Today's close will mark the end of Q1 2014. Fund managers are incentivized to bid stocks
higher (as bonuses are based on quarterly performance).
(a) The BRIC trade has become too crowded for my tastes
(it didn't take long to attract momentum players!). I have already closed most positions. I have a few remaining call options on RSX
which will be closed at or near the open.
Longer term, I see the BRIC train headed much higher (following a short
dive into the next valley).
(b) US indexes are a concern. I still believe a major correction is
imminent, and that both the DJIA and SPX will end the year lower. The historically high profit margins seen in
2013 are unsustainable, IMO.
(c) Brokers will never recommend 'cash' as a
position. However, cash allows you to
open positions when buying opportunities arise.
I plan to hold a high cash position for most of Q2.
Yellen just pounded the shorts and sent them home screaming.
ReplyDeleteSo it's fed jawbone time. If she is talking then it's either 'we are tightening' or 'markets and employment may be weaker, we're not tightening'. So this must be the latter....(I don't know I don't look at the news anymore). But if it's 'sending the shorts running' then it's good for my metal and resource positions. Gotta love a manipulative fed....
DeleteWhatever she said worked, temporarily only perhaps.
DeleteCould be. It was good for a blip, but at some point you have to wonder who is wagging who (whom?). The charts look ugly and traders make plans and tend to stick with them, so she might cause a spike into a gatekeeper and then traders sell on the highs anyway.
DeleteBTW CP, look at energies and utilities. It looks like the defensive sectors are taking off, which might fit your comfort level.
DeleteTo comment on yesterday's trading methods thread......TOF and BB are right, you have to go with what feels right and works for you. Half of the battle is having confidence and conviction because a lot of positions will go against you and you have to have a plan. The other part for me is money management. Taking partial profits, giving positions room and letting them run is how I roll. It's really a hybrid of swing/long trading. To each his own, but you gotta be comfortable or you will cut and run and the worst time
ReplyDelete.
Once again the P's are masking a lot of weakness and rotation in the markets. The Q's are very close to a transitional bowtie down off of multi-year highs. The database is producing a few shorts, good luck!
PRAN - This one has crossed my screen several times lately, guess it was a bad omen!
ReplyDelete2nd - I actually think the R trade in the BRICs is going to last a while longer. I'm biased as I bought a 30% chunk into YNDX which is rocking today. I think it goes to $36/7 fairly quickly, barring a collapse in the market. I am also thinking it's too early to get back into TZA...still trying to decide on that.
ReplyDeleteGlad to hear about YNDX. I'm not outright bearish on RSX. I just think we see EM retrace in the near term.
DeleteThe T in BRIC ain't doin' half bad either.
DeleteYeah awesome move on BB's part. Turkey is going ballistic
DeleteI tend to close positions that go ballistic, of course.
DeleteRSI_EMA at 79 right now. It peaked at 84 to 87 the last 2 years
DeleteSNE looks hellbent on getting new 52 week highs. I'm pissed I didn't hop on that one...was too busy playing TZA which I guess worked out ok but at the time SNE was at $17 and a move to $23 is a 35% move.
ReplyDelete“This extraordinary commitment is still needed and will be for some time, and I believe that view is widely shared by my fellow policymakers at the Fed,” Yellen said.
ReplyDeleteThus, anyone who has money buys stocks, realizing that if they remain in cash Yellen will make sure they have no gains.
DeleteFederal Reserve Chairwoman Janet Yellen on Monday offered a full-throated defense of the central bank's easy money policies in a speech in Chicago . Most importantly, she argued that there is still substantial slack in the economy, holding down inflation and giving the Fed room to keep interest rates low.
DeleteHere are her five main arguments for slack (the portion in italics are direct quotes from her remarks):
1) PART-TIME WORKERS: One form of evidence for slack is found in other labor market data, beyond the unemployment rate or payrolls, some of which I have touched on already. For example, the seven million people who are working part time but would like a full-time job. This number is much larger than we would expect at 6.7% unemployment, based on past experience, and the existence of such a large pool of "partly unemployed" workers is a sign that labor conditions are worse than indicated by the unemployment rate.
2) JOB MARKET TURNOVER: Statistics on job turnover also point to considerable slack in the labor market. Although firms are now laying off fewer workers, they have been reluctant to increase the pace of hiring. Likewise, the number of people who voluntarily quit their jobs is noticeably below levels before the recession; that is an indicator that people are reluctant to risk leaving their jobs because they worry that it will be hard to find another. It is also a sign that firms may not be recruiting very aggressively to hire workers away from their competitors.
3) WAGES: The decline in unemployment has not helped raise wages for workers as in past recoveries. Workers in a slack market have little leverage to demand raises. Labor compensation has increased an average of only a little more than 2% per year since the recession, which is very low by historical standards. Wage growth for most workers was modest for a couple of decades before the recession due to globalization and other factors beyond the level of economic activity, and those forces are undoubtedly still relevant. But labor market slack has also surely been a factor in holding down compensation. The low rate of wage growth is, to me, another sign that the Fed's job is not yet done.
