Thursday, June 6, 2013
06/06/13 Emerging Markets for a Base Hit
The pitch looks good. The DJIA did indeed hit 14,844 this morning and is now turning green. Emerging markets are down -10% YTD (-7% just in the past month) and due for a bounce. Long EEM @ 40.67, and will go long RYWVX (Rydex Emerging Markets 2x) at the close. One advantage of this particular leveraged fund is the ability to close at 1030 am or 345 pm each day- I would be able to capitalize on any overnight rally in the global indexes by 730 am PST the following day.
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ECA long on close
ReplyDeleteNSA - Trust me, rectal exams are far from free and you and I are lowest the hanging fruit.
ReplyDeleteVZ - Call and ask them why half of the bill falls under the heading of taxes, these are actually "taxes" collected for the purpose of line maintenance and upgrades, which the phone companies themselves manage.
Don't care CP, just would have like to have made that 1000 bucks on the trade. LOL :)
DeleteNod, me too PZ, me too.....
DeleteDAMN CC had to bring in some article for me to ponder and ruined the whole thing.....doesn't he know I trade on feel. LOL
DeleteFolks, you would be surprised, but the declining upper trendline on S&P futures leaves very little upside from here, maybe 0.5% at most:
ReplyDeletehttp://www.finviz.com/futures_charts.ashx?t=ES&p=h1
Stock picker's market, David!
Delete+13.66 points on S&P! My oh my, how blessed we are with today's gift.
ReplyDeleteIn case any of you picked up RYWVX, I clarified the 1030 am close with a Fidelity rep:
ReplyDeleteRep: You are correct - if you request to sell this fund at 9 a.m., Eastern Time (for example), the order would execute at 10:30 a.m., Eastern time.
Me: And it would hopefully execute at 'prevailing' prices, of course. Is there some reason Rydex fails to 'publish' a record of the 1030 am closing prices?
Rep: We can research 10:30 closing prices going back to 2011 - however, it may be easiest for you to obtain morning closing prices from the Rydex Web site directly. According to my Back Office, morning prices started December 2, 2010. We can provide specific prices for specific dates, upon request.
Me: Ha! OK, I'll do that. Do you happen to have this morning's 1030 am price in front of you?
Rep: Yes, I do - this morning's closing price was $13.22. And orders that fill in the morning will be posted to your account before 2:30 p.m., Eastern Time.
That's nearly as lucrative as those 20min delayed quotes, always a desirable feature.
DeleteKOL - + $0.01, notice that? Nice gift, huh?
ReplyDeleteAdded a bunch of FMD today at $1.20 and $1.21. Now my largest position by far.
ReplyDeleteAvg is probably around $1.23 on all accounts.
DeleteI thought you weren't convinced this was gonna move for year or so.
DeleteI guess I'll have to break down and add as well, do my part in getting those computers unlocked.
DeleteMy computer froze up the last 10 minutes today and I was paralyzed. Got a new Dell LAttitude waiting for me at home. Seems mine last about 3 years before they start to hinder my trading.
DeleteI had bids on CECO, FMD, and CHSCP today that didnt fill.
Doubled my EGLE at 4.16. Will trade that half a little more aggressive.
PZ - I keep coming back to what the CEO said about the student loan market and FMD's chart coincides with what might be a big move coming up...
Delete"We believe that the private student loan asset-backed securities markets appears healthier now than at any point since 2007. In both primary and secondary markets, bonds are being placed and traded with increased certainty. In our last call, we discussed 2 of the key metrics which determined the economics of a securitization, funding costs and a required capital.
Funding cost have continued to improve due to both the growth of the investor base, as well as the quality of the collateral being financed in the market today. From the capital side, this quarter saw an important development as the benchmark issuer placed a new single-lay rated subordinate bond, the first such bond in the private student loan space since 2008. The market responded extremely favorably as significant investor oversubscription allowed the bond to price well inside initial guidance. The result was in a lower all-in cost of funds for the benchmark issuer compared to its prior transaction in October 2012, which did not include a subordinated bond. The inclusion of the subordinated bond increased the amount of funds raised as a percentage of student loans financed from 78% to 84%, reducing the capital requirement of the issuer. As we have stated in the past, the return of the subordinated bond market is a linchpin for market accessibility and that this transaction signals the continuing normalization of the private student loan ABS market. We will monitor developments in the capital markets relative to our other funding sources, remaining opportunistic in the use of the company's equity capital."
FYI - For EGLE I'm just looking at the chart on this...stop out on close below $3.85.
Delete"We believe that the private student loan asset-backed securities markets appears healthier now than at any point since 2007."
DeleteDidn't Congress make some major change to the student loan market back in 2010, a change that sent the private market into a tailspin? I think this is what prompted so many banks to leave the market?
Yep.
Delete"During the financial crisis, private lenders couldn’t raise money to issue new loans, leaving some students in the lurch and prompting the government to increase its lending directly to students. At the same time, lawmakers were questioning the wisdom of the government’s previous subsidy to private lenders that indulged in some less-than-savory business practices. In 2010, the U.S. government ended the guarantee program altogether and began exclusively making loans directly to students, offering lower rates and better borrower protections. Private lenders could still make loans, but they had do so without public support. That’s just what Sallie Mae Bank, one of the new companies, plans to do. Sallie Mae already makes private loans that focus on more creditworthy borrowers, such as those with parental co-signers. It also want to use its relationship with students to offer traditional banking products such as savings accounts. It hopes to boost its current $7.8 billion in bank deposits."
http://www.businessweek.com/articles/2013-05-29/why-sallie-maes-splitting-in-two
Sallie Mae (SLM) is splitting up to free up capital for expanding the private sector biz. It's an expanding market b/c the demand is so high for student loans.
Here's another one...
Delete"“The cost of education continues to increase at a pace that exceeds income and savings growth and the availability of federal funds does not significantly increase, we expect more students and families to borrow privately,” Sallie Mae notes in its most recent annual report."
http://www.forbes.com/sites/halahtouryalai/2013/05/29/what-sallie-maes-split-says-about-student-loans/
Maybe SLM will just buy out FMD?
DeleteThanks, I completely forgot where I read that stuff. ST memory for the birds, selective memory better than ever.
DeleteUGA - Back over the 50SMA, longs have the bull by the horns.
ReplyDeleteListening to CNBC all day to gauge sentiment...everyone wants to say they are getting out at or near the top. Bulls are becoming cautious. That's why this market continues to go higher. Negative sentiment.
ReplyDeleteInverted H&S for AAPL on daily chart.
ReplyDeleteThe Mermaid of my dreams, Esther Williams passed today......
ReplyDeleteTA - Back in the triangle AND inside the 50SMA
ReplyDeleteProbably goes sideways, at best. Why sideways? b/c I'm wasting my time watching.
VMW - Just noticed this one traded under $67 yesterday, too bad I wasn't watching!
ReplyDeleteNLY - this is the falling knife chart. Hmmmm. 13.09% divvy at $13.75.
ReplyDeletehttp://stockcharts.com/h-sc/ui?s=NLY&p=D&b=5&g=0&id=p50247247455
I still have some ARR portapie.
DeleteThat div can change, of course. Jesse warns to stay away from LQD, not sure if that can be extended to mREIT's, some of which are structured slightly different from others.
DeleteI still have my NLY, quickly sold the part added during the recent day of recogning to lower my basis (now $13.82).
Added to GMO yesterday and today. 2.06/2.02 ish. Now have about 37K shares. The catalyst is out there. Not my style to add this late, but I like the way it's trading.
ReplyDeleteVMW- I wonder how much rev. it's missing now that AAPL is allowing more MSFT programs to run on it's OS.
First of all, it's a huge leap of faith to claim MSFT programs actually run as intended.
DeleteThis is where we will be staying next weekend. Margaritas on me pool side for anyone able to stop by!
ReplyDeletehttp://www.jdvhotels.com/hotels/california/central-coast-hotels/santa-cruz-dream-inn
You're buying, beatch! ;)
Delete"Raymond James downgraded Alpha Natural Resources (NYSE: ANR) from Outperform to Underperform."
ReplyDeleteThey skipped a step.
Maybe RJ is calling the bottom here?
DeleteFrom BACML, ANR is underperform 12mo PO is $7 CNX PO is buy $36 these are subject to change, of course:
Delete"US Coal: Q3 met benchmark pegged at ~$150; Tough for U.S. exports
6/7/2013 1:04 AM
We summarize our call with Platts on market conditions for metallurgical coal and iron ore, with some cautious conclusions for coal pricing near term. We remain cautious on US coal names, except CNX."
SVM - FD: I tried buying weakness when SVM was trading at $9, that didn't work too well and I stopped losing on the trade when I finally sold at $7.
ReplyDeleteMaybe buying weakness here is the right move, I don't know.
Got Random Thoughts?
ReplyDeleteThe Ps dipped below the 50-day moving average but reversed to close well and nicely in the plus column. There’s nothing magical about “da fidy” but it can help to keep you on the right side of the market. See Thursday’s (06/06/13) chart show.
The broad based Rusty closed up over 1%. This was indicative of what happened internally. Most stocks and sectors had a decent day.
I suppose the $64,000 question is: Is this just a bounce form oversold or is the longer-term uptrend resuming. Well, I’m going to tell you something that no guru ever would: I dunno.
I do like to err on the side of the longer-term trend until proven otherwise. And, so far—again nothing magical—da fidy has held.
It’s the market’s job to fake out and shake out as many players as possible. See yesterday’s column (06/06/13).
So what do we do? It’s good to see the market bouncing. Again though, we don’t know if it is just that or if it is resuming its longer-term trend. So if you don’t know, how can you trade? Simple: Wait for entries on new longs. If the market rolls back over, that in and of itself might keep you out of new trouble. Honor your stops on existing longs. That will take you out of the market if the slide turns into something bigger. Keep an eye out for a short or two. I’m okay with being triggered and stopped out of a short if the market resumes its longer-term trend. I lose a little on the short and make a lot more on the longs. Of course, if the market does roll over, I get stopped out of my longs and begin to participate on the down move. This is a long winded way of saying let the ebb and flow of money and position management help to keep you on the right side of the market. It is not difficult. Notice I said “not difficult” and not easy.
Futures are strong pre-market.
Best of luck with your trading today!
OSH- That one had a nice 2 day pull back the other day.
ReplyDeleteLooks like C&H to me. I thought Sears or someone bought OSH?
DeleteI have a hard time believing the OSH of yesteryear would be losing money.
DeleteNotice how at exactly 721 am pst (nine minutes prior to the 730 am pst cutoff for RYWVX), EEM is trading at the same exact price it hit at 1245 pm pst yesterday. So traders looking at the early selloff in EEM and thinking they had a slick shot at picking up Emerging Markets at lower prices via RYWVX this morning have been neatly frustrated by the Market.
ReplyDeleteGREK is up 2%....
DeleteECA out at .67
ReplyDeleteMain computer overheating, on life support system.
Over and out
Nothing working in my port today, plus couldn't buy my MF's back yesterday due to the shitty computer issue. Frustrating day thus far.
ReplyDeleteon top of that my new PC wont link to my big screen monitor through the KVM (keyboard/video/mouse) cable. No idea how to fix that. IS it 5 o clock somewhere? :)
DeleteMight need a driver install? Same operating system? What is KVM format, USB or most likely something else? Aftermarket or OEM, drivers can be downloaded if not ancient?
Deleteplugged it into another port...drivers installed...functioning now
DeleteTXT - Coulda had this one under $26, so much for buying panic attacks....
ReplyDeleteRedf came back to life a bit. Pop to 2.80
ReplyDeleteOSH - Load up under $3.50? Something changed with OSH a few years back and I don't recall what it was, could be failing assets were purposefully dumped on shareholders?
ReplyDeleteGSJK - Could be a decent entry here.
ReplyDeletemREIT's - So if the real estate industry(IYR) does continue improving, that should mean the MBS valuations should at least hold their value. Add to that, higher rates on the long end, and mREIT's should be able to capture the greater spread while their book values hold up.
ReplyDeleteTemper these observations with a train of logic that thought QE3 was positive for PM's and you've gone full circle.
You mean IF IYR stops crashing, right? The chart is a disaster.
DeleteIt could stop, which would be good, but it's butt fugly right now.
At this price you do have something to trade against though. Clearly defined setup.
DeleteGreat point CC, a much better choice of words would've been "IF RE resumes improving"!
DeleteVery well could be several Q's of pain in store for mREIT BV's considering the recent MBS swoon, probable lack of income due to prepayments (most likely spiking now, since rates are heading higher) and improved income in the sense spreads are widening.
Management's ability to maneuver the portfolio and time the market is being tested, plenty of flux!
Street Authority, Forbes, MF are all pumping the REIT's today, LOL!
DeleteI'll be looking to add EGLE on panic today to get to a full position (i.e., 20%). I'm targeting $3.9 for the final piece with a stop below $3.80.
ReplyDeleteOn my board I'm noticing more strength in overseas stocks than anything else.
FMD - Stink bid at $1.07 b/c computers always receive the good news first.
