Investors 411 Blog

by Barr Jozwicki
January 3, 2011

Secrets and Democracy

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

Greenwald

WikiLeaks

CBS has published a can extensive compilation/summary of WikiLeaks documents that you can judge for yourself instead of listening to all the spin. Their title -” How WikiLeaks Enlightened US”

Transparency is essential to a vibrant Democracy.  Is the USA shifting toward a more dictatorial state like China and Russia that practice greater censorship of the press and persecution of those who oppose the government?

WikiLeaks has exposed no “Top Secrets” like Daniel Ellsberg did decades ago or the NYT did last decade. They have published “secrets” Here’s a Debate featuring Glenn Greenwald backing Jullian Assange and Fran Townsand in opposition

I do have have a bias because I’d love to see WikiLeaks information on the Shadow Banks and strongly believe  transparency is vital to freedom and democracy.

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KISS & Stocks (Keep It Simple Stupid)

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

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

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Index Percentage Volume
Dow +0.07% flat
NASDQ -0.38% flat
S&P 500 -0.02% flat
Russell 2000 -0.77% -

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Technicals, Fundamentals & Analysis

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

  • Markets were flat & volume abysmal AGAIN
  • There are indications that at least some fresh money may be coming into stocks in early January. (see below)
  • The dollar has fallen like a stone for last 3 days and broke its support level For US stocks = Bullish
  • Big news at end of week is the unemployment report.
  • Here’s Seeking Alpha’s Jeff Miller on this week – “Less Risk, More Reward

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Significant Shorter Term Forecasting Indexes

  • The Dollar (USD) [Anything daily price move over +/- 0.50 is significant. Dollar usually moves inversely to stocks] The dollar fell significantly Friday breaking a support level.  -0.70% Friday. or stocks this is = Bullish
  • The Baltic Dry Index (BDI) [measures cost of world trade. Also proxy for China, emerging markets,&  exporting countries] Again NO DATA. Perhaps its the holidays BDI is at 1,773 and is approaching its major support at 1700 = Bearish Going to drop this if I can’t find data) Another indicator to use would be copper prices which are very high and therefore contradict the BDI.
  • McClellan Index – (MO) [The very rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks.] fell a bit to +14.59Neutral
  • 10 year T Bill (TNX)  In consolidation pattern  Some big recent moves shows big indecision = Neutral

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Reading The Tea Leaves

The first days of the month and Mondays are historically good days for US stock markets.

Friday we went over the possibility of an infusion of new money into the market in early January. All those giant shadow bank  and Wall Street executives have to put their bonus money somewhere and there is some evidence that it has started to trickle back into stocks (See Friday’s Investors411)

The dramatic reversal in Oil prices Friday caught at least me with my pants down.(see UCO below)  Oil prices more than making up the gains of the previous two sessions of losses is bullish for oil, commodities and stocks.

The  dollar significantly through a support level is a very bullish sign.

So when you put this together with the dollar breaking a signifiant support level Friday - At least for the short term -The Bulls are back.

The MO is at +15 and therEfore has lots o “wiggle room” before it reaches +or - 60. Room for a rally

Repeat- AAPL the world’s #1 tech stock is the canary in the coal mine. If the General rolls over watch out.

UUP the tracking ETF for the dollar is what to watch today. If it falls again – Bulls could Roar

Note Well - The dollar’s fall & corresponding rise in oil prices is something I should have noticed at 3:00 EST yesterday. Unfortunately, its called get a life, and I was otherwise occupied. If not I would have bought some long positions Friday PM.

HOPEFULLY, INVESTORS411 EDUCATES YOU SO THAT YOU CAN LEARN/UNDERSTAND WHY MARKETS SHOULD MOVE HIGHER OR LOWER

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Positions

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

(I do manage 6 accounts that have other positions).

Current ETF Positions. (oldest held positions listed first)(see comments section where all trades are first announced)

  • #1 UWM - (2x small cap stocks ETF) – 1/2 position
  • #2 UWM
  • SLV – (Silver ETF) Bought Wednesday at (see comments section of blog.)
  • DGP -(2x gold ETF) Bought yesterday at 41.86

Under consideration

UCO -(2x oil prices) From Friday – “Oil prices got over extended and a short term reversal is to be expected”. Mea Culpa – Waited too long for dip as UCO rose 4+% yesterday and got stuck with a 1% loss by selling early Friday. (see Friday’s blog) Too high to by right now.

REMX (Rare Earth ETF) – Friday – Way too hot to buy now. Like a zillion investors who missed this initial jump we are waiting for a pullback. Lost -2.04% Friday. Would buy any similar drop today, but afraid its not going to happen.

EWZ (Brazil) & LBJ ( 3x Latin America – majority Brazil) Obviously the later is more risky because its leveraged 3X. On a role with three big up days in a row. Short term traders may risk buying a dip, but again afraid there will be no dip.

Note - The time has come to start rotating out of small cap stocks. They have had a great run. They will go up if the other major US indexes rally. However they probably won’t outperform as well as they did last year.  Investors will be looking at other leveraged ETF’s that have larger caps. So will sell some UWM today – hopefully into a rally.

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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)

Longer Term Outlook - CAUTIOUSLY BULLISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

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November 8, 2010

Election Disaster in Two Words

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

Larry Summers

Lord Vader/AKA Larry Summers

If their is one man to single out for the lack of coherent response to a massive destabilization of the worlds economy its Barak Obama’s now former economic chief Larry Summers.

Last Tuesday a mass of increasingly bitter, alienated and emotionally driven people voted for change. Few realize that Lord Vader and his oligarchy of Casino Capitalists won the election.

Summers stands at the apex of the triangle of “hugely damaging conflicts of interest of the senior academic economists who move among universities, government, and banking.”

Every Investors411 reader knows about the legion of lobbyists corrupting government and now the legions from academia who are bought by the shadows of casino financial capitalist.  Millionaire economists, Fed officials, and university professors who “refuse to disclose their conflict of interests”

See Charles Ferguson’s “Larry Summers and the Subversion of Economics” editorial (a must read) for a broader list or see Inside Job docudrama.

