Wednesday, December 29, 2010
12/30/10 In The Early Morning Rain
Out on runway number nine, big seven-o-seven set to go
But I'm stuck here in the grass with a pain that ever grows
You can't jump a jet plane like you can a freight train
So I'd best be on my way in the early morning rain
It's easy to feel left behind when the indexes take off without you. No worries, man. New departures every day, and none are non-stop. A few are round trip.
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Lightfoot 'Live in Reno' seemed appropriate. Vegas if you want glitter. Reno for straight-ahead hard play.
ReplyDeleteGood trading to all tomorrow, I'm gonna look for something to keep me preoccupied while trying not to watch too closely.
ReplyDeleteAnother take on 'The Wall Of Worry' newSubmitted by 2nd_ave (5106 comments) on Wed, 12/29/2010 - 21:18 #76774
ReplyDeletehttp://www.minyanville.com/investing/lloyds-wall-o...
'What's the newest concern in the air? Too much bullishness among investors.'
What's the final word- 1/2 day of trading on Friday?
ReplyDeleteI think we in fact move much higher in 2011. After a rough patch in January.
ReplyDeleteIt's supposed to be 13 degrees here tonight.
ReplyDeleteDavid- I've been engrossed in a television series (via NFLX) called 'The Wire,' based in Baltimore. The entire first season is recorded on 5 discs. Great footage of (generally the worst parts of) a city rarely seen on film. Xlnt writing.
ReplyDeletehttp://en.wikipedia.org/wiki/The_Wire
13? It's only dropping to 42 here.
ReplyDeleteThe SPX hits 1300 for sure by May yo. You feel me?
ReplyDeleteLooks like a full day Friday. Yeah, 13. At least that's what KRON just said.
ReplyDeleteAny of you guys follow CDII?
2nd- I think you need a break from that show :)
ReplyDeleteMark- There's a great sequence with two detectives measuring the trajectory of a bullet through a window, which ultimately results in recovery of both the slug and the casing (the two are muttering to themselves):
ReplyDeleteF---.
F---.
F---!
F---, f---, f---.
F----- A. F---!
F--- this. No f------ way...F---!
F---.
M-----f---! F---.
(Nods to himself) F--- me! F---!
Yeah, well it goes on like that for at least two minutes. Probably a cinematic first.
2nd- That sounds like after I said today, OK guys, who wants to work this Friday?
ReplyDeleteMos' def, man.
ReplyDeleteFF- Have you looked at LINE lately? AND the divy? Damn.
ReplyDeleteNice gap fill and double bottom in MOTR?
ReplyDelete13C => ((13*9)/5)+32 => 55.4F ;)
ReplyDeleteNo rocket man. It's F. Already 33 degrees. If nothing else, at least my UNG trade will go down in flames.
ReplyDeleteDid you take a look at CDII?
Mark....LINE.
ReplyDeleteWant to really get T'd off?
Remember the "flash crash"? It went to 12.38 that day. THEN add the divy.
As on 2nd's show, F_ _ _ ing F _ _ _ me motherf_ _ _ _ _! F_ _ _!
Sick chart on MOTR Mark. Double bottom on the weekly to boot.
ReplyDeleteDavid-
"the storage should be sky high by November 2011 and NG can temporarily drop to or below the 2009 lows of $2. At the same time, smart traders will be looking ahead to the winter with possible cold weather AND accelerating drawdowns due to steadily decreasing supply inflows and will be pricing January futures at $6. It will be a TOTALLY DEVASTATING contango."
I have no idea where the bottom is in natty (I placed a bet that we've hit it), but what you expressed in your post is the exact sentiment that I want to see at a natural gas bottom. As you know, at the top, there will be no extra natural gas to go around, people will be calling for severe shortages and $50 ng prices. At the bottom, people are/will be talking about the ocean of extra natural gas floating around and how natty companies can't give it away. I remember when I bought CENX in '09 at $1.07 when you couldn't give steel away. People were talking about steel dropping another 60%. That was the exact bottom and now CENX is up 16 fold. In fact, per sentimentrader, investor sentiment for natural gas has reached a bearish level last seen just prior to significant rises. The sentiment level for every (yes, every) other commodity is at a bullish extreme last seen prior to significant corrections. There are many potential "reasons" for a significant "unjustified" pop for natty. American $4 natty could catch up to European $9 natty, the historical 10 to 1 oil to natty ratio now sits at a historical high of 22 (reversion to mean?), the U.S. could announce a "surprise" partial/total ban on fracking, Congress could finally pas the energy bill switching vehicles and other machinery to natty.....the list of "surprises" can go on and on. Seems like everybody and his brother has seen the "sea" of natural gas for 2 years now. Maybe its priced in? Even in this flood of natty, with no bullish surprises as discussed above, it reached $6 a year ago, which would be a 50% return from here. I just read an article about a Russian natty company that literally sees an "explosion" of natural gas demand over the next decade. I have no idea where the bottom is, but judging by charts and sentiment, I would not at all be surprised to see a multi-bag explosion in the price of natural gas to catch everybody off guard. I could be 100% wrong. And I've been 100% wrong MANY times. Btw- tax loss selling 2010 settlement ended today so I wouldn't be surprised to see it continued to be bid up as investors jockey for '11. I just have a feeling. What's that saying about the market taking the least number of investors with it?
