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Gulf Oil Spill & the Financial Crisis
Bob Kuttner, often mentioned in Investors411, explains why the Gulf Oil Spill is almost exactly like the Financial Meltdown. [Bob is from my hometown and used to endorse my wife when she ran for school committee]
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 | -1.11% | down |
| NASDQ | -1.54% | down |
| S&P 500 | -1.72% | up |
| Russell 2000 | -3.12% | - |
Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes
Technicals, Fundamentals & Analysis
Significant Down day in mixed light volume = Moderately Bearish
Massive amount of bad news – N. Korea, BP failed to plug oil, Israel/Turkey/Gaza. Surprised markets did NOT drop more. = Bullish
MO getting close to Oversold = Bullish
Expect Fed and other central banks to prop up Euro again = Bullish
In the long run price fixing rarely works. This is what our Fed and other central banks are doing to the Euro. However, as long as investors are willing to buy government bonds at a low price the situation will hold. Best read of tea leaves – Don’t see any signs of impending breakdown. = Bullish
Significant Indexes
- McClellan Oscillator fell to -50.19 [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is nearing OVERSOLD territory. How the MO works.
- US Dollar – The dollar rose +0.03% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important. Currency markets are now being directly manipulated by out Fed and other central banks. This manipulation to keep the Euro from falling = Bullish.
Positions
The Positions Section = latest buys and sells - These are positions I actually own
Have NOT had a chance to update last weeks trade.
YOUR Stock List
Caution - This is mostly just technical analysis and lots of other factors enter into a decision to buy or sell.
Terminology
- 50 Day Moving Average of price- blue line on chart = 50DMA
- 200 Day Moving Average - red line on chart = 200DMA
- Ticker symbol for each stock is a link to a chart.
- Volume - Horizontal red (down days)and green (up days) line at bottom of chart show volume
- * Owned positions
- “Volume good” - translation – relative to major indexes individual stock is looking good – probably more upside volume on rally days than downside volume on toasting days.
Most of you are looking for longer term buys. Remember Stocks are in most cases riskier than most ETF’s. Our main strategy is to buy the dip of a stock that is trending higher.
Relativity – The last YOUR stock List was done on 5/18
- The Dow was above 10,600. Now the Dow this AM is just above 10,000 = almost -6% lower
- MO was at -68 then and -50 now = conditions were more oversold then than now, but still oversold.
AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING
- AAPL . @+1% since 5/18. Last big cap tech stock left standing. Has held up pretty well. Caution – Chart shows its near strong resistance level. Formed double bottom = Bullish Should continue to outperform. Buy the Dip
- SHOO @-6 Chart shows lower highs and lower lows. Old favorite that has produced in past in bearish pattern – Gone.
- *ICON @-6% Another series of lower highs and lower lows – Gone
- DGIT @+0 Firm tend line higher. Higher highs and lows. Good volume. Dipped down @5% from high three days ago. Has had 10% dips in past. Buy the Dip
- *VCI. @-2% Has series of higher highs and lows. Good volume. Big fall -5+% in moderate/weak volume yesterday. Buy the Dip
- SNDK @+5% Broke out to new high and is falling back to breakout level in weak volume. Buy the Dip
- CTRP @-0% Stock has big swings and trouble getting past strong resistance at @42. But series of higher lows & decent volume make it a potential winner – Buy the dip
- *ESRX - @-2% Still outperforming markets, Volume good. Has strong resistance level at @105. Consolidating. Future Breakout candidate. Buy the dip
- *IMAX @-15% Investors411 has sold 3/4 of this position. Our +60% gains are melting away. Dangerous head and shoulders trading pattern forming. Volume not good. At critical juncture. Sell into rally.
- MSPD @-8% Lower lows and lower highs. Oversold right now but pattern broken.
Fresh Five – 5 new stocks
- OSTK (Overstock.com) Exploded higher in early April & May. Now consolidating. Dipped last 3 days in weak volume. Getting close to rising 50DMA. Buy the Dip
- JAS (Jo Ann Stores) Has had trouble (like ESRX) getting past resistance level above 47. Good volume. Dipped last 2 days after attempted breakout failed. In trading range between @40 & @47 Outperforming. Buy the Dip
- BIDU (Baidu INC – China’s Google) Outperforms. Broke out/soared in May & has pulled back. Support at rising 50DMA. Buy the Dip
- SAM (Boston Beer Co.)Great Beer Co. going elliptical on breakout run higher. Wait for correction
- EVVV (ev3 Inc.) Had a HUGE +17% move yesterday in giant volume. Wait for correction (Last 2 both have lots of potential)
On the whole YOUR stock list outperformed major markets over the same period of time. Since generally the stocks chosen have a higher Beta (more volatile) you’d expect them to do worse.
Since Central Banks around the world are flooding the currency markets with money to stabilize the Euro its hard to see another major leg down in stocks right now. Remember, if Euro goes down, the dollar goes up and that hurts stocks.
BP/Transocean/Halliburton, N Korea, Euro Debt, Israel/Turkey/Gaza issues have all seemed to have been priced into the market. Overall, for long term investors still = CAUTIOUSLY BEARISH
Politically the Obama administration, as every administration before him, will bend over backwards to keep stocks moving higher into elections.
Traders – You’d like the McClellen Oscillator (MO) to be lower, but a short term trading window is decent. NOT great.
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Long Term Outlook = CAUTIOUSLY BEARISH
AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING
