It's been almost four years since I capitulated in early March 2009, only to slam the clutch and reverse into 3x longs the following day. Four years is a long time, bro.
We're all subject to the recency effect, but let's zoom out to the forest for a moment. Despite my reservations about his trading style, I can't argue with Hussman's data. And Q1 2013 just doesn't seem like a good time to be long.
Winston Churchill built an entire career on early recognition of the dangerous developments in Germany. A self-described voice in the wilderness while the rest of the Europe danced amidst the winds of war.
Investor psychology changes quickly. It can revert to a bearish mindset in a heartbeat. Disappointing earnings/projections-> institutional selling-> multiple contraction/lowered targets, and we're back to 2009: looking for new lows on a daily basis.
Get out while you can.
Only problem I have is too many of us seem to agree.
ReplyDeleteNot really. Most of us are 'agreeing' only to a short-term pullback, not an extended decline.
DeleteSo?
DeleteThat most of us recognize risk is a testament to our collective common sense.
If you are long, then by all means set stops and remain long. If you are the hedging type, then hedge. However, the top of a big retrace with no pullback is a foolhardy place to take on more long positions or to not be taking something off the table. "Too many of us" is how many? We're not the market.
So let's say you are long. If the market moves higher, great. Move your stops up and add on a orderly pullback that reasserts to the upside. A pullback would reduce the risk.
Should you get short? I'd say it's early. You have no confirmation from the market that it's going to roll over. I think it's foolish to go short just because we are at high levels.
Let's say you are neutral and out in cash. Should you add positions? It depends on the positions. There are stocks that will move counter to the market, but you have to know which sectors and which stocks. Those long basing pattern stocks have done what they're going to do.
If you want to short, then you should probably populate your list with the top heavy stocks in sectors that are rolling over, or of you like those ultra-short leverage etf's, go for those *when they signal a buy*.
I'm not a prognosticator, I'm a neutral observer. I do have biases but I fight like hell to block them out and just watch the charts.
That said, Jesse gave us a good list of which some are working. Coffee is doing well. JVA and JO have been strong in the face of sideways action and weakness elsewhere. NGAS has been strong as it has been before during sideways/corrections. It's probably late for NGAS though. Propane was strong the last couple of weeks. There is a solar ipo that is moving counter to the markets. Uranium looks like it will go. Transports (ex Yellow) have been strong. Food is strong.
Financials have been weak. Maybe look to short the sector or an individual stock if you play the short side. AAPL is done. Put a fork in it. Even the news is reporting their moat is broken and the alligators are dead. It's all over but the crying.
INTC retraced and is rolling over. It doesn't look good for computer tech.
If we are feeling the risk in the overall market, then what does it take to get a correction? If no one is buying and they are pulling their bids then the process of a top is playing out and we should be sitting on our hands and waiting for our pitch. I'm all for new highs, but I can't ignore that charts.
Hey! That's a pretty good 'big picture' summary, bro.
DeleteUseful observations, CC. Financials do tend to lead the market and weakness in the space is just cause for concern.
DeleteI'm suspicious recent weakness in this space may be another bear trap though, an unproven premise based in large part on the advent of a global rally.
INTC's problem IMO, is they are not the true manufacturing innovators nor are they product innovators. However, it may be possible for them to buy their way out of the box once again?
Oh but I so enjoy, Hussman's daily dose of diatribe.
ReplyDelete(a) AAII http://www.aaii.com/sentimentsurvey. That's not bearish.
ReplyDelete(b) http://buzz.money.cnn.com/2013/01/17/stocks-funds-inflows/. That's not bearish.
No one's really bearish.
RE: Money flows. I'll quote from the article, correcting their one mistake (year): "Market timing can be tricky and more often than not, individual investors have tended to come in late on the rally. With stocks at five-(year)highs, it remains to be seen if the inflows (and the bull market) will continue."
DeleteAbsolutely. I think this could be viewed as bearish. We are at five year highs, all the retail 'investors' see the market jump Jan 2 and the money flow peaks at the highest since when? 2007. Can I emphasize that enough? ***2007*** The PEAK of the last insanity. Isn't this classic?