CDII - Didn't someone bring that one up a couple weeks ago?
ReplyDeleteI don't know anything about it....
I'm beat, g-nite all!
ReplyDeleteJust got an email from MOG. I'm taking my profits in MMR tomorrow. Drill results due soon. It could go either way, but from what he say's it will be VERY volatile. As crazy as I am, he scared me away. He's still long.
ReplyDeleteWas just looking at some long term charts of NG. Yeaer 2000 52 week low on Jan. 1- $2.15. 52 week high December 31st- $10. Not bad. Would be nice to see a repeat:)
ReplyDeleteSince it's that time of year, does anyone else want to participate in a little contest? Name your top 3 picks for 2011. As in the 3 stocks you think will return the most by 12/31/2011. I know RAS would be on my list...not sure about the other 2 but probably ACMR, NLS or REDF.
ReplyDeleteTop 3 picks of 2011-
ReplyDeleteGMXR-$5.45 2011 target $35-$40
HNU.to (HNUZF a few weeks ago but can't find it now) $6.31. 2011 Target $38.
DPTR $0.77 2011 target $5-$10
Honorable mention
TZA $15.25 2011 target $32
REDF $5.30 2011 target $10
AAPL puts- +2,000% :)
I want to say RAS as well, but CME real estate futures signal a stiff real estate price decline over the next 2 months, so I would rather stay away from that sector for the time being.
Jesse - with those triple inverse ETFs, even if we experience a down market the ETF can go down. Just see 2008 for an example.
ReplyDeleteGMXR looks interesting but its probably a 2nd half or 2012 story, no? I like David's idea of visiting the Nat Gas story in November (or in my opinion when Oil reaches 110).
Re: RAS > I honestly could see this hitting $6/share in 2011.
I just placed a sell stop limit order for most of my UNG (1700 shares) at $5.75/$5.70, in case today's storage report is going to be bad. Also, placed a sell limit order for a small part of my HNUZD (250 shares) at $6.50, in case there is a spike in NG in the morning.
ReplyDeleteTeam- Of course the inverse ETF's can (and most certainly will over time) decline in a sideways or slightly downward market. The double inverse etf's more than doubled in 2008. Of course, our job as traders is to sell when the going gets frothy. When investors start gloating about how their double/triple etf's are the best investment ever (similar to how traders are gloating right this minute about their ytd gains) that is precisely the time to sell. As is the case in the current market IMO.
ReplyDeleteAs for GMXR and natgas, most are expecting a natgas move later next year, sometime in '12, or never. That means that it might surprise EVERYBODY and start its move well before.
Re: Rare earth mania in full bloom, newSubmitted by Vadym Graifer (1676 comments) on Thu, 12/30/2010 - 09:40 #76790 (in reply to #76789)
ReplyDeleteLook at CHGS right now to know everything you need to know about this stage of mania.
Don't forget to look at it in a month again, to know the rest :)
CP- Time to dump GMO, IMO.
ReplyDeleteTook my lump on CMG...dumb move on that one, not waiting for a breakout above a resistance point. Sold my 2 x Calls at $12.8 that I bought at $15.5.
ReplyDeleteMMR off @ 17.68.
ReplyDeleteGEDU - My pick of the week.
ReplyDeleteRe: Rare earth mania in full bloom, newSubmitted by 2nd_ave (5107 comments) on Thu, 12/30/2010 - 10:17 #76793 (in reply to #76790)
ReplyDeleteVad- Too funny. I can see cell phone traffic lighting up Henan province. 5% investors, 95% extended 'family-' which is to say, no one in Henan is working right now.
