I'm going to practice what we often 'preach' here. Immediately following a successful trade (+1.6% portfolio return on Emerging Markets), resist the temptation to trade further. The tendency has been to give much of it back the following day.
BASF is involved in the mix apparently(printing ink), someone over there is really smart, too, cause they're the ones I believe who are working on an important redesign of the catalytic converter that nobody has been able to achieve, I think these guys hired my old friend Maxwell and he's a remarkably talented (genius status) thin films engineer.
2nd, these were some pretty low lows wejust witnessed on the EM ETF's, I can comprehend your desire to take gains (could be the right move), but do you really expect further downside?
Seems like emerging markets were geeting clobbered as their currencies were falling and they took corrective action by selling US debt to favor their currencies?
Of course, I don't really have any idea of what's really going on, I wouldn't pretend to, but it's the best explanation I've been able to fantasize.....
I like suspense and trying to bluff my way through which admittedly isn't always a rewarding strategy, but I'd guess it says something about being patient and sitting on one's hands.
Think I'm going to go mow-lawn soon, while waiting...... :)
"AUMN - Getting pretty low, how do we feel about this one lately?"
AUMN is a call option on silver ever rising to $30, at which point they should be able to re-open their production. Also, they are still trying to figure out how to increase their gold recovery rates on the new mineralization. If they figure it out this year and make an announcement about it, that should launch the stock forward, as it will allow them to open their production at lower silver prices.
Thanks David, I have yet to try the pine flavored vodka but still intend on it someday hopefully soon. Only have tequilla and probably some old whiskey lying around here somewhere and plenty of access to pine needles which most likely are best harvested while the sap is rising in spring?
Added OSTK at $28.4 and $28.2 this morning. Expanding overseas in 2 months. They currently generate 2% of revenues from overseas customers. Most internet retailers are around 50%. Margins and revenues rising heading into this expansion. Could be a big momo stock depending in part on what the market wants to do.
Insiders own over 30% of the company though. One institutional holder (Chou) bought in the $12 down to $7 area and cashed in 1/2 of his position between $18 and $25. Could be a warning sign or could just be taking the profits off the table.
Average order size increased from $138 to $167 last quarter
These trends seem to be accelerating yet it trades at a huge discount to peers (0.5x Price to Sales vs 2.0 to 3.0 for AMZN EBAY GRPN). And they're getting into international starting in October which could make them significantly cheaper on a price to sales basis. What am I missing here? Just short term profit taking? Something more sinister? The company has had a history of missteps but the overall size of the company has grown a good deal since it was last trading in the $20's. With these recent trends in the biz and with growth overseas I could see this thing really taking off, much more than the recent rise it has had. I guess in a bad market it would be harder for them but it is pricing in a lot of negativity.
Re OSTK, Chou is a hard core value manager and had a very good reputation in Canada. He has held it for a long time, and knows it quite well I would assume. Him selling probably means its not a deep value stock anymore, but certainly doesn't mean it won't go up further.
Prem Watsa (Fairfax) bought a big stake in the company around the time Chou was buying I believe. He recently sold 6% of his stake. They still own over 13% of the company. On an absolute value basis it doesn't look incredibly cheap but on a comparison basis (vs peers) it's very cheap and when you take into account the longer term potential from international expansion it seems even cheaper. We shall see. I'm sure its going to be volatile. I'll look to add on pullbacks.
I could be wrong but it kind of feels like the market is going to rally a little bit in the short term...possibly back to a little above the 50DMA? The only reason I say this is the recent lows have been tested several times and yet they have held.
I vote for late day rally beginning in 6,5,4,3,2 ..... But I'm not buying mainly b/c last Fri. was an up day. Okay, maybe I'll buy the close if I'm around but I need to be outdoors right now.
Two weird behaviors I am observing on my watch list: AUMN is in the toilet for no apparent reason, while PNPFF is up for no apparent reason. I own both stocks, so the behaviors kind of neutralize each other for me. :)
Actually, it is still trading below the closing lows over the past month. Is it a break of support or a fake out? Judging by the 3 lower highs it made on the daily chart since early August, I think it is a break of support...
"Right, and how often have we witnessed such an event only later to call it a capitulation event?"
You are right -- no beliefs on my part anymore. If IWM starts going up next week instead of collapsing and rises above Thursday's highs, then I will not only close my puts but might even go into IWM calls, as it will be a move that will leave many longs on the sideline (after shaking them out today by dropping to a 1-month low). In fact, rallies soon after a quick fake below the support level tend to be the strongest ones...
IWM closed today PRECISELY on the trendline connecting the lows in Nov 2012, April 2013, and June 2013. This is the moment of truth. It will either rebound powerfully and go on to new highs at the same rate at which it was rising before, or it will completely collapse. Even if it goes sideways for a few days, that will still be a break of the trendline, because the previous ascent was VERY steep.
