2010 Future?

Pakistan, Iran, Iraq, China and Future Wars

The NYT is carrying an ominous front page story on 3 Americans dying in Pakistan . And you thought there were NO US troops in Pakistan.

How the Pakistan media portrays the US – 123 civilians killed & 3 al Qaeda fighters in drone attacks January. US to increase drone attacks by 75% Only 9% of Pakistani’s support these drone attacks. The opposition Muslim party is by far the now the most popular and their mantra is “Go America Go ” – Hint – they are not cheering us on, but telling us to get out.

Combine this with our growing problems in Yemen, Iran & China (see yesterday’s Investors411) and 2010 is shaping up to be another year where animosity between the US and the rest of the world grows. Recently the NYT reported that over 30 other US companies besides Google were hacked in China. The China/US economic relationship is key to the growth of their and the world’s economic well being.

Check out Popeye’s comments on right of blog. I’m certainly not as strongly anti Obama as he is, but he brings up some good points. Especially, the American media failed to mention that NATO refused to send 10,000 more troops to Afghanistan.  Once again another “coalition of the willing” seems to be breaking down.

Perhaps the real reason for the troop escalation in Afghanistan is preparation for an invasion of Iran . We now will have over 100,000 troops on both sides of Iran – In Iraq & Afghanistan. Best blog for educated inside information continues to be Prof.Coles Informed Comment

Bottom Line Trend2010 looks to be a year of growing instability with the US and the rest of the world. This could have a negative impact on stocks.

KISS & Stocks (Keep It Simple Stupid)

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


Index Percentage Volume
Dow +1.09% up
NASDQ +0.87% up
S&P500 +1.30% up
Russell2000- +0.79% -

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

Technicals, Fundamentals & Analysis

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

US markets rallied significantly again.  This time volume increased and was just above average. Increased volume is what bulls love to see in a 1% or greater rally. But these figures were not the BIG volume bulls want to see and were there when stocks fell over the last few weeks.  So far we have an oversold bounce . Time will tell if it develops into anything.

The major event of this week will be the Monthly jobs report at the end of the week.

February is historically a BAD month for stocks.

Markets had every reason to tank as Obama economic adviser and legendary Fed Chair Paul Volker spoke in front of the Senate Finance committee about breaking up too big to fail banks. Instead, stocks move higher.  Much needed financial reform of the shadow banks looks DOA to investors.

Significant indexes

  • McClellan Index at -21.79 = We’ve pulled way back from -90 or oversold levels two days ago.
  • BDI – This chart shows the Baltic Dry Index (scroll down) , a measure of shipping costs, Has broken through a major month long  support level at @ 3000 and is still falling. Yesterday the BDI closed at  2691.= Bearish – especially for China. More on this tomorrow)

Mistake – Unfortunately, I was away Thursday through Monday.  It looks like Thursday Friday when the McClellan Oscillator hit -70 then -90 was the time to buy.

Chinese stocks bottomed 5 trading days ago and are once again leading US stocks higher.  There is a disconnect or contradiction with the BDI falling. China, whose economy is both export and import driven, should see an INCREASING BDI when its markets grow.


The  Positions Section (also at top of blog) has the latest buys and sells (Usually updated over weekends – will try to update last few weeks today) – These are positions I actually own


Stock Watch List

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

  • SEED A China related stock. In a buy the dip position at 50 day moving average
  • AAPL - Apple’s latest product seems to be a bit of a dud. Former leader now under performing.
  • HMIN - Failed breakout . China play. Will recover when  China does.  Will drop from list soon
  • CAAS Broke down though 50 day, but has rallied last two days in STRONG volume. Tempting
  • PCLN Fell below 50 day moving average. Had a good pop in price and volume on Monday. Tempting
  • F Now less over extended. Too much recent down day volume. Tempting
  • DRWI - Big exporter to China -  Was way too overextended to buy, and now sitting on 50 day MA support level  No big volume as stock dropped= good sign. Buy the dip .
  • ENOC New – Reduces costs for utilities – No big volume behind its recent fall. Potential buy the dip .
  • ATHN New - Software reduces costs for health care - Broke its longer term bullish trend in big  volume – Will drop from list soon.
  • IMAX Great long term chart – falling back to its 50 day moving average. Outperforming overall market Still a buy the dip opportunity . Investors411 has a 2% of portfolio position in this stock

IMAX still rules. DRWI, SEED & ENOC seem to be the best of the rest. Would open position in any of these on an overall stock market dip.

Looking for a couple new suggestions to YOUR recommended list.

Long Term Outlook = NEUTRAL


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