CADC - My fav for 2011
ReplyDeleteFRO - Looks good here too.
ReplyDeleteGMO - Historical price vs moly would put it around $6.50 today, excluding recent permitting progress.
ReplyDeleteA reasonable 2011 target based solely on mineral value is $10...
V off @ 70.32
ReplyDeleteBAC off @ 13.38
CDII/XING/CNAM - Nice moves there, fellas!
ReplyDeleteUNG off @ 5.90.
ReplyDeleteOffing risk, Mark?
ReplyDeleteWell, I'm certainly out of margin now ;)
ReplyDeletePut call is .42 guys. 52 week low close was .54 a few days before the April collapse. 10 day pc is at 52 week low. As always, we'll see how it closes....
ReplyDeleteGMO: If CP is playing with the house's money and has hard stops, he should stick with the trend which is still intact. The price has big air under the MA's, is killer steep, and just broke out. A pullback should be expected.
ReplyDeleteNice knockout move on the chart, which is what they count on to shake you out if you're a recent acquirer. If you were in it from $3-4 and took out some profits, then the big money, as Livermore pointed out, is with sitting.
FF
MCOX - Keep an eye peeled on this one...
ReplyDelete2nd- Yep. It's been a great run into the end of the year. I've just had this feeling the last few days that things were getting a little silly. Now this whole rare earth craziness was enough to push me over the edge. I'm still VERY bullish for the bulk off 2011, but damn, who isn't? I'll wait in the dinner at the train station with you now.
ReplyDeleteSorry, big air ABOVE the MA's. More coffee....
ReplyDeleteFF
What He Said......
ReplyDeleteRe: Rare earth mania in full bloom, new
Submitted by Vadym Graifer (1677 comments) on Thu, 12/30/2010 - 10:45 #76797 (in reply to #76795)
"shamblin,
this kind of trades is different somewhat. They rarely develop in correspondence with traditional setup and rather obey what we call a momo. They are hectic (just look the charts of these stocks over last few days for a nice visual of that, LOL), risky but carry great profit potential - as long as you stay careful and keep some basic rules.
Do not buy breakout on momo stocks - those will shake you out 9 out of 10 (figuratively speaking, not that I run stats on that)
Instead, wait for sharp deep pullbacks and hunt for a pattern of ascending channel - once crowds catch that rhythm they tend to maintain it for a while. Buy the reversal off lower envelop, sell or partial out near upper one.
Keep position size reasonable and keep your stops as if your very life depended on it. When momo dies, you don't want to be caught waiting for your losing position to recover.
Be fluid, willing to enter a few times finding right one.
Observe them to get intuitive feeling of the way they move. There is a lot of "stock personality" involved in those moves.
We had quite a few nice rades in them over last few days."
Craig- You're referring to TODAY's knockout move?
ReplyDeleteGMO - Yes, unfortunately I extracted the original capital out a bit too soon. I'll let it stand on it's own from here with an eye on adding should a temporarily unpleasant surprise materialize.
ReplyDeleteS&P 1258 isn't bad news, I hope we can end the year above 1252 in preparation for the next push past 1290.
added TYP and ERY 23.77 and 22.54
ReplyDeleteCYD - This one's my interpretation of Craig's kind of chart. Now entering the coveted pullback.
ReplyDelete0.42, jesse? That's like having one foot ouside the diner, and spinning back in when you see someone waving the 0.42 around.
ReplyDeleteProbably dumb but I bought BYD Jan $9 Calls at $1.67 avg after seeing it break out above $10.45.
ReplyDeleteYes. IMO it's setting up as a buy when/if the trend resumes. If it were to pullback, but not to the previous range, then resume the trend and clear the knockout bar, it's an entry.
ReplyDeleteI trade exactly as Vad is describing. A little different terminology, but he describes it perfectly, including stops and basic rules.
If I had a large position I might sell a little into that nice breakout knowing it isn't likely sustainable and that it will pullback. The break was quite steep...but it could do what the last one did and simply establish a range and work it off sideways.
FF
BYD- I saw that same interview. I would have gotten in but didn't want to get deeper into margin. I bet the shorts were going, Oh, F@#$.
ReplyDeleteDamn near 100% cash here. Got to run.
UNG off for the moment at 5.82. Not sure how it would react if commodities tumble in the short term.
ReplyDeleteSold 13 of my 38 BYD calls at $1.00 that I bought yesterday at $0.65.