Perhaps the most damaging moment (and it is a hard call) is when the head of the International Monetary Fund, Raghuran Rajan in front of a field of world’s top economic experts (2005)  including Greenspan, Paulson,  Bernanke, & Geithner is shouted down by Summers for warning that the impending 2008 financial shadow bank meltdown is coming.

If you’re a true blue Democrat then Summers is Benedict Arnold. But I prefer to look at him in a battle between true transparent capitalism and the casino, opaque, oligarchy of monopolists  that is increasing their wealth and stranglehold over working Americans.Economist John K Galbraith opens his editorial on the election with the following paragraph –

The original sin of Obama’s presidency was to assign economic policy to a closed circle of bank-friendly economists and Bush carryovers. Larry Summers. Timothy Geithner. Ben Bernanke. These men had no personal commitment to the goal of an early recovery, no stake in the Democratic Party, no interest in the larger success of Barack Obama. Their primary goal, instead, was and remains to protect their own past decisions and their own professional futures.

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

Index Percentage Volume
Dow +0.08% up
NASDQ +0.06% down
S&P +0.39% up
Russell 2000 +0.43% -

Technicals, Fundamentals & Analysis

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

US Stock Markets -

King dollar rallied on good economic news (employment report) and some bad news out of Ireland/Europe forcing the Euro lower.

Stocks held their own despite a a major rally in the dollar. (a surprise) = Bullish Sometimes there is a delayed reaction and certainly if we have another major move higher in the dollars the reaction of stocks will not be as benign.

Huge trading volume  move higher into the close Friday. Technically this is usually bullish It is also highly unusual because major US indexes are trading so far above their 50 day moving averages or Bollinger Bands

The hope – Obviously a lower dollar means US goods cost less abroad and major exporters will benefit. Stocks go up, investors/traders/401k’s/etc. get wealthier and Americans spend more on US economy & employment improves

The curveballMost of the wealth is going to a super rich oligarchy that invests $ in faster growing emerging markets, derivatives, Black Boxes, or cash rich companies that buy other smaller companies, eliminate workers of smaller companies and hire abroad.

Conclusion - Investors411 has pounded the drums ad nausea on how huge the 2008 credit crisis really is & the fact that no significant solution is in place to prevent it from reoccurring. – Therefore, there is likely to be more QE2 or a QE 3, 4, 5.

Fundamentally, US Stock win both ways – Economy/employment improves in USA and we don’t need QE 3, QE4 etc. The Fed keeps printing and dumping the dollar goes down and stocks improve.

There is, of course, an imbalance (possible inflation down the road) to print and dump. (see past Investors411), Europe could tank, or a dollar war develops into a trade war. But, right now it looks like print and dump will be the underlying force for US stocks for a while.

Sweet Pineapple Upside Down Cake – So bad economic news in USA turns into good news for stocks because it means more Fed printing and dumping.

Repeat From Friday – The Black Box/High Frequency Traders are now going to get some resistance from what’s left of regular traders/investors (the other 20 to 50% of stock traders) and they are worried.

  • Insider selling is at all time high.
  • S&P is at major resistance – this years high.
  • Many Oscillators and Indexes are showing overbought US markets
  • Our own MO while not in overbought territory yet is the highest in over a month.

US stocks used to be controlled by normal investors and traders – If it still was I’d be ducking, covering & selling big time.

Employment numbers for last month on Friday +151,000 jobs rate (positive surprise) & a continued -9.6% unemployment rate More here

Significant Indexes

  • The Dollar (USD) [Anything daily price move over +/- 0.50 is significant. Dollar usually moves inversely to stocks] The dollar rose a significant +0.94% yesterday. Dollar broke its support level last week,but on Friday is back to the same resistance level (Remember its called support on the way down and resistance on the way up.) Trend for stocks = Bullish
  • The Baltic Dry Index (BDI) [measures cost of world trade. Also proxy for China, emerging markets,&  exporting countries]Fell  -0.61% Friday. BDI now consolidating after bull run that began in June. The BDI has been overshadowed by the dollar moves. Sitting directly above major support. Longer term Pattern now= Bearish/Neutral
  • McClellan Index – (MO) [The rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks.] Fell slightly +35.51% Friday. Getting close to overbought (more NEUTRAL than bearish) = Bearish/NEUTRAL

Reading Tea Leaves.

The dollar bulls rules – This is because the Fed has announce it will print & dump $600 billion into economy. Maybe more or less depending on how the economy does. this puts strong pressure on dollar to go down. Other factors obviously influence currency markets, but right now QE 2 (print and dump $) is the bull in the china shop.

Watch tracking stock for dollar - UUP during day and keep an eye on MO nearing overbought levels. However for the short term -

Short TermStocks are way over extended. I’ve never seen major indexes trade above their Bollinger Bands for more than 2 or 3 days before falling. We have two days in a row above these bands. Another way of putting this is we are far too extended above 50 day moving average. Everyone who believes in technical analysis knows about this Bollinger Band stuff and they and are telling those they advise to sell.

Positions

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

(I do manage 6 accounts that have other positions)

  • EWS (Singapore)
  • SSO (2x what S&P does) Sold 1/2
  • EEM (emerging Markets)
  • TYH (3X tech stocks) Sold 1/2
  • DGP (2x gold)

The more highly leveraged the ETF is the more it is a shorter term trade (days/weeks) instead of a longer term investment (weeks/months) DGP is the ETF most likely to turn into an investment.

One strategy has been to lock in 5 to 10+% profit on the trades by selling 1/2 the ETF when/if it reaches those levels.

Traders would need a dip in MO before nibbling some more.  Investors, preferably, would like an MO of near -60 or higher before investing. Traders anything close to zero (highest risk) to -30 on MO

However first concern for traders is to lock in profits or keep tight stops on stocks and highly leveraged ETF’s.

Personally – I’ll probably  be  selling today, hopefully into an AM rally, the rest of the leveraged ETF’s. and perhaps 1/2 gold. I know MO is not at +60, but, the Bollinger Band/over extended from 50 day moving average means a short term reversal/consolidation. .