Buy high, sell low, re-enter high?
I was buying into the year end weakness and selling into those retail 'investors'. I can't be alone. Those people are your prospective sheeple. Herd them on the train and then run it backward to the last town.
This combined with the technicals (which is really all I look at) doesn't strike me as low risk.
What will happen on a pullback? Will those that bought from me the last few weeks be the weak hands that jump right away on a pullback?
So I'm still in 'show me' mode. If we make new highs and then have an orderly pullback then great, but if all that new retail money jumps, it won't be all that orderly.
Look at the first week or so on the S&P. A big spike up (fiscal cliff news), then what happens? Kinda wandering sideways meandering flag pattern with lost momentum at the high since 2008. What news drives it higher now? The chart screams caution to me. So it really depends on what you have going and if you have any positions as per my previous post.
Look at the money flow trend on this chart. It is possible that there was a spike up from 1/2 to 1/13, but it could be debated that it was dumb money.
Deletehttp://goldstocksforex.com/2013/01/17/stocks-the-year-ahead/
Please take note of the money flow and momentum on all the foreign indices. Exactly opposite the S&P. Who wins? I think if we correct they do too.
DeleteI kinda hope we do experience a deep pullback though, I'll probably just load up on insurance if this happens.
ReplyDeleteI have a friend who made boat loads of money on insurance decades ago, just cannot recall the circumstances, perhaps they were similar to today's?
Sorry i'm still trying to figure out if i'm dumb or smart money.
ReplyDeleteYou're dumb if you're not wondering and smart if you get it right.
Deleteone thing i do know is that NLS almost always tops out right at market tops. RSI_EMA on NLS is at 93 which is right around the highest any stock can get.
ReplyDeleteSo develop a strategy........
ReplyDeleteWhy should we witness a 50% retrace? Could be the next crisis is just around the corner? That would do it....
So going short here your hazards lie in whether or not we retrace to the current level or lower once the selling begins as it always does, right? What are the chances if we average down on shorts going forward, adding once a month or so until the top clearly presents itself? 1500, 1525, whenever it happens? There are numerous stocks which have yet to recover while others don't appear to have considerable upside remaining. Indexes can go much higher from here? How much, realistically? Short indexes(S&P?) and long stocks that have already bottomed or are in the process?
USD/JPY monthly RSI_EMA is at 78...highest it has been since March 2001. In 6 months it was down 10% and over that time it never went higher. before that it was a little less than this high in Jan 1997. it did rally 2.5% higher 3 months later but 4 months later it was down 10%.
ReplyDeleteI've seen lots of people recommending going short the yen over the past week or two. while i agree it's a long term trend in the short term there is little room for additional upward movement in it.
http://finance.yahoo.com/blogs/daily-ticker/yen-doomed-japan-time-really-different-merk-says-154750780.html
SNE weekly RSI_EMA is at 71. not excessively high but the last time 4 times it got this high (April 2009, Jan 2010, Oct 2010, Feb 2010) each time it rallied about 5 to 10% more then it dropped at least 10% below where it was when it was at 71 or higher. Just something to keep in mind if we feel like we missed the trade.
However, this is after a large bear market and i think there is significant upside. If we look at NOK to get a gauge of how it traded, it peaked at 71 as well on the week of 11/19/12. the following week it gave back half of the gains from that week but then it went on to rally over 50%. i think the same can happen with SNE. i really like looking at NOK as a gauge since in many ways they are similar trades: they're both sum of parts trades...that is the sum of their parts are worth more than the market is giving them credit for.
if i look at the daily (not weekly) chart of NOK i see almost identical moves off the 7/18/12 low. 28 trading days later it peaked out at $3.4 with an RSI_EMA of 76. 7 trading days later it was at $2.3. it gave back 63% of its gains from the lows and RSI_EMA pulled back to 30 and bounced. 30 is the line in the sand that I usually look at to see if something has bottomed. If it immediately bounces from there and the stock puts in a higher high then it's a partial buy (i.e., buy then and then buy again if it retests 30). if it doesn't bounce there then most likely its going lower and i wait for the RSI_EMA to bounce above 30 before looking to buy in piece meal. RSI_EMA is a study that can be added to charts in ThinkorSwim. I would highly recommend using TD Ameritrade and their ThinkorSwim platform. It is a huge help in determining buy/sell points. I think using support/resistance lines is the best thing but this indicator helps as well.