ReplyDeletegreat byd trade TOF! not a bad 1 day return:)
ReplyDeleteSold the remaining 25 of my BYD Jan $10 Calls at $0.95 that I bought yesterday. Now just holding the Jan $9 Calls and might hedge them.
ReplyDeleteSold my eBay at $28.14 that I bought at $28.3 average.
I did buy a few eBay $27 Jan Calls this morning at $2.11 that I'm still holding.
ReplyDeleteSorry...Feb Calls on eBay that is. I'm looking to reload my deep in the money puts on RIMM but am waiting for a break down below $57.7
ReplyDeleteEbay might work out, the chart looks to be rolling over.
ReplyDeleteDouble top/H&S and the MA's crossing down.
As of this moment, my port is up just 70% from where I began three years ago. Not the 100% I'd targeted by EOY but still not too bad IMO, considering I'm just a beginner having been faked out many times over by the game.
ReplyDeleteRe: 'Smart Money' newSubmitted by 2nd_ave (5109 comments) on Thu, 12/30/2010 - 12:21 #76820 (in reply to #76814)
ReplyDeleteVad- Are you able to provide an official definition of 'smart money?'
(a) Is it the guy who ends up with the most money at the end of each trade, as in 'smart play?'
(b) The experienced trader who makes the 'right' moves most of the time?
(c) The omniscient broker-dealer with access to order flow?
(d) The Anti-Crowd.
(e) A term used to describe an otherwise non-existent entity that represents the best possible outcome in any trade?
Re: 'Smart Money'
ReplyDeleteSubmitted by Vadym Graifer (1681 comments) on Thu, 12/30/2010 - 13:08 #76826 (in reply to #76820)
Out of choices you present, I'd say b).
a)"the guy who ends up with the most money at the end of each trade" is tempting but not exactly correct. Right play sometimes results in loss and visa versa.
c) "The omniscient broker-dealer with access to order flow" - this is just inside information, illegal and/or unethical, nothing to do with real trading based on understanding market laws and patterns.
d) "The Anti-Crowd" - somewhat, but still not very precisely - sometimes there is good time to be with crowd. There is an old saying about crowd being wrong on the both ends of the move but right in the middle of it.
e) "non-existent entity that represents the best possible outcome in any trade" - nice but still, non-existent :)
That leaves us with b) - The experienced trader who makes the 'right' moves most of the time. If I formulated it outside of your choices, I'd put it this way:
A trader who understands the underlying laws governing the markets, can discern the behavioral patterns of the market participants, knows how to read their footprints on the chart/tape and has ability to act on his knowledge in a disciplined fashion.
2nd: classic Landry trade is FTK.
ReplyDeleteenter 3.95, profit target for 1/2 $5.20, stop 3.35.
Today hit 5.18 took half off (don't quibble over .02!) Move stop up to 3.95 and sleep at night.
Made 30% on first half, up over 25% on remaining shares. I fully expect a knockout/retracement after todays move. If it keeps moving in my favor I'll slowly move stops up, but looser than previously.
FF
"As for GMXR and natgas, most are expecting a natgas move later next year, sometime in '12, or never. That means that it might surprise EVERYBODY and start its move well before."
ReplyDeleteJesse, unfortunately the moves in NG have to follow the storage numbers -- NG can't start going up to everyone's surprise if the storage level reaches and eclipses the 5-year max for that time of the year. Unfortunately, I think that this has a high chance of happening this winter/spring.
My sell stop order on UNG at $5.75/$5.70 did not get triggered today, and so I just canceled it. Instead, I just sold 1/2 of my HNUZD at $6.30.
Sold another 1/5 of my HNUZD (500 shares) at $6.45.
ReplyDeleteI see that after the crazy run up on Tuesday, $5.75 has been a support level for UNG. So I decided to reinstate my sell stop limit order for all my UNG at $5.74/$5.72.
ReplyDeleteI lowered the sell limit order for 10K shares of ECUXF in my small IRA account to $1.27 and they were sold in pieces today. Now, I placed a buy stop limit order for 1000 shares of TWM (1/2 of my IRA, which is fully in cash now) at $12.50/$12.60.
ReplyDeleteCADC off at 4.53.
ReplyDeleteI was just thinking about doing that with CADC, Mark... The alternative strategy is to what until Friday to sell it.
ReplyDeleteImbalances...
ReplyDeleteBUY- SHZ
SELL- AA/BAC/JPM/MS/CVX.