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.”

Announcements of purchases/selling can first be seen in the comments section of the blog and/or if you are on the private mail list. If you’d like to get on mail list send me an email – see HELP/EDITOR section of blog

Longer Term Outlook - CAUTIOUSLY BULLISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

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October 12, 2010

QE 2

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

QE2 leaving southampton water.jpg

No Its NOT Either One

Quantitative Easing 2

What the hell is QE 2 and why is it so important to YOU?

Background – Back in 2008 our no rules economic capitalism (Some call it casino capitalism others the “free market”) brought us to the brink of disaster. Back in 2008 Investors411 stated the economic situation here was “far far far far far worse” than anyone expected.

There have been four major money dumps or solutions to prevent a Great Depression in the USA. Other countries have had their own money dumps.

  • TARP
  • Stimulus Plan
  • QE 1
  • QE 2

Simply put the Fed is again in the middle of another massive money dump or printing money. Between QE #1 & 2 we are talking trillions of dollars. The Fed has implied it will do whatever it takes to keep the economy afloat. So who knows how long the QE 2 will stay in effect.

What happens when you inject this cash is the dollar falls in value and in the future inflation becomes a problem. One example/impact is the globalized value of your home falls. Japan has already started to play the same game. Europe and Great Britain will probably follow. This is why people are buying gold because it sure looks like QE 2 to is going full speed ahead and is soon to be followed by other ships/countries

Will QE 2 work? Hindsight is wonderful and so far there has been NO second Great Depression.

The opaque US Financial Institutions that benefit from these funds have not been forced by congress to become transparent capital entities. (see past Investors411) So its impossible to venture a guess behind all the smoke and mirrors other than these shadow institutions have been given a mountain of money to fill the huge hole they dug.

What I can tell you is to watch the dollar’s fall. Its now at $77.44. Last year’s low was just above $74 and the 2008 low above $71. That’s the last two lines in the sand that everyone’s watching. A more lasting impact of all this printed money is inflation. Of course, the falling dollar has led to a rising stock market. Many think this is another bubble.

America’s strength has been the vibrancy of her democracy and capital markets. When democracy and capital markets become less transparent and money flows become hidden or restricted to an oligarchy or unbreakable monopoly then all America suffers.

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

Index Percentage Volume
Dow +0.05% down
NASDQ +o.02% down
S&P +0.01% down
Russell 2000 -0.01% -

Technicals, Fundamentals & Analysis

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

US Stock Markets -

Yesterday’s semi holiday was like watching paint dry on for US indexes. Extremely light volume was typical of Columbus day and the fact that many investors have left the stock market over the year

There are lots of other technical indicators out there besides the one Investors411 focuses on (The MO) that show markets are overbought.

The benchmark S&P 500 is about 5% from yearly high and many emerging markets that have lead this rally are at new highs.

Repeat from yesterday – Fundamental Outlook on Wall Street“The concept of a double-dip recession has been replaced with slow and steady improvement, and even if we don’t get it, we have a Federal Reserve that’s ready to step in and support the rally,”said Art Hogan, chief market analyst at Jeffery’s.

Earnings season gets its first major report  after today’s close as tech giant INTC (Intel Computer) announces.  How the market digests this news is often a decent forecasting tool for the next few weeks.

Significant Indexes

  • The Dollar (USD) [Anything daily price move over +/- 0.50 is significant. Dollar usually moves inversely to stocks] The dollar rose +0.34%  yesterday. Yesterday’s action slightly bearish for stocks but overall trend of falling dollar trend is = Bullish
  • The Baltic Dry Index (BDI) [measures cost of world trade. Also proxy for China & emerging markets] Fell a smidge -0.04% yesterday An 8 week bull run, then a two week fall. A week long rally flattens out.  = Bullish/Neutral
  • McClellan Index – (MO) [The rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks.] Fell slightly to to +18.62. Still lots of room to move higher or lower. Location= NEUTRAL

Reading Tea Leaves

Earnings Season has the juice to alter the bulls stampede. We’ll have to wait to see what’s in INTC’s reports and how Wall Street reacts to have a better picture.

Otherwise the same bullish pattern dominates.

Positions

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

(I do manage 6 accounts that have other positions)

  • EWS (Singapore)
  • USO (price of oil/commodity).
  • SSO (2x what S&P does)

Check out Paul R’s always enlightening updates on individual stocks and sectors in the comments sections.

Longer Term Outlook - CAUTIOUSLY BULLISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

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April 6, 2009

Market Updates – In the Matrix

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

Obama in the Matrix – Everyone is taking shots at Barack/Neo, but…. Military budget gets announced to fearful Americans fighting the Evil Empire. The two, Two Cows – understanding AIG and Market to Market accounting with humor. They are back – after 101 years of trying – will they succeed?

photo from About.com: political humor

Obama in the Matrix

Obama is being totally dissed by the right that wants him to fail. Even lefties like Nobel Prize winners like Krugman  &  Stigletz as well as this blog are taking some shots at his administration. But his poll numbers remain high and USA Today headlines Obama’s trip to Europe as a “Success”

Military Budget

Today’s the day the Pentagon budget gets announced.

Lots of us hoped our paranoid country that spends what the entire rest of the world does on weapons would cut back just a wee bit this year. But alas our 3% of the population has to be armed and ready to fight the rest of the world. You thought only the NY Yankees were the Evil Empire, but to fearful Americans the rest of the world is still the Evil Empire. Well, Obama is giving the Pentagon less than they asked for, but more than last year. Another record budget story

The Two Cows


cows.jpg

photo from Clusterstock

John Carney  has some easy to understand, humorous ways to comprehend, both the Mark to Market and AIG using two cows. You can spend hours reading different editorials, like me, and still have a zillion questions, or simply skim his two, two cow stories. 

101 Years

Finally – Spring is in the air and that means the professional game of baseball that started in 1870 will be filling dozens of stadiums with thousands of excited fans. The dreaded evil empire, the New York Yankees, will once again take on the forces of good – the beloved Boston Red Sox.

