Investors 411 Blog

by Barr Jozwicki
July 6, 2012

Another Mega Scandal

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

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Another Mega

International Scandal

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Another Major

Preventable Catastrophe

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Involving collusion between

a corporate cartell and the

politicians/regulators

they own

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HEADLINE

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“A scathing Japanese parliamentary report

investigating the circumstances of the

Fukushima Daiichi nuclear-plant disaster

blamed the dangerous incident on

collusion between government agencies

and Japan’s leading energy company”

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LINK to TIME Magazine story

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Millions of Lives negatively Imacted

Trillions in overall economic costs

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The technology did not fail,

but just as with the Bankstas

who brought the world to the

edge of economic collapse in 2008

and are still creating the same

too big to fail havoc today

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Its the GREED of the plutocracy

Skimming all the profits and

punishing us with their disaster

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Thanks to EW and Popeye [LINK to his comment] for bring this up in the comments section and our thought go out to JSs son who, like Godzilla (see cartoon above) got out of town (Japan) but is back living there.

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STOCKS

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Paul,

who is trying to stay cool

at a very hot art show,

has posted the latest results

of  the current YOUR Stock List

LINK Here

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YSL +0.26

S&P 500 -2.17

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Long Term Outlook

3+ months

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NEUTRAL

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AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK & POTENTIAL LOSS OF PRINCIPLE

CHECK ALL DATA, I MAKE MORE THAN GRAMMAR  ERRORS

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March 28, 2012

The Mt Everest of Cash

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

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Ask Your Conservative

Friends

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The Follow Up

Jobs Question on…

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The Mt. Everest of Cash

Businessman climbing on money vector

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Apple Computer.

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Apple  was sitting on

The Mt. Everest of Cash.

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They will be lavishing on wealthy investors 10′s of billions in  dividends and stock buy backs.

Making the already rich 1% even richer [Richest 1% in USA had 93% of the income gains in 2010- See yesterday's blog]

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What Apple Could Have Done?

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  • Launched a huge expansion in Research and Development – Creating Jobs
  • Launched a Program with American Universities to help train workers for Apple Jobs
  • Launched a Program with American Government to help train workers for Apple Jobs
  • A spectacular PR move that uses of 1/10 of that Mt Everest of cash to help Americans.

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WHY IS IT THAT

CONSERVATIVES BELIEVE

MOST AMERICAN WORKERS

ARE LAZY

RATHER THAN MOST

OF THE WEALTHIEST

1% OF AMERICANS

ARE GREEDY?

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STOCKS

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Wall Street Bull and OWS Symbol

..

Insight into how Investors411 evaluates stocks, markets and trends can be found in the STRATEGY Section of the blog.

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Nothing’s Changed,

Same Headline

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Investors411 Beats The Drums for

The Fed’s (Central Banks) Has You’re Back

Every analyst out there has called for a correction over the last three months. Obviously the longer the rally goes on the more the “experts” call for a correction.

It will happen when it happens

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How big a correction, will be decided

by Central Banks

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Old Faithful

The McCellan Oscillator

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  • Our #1 technical forecasting tool, the McClellan Oscillator (MO) rose to -11.68. (for more see  STRATEGY link at top of blog and scroll down) MO now = NEUTRAL

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______________

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Swimming With Sharks

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Why Stocks Rally

Another Example

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AAPL reached another all time high closing high yesterday. Apple could have used its Mt. Everest of cash on reseach and develpment, thereby insuring more organic growth over the long term.

Instead they now offer a healthy dividend and stock buy back for mostly wealthy shareholders.

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Why This Creates a

Short term Rally

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APPL has moved from over bought to OMG over bought for three months. Amazing all who have called for its downfall.

What the dividend/buy back program does is open AAPL to a whole new class of VALUE investors, who would not have otherwise bought Apple.

All those who chase momentum in stocks now know there’s a fresh supply of investors in waiting to buy. So they too buy the dips.

.

So for a while APPL will move higher

on the new supply of investors

NOT future Organic Growth.

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Paul’s Corner

While the indexes suggest a never ending rally, there are hints the market is stalling. Otay, understand? Keeping this in mind, here are what our charts look like.

TRADERS

CMG – Continues its march up, this is the kind of tight chart you want a stock to have. The angle of the chart has turned up indicating a wee bit of extension  and the buying has accelerated. Buy any dip.

DLTR – great chart, continues toward the BIG dollar in the sky!  Buy any dip.

ENB – Basing, sitting on the 50

FAST – good chart, buy any dip

FL – nice gap up two days ago, buy any dip

HD – excellent tight chart, buy any dip

IBM – the old dog hit’s a 52 week high, proof you don’t kick out an old dog unless it starts smelling. Buy any dip. 1.4% dividend

IMAX – HGSI indicators have turned red, two red/down Kahuna’s the past few days, sitting below lower Bollinger Band, needs to cross up through the middle BB (25.74) before a buy is “safe”.