4) LONG-TERM UNEMPLOYED: (Another) form of evidence related to slack concerns the characteristics of the extraordinarily large share of the unemployed who have been out of work for six months or more. These workers find it exceptionally hard to find steady, regular work, and they appear to be at a severe competitive disadvantage when trying to find a job. The concern is that the long-term unemployed may remain on the sidelines, ultimately dropping out of the workforce. But the data suggest that the long-term unemployed look basically the same as other unemployed people in terms of their occupations, educational attainment, and other characteristics. And, although they find jobs with lower frequency than the short-term jobless do, the rate at which job seekers are finding jobs has only marginally improved for both groups. That is, we have not yet seen clear indications that the short-term unemployed are finding it increasingly easier to find work relative to the long-term unemployed. This fact gives me hope that a significant share of the long-term unemployed will ultimately benefit from a stronger labor market.
5) PARTICIPATION: A final piece of evidence of slack in the labor market has been the behavior of the participation rate--the proportion of working-age adults that hold or are seeking jobs. Participation falls in a slack job market when people who want a job give up trying to find one. When the recession began, 66% of the working-age population was part of the labor force. Participation dropped, as it normally does in a recession, but then kept dropping in the recovery. It now stands at 63%, the same level as in 1978, when a much smaller share of women were in the workforce. Lower participation could mean that the 6.7% unemployment rate is overstating the progress in the labor market.
Therefore, it is not yet wise to lay out shorts. Perhaps a re-test of the 1,200 level for the RUT will get me back in.
DeleteShe must've noticed the yield curve flattened following her last comment session. Good thing someone received her dialog before we did, so they could front run us.
DeleteYeah, that lasted what? About an hour before they started selling it?
DeleteAdded a little more YNDX at $30.4 and $30.57.
ReplyDeleteAside from today's market action, did any of you guys catch the IEX/HFT story last night on 60 mins? Really interesting stuff.
ReplyDeleteEither I watched or read about it, ST memory is failing me. Apparently the HFT trading firm that's going public and has never had a losing day uses IEX, from what I read (probably they use more than IEX from the way it sounded).
DeleteAnd the pump for TSLA on the show as well.
The IEX is anti-HFTing. They figured out how the HFT firms were front running and put them on a system with 60KM longer fiber optic cable which slows them down. All the big firms and retirement funds that were getting killed on fills by HFT firms joined (including GS) because IEX is an honest exchange. Imagine that.
DeleteYes, and the TSLA/Elon Musk pump.
http://www.reuters.com/article/2014/03/31/us-markets-hft-flashboys-idUSBREA2U03D20140331
DeleteING - Saw a news clip saying ING is contemplating dividend reinstatement.
ReplyDeleteARO - Let me know if you guys start hearing this one's going bankrupt, like the media did for JCP P/S is still a lofty 0.19
ReplyDeleteHoly shit. Thanks for pointing that one out. Will have to look further into that.
DeleteCash balance went down $170 Million in past 4 quarters. Yikes. I wonder why.
DeleteSomebody's throwing sacks of money out the back door into the dumpster, probably. Fire that guy and prob solved!
DeleteAnd silver sinks.... How the heck are they doing that, don't solar cells use silver or not?
ReplyDeleteFLWS - Out at $5.59, will try reloading around $5.42
ReplyDeleteCrap, it took off...
DeleteAGCO - Holy crap, I knew this one wouldn't revisit $52
ReplyDeleteRTH - Still hasn't made it back over $59.60
ReplyDeleteWell that was annoying. Sold the YNDX at $29.96 avg. Bought back into TZA at $15.535 avg. Daytrade of course.
ReplyDeleteThe dollar rallied hard overnight then crashed into this morning, exacerbated by Yellen's comments. Well it has since rallied back almost to breakeven and it still looks like it's heading higher. This strikes me as quite bearish in the short term for the markets, unless of course you think it's because of anticipated QE out of Europe. This is part of the reason I decided to try the TZA trade again. Also, RSI_EMA for hte hourly chart was 89 which is the highest it has gotten to over the past month, including the huge spike to all time highs after the Crimea stuff went down.
ReplyDeleteING is still a good stock, even though it has doubled in the last year. I think you see a lot of institutional money go into the stock over the next couple of years as the last billion of the debt is paid and the dividend resumes. They have a very strong core banking business in the Netherlands and Belgium and when they spin off the Euro insurance arm, it will likely also get a higher valuation.
ReplyDeleteLooking at TUR and EWZ, EEM, etc., they have had very strong moves off their bottoms, but they are still quite a bit lower than they were a year or three ago. I think a lot of the selling the last few months was based on sentiment and not fundamentals, so the holders who are left are probably not easy sellers. Because of this, stocks coming out a situation where everyone hates them don't give you an easy chance to get in, so I am reluctant to sell my TUR or BSBR as I feel pretty good they will be quite a bit higher in the not too far off future and it is hard to time how they get there.
ReplyDeleteI'm already up 14% on TUR, wish it was a whole position but it still helps a lot. Thanks and nice call BB! :)
DeleteExcellent. Good to hear
DeleteYou made 14% on a turkey?
DeleteGood add from CC earlier today - money management is also very important in addition to picking good stocks. I've known a lot of people who were doing well in the market who got into trouble because they did this poorly and got into things like being over-margined into high markets, over-concentrating their portfolio's, not knowing what they really owned (a big problem for mutual fund investors), etc.
ReplyDeleteMarch is NEVER a down month....
ReplyDeleteSORL out with earnings today and were alright, but the forecast was a bit weak (strong revenue, but flat earnings) and the stock is down 5$. FWD P/E will still be under 9, but thinking of selling this one. I'm really happy with how it has done since David talked about it (up 120%), but I'm starting to think it will never get full value recognition by the market because of the China connection.