ReplyDeletePAL - Halted on news?
ReplyDeleteThis ticker stands for "Profits Are Lacking".
DeleteEEM>
ReplyDelete(a) I sold most of my positions around 40.90 this morning.
(b) Unfortunately, there isn't much I can do about RYWVX, which is a leveraged 2x fund with 48% exposure to Latin America. And Brazil is crashing to new 52-wk lows.
In other words, I could have picked almost any sector (for instance, I thought about Japan, which is up almost 4% today) and done better. My only consolation is I'm not holding miners.
FMD last 2 weeks:
ReplyDeleteUp
Up
Down
Up
Down
Up
Down
Down
Up
Down
Net total: Up 3 pennies. What a thrill.
Straight from ZZZZzzzzzzzz to headrush in 5,4,3,2,1,0,-1,-2,-3,-4,-5,-6,-7...... LOL
Deletehttp://www.bloomberg.com/quote/BDIY:IND/chart
ReplyDeleteClick on the 3 year chart. What are the odds this can get above 1157 (peaks from 2012)? Closed at 812 today. Are the dry bulk shippers sniffing this move out? DSX and NM, the leaders in that space, have both gone above their 2012 highs this year. This is part of why EGLE intrigues me. If you read the CEO's comments on the last conf call they talk of a coming rapid drop in supply of ships.
We shall see.
I might be sniffing glue too, but there could be a channel in this commodities chart:
Deletehttp://www.crbtrader.com/data.asp?page=chart&sym=BVY00&name=BLS%20Raw%20Industrials&domain=crb&display_ice=1&cancelstudy=&type=LINE&studies=SMA%2813%29;&a=W
BAP chart might signal a clue as well, perhaps?
DeleteGGB - The nearer your destination, the more you keep slip sliding away.....
ReplyDeleteGood report over at thestreet.com. Especially the chart on page 6. Think it has a good read on the current markets from a longer term perspective:
ReplyDeletehttp://www.thestreet.com/tsc/common/images/pdf/20130603TheRearViewMirror.pdf
Today, the preponderance of portfolios is conservatively structured, both in equity exposure and
stock selection. If they remain invested in high yielding, slo-no growth companies, they will
find themselves caught in “value traps.” Continued frustration from persistent underperformance
will necessitate methodically moving into a faster lane.
Against this backdrop, the transition from the current value/yield leadership to growth
stocksis just around the bend. From bond-substitute, income-oriented equities, investors will,
with caution, embrace growth at a reasonable price (GARP) and price earnings to growth rate
(PEG) strategies. They will seek investments with predictable growth prospects and
conservative valuations.
Anyone have good people to follow on twitter?
ReplyDeleteHere is my list of most useful ones. I've got about 35 in total. My address is @bbarberayr, but I tweet rarely.
@PeterLBrandt - commodities
@calculatedrisk
@SteinbergWealth - Canadian value investing
@davidpbaskin - Canadian large caps
@LSigurd - very successful investor with good detailed writeups
@michaelsantoli
@EddyElfenbein
@timmelvin - value investing, hotels
@CapitalObserver - hedge fund manager
@abnormalreturns
@hmeisler
@TickerSense
@sentimentrader
@DougKass
@bespokeinvest
I follow Ryan Detrick over at Schaeffers and Ralph Acampora.
DeleteF*ck it I bailed on EGLE
ReplyDeleteI thought I would add one more third at 4.06 at market close with my stop set at 3.85 for protection. Anyway, entered the order as market(my bad) and it executed 7 seconds after close (401k port) at 4.30. ....WTF? On the phone right now. F'ers. About a 300$ oops.
DeleteA. It should not have executed after hours in this account.
B. The bid ask was 4.06 4.08
C. The days whole range was no higher than 4.23
Guessing I will be told since you are small ball.....tough shit
Put me hold......subsequently hung up on me. SHEEZ not my day.
DeleteI see I did get a partial fill on some REDF that made a dime today.
Pz - I'm thinking this one is a gap filler. Just couldn't catch a bid at the bottom of the gap up day.
DeleteDid get some resolution.....they "dropped" the order for me. I am off the hook, but of course I dont get teh extra 1200 shares at 4.06ish I wanted. So for certain it will be up big Monday AM.
DeleteYou are probably right. Should have held out for the gap fill. I thought about this when I placed the first trade. Still has good upside potential I think. Either way the stop is set and I will follow through with the trade. Last couple weeks had been good to me. This week was a down week. It happens.
