It may be premature, but I'm going to at least lay the foundation for a BRIC house here. Adding to earlier positions in RSXJ, PBR, VALE, and FXI. RYWVX pending.
Will not surprise me to see Shanghai rally overnight. Negativity? The 'rain in Juarez' is tapering off.
It does seem like we are getting some very good values in these markets and it's being going down so long, it should turn up soon (hopefully).
ReplyDeleteI'm buying some TUR (Turkey ETF). Nice double bottom in the chart, good demographics, good economic growth, important to Europe, etc. Some issues of course, but I like their economic prospects better than countries like India or China, or I should say I think I understand them at least, so feel comfortable buying.
More of a trade and not sure how long I will hold, but it's at $42.22, double bottom was around $40, so could get out there if it drops more and got to high $70's twice in the last 5 2 major up-markets.
Sounds like maybe you're not to hot on Brazil anymore, I can see why.
DeleteCC - Don't have time to watch that but my understanding is that austerity is over in Europe...One day moves like today are probably not the greatest times to look at performance, longer term it looks like Europe is doing well. Maybe the end of austerity is why they've been outperforming or at least performing far better since mid 2012:
ReplyDeletehttp://stockcharts.com/h-sc/ui?s=IEV:SPY&p=W&b=5&g=0&id=p16743893148
2nd I'd recommend scaling in over a few weeks. I think this negativity prob ends up setting the stage for more longer term gains in the us market
ReplyDeleteYou're right. There's something about this global sell off that feels different.
DeleteCoal - 200 railcars/day ave consumption per powerplant - The point is the shear volume of energy consumed isn't easily replaced, and yes it's going to be heavily taxed thus you probably don't want to own US coal(lower sulfur than many) unless maybe it can be exported and there is overseas demand, currently export is a bottleneck and Australia is close in proximity to SE Asia. A 1.6GW nuclear powerplant costs $10B, the US spends $490B in the defense budget and the defense dept is the single largest fossil fuel consumer, so there's a little room for improvement there.
ReplyDeleteCP, I still like BSBR. It has been trading in line with the Brazil market, which is fine, but has the advantage of a good margin of safety due to its balance sheet and good management, If Brazil tanks, BSBR's balance sheet should stop the drop from getting too large. If the Brazil market takes off, BSBR can increase their business, again due to their strong balance sheet. Plus, in general, banks are leveraged ways to play an economy.
ReplyDeleteBut, I also like to diversify risks, so getting into another EM market is probably a good thing. Chart-wise, TUR is back at the 2011 lows, but EWZ (Brazil) is almost back to the 2009 lows. Both aren't bad places to consider buying stocks.
There are lots of cheap markets outside North America these days and I moved a good chunk of money to Europe last year (ING, AEG, IBDRY). NM, which I bought at the end of 2012, is a Greek company. I may move some more there this year, but given how cheap a lot of these tier-2 markets have gotten, I think it's worth looking around these.
That Ukranian Egg Company I mentioned before - AVGR in London, bounced on the news Russia was coming out of the Ukraine, but has been moving back down again as tensions rise. Would be nice to see some real panic selling - if I could get it around $7 (it's $8.75 now), it would be at a P/E of 2 and the dividend yield in 2014 would be around 15% as they said they would distribute 35% of their income as dividends.
DeletePatricia thinks the US Govt. is somehow behind the missing plane thing.
ReplyDeleteGood girl! Never think the US gov isn't run by the good old boys club.
DeleteMy new discipline requires me to place a sell stop for my HAO shares (purchased recently at $26.33) just below the previous low -- at $25.10.
ReplyDeleteI've had sell stop limits hit at market open even when the stock didn't even trade at my limit
DeleteSimilarly, I might as well place a sell stop for my ELON shares below the previous low -- at $2.70.
ReplyDeleteBrazil economy show some signs of turning around - would be good for BSBR:
ReplyDeletehttp://www.reuters.com/article/2014/03/14/brazil-economy-ibcbr-idUSL2N0MB0FQ20140314
UBS starts GASS as a buy. Just mentioned since its a LT hold.
ReplyDeleteStill think TOF's BALT is better and looking for a LT entry point as no trading for now.
Tanker And Gas Shipping - Navigating The Recovery
DeleteWe are initiating on six tanker and gas companies with four Buy-ratings, STNG, DHT,
GASS and TNP and two Neutral-ratings, NNA and TNK. After declining earnings over
the past five years, we believe crude tanker rates have troughed in 2013 and will rally
over the next 24 months. Increased length of haul, driven by West African and South
American exports to Asia have had a multiplier effect on otherwise modest total
seaborne crude demand. The expected improvement in rates should push net asset
values (NAVs) and company earnings higher. We highlight DHT and TNP as our top
ways to play crude tankers.
Tankers: greater volatility is a sign of possible better times ahead
DeleteAfter declining earnings over the past five years, we believe crude tanker rates have troughed in 2013
and will rally over the next 24 months. Increased length of haul, driven by W. African and South
American exports to Asia have a multiplier effect to otherwise modest total seaborne crude demand. The
improved rates should push asset values (NAVs) and company earnings higher.
Containers: Supply is the problem but is P3 going to be the solution?
We believe from a fundamental perspective supply and demand will be balanced over the next three
years. However, to see a fundamental improvement for industry returns we believe something has to
change. In the absence of corporate consolidation, the P3 alliance is an attempt to change the industry.
We believe it could make a difference but that it remains to be seen what the impact will be and
whether the competition authorities around the world (especially in Europe) allow it. We believe the
market is already anticipating P3 in the current Maersk share price.
Dry Bulk: 2014 average BDI forecast cut to 1,600, 2015 recovery, 2016 downturn
We maintain our view that the global dry bulk industry will only experience a short-lived recovery until
2016. We cut our 2014 BDI forecast to 1,600 with 2,200 expected in 2015. We see a continuing
slowdown in China demand for iron ore and cut our 2014/15 demand forecast growth from 4.3%/4.4%
to 3.5%/3.7% to reflect the latest UBS global commodities team’s forecast for major dry bulk and
Clarkson’s minor bulk demand forecasts. We believe higher supply growth from 2016 will result in lower
rates.