KLAC – nice break out of a short handle/base, buy any dip.

LEN – great earnings report, gapped up yesterday, buy any pull back.

MA – broke out of a month long base, buy any dip.

MNST – what a monster of a chart, buy any dip!

RYL – sitting above the 50, LEN has a better chart.

TSCO – broke out of a 3 month base, buy any dip.

URI – basing, sitting on the 17, and personally driving me nuts. Subject to the whims of the “housing market”

WATCHERS

AKRX – sitting above the 50 and 17, basing, HGSI indicators are red.

BKI – HGSI indicators green, sitting above the 50/17, two blue/up Kahuna’s past few days, buyable

KOG – basing, above the 50, below the 17

SWI – broke out of  nice 2 month base, all indicators green, good 13 day Force, other similar Software stocks are doing well. Buy any dip.  Expect to add this stock to the traders.

DUMPSTERS

SIMO – chart suggests not buyable

CATM – chart broke down through the 50, HGSI indicators red, not buyable.

FTK – buy at your own risk.

Be sure to check earnings release dates, that’s your responsibility not mine!

Disclaimer – all comments for education only, buy or trade at your own risk. At time of writing I do own some of the stocks listed.


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Longer Term Outlook

3 months+

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Still

CAUTIOUSLY BULLISH

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AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

CHECK ALL DATA, I MAKE MORE THAN GRAMMAR  ERRORS.


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February 27, 2012

Greed

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

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GREED

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The Vampire Bankstas

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In Vegas you need to have actual money to gamble – your own money – You win lose or draw.

What Banksta greed has done since  deregulation  was…

  • take YOUR money, and gamble with it
  • with NO requirement or significant risk to their money
  • and over leverage themselves on opaque derivative/credit default swaps markets

You’ve seen the consequences and now its time for…


The Bankstas Cover Up

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Back before banks were deregulated, a special group of banks that met our Central Bank’s requirements were given special legal privileges and access to taxpayer money.

They could borrow money from the Fed for almost nothing and then lend it right back to the Fed at a higher interest rate – say 3%.

This actually helped money flow through the system.

But after the 2008 meltdown and the banks got soooooooo over leveraged they needed truck loads of money to cover old losses and new (think European debt) So Central banks printed and printed and printed money and loaned it out to their member banks.

How much money was printed for Bankstas?

The Fed (our central bank) balance sheet on 2/22 stood at $2,917,435,000,000 &

the ECB (Europes Central Bank) balance sheet stood at $3,550,000,000,000 on 1/1/12

$6,500,000,000,000

to keep their too big to fail

unregulated Casino open

Tomorrow – Solutions.

Much of this 6 part series was inspired by Dylan Ratigan’s book Greedy Bastards.

Link to Chart/Timeline of Banksta Takeover

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STOCKS

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Wall Street Bull & OWS Symbol

We’re still in the CAUTIOUSLY BULLISH sweet spot, but there are dark clouds on the horizon.


  • Sweet Spot Mantra - “INVESTORS411 has not changed its long term outlook, because this is a manipulated market. Our Central bank  has backed American banks since 2009 and the European Central Banks is now backing their Banks in the same way – by basically printing money and holding interest rates near zero.”
  • Therefore - “Anyone who wants a return on their $ greater than near 0% is pushed into assets that the ECB and Fed is manipulating higher. Our economy either gets better or the Fed has our back”

The Dark Clouds/Oil Prices


This is now one obvious call that Investors411 first warned about on 1/6/12 and 1/17/12

Suggested ETFs for oil – USO (1 x oil prices) & UCO (2 x oil prices)

If you bought UCO on Jan. 17th you are now up

+20%

The primary fear behind this rise in oil prices is the threat of war between Israel and Iran.

Intrade, now puts the possibility of an overt air strike against by US or Iran by Dec 2012 at 42.5%.

  • This is political season and fear mongering is what the far right does best.
  • The current PM of Israel is extremely right wing and visits USA on March 5th.
  • Yes this is exactly what happened in Iraq.

Obama – on oil prices

Oil prices have gone up 9 days in a row and 12 of the last 13 days. By most all accounts overbought territory.

However, if you have lots of long positions, you should still think about some protection or taking some profits.

—————-

  • Our #1 technical forecasting tool, the McCellan Oscillator (MO) is at -6.88. 50 Day Moving Average at +20.20 (for more see  STRATEGY link at top of blog and scroll down) Lots of wiggle room for bears and bulls = NEUTRAL

  • The European canary in a coal mine is chirping. But focus is going to be drawn more on Israel/Iran because of the Israel PM visit and politics.
  • Italian 10 year bond yield at 5.45% (8:30 EST) - No where near the danger zone of 7.0% of almost a month ago.