DeleteRYWVX off at the close. I'm hoping the last minute 'rally' in EEM means a decent closing price.
ReplyDeleteAdded to FMD today between $1.20 and $1.22.
ReplyDeleteMy bid at 1.19 didnt fill again.
DeleteAssuming a bull flag formation, our low bids should fill at some point but the lower trend line from Dec has held well.
DeleteNot knowing the criteria for securitization, I don't want to get in past my ankles in case a breakdown occurs.
FMD - Does today's candle qualify as a hammer?
ReplyDeleteSo many hammers on this thing over the couple of weeks...hard to tell if it matters. This chart cleans up the noise:
Deletehttp://stockcharts.com/h-sc/ui?s=FMD&p=W&b=5&g=0&id=p59486759309
Break above prior high in mid 2012, retested a little and bounced. Let's see if it can close above $1.30
OSH - Trounced at EOD, I guess that's the answer.
ReplyDeleteLOL, a reverse mortgage the lender opened at $300k, now valued at $150k.... Wonder how many of these are out there and how many withdrew the principal amount up front?
ReplyDeletePz - For EGLE, this is what I was thinking:
ReplyDeletehttp://stockcharts.com/h-sc/ui?s=EGLE&p=W&b=5&g=0&id=p61584582256
Buy around the moving average. Entry was poor. Should have expected a pullback there instead of using prior highs as a buy point. I think this is still in play and have cash set aside to buy...
Look at the monthly closes in REDF:
ReplyDeleteFeb: $2.7
Mar: $2.78
Apr: $2.75
May: $2.81
Close today $2.8
Not sure if this is a base or what. Most old high fliers have flown. This one is just sitting there. The recent quarterly report was decent in my opinion. Some small signs of optimism.
Look at the chart of MDY. Picture perfect bounce off prior highs.
ReplyDeleteI remember seeing several of these filings in YRCW where they surrendered a portion of their options and held the rest before the big run:
ReplyDeletehttp://www.sec.gov/Archives/edgar/data/1262279/000114036113024595/xslF345X03/doc1.xml
Maybe the same holds true here.
"Assuming a bull flag formation, our low bids should fill at some point but the lower trend line from Dec has held well.
ReplyDeleteNot knowing the criteria for securitization, I don't want to get in past my ankles in case a breakdown occurs."
CP - One thing that is really good about this industry is there is always a new supply of loans every year to be bid on because every year there is a new class of freshman coming to the market for loans. It's a huge and growing recurring revenue base to pick from. There is no way the government is going to service every single loan out there. Despite having a huge portion of their businesses in runoff mode, there's a reason why SLM and NNI have been good investments. I think the market has left FMD for dead, but in a few years I wouldn't be surprised to see this in the double digits.
Great points, there's probably a better than even chance no pullback occurs, just keeps on climbing. Wouldn't that be a hoot?
Deletewho knows. there is a looming deadline coming up with the interest rate reset on stafford loans on 7/1 so maybe something crazy will happen around then. there's a lot of debate going on in congress over this.
DeleteEEM - Sitting right on the weekly 200SMA, very tempting.
ReplyDeletei like europe a lot.
Deleteis there a europe ETF?
DeleteI'm sure we can find something to fit the bill, there should be all kinds of stuff.
DeleteJesse likes GREK, I think there are ETF's for Spain, Italy, etc...
Let's see, not sure of which of these trade here but maybe we can find something:
http://etf.stock-encyclopedia.com/category/european-etfs.html
EWP is Spain...
DeleteJesse also mentioned he likes PIE...
We could get jiggy with it on these.
Try EZU.
DeleteAZIA has exposure to Mongolia and trades uber-thin but maybe there's another...
ReplyDeleteOSH- Could all this volatility be about their 'We pay the sales tax event' ?
ReplyDeleteRYWVX closed @ 13.38, down -0.96%. The port closed down -0.4%. Had I opened a position in RYJSX (Rydex Japan 2x), which was my original thought before deciding on the 'safer' Emerging Markets play, the position would have closed up +8.15%! Am I pissed? Yes. But to complain would make me a freaking hypocrite. These kinds of things happen all the time to all traders. I'll take the minor hit.
ReplyDeleteMonday, open RYJSX and watch RYWVX close +8.15%!
DeleteYou're getting the hang of it!
DeleteYeah, I know. On Monday Emerging Markets will climb +4% and RYWVX will rip +8%.
ReplyDeletenew post
ReplyDelete