ReplyDeleteSPX - 1873 is tough resistance.
ReplyDeleteInternet finally back up and running...and much faster! Make sure you all have the latest modems.
ReplyDeleteClosed BSBR @ 5.56. +14.75%. Petty vertical here.
ReplyDeleteAre all those shares in the last few bars yours again?
DeleteMark is Tweedy Browne
DeleteHe'll hang around as long as we will let him, but you don't have to call me darin', darlin', you never even call me Tweedy Browne!
DeleteHe never minded standin' in the rain.......
DeletePRAN is why I will never have a big position in a biotech stock.
ReplyDeleteI have an impression it was being heavily marketed recently, someone knew?
DeleteI've seen it on momo lists for a while.
DeleteIf I'd only bet red...
DeleteGreat looking chart with no fundies, maybe I'll stick with stogy post-it notes for a while longer.
DeleteSo I guess the FED waffles back and forth testing the market until finally the response is positive? Thus the market is setting monetary policy?
ReplyDeletehttp://www.marketwatch.com/story/can-short-term-gold-traders-start-buying-2014-03-31
ReplyDeleteMaybe it's still early to be long.
L.P.D.: LIBERTARIAN POLICE DEPARTMENT
ReplyDeletePOSTED BY TOM O'DONNELL
I was shooting heroin and reading “The Fountainhead” in the front seat of my privately owned police cruiser when a call came in. I put a quarter in the radio to activate it. It was the chief.
“Bad news, detective. We got a situation.”
“What? Is the mayor trying to ban trans fats again?”
“Worse. Somebody just stole 474 million dollars’ worth of bitcoins.”
The heroin needle practically fell out of my arm. “What kind of monster would do something like that? Bitcoins are the ultimate currency: virtual, anonymous, stateless. They represent true economic freedom, not subject to arbitrary manipulation by any government. Do we have any leads?”
“Not yet. But mark my words: we’re going to figure out who did this and we’re going to take them down… provided someone pays us a fair market rate to do so.”
“Easy, chief,” I said, “Any rate the market offers is, by definition, fair.”
He laughed. “That’s why you’re the best I got, Lisowski. Now you get out there and find those bitcoins.”
“Don’t worry,” I said. “I’m on it.”
I put a quarter in the siren. Ten minutes later, I was on the scene. It was a normal office building, strangled on all sides by public sidewalks. I hopped over them and went inside.
“Home Depot™ presents The Police!®” I said, flashing my badge and my gun and a small picture of Ron Paul. “Nobody move unless you want to!” They didn’t.
“Now, which one of you punks is going to pay me to investigate this crime?” No one spoke up.
“Come on,” I said. “Don’t you all understand that the protection of private property is the foundation of all personal liberty?”
It didn’t seem like they did.
“Seriously, guys. Without a strong economic motivator, I’m just going to stand here and not solve this case. Cash is fine, but I prefer being paid in gold bullion or autographed Penn Jillette posters.”
Nothing. These people were stonewalling me. It almost seemed like they didn’t care that a fortune in computer money invented to buy drugs was missing.
I figured I could wait them out. I lit several cigarettes indoors. A pregnant lady coughed, and I told her that secondhand smoke is a myth. Just then, a man in glasses made a break for it.
“Subway™ Eat Fresh and Freeze, Scumbag!®” I yelled.
Too late. He was already out the front door. I went after him.
“Stop right there!” I yelled as I ran. He was faster than me because I always try to avoid stepping on public sidewalks. Our country needs a private-sidewalk voucher system, but, thanks to the incestuous interplay between our corrupt federal government and the public-sidewalk lobby, it will never happen.
I was losing him. “Listen, I’ll pay you to stop!” I yelled. “What would you consider an appropriate price point for stopping? I’ll offer you a thirteenth of an ounce of gold and a gently worn ‘Bob Barr ‘08’ extra-large long-sleeved men’s T-shirt!”
He turned. In his hand was a revolver that the Constitution said he had every right to own. He fired at me and missed. I pulled my own gun, put a quarter in it, and fired back. The bullet lodged in a U.S.P.S. mailbox less than a foot from his head. I shot the mailbox again, on purpose.
“All right, all right!” the man yelled, throwing down his weapon. “I give up, cop! I confess: I took the bitcoins.”
“Why’d you do it?” I asked, as I slapped a pair of Oikos™ Greek Yogurt Presents Handcuffs® on the guy.
“Because I was afraid.”
“Afraid?”
“Afraid of an economic future free from the pernicious meddling of central bankers,” he said. “I’m a central banker.”
I wanted to coldcock the guy. Years ago, a central banker killed my partner. Instead, I shook my head.
“Let this be a message to all your central-banker friends out on the street,” I said. “No matter how many bitcoins you steal, you’ll never take away the dream of an open society based on the principles of personal and economic freedom.”
He nodded, because he knew I was right. Then he swiped his credit card to pay me for arresting him.
Tom O’Donnell’s children’s novel, “Space Rocks!” is out now.
Oh, I love the Police; "Don't stand so, don't stand so, don't stand so close to me....."
DeleteThis is great and all, but I want to see the Q's and the rusty do the same....
ReplyDeletehttp://goldstocksforex.com/2014/03/31/sp-500-continues-to-rally/
Installed Nest thermostats and smoke detectors today. Pretty freaking cool but um a builder geek.
ReplyDeleteSmart concept - read the review on CNET and it says most people don't program their programmable thermostats - hard to believe.