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Paul’s Corner

SIMO is being dropped from Your Stock List due to chart action.  The Semi Group has been doing well but SIMO broke down and hasn’t been following the group. It’s a maker of flash drives and will be watched for possible adding back to the list.

SWI is being moved from the Watchers section up to the Traders section.  SolarWinds, Inc. designs, develops, markets, sells, and supports enterprise information technology (IT) infrastructure management software to IT professionals. SWI and old member of a previous list is showing good chart action and may give us a good run.

Kudos to Ian Woodward!

You have heard me speak often about the HGS Investors group and Ian Woodward in particular. Ian is an inspiration to all that are lucky enough to come into contact with him. John Bollinger, the creator of the Bollinger bands concept, had some kind words for Ian when he was interviewed in the upcoming March issue of “Technical Analysis of Stocks and Commodities”. Here is what Bollinger says in part:

“A little more than two years ago, I had the pleasure of spending time with Ian Woodward, who has been doing some interesting things with Bollinger Bands.  It was an inspiring time for me.”

“Ian Woodward is an amazing guy….A couple of years back, a mutual friend arranged for Ian to drop by and show me the work he was doing, and I was very impressed.  Here was a man nearly XXX years old (true age redacted!!!) with more ideas and energy than most people half his age.  He has taken input from William O’Neil, Richard Arms and me and crafted an approach to investing that seeks to identify and participate in high-growth stocks.  He gives three day seminars twice a year that are jam-packed with interesting ideas.   I even had one of the guys who works for me attend.  I think that in the fullness of time he’ll be known as one of the great analysts.”

Ian’s next work shop is in a month if you are serious about investing you should attend!

http://www.highgrowthstock.com/Seminars/seminars.htm

European Markets are down, our futures are down, have we seen the top? Be careful!

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Longer Term Outlook

3 months+

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Still

CAUTIOUSLY BULLISH

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AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

CHECK ALL DATA, I MAKE MORE THAN GRAMMAR  ERRORS.

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December 14, 2011

Jonas Salk’s Gift

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

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Jonas Salk’s Gift


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Yankee Bob (Conclusion from Monday’s Editorial)


It was easier in the 60′s. The End the war hippy dippy back to the earth  Counter culture became the dominant narrative.

The counterculture said to popular culture’ Hey, your institutions told me to love one another, how can you send me around the world to kill people I have no quarrel with? How can you send me to kill yellow or brown people in the name of freedom and liberty and then discriminate against people of color  at home ??? Counter culture simply held the mirror up to society’s face and cried

“Hypocrisy”.

We have to do that again! Society has to function for the greater good of many not just for the greed of a few. There is no doubt about the need for social change and social justice. There is no doubt that our political institutions are dominated by greedy corporate interests. Change will have to come from the ground up and not imposed from the top down.

We are many. The greedy are few. I hope. Can you imagine someone tomorrow announcing that they have a cure for HIV and AIDS and that they are making a gift of it to the world?? The  Talmud commands that we not shall stand idle our neighbors blood or suffering.

Our leaders like Obama are disappointing. Our Religious Institutions are too busy worrying about Gays and defending their pedophiles to be a force for social justice.

I think we have to organize from the ground up. Unions probably offer an effective vanguard for social justice. The Occupy Movement does too  in the sense that at least it is a demand for social justice.

Yankee Bob

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STOCKS

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Europe still has Significant Influence over US Stocks

Depressing Paul Krugman Editorial on Europe & Depression


Economic Overview


Economically we have a broken opaque worldwide shadow financial system.

No surprise conclusion for Investors411 readers.

When you look out over years this system is unsustainable. We face a very real rise in increased nationalism and trade wars. Any significant disintegration of  the European Union would be a disaster, as would a trade war with China. These are both very possible realities.

The world is running on etherial money – Credit Default Swaps/Derivatives (“Financial WMD’s” – Warren Buffett) Over leveraged, thinly regulated shadow banks proliferate.

Politicians are like magicians who divert you from the reality of what’s happening. Our too big to fail financial system is broken. Our formerly democratic government has become a tool for major corporations to privatize the profits for themselves and socialize the risk to the vanishing  individual middle class taxpayers. (see yesterday’s George Norboe editorial for more)


Company Profits vs Taxes Paid vs Lobbyists Paid

[See latest chart below]


Short term major companies are sitting on a mountain of cash to prop up their stock prices. The Fed is manipulating behind the curtain using its printing press to keep world economies afloat. It works for now, especially for the larger companies and stock prices.

The BUT is sooner or later you run out of fingers to put in the leaking dike.


