Saturday, July 28, 2007

TNH - Terra Nitrogen

Terra Nitrogen rewarded us far more than we could have thought.

The great news is that once we see a pullback of some serious magnitude then the real
fireworks to the upside will begin.

Fording Coal

Fording is going to make itself available for those who missed it at the previous low.

Long term this stock offers some excellent potential.

Friday, July 27, 2007

No Major Low Yet!

Notice on the Three Line Break Sentiment chart that further downside is needed before
any confirmation of a major low being put in place can be called.

This is one of the reasons that I strongly believe the market is not done with its decline.
While a sharp short term rally has very strong odds it will be the precursor to lower prices yet again.

I still have my August 24th time frame as the date for the low.

Time will tell.

Secular Reversal?

The potential start of a meltdown in the foreign currency markets.

Position traders stand to make a small fortune from the short side of the market in the
Euro and Pound.

Lumber - Stay Alert

Lumber is getting very close to our first buy target of 2.72, so stay alert on this one.

Crossroads Sugar

The first pullback in sugar is going to tell us much about the health of the market.

If it can find support in the 9.19 to 9.44 area and begin a fresh leg up then it will be strong confirmation that a new long term trend is underway.

Keep your powder dry for this one!

Short Term Fear

There seems to be enough short term fear created here to warrant some type of rally.

Look for this rally to calm the nerves just in time for the final squash to upset the applecart once again.

The final push lower should see a mad rush into bonds and quality, so once we see sentiment turn very bearish coupled with a flight to quality into bonds, we will know it is time to remove the hedge and get back in.

Thursday, July 26, 2007

Crude - Scalp Some Short Profits!

Very typically a move such as we saw today in crude will lead to a sharp sell off over the next 3-5 days.

I continue to remain bearish long term on crude.

Cotton - One More Push to New Highs

Look for cotton to make one more push up to new highs for this most recent move, before
a decline of substance occurs.

Look to sell cotton short on that push to new highs!

WCI - Incredible Bargain

It is almost criminal what Wall Street is doing to many of these quality companies that are
related to housing.

Take full advantage of these conditions and buy WCI while there is blood on the streets, the value is incredible!!

Arbor Realty - BUY BUY BUY

I had brought up Arbor Realty earlier and talked about the $21-$22 area on the stock
as a prime place to purchase.

Well here we are!!! So lock in that 10 1/2% dividend yield and profit from the gross
imbalances that are staring us in the face with anything quality related to housing!

First Leg Down Looks Completed

The first leg of the correction looks to have concluded today.

While a retest of the lows we saw today is possible, the next move of substance should be up.

Look for heavy resistance to come in at the 1510 area on the S&P 500.

Don't get me wrong here, I am not covering my hedge I have put in place.
I still believe there is more to come on the downside, but short term sentiment is telling
us that this first move down is just about over.

Wednesday, July 25, 2007

Copper - Pare back your long positions

Copper remains in its intermediate term bull market, but looks poised to move lower short term into the $3.09 area.

Use this area to purchase long positions.

Gold - Marking Time

Gold remains in its 5 month trading range and we await a break on either side.
Aggressive traders can play the downside here to the bottom of the range.

The Commercial Traders data is of no help at this point.

Sugar - At A Telling Point

This pullback in sugar is going to tell us much about the intermediate to long term trend.

If the market finds support in the 9.32 to 9.19 area then we can safely say a new strong uptrend is underway and a long position should be established.

The Commercial Traders data certainly tells us that Sugar should move higher.

Lumber - Tells A Story About The Housing Market

Lumber has completed its first minor trend leg up and also has confirmed a long term trend change change from down to up.

Look to establish long positions in the 272 - 273 area.

There is some excellent upside potential here!

Housing Stocks - History Repeats Again and Again

The great thing about Wall Street and Equity Markets all over the world is that if you are patient and you do your homework then huge opportunities will come your way.

One of the greatest ways to make money in equities is to find a sector that is being shunned like the plague and look for value. This is especially rewarding when such a huge imbalance of what is real and what has spooked people has a wide spread.

WCI is not the only Housing related stock that offers a tremendous value in this area, but it is one that I like and currently trades at a price that I LOVE!!

This meltdown in Housing, Real Estate and Mortgage Stocks is a great lesson to how at times there are huge imbalances in the markets. If the majority of why this imbalance has occured seems unfounded and overdone then take advantage of it!

Blackstone - Certainly has lived up to the STONE part of the name!

Blackstone is very close to offering us a great value, so keep it on your radar!

Arbor Realty

Arbor Realty is offering us a great opportunity here.

Take a good look at it!

Sunday, July 22, 2007

Simply More Proof

Here is yet another piece of the puzzle, that clearly shows how weak the current state of the market is.

As you can see, price continues to move higher, but the participation of stocks continues to erode.

With the markets holding up as well as they have in the face of such divergences, it is very possible that we might experience a mini crash that will scare the hell out of people and get them
to all throw in the towel. From this point the real upside of the market will begin.

Sometimes a Chart Just Does Not Need Analysis

I wonder what the trend is for this stock?

AGL Test and Lesson Time

Take a look at this weekly chart of AGL and tell me if it would be prudent to purchase the stock now, or wait for it to settle back and test the lows.

The answer is in the past.

I will post the answer this week.

Also look below at the daily chart of AGL.

If you recall when we were looking at AGL as an educational tool that demonstrated a consolidation zone. The stock broke out of the zone in the opposite direction, but you can plainly see that it is a very useful tool and something you should always watch for.

Notice also, that once the stock broke below the bottom of the consolidation zone, it came back to test that level once more and failed. From there the true decline began.

The Only Inflation Gague is The Growth In The Monetary Base

If you follow this headline alone, it will put you ahead of 99% of the PH.D holding economists.

While they are busy making their complicated Econometric Models to predict inflation, we can do a very simple calculation and be done with it. On top of the simplicity is the accuracy.

So, simply take the Current Monetary Base, found in the St. Louis Fed Data and then this same data from a year ago. The percent change in the data is the inflation rate and best of all is a leading indicator.

There! Now you are armed with what amounts to a full semester of graduate classes, except this little diddy is actually useful.

Secular Highs Being Put In Place?

Monthly chart of the British Pound is starting to look very much like 99% of this strong
move is over.

Sentiment about the U.S. Dollar would confirm this thought.

Ask yourself what it is that I see on the chart that would indicate this secular move is over.

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