I did say last week that the safest trade was to wait until the trendline is broken. I rushed this trade, but I am ready to bail if IWM rises above Thursday's highs and then re-enter again if IWM breaks below today's close.
Alexander Elder wrote that only amateurs give up after their stop is hit. The pros know that faking is the name of the game, and they totally don't mind re-entering the trade if they happened to be shaken out by a fake.
Exiting and re-entering is an alternative to "toughing it out" when the trade goes against you...
David - I kind of think we're very close to a tradeable bottom here. We might get a drop below on some crazy event or news but it seems like the market won't go below the 1620ish area. that's around where the rally from the June lows stalled out before going higher. I've seen this similar pattern set up in the market in the past.
I think we may go up to new highs but I would be selling those. I just think we're going to be in a big trading range for a while here.
CVV setting up Landryesque
ReplyDeleteIt's a graphene phenomenon, right?
DeleteMaybe AMAT will buy these guys for their process technology?
DeleteBASF is involved in the mix apparently(printing ink), someone over there is really smart, too, cause they're the ones I believe who are working on an important redesign of the catalytic converter that nobody has been able to achieve, I think these guys hired my old friend Maxwell and he's a remarkably talented (genius status) thin films engineer.
Delete10yr It appears the 10yr has fallen back again, not sure why mreits seem to be holding ground. Bottom target achieved?
ReplyDelete2nd, these were some pretty low lows wejust witnessed on the EM ETF's, I can comprehend your desire to take gains (could be the right move), but do you really expect further downside?
ReplyDeleteSeems like emerging markets were geeting clobbered as their currencies were falling and they took corrective action by selling US debt to favor their currencies?
Of course, I don't really have any idea of what's really going on, I wouldn't pretend to, but it's the best explanation I've been able to fantasize.....
Wednesday morning's dumping of Indian stocks felt like a panic low, but I've learned never to underestimate how much lower a stock/ETF can go.
Delete"I've learned never to underestimate how much lower a stock/ETF can go. "
DeleteYep, that's a mouthful! :)
ARR - Someone's really taking an interest in this one at the moment, it seems like. That wasn't so much the case a few days ago. Frickin' morons!
ReplyDeleteGood article by Big Dave. Click on "Doing the Right Thing".
ReplyDeletehttp://tradersonline-mag.com/01_ezine/01_traders/en/2013/09/index.html#1/z
I like suspense and trying to bluff my way through which admittedly isn't always a rewarding strategy, but I'd guess it says something about being patient and sitting on one's hands.
DeleteThink I'm going to go mow-lawn soon, while waiting...... :)
"AUMN - Getting pretty low, how do we feel about this one lately?"
ReplyDeleteAUMN is a call option on silver ever rising to $30, at which point they should be able to re-open their production. Also, they are still trying to figure out how to increase their gold recovery rates on the new mineralization. If they figure it out this year and make an announcement about it, that should launch the stock forward, as it will allow them to open their production at lower silver prices.
Thanks David, I have yet to try the pine flavored vodka but still intend on it someday hopefully soon. Only have tequilla and probably some old whiskey lying around here somewhere and plenty of access to pine needles which most likely are best harvested while the sap is rising in spring?
DeleteGodspeed, my friend! :)
CVV looks very interesting for a trade only.
ReplyDeleteAdded OSTK at $28.4 and $28.2 this morning. Expanding overseas in 2 months. They currently generate 2% of revenues from overseas customers. Most internet retailers are around 50%. Margins and revenues rising heading into this expansion. Could be a big momo stock depending in part on what the market wants to do.
One thing that jumps out at me is, it appears insiders have dumped a good part of their position, maybe they're thinking of repurchasing a bit lower?
DeleteInsiders own over 30% of the company though. One institutional holder (Chou) bought in the $12 down to $7 area and cashed in 1/2 of his position between $18 and $25. Could be a warning sign or could just be taking the profits off the table.
DeleteFundamentally I see lots of potential upside here. Look at the following:
DeleteMargins:
Q3 2011 - 16.0%
Q4 2011 - 16.2%
Q1 2012 - 18.1%
Q2 2012 - 18.0%
Q3 2012 - 18.2%
Q4 2012 - 17.9%
Q1 2013 - 18.9%
Q2 2013 - 19.7%
Revenue Growth:
Q2 2012 - 2%
Q3 2012 - 7%
Q4 2012 - 9%
Q1 2013 - 19%
Q2 2013 - 22%
Average order size increased from $138 to $167 last quarter
These trends seem to be accelerating yet it trades at a huge discount to peers (0.5x Price to Sales vs 2.0 to 3.0 for AMZN EBAY GRPN). And they're getting into international starting in October which could make them significantly cheaper on a price to sales basis. What am I missing here? Just short term profit taking? Something more sinister? The company has had a history of missteps but the overall size of the company has grown a good deal since it was last trading in the $20's. With these recent trends in the biz and with growth overseas I could see this thing really taking off, much more than the recent rise it has had. I guess in a bad market it would be harder for them but it is pricing in a lot of negativity.