SOURCE


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Strong correlation between Europe and US stock opening price

Germany’s DAX down 0.72% at 6:15 AM EST

DAX down 0.90% at 8:50    AM EST

Even better indicator is the Italian 10 year bond Price. Italy is the biggest European country in trouble and a yield of 7.0% has forced other European countries into “controlled bankruptcies.”

Italian 10 year bond up slightly at 6.69% at 6:20 AM EST

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Reading The Tea Leaves

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Our #1 technical forecasting tool, the McCellan Oscillator fell  to -36.02 . 50DMA at +11.59 = NEUTRAL/bullish

The S&P 500′s 200 DMA is proving to be a strong resistance level for US equities.

Technically, the resistance level of the S&P has held and the bulls are in retreat. Fundamentally, the Fed announcement yesterday offered no new public help. Both signs are BEARISH

Shorter term Outlook (week)

  • The Santa Clause/end of year selling pressure will have a positive impact. – Maybe NOT positive enough to turn stocks.
  • Key technical guide, and it has been very accurate throughout this cycle, is the MO
  • We have just started to enter moderately oversold territory (-30) We hit @-140 in early Aug & @-105 in late Nov.
  • Therefore,  there is a ways to go ( -36 to -105 = 69 points) before  we get any kind of solid reversal area.

So not expecting any technical help in the short term. Any reversal is going to have to come from some major change in fundamentals.

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Paul’s Corner

3.24% YSL 7 vs. 2.56% S&P 500

Wow a nasty sell off into the close yesterday. As Ron Brown suggested in his morning report this is a very risky market. Most of the YSL 7 stocks are performing well, even in the daily market yo-yo actions. The following chart shows current group performance.

Chart Link:

SIMO was recently added to the Nasdaq 400 and 500.

LINK

Ron Brown HGSI had a great Weekend Report this past Saturday where he discussed Wolf Packs of stocks, i.e. stocks tend to run in groups and how to find them.

LINK

FTK has done well these past few weeks and it has approximately 6 days of short interest. Will you enjoy the short squeeze?

Jeffrey Scott, an HGSI user, had a great webinar last Wednesday evening. He gave a cooks tour of using HGSI and the ferreted out some great stocks.  The webinar is available for download. If you have ever wondered what HGSI can do, this video will show you.

LINK

The file is a zip file and includes the video and the power points. It’s a big file and you need high speed access.

Quite a few buy the dip opportunities these past few days giving a chance to ease into positions. Please review our Buy the Dip guidelines:

LINK

This is still a risky market to trade, please keep it in mind.

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Current Positions

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Strategy – Buy the Dip of trending sector/stock

Paul’s tutorial on Buying the Dip

Your Stock List #7 [YSL #7] is out and Paul has been updating it in the comment section of the blog. – Some excellent choices here.

SSO - (ETF that is @ 2X long the S&P 500) Bought, on dip at 46.20. A 5% stop loss order on this stock. Sadly our -5% stop/loss order was hit yesterday at 44.90. Sold for -5% loss

USO - (Oil ETF and UCO 2x oil) under consideration on dips.

All of Your Stock List #7 with links to charts may now be found  in the Positions Section of blog. (Scroll down)

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Longer Term Outlook

3 months

Fundamentals behind the LTO -

The Fed has seemingly committed to do whatever it takes to hold things together, from US equities to the European Union. Over the last few years our Fed has been a successful major manipulator of US equities -higher. Working with allies it is attempting to do the same on a global scale.

The Fed’s manipulations do NOT fix the root cause of our over leveraged opaque financial system. They, at best, offer a temporary solution to keep stocks afloat.

Basic fundamental is still Don’t Fight the Fed. However, the Fed’s actions/manipulations are often not transparent. So when the the public announcement after the Fed meeting shows no change markets get spooked. Therefore downgrade to

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NEUTRAL

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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 GRAMMAR  ERRORS.

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December 12, 2011

The Age of Greed

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

The Age of Greed


Dr Jonas Salk

By Yankee Bob


Back in our youth their was a very real threat to our well being from Polio. Polio was, as you know, a major killer and a debilitating disease that could have stricken any of  us at any time. Research money poured in to find the cure.

Dr. Jonas Salk did find the cure for this disease that was a bigger deal back in the 50′s then AIDS is now. Why do I mention it? Dr Salk found the cure for this major health problem and he donated it to the world as a simple act of human kindness. He felt his salary as a researcher and teacher was enough for him.

The man that could have made millions maybe even billions from his break thru did ...gave it to the world as a gift.

Can you see this happening today in this age of greed.????

Corporations are busy patenting all their research on human and plant genes. Break thrus and treatments will not be given away. This is an age of greed. Greed institutionalized by corporations. Society be damned! Corporate greed overrides human need and the political system has been overtaken from this greed.