The major Major league baseball story is about the team that will field nine players as they have for the last 101 years without winning a world series – The Chicago Cubs.

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

 

Stocks

 

Index Percentage % Volume
Dow +0.50% down
NASDQ +1.20% down
S&P500 +0.97% down
Russell2000 +1.32% -

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Technicals & Fundamentals

 The major indexes rallied for the 4th day in a row Friday. Volume fell, but we’ve already had 4+ “confirmation” days (day when there is both a significant rise in price and volume) since the rally began about a month ago. Another confirmation day at this point is moot. 

Key major index to watch is leading NASDQ - closed at  1622.(click on  charts at side of blog) Well above the  support levels of 1587 & 1598. Technically this breaks the series of lower highs on the leading NASDQ. That’s the first break on any of the major indexes for many many moons. 

Earnings season begins this week.

Rotation is still one key to watch. If other major sectors start to outshine financials (XLF) its a strong indication that in the short term the rally will continue.

Baltic Dry (Sea) Index - (see chart link on side of blog)  

Since 3/10 the BDI has fallen each day and yesterday was again  no exception. Another @-2.0%  Total loss from high more than 32%. How many days in a row can an index fall?

Bottom Line - If the flow of goods between countries continues to fall, so too will stock markets across the world. Unless we start to see some sort of rebound in the BDI a longer term rally in stocks is dead.

Correction: Real unemployment rate - includes discouraged workers etc15.9%. not 15.6

Reading the Tea Leaves -  Same as Friday – The gift of less transparency or the removal of Mark to Market accounting will help the giant over leveraged “Shadow Banks/Institutions”  That in addition to all the free money shoveled upon them will, hopefully, get them to make loans to businesses.” 

Longer term watch the BDI, if it keeps falling so will worldwide stocks. Trade drying up is a sign that protectionism is growing and less money flowing between countries. Like it or not, this is a globalized word and if money stops flowing between countries so will profits & jobs. It might be a week or three before the BDI impacts stocks, but trade is vital to improving all economies.

 


Long Term Outlook CAUTIOUSLY BEARISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog 

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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March 13, 2009

Market Updates – Opened a Can of Whup Ass

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

The Bulls retake the mother of all support/resistance levels. Are the Bailout Banks lying? Why Pakistan’s lawyers matter to you. Obama’s gets earmarked. Why you should date and not marry stocks and who got clobbered last night in the Jim Cramer (CNBC/financial channel) vs. Jon Stewart (comedy central) Showdown.

Jim Cramer, Jon Stewart
CNBC Photo/Giovanni Rufino; Kevin Fitzsimons/Comedy Central
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Opening a Can of Whup Ass


Jim Cramer and the financial channel got roasted, toasted and devoured last night by Jon Stewart.  Even Cramer on his 6:00 PM EST Mad Money show fessed up to the whuping that eviscerated financial reporting on CNBC.  The #1 financial channel has for years been little more than the head cheerleader of the unregulated capitalism and debt.   For more see E news story or video at Comedy Central
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Are Bailout Banks Lying? 

(See comment section comments by Robert H)

The old joke applies – How do you know a banker’s lying? -His/Her lips are moving
Answer – Yes and No.  It all depends on the accounting method. These bailout banks are borrowing money from the taxpayers and Fed for nothing and making a killing every time they loan the money out.  However, most have huge amounts of growing over leverage toxic assets that they do not want counted on the books. By standard mark to market accounting most major banks, like Lehman Brother, and AIG are insolvent.
 Looks like Congress (major hearing yesterday on this) will “relax” mark to market accounting. Full story from Financial Times
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Pakistan’s Lawyers March

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Afghan/Pakistan is the center of Islamic terrorism. It has been that way for over a decade. Many brave lawyers are marching from all over Pakistan to protest the government not reinstating the Supreme Court that was dismissed under the dictatorship. Aljazeera reports on the long march for justice.
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Obama get Earmarked

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Barack blew it when he approved a budget that contained almost 2% earmarks.  OK some of these earmarks are relevant, but the focus was suppose to be on creating jobs jobs, jobs then energy, health care and education, not congressional members pet projects. Story from MN Star Tribune.

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

Stocks

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Index Percentage % Volume
Dow +3.46% down
NASDQ +3.97% up
S&P500 +4.07% down
Russell2000 +6.50% -

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Technicals & Fundamentals

US and many world markets rallied again.  This time volume did NOT confirm the rally.

The Mother of All Resistance/Support Levels Falls Again -

Benchmark S&P 500 area @ 741 was retaken by the bulls. SPX closed at 752. (see Investos411 posts for end of Feb for more on this critical  technical support level) Remember its called support on the way down and resistance on the way up.

This is very significant , especially in the long term.  We broke down through the 2003 support level for about two weeks. When you think in terms of months or years the last two weeks is just a crack.

The longer we can trade above 741 the better it is for the bulls. If we can hold above this level for a week, the long term Outlook will be upgraded to Cautiously Bearish

Why You Should Date and Not Marry Stock Markets

One word – Voilitilaty.  

What’s happened is an oversold market rally. We’ve had two rallies that have gone up @20% since October. This one is a little over 1/2 way to that 20%.  The falling volume yesterday is a technical reason to worry.

But short term bullish signs are abundant -

  1. GE’s bond rating was cut yet GE was up 12%. Major companies and markets moving higher on bad news is very bullish. 
  2. Even more important is the willingness of congress to drop Mark to Market rules (see above). XLF the financial sector ETF (up 10+% yesterday) is on fire because banks will NOT have to show or mark to market their toxic assets. 
  3. The breaking of the benchmark S&P 500 – 741 resistance/support level

CAUTION: All the old problems still exist.  Technically ,retesting the bottom (an ominous 666 on the SPX) is more likely than not.

But right now ride the wave. Two days ago Investors411 suggested it was time to “nibble” again (for investors with large cash positions)  

Best Guess – flat day and rally continues next week. But, if volume continues to fall duck and cover.