10yr testing support and seems to be holding so far, I guess the crowd is watching..... Cheering?
ReplyDeleteALDW - Insiders own over 80% of this thing, doesn't that seem like they're eating their own cooking?
ReplyDeleteOkay, I still think that emerging markets are reversing their slide through supporting their currencies via selling US debt.
ReplyDeleteIs this theory being parroted on the boob-tube at all, am I just fantasizing, or what?
Re OSTK, Chou is a hard core value manager and had a very good reputation in Canada. He has held it for a long time, and knows it quite well I would assume. Him selling probably means its not a deep value stock anymore, but certainly doesn't mean it won't go up further.
ReplyDeletePrem Watsa (Fairfax) bought a big stake in the company around the time Chou was buying I believe. He recently sold 6% of his stake. They still own over 13% of the company. On an absolute value basis it doesn't look incredibly cheap but on a comparison basis (vs peers) it's very cheap and when you take into account the longer term potential from international expansion it seems even cheaper. We shall see. I'm sure its going to be volatile. I'll look to add on pullbacks.
DeleteI'm also looking at starting a position in EXPE.
Anyone adding NOAH here? That is about as volatile as I stock as I can find.
ReplyDeleteI could be wrong but it kind of feels like the market is going to rally a little bit in the short term...possibly back to a little above the 50DMA? The only reason I say this is the recent lows have been tested several times and yet they have held.
ReplyDeleteI suspect we get a push below the lows and then a snap back rally.
DeleteRally to the 50DMA area then fail?
DeleteI vote for late day rally beginning in 6,5,4,3,2 ..... But I'm not buying mainly b/c last Fri. was an up day. Okay, maybe I'll buy the close if I'm around but I need to be outdoors right now.
DeleteTwo weird behaviors I am observing on my watch list: AUMN is in the toilet for no apparent reason, while PNPFF is up for no apparent reason. I own both stocks, so the behaviors kind of neutralize each other for me. :)
ReplyDeleteIWM briefly spiked down today to a 1-month low. Was that a preview of things to come?
ReplyDeleteActually, it is still trading below the closing lows over the past month. Is it a break of support or a fake out? Judging by the 3 lower highs it made on the daily chart since early August, I think it is a break of support...
DeleteRight, and how often have we witnessed such an event only later to call it a capitulation event?
DeleteI'm not what I just typed makes any sense at all.......
CVV. Yikes. Any news on this sucker.
ReplyDeleteI still think that could be a good buying opportunity. It doubled in 2 months. This gives back about half of those gains.
DeleteI do too. I'll see if I have time this weekend. 2 Tourney's. Kendra made the Jr. High basketball team.
Deletenice sounds like fun man.
DeleteRAS?
ReplyDeleteOSTK- Trying...
ReplyDeleteWY next week?
ReplyDeleteAnother lower high in CNI on the daily chart. A lower low is next?
ReplyDelete"Right, and how often have we witnessed such an event only later to call it a capitulation event?"
ReplyDeleteYou are right -- no beliefs on my part anymore. If IWM starts going up next week instead of collapsing and rises above Thursday's highs, then I will not only close my puts but might even go into IWM calls, as it will be a move that will leave many longs on the sideline (after shaking them out today by dropping to a 1-month low). In fact, rallies soon after a quick fake below the support level tend to be the strongest ones...
IWM closed today PRECISELY on the trendline connecting the lows in Nov 2012, April 2013, and June 2013. This is the moment of truth. It will either rebound powerfully and go on to new highs at the same rate at which it was rising before, or it will completely collapse. Even if it goes sideways for a few days, that will still be a break of the trendline, because the previous ascent was VERY steep.
ReplyDeleteI did say last week that the safest trade was to wait until the trendline is broken. I rushed this trade, but I am ready to bail if IWM rises above Thursday's highs and then re-enter again if IWM breaks below today's close.
Alexander Elder wrote that only amateurs give up after their stop is hit. The pros know that faking is the name of the game, and they totally don't mind re-entering the trade if they happened to be shaken out by a fake.
Exiting and re-entering is an alternative to "toughing it out" when the trade goes against you...
David - I kind of think we're very close to a tradeable bottom here. We might get a drop below on some crazy event or news but it seems like the market won't go below the 1620ish area. that's around where the rally from the June lows stalled out before going higher. I've seen this similar pattern set up in the market in the past.
DeleteI think we may go up to new highs but I would be selling those. I just think we're going to be in a big trading range for a while here.
new post
ReplyDelete