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Inflation

It’s no secret, almost every country out there is seeking some advantage to manipulate their way out of the economic “Great Recession” or keep their economy growing at a rapid rate (emerging market countries)

Part of what our Fed does with its quantitative easing puts pressure on China and other emerging market countries that results in inflation abroad. There are inflation fears in USA, but it is emerging markets are really feeling the brunt of INFLATION as they have recovered far faster than either the USA or Europe.

Three major articles on this today. It is a problem for all emerging market countries.

• Nobel Prize winner Paul Krugman – China goes to Nixon
• Seeking Alpha’s John Nyaradi - Inflation fears Spreading Through Global Markets
• In a pot calling the kettle black article & why only 3? Sam Willford – US Names Three currency manipulators

Emerging Markets have fallen for about a week on inflation fears. This has also impacted commodities.

Bottom line for Investors – Not only are we overbought (Long term up 7 weeks in a row) but there is a new fundamental – fear of inflation that could take a bite out of emerging markets and commodity prices. Our Fed is walking a tight rope. So far skillfully. But the wind is picking up.

Our turn will come, but the clear and present danger in the USA remains Jobs, Jobs, Jobs.

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KISS & Stocks (Keep It Simple Stupid)

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

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Technicals, Fundamentals & Analysis

Investors411 record - 6 years of beating benchmark S&P 500

• We had what many stock pros call a “confirmation day” The day after 3 of the 4 major indexes took a hit, they DECLINED further = confirmation. More often than not this spells trouble, especially after reaching a top.
• One of the primer analyst who technically called the the S&P top in 2007 (It plunged 57% starting in Oct. 2007) Tom DeMark, has made  another bearish call that market will plunge about 11% stating in a week or two.
• In opposition to all this is the FED’s POMO. Notice that directly after the Fed purchased bonds from its 21 big banks at 10:15AM EST to 11.00 AM the US markets started to rally from inter day lows and moved higher.  Strong correlation between this liquidity coming into markets and stocks moving higher since it began in 2009.
• This is an Options expiration day – third Friday of the month. This sometimes makes for unusual activity and increased volume. However since we have had a short term reversal of trend some of the calls will not get made and volume will suffer. Translation expiration day will probably not have big impact. Other forces might.
• Key factor of day – Inflation fears

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Reading The Tea Leaves

Too many fundamental worries out there. Therefore, going to wait for better conditions or a lower MO to buy.

Will inflation fears trump the Fed’s money dumping and hurt US equities? It has this week. Most say we are long overdo for a correction and DeMark’s call (see above) is significant. Many US companies  that sell to emerging markets could and have been a monentum play to the upside could end up the same way cloud computing did, (See FFIV yesterday)

It’s an escalator going up, but a elevator going down & right now for US equities we have the Fed manipulating to ease the pain.

What to watch today

Dow Index – Almost all sectors that may be negatively impacted from Emerging market inflation – high growth stocks, commodities, China, gold – have faltered this week. The big holdout is this minor meltdown are the giant Dow companies.

AAPL – breaking below its 50 Day Moving Average would be trouble. It fell 1.82% yesterday & rising 50DMA is about 3% lower

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Positions

• UWM - (2x small cap stocks) A 1/2 position. Setting 2% trailing stop today. Considering selling into a rally.
• REMX - (rare earth metals) Sold 1/2 at 23.23 for a 1+% loss. Setting 2% trailing stop loss today

Look for short term a rebound today.

Under consideration – Not touching anything new

UCO -(2x oil prices) All commodities, including gold are under pressure from inflation worries in emerging markets.

REMX (Rare Earth ETF) –  Rare commodity used in everything from some TV’s to hybrid cars.

UYG (ETF that does 2x Dow financials) XLF is the financial ETF. - Shadow banks have numerous advantages. – Opaque, special help from Fed and your still on the bottom line to bailout too big to fail institutions.  This sector is being manipulated higher by Fed. Those that can overcome ethic problems with shadow banks could consider buying. Yes, this is another bubble building.

DGP – (ETF is 2X gold)

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How to look up comments from the last two weeks.

Click on SUBSCRIBE TO RSS (top right of blog) You will see a list with title and short summary of the last two weeks of blogs. Click on title and up will come that day’s blog and the comments associated with it. Scroll down to comments

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Look for Paul R’s always enlightening remarks on stocks and sectors in the comments section of the blog. See POSITION section of blog for lists of potential stocks & ETF’s including “YOUR Stock List.” (YSL#3)

Gail Collins, NYT Op-Ed writer of The 5% Doctrine

5% Doctrine

Basically, there is about “5% of our population is and always will be totally crazy.“ Like the Florida preacher who wants to burn the Korans. Collins goes on –  ”According to the National Institute for Mental Health, 26 % of American adults suffer from a diagnosable mental disorder in any given year” (Thanks to Paul R for bring this editorial to my attention.)

Let’s extrapolate two important lessons from this –

1. Fear Mongering Islamaphobia (FYI – the NYC Islamic Center that will have rooms for different religions to come and pray together) has clearly whip up the hysteria of both the 26% and the 5% over the NYC Islamic Center. The Florida pastor is the end result. The fear mongererer’s have already done harm to our own troops and its now been a recruiting tool for fanatics/terrorists.  It could get a whole lot worse. Politicians and ideologues (lots/most in that 26% category throw gasoline on this fire and ratings hungry American media throws more. So when you start to Islamic fear monger it has consequences.
2. Moslem’s have there own 5% & 26% You can argue that this figure is higher/lower. Islamic countries have been subjected to US backed dictators, invasions, their own dictators etc. They generally don’t have a high a standard of living, but lack the technology to spread fear as rapidly as we do. Their, give or take, 5% turns into Hamas, al Quaeda, etc. that do damage to their own religion and the rest of the world.

America’s civil rights hero Martin Luther King was told, its not time, the countries not ready, and how dare you march for freedom. Yet he went on with his Birmingham march. The rest is history.  The same holds true for an Islamic Center in NYC that invites other religions to have rooms in their building to pray.

Many of you oldsters, like me, remember or participated in those marches. Some of you are too young. Jim J in the comments section of the blog reminds us it was Edmund Burke who said “Evil triumphs when good men do nothing.”

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KISS & Stocks (Keep It Simple Stupid)

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Technicals, Fundamentals & Analysis

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

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

Each year the financial channel and about every other source that talks about volume mentions “when folks return from Labor Day holiday volume rises”. It was below average again yesterday and dismal relative to its moving average and previous years. The retail investor is a dying animal.  Again BB/HFT’s rule.

US Stocks are like a ghost town  and you’re walking around wondering that behind the saloon door might be a zombie or a pot a gold.

If you want some in depth analysis of current situation check out Fredrick Ruffy from Seeking Alpha

China keeps on growing See BDI below as confirmation of this story. Number of stories out there about how China is dominating Clean Energy manufacturing by cheating.

China grows, China cheats, China manipulates its currency, has been a two decade long trend. The USA is caught between the proverbial rock and a hard place, because so much of our companies growth/profits depends on China.

Significant Indexes

• The Dollar (USD) [Anything daily price move over +/- 0.50 is significant. Dollar moves inversely to stocks] The dollar, rose +0.11% higher yesterday. Dollar in 4 week long trading range. For stocks = Neutral
• The Baltic Dry Index (BDI) [measures cost of world trade. Also proxy for China & emerging markets] Rose +0.44% yesterday. Chart pattern = Bullish
• McClellan Index – (MO) [The rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks.] MO rose to +36.38 yesterday. Clearly above zero and within 24 points of +60. So we are nearing overbought levels, but still= Neutral

Reading Tea Leaves

Even though a breakout to a new (month long) high failed, momentum still with bulls. We may have started a consolidating pattern.

Suppose the fact that the dollar rose a very small amount and stocks also inched higher instead of falling gives bulls some hope till we reach oversold levels.

Positions

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

Current positions –  EWS (Singapore)

Short term traders – There’s some wiggle room before overbought levels are reached, but its mighty narrow.

But investors & longer term traders should be thinking that we are getting close to overbought territory and it will soon be time to take some profits.

Long Term Outlook – NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

Chucky’s Back

Intimidation

Its become obvious – The main thrust of the right wing in the USA is now Intimidation - “You’re either with us or against us.” This week alone the Intimidation has exploded to new levels.

• Man arrested for “Let The Violence Begin” Death Threat to Senator Patty Murray (D. WA) over her pro health care vote
• Man arrested for serial death threats to family of House Speaker Nancy Pelosi (D CA) over health care vote. “The mother links son’s death threat to FOX news“
• Revealed Massey mining disaster CEO Don Blankenship has spent over $6 million against any judges or state legislators who fought for workers protection in his mines. Massive and serious violations and fines not paid at this non union mine.
• Analysis of influx of violent threats including over 30 governors who received letters that they had “3 day to get out or else” over taxes (sorry there a short ad)
• Go. of VA announces Confederate history month (not civil war history month) and forgets to mention slavery. Imagine Germany honoring just their soldiers, and storm troopers  in WW 2 and forgetting the holocaust.Gov. later apologized. Analysis Listen to the letter written to Black congressman called N—-r and other names over and over in analysis.
• Republican Congresswomen Michele Bachmann quote “I want Minnesotans armed and Dangerous.” This is just one of many quotes. She appeared two nights ago with 1/2 term governor Sarah Palin. From last night Rachel Madow show

Montana has a long but enlightening history of the violence within the Republican party in the comments section of the blog. Is this their “Waterloo”? Now the intimidation, bullying and hatred is growing.  Repulicans are condoning it or ignoring it because it adds to their power/money.

Intimidation is unacceptable, it goes beyond the realm of free speech. It should be prosecuted as assault.

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!

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

Technicals, Fundamentals & Analysis

See Positions for changes made each weekend

Increased, above average volume and moderate decline for US markets. Normally a big volume moderate decline would raise an eyebrow, but that’s the way this rally has progressed especially in the last month.

Investors411 has gone over all the warning signs, but momentum currently is still with the bulls. The McCellan Oscillator is technically in neutral territory so Investors will not add or subtract from positions now. (except or short term trades)

Seeking Alpha is the #1 recommended sight by YOU on stocks. You folks send me more personal emails on stocks from authors featured at this site than any other. Each morning it is one of the site I skim for news –  Their analysis of yesterday’s fall – a larger than expected decrease in consumer borrowing.

Consumer borrowing is certainly a factor, but it sure looks like the rising dollar (see below) and oil prices is more significant to both stocks and the economy. Mantra – Watch the dollar because it is close to a major resistance level – US stocks will move in the opposite direction. (See past Investors411 and below for reasons the dollar moves)

Significant Indexes

• McClellan Oscillator fell s to -6.84 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – This is still NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – rose  +0.27% yesterday. [Anything over +/- @0.50 is significant.] +o.53 over two days. and over 1% for three days.  The dollar over the last 3 days had a significant impact on why stocks fell yesterday. We are moving close to resistance/breakout level

Positions

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

EWZ (Brazil) Over the years the ETF’s for Brazil, China and Emerging Markets have been Investors411′s #1 investment choice. Although diminished (Down from 25% to 10%) EWZ is still #1. See OVERVIEW section of blog for more. Brazil:

• Benefits from a huge amount of natural resources.
• In 2000 a left wing government took over and spread the wealth so more working class people spent money. Money flowed so the economy grew. It does not have to be a “left” wing government to have greater success what you have to see is a spread of wealth/power from an oligarchy to working people who spend the cash. (there are other factors involved – but time limits explanation.)
• Brazil is less impacted by “shadow financials”
• Brazil has an election in late 2008 and term limits mean they will have a new President – This creates uncertainty and is a negative.
• More in depth economic analysis
• We have to be careful because Brail is going to outperform on the way up and down.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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Teddy Roosevelt

Back in the early 1900 Republican President  Teddy Roosevelt busted up the big monopoly shadow banks when they tried to take control of government.  Big Wall Street banks have increased their control over Washington for almost 3 decades. Is Barack Obama a Teddy Roosevelt?