If we do the same math and assume the same scenario with SNE (which currently sports a RSI_EMA of 85) then it would drop to $10.73 at some point over the next 2 weeks. RSI_EMA of 85 on the daily chart for SNE is quite high. Out of the similar stocks (RIMM, NOK, HPQ) any time any of them hit 85 or higher they dropped fairly hard within 3 days.
Thank you, Jesse, for thinking about me yesterday. This has been a life-changing experience for me. Or I should rather say I am trying to make it into a life-changing experience.
ReplyDeleteI remember reading the book "The End of Your World" by an enlightened Zen teacher Adyashanti (www.adyashanti.org), where he said that his spiritual path was a path of failure. He used to be a competitive bicycle racer, winning at high-profile competitions, and he prized himself on being more physically fit than 99% of the people around him. That was his *identity*. At some point, he developed a physical ailment and had to stay in bed for 6 months. His doctor warned him that he should abandon any thoughts of getting back on his bicycle. But being a very persistent person, Adyashanti (or however this guy was called before he took on a spiritual name) got himself out of bed, started gradual exercises, and in 6 more months he was able to ride his bike again! After a little while the ailment returned, this time with vengeance. His doctor said that there is a chance that he won't be able to get up from bed ever again. Only at that point did Adyashanti have to accept the fact that he is no longer an athlete -- he is an unlucky failure with no future ahead of him. This realization set him free -- he was no longer bound by a self-made identity, and progress could really start happening on the spiritual path.
I think the latest news of production problems with AUMN is a clear sign for me that I am not a smart investor who can easily double his money every year. Instead, I am an unlucky failure. Really, first ECU was promising a lot but not delivering, then AUMN took over, promised a lot right away and did not deliver, then they made some more conservative promises and did not deliver -- I can't say that it is malicious, but it is definitely unlucky for me. But that's a great lesson for me, and without it I would still have believed that I can shape my future with my brains to my liking. Now I have a chance to realize that the true and safe way to live life is not to attach my identity to any thoughts about the future that might appear in the mind. In fact, there is no need to attach identity to anything, since the act of attaching identity is another "movement" of the mind. As such, what remains is to rest the mind in emptiness, in silence and feel the world with the heart. The heart will give a signal whenever something needs to be done (done not for me, since Self is an illusion, but done for the benefit of others), and the body will then act. Very simple life -- do what needs to be done now, without any hopes about the future.
The bright side of this is that I am learning this lesson while I am still young. That's what 2nd_ave said to me in his infinite wisdom a couple of years ago, when he saw that I am getting into a very dangerous and undiversified investment.
Interestingly, if AUMN would have delivered on their original promises in 2011, their stock would have been at the new highs by now, and I would have probably bought a house already. However, as I was imagining owning a house last night (rather, I was imagining what is it that I am losing), I realized that it would only create an extra identity for me -- a homeowner. I don't want that identity. I am enjoying the fact that I am nobody now, meaning that I am a free person. So the fate actually had done me a favor by making another production delay at AUMN, as it allowed me to live the life I enjoy living for a longer time. And I am actually very lucky that my wife shares this view with me and also does not want to deal with the burden of homeownership. She also enjoys living a low-profile life, and thus we can be on the same page from now on, now that I'll have no dreams about the future.
Not exactly, David.
DeleteThere is a measure of 'enlightenment' that arises from 'failures' in life. Jesse's own biography can attest both to the power of failure, and the desirability that failures occur early in life. But it doesn't end there. I should say it needn't end there.
Metaphysical laws (for lack of a better term) resemble physical laws in more ways than one (likely by design). Major pullbacks in the market are necessary to launch extended bull phases. Likewise, major setbacks in life are necessary to launch extended periods of (real) success. I was fortunate to experience both personal and financial setbacks in my twenties and thirties, and with regard to the former quite debilitating ones at that. Most of us (myself included) do not seek those kinds of experiences- we go out of our way to avoid them. Yet you'll find those experiences in the backgrounds of all (truly) successful people. Thirty years on, I recognize (along with many others) that what first appeared to be a black cloud was in fact the anointing of our heads. So cheer up! You've been anointed, and in 10-20 years you'll know what I mean.