The immediate problem is how to change the ethics when corporations have a choke hold on media. The telling of the narrative,the very image of reality presented by corporate media has to be challenged and changed…

Conclusion Tomorrow

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Great  Videos

Several of you have recently sent in some videos that are Just plane fun, have some significance or both. Keep them coming. Here’s a couple that you all will enjoy.


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STOCKS

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Europe still has Significant Influence over US Stocks


Although there are some significant analysts out their like Jim Cramer (ex Goldman Sachs executive) who believe that we got some short term stability out of the European Summit and the US should be focused on what happens here this week. The other side has a good longer term argument, despite Friday’s rally.

Friday’s low volume rally is typical of the manipulated markets we saw as our Fed flooded the USA with liquidity (QE #1, QE #2 and other less transparent measures)

The longer term problem lies in the enforced austerity of poorer European countries which is sold as they pay or the richer countries taxpayers will pay. It’s a problem is imbedded in the German and the worldwide Bankster financial system that allows phony capitalism and those troubled European bonds to bring financial Armageddon.

Remember, just like in 2008, the now threatened bonds were bought because they could be repackaged and sold as derivatives, This over leveraging in an opaque CDS system (CDS = Warren Buffet’s term Weapons of Financial Destruction) still thrives.

There are several decent editorial out there. A solid editorial by Mohamed El Erian LINK. The best I found was from The Atlantic and it may make your eyes glass over, because its technical – Here’s the LINK and here’s the money line in  Clive Crook’s editorial.

Germany’s demands are bad finance, bad fiscal policy, and bad constitutional design. You don’t fix this mess by ruling out forceful action until closer integration has been achieved. You don’t repair Europe’s underlying political dysfunction by increasing the distance between government and governed.

Bottom Line - Investors411 does NOT see as rosy picture as Cramer presents.

_________


Strong correlation between Europe and US stock opening price

Germany’s DAX down 1.81% at 6:15 AM EST

DAX down - 1.96% at 8:22 AM EST

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Reading The Tea Leaves

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Our #1 technical forecasting tool, the McCellan Oscillator fell slightly to +16,80. 50DMA at +11.22 = NEUTRAL

The S&P 500′s 200 DMA is proving to be a strong resistance level for US equities.

See chart at right top of blog. We have failed to significantly crack this level for 5 days. The longer we fail to crack this level significantly, the stronger it gets. We are back just below breakout levels.

Market cheerleaders are hyping that the Italian short term bond rate today fell below 6% (7% is danger level)

  • News from Europe is still a trump card.
  • Other big event of week is the Fed meets this week.

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Current Positions

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Strategy – Buy the Dip of trending sector/stock

Paul’s tutorial on Buying the Dip

Your Stock List #7 [YSL #7] is out and Paul has been updating it in the comment section of the blog. – Some excellent choices here.

SSO - (ETF that is @ 2X long the S&P 500) Bought, on dip at 46.20. A 5% stop loss order on this stock.

USO - (Oil ETF and UCO 2x oil) under consideration on dips.

All of Your Stock List #7 with links to charts may now be found  in the Positions Section of blog. (Scroll down)


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Longer Term Outlook

3 months

Fundamentals behind the LTO -

The Fed has seemingly committed to do whatever it takes to hold things together. From US equities to the European Union. Over the last few years our Fed has been a successful major manipulator of US equities -higher. Working with allies it is attempting to do the same on a global scale.

The Fed’s manipulations do NOT fix the root cause of our over leveraged opaque financial system. They, at best, offer a temporary solution to keep stocks afloat.

The Fed’s manipulations are also less transparent then before (example QE #1 & 2). Therefore market direction is that much more difficult to call. The CAUTIOUSLY BULISH Outlook is hanging on by the skin of its teeth -

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CAUTIOUSLY BULLISH

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NB – The LTO has been reduced to 3 months. Even 3 months is a stretch. Basic fundamental is Don’t Fight the Fed.But the Fed’s actions/manipulations are not transparent.

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 GRAMMAR  ERRORS.

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April 18, 2010

America’s Back

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

“The Comeback Country.”

America’s Back - Is the front cover headline from April 19th’ Newsweek.

The stock market chart below sure shows the US stock market is back. This issue of Investors411 is going to go over why stocks NOT the economy (a different story although since Obama took office we have gone from -700,000 jobs to +100,000 jobs a month) have recovered and one major point on technical analysis

DougShortStockMarket

LINK to bigger representation of above chart by dshort.com

CAUTIONWhile this two year chart (we are the blue line) does look good if you take a 10 year perspective the chart shows that stocks are in the 3rd worse bear market. The US stock crash of 1929 and the 1989 Japan stock crash the other two worse bear markets.