Initiation on North American stocks: top picks DHT, STNG, TNP and GASS
We initiate coverage on North American shipping stocks with Buy ratings for DHT, Scorpio Tankers,
StealthGas and Tsakos Energy Navigation. We initiate with a Neutral on Teekay Tankers and Navios
Maritime Acquisition. We also raise Neptune Orient Lines from Neutral to Buy and raise both Mitsui OSK
and Nippon Yusen to Neutral (from Sell).
We expect new ship prices to rise in 2014-15E, driven by a rising backlog
DeleteWe expect backlogs to rise 10% YoY in 2014E and 8% in 2015E after a 6% rise in 2013, as orders
exceed global ship deliveries and are near global yard capacity. This will drive up new ship prices until
2015 as yards focus more on profitability given rising workloads. But falling orders (-31% YoY) and
backlogs (-11% YoY) in 2016E should signal a reversal of the new build price trend.
Korean yards market share to rise, while China’s share moderates in 2014E
We expect global ship orders and market share of Korean yards to rise in 2014E as higher prices create
interest for large yards to participate in the new ship versus the offshore market. We expect China's
global share to moderate as yards takes a breather after the run for orders (+232% YoY) and ensuing
backlog recovery in 2013, and weaker bulker demand in 2014E. We expect Japan’s market share to be
flat in 2014E.
Output: we prefer Korean yards over Chinese; Neutral on European equipment
We prefer Samsung Heavy Industries (SHI), given its firm orders, stabilising margin, and cheap valuations,
followed by Daewoo Shipbuilding & Marine Engineering (DSME). We affirm our Neutral rating on
Yangzijiang Shipbuilding (YZJ), given its fair valuation, and our Sell rating on on COSCO, given its
earnings risks. We affirm our Neutral ratings on Alfa Laval and Cargotec, and our Sell rating on Wärtsilä.
all UBS FWIW
UBS starts GASS coverage at technical resistance, crowd cheers! Personally, I think these guys could be transporting plenty of natty in the future.
DeleteNCR - ???
ReplyDeleteWow - that's had a nice move. I remember looking at it around $10 a few years ago.
DeleteI think banks need these guys in order to automate, replace layed off employees.
DeleteGold bugs say PM's will move inverse as global markets crash. I dunno, that never happened previously?
ReplyDeleteMicrosoft to end tech support for Win XP, most ATM's use this version as the operating system.
ReplyDeleteANGO - This one hasn't been following the broad market, I like that.
ReplyDelete$1.2x bull flag
DeleteMGIC - sold my remaining share at $8.25.
ReplyDeleteNot that there's anything wrong with it, but it's pretty expensive now and they raised funds, like to buy consulting companies, which will have lower margins and probably drive a lower multiple for the stock. So I think they have a tough time moving upwards over the next couple of years and there are better places to invest. No complaints though as I bought initially at $1.86 back in 2009 and added in the $4's in 2012, so was a very good stock for me.
I've got a couple of other ones I am thinking of selling. CAM.TO is the largest steel fabricator in North America, but the stock has had a huge run and is up near all-time highs. Business looks great going forward, but it is a very cyclical company and it always looks great near highs and I'd rather sell into good news and take my chances on missing some upside rather than waiting for bad news. Likely I will sell sometime this year if not now.
Where should I hide my new BA-777 ?
ReplyDeleteHow about Somalia?
DeleteYou guys watching this shit?
ReplyDelete/ES lows today was EXACTLY the same as 3/3 lows. The close yesterday was higher than that close. Breakout to new highs then retest of old highs. I know it's bearish out there but this is definitely NOT bearish trading yet. I don't see anything bearish about this either:
http://stockcharts.com/h-sc/ui?s=!ADRLITOT&p=W&b=5&g=0&id=p06298173292
That elusive correction will come but it looks like they might be pushing it off yet again for another time. Let's see how they close it the next few trading days.
So much for throwing caution to the wind on emerging markets: RSX up 3%, TUR up 2%. Only one down I can find so far is EWZ (Brazil)
ReplyDeleteLooks like BSBR is heading for $4.2
DeleteImpossible for me to throw any more money into this black hole.
DeleteBSBR - This one has eaten all my BALT gains and now BALT is coming off like a freight train. There are other stuff out there that actually go up occasionally instead of down most every single day.
DeleteChase banks will be upgrading their ATM's, other banks as well, maybe even BSBR, in order to cut operating costs..
http://online.wsj.com/article/BT-CO-20140314-705677.html
ReplyDeleteChina and India both have room to add stimulus with inflation being much lower
Yes, but austerity has worked so well for Europe?
DeleteChina has reached a cross-roads, wage inflation has been high and there are no more youth remaining to migrate from rural areas? Indonesia is the hot growth market, not China?
DeleteNLY - This mREIT has made a new high and come back off a bit, trades like gold does but pays a dividend. Wish I'd loaded up this one on the 50sma backtest / handle of cup.
ReplyDeleteI dunno guys, the stuff I've been reading doesn't look good for Brazil and China, these seem like markets to avoid.
ReplyDeleteAGCO - If we're going to rub sticks together to keep warm in winter, and convert switch grass and shrubbery into motor and heating fuel then we'll probably need a few tractors?
ReplyDeleteARII - I think these guys switched completely to oil cars for Buffett, have we read the earnings report to see if they're even building coal cars anymore?
NVDA - Looks almost like a bull flag, don't it?
ReplyDeleteTITN - I really don't feel much love for this one, however, what are the chances if US infrastructure projects catch fire this company has a few pieces of construction machinery to rent?
ReplyDeleteNot sure why Brazil is down and the others are up. It's impossible to understand all of the macro around a country. One of the reasons to diversify. But, I still think BSBR is up substantially later this year, but perhaps there are things I don't know if the overall economy.
ReplyDeleteBut speaking of BALT, look how long it took to bottom. Not unusual and you had lots of time to get in much cheaper last year as TOF was suggesting. BSBR and Brazil could be the same.
Also CP, if you are reading about Brazil/China issues in the press, it is almost certainly already priced into stocks.
DeleteBMO had this strategist, Don Coxe, who would always say you don't make any money reading the front page of the newspaper. Where you make money is figuring out which of the page 21 stories will become the front page stories in the future.
Yeah, LOL, I was thinking the same thing and it made perfect sense but reading page 24 it says the debt is denominated in USDs and as the Real crashes that debt becomes impossible topee. :) Oh well....