Well, whenever Golden Minerals completes their San Mateo ramp, they will be able to quickly ramp up their throughput to 850 tpd and then, in about a year, to 1150 tpd. So there is still a chance that my port will rise to all time highs. But now I won't dwell on these thoughts and won't advise anyone to invest in AUMN. I won't dwell on any thoughts (including negative thoughts my luck -- I know better than to believe in negative thoughts, ghastly visitors in the silent emptiness that encompasses the world and within which all processes unfold), and instead pure awareness will watch the events unfold and will motivate actions whenever necessary.
DeleteDavid- Do you know who will wine the 49ers/falcons game tomorrow?
DeleteMondavi?
Deletewine...Hmmm, perhaps I will! :)
DeleteOne final piece of advice, David. If you insist on playing out the all-in gold trade, consider trading in your AUMN positions/options for comparable ones in another of your current holdings, GDXJ. Should gold prices climb to 2000+, there's no guarantee AUMN will lift, but GDXJ undoubtedly will. You will considerably increase your odds of a win, while giving up very little in the way of potential percentage gains.
DeleteThat's a good advice, 2nd_ave. I have already purchased some calls on GDXJ and SLV in mid-December (have already closed the SLV calls, but will re-open them if the metals go down), and I have recently purchased 1000 shares of SIL in expectation that silver miners should follow silver up. And until 4Q2013 I won't be buying any more AUMN unless it drops below $3.50.
DeleteOn Friday, I sold about 100 contracts of $2.50 calls on AUMN and then sold 5K shares of AUMN. So now I have raised some capital exactly for the purpose of being able to buy, during the next sell-off, some other mining indices or SLV. While I was stubbornly holding to my AUMN during market-wide sell-offs because I naively believed that they will deliver on their production promises, I will definitely not do that with mining indices, since I know that they will go down during a market sell-off. At this point I want to wait for a sell-off before adding to my GDXJ/SIL positions.
MLNX - LOL, right shoulder is lower than left shoulder.
ReplyDeleteI still cannot find a compelling fundamental reason to buy this thing and the chart supports the thesis pretty well.
Interesting stuff by Ron Sen
ReplyDeletehttp://ronsen.blogspot.com/2013/01/saturday-morning-coffee-rule-of-10.html#!/2013/01/saturday-morning-coffee-rule-of-10.html
David is an AUMNinKnight in armour.
SCTY- This one makes no sense to me what so ever.
ReplyDeleteThe chart? If you are trying to think of more than the chart then that is why you're stumped.
DeleteNot so hard to understand, it's the Amazon of solar?
DeleteIf I was a California contractor I would study this business model carefully.
DeleteWe don't have anywhere near the sun and calories falling on us in the PNW and our local public utility built a giant new headquarters with a giant solar installation.
The contractor financed it, got the government subsidies and credits, the PUD contracted for the power and the payment schedule to the contractor and in doing so the PUD got more government write offs and credits. A great deal for both the public utility district and the contractor.
Solar City does something similar for private parties and commercial installations, plus monitoring, maintenance etc. The exceeded their installations by 10 megawatts and they plan on even more in 2013. Now with all that BS aside, the chart is lower on the left and higher on the right, which is good by me. I'm up and green.
David - That was some heavy stuff man. Part of me thinks, hey man, you're taking it way too seriously. It's just money yada yada yada. But that's bullshit. You should take it seriously and you should take it personally. You should spend the next several weeks/months reflecting on the things you did wrong. What was it that you did wrong? Look at past failures to see if there is a pattern and after you have identified the pattern work as hard as possible to fix your errors in the future and fix your trading methods.