Why Stocks Recovered

  1. The Paulson/Bernanke Bailout - You can also give credit to Bush, Obama, McCain, Geithner and every member of congress that voted for this flawed plan. We stood at the precipice of well over a dozen of the world’s largest banks, its largest insurance company all failing. This would have easily have cascaded us in panic into another Great Depression. Many many big foreign banks were also bailed out.
  2. Worldwide StimulusObama’s stimulus plan cut taxes @ 10%, kept state governments solvent, provided new jobs, new focus on alternative fuels, and gave tax breaks to small companies. You can argue the merits of the Obama plan vs. the other world wide stimulus plans, but combined they made a difference.
  3. Low Interest RatesOur Fed and other central banks cut interest rates dramatically and gave insolvent or near insolvent banks the money at close to 0%
  4. Changed Accounting procedures - We virtually eliminated “mark to market” accounting. This allowed banks to less transparency in accounting and not to value assets at what they are worth at the present time.
  5. Speed - Unlike the 1929 Great Depression and the 1989 Japanese stock crash, action was taken within a year to fix a worldwide economic problem.
  6. Emerging MarketsChina, India, Brazil and others never entered recession. Partly because their banks did NOT get over leveraged. Their economies kept right on growing.

This is all truly great news for Wall Street. Of course for every on Main Street this Simply Sucks

  1. We’ve privatized the Gains and Socialized the Risk - Untold trillions have gone into fixing our over leveraged, unregulated markets (shadow financials that caused the crisis). The government money printing presses (later this means you pay with inflation) and tax dollars (bigger deficits) have added new burdens on Main Street.
  2. We’ve done NOTHING to fix the problem. Alan Greenspan had his OMG moment in front of congress when he exclaimed he was wrong – “Free” (unregulated) market can not fix themselves.  There is something called GREED that emerges on Wall Street if you have little or no transparency and rules.  In fact, we’ve made things less transparent by removing mark to market accounting.

Technical Analysis

I love it that so many of you who have my personal email send in stocks for consideration on YOUR Stock List. Again Thanks – I will give you a short technical analysis of each stock. Two new stocks sent in over the weekend CKEC (3D theater stock,but over extended) & MSPD (chart looks great!) are worthy of consideration. One stock on YOUR list ICON “raised guidance”

One request - Almost all of you send me some stocks that  are too small to consider. These small companies are too easily manipulated by Wall Street Sharks. Please send in stocks that do over $5,000,000 a day in trades. More than that is even better. Multiply Volume X Price

Over two decades I’ve watched /owned way too many of these “thinly traded” stocks that exploded.

Here’s how they fall in an analysis of ERES – Chart shows @200,000 shares a day traded and price at $7.27 = @ $1.5 million a day.  Thats chump change to hedge funds, big investors, brokers, institutions.  Its too easy for them to “pump and dump”

Example-someone acquired 1,000,000 shares around 6 to 6.5. over time. They pumped up the stock by buying more shares as it comes close to its technical breakout point. Knowing other investors would then jump in as the stock broke out, they pump it up by buying more. ESRS goes higher and then they dump the million (plus say 50,000 to 100,00 extra shares it took to pump up the stock) ERES prices go down big time but they make a killing.

This obviously does not mean ERES is getting pumped then will be dumped. But the lower the volume & price the greater the potential for manipuation

Don’t worry if the above explanation makes your eyes glaze over. Just stay away from thinly traded companies.

AS ALWAYS DO YOUR OWN ANALYSIS BEFORE INVESTING


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February 23, 2010

Fear and Greed

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

Holder

At. Gen. Holder defends American Justice System

Fear and Greed

These are the two basic factors that move stock markets and a whole lot more.  Of course they sometimes go under other names- sex, survival, desire, risk etc. but we are manipulated by them. (see yesterday’s update)

Let’s take a look at some work done by two Israeli scientists in 1979 Kahneman and Tversky that show how we all miscalculate data when confronted with simple financial choices.

Group 1 was given $1000 Israeli pounds and given a

  1. 50% chance of winning an additional 1000 pounds – 16% chose this option
  2. 100% change of winning an additional 500 pounds – 84% chose this option

Group 2 was given $2000 Israeli and given a

  1. 50% chance of losing 1000 pounds - 69% chose this option
  2. 100% chance of losing 1000 pounds – 31% chose this option

In this and other experiments K&T showed a striking asymmetry. Fear (risk) of a financial loss was about 2 1/2 times greater impact than a simiar financial gain. FEAR WINS BIGTIME.

Bottom Line – From Investing to politics to anything involving human behavior, almost all of us succumb to this fear biasThe trick or path is to overcome this fear bias and you will get better results. Of course, there are other cognitive traps. (see yesterday’s pop quiz)

Justice System Nails Another Terrorist

The headline says it all. The American justice system worked and we bagged another terrorist yesterday.

