Thursday, April 7, 2016
4/7/16 Easy
How hard is it to be a bull right now?
I first heard this Lionel Ritchie composition while visiting an older cousin in NYC around 1978. I opened up his turntable one morning and slipped out the latest Commodores album. For some reason I decided to play the last track on Side Two. The piano intro hooked me immediately, and I replayed the same track at least a dozen times (back then you had to walk to the turntable and place the needle on a revolving vinyl LP).
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Futures were down last night, but are up .5% this morning.
ReplyDeleteMaybe the market just needed a good night sleep - haha
Over the last 4 days I've managed a slight gain, so Im happy.
DeleteSEDG is being a poopy pants today.
ReplyDeleteAtta Boy...
Deletehttps://www.youtube.com/watch?v=zInM4k9VERU&nohtml5=False
ReplyDeleteMost global ETFs (exchange traded funds) closed Thursday at the day's lows. This morning, most have gapped up above Thursday's highs! Traders may as well try and catch the wind. Oil +5.42%. DJIA +122 points. EEM (emerging markets), RSX (Russia), and FXI (China 'H' Shares) all +2%. EWZ (Brazil) +4.85%.
Biib $272.86
ReplyDeleteST?
DeleteSold tna and picked up some spxs. Something doesn't feel right about today
DeleteSold spxs.
DeleteSame feeling here for a week so I'm just ignoring it.
DeleteMark - I've been flipping biib for the past few days. I like it longer term as well tho
DeleteLong bac at 13.09
ReplyDeleteTook longs off
ReplyDeleteThese euro banks are set up. Long db and cs.
ReplyDeleteI might be out on the street by the end of the day. My thinking is these guys have made essentially double bottoms. Also you have a potential bank recapitalization plan in place over the weekend.
So what can we say about commodities over the past month? MOS/POT have pulled back A LOT. USO did have a pullback, but it has already recovered more than half of it. I have a feeling that MOS/POT will follow. So I just bought some in-the-money Jan 2017 calls on MOS.
ReplyDeleteThe situation with precious metals is quite interesting. After having an amazing Jan/Feb run, they were supposed to pull back in line with oil and other commodities, but they didn't. Today, GDXJ/GDX broke out to new highs, while GLD is not there yet. I have a feeling that we are in the bull phase where stocks are leading the metal, and so GLD will follow. If so, then SLV should follow as well. It has lagged the initial advance, but I read somewhere that SLV does that sometimes, and then stages a major rally and overtakes GLD. So I am still keeping USLV as my largest position right now, and I am in no rush to sell the shares I purchased on April 1 (at $11.94). I just placed a sell limit order for them at $14, the old highs.
ReplyDeletePicked up MTCH at $10.6. This is now trading at 13.9x CY EPS and 11.4x Forward estimates and revenues are growing 20%+. Seems way too oversold here.
ReplyDeleteTook the Euro bank stocks off. Not liking this trading action at all
ReplyDeleteEasy trade on the chart though...
DeleteI know man. I almost put it back on was debating for an hour
DeleteI have to wait and see if yesterday's announcement actually sticks, it really shouldn't in all honesty. I have a good idea in my mind of how this SHOULD go in all honesty but we've been subjected to so much dishonesty for so long the lines are blurred.
DeleteSRS - Not looking half bad on this dip?
ReplyDeleteCP - are you advocating shorting? We have all seen your criticisms of us making bad calls from time to time so how about time for you to make your own calls and take responsibility for your own mistakes? No one is going to be right all of the time. To think that is naive. It's how we handle our mistakes that's more important than the act of making mistakes.
ReplyDeleteI was asking a question, notice the punctuation. I see you guys habitually making mistakes seems like you're doing it on purpose.
DeleteOh, and you could give me some credit for suggesting to short SPX 2100 but hell no, right? You'd rather part someone on the back for getting long YINN at $25, you guys pretty much are dishonest a-holes seems to me.
DeleteOn 2nd thought don't want to make you think I desire your approval, wow, far from it.