ReplyDeleteInvesting is a process of constant self improvement. It is both an art and a science. To be successful at it you have to have a good understanding of technicals, fundamentals, near term catalysts, as well as (and most importantly) your own mental makeup. Are you a risk taker? Are you short term oriented or long term and is your investing style aligned with your mental makeup? Can you take big hits and sit through them, knowing that your initial analysis was correct and that the stock will ultimately be significantly higher? Can you admit that your wrong? Can you identify the possible pitfalls of your analysis? Do you have the self discipline to cut your losses early if it looks like you're wrong? Can you dust yourself off and pick yourself up after making a mistake or a series of them? These are all very serious questions that we all need to ask ourselves if we want to be successful at investing.
I personally blew up my account numerous times through options trading and realized that no matter how hard I tried I couldn't sit through the swings that come with options trading and I couldn't master the art of getting the timing and the move correct, which is what is needed to be a good options trader. I realized that I was going about it completely wrong. The worst part is I had an investment account for my furniture company that I did options trading in and lost all of our money - $65,000 - over the span of 12 months and almost bankrupted my company. At the same time I had my own individual investment account where I only did stock trading and that account was up several hundred percent during the same period.
So on the one hand I had a lot of personal success with investing and knew that my method of investing was working, but my success was in my own personal account and only I was benefitting from it. My company's account was wiped out and I had to live with the guilt of losing my family's money. It was gut wrenching to say the least. I was carrying a lot of shame and self loathing.
After a good deal of personal reflection, I dusted myself off and removed options trading from all accounts (other than a small account that I have that is my own and if I lost the money in it I wouldn't care) just so that I wouldn't even have the urge to do options trading. I avoided investing our money for over a year to get over the self guilt. During the time off I realized that I needed to swallow my pride and admit that I just don't have what it takes to be a good options trader...and that there was nothing wrong with that.
I started putting our money to work 2 years ago and over the course of the past two years I turned my company's $15,000 into $59,000. I'm now well on my way to making all of our losses back. I'm looking forward to the day when we have completely recovered those losses. But this whole process was tough. It took a full year of self reflection and lots of reading and researching to come to the conclusion that I was a failure at something and that it was ok to be a failure at it, because there are plenty of other ways to make money in investing.
I believe you will go through a similar process because you have the ability to reflect upon your experiences and take knowledge from them. Many people lack this and I think it's the reason you will ultimately become a very successful investor. It is a process of constant self improvement. Best of luck my friend.
Thank you for the good advice, TOF. I think the biggest mistake I made was ignoring the risks that come from investing in a single company, especially a mining company. There is probably a reason as to why such upcoming producers are so cheap. Big money boyz are not stupid. They know that the miners always make predictions based on the best-case scenario, and thus there is actually a LARGE probability that their forecasts will not be met. The reason AUMN delayed their production is because they said that some veins from which they were planning to extract ore turned out to be very narrow and thus not mineable. Moreover, their gold extraction rate was 33% lower than in previous quarter because they hit some different mineralization, and they had to find a new method for extracting gold from it. This will always be the case with every miner -- we cannot expect the veins to always stay wide and have the same "nice" type of minerals. Now that I know it, I should really reduce the risk I will be taking from now on with any individual miner. Instead, I actually thought that I should come back to trading (I abandoned it 2 years ago, thinking that I'll make much more money with lucky investing). In order to do that, I need to set aside large amounts of free capital, so as to really be able to take advantage of repeated regular sell-offs in the mining sector and quickly take profits as we come out of those sell-offs. I made WAY TO LITTLE money over the past 2 years during market-wide and PM-wide sell-offs because all my capital was tied up in AUMN. Not any more. I now have some free dry powder, and I'll go in big time during the next sell-off.
DeletePlatinum - Too funny, do you think maybe the bulls rushing into Platinum on news of SA mining stoppages are now about to be/being gored?
ReplyDeleteDo you guys know of a company that might offer a pressure sensor that we can add to chairs to tell the owner of a store if a person is sitting in the chair? ideally it would be a sensor that can be screwed on to a wooden chair and would communicate to a computer electronically and wirelessly. it could also be a sensor pad inserted into a seat pad but that is not ideal (b/c the owner prefers the seats to be hard so that customers aren't comfortable while sitting (i.e., will prevent people from sitting on seat for hours)).