Ben Bernanke will be on TV show 60 Minutes this weekend

 

Long Term Outlook = BEARS RULE

See STRATEGY, POSITIONS, OVERVIEW  & ARCHIVES sections of blog for more

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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January 23, 2009

Market Update – Burst of Executive Sunshine

Author: Barr Jozwicki - Categories: Obama, Politics - Tags: , , , , , , , , , , , , , , , , , , , ,

Obama’s first two days are "a burst of executive sunshine " and "transparency".

Here’s 10 of Obama’s orders and/or acts

#1 Closing Guantanamo within a year
#2 Stopping the unfair and unconstitutional trials there
#3 Directing federal agencies to err on the side of transparency and not the Bush delay/secrecy over public records.
#4 tough new limitations on power of lobbyists
#5 Countered Bush’s order that allows past Presidents and VP to keep potentially embarrassing order from the public.
#6 Barred anyone in his administration from leaving and becoming a lobbyists while he is in office
#7 No one can serve in Obama administration who was a lobbyist over past two years.
#8 Both Obama and his future AG declared waterboarding "torture" and prohibited.
#9 Appointed competent top level envoys to Mideast and Afghanistan/Pakistan (Mitchell and Holbrooke) as negotiators.
#10 Spoke to all Mideast leaders (minus terrorist group Hamas)

George Washington and company when confronted with a massive foreign army not only won the day but came up with the Declaration of Independence, the Constitution and Freedom. George Bush when confronted with a small band of religious terrorist – declared war on secular Iraq, denied some basic freedoms that Washington had won and created far more adversarial and confrontational world – "You’re either with us or against us."(I know you could add to this list)

Certainly Obama is going to make mistakes, but its heartening to see America move back in the direction of our founding fathers.

Stocks.

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Headline – Major Support Level Cracking

Index % Change Volume

Dow -1.28% up
NASDQ -2.76% ?
S&P500 -1.52% ?
Russell2000 -3.05% –

Brown = same comments as yesterday.

US Market & Foreign Markets

Technicals – Sorry could not accurately read volume figures on charts. Looks like volume was above average and flat. Because there was no significant increase volume, the #1 confirmation factor behind a price move, tells us little. Stocks were much lower but recovered some losses by the end of the day.

XLF is the financial sector ETF Chart here. As the chart shows financials after two huge swings (down then up) lost -6.35%. While this is a substantial amount it is not close to the 15% swings of the previous two days.

The financial sector is currently leading the US and world markets. Overall even though we had a massive gain yesterday the XLF has a multiyear series of lower lows and lower highs (change setting on chart to weekly to see this) – Technically this chart is about as bearish as you can get. In the shorter term a major move like yesterday’s in big volume indicates at least a short term low.

The area around DOW 7950 to 8000 is turning into a strong support level. The more times its tested and holds the stronger it becomes. Of course, this also means if it breaks down we should have a major fall.

For those of you who like to invest in individual stocks internet advertising and education stocks are doing well.

Chart of the benchmark S&P 500

Chart of the Russell 2000

Chart of the NASDQ

Chart of the Dow

Fundamentals -

MSFT fell over -11% yesterday (poor earnings report). When you consider this and the bad unemployment/housing figures and slowing +6.8% China GDP growth, the markets did a bit better than expected.

The emperor of internet advertising Google beat earnings expectations last night and was up 4+% in after hours trading. Now up +1.3% 9:22 EST

Another giant GE earnings met expectations (a loss of 44%) Analysis of their troubled financial unit. So much of GE’s business comes from financial part of business and it is way over leveraged. GE is down this AM.

Forecasting Future Trends

LIBOR LIBOR is the rate banks charge each other . It price has fallen from 3.4% three months ago to about 1.16% Its held steady in this area for about a week. (good news for stocks)

LIBOR chart (3 month)

TreasuriesT Bills yields show how fearful investors are. The lower the rate the more the fear. Short term yields – 3 month T bill fell to 0.07% and the longer term rates rose a bit. The ten year rose 2.58% (low yields show fearful investors flooding to Treasuries instead of stocks)

Treasury Bonds chart

Baltic Dry Index – Measures flow of goods between countries. Yesterday ir rose again 5+% . Almost 85% drop since June. (We’ve had a solid gain since the early December lows of around 660 to 945, but we fell from pre recession figures of around 12,000 – That’s along way to go)

BDI chart

Short Term Outlook/Strategy

Reading the Tea LeavesStrategy – Shorting rallies to protect gains is working. (see below) Until we see some light at the end of the recession tunnel VOLATILITY continues to be the most predictable major stock market trend. Obama rally (stimulus package) is holding up equities right now.

All three forecasting indexes are beginning to indicate a positive move for stocks.

LIBOR has fallen significantly and even mortgage rates have fallen. Treasuries while low are starting to rally and we have seen a significant move higher in worldwide trade (the BDI) Looks like a stock rally is possible. Overall PANIC does still rule the credit markets, but it is easing.

Financials are the problem and will be until the toxic debt question is resolved. Could take years for this to happen. But now with a new administration there is hope. Hope of future transparency, accountability and rules in this area are vital for the economic health of the US and the world.

The other major negative is the employment numbers.

The Dow is hanging in at 8123. Still above its major support level. Even though there are some positives out there, Financial Companies and Employment numbers are overwhelming investors. Bad earnings reports like MSFT led to an 11% decline. This means that bad news is NOT built into market prices. The strong 7936 to 8000 Dow support level is in danger of collapsing today. You can feel a major downside move building.

Financials/Banks are in a lot of trouble with no resolution of their toxic assets in sight. Dow 7449 is last year’s low and the next major support level.

Long Term Investors who can handle risk and are less than 10% invested in stocks – Nibble a little on any major dip. Shorter term investors keep protection (short ETF’s) for now. You may want to drop some as we get closer to 7449.

AS ALWAYS DO YOUR RESEARCH BEFORE INVESTING

Long Term Outlook – BEARS RULE

Changes to Bottom Line Section Bolded and in Plum or crossed out

Technicals – Series of Lower Lows and Lower Highs = Bears Rule.. Technical Range for 2009 – 7449 (low) and 9654.- This is a wild guess. Any sustained move above Dow 9650 is bullish.