DeleteBought a new furnace this winter and having quite a few problems with my thermostat - I set it to 19 Celcius at night and it goes to 18.5. Maybe I'll just send it back and get one of these.
They cost more but the cool factor is pretty high. You hang out with South Beach crowd. Go for it!
DeleteA thermostat is supposed to cut on at some temp (usually adjustable if digital) below the set point and cut off at some temp above the set point, you must have some hysteresis or else the furnace would cycle constantly (short cycle) and the cutting on and off will drive you nuts.
DeleteTypical setting for hysteresis is 1*F I think, mine is set for 1.5*F I think, and I do use the programming but with a heat pump you have to be careful not to exceed a 3 degree window or you'll get into the backup resistance heaters. This heat pump druns but doesn't make much heat below 20*F so below that it's resistance heat and time to light the wood stove if you want to stay warm or burn money.
druns? I dunno. But every thermostat must have hysteresis unless it's a variable power system in an industrial type of furnace that requires precise thermal control, not going to find that design in a space heater.
DeleteI think we close red today.
ReplyDeleteApril Fools Day?
DeleteTUR - Out @ $49.66, with a 16% gain
ReplyDeleteChicken. I mean, turkey.
DeleteTurkey flying like an eagle! :)
DeleteBALT - Out @ $6.41 for a 20% gain on the last half
ReplyDeleteWhen does the news media flip back to doom and gloom?
RTH is $59.75, wow, they pushed it back into the happy zone on less than 3k shares......
ReplyDeleteFLWS - A nine cent lift, on just 20k shares
ReplyDeleteBSBR - Tweedy, give us some mercy!
ReplyDeleteFNMA - I hear Ackman is still loading the boat on this one?
ReplyDeleteN - I dunno guys, this one is lifting (FLWS too, for now).
ReplyDeleteARO - I'm watching this one as well.
FLWS seems cheap, I foolishly sold mine yesterday in a moment of weakness.
"U.S. Republican budget proposes deep cuts to social programs"
ReplyDeleteHopefully they get their tax cuts back too, pass the Norquist bill! (sarc)
http://www.traderplanet.com/journal/issue/4/page/57/
ReplyDelete2nd - this is right up your alley.
GEVO - Rhetorical question: Does this chart look anything like PEIX's chart at the knockout? GEVO has switched over to ethanol, wonder if they will be taking delivery of a trainload of free sugar as well?
ReplyDeleteKind of yeah. Positive divergences on the chart. What do these guys do?
DeleteThen again, same could be said for NIHD and JRCC.
Let's ferment and put the real sugar in our fuel tanks, we'll sweeten our diet sodas using the chemically derived pseudo-sugar to complement fast food from the drive through.
DeleteThis guy is a kind of legend famous for creating a new type of plastic that made plastics mfgr's tons of money, and now he's got a new process to manufacture isobutanol but it's not catching on yet. So he's switching over to ethanol I suppose to start making money and placing the intended process on the back burner (isubutanol has been tested by military and suceeded but approving anything is a lengthy process)
DeleteI guess if he gets the same or similar deal PEIX has concerning feedstock, he can churn out some cash.
Looks like $1.23 is today's price to beat.
DeleteJRCC - Honestly, I have a warm fuzzy feeling for coal.
DeleteWow great post I came across:
ReplyDelete"Yeah Right, Management has insight at the bottom, or how to leave $6Bn on the table http://stks.co/p0AUX $PCLN"
"The site you are trying to visit may be unsafe!"
DeleteWhen was the last time we had a 3% gap down for the S&P? Been a while.
ReplyDeleteThere's still a gap from $142 SPY that hasn't been filled. I mean, just sayin'
DeleteI dunno, but I sure have an itch to load up on TZA on any pops higher. This market is pizzing me off and feels tired..
DeleteI'm still holding an underwater position at $15.53 so I'm clearly biased! I see things that look like ok trading opps but I would like to see these sell signals on the weekly charts clear up first.
DeleteMark,
ReplyDeletemy daughters always tell me "fashion before function". Guess that applies to thermostats as well...
I like the idea of internet enabled appliances, adjusting the thermostat isn't something I obsess over though. Might be cool to close the garage door I left open, check if anyone's lurking in the house, or turn on/adjust the hot tub via internet. My car should alert me if someone has broken into my vehicle.
DeleteI might go for a programmable or instant water heater.
The best thing about Mark's is you don't have to program it. It programs itself based on how you adjust the thermostat over time. Plus, it has a sensor to know when people are gone and adjusts for that as well. Pretty slick idea.
DeleteCan it also control the humidifier? I had a tough time finding one that does that.
DeleteI don't know. Mark probably would.
DeleteSo, my furnace guy called me back and is going to give me a free upgrade to a Honeywell Prestige Thermostat - seems like a small computer really:
http://yourhome.honeywell.com/home/Products/Thermostats/7-Day-Programmable/Prestige+HD+7-Day+Programmable+Comfort+System.htm
I actually was using the humidification control feature to control the A/C, the idea was to have the A/C cut on if the humidity exceeded a set point. I think it was working, but didn't really test it much, might still be programmed that way, I've forgotten. Anyway, I can tolerate about 80*F in summer and that's about where it comes on I think.
DeleteNow I remember I think, I stopped using the humidity feature or maybe I adjusted it to way up scale b/c in order to reach the humidity levels I was playing with the indoor temp was ridiculously cold. It's been some time since I was fooling with it so it's vague.