ReplyDeleteYou might use a strain gauge sensor for that application, I'm sure you can get one from NATI catalog, or since you're in Cali you may find one on the local shelf. Might depend somewhat on how the chair is constructed(single post on pedestal, three leg stool, four corners, is it possible to place a simple sensor mat under the floor covering, or perhaps use a set of optical sensors or proximity sensor?
DeleteWireless, huh? You're not asking for much but these guys have wireless support for their transducers but this involves harvesting the energy, (load/displacement/strain/thermal):
http://www.microstrain.com
Or how about modifying a wireless driveway sensor? Not sure I'd want to be the guy trying to keep batteries in something like that.
Anyway, I used to check with Quement Electronics for stuff like that: 408-998-5355, or possibly Zack's 408-942-5432, heck why not even try Frys?
If no luck, try the Mectronic Buyers Directory as well:
http://www.mymectronic.com/home.php
Graingers may also have something already intended for the purpose:
http://www.grainger.com/Grainger/wwg/viewCatalogPDF.shtml?browserCompatable=true&adobeCompatable=true
You could even use a cheapo thermal differential transducer as well, that might be easiest.
DeleteForgot to list Omega, these guys have lots of goodies too:
Deletehttp://www.omega.com/toc_asp/subsectionsc.asp?subsection=b05&book=pressure
I've got a hand full of parts here, I could easily build you a self-compensating thermal differential sensor to detect body heat in the wooden seat but making it wireless would be your task.
DeleteHere's a simple device that might be adaptable, probably need to define how robust and quantity of order your application needs are, in order to determine how far to go in terms of development:
Deletehttp://www.gadgetshack.com/mailbox-alert-mail-letter.html
Nice SPX and VIX chart going back to 2004.
ReplyDeletehttp://advisorperspectives.com/dshort/updates/Current-Market-Snapshot.php
Good discussion on the blog today.
ReplyDeleteDavid, the only thing I would add is you an definitely make money in investing as well as trading. But it is more important in investing to think about risks, diversification, fundamentals, etc. than in trading as you want to make good long term decisions that you can hold onto as opposed to getting "stopped" out. I think your analysis on AUMN is good and it does have good long term prospects, but if you are going to invest, I'd say you need at least 10 stocks across 5 industries and perhaps more as your portfolio grows.
Well said.
DeleteOne other thought - a lot of people are trying to play a near term top in the market. But it seems like a lot of focus is on this being a short term top. Objectivetrader is looking to play a 3-5% pullback, which is great if you can get it, but not really that important in the grand scheme of things.
ReplyDeleteI think it is wrong that people are saying the market is putting in a longer term top because mutual fund flows are so high, the vix is so low, etc. as these are the first time we are seeing these things this market cycle. For example, if you look at the charts T3d posted above, sure the VIX is low now, but the last cycle it was low for about 3 or 4 years before it mattered. I think the market here is more like the market in 2004 where we've had a good run, but there is still a long way to go. We don't have business excesses in the system which need to be wrung out, and we don't have outrageous over-valuations in the market which need to correct. So while we could see a short term pullback here, I really don't think it is time to think bearish at all.
CHK - A new higher high, may be rallying out of the congestion area?
ReplyDeleteBACML: Price Objective $36, upgraded Jan 4th at $16.62, theme is asset sales.
"We value Chesapeake using the aggregate of two measures: Discounted Cash
Flow (DCF) and Net Asset Value (NAV). First, we look at the estimated Net Asset
value of the existing portfolio.
For the P1 value we use the SEC declared proven reserves and projected
capital to bring PUD’s to production. Cash flow per Boe is based on our
normalized estimates using $90.00 oil and $5.50 US natural gas; however,
near term estimates are higher for oil, while we don’t anticipate a recovery in
gas to our long term level until 2015.
For additional resources where an active drilling and development program is
underway, we estimate the risked NPV using a typical decline curve for each
play, aggregated over time at a rate that reflects the Company’s stated
drilling inventory.
Our second measure is based on Discounted Cash Flow valuation that assumes
production as a going concern beyond five years.
In both cases we use a weighted average cost of capital (WACC) of 12%, above
the industry standard to reflect CHK’s higher leverage and management risk. We
also add the current value of future drilling carries, and the assessed value of
CHK’s non-core assets (Frac Tech etc)."