DeleteCOG- Anyone know what happened to this one a few days ago?
ReplyDelete$MITK Let me get this straight. First they try 2 give their tech away, now its PAYING people to use it? http://stks.co/d0Kb3
ReplyDeleteHey, if they just stole AMZN's business model, that stock is gonna rally like a mofo!
DeleteQuiznos files chap-11
ReplyDeletenow that makes sense. i've seen two of them close in the area in the past year. there's a chain called panera (not sure if you've ever heard of them?) that seems to be doing well. gotta check them out.
DeleteMM - Here's one that's been dropping for what seems like an eternity.
ReplyDeletehttp://seekingalpha.com/article/2089273-millennial-media-is-about-to-fly-higher?source=yahoo
I took a good deal of BALT off the table today and actually went to the dark side (TZA). I think my fears yesterday were right.
ReplyDeleteAdded a bunch of TZA going into the close. Avg is $15.45. I know there's some fear about China with traders but I don't think the average person is that concerned. I've been reading more and more reports out of there that are downright disturbing....iron ore and copper demand, exports are all dropping off a cliff. I can't really justify being overly long here. TZA is obviously at best a rental and I'm using it more as a hedge. The other disturbing thing is that the reaction from leaders in China seems to be a ho hum reaction. They're content with things slowing down and imposing some harshness. We all know how the reaction of markets is when you get this response.
ReplyDeleteThat's funny, I was thinking about the long side since during the weekend tensions concerning Crimea may ease. I guess the DAX was smashed (no mention of this on TT, you heard it here first though, right?) b/c Germany's support of sanctions are dangerous to their economy.
DeleteDon't come to TT for a take on global current events, you won't find them noted here.
Yeah I don't think this has anything to do with Ukraine etc. I think it's all about China. That was the reason many were bullish stocks for several years. It might all pass with nothing serious happening at which case I will have to sell for a loss and buy stocks higher.
DeleteThe other concern I've had is the Russell. I HATE how it gapped higher in a huge way the other day and has given it all back. That pattern is total dog crap. I've seen that turn into much more losses so many times.
I was finally able to get Brandt's site to load and found this: Because we are human, we all chose to ignore the unimportant, cherry pick articles, etc. to support want we want to believe, I appreciate Brandt's chart reading skills b/c they are objective.
ReplyDelete"DAX Targets are 8227 and 8136 with an outside possibility of 7624"
There remain a number of sites I still cannot load, hopefully this improves quickly.
Just turned on Fast MOney and that idiot that was suggesting to short FSLR at $12 is recommending shorting X and anything China related, including CLF. Looks like the China fears are most likely priced in if his contrarian nature holds true.
ReplyDeleteI was stopped out of HAO today (for a loss of about $250), which freed up some funds for me to buy more exciting stuff. :) So I just placed a buy limit order for 5 more BALT September 20 $5 calls at $2.00.
ReplyDeleteSCON keeps marching higher -- isn't it a beautiful 1-month intraday chart?
ReplyDeleteThe sun’s out (EEM +0.6%), and I’m finishing off the BRIC foundation. Financial media headlines are attributing today's drop in US stocks to the Ukraine-Russia standoff. In the meantime, RSX (Russia) closed up +3.6%. If war breaks out in Crimea, I’ll frame an Eastern Europe front entrance next week.
ReplyDeleteOne night soon, Shanghai will gap 'limit up' while the financial media is rehashing Big Trouble in Little China.
DeleteYou're probably right. It feels crowded on the TZA boat already
DeleteI also opened two (2) RSX January 2015 calls with a strike price of 25 @ $1.40.
Deletehttp://wealthmanagement.com/archive/resurrected
ReplyDelete'For Niederhoffer that point came in October 1997, during the Asian currency crisis, which was sparked by the devaluation of the Thais bath, which had a ripple affect that upset the world's financial markets. Characteristically speculating against the flow, Niederhoffer bet big that U.S and Thai stocks would move upward using highly levered futures and options contracts. But the markets plummeted, triggering a rule that closed the NYSE. As Niederhoffer notes, “Confronted with a demand to come up with many millions to meet margins the next day, I was forced to close my fund.”
'Niederhoffer's strategy is to make leveraged bets on anomalous trading patterns, patterns that go unnoticed by others. Thai stocks should have rebounded, according to Niederhoffer's analysis. And the U.S. market should have also shown some strength. Only they didn't. One Wall Street analyst, who asked that his name not be printed, says, “Brilliant though he is, Victor Niederhoffer confused the idea of being right in the long term with being right all the time. When you make the kinds of bets he does, you simply can't do that. It was sheer hubris on his part.”
'Niederhoffer told Registered Rep., “You might say I succumbed to the dream of emerging markets. Many people made that mistake but not to the extent that I did. In retrospect, I allowed the probability of ruination to be too high. It created a domino effect that led to my complete vulnerability and a Titanic-like concatenation of events. It was a terrible catastrophe, one I think about every day.”'
Niederhoffer lost it all, did a little soul-searching, and won it all back.
DeleteThat's one thing I admire about everyone here. We understand that it's impossible to make money trading in the absence of risk. Win or lose, it's the willingness to accept risk that separates 'players' from 'spectators.'
DeleteYet another reason not to use leverage or options. You can still crush the market with plain old stocks.
Delete2nd - You can't win if you don't take risk. However, I do think you need to take some chips off the table if you're just not feeling it. You can always buy back later in full or change strategy after admitting you're wrong.
DeleteGood to hear people are shorting China. Interestingly, my best stock today was Chinese car parts company, SORL, up 2.3%. Probably doesn't mean anything, but good to see.
ReplyDeleteRight. Now's the time to sell off all emerging markets positions. I mean, there's a 'crisis,' for crying out loud. Sell low. Buy 'em back when they start to take off again- preferably, after a +30% move has 'confirmed' a reversal in trend.
DeleteI guess my near term concerns are:
Delete(1) the US hasn't reacted to weakness in the emerging markets and traders are fairly complacent.
(2) i still have that nagging feeling that 170% up over 5 years is bad. in looking back at history it has tended to be followed by 15 to 50% drops. I think we get the former, if we do.
(3) Fed tapering, while it's probably not a big deal, it's still something different.