DeleteHow about some honest appraisals though (of market, not me), some comprehensive examination of facts should be a consistent habit.
DeleteTake NMM for instance, their major customer is in debt 7x market cap. So where was the comprehensive examination and consideration, or even DD?
You guys are either working for some sales team or blind, I just curious to know which is the case?
IOW, It looks like maybe you're not just talking shit, you're peddling it.
DeleteI can only speak for myself but I view the market as a lifelong learning process. Every site I visit including this one I visit to absorb information, share ideas, research some of the things people are talking about, and use to increase my knowledge of the market, which is constantly evolving. Part of the process of investing is getting my ass handed to me from time to time and learning from my own mistakes. But no matter what I own my own mistakes and I respect the people that are sharing info with me, right or wrong (again, I've been around the market long enough to know everyone is wrong from time to time). Best of luck to you.
DeleteMIFI - Something's going on with this one but I'm sure nobody here will have an interest. I'm only posting it due to my extensive and continuing record of assists, it's a habitual thing.
ReplyDeleteRemember Boots and Coots, that was one of the first.
CADC - Oh no, this was the Chinese kiss of death I had no idea of the extent of fraud and deceit involving Chinese companies. Had a good day yesterday but......
DeleteMark - What's your thinking on SEDG? I got burnt by that thing last year (lost about 10% in an hour on it) so I'm gun shy. Its still growing like a weed and based on EPS its cheap. If this was 99 this thing would be at $100 but we are in a far different market. It's building quite the bull flag and 4 month wedge. I've been watching SPWR closely...chart looks worse but it too has been building a wedge for almost 8 months now.
ReplyDeleteI have noticed a couple of articles recently about states pulling back on subsidies to solar companies. I think Massachusetts just put through a cut, maybe that's why they're stalling out. FSLR still can't seem to get above its price when Goldman or JPM issued a conviction buy literally at the top in January.
Final warning, CP. We're quite tolerant in general, but there are comments that will need to be checked at the door, and not displayed on the blog.
ReplyDeleteI tell you what I think, not my issue you can't accept that. Good riddance.
DeleteHinterland, Season 2 on NFLX. Even better than Season 1.
ReplyDeleteTrading is hard and being wrong alot is just part of the game. Those who are here probably do so to share ideas. If you are not happy with your outcomes, you have to look at the mirror, for that reflection is responsible for the outcome. Outcomes can be changed by changing the process and that's where one should seek to improve.
ReplyDeleteHe goes on: "I am not very good in the company of others; with the greatest of respect to bank credit analysts I've never had a call from a buddy at Goldman Sachs, JPMorgan, Morgan Stanley, so I am the author of my own mistakes, but I want to tell you I am very, very good at making mistakes."
http://www.zerohedge.com/news/2016-04-10/i-used-be-big-deal-and-then-billion-dollars-walked-out-door-hugh-hendrys-sad-story
As a side note, I do very little here now or in the market, since my junk returned and I'm working to again gain my health back. Remember we are like buddies in a foxhole when trading and are here to watch each others back and share.
Sorry to hear about your health. Hope things get better for you
DeleteT3 - Sorry too to hear about that man. What treatments are you taking now to help?
DeleteTake care of yourself, T3D! Take care of your Spirit -- the Body keeps changing and will do so till the end, just like your clothes...
DeleteAccording to Gurufocus, looks like Klarman sold the majority of his position in BXE in first quarter of this year... Not a good sign, but who knows the whole story ...
ReplyDeleteLots of signs point to the market rolling back over again. Definitely going to be staying mostly in cash until we can take out the recent highs.
ReplyDeleteStrictly looking at the charts, I see IYT, QQQ, XLF all rolling back down and in sustained downtrends with lower highs. The savior will probably come from oil. If that can rally to new highs I would suspect that supports the market. Crucial couple of weeks coming up here with earnings beginning.
DeleteTele- Might be the same here with Patrica. Kick ass dude, it's all we got.