DeleteI see the Honeywell displays outdoor conditions, that would be a good feature if the feed can be sent through your smartphone, I dunno if that would be any benefit though as you probably already have outdoor weather available on your smartphone.
DeleteA really smart thermostat might be able to rate your house's energy efficiency and help you fine tune insulation, find thermal leaks, etc.??
"Fashion before function".....but what about Apple? :>)
DeleteMET added to BACML's US#1 list. Bodes well for MET, but the applies to the overall life industry as well.
ReplyDeleteStill seems like one of the best way to play rising rates, plus you have the safety of being undervalued to the market and their traditional valuations.
CARB was on the #1 list as well, I think they finally took it off so it's probably a buy.
DeleteFeels like run up trap into close and fleece the sheep first thing tomorrow..
ReplyDeleteURG - Really strong today for some reason, maybe nuclear will displace the remainder of coal? Somebody better get some reactors on the drawing board if that's ever gonna happen.
ReplyDeleteGood chart if you are thinking about investing in gold for the long term comparing to other commodity prices. Seems that either gold should come dwon further or other commodities show go up to get in long term sync ratios:
ReplyDeletehttp://2.bp.blogspot.com/-915xaH-LMn0/Uzm6Ca-veKI/AAAAAAAAQYg/gc5k8fcFus8/s3200/Gold+vs+CRB+RIND.jpg
I like to think that's the correct perspective, recent market action is throwing me off track.
DeleteBlackhawk: Road show investor call: 2014 outlook maintained
ReplyDelete6 minutes ago
On today's road show investor call, management provided an overview of the business and a financial update. For 1Q, it expects adjusted EPS of $0.04-0.06 (+33-100% growth). This brackets consensus. We maintain our Neutral rating and $25 target. This is based on 17.6x CY15E EPS, a slight discount to peers.
ARMH - taking off
ReplyDeleteLooks like NVDA was following, might still if I'm not mistaken NVDA's new device(s) are ARMH architecture? This links in with TSM's foundry, I think.
DeleteIt would be interesting to know what GM/Delco are working on, crash avoidance and if ARMH/NVDA are part of that too.
DeleteCleared out my TZA at $15.21. Too bullish for me to stick with this.
ReplyDeleteLong FTEK at $5.18
ReplyDeleteLong YNDX again $31.3. Should have stuck with that one.
ReplyDeleteLong 5K NEST @ 6.66
ReplyDeleteI bought LNKD at $186.3. I've been debating this one for a while. I think its a good entry point on basically a monopoly. I don't think it will ever be cheap because of their monopoly status.
ReplyDeleteAt the very least it's probably due for a bounce having pulled back 28% since September and being right around the prior highs from last spring.
DeleteObviously, in contrast to what I heard a couple days ago, stocks aren't overpriced today....
ReplyDeleteThey're cheap!
DeleteI was talking with a few friends that are in the recruiting business 2 years ago about LNKD when it was at $80 and I said I thought it was a really good buy. I remember the conversation clearly because they said "LinkedIn is a monopoly. They have us recruiters by the balls and they know it." That conversation stuck with me and since then I've been watching for a good entry in the stock. Valuation is a bit ridiculous but I don't think it will ever be cheap because it is a monopoly. I doubt I will be able to hold it for long term given this valuation but relatively speaking, at a market cap 1/8 of FB and with a business model that I think is far superior and sustainable, I like it for at least a trade relative to others in its space.
ReplyDeleteI tried buying ENPH today but couldn't get much. I bought a few thousand shares at $7.8
ReplyDeleteThe Fly was right. The market indeed does not go down in March or April...
ReplyDeletehttp://ibankcoin.com/flyblog/2014/04/01/you-would-be-wise-not-to-bet-against-me/
I stand before you guys humbled...yet up 10% thanks to betting the market would fall in March.
I also fully expect the market to gap down 3% tomorrow just because it hasn't done it since August 2011.
DeleteI failed to close my IWM puts yesterday when IWM rose above Friday's highs, and I paid for that today. Always follow the plan...
ReplyDeleteI do have an excuse, though -- I was out of the house yesterday, driving to SF with my family. Another excuse: the reason for opening IWM puts was to hedge myself against losses in ORCL (I have a decent amount of options vesting on June 1), and ORCL broke to a new 10-year high yesterday (with another follow up today). So I am not too upset about IWM going up, as long as it takes ORCL up with it. :) Also, my crappy stocks (SCON, ALTI) went up over the past 2 days, which is nice too...
I decided to place a sell limit order at $4.93 for the 500 shares of ALTI that I picked up on the pullback at $4.23, just to get some trading going...
Taking a look at the SOX (Philly Semis Index) it makes me wonder if maybe there's a rebound like that in store for the Baltic Dry Index over time. There was a massive bubble in 2000 that brought the sox up to ridiculous highs:
ReplyDeletehttp://finance.yahoo.com/echarts?s=^SOX
Then the crash brought it down 87% peak to trough. The BDI was even worse: 95% peak to trough. It's still only 100% off the bottom or 90% from the top. Clearly NM, at 1/2 the price of its highs, has baked in a rebound. Might be time to dust off the projections again for BALT just in the event that my assumptions about coal and China are wrong...which given how the market likes to humble all of us is quite likely.