(1) Nor have emerging markets responded to strength in US equities. EM traders display absolute panic. (Check out the action in RSX and RSXJ the past two days.)
Delete(2) Note the divergence between SPX and EEM today. Or IWM and RSXJ.
(3) Has the Fed not telegraphed its intentions loud enough?
(4) Last, but most important of all> my time horizons are very flexible. I can have a LT conviction in emerging markets, yet trade in and out, long and short, focus on specific countries/stocks, and change my mind multiple times along the way. All I want to do is drive my portfolio from New York to San Francisco. I don't care how I get there.
It's vodka for me tonight.
ReplyDeleteA lot of emerging markets and the US market have been moving in opposite directions for a long time now. They have to get back into synch at some point.
ReplyDeleteBetter to look at individual stocks an make decisions (says the guy who bought the Turkey ETF).
It's rare that everything moves together. Other than the absolute crash from fall 2008 into March, 2009, there is always stuff going up. In the 2000 crash, there were lots of stocks doing well. Even though the S&P peaked in mid-2007, commodity stocks still did fine until mid-2008 when it all fell apart. Really don't see it all falling apart now, so better to avoid sweeping bets.
Look at NWLI finally making its move maybe, with loads of value support.
Just because Mark was asking before, my stocks are now up 4.4% for the year in C$. That would be up 0.4% in US$, so ahead of the market now. I've got an unusually large position in CKI.TO right now as the about 35% undervalued and there are catalysts to get this moving. It is up over 6% YTD, so that is helping a lot
ReplyDeleteNWLI - Yeah, that quick drop to near $200 was enough to shake me out, had a feeling it would vault, LOL, and I nearly pulled the reentry trigger right at the low, too, but was agonizing too much over other stuff.
ReplyDeleteAnyway, 1845 was the support for SPX, and we dipped a little under as is customary.
TOF - Good point, you're probably correct about this not being about Ukraine, but about China..
Panera - Yep, we have them here and they seem popular. Once someone gave me their bread bowl from having soup of some sort and the bread was really stale, so I haven't bothered to go. Everyone raves about the place though, I'm the lone one lacking desire, LOL.
ReplyDelete2nd - I'm in agreement with you. Just playing a bet that we see a short term spillover from the china / em mess first in the us. Lots of high flyers are getting taken down one by one which tends to precede drops. At first it was a few of them but they started going after plcn bac and several others. So I'm taking a fairly big st bet that it dumps but with a short leash. I'm still holding into a lot of balt as well
ReplyDeleteIt will be a change-up pitch. We likely see a dead cat bounce next week, into which I hope to sell. Then further downside, into which I hope to buy.
DeleteChina - LOL, first it was copper then it was iron ore, wonder what the next collateral material will be, uranium or maybe something like coal?
ReplyDeleteOINK - This one fell quite a bit Friday, fakeout or perhaps China developed a sudden distaste for hog?
I have to admit I find Chinwagtrader (the old ObjectiveTrader) a bit confusing, expecially some of his charts, but he is very, very bullish on China, but out of the U.S. Also still liking Gold for a trade:
ReplyDeleteCWT Bull Market TARGET was 1885-1940 and we hit today in ES 1887 and SPX 1883 cash.
As said in January, raise cash and stay awhile away from the market. This is certainly not a recommendation to go short but the odd trader might consider to have some shorts
CWT entered today shortly after open DIA, SPY, IWM shorts and some speculative TZA as well.
We already raised cash as stated in January article and are mainly interested to be long in CHINA ADRs since few month already and other monthly oversold sectors.
CWT still holds DBA, GCC, Uranium, Rare Earth, Miners, CORN, SOYBEANOIl, SOYBEAN
Largest LONGS are CHINA ADRs , Sectors, Tech, Consumer Stocks, Alternative Energy, Recyling, CWT does not like China Banks as the Bond & Loan issues are not solved yet.
CWT also likes the odd Frontier Market.
CWT maintained past many years a bullish perspective as our readers can verify and this is the first time we are of the opinion to raise cash levels and lower risk exposure in US & EU equities.
You need an account to read now: http://chinwagtraders.com/author/doc-barter
DeleteThat's interesting. What are his downside targets for the US? I'm in agreement with him on both fronts I think. The China ADRs should do well but a lot are up pretty big. One idea I keep coming back to is that KNDI stock. I've watched that thing since $4 but I have a feeling that will hit $100 some day because China looks like they're getting really aggressive with cleaning up pollution.
DeleteChina is seeing a lot of wealthy people flee their country because of the pollution. A lot of the real estate demand in the US is from Chinese buyers. China is going to get extremely aggressive with pollution control over the next few years. This is a major trend that we should be focusing on. That's part of the reason I like GPRC, but electric vehicles is a good way to play it.
DeleteYou can create your own account for free if you like and you may understand his talk of cycles and squares more than I am willing to put the time into, but, this is probably his best summary:
DeleteSquare 60 monthly is March 2014 and the fact that Dow Jones is at 1 x 1 bottom 74 shall be recognised as " Time to Sell -> no matter the price".
This way bottom and top picking is avoided and a major market move was being enjoyed.
The is 1 x 1 bottom 82 offering strong support on a monthly chart. ca 13200 in Dow Jones and offers the next "Time to Buy"
The weekly chart is suggesting 14200-14800 as strong suppoert.
Re polution in China, certainly seems like a good trend to get involved in. As the middle class grows, there will be more demand for this certainly.
Deletehttp://www.bespokeinvest.com/
Deletehas interesting charts today showing how the BRIC countries have done compared to the US and also some interesting correlation charts which show US and China (and many other countries) being negatively correlated. If this hold, could well be we see US up, China down over the next while.
My hope is that we get this 15% or so pullback here soon and it allows us to enter into a lot of these positions at 40% down from the tops. I have been reading a lot of trader comments over the past day trying to gauge sentiment which is quite hard but one sense I'm getting is people are buying dips in stuff like CSIQ and the solars mainly because that has worked for a while now. If we do get a larger correction, those dip buyers would be puking out stock just like the buy and holders and it would set up for a nice entry point on a lot of interesting stocks, possibly 50% haircuts.
DeleteCould happen. Wouldn't be a bad approach to build a position over a few weeks taking advantage of weakness in individual stocks.