Fundamentals – Financial transparency/accountability problem is far far far far far far far far far bigger than anyone thought. It’s looks like the recession will last through 2009 – perhaps longer Cleaning up this mess is going to take years and growth will suffer.

Asset Allocation/Recommended Sectors (long term)

50% to 90% Cash – Long Term Investors (up to 15 to 25+% stocks – only buy big dips) Wait for the next big dip to add 5 to 10%
Be Cautious and PROTECT YOUR MONEY (use ETF’s that short major indexes) when stocks have a big rally

*5+% US Index Funds
UWM (ETF that does 2x what Russell 2000 does) & QLD (ETF that does 2X the NASDQ ) DDM (ETF that does 2X the Dow ) SSO (ETF does 2X the S&P 500)

*5%+ Emerging Markets
EWZ (Brazil) should out perform other emerging markets in a rally and under perform in a fall – highest risk and dependent on oil prices
FXI (China ETF) should outperform USA

*5%+ Alternative Energy
GEX(Alternative energy ETF) Obama administration will focus on this area

*5+% Gold
GLD is the ETF for gold-

Chief Strategy – Buy the DIPS of trending sector – This is not your father’s buy and hold market – over the 8 Bush years the Dow has gone from 11,000 to 8000 and huge uncertainty clouds the future.

The major trend now is volatility.

Traders who have a strong tolerance for risk jump in on dips and invest more. Sell and/or go short into major rallies. Long term Investors who can tolerate risk and are 100% in cash nibble just a little on big dips. (5% on each big dip) Do not buy into rallies.

Shorting – Three ETF that short 2x what the major indexes do.

SDS – ultra short S&P 500
DXD – ultra short Dow – (Both small caps and tech stocks are outperforming the DOW and S&P)
SKF – ultra short Financials (this is the sector that’s most broken)

As Always Do Your Own Research Before Investing

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January 6, 2009

Market Update – 2009 and YOUR money

Author: Barr Jozwicki - Categories: Future Trends - Tags: , , , , , , , , , , , , , , , ,

2009 Call

This is not your father’s "Buy and Hold" market . 2008 huge losses and the unpredictability of the future shows no safe trends except volatility. Therefore, we can use volatility as an investment tool until some clear longer term patterns become established. This does mean you have to pay more attention. After stocks rally (Dow +5 to 10%) buy an ETF that shorts to protect your gains.

The range prediction in the Bottom Line section is between the 2008 low 7449 and the November high of 9654 . This is just a wild guess based on technical factors. Volatility could easily move stock prices above and below these levels.

Tomorrow we will go over specific sector (ETF’s) to invest in and why.

2009 Economic Problems

Investors basically look 6 months into the future and if they see signs or have confidence that the situation will improve then they will start investing again. This is not going to happen quickly because many have had close to 40% of their portfolio’s wiped out and there are some dark clouds on the horizon. Here’s a list of some of those clouds.

#1 – Financials/Banks are still over leveraged. There is easily over $10 trillion of over leveraged debt (credit default swaps) that has not been written off.
#2 – Transparency – There is none. TARP has thrown money at banks, but there has been no accountability.
#2 – Mortgages – The number of people defaulting on mortgages is going to grow and overall housing prices continue to decline.
#4 – Unemployment rises – It looks like the unemployment figures will reach 8+% this year.
#5 – This mess took decades to create, it will not be solved overnight.
#6 – Clearly recession is a worldwide problem. This could lead to more problems like protectionism and sink us further into a hole.
#7 – We entered this disaster with both a huge trade and federal deficit.

The good news is that stocks have fallen a long way and many of these factors are in some ways built into equity prices. Technically it does look like stocks have made a bottom around Dow 7500.

Like Tinkerbell believed in Pete Pan you have to believe in Obama’s economic approach and your fellow Americans for an economic recovery. The "free market"/Ayn Rand zealots that lead us into this disaster could easily again take control. Critical to all of this is a housing recovery. China relative stability and continued growth could help lead us out of this mess.

Back to Politics Tomorrow

Stocks.

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Headline – Obama Rally Part 2

Index % Change Volume

Dow -0.91% up
NASDQ -0.26% up
S&P500 -0.47% up
Russell2000 -0.16% –

italics = same comments as yesterday.

US Market & Foreign Markets

Technicals – After a rally, when markets basically go nowhere and volume increases, the end result is usually a reversal of trend. Technically what’s happening is the bulls and the bears are having a big fight at the Dow 9000 resistance level and one side is going to run out of troops (the increased volume) More often than not the trend reverses because the (in this case) the bulls used up so many troops (buyers) to get to the resistance level.

Bottom Line – today is significant because it will probably set the pattern for the next few days. We have in the last month established a range between @ Dow 8500 and 9000. Both the 8500 support and 9000 resistance have held.

If we can hold onto gains this week, another leg higher is very possible. Next major resistance level is around Dow 9650. See charts.

Chart of the benchmark S&P 500

Chart of the Russell 2000

Chart of the NASDQ

Chart of the Dow

Fundamentals-

Obama Rally = HOPE A whole bunch of stimulus that has already been thrown at stocks, plus the composition of Obama’s economic team & his proposed stimulus package.
Earnings season begins in a weak or two and usually the next week or two warnings impact stocks.

Three Month Treasury Bill & LIBOR

Credit markets are the dog and the Stock Markets are the tail. Without credit the tail won’t wag.

Real progress is being made. LIBOR continues to fall 3.4% two months ago to about 1.42% LIBOR rates have fallen significantly. LIBOR is the rate banks charge each other, not businesses. Some credit cards, loans and mortgages are tied to LIBOR so this is good news. Some credit cards & mortgage rates are tied to Fed prime rate.

LIBOR chart (3 month)

Treasury Bonds

The 3 month T Bill fell to 0.04% Shorter term yields fell. Longer term rose yields rose. The 30 year T bond rate is back above 3%. Slow but moving in right direction.
Fearful investors are putting their money in Treasury bonds for 3 months to 30 years, they are NOT investing in stocks. Investors are willing to pay an unbelievably low 2.48% for a ten year treasury bond.