The SOX is just now clearing above overhead resistance formed after the crash, around 5500. There's probably a good deal of upside left. The BDI ran up to 4,500 or so after the crash. I suspect at some point over the next few years there's a decent chance we see a move north of that, assuming all bad things don't come to pass. That leaves us with an market where BALT is earning $1+ EPS quarterly. If peak multiples are 8X earnings, then theoretically BALT could go to $30 to $35, paying a $3 a share dividend. Just the chance of that happening should probably warrant at least a small position, no?
Maybe, but the BDI isn't a trading vehicle with traders trying to outsmart and fool each other into making mistakes, the BDI represents the spot rate you must pay per day to rent a ship? Now maybe if we were to say a trader was to buy shit-tons of some commodity and needed a place to store it so he rents a ship for the purpose, then maybe, indirectly speaking?
DeleteYes but the BDI is determined by humans who have emotions and remember prices they paid in the past
DeleteWhat does a ship rent for, and what's the rental period? If I'm buying megatons of a commodity, do I really care if it costs me another $5k this month to get it delivered?
DeleteIt really varies greatly regarding the rates...some customers lock in multi year contracts, some lock in shorter term contracts where every day's rates are based on the spot rate plus a vig. The companies locking in these rates look closely at the rates as they are baked into their profitability. The rates aren't a huge component of the total cost but it does matter some. Really the key driver is the sentiment of the shippers > if they are buying up ships because they believe the future looks rosy but the demand is weaker than expected, the glut of ships will drive prices down.
DeleteISRG - Have I mentioned the local hospital here is big time into and famous for robotic brain surgery?
ReplyDeleteIf you connect the two previous major lows for SCON (in November and February), then the upward sloping line will EXACTLY pass through the low it made yesterday. The probability of this happening if the stock movement were random is 0.
ReplyDeleteI think the chance of getting a bounce off this line is pretty good. So I have just placed sell limit orders for 1K shares at $3.2 and $3.4, so as to "divest" myself of the 2K shares I picked up last week at $2.8.
DeleteI like observations like that, and would think the price will pull back to make people the support has failed, just before it takes off again.
DeleteBut I honestly don't see large scale promise for superconductors, yes perhaps in some special circumstances where it's possible to cryogenically cool a magnetic winding on a locomotive or something but how does one cool a 100 mile length of power cable stretching from Austin to Waco? Why do they have such aspirations for making long lengths of wire, why do they need to spend tons of capital to do that and why can't they do it with existing equipment?
DeleteI discovered ISRG by talking with the staff at the local hospital, asked them what was the best thing that's come along since sliced bread and they told me if anything, it was De Vinchi. I've seen and heard of many stories of people from neighboring states being flown in at all odd hours for surgery following their strokes b/c their hospital couldn't do anything for them. This is big, real stuff going on right now as we speak lives are being saved in real time.
I thought about buying ISRG last fall when it was in the $380's, but didn't pull the trigger due to reading too much bad stuff on the stock. Back to almost $500 today. There are stocks like that that have almost no competition that should be easy buys on pullbcaks. DIS is the other one I let myself be talked out of in when it was under $30 a couple of years ago and now it is $80. It is another of those types of stocks that should be bought on pullbacks.
DeleteCara actually used to have that interesting strategy (before he went deep into the PM's) of identifying really good companies and waiting for their stock to fall (RSI <30 or something like that). That would probably be a good strategy in the current market.
Yeah, I wanted to as well and the same thing, negative articles came out at the bottom, thanks again to SA!
Deletehttp://papers.ssrn.com/sol3/papers.cfm?abstract_id=2417974
ReplyDeleteGood read re ATACX's rotation strategy.
MKND - Now that price action really sucks, doesn't it?
ReplyDeleteMNKD - Imeant. Notice insiders and tutes loaded up recently. Short float covered tonight?
DeleteTUR - This ETF moves up and the doom and gloom immediately yields to "bullish on the fragile five", LOL, same thing happened to IDX
ReplyDeleteBb - i think the same could be said for lnkd as isrg. There's nothing that can compete with lnkd now that they have hundreds of millions of people that rely on it and are fully integrated with it and recruiters have to use it to access the candidates available out there. It's basically the widest moat out there along with goog in the Internet world
ReplyDeleteAnother one in the same area as ISRG is HNSN. I believe ISRG did a license deal and also bought stock in HNSN. That's part of the reason I traded HNSN and am considering buying it again.
ReplyDeleteRobot is long from 1877
ReplyDeleteBaltic Dry Index (BDI) -43 1273
ReplyDeleteI'm thinking TAZ or ARO, unless something else comes along...
ReplyDeleteISRG - "Intuitive Surgical, Inc: New system is here; more on the way- Raising PO to $550"
ReplyDeleteI kinda figure they had to run prices up so IRA money is forced to buy from "them".
ReplyDeleteAnyone buying RSX here?
ReplyDeleteAlright I picked up a little RSX at $23.84.
DeleteGoldbugs can't catch a break:
ReplyDeletehttp://www.marketwatch.com/story/are-the-goldbugs-finally-crying-uncle-2014-04-02
"Of course, sentiment is not the only thing that makes the gold market run. So gold could very well defy the contrarians by mounting a rally from current levels.
DeleteBut if the contrarians are right, gold is headed lower before it heads much higher."
How does anyone make money following this guy? He needs anti-psychotics.
I probably need anti-psychotics as well, beware of unmedicated ME!
DeleteNot that GDX gives a shit. It's up +3%.