DeleteI'm still a little cautious on China, but really, we've haven't had a Sino-Forest type scandal for a long time, so maybe I should be giving China more credit for being a reasonable place to invest.
Yeah I guess part of my own recent caution comes in part from protecting huge gains over the past several years. Investing is basically my full time job now given how much more I can make from it than from my own side business. And in looking at the parabolic moves in so many sectors and stocks and the markets, couple with fairly extended valuations in some areas like small caps, I think the risks are starting to outweigh potential returns in the short/medium term. A 15-25% correction would get rid of that pretty much.
DeleteI would agree that some stocks are ripe for selling, but others, like BSBR, are already beaten down and don't have much downside without a crash. Could be more of a market rotation then a large pullback. A lot of the financials, are not really very expensive and many of the commodity aren't expensive unless we see a big drop in oil, etc.
Deletein order to get an overall market drop, I think we would need to see a lot of money leaving the market. Given that the economy continues to improve, and interest rates are low, I think people would be more likely just to look for other stocks to buy rather than get out of the market.
But, my risk tolerance is such not living through a temp percent down draft is not a big deal to me. So a different approach.
2nd,
ReplyDeletejust reading your comments in more detail and, if EM's, which you have long term conviction in, are ready to roll, you may want to think about holding part of your position. AS Jessie Livermore says:
“Well, you know this is a bull market!” he really meant to tell them that the big money was not in the individual fluctuations but in the main movements that is, not in reading the tape but in sizing up the entire market and its trend.
http://www.tischendorf.com/2009/07/02/jesse-livermore-advice-how-to-trade-in-a-bull-market/
http://www.marketwatch.com/story/ukraine-is-not-going-to-destroy-your-portfolio-2014-03-05?link=mw_home_kiosk
ReplyDeletehttp://www.businessinsider.com/china-widen-yuan-trading-band-to-2-2014-3
ReplyDeletehttp://www.reuters.com/article/2014/03/15/us-china-yuanband-idUSBREA2E07V20140315
DeleteWatching another episode of 'The Returned' and getting even more weird-ed out.
ReplyDeleteI hate being a debbie downer and hope I'm wrong but I'm definitely seeing a lot of signs of a significant decline coming up...15% to 40%. No idea of duration. A lot of signs are in place technically. DJIA is a major red flag here. I know it's only 30 stocks but it's some of the biggest in the world:
ReplyDeletehttp://finance.yahoo.com/q/cp?s=^DJI+Components
Again, I hope it doesn't happen as I still have a pretty large long position in BALT.
OK, tell me what you think of the following thesis:
Delete1. If DJIA looks toppy, what about markets like EEM? It looks like a good chart to me with higher lows than last summer and potentially retesting the January lows now?
2. Assuming US markets are going to get hit, I'd say its 50/50 that it drags the emerging markets down. They've been moving in opposite directions for a long time now, so a rotation of money out the U.S. into some of these other markets is just as likely as a broad economic fear which drags down all markets.
3. Wouldn't stocks like BALT be more correlated with Emerging markets than the US market? So, even if the DJII goes down, I'd say there is still a good expectation BALT goes up with the emerging markets.
I don't know what to make of this all to be honest. I'm on high alert right now. Several things have come up anecdotally as well. My own furniture business has really slowed down a lot as soon as the new year came. It doesn't really mean much (because we're so small and any little thing could cause it) and I thought maybe it was just us but I've talked to a few of our suppliers and they said that things are very slow...and my brother in law's electronics business (about $6 Million annually in revenues) has slowed down quite a bit. This is why I was asking a month or two ago what everyone thought about Obamacare cutting into spending habits. I don't know if it has but it makes me wonder if something is going on under the surface and this is showing up in the technicals of the market. Who knows. Just thinking out loud:
DeleteS&P did $107 in earnings. What happens if we get a flat or slightly down year? $107 x .95 x 14? 1,420ish. That might make sense on a longer time frame as that would put in another higher low vs the Nov 2012 lows. That's the fundamental nonsense. Technically, here's what I'm seeing on the weekly charts:
*Rollover in MACD with test of downward sloping line that failed
*Sell signal on full stochastics
*Top of bollinger band rejected
*Negative diverging OBV
This has happened only a handful of times in the past 14 years and here are the drops afterward within the next 3 months:
Now: ???
5/5/11: -18%
10/16/07: -15%
3/7/05: -5%
7/20/99: -8%
7/20/98: -19%
Also regarding Chinese ADRs...perhaps the small caps will do ok but keep in mind that many Chinese ADRs have had MASSIVE runs:
ReplyDeleteDANG
BIDU
YY
VIPS
BITA
QIHU
WUBA
Most are in the internet space but there are plenty others. I think the microcaps should be ok but it's hard to say now what would hold up best in a selloff. Probably best to just make a list of the ones you like the best and if you're not in them then wait until you get an opportunity during a selloff.
I'm biased as well on this so take a lot of this with a grain of salt: I have about 55 to 60% long TZA.
Wow just woke up and looked at futures. So much for things looking bleak!
ReplyDeleteYeah, a little surprised after the vote in the Ukraine, but I guess there are a lot more important things going on. Will be see if it holds this morning.
DeleteRe China, FXI, the China large cap ETTF, is also down near the lows for the last 5 years since the 2009 bottom (still 50% above that), so, I guess, like always, there are expensive and cheap stocks in every market.
But I think that just re-emphasizes how hard it is to play macro trends (guess the Crimea vote was priced in) and better to look for stocks which will do well regardless.
DeleteBB, I guess you're saying FXI is expensive. I can't disagree, haven't looked that chart over closely.
DeleteBALT - Have to love the way this one gets ripped higher by 4% on 30k shares.
NIce move in KNDI this morning - up 13%
ReplyDeletethey had earnings today I believe
DeleteCrazy price action, I guess plenty of ticker watchers were knocked out last week, the excuse was Crimea?
DeleteI'm still struggling with my SIP service, can't get about half my sites to load. Rebuilt my entire hard drive from scratch(reformat!) and still the same thing....
Small electric cars for the masses, I guess, I hear elec cars are popular in China.
DeleteI came in thinking if they can close this above 1860ish then the bulls are back in charge. It's right there. Feels like shorts racing for the hills. I understand now why they call it the pain trade. I took some BALT off at $6.84 and added TZA at $14.86.