Yields keep falling = Continued deterioration of credit market. Low Yields = There is simply NO confidence in the credit markets PANIC RULES

Baltic Dry Index

The Baltic Dry Index is a forward looking indicator that measures pre production materials that are shipped around the world. For better definition see LINK
Bloomberg data and chart LINK (If the link does not work Google – bloomberg baltic dry index) Set range indicator to one month and you will see this chart.

BDI flatted yesterday (-1) to 772 We have had a significant rally off the lows of @660 three weeks ago week.

Long term picture The BDI had seen an almost 90% loss since June. It seems, a least for a week international trade has picked up but has again begun to slowly fall. These shipping figures confirm world wide recession.

Short Term Outlook

Reading the Tea Leaves-

PANIC STILL RULES the credit markets.

Without credit and goods (BDI) flowing a long term stock rally is unlikely. However, Dow 9654 is a possibility. That is the number the Dow reached on around election day. The Obama stimulus plan (hope) dominates the investment news. "Buy the rumor and sell the news" is an old Wall Street axiom. Despite a technical breather the tea leaves indicate that we rally till the stimulus pakage becomes apparent.

Strategy – Volatility rules and a 6+% move higher in the Dow is a big move in a week. Personally will start adding some SHORT positions to protect the gains of last week. The higher we go the more short positions.

AS ALWAYS DO YOUR RESEARCH BEFORE INVESTING

Long Term Outlook – BEARS RULE

Changes to Bottom Line Section Bolded

Technicals – Series of Lower Lows and Lower Highs = Bears Rule. Obama/stimulus rally phase 2 is underway. Technical Range for 2009 – 7449 (low) and 9654.- This is a wild guess . Any sustained move above Dow 9650 is bullish.

Fundamentals – Financial transparency problem is far far far far far far far far far bigger than anyone thought. It’s looks like the recession will last through 2009 – perhaps longer Hopes of a more competent Obama administration have rallied stocks.

Asset Allocation/Recommended Sectors (long term)

50% to 90% Cash – Long Term Investors (up to 15 to 25+% stocks – only buy big dips) Wait for the next big dip to add 5 to 10%
Be Cautious and PROTECT YOUR MONEY (use ETF’s that short major indexes) when stocks have a big rally

*5-10% +% US Index Funds
UWM (ETF that does 2x what Russell 2000 does) & QLD (ETF that does 2X the NASDQ ) DDM (ETF that does 2X the Dow ) SSO (ETF does 2X the S&P 500)

*5%+ Emerging Markets
EWZ (Brazil) should out perform other emerging markets in a rally and under perform in a fall – highest risk and dependent on oil prices
FXI (China ETF) should outperform USA

*5%+ Alternative Energy
GEX(Alternative energy ETF) Obama administration will focus on this area

*5+% Gold
GLD is the ETF for gold-

Chief Strategy – Buy the DIPS of trending sector – This is not your father’s buy and hold market – over the 8 Bush years the Dow has gone from 11,000 to 9000 and huge uncertainty clouds the future.

The major trend now is volatility.

Traders who have a strong tolerance for risk jump in on dips and invest more. Sell and/or go short into major rallies. Long term Investors who can tolerate risk and are 100% in cash nibble just a little on big dips. (5% on each big dip) Do not buy into rallies.

Shorting – Three ETF that short 2x what the major indexes do.

TWM – ultra short Russell 2000
QID – ultra short NASDQ
SDS – ultra short S&P 500

As Always Do Your Own Research Before Investing

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December 23, 2008

Market Update – What Me Worry

Author: Barr Jozwicki - Categories: Recession - Tags: , , , , , , , , , , , , , , , , , , , ,

Going to London and Paris over holidays. May be able to send abbreviated Updates from Europe.

"Recession Plagued Nation Demands New Bubble to Invest In."

The above headline is from "The Onion" Sometimes humor tell the truth better than analysts. After an internet and housing bubble American’s are looking for the next Ponzi scheme.

Nobel prize winner Paul Krugman expects "were in for months, perhaps a year of economic hell ."

Paulson and Bernanke as Heroes

In the past few month Updates has spent a lot of time punching holes in the TARP bailout and other financial moves. The government loans/bailouts have been termed "Not accountable," "did not fix the lack of regulation problem," "not transparent," "arrogant" and "what looks like Paulson giving $ to cronies (banking buddies like Rubin)" While there is a clear negative side the actions taken it does not necessarily add
up to failure.

Herbert Hover failed to act. He let bank after bank go under and the end result was the Great Depression . When Lehman Brothers failed this year the almost $400 billion of bad over leveraged debt shook countries and banking systems worldwide.

Twice the entire world economic/financial stood on the brink of the abyss.

  1. The AIG bailout. The world’s largest insurance collapse would have taken down the entire insurance industry. AIG was/is overloaded with credit defaults swap obligations. – just like Lehman.
  2. The TARP financial/bank bailout and the second bailout to the world’s largest bank Citigroup. Again Citi and banks are over leveraged with obligations like credit default swaps.

Paulson and Bernanke have not fixed the problem - but they have kept the entire world’s financial system ticking . The ships been hit by an iceberg, but it is still afloat. Bernanke and Paulson do deserve some credit.

Solutions

There are many. Some of the more obvious ones

  1. We need laws to regulate financial companies, – free markets and especially Financials (credit default swaps etc.) need some structure or else they go wild.
  2. The over leveraged situation needs to get reduced.
  3. Temporarily stop building houses or find some other way to stabilize housing/foreclosure market.
  4. Stimulus – This worked for FDR until he tried to balance the budget too soon in 1937. Then he needed the a huge stimulus package (WW 2) to ultimately fix things.

"What Me Worry" Alfred E Neuman

Huge financial entities (domestic and foreign) knees are trembling with worry.