Maybe now that they have collared Abury??
ReplyDeleteMaybe over the hump.
DeleteMight get in under $17.40 if market takes a poop this week or even lower if said poop doesn't flush well?
DeleteEUO - Euro's kinda high, time for a beating at some point?
ReplyDeleteWell, maybe not as high as it could go depending on how much developed country governments continue buying it... Why not buy the euro-public debt and forgive it, that would be a great sink-hole for citizen wealth.
DeleteNow American men aren't measuring up?
ReplyDelete"China's metrosexual men revive luxury shopping
January 20, 2013 03:59 pm ETReuters"
Haven't read the BC report yet but I have a feeling I could write the PM section myself and come very close.
ReplyDeleteSNE - I see BACML issued a research report and published it Jan 4th, I bet you guys already read all the analyst reports?
ReplyDeleteTheir rating as of this date was neutral with a price objective of Y980
The summary went like this:
Delete"Investment Thesis
Our Neutral rating on Sony is premised on: 1)
though earnings are set to be weak in FY3/13 due
to the strong yen and restructuring, we still expect it
to be profitable thanks to restructuring enacted from
2012, 2) little risk of additional impairment losses,
so major downside to BPS looks unlikely, and 3) the
lack of any catalysts to drive substantial share price
upside."
ANR - BACML downgraded this one Jan 15th, PO is $8
ReplyDeleteSCTY - Initiate at buy, Jan 7th
"Morning Meeting Notes: AM Call: SCTY (Initiate at Buy); MTD
AM Call: SCTY (Initiate at Buy); MTD (Upgrade to Buy); RATE, YHOO, OPEN, GRPN (Raise PO); US Oil and Gas, Wireline & Wireless Telecom Services, Internet/e-Commerce, Aerospace & Defense
Download PDF Report (420kb)"
I've come to distrust the motive behind share buy backs, however:
Jan 14th:
"MetLife Inc.: Completion of bank sale an expected, but positive step
MET announced completion of bank sale to GE. We are optimistic that MET will shed bank holding company status by early to mid 2013. We would view share buyback in 2013 as positive for name. Buy.
Download PDF Report (159kb) »"
I think I can say, without getting into too much trouble, that SCTY is a service pick.
DeleteFull disclosure: I have a position.
SCTY - BACML PO is $21
Delete"Initiating/Reinstating Coverage
DeleteSolarCity (SCTY, US$14.4, C-1-9) The first of its kind –
Initiate at Buy, $21 price objective
SolarCity is the first publicly traded company focused on the business of leasing
solar power arrays to customers. We believe that SolarCity’s business model has
significant growth potential, and we also believe that the company has built an
industry-leading brand and strong competitive position. We expect the
addressable market to continue growing. The company’s business is capitalintensive
and financially complex. Buying and installing solar arrays is expensive,
while the resulting cash flows tend to stretch well into the future. As the business
grows and cash flows begin to accumulate, however, we see the company
generating substantial value for shareholders."
Without getting into trouble? Ha, I don't wonder so much about that as opposed to why most ideas are summarily thrown into the dumpster without so much as any inkling of consideration.
DeleteIn light of the fact that I pay for the service and don't want to violate the terms by giving away too much info. I figure you guys are all more than smart enough to figure it out.
DeleteYep, there's just way too many ways one can get himself into trouble these days.... All's fair in love and war as far as I'm concerned though, I'm kinda used to breaking rules and stepping outside my comfort zone.
DeleteMORE SUGAR!!!!!
Jan 17th - INTC:
ReplyDelete"Change in Earnings Forecast
Intel: Business model in transition, positive thesis intact
Q4 results and Q1 guidance largely inline with the weak PC market and macro. Maintain Buy, 2013/14 EPS estimates and $28 PO.
Download PDF Report (301kb) »"
It's always strange not getting 'ready' for Monday trading...
ReplyDeleteDon't just stand there, do something! ;)
DeleteI'm drinking some red wine and thinking about some home improvement projects.
DeleteCC- That's what my wife does!
DeleteCC has been well trained, Mark may be untrainable.