ReplyDeleteSEDG- TOF, pretty simple play I guess. Growth is great and they actually earn real money. I also like the tie up with TSLA, although I really suspect TSLA wont put much into this area. Also, panels are getting cheaper and more efficient...making it pencil out for more people. From what I'm reading/hearing, subsidies will be more tied to storage than anything else. net zero for SEDG, potential huge + for ENPH if the stupid "Energy Solution" actually catches on.
ReplyDeleteGrowth and EPS for SEDG have been awesome. I still have this feeling that the inverter industry is nothing more than a commodity at some point and one that a GE would come in and crush, but I don't know enough about the technology.
DeleteThat ENOC has a tie up with TSLA too.
TD Quant guys liking Gold, buying AEM, AGI and NGD:
ReplyDeleteAs we discussed in our Monthly Overview, we believe that capital markets are
beginning to discount a late-cycle macro transition from disinflation to rising
inflation expectations. This transition and the commodity rotations that follow may
be complicated by the lack of global growth and excess commodity supply,
particularly for oil. As a result, the re-inflation theme is predominantly in the U.S.,
which we believe could lead to a much slower transition into the re-inflation phase
relative to past and more global transitions.
The re-inflation phase should initiate a series of rotations, including a
style rotation from growth stocks to value stocks and a sector rotation from early-
mid-cycle sectors (consumer) to later-cycle sectors (industrials and resources). It
should also initiate a commodity rotation in which gold becomes the lead
commodity.
We believe that the current macro environment is supportive for gold, which
historically has always been the leading commodity in the disinflation to inflation
transition. Gold stocks typically outperform bullion through this period, as we saw
at the beginning of this cycle in 2009–2010 and in the above-mentioned transition
periods. We are again seeing relative strength in gold stocks over bullion in the
current transition. Also adding to gold’s appeal are negative global interest rates
and negative real interest rates in the U.S.
This raises gold’s value as an alternative
asset, in our view.
We believe that until the Fed raises rates and negative U.S. real
rates turn positive, gold should continue to recover.
If rising inflation expectations can transform into rising growth expectations,
confirmed through a Fed rate hike, we would likely begin switching our gold
positions into other commodities. At present, the rotation is compromised by
excess supply in most commodities versus soft demand. We would argue that this
raises gold’s relative appeal given the inability to rotate into other commodities,
particularly oil. This is the opposite scenario to what the market experienced in the
1998–1999 re-inflation recovery when oil underwent a V-shaped recovery
following an OPEC supply cut. We believe that the current situation could lead to
a much slower rotation from gold into the other commodities, perhaps similar to
the later 1980s. As an investment strategy, we would look to accumulate non-gold
positions on weakness through 2016.
The whole inflation thinking seems to be catching favor with a bunch of guys I read like CrossingWallStreet and James Paulsen. I'm skeptical as I think globalization + internet are pretty significant deflationary forces.
DeleteInflation / deflation tend to run in cycles. Things have been deflationary for a while now because of the internet and trends like China urbanizing and creating a large pool of cheap labour. But I read that pool is getting small now and unemployment is down in the US, so that will push wages. Also, you have states like California bumping the minimum wage to $15.
DeleteI think it will be more of a cost-push inflation with rising costs like wages pushing up inflation unlike the demand-pull inflation we saw in the 1980's where people bought stuff now because it would be more expensive next year.
The other thing is it would be best for most governments to have higher inflation to help reduce the value of the debts they have taken on over the last number of years.
I doubled down on MTCH and BIIB this morning and sold UAL too early. Pissed I didn't hold those euro banks. Too chicken
ReplyDeleteLooks a bit like the fun old market of 2015 is creeping its way back into our market again. The one where every stock you purchase is immediately down 1% while the overall market does nothing but bounce up and down. I might just go back to playing the oversold/overbought readings on SPX again as this type of market just chews you up. I got lucky on the last run up and have some solid gains this year so I'd like to avoid the grind that was so prevalent in 2015.