Can financial reform end the too big to fail problem? “Big shadow Banks have become even more powerful since the 2008 meltdown.”  Worthy editorials & videos

• Baseline Senerio’s MIT prof Simon Johnson today on Paul Volker
• Again MIT’s Simon Johnson on Steven Colbert show. As always humorous, but informative video (Interview starts at 15.00 minute mark into show and last 6+ minutes)
• Bob Kuttner former Businessweek & Boston Glob reporter who has his own mag., American Prospect on banking reform and the need for a game change like Teddy Roosevelt

If Democrats want an issue to run on in November. This is it. But perhaps/probably too many  are owned by bank lobbyists.

Bottom Line – If the financial legislation ends the too big to fail problem its good. If not it stinks.

The Public Option Did WIN

The “inclusive, single payer, cost effective, money saving ($61 billion over 10 years – CBO) robust Public Option” was won in education. This overlooked  bill was passed along with Health Care reform and cut out the banks (middle men) and opens opportunities for anyone seeking help at the college level. Jeff Cohen editorial

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!

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 each weekend

Another day of weak volume.  US equities were basically flat. Flat prices in high volume indicates a shift in course. Flat prices in low volume indicates little.

Good news was consumer confidence rose last month. Seeking Alpha (one of the best financial sights out there) presents an interesting long term view that low consumer confidence has historically been a good time to buy stocks. Bad news was concern over sovereign debt (see below)

KING DOLLAR is the major index to watch. (see below)

Significant Indexes

• McClellan Oscillator fell slightly to -4.55 yesterday. [+60 or above = Overbought = sell. -60 or below = oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. -Same pattern continues - We right in the middle so NO clear signal. However we are still in bearish pattern of lower highs and lower lows.
• US Dollar -started back up +0.21% yesterday.

What the dollar does over the next few weeks is critical to stocks and economics around the world. The dollar has risen 10% since Dec.. This means that US & China (their money is pegged to ours) exports are 10% more expensive to the rest of the world. A higher dollar,therefore, puts real negative pressure on US/China stocks, what you pay, and an economic recovery.

This is why the sovereign debt crisis in Europe [PIIGS & former Russian satellite countries] has the potential to plunge us into round two of the recession. The dollar is rising because of the problems in Europe.

Positions

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

DWA (Dreamworks) Ended up selling all of DWA for 4% loss. Was stopped out of 1/2 and sold the rest. Selling the last 1/2 was probably a short term mistake because after three days of big volume selling it should bounce higher this AM. Loss -4% on 2% of portfolio

RGC & CNK – Opened a 1% of portfolio position (hopefully long term position) in each stock. RGC price = 17.68 & CNK = 17.98. Will add to these on dips. Caution if Easter weekend movies bomb, these two stocks will get hit. A safer entry point may  be Monday or Tuesday.

Waited for even a 2 to 3% dip in IMAX to buy a bit more, but it just not happening. IMAX is NOT having a climax buying spree (going elliptical) yet, because there is NO big volume behind the rally. IMAX now up 30 to 40%

Will try to add a 2% position in TEVA today. Hopefully at a slightly lower price.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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Congressional Budget Office

The non partisan CBO came out with its report on Health Care. Both Republicans & Democrats endorse the CBO reports when it favors their side in whatever debate. Here are some of the major points on the proposed plan

• Increase costs by $940 billion and cut costs by greater $1,078 billion over first 10 years = net federal deficit saving of $138 billion
• Cut deficit 1.2 trillion next 10 years
• Adds coverage for 32 million Americans
• Closes “doughnut hole.” – no longer a gap in senior coverage

Basically it covers 95% of Americans and cuts deficit by over $1.3 trillion over next 20 years – WAPO’s Ezra Klien. Many analysts feel that this would increase medicare solvency by 9 years

Is Support for Health Care Reform Changing?