DeleteI meant house trained.
DeleteWives do that.
DeleteWomen have been trying to train me for 30 years. It's really quite cute of them. And equally useless.
DeleteAtta Boy! ;)
DeleteOkay dudes, let's get small.....very small.
ReplyDeletehttp://hubblesite.org/gallery/album/nebula/pr2009032c/xlarge_web/
I never can seem to remember the future but I do know you've got to start young if you're going to stick it out. Just don't take the brown acid.
DeleteI vividly recall a flurry of comments like this around the beginning of December, regardless of the fact it appeared to me economic conditions were improving(actually still are, IMO):
ReplyDeleteDec 3, 2012: "Time For Equity Bulls To Take A Breather As Major Indexes Hit Supply Zones"
As Copper Coils...... I see this and wonder if perhaps copper isn't about to break to the upside or in the least perhaps, downside risk is low:
ReplyDeleteJanuary 12, 2013: "Rallies in the equity markets have been led or supported by the copper market since the low of March 2009. But that has not been the case in the latest rally which began in September 2011. Based on what we know of the copper and equity market link the current rally in stocks looks suspicious."
Colonel Possum on gold, his forcast last week was kinda off the mark except the week did start off weak if I recall. Anyway, in his report Friday after close he thinks $1705 is the next level.
LVLT - BACML has assigned a buy on this one, latest report Jan 4th I think it was included with their long list.
ReplyDeleteWhat are the chances it gets sold off going into Feb 12th earnings as nervous nellies take gains?
GRPN - It's not impossible this one moves up I suppose. I'll check and see this afternoon what new PO was assigned and if there's some compelling argument.
ReplyDeleteHelpful note from my broker: "Stock market will be closed in observance of Martin Luther King Holiday."
ReplyDeleteNOK - Sheesh, if I'd held onto NOK I'd have made out like a bandit.
ReplyDeleteI spent a little time looking at the move in the market over the past 3 years, 10 months to see if there are any similarities between the rallies and subsequent pullbacks. The only real similarity I could find is each rally had an initial correction of 8 to 9% before a bigger correction occurred and the length of time of the initial correction was almost identical. Other than that, a trend I've noticed is the rallies off of each low have gotten smaller and smaller.
ReplyDelete2010: Correction from 1/11/10 to 2/5/10 was 9% and it took 80 days until the top happened on 4/26/10. The "initial correction" was 27 days.
2011: Correction from 2/18/11 to 3/17/11 was 8% and it took 46 days until the top happened on 5/2/11. The "initial correction" was 25 days.
2012**: The initial correction from 10/17/12 to 11/15/12 was 9% and has been 66 days since the top happened. The "initial correction" was 29 days.
Based on these similarities it does seem like we're getting close to a top if the pullback in Nov is the "initial correction". I still believe we're within days to a week or two of a top. Each one of the prior tops consisted of a big reversal day followed by a rally to test prior highs; however, each of these retest rallies had significantly weaker RSI_EMA's (i.e., relative strength readings). This is the best way to choose a spot to short in my opinion. Wait for the reversal day and then a subsequent rally on weaker strength to test to old highs. It's good to start shorting on this subsequent rally since you have an obvious stop out point: if you give it 1 to 2% above the old highs you should be able to provide yourself with a low risk entry.
Right now I'm about 50% short which is dumb bc again its wiser to wait for that initial reversal day sign that a pullback is coming within the next few weeks.
Really the best way to identify a good time to short the market is to pay attention to the relative strength readings. Typically when there is a significant top made in the relative strength reading and then a subsequent pullback and then a rally to new highs if the RSI readings are lower it does suggest that the market is losing its strength and susceptible to pullbacks.
ReplyDeleteGood presentation on turnaround investing...this company is high up on JMBA.
ReplyDeletehttp://www.marketfolly.com/2012/10/lloyd-khaners-presentation-on-jamba.html
oil actually looks ready to run here soon if the market continues higher. if this happens let's keep in mind what performed well in early 2011:
ReplyDeletehttp://www.bespokeinvest.com/thinkbig/2011/2/1/best-and-worst-performing-stocks-of-2011.html