DeleteThe dollar is rallying a bit today. I think tomorrow could be a big day for the dollar if the ECB announces some form of QE
DeleteWonder what euro QE might do to euro banks holding that debt? I think you may be right ECB is moving that way.
DeleteNUGT was up 9%. Most miners were up over 5%. Pulling back some now after amateur half hour and some dollar strength, but 9% would be a good day in anyone's book. UUP is still in a downtrend with bowtie, rallied, forming a box. It sure could reverse, or more likely, be talked up by the Fed without doing much in reality. But, if you got in in Nov/Dec then you already captured some profits and are still on the house's dime.
DeleteI wouldn't expect the FED to talk UP the dollar?
DeleteActually, both up and down. When Yellen was confirmed the pm's formed the bottom and rallied. Then Russia did their thing and the dollar strengthened and then Yellen made another speech about tightening, which is dollar positive.
DeleteThe trouble for the Fed is near a top it's hard to believe she will stick with it if the selling continues. Damned if you do, damned if you don't.
FAST - This is another one I'd like to get into on a scary day, which is more likely today than a few days ago..
ReplyDeleteHave PM miners bottomed?
FLWS - I intend on buying a nice bouquet if this one comes back to me.
ReplyDeleteRenting TZA for a trade @ 15.02.
ReplyDeleteAlso HDGE @ 12.60.
DeleteARO - Taking off, seems like.
ReplyDeleteACI quietly up 25%
ReplyDeleteHard for me to believe coal really is dead.
DeleteYeah its probably media driven but the US wants none of it. That drives sentiment which as we all know is huge in stocks. Maybe ACI goes to $7 but it probably doesn't see $30 again until Obama is out of the office.
DeletePutin is far from done throwing his weight around, IMO.
ReplyDeleteI think that's over but I don't know anything about politics or Putin.
DeleteTZA - Stink bid at $14.20 just in case, it's nice out today and I want to enjoy some of it. This way I can still move up the bid once/if my meds kick in and I figure the IRA money spigot will keep prices high a few days anyway so maybe even create new high(s), all purely by coincidence, of course, until the next vague article published by some teenager on SA explaining how overpriced stocks are.
ReplyDeleteThey're buying RSX up off that gap down.
ReplyDeleteCoal's dead, dead, dead.
ReplyDeleteI would stay away. Going to be a long time for supply to adjust to the new demand dynamics.
DeleteMy concern is what impact this has on the dry bulk space. I still think this is a negative for them if China is really cracking down on pollution.
DeleteWPRT > Remember this one? Ouch.
ReplyDeleteNever did get this one. Has been losing money for years, and years, and years.
DeleteSo has LNG and look where that thing is.
DeleteLQDT- Anyone follow this?
ReplyDeleteI used to follow it. They have a government online auction service right?
DeleteFriggin ENPH. Figures that the only one I couldn't get a sizeable position in yesterday is up huge. That sucker looks good.
ReplyDeleteAdded a little YNDX on the dip down to $30.95 and again at $31.03.
ReplyDeleteENPH - Another f'in 6%, damn....
ReplyDeleteI'm holding my massive position for $30. Should be enough shares to get me a pimped out scooter.
Deleteor half way there to a NEST smoke detector.
Delete"a pimped out scooter." LOLROFL!! :)
DeleteJust buy more, solar is on a roll at least as long as everyone thinks it will displace coal, and it can run LED bulbs so switch to natty and light up with LED's
Or, maybe buy natty, b/c if we're not gonna burn coal we'll be burning shit-tons of natty till it runs out. The only replacement for fossil fuels is nuclear.
Obama doesn't have that much more time in office, the market is forward looking? Okay, coal is dead but SOMETHING has to replace 40% of our electricity? It's an unimaginable amount of energy being consumed.
ReplyDeleteEven Germany is telling the US to F'off when it comes to fossil fuels, and they've switched from nuclear to coal just like Japan has been doing, they still have to buy electricity from France.
Solar is fine for california, you can probably heat your home and water using natty and switch over to LED bulbs, your refrigerator will probably be the largest power consumer in your house and a full array of panels on the roof will probably run that.
During winter here, the outdoor temps run on average around 32*F, my indoor temp is 70*F, nearly a 40*F differential and nights are a 50*F differential on a good day, more than double that of a California home I bet, for longer periods (winter jackets here 6mo of year). There's no way a solar panel on the roof can make enough power to warm my electric home, what's the replacement for coal?
Watch, as electricity prices go Enron.
Deletedude - remember those cloning stocks? dead in the water the entire time bush was in office and the minute obama looked likely to get elected they took off. can't remember them but i just remember seeing some really good moves in them.
DeletePassive solar and solar mass works quite well even in cold temps and clouds. That's basically how the water heaters work.
DeleteGermany: About 40% from renewables so far. Not too bad. Enough that on peak days it lowers the price of electricity.
http://cleantechnica.com/2013/10/15/renewable-solar-wind-energy-produced-much-60-germanys-electricity-october-3rd/
We could do way better as we have better weather for it.
I used to work for a contractor locally that moved to Seattle.
DeleteShe now builds ZERO energy homes. Who wouldn't want that investment for life?
Yeah, you're right, I do remember that.
DeleteWPRT - Very tempting. Maybe this one is crashing b/c there ain't enough natty to go around(it's being burned to replace coal, one HELL of a lot of natty, think about coal and the 200 car trainloads one furnace burns every day) thus natty can't become a transportation fuel? Energy density is the key metric, natty appears less dense than coal to me, an accurate measurement must compensate for inert carbon content. Dirty, messy nasty stuff full of heavy metals, coal is, we really should find something to replace it or maybe at least recover the metals from the.coal ash and recycle the radioneucleides to nuclear fuel.