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 -0.18% down
NASDQ -0.08% down
S&P 500 -0.10% down
Russell 2000- +0.10% -

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

Technicals, Fundamentals & Analysis

See PositionsStrategy , and Overview for changes made over weekend.

Low volume and nothing really happened. Technically, the longer we remain flat the greater the chances of a fall. Difficult short term call here – but it looks like a small correction then another push higher into oversold territory.

ETF’s- Selling a little (taking profits) into small rallies and more in BIG rally. Sold 1/3 of TYH yesterday at 139.00 for @ +18% profit. Still have 5% of portfolio position in TYH

Significant Indexes

  • McClellan Index fell to +46.16. Basically +60 = overbought and usually a time to sell or lighten up on positions. This is NOT a hard and fast rule but guideline. There has been a sharp fast change and a lot of upside momentum last week. So there is still psychologically a lot of positive momentum out there.

Positions

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

Mea Culpa – Should have added more to stock positions while McClellan Index was down at -60. Since stocks rallied dramatically last week so should any stocks we have on our watch list. Unless there was a special circumstance, these stocks should be outperforming the major US indexes.

Thanks to several of you who are sending in additional lists of prospective stocks. Have not had a chance to study them all yet, but will include them in future lists. Trying to keep list under a dozen stocks. This watch List comes from the stocks YOU send in. Tried to pick best of the ones you sent in. As stated before I’m more confident with ETF’s than stock picking. Since the McClellan Oscillator is close to +60, or overbought – buying now is more dangerous.

Last Update 2/11/10. Recommendations from 2/11 in black. New thoughts in violet

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

  • AAPL - Formed a double bottom trading pattern @ 190 - a buy the dip opportunity Now at 200, but showing danger of breaking down – May be dropped from list
  • CAAS Broke down though 50 day, but has some STRONG volume up days. A China play that will follow FXI. Tempting Lots of volume behind rally days and yesterday had big breakouthold if you own or buy the dip.
  • PCLN Fell below 50 day moving average. Formed a double bottom bullish trading pattern. A buy the dip opportunity Big earnings breakout – market leaderwished I had bought itNow wait for dip.
  • FOversold, and well down from highs. Has formed a base at 10.5  - a buy the dip opportunity – Flatlining or Forming a base
  • DRWI - Big exporter to China -  Sitting on 50 day MA support level  No big volume as stock dropped= good sign. Buy the dip . Weak volume behind move upMay be dropped from list
  • ENOC New – Reduces costs for utilities 50 day MA acting as support Potential buy the dip Breakdown
  • IMAX Great long term chart – Poor short term chart. Lower highs and lower lows  Investors411 has a 2% of portfolio position in this stock. Sell at least 1/2 into next rally. Now own 3% Due for correction - sell 1/2 into rally – buy on dip – or just hold if you’re a long term investor
  • GS, Often considered the #1 Shadow bank seems to have formed base at @ 150 Tempting. Up a bit but volume dropping Not Interested
  • CSCO, Techs new leader Moving up despite rocky market a by the dip Up, but tech not leading markets now – Better than AAPL – Not Interested
  • SHOO, Great long term chart. Pulled back and is forming a base. Would like to see a bigger base, but tempting Moved up to old high/resistance level - Needs breakout- Tempting
  • ICON, Did NOT form lower low over last two weeks as markets toasted a buy the dip Slow steady move higher with breakout yesterdayA buy the dip
  • VPRT Another stock that weathered recent pullback well a buy the dip Moved up to breakout level and pulled back yesterdayA buy the dip
  • DGIT Thinly traded, but potential winner – just broke above its 50 day MA a buy the Dip Had breakout in big volume and is now dipping - A buy the dip
  • CTCT Rebounding stock, has a of good volume up days has breakout potential Broke out and is in pullback- A little weaker than other choices, but buy the dip
  • VCI Good volume, good chart Somewhat overextended A buy the dip underway – Major breakout, then rallied more and yesterday big dropToo volatile for me

AnalysisNotice that the vast majority of these stocks moved higher as conditions of overall US equities went from oversold to (almost) overbought. Big lesson here is to buy when markets are OVERSOLD. YOU have chosen some pretty good stocks.

I’m familiar and use VPRT & PCLN. Plan to own them on dips hopefully sooner than later. Others that look decent on dips are CAAS, ICON, DGIT & CTCT

Caution – Markets are close to overbought

Will go over a few of the new stocks you have sent in later in week or early next week.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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January 20, 2010

A Frog In Hot Water

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

A Frog in Hot Water

The old adage goes – Throw a frog in hot water and he’ll jump right out, but you can slowly bring the water to a boil and that frog will stay put.