  1. Banks are not loaning money – they are probably over leveraged and need the cash just to stay in business.
  2. Big money is all hiding in Treasury Bonds. – the Yields are ridiculously low
  3. Corporate bond yields are ridiculously high – this means a whole mess of defaults should happen in the future.
  4. Check out the drop in the Baltic Dry Index (see below)
  5. We’ve entered this mess with an already huge deficit.

Hope Krugman is right and "we are in for months, perhaps a year of economic hell" and not something worse.

Stocks

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Headline – Still Consolidation
Index % Change Volume

Dow -0.69% down
NASDQ -2.04% down
S&P500 -1.83% down
Russell2000 -2.30% –

italics = same comments as yesterday.

US Market & Foreign Markets

Technicals-

This week and next have historically had light trading. Also the next three weeks have historically been positive.

The shorter term mojo is still with the bulls until stock’s close below their opening price on last Tuesday. This area just above 8500 held for three days in a row (last Friday, Mon. and Tues.) and is a short term support level – 8500

The Dow fell below 8500, but rallied to close above it at 8517 So technical support while threatened, held yesterday.

Today again will be a test of this level.

Chart of the benchmark S&P 500

Chart of the Russell 2000

Chart of the NASDQ

Chart of the Dow

Fundamentals-

Obama Rally = HOPE A whole bunch of stimulus that has already been thrown at stocks, plus the composition of Obama’ economic team & his proposed stimulus package.

Lots of down grades of companies by brokers was most cited reason stocks fell yesterday.

Here’s about a disastrous an outlook as I can find from a self described Dr Doom and Gloom .

Three Month Treasury Bill & LIBOR

Credit markets are the dog and the Stock Markets are the tail. Without credit the tail won’t wag.

Real progress is being made. LIBOR has fallen from [MISTAKE 4.8 is the European LIBOR rate high 3.4% is the US high] two months ago to about 1.46% LIBOR rates are on their second leg down and have again fallen significantly. LIBOR is the rate banks charge each other, not businesses. Some credit cards, loans and mortgages are tied to LIBOR so this is good news. Some credit cards & mortgage rates are tied to Fed prime rate.

LIBOR chart (3 month)

Treasury Bonds

The 3 month has basically flatlined at 0.01% Longer term rose yeilds rose slightly

Fearful investors are putting their money in Treasury bonds for 3 months to 30 years, they are NOT investing in stocks. Investors are willing to pay an unbelievably low 2.17% for a ten year treasury bond.

Yields keep falling = Continued deterioration of credit market. Low Yields = There is simply NO confidence in the credit markets PANIC RULES

Baltic Dry Index

The Baltic Dry Index is a forward looking indicator that measures pre production materials that are shipped around the world.

Bloomberg data and chart (If the link does not work Google – bloomberg baltic dry index) Set range indicator to one month and you will see this chart.

BDI fall more than -2% yesterday to 801. We have had a significant rally off the lows of @660 two weeks ago week, but again have started to fall. Big long term picture The BDI had seen an almost 90% loss since June. It seems, a least for a week international trade has picked up but has again begun to slowly fall. These shipping figures confirm world wide recession.

Dollar Falling

Dollar was flat yesterday.

Wild ride over the last three weeks – especially last week. Basically, the dollar has gone from a high of $88 to low of $78 and at the end of the last
two days setteled at $81. These are historically big moves for the dollar. Chart.

The dollar is falling because of the low US interest rates and it looks like the Fed will bee printing a whole lot of $ to keep the financial system liquid.

Short Term Outlook

Reading the Tea Leaves-

PANIC RULES the credit markets and its hard to see money flowing into stocks while so many potential investors are putting $ in treasuries at ridiculously low rates. Long term stock rallies simply do not have the money supply to exist as long as the credit panic continues.

Dow 8500 is the technical support level that’s closest and 9000 is the upside resistance level.

Historically the markets turn before the economy, however fundamentally its hard to see signs of any long term economic turn.

Hedges

As I’ve discussed with many of you, personally I am long (bought lots of) FXI (the China ETF) and I’m hedging it with a short position in US equities – SDS or others listed below. The higher FXI gets the more I hedge. The lower it goes the less I hedge.

AS ALWAYS DO YOUR RESEARCH BEFORE INVESTING

Long Term Outlook – BEARS RULE

Changes to Bottom Line Section Bolded .

Technicals – Series of Lower Lows and Lower Highs = Bears Rule. Obama/stimulus rally part 2 seems to be taking hold. Look for range between 7449 and 9654 for rest of year .
Fundamentals – Financial transparency problem is far far far far far far far far far bigger than anyone thought.

It’s looks like the recession will last through 2009 – perhaps longer Hopes of a more competent Obama administration have rallied stocks.

Asset Allocation/Recommended Sectors (long term)

50% to 90% Cash – Long Term Investors (up to 15 to 25+% stocks – only buy big dips) Wait for the next big dip to add 5 to 10%

Be Cautious and PROTECT YOUR MONEY (use ETF’s that short major indexes) when stocks have a big rally

*5%+% US Index Funds

UWM (ETF that does 2x what Russell 2000 does) & QLD (ETF that does 2X the NASDQ ) DDM (ETF that does 2X the Dow ) SSO (ETF does 2X the S&P 500)

*5%+ Emerging Markets

EWZ (Brazil) should out perform other emerging markets in a rally and under
perform in a fall – highest risk and dependent on oil prices

FXI (China ETF) should outperform USA

*5%+ Alternative Energy

GEX(Alternative energy ETF) Obama administration will focus on this area

*5+% Gold

GLD is the ETF for gold-

Chief Strategy – Buy the DIPS of trending sector – This is not your fathers market – over the 8 Bush years the Dow has gone from 11,000 to 8,500 and huge uncertainty clouds the future.

The major trend now is volatility.

Traders who have a strong tolerance for risk jump in on dips and invest more. Sell and/or go short into major rallies. Long term Investors who can tolerate risk and are 100% in cash nibble just a little on big dips. (5% on each big dip) Do not buy into rallies.

Shorting – Three ETF that short 2x what the major indexes do.

TWM – ultra short Russell 2000

QID – ultra short NASDQ

SDS – ultra short S&P 500

As Always Do Your Own Research Before Investing

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