You might consider peak oil as subset of commodities . As world population and middle classes in emerging markets grow the finite amount of commodities become more expensive.

Patten developing – On Thursday market’s fall in expectation of weekly jobless number and stocks rise on Monday – because of some merger.

The longer the dollar holds above its support level the stronger support becomes.

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI - The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI is @ 13% off its high (early June) Before that it gained almost over + 630% from its all time low of 663 in Dec. of 2008 (April 2009 high of 4291 )

The BDI rose a VERY significant +133 points yesterday and closed at 3748. Up 11 days in a row. A higher high price on its chart pattern has been confirmed The BDI has rallied about 1600 points since late September. =  Bullish for stocks & world trade right now. Especially good for our positions in FXI & EWZ

——-

The Dollar is currently the #1 forecasting tool .

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

Mantra – Dollar up = US stocks down & Dollar down = US stocks up

US dollar was basically flat +0.07% yesterday. The dollar closed at $75.10 .  This is directly above its, line in the sand, support level. As predicted yesterday – “ Usually a major support level at least temporarily halts any fall.”

The next important resistance level for the dollar is the falling 50 day moving average (blue line on chart). This is at $76.32 this AM . The support level is  a t @$75.00 Both are important lines in the sand. A breakout on either side will move US equities in the other direction and the world will follow.

——-

$NYMO The NY Stock Exchange McCellan (EOD) Index measures how much the NYSE is oversold or overbought .

The index closed at +16.70, – Not yet oversold, but moving in this direction,

Key to chart – 0 is roughly  neutral and when you get to @ +60 you are overbought and approaching -60 you are oversold. Buy at oversold and sell at overbought. Nothing is absolute in this chart. In fact using the moving averages as a central point is better than using zero. Nothing is absolute about the minus or plus 60 number either.

Oversold conditions = buy

Overbought positions = sell

Positions

The  Positions Section (top of blog) to see all the latest buys and sells

Sorry have not had a chance to update Positions section in over a week

Investors

FXI – China – (now 25% of portfolio) At new high – up over 50+% this year

EWZ- Brazil – (now 20% of portfolio) At new high – up over 100+% this yea r

GLD (now 11% of portfolio) At new high – up over 20+% this year

Comments – NOT the time to buy or add to these positions.  Enjoy the rally.

Going to add Indonesia & Vietnam ETF’s – but waiting for dips. Also going to add DGP (this ETF does about 2x what the GLD does) – More explanation later. As a trade like GS. Again, waiting for dips

Traders (short term plays) These are not ETFs, but individual stocks

Extra Note of Caution here – Even though I always warn you AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING! please note I’m far less confident in individual stock picks

NVS – (5% of portfolio)  We’ve already sold 1/2 of this for +12% gain  Now up 16+% since bought

CSCO – (5% of portfolio) Flat since we bought position a few weeks ago . – Going nowhere while markets have moved higher.  Selling soon for @ -1% loss – Hopefully into a rally. Sold 1/2 yesterday for -1% loss

AMZN – (now 5% of portfolio  ) Bought last Wednesday – Sold 1/2  for 11% gain . Like NVS letting the rest ride .

Long Term Outlook – The dollar looks like it may break down through major support and the benchmark S&P 500 is on the verge of a yearly high – Outlook will change to CAUTIOUSLY BULLISH if/when this happens. Instituted change, but subject to change

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

Obama at Ft Hood

Photo from The Atlantic

On the eve of Veteran’s day Obama gave perhaps his most remarkable speech ever eulogizing those who died at Ft. Hood. You may disagree with his views, strategy or outlook , but the commander in chief’s address to a grieving nation and families of the fallen soldiers really resonates. LINK to video

Anything else seems trivial to write about on Veteran’s day.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage %	Volume
Dow	+0.20%	down
NASDQ	-0.14%	flat
S&P500	-0.01%	down
Russell2000	-0.91%	-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

• Brown = repeat statements
• Green = usually bullish statements
• Red = Usually bearish statements

Technicals, Fundamentals & Analysis

Dollar fell an anemic -o.o3% so US equities went nowhere in anemic volume.

Besides the Dollar siting directly above a major technical support level, 3 of the 4  major US indexes are right below major resistance areas and even oil is at a key $80 resistance level.  Across the board there is technically strong support for the rally stalling.

The BDI (measures trading costs – see below) is on fire (very bullish) Prices to ship commodities are growing. If you see a breakout in stocks it could come from this area. A second possibility is financials (shadow banks) that have dropped recently.

If US stocks were overbought ( see McClellan indicator below)  would be selling  some of position in EWZ and FXI now) Right now we are just  slightly overbought. There’s room for a rally and the dollar is falling too fast. Short term-Momentum with BULLS

Still holding to this week’s original forecast that ” we hang on (stock prices go flat) for a while but dollar falls and stocks rise. ”

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI - The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI is @ 16% off its high (early June) Before that it gained almost over + 630% from its all time low of 663 in Dec. of 2008 (April 2009 high of 4291 )

The BDI rose a VERY significant +135 points yesterday and closed at 3615. We look to be starting another major move higher. A higher high price on its chart pattern has been confirmed The BDI has rallied about 1500 points since late September. =  Bullish for stocks & world trade right now. Especially good for our positions in FXI & EWZ

——-

The Dollar is currently the #1 forecasting tool .

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

Mantra – Dollar up = US stocks down & Dollar down = US stocks up

US dollar was basically flat -0.03% yesterday. The dollar closed at $75.04 .  This is directly above its, line in the sand, support level. As predicted yesterday – “ Usually a major support level at least temporarily halts any fall.”

From last week – The next important resistance level for the dollar is the falling 50 day moving average (blue line on chart). This is at $75.04 this AM . The support level is a t @$75.00 Both are important lines in the sand. A breakout on either side will move US equities in the other direction and the world will follow.

——-

$NYMO The NY Stock Exchange McCellan (EOD) Index measures how much the NYSE is oversold or overbought .

Key to chart – 0 is roughly  neutral and when you get to @ +60 you are overbought and approaching -60 you are oversold. Buy at oversold and sell at overbought. Nothing is absolute in this chart. In fact using the moving averages as a central point is better than using zero. Nothing is absolute about the minus or plus 60 number either.

Positions

The  Positions Section (top of blog) to see all the latest buys and sells

Sorry have not had a chance to update Positions section in over a week

Investors

FXI – China – (now 25% of portfolio) At new high – up over 50+% this year

EWZ- Brazil – (now 20% of portfolio) At new high – up over 100+% this yea r

GLD (now 11% of portfolio) At new high – up over 20+% this year

Comments – NOT the time to buy or add to these positions.  Enjoy the rally.

Going to add Indonesia & Vietnam ETF’s – but waiting for dips. Also going to add DGP (this ETF does about 2x what the GLD does) – More explanation later. As a trade like GS

Traders (short term plays) These are not ETFs, but individual stocks

Extra Note of Caution here – Even though I always warn you AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING! please note I’m far less confident in individual stock picks

NVS – (5% of portfolio)  We’ve already sold 1/2 of this for +12% gain  Now up 16+% since bought

CSCO – (5% of portfolio) Flat since we bought position a few weeks ago . – Going nowhere while markets have moved higher.  Selling soon for @ -2% loss – Hopefully into a rally.

AMZN – (now 5% of portfolio  ) Bought last Wednesday – Sold 1/2 yesterday for 11% gain . Like NVS letting the rest ride.

Long Term Outlook – The dollar looks like it may break down through major support and the benchmark S&P 500 is on the verge of a yearly high – Outlook will change to CAUTIOUSLY BULLISH if/when this happens.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!