ReplyDeleteFinally some positive action for me here. :) USLV hit my sell limit at $14 for the shares I added recently at $11.94. I still own the original bunch I purchased at $12.81 -- will wait on selling it until USLV will break out to new highs and get overbought.
ReplyDeleteRotated part of the money I raised into UGAZ. It seems to have entered a range-bounded phase, so I purchased some at $22.25 and placed a sell limit on it at $24.25.
DeleteAlso, MTL got close enough to its previous highs (it was only a matter of time, with both SLX and RSX going up), and so I sold at $1.98 the last bunch of shares I added at $1.78. The remaining bunches were purchased between $1.94 and $1.85, so they are all profitable now. Will sell them gradually, though.
ReplyDeleteI looked at the USLV chart and figured that if it spikes to $16 in a short order, then a pullback will follow with a high probability. So I just placed sell limit orders on my USLV position in 2 steps: at $15 and at $16, for the shares I purchased at $12.81.
ReplyDeleteLot of Peter Schiff ads popping up recently - that has be a good sign that the markets are done their downturn!
ReplyDeleteMike, are you still following TA. It has gotten really cheap, but the Seeking Alpha articles make it sound like is a mess due to the management structure.
ReplyDeleteManagement structure is horrible. They are siphoning off the profits thru their leases with HPT. Too difficult in this environment is my thinking
DeleteWent to flat at the close. Took a 1+% hit today. I think the funk has definitely returned to the market
ReplyDeleteSO, the market has basically been flat for a month and:
ReplyDeletehttp://blogs.wsj.com/moneybeat/2016/04/11/a-measure-of-stock-market-fear-just-hit-an-all-time-high/
"“It’s not so much that people are panicking and buying downside protection, but there’s this extreme pessimism or lack of confidence that the market can go higher from here in the next three months,"
This chart doesn't really coincide with market moves though. Look at how low it got during the drop in Jan/Feb. It's almost as if it's a double contrarian thing.
Delete4 days now of selling the open. I'm guessing a turn around today.
ReplyDeleteCouple more small sales - the remainder of ORI and I also sold arb play JST. JST takeover vote is next week and still 2% below buyout price, so I would generally always wait for the deal to go through and get the full money, but TD keeps sending me mail asking me to vote and I got a reminder call (I already did vote), so I'm just a bit concerned that the deal won't go through. The first buyout offer was at $8.00, so I know some people are pissed at the $6.00 buyout.
ReplyDeleteNot in a rush to redeploy cash as most stocks have had such a good bounce recently, so will be patient and wait for good opportunities.
Mark, good luck with Patrica.
ReplyDeleteLong a little RIG, perhaps its hit bottom.
ReplyDeleteI picked up PBR at $6.08 today only because it's the biggest POS I could find in the large cap oil space.
ReplyDeleteLook at the chart of PBR. It is a textbook example of a breakout above the 200 DMA with a backtest. It reminds me exactly of the breakout in the S&P 500 back in June 2009. I was highly skeptical of stocks then but just went with longs because the market refused to pull back on bad news and it also had this bullish technical breakout up above its 200 DMA.
ReplyDeleteI'm fundamentally skeptical of oil but gotta just go with the technicals and what looks like the exact same setup as stocks in 09. Worth the risk IMO
UNG is continuing its pattern of day up / day down. The sell limit order at $24.25 was hit today for the UGAZ shares I purchased yesterday at $22.25. Placed a new buy limit order at $22.
ReplyDeleteLook at the 3-month chart of WTI -- the pullback seems to be over. With USO and XOP breaking out to new highs today, it should not be long before WTI follows the crowed to new highs. Placed a sell limit order at $3 for the shares I added at $2.20 a couple of weeks ago.
ReplyDeleteMy original ill-time investment into BTE in November 2015 is already green now! WTI is not there yet, but I hope it gets there soon!
DeleteLook at the 6-month chart of MOS -- isn't it a classical launch off the bottom followed by a shakedown that seems to be over now?
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