ReplyDeleteWill close TZA if they can close SPX over 1860
DeleteDRYS has an H&S but the neckline has a positive slope, so it's more unlikely to fruit.
DeleteIf we did turn...remember how ferocious the short covering rallies were back in the day?
DeleteCP, I haven't look, but I think FXI is cheap as it is near 5 yewar lows and general market commentary on China is that it is one of the cheaper markets.
ReplyDeleteBought some Jones Energy (JONE).
ReplyDeleteAlso, bidding for Canadian Air/Tour company TRZ.B, but up today.
Both were hit on earnings last week and seem cheap relative to their prospects.
GMO back at the bottom again.
ReplyDeleteThis one is totally dependent on price of moly, not sure what made Hanlong think there's going to be some kind of increased demand but I'm still curious. Maybe the guy just was manipulating the stock?
DeleteWe received 3 inches of snow here last night, sheesh, winter just keeps on coming.
What's MUX reacting to?
ReplyDeletereacting to being a general POS?
DeleteLooks like a classic knockout, but have doubts it's fake. Under $2 it's worth a risk maybe, not here IMO, without some knowledge of if they ever can become profitable.
Deletecareful with them longs fellas. not set in stone but just be careful
ReplyDeleteI added a bunch of TZA and sold a bunch of BALT today. TZA avg is now $15.29. I don't like averaging down unless I have fundamental conviction on something so the only reason I'm doing it here is because the risk-reward is very heavily tilted in my favor. I'm risking maybe 2% upside on a leveraged ETF vs potentially 18 to 45% downside.
ReplyDeleteDrys Shipping - Was finally able to download BIMCO's comments, you guys probably already read them but thought I'd make an effort to share them with the TOPICS community:
ReplyDelete"Though BIMCO still expects a positive 2014, it believes "see a winding and potentially long road back to a fully sustainable market." The organization estimates that there still exists an oversupply problem by 20%-25%. A problem for the industry that expects demolition of old ships to bail out the overhang is that rising rates make using the very old ships more attractive rather than scrapping them. BIMCO expects scrapping will actually drop by 33% this year by tonnage compared to last year."
One thing that keeps coming up in the back of my mind is if China is aggressive with doing away with pollution they will try to switch away from coal, which reduces the growth demand component for that for dry bulkers. I don't know if that's feasible but was just thinking about that a lot.
DeleteRound trip on IWM for intraday trading. let's see if bears have anything else left in the tank.
ReplyDeleteGPRC and CREG both up nicely today on the China pollution control initiatives announced. I still have a whopping 1,000 shares of GPRC in one account.
ReplyDeleteJeff Saut has a good chart showing how much farther we really have to go if this is the start of a new major bull market (which I think it is):
ReplyDeletehttp://www.raymondjames.com/images/inv_strat/140317_3lg.gif
I think this bull market could go a lot higher than most people think. We will have our 20%+/- pullbacks along the way but low int rates and low inflation is very positive for stocks.
DeleteLooks like we got some good company in shipping stocks:
ReplyDeletehttp://www.efinancialnews.com/story/2014-03-17/hedge-funds-private-equity-shipping?ea9c8a2de0ee111045601ab04d673622
TOF, you are right that if China does something about coal, it could really hurt, but I don't think they have good alternatives for the next few years. Nat Gas is not that prevalent in China and they are building nukes, but they are quite far away still. But I think a bigger worry would be if they cut their infrastructure spend and reduced demand for steel as a lot of the dry bulk shipping supports China steel production.
I warned you, folks, about SCON on Friday -- that perfect upward channel on the 1-month intraday chart is playing out really nicely...
ReplyDelete"I hate being a debbie downer and hope I'm wrong but I'm definitely seeing a lot of signs of a significant decline coming up."
ReplyDeleteI see a mini H&S formation on the US indexes, with lows on March 3 and last Thursday. That base level also corresponds to the previous highs achieved in January. If that base level is broken, I'll buy some puts for protection of my longs.
If BALT is to retest the bottom of its upward channel since August, it should drop to about $6.
ReplyDeleteI will not wait for that to happen, though, to add to my position -- the recent pullback is decent enough already. I have an open order to buy 5 more September $5 calls at $2.00, and the current bid is $2.00, so that order might get triggered today.
DeleteSeeing a lot of blah action in the leaders. Best ones I can find are PCLN, AAPL, and GOOG...maybe CSIQ. CSIQ is interesting here.
ReplyDeleteThat is, blah after the open. Still very strong since FRI of course.
DeleteMy buy limit order for 5 BALT September $5 calls has been triggered at $2.00. Placing a sell limit for these calls at $3.00.
ReplyDeleteBALT- OK, I bailed too. Even though it was only a medium size position, I had enough gains, 20%, that I didn't want to lose anymore of. I also kinda agree with TOF regarding the market in general, although not enough I guess to trade on it. I'm just seeing strange stuff that doesn't make sense to see. Only have small positions in ARR, BSBR, MCP, AHP now. Probably 90% cash. +9.77% YTD.
ReplyDeleteNice start to the year Mark!
DeleteNice Mark! I have a big position in TZA that I worked down to $15.25 avg. Sitting on a bunch of cash too. Small caps underperformed today but still nothing to sneeze at...up 1/2%.
DeleteLonger term I still see a long bull market b/c low interest rates and low inflation can only be a tailwind for stocks. But I don't like the risk reward in the short/medium term. A couple more green days would change that.
You may be right on the pullback, but to me it still seems like sector rotation. Seems like people are looking for value and going after stocks that haven't moved up. We'll see what happens, good to be alert - it's hard to understand the broad market sometimes when you are invested in your own stocks.
DeleteSome good Brazil news:
ReplyDeleteBrazil adds 260,823 jobs in February, more than double forecast
15:42 EDT Monday, March 17, 2014
Print this article
BRASILIA, March 17 (Reuters) - Brazil's economy added a net 260,823 payroll jobs in February, the Labor Ministry said on Monday, more than double what market analysts expected in another sign of strength in the country's labor market.
Economists had expected the economy to add 110,000 positions last month, according to the median forecast of 6 analysts in a Reuters poll. The highest estimate was for the creation of 130,000 jobs that month.
Last year the Brazilian economy added a net 730,687 payroll jobs without seasonal adjustments, the smallest number since 2003.
The pace of job creation has slowed in Brazil after three years of meager growth, but unemployment remains around record lows as more Brazilians opt to dedicate time to education and training.
Interesting that GDX and GDXJ are down so much (3.6% and 4.6%) on a day when gold is down less than 1%. Either the stocks got ahead of themselves relative to gold and are just correcting a bit or perhaps we near the end of this uptrend in Gold. It certainly has been a great bounce for the people who caught it.
ReplyDeleteWhat I meant to add is this could be another example of people rolling out of winners.
DeleteAnd then look at NWLI, the cheapest stock I own, up 25% since the beginning of February after basing for 6 months.
JONE - guess I bought too early today. Ended up down 3.5%. When you buy bad news, it's hard to know when it is fully priced in. Hopefully it is now!
ReplyDeleteI emailed to see if my guy knows it.
DeleteHe's never heard of them.
DeletePickens selling XCO at these prices. 2M shares.
ReplyDeleteInteresting. You've got 2 really smart investors in Wilbur Ross and Prem Watsa buying XCO as well. Somebody will be right and somebody wrong.
DeleteSpeaking of Wilbur Ross(who I do respect), 4 minute video on shipping: http://www.valuewalk.com/2014/03/wilbur-ross-on-shipping-rates-diamond-s-ipo-and-china/
ReplyDeleteSays confident the demand for commodity shipping will be there because when low income people improve their standards of living, their use of commodities increases.
This article kind of confirms my worry about the shippers in the near to medium term:
ReplyDeletehttp://www.telegraph.co.uk/finance/china-business/10703990/Looming-property-default-in-China-raises-fears-of-broader-crisis.html
With pollution controls and a clampdown on construction lending, you could make a fundamental case for some tough demand growth. I don't quite know how this all pans out but I'm beginning to think the shippers take longer to base out. Some of them had a huge run, particularly NM..perhaps there is a longer consolidation period ahead before further gains?
BB - My thinking on the short Small Caps is a variety of reasons...I'll probably be wrong and stopped out but I figure I might as well take some risk and try it here since the technicals are lining up and valuations are really crazy in that space:
ReplyDelete20X P/E and highest price to sales ratio in its history
Hey Brent - I see that Reminiscences wrote about JONE...is that where you found them? I'll have to check them out.
ReplyDeleteI like the LOJN idea that Reminiscences mentioned. I remember looking into them before and didn't realize they're getting into fleet management with TomTom. That's a great idea for them. Will research that one some more.
ReplyDeleteDavid - nice call with SCON. Excellent looking chart
ReplyDeletehttp://chinwagtraders.com/article/sp500-long-term-trend---9-december-2012--
ReplyDeletejust a test :-)
ReplyDeleteGPRC, DANG, GAME, DATE, CYOU, CLNT, MY, HSOL, CALI, NPD, BORN etc are all very pleasant with a longer term view and monthly chart showing positive divergence and money flow increasing. Needless to say that the majority remains bearish towards China and a big mistake is to view FXI. The banks & export based earnings corporations should be avoided. Domestic market will recover quicker.
ReplyDeleteHey doc good to see you here. We've been following your site a bit. I completely agree about china domestic stocks. Add onp and STV to your list
Deletealready entered STV
DeleteKONG chart is amazing. $13 should be next
ReplyDeleteThis sure looks like the real Doc. How did you find us. I can't remember if I gave you this site of not. Are you still bearish on the shippers?
DeleteI am never bearish on shippers. Just take some profits. TNK, TNP, FRO, VLCCF, SB, lately DRYS entered. NM are all good. But as I said back in Sep 2012 early 2013, we are now at same levels for CHINA ADRs. Do not miss this BULL !!! We will see some vola due to weak hands change to strong hands. The next few years for domestic market stocks will be amazing. Be patient and enjoy the long term ride
DeleteTOF, I agree on valuations on small caps, so it seem almost certain they will underperform at some point in the next year or two. Getting the timing right on these things is always tricky, but perhaps the technicals you mention will bear out and the time is now. I'm tryiing to stay way from overvalued ones as much as possible.
ReplyDeleteRe JONE,
ReplyDeleteThanks for looking Mark. It is a new company.
The Reminscences guy was where I found this. He has a great track record in general but also, is based in Calgary and seems to have good energy industry knowledge and made some good energy buys previously and his writeup makes a lot of sense to me:
http://reminiscencesofastockblogger.com/2014/03/15/i-think-the-market-has-it-wrong-with-jones-energy-jone/
http://reminiscencesofastockblogger.com/2013/12/10/week-127-a-couple-of-new-stocks-and-getting-rid-of-a-few-others-jone-mhr-pxl-ca-dgit-trox/#more-4541
Closing Russia positions opened last Friday this morning.
ReplyDeleteRSX closed @ 22.90.
RSXJ closed @ 29.74
Long term, Russia still looks good.
DeleteAs an aside, ATACX rotated back into the long bond last Friday. Whereas Emerging Markets closed up +1.2% yesterday, ATACX closed off -0.93%! Needless to say, rotating my --- out of ATACX was the right move.
DeleteTo be fair to Michael Gayed, his defense of the weekly timeframe for reallocations is supported by backtesting. Since it’s a quant model, I’m sure he’s right. I just prefer more flexibility, and have more confidence using sentiment (and maybe my sixth sense) for my trading decisions.
EEM now up another +0.62%, and I plan to close RYWVX at the 1030 am trading window.
Well done now rotate to the dark side with me :)
DeleteYes, well Janet Yellen does come across as a 'dark' influence.
DeleteI need someone to get stopped out with!
DeleteTOF - Our primary signal for going to the dark side triggers when you get stopped out.
DeleteHa I figured!
DeleteElectric Utilities Brazil (Sounds like Greek to me!):
ReplyDelete"ANEEL: no changes to spot price methodology
No spot price methodology changes planned as suggested by recent press reports.
Should reduce fears of deterioration of regulatory risk perception if confirmed.
Tariff flags (“bandeira tarifária”) under consideration
This extraordinary tariff for moments of thermal dispatch is possible, but depends on
changes to legal framework. Agência Brasil reports that applying the “bandeira
tarifária” only for distributors that effectively purchase thermal capacity (vs. all
distributors) would make more sense, according to head of ANEEL.
No disco concession renewal fee, but favor dividend limit
No plans to charge a fee for renewing distribution concessions as mentioned in the
press a few weeks ago. ANEEL has analyzed the quality of service/financial
situation of concessions expiring in 2015 and a decision is now up to Ministry of
Mines and Energy (MME), most likely in 2015. ANEEL favors dividend payout
limitations for renewed concessions that do not meet minimum capex or quality of
service standards (no impact for remaining concessions that expire in 2020+).
ABRADEE: future tariffs to guarantee debt issued by CCEE
Debt to be issued by CCEE (energy clearinghouse) to pay for distributor thermal
dispatch costs will be guaranteed for future tariffs and will ultimately have some
form of Federal Government backstop. Conversations with CCEE management
indicate interest from different banks in providing financing.
No major changes expected for concession renewals in 2015
Legislation approved in 2012 that allows ANEEL intervention in underperforming
concessions already provides necessary framework for dealing with distributors not
meeting service standards. Does not expect any dividend limitation as would be
perceived interventionist, which the Federal Government is now trying to avoid.
Tariff flags unlikely in 2014
ABRADEE does not think tariff flags will be implemented this year, despite studies
and proposal to change methodology for immediate implementation.
Potential rationing: impact uncertain, 2001 not a reference
Impact on distributors from a potential rationing is uncertain at this point. Cannot
use 2001 rationing as a benchmark since rules and regulation have changed.
4th cycle reviews: encouraging signs for regulatory WACC
ANEEL public hearing expected for April. ANEEL proposed a 7.03% WACC for
remuneration of new investments by renewed generation concessions, viewed as
encouraging since distribution WACC should be higher as the business entails more
risks (distribution WACC is currently 7.5%, we use 6.5% for 4th cycle).:
Ready for Yellen tomorrow? More from South America:
ReplyDelete"LatAm Airlines: Venezuela: heading new views and valuation; LFL up to BUY
3/18/2014 12:48 PM
We revise our views and valuation post the unresolved event in Venezuela; we upgrade LFL to Buy. We expect LFL to enter into a positive earnings trend, benefiting from the turnaround in Brazil and merger integration. We maintain our Buy ratings on COPA and Avianca, although we revise down our valuations in order to price in Venezuela."
$3.23B Credit Facility for Geely Auto, China
ReplyDeleteBSBR - I received the dividend, forgot about that one but it's pretty juicy aside from the healthy Certif fee charged.
ReplyDeleteDry shipping - Doc Barter is bearish? Thanks for finally sharing that, LOL
It was from months ago if i remember right.
DeleteOkay, I guess the call was wrong, then. Thanks for followup. So far, the BALT chart may morph into a continuation, hopefully Yellen says buy EM stocks, tomorrow.
DeleteNWLI - Dang, shaking my head and kicking myself for getting shaken out! Same phenomenon with ING and AGO..... Sheesh!
ReplyDeleteSCCO - Under $24 soon? China will need copper for electric town-car motors, the Chevy Volt motors are 55kw motors.
ReplyDeleteAre you guys driving electric cars around town yet? I don't see wht you wouldn't be seeing these more often in progressive Cali even though they're more expensive, they could be small like a golf cart to reduce the cost differential, why do we commute around town using such large cars still?
KWK - Approaching my stink bid, but turned back up. Is KWK out of favor by the guys who know trading?
ReplyDeleteEPAM - Recent losses are erased. Still, wonder why this one really took the hit, if the Ukraine sitch was the real issue?
FB - This one's going to $500 eventually, isn't it?
ReplyDeleteyeah probably. maybe it gets to low $60's first to gap fill...
DeleteBaltic Dry Index (BDI) +37 1518
ReplyDeleteTDW - Seems cheap to me, via the chart....
ReplyDeleteAnyone have any insight on why interest rates are down today?
ReplyDeleteCP,
ReplyDeleteWith stocks like NWLI, ING and AGO, you are buying them for their underlying value and expecting a reversion to the mean. Because you know the value is there, you can feel comfortable averaging down on low prices or at least holding through the inevitable pullbacks. But, you have to confidence in the value to trade like that.
Sold half of my position in NM to reduce the risk with all the cross-currents everyone is talking about here.
ReplyDeleteHappy to do so as it is almost a triple, so like to lock in some profits. Again, thanks TOF for pointing me at this. May rebuy back if we do get a large pullback.
BB - Thank me if I'm right. So far I'm not.
DeleteI meant thanks for pointing me to NM back in 2012 when it was under $4.00 - haha.
Deleteoh. well NP but they're looking solid yet again. without us of course :(
DeleteJst took half my BALT position off as well, seem like a prudent move. Now we should buy Japanese banks.
DeleteI just can't believe the market swoon over the Crimea situation, seems awfully short sighted to me. Guess nothing should surprise me anymore......
ReplyDeleteWall of worry...
DeletePBR + VALE + FXI now also closed. I’ve decided to plant a hedge instead. Opening HDGE @ 12.68. Modestly bearish short term, but I think we’ll see a nice Emerging Markets pitch soon.
ReplyDeleteExcellent trading. My foray into TZA has put me squarely into matching the market's return now for the year. Yet another example of why it pays to focus only on stocks, not markets. I did assess my overall pain threshold and realized I was on the verge of capitulating at $14.57 TZA so I decided to buy a little more there.
DeleteWe cannot engage in risky behavior with TZA. Whatever she has is worse than syphilis and gonorrhea combined.
DeleteTrue...although you're talking to a guy that had all of his net worth in YRCW so this is tame comparatively.
DeleteHDGE provides a condom.
DeleteBlackrock positive on Turkey and EM's in general:
ReplyDeletehttp://www.bloomberg.com/news/2014-03-18/blackrock-says-bears-blundering-by-exiting-emerging-markets-1-.html?cmpid=yhoo
I'm now up 6% on my TUR buy of a few days ago, so helping to offset my bad timing on JONE which is down again today. Chart looks pretty good for TUR in my opinion.
Next time instead of placing ourselves amongst statistical wreckage of yet another knockout, can we please just sell the top of channel?
ReplyDelete