Nate Silver, the best poll analyst out there says yes. The center and the left are moving toward Obama on this. Last look at betting site Intrade showed a 78% possibility of bill passing.

The Devil is in the Details

There is a big give away to Louisiana, because they have a Dem. Senator up for reelection and more will come out.   Hopefully they can be changed later. The obvious downside is that this increases the monopoly the insurance & drug companies have. Therefore the exorbitant  17% of our  GDP that goes to Health Care will NOT significantly change

Catholic’s Supporting Health Care

Several major Catholic groups (Catholic Health Organization most notable) are now supporting health care. It’s dawned on them that we are the abortion capital of the world and covering more people will REDUCE abortions as it has in other counties. Thanks to JAB bringing this up in comment section of blog. See JAB’s and other comments  on the right side of blog.

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!

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 markets went all over the place yesterday and on the whole ended up flat in decreased, weak volume. This is probably due to options expiring today (the 3rd Friday of the month).

There was some bad news out of Greece

Significant Indexes

• McClellan Oscillator fell significantly to +30.01 yesterday. 0 is Neutral and +60 or Overbought territory. The recent high three weeks ago was 75.33 StockCharts has a better version of the McClellan chart ($NYMO) LINK. – Once again the NYMO has fallen back down to its support level at 30. While it is much safer to make investments when conditions are oversold (-60) if we are in for a long term rally those willing to take bigger risks could nibble the dip here.

Positions

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

Repeat from Yesterday – “Going to build up to a 20% position in stocks involved with 3D technology

. “IMAX, DWA, RGC & CNK In one sense Investors411 will be building its own market basket of stocks (like an ETF) on the potential of 3D technology.

Many of the Stocks on YOUR stock list are great, perhaps even better than the 3 D plays. The difference is fundamentally 3 D has shown it has pricing power. People around the world will line up to pay an extra 20 to 40% to see a 3D film. Think people will go to movies even if we have another leg down economically. I simply have not had the time to go over the fundamentals of the other stocks. Remember AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Investors411 ETF positions are currently under performing the benchmark S&P 500 FXI (China) MOO (Agriculture stocks) & EWZ (Brazil – just a bit under) In one sense technically after many years of out performing this was bound to happen. Investors411 has also cut way back on major foreign investments from highs @ 25% each to 5%.

Three significant reasons US markets are outperforming other foreign  markets

• Obama’s health care reform does nothing to break the monopoly of the insurance and drug companies. If anything it makes them more $ by covering more people.
• Financial reform of greed based capitalism proposed by Senator Dodd (D. CT) is very weak and does little to increase transparency.
• Core inflation is well under control From today’s Seeking Alpha – “Thursday’s BLS report on CPI showed core inflation at 6-year lows, up just 1.3% over the recent 12-month period. The main reason for this: The price of ‘shelter’ remains depressed, up only 0.3% YoY.”

Bottom Line – No real reform means another bubble is inevitably building in our greed based (as opposed to rules based) capitalist system. Home prices remaining depressed means the US Fed will keep shoveling money into the system builds both the economic bubble and stock prices.

Investments – There are going to be more short term (when we are closer to overbought) and longer term (when we are oversold) trades involving ETF’s like TYH that do 2 & 3x what an index does.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Head of Lehman Brothers Dick Fuld

Friends and Enemies?

What countries do your fellow citizens look at favorably and unfavorably? Gallop Poll has some fascinating results with Canada on top and Iran on the bottom. In black and white, over the top terms – who are out top 3 friends and top 3 enemies? Interesting - 90% is the largest rating up or down.