A little known Republican State Senator, Scott Brown , won a stunning upset victory in the MA Senate race last night. Like Mitt Romney in 2002, he beat  Dem. Shannon O’Brien, Brown toasted another woman who ran a weak campaign – Martha Coakly.  For perhaps the best analysis of what this means see Nate Silver’s Let’s Play The Blame Game

Health Care – Obviously in deep trouble. The only way Health Care would pass is if the House passes the Senate Bill. Since Democrats in the House have already voted for a far more progressive health care plan and will get hit for that in the next election Obama is going to argue why not vote for the Senate version.

Bottom Line – Health care. – You blew it – RIP

That Frog in this case is the typical American worker who is in the pot of ever increasing temperature .

  • Globalization is slowly eliminating working class jobs across America
  • Weapons budgets are growing at the rate of 10 to 20% each year
  • For the first time in our history we cut taxes and went to war.
  • Our federal and trade deficit exploded from 2000 to 2008.
  • The era of cheap oil is OVER. The supply has peaked and the demand from billions of people in emerging markets is growing.
  • Because of our suburban sprawl and relative lack of public transportation we are far more vulnerable to high oil prices.
  • Time tested solutions like stimulating the economy to fix it will not work as well because of our already huge deficit.
  • There fewer and fewer laws to govern excess GREED on Wall St. Main Street has socialized the risk for Wall Street
  • The rich in the USA are getting richer and what’s left of the American working class (those not newly unemployed) are paying the bill
  • As the situation worsens, self preservation kicks in, and Americans care less and less about others.

The American frog is in a pot that’s getting hotter and hotter.

There is an upside to all of this outside the USA. Hundreds of millions (perhaps billions) in emerging markets are increasing their standard of living. They have or are learning to Manage their capitalism and hopefully not repeat mistakes that were made here.  Greed is a powerful factor and one hopes eventually more democracy will grow abroad.  If Time magazine called the last decade The Decade from Hell for the USA – it could get a whole lot worse for the American frog in this decade.

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 +1.09% down
NASDQ +1.42% down
S&P500 +1.25% down
Russell2000- +1.75% -

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.

Stocks staged a major rally (above 1%) in decreased, average volume. Volume, our #1 confirmation factor did NOT confirm the move higher. Even though we achieved some new highs (for a calander year) on 3 of the major indexes we are doing it in reduced volume.

  • McClellan Index at +i3.14 = A little bit overbought.  There’s a long way to go till we reach @-60 or oversold or @ +60 or overbought

IBM reported after the bell and beat top and bottom line expectations. This was not a grand slam, but IBM did solidly better, but lost money in after hours trading.   The important news from IBM which does 60% of its business abroad was that their areas of growth were "Brazil, China, & India."

Even though stocks rallied yesterday still believe in down week.

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

SELLING & BUYING


YOUR Watch List of Stocks . Unfortunately, I’m not daily checking these stocks out. Ideally, you’d like to McClellan index below zero (the further the better) and these all would be better buys. We developed most of these potential stocks about two weeks ago. Check old Investors411 for more.

Again the problem with buying now is that markets are slightly overbought and you would like stocks oversold position. Click on ticker symbol for chart. Going to limit Watch List to @ 10 stocks.  80% of investments wil be ETF’s 20% stocks.

NB – I feel much more confident with ETF’s because they reflect global trends than individual stock. Too many things can go wrong with individual stocks.

  • SEED In a buy the dip position.
  • AAPL big +4.42% rally yesterday. Sitting on breakout point. AAPL moves markets – if this goes higher so does the market.
  • AMZN We sold at highs and AMZN has formed lower highs and lows. In bearish mid term pattern. Will drop from list soon
  • HMIN - Failed breakout, back at lower end of trading pattern. Will drop from list soon
  • CAAS Buy the dip opportunity as CAAS falls to just above 50 day moving average.
  • PCLN Buy the dip opportunity
  • F Still too over extended to buy
  • DRWI New – Big exporter to China -  Looks great but still too overextended to buy
  • ENOC New – Reduces costs for utilities – Great long term chart. formed base for last 5 months moving higher – A buy
  • ATHN New - Software reduces costs for health care - Clear trend higher since June Buy the dip opportunity
  • IMAX Great long term chart – falling back to its 50 day moving average. A buy the dip opportunity

Mistake – I let my emotions over rule logic on IMAX It was too overextended from 50 day moving average to buy at 13.9. So I’ve sold the small position (1% of portfolio I bought at 13.9 for 10% loss) Keeping 1% bought at 12.9 and will add more at lower price.  Perhaps the most important rule of investing learn from mistakes and do not repeat them.

If markets were overbought I’d strongly consider ENOC, CAAS, ATHN, SEED, & PCLN.

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

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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