So maybe buy stock in a company that recycles coal ash, in preparation for the soon to be announced toxic coal ash dump site superfund cleanup?
"I used to work for a contractor locally that moved to Seattle.
DeleteShe now builds ZERO energy homes. Who wouldn't want that investment for life?"
So does anyone actually live in them, are they underground? How many watts electricity per square ft of roof? My TV set consumes about 400 watts when it's on, it's a power hog.
Coal usage will continue, but decrease as alternative sources take over. Supposedly there is a couple hundred years of accesible nat gas available . Its cheap and clean, so why would coal usage increase? And given that the coal mines have all been built, you get into a marginal cost game where they keep running as long as they can cover their costs, so until supply meaningfully falls. which typically takes years commodities (look at metals in the 80's and 90's), prices will be fighting an uphill battle.
DeleteInvesting in oil is much safer. 90% of oil is burned in cars and millions of cars are added to the road every year and, even with Tesla, etc., we are probably very far away from a reasonable substitute. So demand is solid and growing and there are no substitutes.
DeleteCC - You only present one side of the equation, the one you prefer, always with no numbers or detail to back it up. That makes it sound like a fairy tale. Notice Mark also has no figures to back his shit up either.
DeleteSo you're saying this plant isn't replacing lost capacity from shuttering nuclear? Maybe since we're going to use horse and buggies, we'll also burn candles?
http://insideclimatenews.org/news/20130724/why-germanys-greenest-city-building-coal-fired-power-plant
"why would coal usage increase?"
DeleteThat's a good question. Also, if there's plenty of natty to burn, the price of electricity should not trend higher. Before this past winter, there was talk of dismantling coal plants, those ideas are now in question since natty supplies failed to keep up.
One reason coal usage might increase is b/c half of the world's population want to live the western lifestyle?
I did a hell of a lot of research on renewables when a so-called biomass plant was proposed in my county, so I looked a lot at some of the technologies that would work here (pump-up hydro for example) and it turns out Germany, being a rather large industrial country has a lot of pump-up hydro, which for the uninitiated, is using wind and solar to pump water into a reservoir, then using the water for hydro, then pumping it back again, over and over. This is similar to the reservoir systems in So. Cal. that do the same during peak/off-peak hours. Germany actually has more wind power than it can currently use on some regions of the country (much like we do at off-peak times here in Washington) but it lacks the transmission capacity to move all that power at the times they need it in industrial centers like Hamburg. This may explain the building of the coal plant. However, one coal plant does not make an industry, it makes one plant.
DeleteThe story you cited says pretty much the same thing.
"The speed with which renewables have taken hold has posed a challenge to utilities that rely on fossil fuels, because federal laws require the grid to use all the available renewable energy before turning to coal or other fossil fuels.
As a result of the changing economic playing field, more than two dozen proposed coal power plants that would have generated almost 25 gigawatts have been mothballed, said Rainer Baake, director of Agora Energiewende, a nonprofit think tank focused on Germany's energy policies. Utilities that didn't scrap their plans may be experiencing buyer’s remorse."
On the other side is the current fight in the Hunter Valley of Australia between the residents and Rio Tinto seeking to expand their mines. I think that would be a China play, but that depends on if you can believe whatever comes out of China, unless you are just looking at the massive amounts of pollution.
I have a number of friends that are in this industry (clean energy). My contractor friend and my best friend Eli who is a solar engineer, so I do get some good information.
Full disclosure: I have a rather sizable position in uranium based on technical charts. I repeat: I am NOT a fundamental trader, so you are not likely my audience nor am I intending to have one.
F*ck sorry I meant to post that I sold my position in LNKD, I swear. Sold at $187.2. I had a feeling I could get in at a lower price. It does seem that they're taking down the momentum stocks still and despite the 7 month selloff in LNKD perhaps I can get a better entry. Not sure yet. I really like the stock but with a high priced stock it pays to get a good entry point and I don't quite have a comfort for where LNKD's bottom is.
ReplyDeleteI am still holding my underwater position in YNDX at avg of $31.2 but given that it's a combo of emerging markets and momo I think there's a chance it rebounds.
I'm also still holding a decent size position in FTEK at $5.18/9 which I really like because of its pollution control angle and the valuation is actually reasonable. Their overseas revenues are growing rapidly at 50%+ while their domestic revenues are weak. I was waiting on a gap fill from the November gap up and that happened. I just wanted to see how it would trade after the gap fill and it looks decent.
Still holding small positions in ENPH ($7.8) and UUP ($21.46). Also still a good chunk of cash. I am thinking tomorrow and Friday will be quite volatile. Part of me wants to short the downtrend in IWM from its highs which targets an entry around 1,200 but the market has almost negated the technical sell signal I was watching on the weekly charts so my conviction on that trade would be lower. I think the dollar could spike with the ECB meeting tomorrow which could be trouble for the market in the very short term.
Also sold my small position in RSX at $23.99 that I bought this morning at $23.84.
DeleteGood news concerning China's switch to clean energy:
ReplyDeletehttp://insideclimatenews.org/news/20140213/chinas-plan-clean-air-cities-will-doom-climate-scientists-say
Interesting...the question is which company aids in doing the coal to synthetic fuel conversion?
Delete