D’s blog comment

As always check out the comments on right hand side of blog by Popeye, PaulR, D, & Doggie’s Mom on Israel and stocks. One comment is something I think or hope we all share by D -

I’m so sick of those who are blinded by their emotions and stereotype one side as all evil and the other as all good.

Seeking Alpha

Three of you last week sent me editorials/articles from this financial site.  THANKS Reality is money makes the world go around – or at least influences everything from politics to religion. One particular man to follow is Jeff Nielson – read The Plutarch nation about the huge and growing division between rich and poor in the USA – How great the tax cuts are for t he wealthy and how small they are for the Middle class.

Lehman Brothers

Turns out that Lehman Brothers was lying about how much money they had and their accountants (Ernst and Young) backed them up according to a 2200 page report. Lehman’s collapse set off the 2008 meltdown. Seeking Alpha currently has 3 stories on this, but this  Dylan Ratigan video best explains how “the crooks” scammed the world through “repo transaction ” One of the Greatest crimes in history.”

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!

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)

Flat day in weak volume. Volume has NOT confirmed the move higher over the last few weeks. Cutting this section short to answer YOUR QUESTIONS

• What exactly is going elliptical? I really wish there were a clear set of exact rules to follow. Basically, its when a stocks moves too high too fast in big volume – it runs out of buyers and collapses because there is no one left to buy. This can also happen with sellers and going down too fast. This can happen interday (for day traders to use), but most of you are longer term traders than that.  Look at the charts of 3 stocks that have just gone elliptical. IMAX, C & CNAM (the later went elliptical @ a week ago. Common characteristic three or four days of a 20+% move higher in HUGE volume. Usually the bigger the climb & volume the worse the drop afterward. First off going elliptical is almost always a time to sell.  The harder question is when to jump back in. (tomorrow)
• Are TYH and other ETF’s that do 2 and 3 times what a market basket of stock do dangerous to hold overnight? See PaulR’s always astute market comments on the right side of blog. Short answer is YES. If you look at the “candlestick” chart of TYH over the last 6 months you will find several times is opened @3+%lower and one time in late November it opened @5% lower. This puts it in the same category  as “high beta” (hot stocks) stocks like Citigroup. Citi’s chart shows a  few more days it fell over 3+% and one time in December plunged @7% overnight. There is a big risk in both.
• Solution – First learn more about the technical aspect of investing. Second you can mitigate the risk by buying less.  Say you think technology is going to go up so you buy QQQQ (basically a tech ETF that mirrors tech.) THY does roughly 3X what QQQQ does. Therefore, Invest 1/3 the money in TYH that you would have in the QQQQ. It’s then almost the exact same risk in total money and you have 2/3 of your capital earning interest or for another investment. This is called leverage. And as many of you know there are a zillion other ways to mitigate risk through leverage. Some good (like this if you don’t go & over leverage your whole portfolio) and some that can get you and the world in a whole lot of trouble.

Significant Indexes

• McClellan Oscillator fell a again to +51.09 yesterday. We are still under +60 or Overbought territory. StockCharts has a better version of the McClellan chart ($NYMO) LINK. Two weeks ago week the NYMO reached a high of 75.33. Interesting fact here NYMO is falling as stocks slowly melt up.  This is probably due to the fact that this Oscillator takes into account volume that is declining.
• 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. After flattening for a few days it is again starting to explode higher = Bulls rule
• USD – The Dollar 0 Friday the dollar -0.58% and broke through a support level.  In the past there has been a strong correlation between a falling dollar and a rising US stock market. = Bullish sign
  

Positions

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

Over the last few days several of you have sent emails with many interesting new stocks RINO, CTRP & explosive CNAM are three I’ll add to tomorrow’s watch list.

From Friday “Shorter term traders – ” Bought a 10% (Of portfolio) position in TYH at 151.50. Put stop at that 151.5 and may sell 1/2 for 3 to 5% gain hopefully today. TYH closed at 154.99 – Sold 1/2 TYH at 156,oo for +3% gain Friday AM

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING