Friday, January 4, 2013
1/4/2013 Friday Reversal
Any pullbacks in gold/silver should be bought. Inflation is a product of the monetary velocity and the size of the monetary base. If the economy starts improving, then interest rates will start rising, which will greatly increase the monetary velocity (it can rise very quickly, as the history shows), and hence will lead to a very large inflation, considering the huge monetary base created by the Fed. Gold cannot go anywhere but up.
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Thanks David.
ReplyDeleteAUMN was pulled down at the close from $4.64 to $4.59 on a volume of 200 shares -- what kind of BS is that???
ReplyDeleteDavid- You have the shares wrong. I easily see 15K in the 4.60/4.59 range right at the close.
DeleteYes, Google had updated its volume info way after the close. It still has the volume data wrong on the long-term charts. For example, the 6-month chart suggests that there was a huge increase in volume in November, but Yahoo finance does not confirm that...
DeleteI missed it...was there a jobs report today?
ReplyDeleteYep.
Deletehttp://www.bloomberg.com/news/2013-01-04/u-s-stock-futures-are-little-changed-before-jobs-report.html
CP peaberries.....
ReplyDeleteCoffee is a berry with an outer pulp covering that is a source of carbohydrates for the growing endosperm (bean). See this diagram: http://www.sweetmarias.com/defects_seedstructure/defects_seedstructure-Pages/Image1.html
The outer layers of skin, pulp, parchment and in some cases the silverskin (depending on how the coffee is processed) are removed and the endosperm (bean) is dried on raised racks or directly on the ground in dry or sunny locations. Areas with plentiful water use a wet process to remove the skin, pulp, parchment and silverskin and areas with little or no water use a dry process that leaves more silverskin which comes off as 'chaff' as the bean expands while roasting.
As you can see from the diagram, the typical bean has two sides or halves. In some cultivars the bean develops only one side which is thought to be more intensely flavored. These one sided beans are smaller and known as peaberries. Many coffees are screened for size and to remove contaminants like small stones and the peaberries are screened out in this process or they are hand selected. There are some processors that hand select all beans and these tend to be very high quality. The most well known is La Minita in Costa Rica.
My best guess is we top out within 4 to 7 trading days at around 1,520. We then nose dive for two weeks to 1,370 and the selloff is over.
ReplyDeletePreviously I thought 1,300 would be the downside to put in a higher low above the June lows. However, I think the higher lows above the Nov lows will be the most obviously resting spot. I'm considering the possibility of buying TZA if we should get to 1,520 and RSI_EMA hits 80.
DeleteSold half of my DSX that I bought in Sep. Moved my stop on the remaining half to breakeven. I bot these shares on Sep 19th. I'm looking at the daily chart and I have no idea now why I bought them now. I used my Landry stop loss and first sell target rules but there's no way this would have been a TKO trade. I'm just glad I had my sell and stop loss orders set up as good till cancelled.
ReplyDeleteSo far I've bought 3 of Landry's book to give to family members and a friend plus I loaned out my book. I told them the one technique Landry teaches in the book, using the 10 20 30 MA to watch and trade TKO's, is simple but it's a really good place to start. The biggest problem I have with Landry's method is waiting for the proper setups. What I have found most helpful in his book is how to set stops, at least the initial stops.
I have part of my account allocated to trading TKO's and now I'm working on applying Jesse's strategy.
You just have to scan more charts for set-ups.
DeleteI found going to Bulkowski's chart page and going to the first five sectors by RSI and then scanning all of those charts was a good way to find them if you don't have telechart and the scans Dave uses.
I agree and I may do that. I used to check his BLOG daily to see his targets for the S&P. I seldom get the chance to daytrade but I do like his once a week comment one of the indexes where he uses a 5 min chart.
DeleteHere's what I'm doing at the moment to try to follow Jesse's strategy.
ReplyDeleteI start with stochchart's strong volume gainer screen and I narrow it down to stocks trading between $2.00 - $17.00. I put all of these into a chartlist using the following settings, weekly, 10 WMA, volume, and MACD. If the chart looks good then I look at the financials in morningstar.
I'm sure what I'll be doing in 6 months will be different but I needed to start somewhere. Morningstar seems to have a lot of good data you can use to create screens. I'm guessing that as time goes on I'll probably start using morningstar screens first to come up with a list and then dump those in stockcharts. We'll see.
I did my first purchase under this method today. I bought EGHT. It came up on a stockchart screen and I like the numbers on the income and cash flow statements.
oh yeah Gig 'em AGGIES! We wouldn't have a team at all without Manziel.
ReplyDeleteCouple of companies you guys might be interested in:
ReplyDeleteMNTX
RNET
By the way, Jesse mentioned to me and it reminded me of what I saw a little while ago about SNE: they had a convertible bond that was issued back in Nov with a conversion price of $12ish (actually 957 yen) that increases shs outstanding 15%. That's a hefty convertible and I believe with the falling yen it might be convertible right now. That's probably why the stock dropped today because of the falling yen having an impact on the conversion price. ST this is going to be a weight on the stock and could cap the upside. Ultimately I don't think it really matters just because I think the valuation is so cheap relative to peers that it doesn't change things and I think sentiment is so negative that it still sets up for a good trade. But it could slow the upward move and is something to consider, especially if it causes investors to think more convertibles might come along.
You're right, Craig. We need to subject all total pricks to circumcision without anesthesia in order to make them more empathetic.
ReplyDeleteCan we choose a few to cut deeper? I can think of some that need a full excision or perhaps skip right to lobotomy.
DeleteIt's not possible to lobotomize a puppet.
DeleteIt depends. These assholes are more like Chucky. More like possessed ventriloquist dummies than puppets, but I get your point, they don't think on their own, they just mouth the dialogue of however has their hand up their ass. Which may explain why they so easily fall into sex, hooker, drug and drunk driving scandals. More or less proof if we cut their dicks (or even foreskin) off, what little brain they have will be gone.
DeleteSo we're speculating that the high-volume sell off on SNE was due in part to the existence of convertible bonds. Should the stock price continue to rise, any future bonds would be offered at successively higher prices. I think it's a decent strategy for raising money.
ReplyDeleteI missed an additional gain in UGAZ by selling out on Thursday. What's the counter-argument? I locked in a much smaller gain, and there's no way to know which way prices would have moved.
ReplyDeleteCoffee - Well, I still say they're not beans, they're peas.... Cuba has it correct.
ReplyDeleteNope. http://www.differencebetween.net/object/comparisons-of-food-items/difference-between-peas-and-beans/
DeleteCoffee doesn't have a hollow stem, is shaped more like beans and is not a legume.
"Beans also include the palatable seeds and pods of herbs. Similarly, the seeds of other non-Leguminosae shrubs or trees, as in the case of coffee and cocoa, which are still considered beans because they both resemble ordinary beans."
"Summary:
1.Peas are characterized by their hollow stems while beans possess more solid stems.
2.In general, beans lack tendrils as compared to peas that use their leaf tendrils to twine.
3.Peas are treated as vegetables in the realm of cooking even if they are ordinarily fruits.
4.With regard to cotyledon development, beans have their cotyledons emerging from the ground unlike in the case of peas."
Unlike beans or peas, coffee grows on a shrub, not a vine and has one seed per fruit, where most beans and peas have pods with multiple seeds.
AUMN - Looks like ~15k shares were traded in the last 5 minutes:
ReplyDeletehttp://elite.finviz.com/chart.ashx?t=aumn&ty=c&ta=0&p=i3&s=l&rev=1327525242420
On the weekly chart, YCS seems like it is currently more extended beyond its 10 WMA than at any time over the last 3 years.
ReplyDeleteyep due for a pullback for sure.
DeleteANR and ACI both just look like buy and hold stocks.
ReplyDeleteAnyone buying IRE?
DeleteANR, I looked back at my log and I stopped trading this in the 20's. Hard to think it got as low as it did. I agree with what you say about both, just buy and do not look at for five years. I did that with BRKB at around 19 and still have it.
DeleteI sold IRE on this move up much too early, probably qualifies with the coals concept.
Business Insider has a really good set of charts from JP Morgan and definitely worth a look through: http://www.businessinsider.com/jp-morgan-funds-guide-to-the-markets-2013-1
ReplyDeleteWhat was really surprising is how normal things actually are given the hype you are bombarded with in the press.
Whats up ladies? Good weekend here. Lot of traveling the next 3 weekends so layed low which was nice.
ReplyDeleteSequenom Announces Preliminary 2012 Operational Highlights
ReplyDeleteSAN DIEGO, Jan. 6, 2013 /PRNewswire/ -- Sequenom, Inc. (NASDAQ: SQNM), a life sciences company providing innovative diagnostic testing and genetic analysis solutions, today announced preliminary highlights of the Company's 2012 performance and accomplishments.
Initial 2012 Performance Results (unaudited)
Total revenue of approximately $89 million, growth of approximately 59 percent year-over-year for 2012
Diagnostic services revenues of approximately $46 million, compared to $8.3 million in 2011. Diagnostic services revenues continue to be recorded primarily as cash is received
Sales in the Genetic Analysis business of approximately $43 million
More than 92,000 total prenatal and retinal diagnostic tests accessioned during the year
Strong increases in the adoption rate and sales of Sequenom Center for Molecular Medicine's (Sequenom CMM) MaterniT21 PLUS lab-developed test (LDT):
More than 60,000 MaterniT21 PLUS tests accessioned in 2012
An annualized run rate of more than 120,000 MaterniT21 PLUS tests accessioned at the end of 2012
Approximately 56 million lives under coverage with growing number of payor contracts
Continued reimbursement as an out-of-network laboratory from large commercial payors
Total cash, cash equivalents, and marketable securities as of December 31, 2012 were approximately $176 million
Cash burn of approximately $17 million for the fourth quarter of 2012
Sunday press release is strange.
DeleteTrying to slip some bad news past the market?
DeleteI've seen positive news announced Sunday evenings quite a few times, wonder if there are any statistics.......
DeleteSo far in this case shorts are in control though.
Objectivetrader has opened up his site for a while if you want to get an update on his thinking.
ReplyDeleteDavid, you'd probably like these charts: http://www.objectivetrader.com/2013/01/gold-hammer-.html
DeleteThere is much discussion in Japan about the newly installed government restarting the NUCLEAR ENERGY sector. After the horrible effects of the TSUNAMI, Japan moved to shut down its nuclear power sector out of fear of another major disaster. However, with Prime Minister ABE‘s effort to weaken the YEN, the cost of imported fossil fuels will drive Japan’s cost of imported OIL much higher so ABE knows that the Japanese will have to return to nuclear power. This is as much a currency issue as a power-generating argument. The weaker the YEN the higher the cost of OIL. If ABE wants to make the Japanese industrial more globally competitive then the renuclearization of the Japanese economy will be a main part of the ABE policy. The more nuclear power plants that are returned to usage the greater possibility for continued weakness in the YEN. Just another variable to watch in relation to the currency markets.
ReplyDeletePer Yra Harris
Yeah, Yra makes an excellent point. I'd really be surprised if Japan does restart their existing reactors, maybe some kind of new replacement (mini?) reactors incorporating inherently safe technology, is the solution?
DeleteGram Positive - Someone has released some sort of new report for sale on Gram Positive market research, here's the link:
ReplyDeletehttp://www.researchandmarkets.com/research/f4xq6s/grampositive
I'm guessing you didn't buy it?
DeleteNo, I haven't read the offering yet or even seen the price. Don't see where NSPH is listed, either.
DeleteJust passing on any info as it crosses my radar.....
Looks like this report pertains primarily to therapeutic solutions, not necessarily detection.
DeleteYeah, I scanned it quickly. I wonder if those things make much money. If it covers all the potential drug co. listed it's got to be quite expensive, or just a bunch of crap copied of the internet.
DeleteSQNM- Nice reversal. Too many moving parts for me to quickly follow.
It kinda sounds like a bunch of crap copied off the internet assembled into what they no doubt have priced higher than I'm willing to pay.
DeleteSQNM - The gap up still needs to close, anchor harbor.
DeleteUp or down?
ReplyDeleteWell, not every day can be an up day in the market, right? The exceptions to this are NSPH and SQNM, of course. ;)
Oh, BAC also, something about getting their tit out of the current ringer for the price of a song and a dance in comparison to the damage done.
The interesting tidbit I noted yesterday was El-Erian advised running for cover into safe assets, and since I cannot recall him ever being correct then I guess this means rates are set to move higher.
SVM - Every day can be a down day for this one.
ReplyDeleteCUBA - I'm not advocating this ETF, but that guy Herzfeld is well thought of in some social circles I consider trustworthy.
ReplyDeleteThe ETF PPS isn't controlled by him, and he's been waiting many moons for the trade embargo to be lifted.
Coffee - CC - Okay, thanks for clarifying the reasons why coffee isn't a pea.
ReplyDeleteI'm going with berry, instead.
To have a balanced diet I need to count it as a vegetable.
DeleteYes, the perfect snack vegetable alternative in the case you're burned out on dried peas try roasted coffee berries.
DeleteBeats beer nuts (the other tuber vegetable).
Or chocolate covered for a little pick me up.
DeleteI hear beer nuts are highly nutritious.
Finally a square meal for everyone, available in white and dark!
DeleteFortified with vitamin "E", incentive for couch potatoes.
Z has quietly moved into it's gap.
ReplyDeleteUp 15% in 2 days.
DeleteAA - Earnings tomorrow after close, huh?
ReplyDeletehttp://www.bloomberg.com/news/2013-01-07/bernanke-strikes-first-yen-blow-as-yield-gap-rises-japan-credit.html
ReplyDeleteIn the very short term, the Yen was bound to take a pause and recharge for a further drop. I see the Yen moving to well over 100 especially if Abe and team really put the pressure on it. I envision a Volcker like strategy with regards to deflation in Japan. There is no way that exporters won't benefit from this. SNE has short term issues with the convertible bond that is only applicable to traders keying in on resistance levels. However, the disparity between the current market price and the sum of its assets is so large that over time the price has to go up.
Delete"The ideal yen level would be 90 to 100 yen per dollar"
DeleteMore talk of parity, embedded in this message.
the key takeaway:
Delete"No domestic company can generate a profit by making goods at such a disparity between costs and prices, Ryoji Musha, president of Musha Research Co. in Tokyo, wrote in a research note on Jan. 4 about purchasing power and nominal yen rates."
No way the Japanese government isn't keenly aware of this issue. I firmly believe this is the trade of the year/next couple of years.
By this i mean long anything in Japan
DeleteBOJ should print shiploads of Yen, give it to Corporate Japan with certain strings attached, and tell them to go out and but up all the natural resources they can get their hands on.
DeleteBC - This thing really jumped when folks realized $650M was headed for the boating industry following the hurricane Sandy.
ReplyDeleteI remember when that was trading at $2. wow
DeleteJust read the articles from Objectivetrader and I agree with most of them. Man that guy has it out for Tim Knight over at Slopeofhope. Funny stuff.
ReplyDeleteI do agree that we're going to see 1,500 first before a drop...it just seems inevitable. and the 1,440 area (i.e., highs from mid Dec) seems like a logical pullback/resting point before we go higher.
Ultimately we're probably going to see all time highs in the market soon enough. The currency wars that are going on, however, will probably result in a casualty unforeseen that will shock the markets. Perhaps the Yen crashes and causes panic in China? A repeat of the late 90's fiasco? That seems like a likely scenario that not a ton of people are talking about.
My belief all along is that we will see new highs in the markets but we still have one more 25% drop coming. I think the late 70's / early 80's analogy holds and I would use that as a rough gauge for how the markets will trade. While valuations are currently cheap they could definitely get cheaper and result in a good spot for a longer term sustainable bull market. All we're seeing right now is large gyrations in the context of higher highs and higher lows. It presents unbelievable trading opportunities if you just pay attention to relative strength ratios of the overall market:
Deletehttp://stockcharts.com/h-sc/ui?s=$SPX&p=W&b=5&g=0&id=p71819241451
I think the technicals back this logic. We are pre-earnings and the top of a V shaped recovery at high levels...as Big Dave notes. We can even make now highs but that usually triggers profit taking from a psychological pov.
DeleteHis stuff does make sense - I assume he charges for this on a normal basis, but haven't really looked into it.
DeleteLong UGAZ $19.77
ReplyDeleteAdded at $19.6.
DeleteMLNX - Wow, this one's still on a tear....... pfffffftttt!
ReplyDeleteInteresting stats from Sentiment Trader via Raymond James on how the market does after 2 back to back 90% upside days like we had last week at https://raymondjames.bluematrix.com/docs/pdf/e3965104-7510-40b6-8cbc-6ea0c05a9bcf.pdf
ReplyDeleteVery positive for the market.
Agree, I think it's unwise to sell but I would welcome a brief pullback on which to add.
DeleteIMAX - Nice move, is this one gonna shoot up now?
CSTR - CEO announces retirement - Uh, oh......
ReplyDelete"BOJ should print shiploads of Yen, give it to Corporate Japan with certain strings attached, and tell them to go out and but up all the natural resources they can get their hands on."
ReplyDeleteCP - In their stimulus proposal there is a good deal of money earmarked for loans to corporations at cheap rates. SNE was marked with junk status recently. I'm sure that they will get cheap financing from the govt regardless of what the bond ratings are. I'm pretty sure the government is doing that with this in mind.
Exactly, I figured they'd be doing something logical like that.
DeleteGMO back down to $4.10, I bet it doesn't fall back under $4 and I'll probably pick some up if it does.
Is The Low VIX A Warning? – Mid-day Friday, the very savvy Jason Goepfert of SentimenTrader sent a somewhat unusual
ReplyDeleteintra-day alert to subscribers. What caused the alert was the so-called "fear index", the VIX. Here's how Goepfert opened
the alert:
Whether it's the temporary removal of uncertainty about the fiscal cliff, beginning-of-year portfolio adjustments
or other factors, the VIX "fear gauge" has declined a record-setting amount over the past several sessions.
In more than 20 years, we'd never seen back-to-back daily declines of more than 18% that we did on Monday
and Wednesday, and once again today the VIX is dropping dramatically. It's currently more than 6% below
where it closed on Thursday.
Cashin’s Comments January 7, 2013
Page 3 of 3
ab
What's notable about this is that should we close where we are now, the VIX will be below the 14% level for
the first time in more than three months. That has not boded well for stocks in the shorter-term, since every
time we've seen that in the past, volatility has increased rapidly.
He notes that it's so infrequent (five prior occurrences) that seeing it as a pattern holds some risk. By my count, the close
fulfilled the pattern and, adding to the concern, the market is clearly overbought with the S&P trading above its Bollinger
band in the three day rally. Add in the lore of the three day calendar flow and attention must be paid. Via Cashin
http://www.cboe.com/micro/vix/pricecharts.aspx
Good ol' TVIX received it's reverse split just in the nick of time...
DeleteI see that AUMN is clawing back the losses it took on Friday at the close. In fact, it just made a new daily high at +2.6%, ignoring the fact that GDXJ is down 1% and SIL is down 1.7%. Very nice relative strength...
ReplyDeleteSure seems like the market is beginning to anticipate increasing revenue. So many times though AUMN does well on the first down day of PM's only to make up the difference during the next few.
DeleteAt some point the revenue increase is gonna haveta make a positive difference?
Maybe even PAL can pull the same stunt, remember when nobody wanted TC???
Okay need to refill my car, so where's my $0.05/gal gasoline?
ReplyDeleteSOLD! UGAZ out at $20.2.
ReplyDeleteCome on chickenshatz, sell your stocks!!!!!!!
ReplyDelete2nd - Whatever happened to this guys, did he run into some hippies and lose his way up there 5000ft in the SC mountains?
ReplyDelete"Sure seems like the market is beginning to anticipate increasing revenue. So many times though AUMN does well on the first down day of PM's only to make up the difference during the next few."
ReplyDeleteThat's true. But looking at the GDXJ chart since Dec. 28, I still see a clear uptrend with higher lows. So GDXJ is starting to move higher despite GLD and SLV being flat since December 28. In fact, GLD and SLV have been flat since December 20th, suggesting that there is a strong support for them at the current level, which is unlikely to be broken. Putting all of that together, the next most likely move in the PM sector is UP for SLV/GLD and for GDXJ.
Did you see the PM call Bill made in his WIR?
ReplyDelete*****
Despite the recent pull-backs, I have stated clearly in these pages: “I continue to believe that within a few months $GOLD will surge to $1900 (back to the highs of August 2011) and then after a period of consolidation up to $2300. In about a year [4Q2013], I believe $GOLD will be in the $2700-$3000 range.” … “I’d say many of you are hopeful, but most of you don’t believe it will happen.”
Every dip has been an opportunity to buy Silver bullion, as I see it. After now falling so much in recent weeks, I still believe that within one year Silver bullion will be $125/oz. Call it a great hedge to the Global QE I think is on the horizon.
*****
I wonder how he is going to fudge his way out of this call one year from now... :)
It's a global conspiracy.
Delete...or he's drunk again.
DeleteMaybe the new mini reactors for Japan will require tons and tons of silver, or it's about to take another major dive just like the last time such bullish sentiment was expressed?
DeleteOr, maybe he drinks a lot of vodka named "Silver Bullion"?
DeleteNice UGAZ trade bro!
ReplyDeleteThanks for the post, T3d. Opened a small position in VXX @ 27.41...
ReplyDeleteGood luck, 2nd.
DeleteFrom WAY back in the blog...I freaking love Beer Nuts. A staple on any respectable road trip.
ReplyDeleteSurviving a dance with UGAZ always a reason to celebrate.
ReplyDeleteIt's unlike the miners to close near the lows of the day. I don't think it bodes well for Tuesday.
ReplyDeleteWhich miners are you talking about? My main risk indicator, GDXJ, closed near the highs of the day...
DeleteNIHD, looks like it could be a cup and handle.
ReplyDeleteLong 6.81
wow nice chart. what's the catalyst?
Deletebeer nuts...mmmm...the original sweet and salty snack
If it gets to 7.33.
DeleteIt closed weak today and the market is funky at high levels.
Not a good time to go big long.
TOF, I just look at charts and take my best shot. Jesse mentioned this and I have been monitoring it for an entry.
DeleteObservation: broke out of a small base in mid DEC on expanded vol and may be consolidating before making it next leg up, also filled the gap from NOV. Seems to be alot of resistance at the 7.5 to 8.25-.50 level.
That's what I see.
Looks like a lot of trading between 7.50 and 8.50 but if it breaks above that overhead it can run uninhibited to 10.89 or so. That would be a decent trade on it's own, but it looks like it has the potential to double from there historically. I would want it to give a me a good reversal signal, but that's just me. Good luck!
DeleteI guess that's your order @ 16:00. Love the chart will take a look.
DeleteYep, see AMX as well. Some have posited that lifting the Cuban embargo will help these lift, specifically mentioned was AMX.
DeleteI'm no expert though, of course.
VIX:
ReplyDeletehttp://macromon.wordpress.com/2013/01/05/vix-has-largest-weekly-down-move-since-inception/
VXX- RSI has room, but MF is buried.
ReplyDelete