Man, that kinda say's it all doesn't it :)
David- The recent move HAS to be related to SHZ/CDII etc. Had to take the profits.
ReplyDeleteCADC: as an experiment, I'll see what happens if I try to be more like Jesse and let my winners run... At least until tomorrow. :))
ReplyDeleteCP, 70% gain in 3 most volatile years for the stock market in 3 decades is a great result! You have a strong long bias now in your thinking -- how were you investing until March 2009? Were you mostly short during that time period? Or were you just very careful with your capital and never invested more than a small fraction of it into any stocks until the turning point in March 2009?
ReplyDeleteThanks David, I honestly felt the economy was about to crash due to excessive debt and the clincher for me were new, large homes being sold with zero down crazy-cash-back credit and folks with mediocre employment driving around in new SUV's while enjoying themselves like I've never witnessed in my life, all on credit, from what I could see.
ReplyDeleteSo based on these observations, I dumped my real estate as quickly as I could and moved to cash. Well, being the curious sort, I guess I started dipping my toe into stocks (something I'd been considering for over a decade, never had the time) a bit too early, and gold as well, thinking gold was a safe-haven.
Nobody bothered to tell me gold would crater along with everything else, even when they knew it would! When it comes to money, I can't afford to converse with someone unwilling to share their knowledge.
As it turned out, as prices kept falling, I simply stopped legging in until prices leveled out, juggled around a bit here and there, increased leverage on existing positions (ie:transition from SSO to TNA), noticed equities were rising faster than gold, researched as best as I could to find excessively beaten down, lesser known stocks that hadn't already begun to rise from the ashes, bought those, and held my nose.
Yep, I got snookered out of oil when it was trading @ $10, slightly less than where I'd bought it.
I've got a long list of these:
Crude - Snookered! TCK - Snookered! WFMI - Snookered! Even several I'd bought that others around me hadn't mentioned b/c the market surely would crash again and the sky would fall, on and on... Snookered!
Anyway, I also began to notice there were voices in the crowd who just seemed to have a fairly good idea of which items were quite oversold, kept a cool head, and were consistently willing to share their thoughts in advance of the large moves, not always after the fact. The best things in life really are free, you know, the key is to keep digging until you've found them.
CADC - "Form 8-K for CHINA ADVANCED CONSTRUCTION MATERIALS GROUP, INC
ReplyDelete--------------------------------------------------------------------------------
30-Dec-2010
Changes in Registrant's Certifying Accountant
Item 4.01 Changes in Registrant's Certifying Accountant
Dismissal of Previous Independent Registered Public Accounting Firm"
http://biz.yahoo.com/e/101230/cadc8-k.html
CADC - That's good news, BTW... In case you were wondering.
ReplyDeleteSo, did I simply wet my pants today, taking profits across the board, before they went poof. I'm sure it probably seemed that way, and I apologize for the hit an run posts today, but I've been really busy. This was my thinking, based on the last few days of trading.
ReplyDeleteOverall- I was as long as I've ever been over the past few weeks, both in % terms and net $ terms. 3 of my positions accounted for about 70% of my port. BAC/MMR/V. I was about $60K into margin without really thinking about it before hand.
BAC +17.87%...It's clearly having a hard time getting above 13.50ish. 6 days without really doing much. OK, it might be fair to call this a bull flag and it will breakout higher soon. We'll see.
MMR + 21.65%... MOG scared me off this one. Well appraisals due soon and I don't want to have a huge bet on the table without any clue as to the results. XLE is also over extended and due for at least some type of correction.
V + 5.43%... The trade was simple. A bounce off a panic bottom. Worked great. Last 3 days it's been sliding down, along with my profits.
CADC + 17.77%...Like I said earlier to David, I'm guessing the last 3 days have been an reaction to the craziness in all small things made in China. This was more of a gut play really.
UNG + 3.42%... Today was the 4th week in a row with a draw at the high end of the estimates. It's really gone nowhere the whole time. I'll be more interested in the producers going forward.
So what's left? Not much. 20K shares of RAS in my IRA, 1K shares of WATG somewhere at the bottom of the ocean, and 5K shares of C that I just like for the long haul.
90% cash I'd guess, which for me is more loike 100%.
CB- If one was looking for a good entry into RBY, what would that be?
ReplyDeleteMakes sense. Perfect Fing sense. Natty + .001 right now. Figures :(
ReplyDelete