Saturday, September 29, 2007
Friday, September 28, 2007
LOW RISK SOYBEAN TRADE - SELL SHORT
The price action in the Soybean Market is clearly indicative of a swing high and should lead to some type of decline. How strong the decline will be should be answered in the trading on Monday.
We have been selling the beans short over the last few days and added strongly to our short position today.
Beans look to be in a very low risk short selling area.
We have been selling the beans short over the last few days and added strongly to our short position today.
Beans look to be in a very low risk short selling area.
A Simply Incredible Bullish Outlook C.O.T. Report
As all of you readers know, I am a huge follower of the Commitment of Traders Report and I utilize this very reliable indicator to the fullest.
The data that came out today, really helps to clarify the current condition of the equity markets.
All I can say about the Intermediate to Long Term is BUY BUY BUY!!!
While I still anticipate a decline from current levels to retrace at least half of the market rally from the August 16th low, I would have to say that my analysis of a potential 15-20 % correction is stock prices has lost just about all of its merit!!
As you can see by the chart below, The Commercial Traders or Smart Money were massive and I mean massive buyers of equities over the past week. As a matter of fact, their buying was the strongest in over 10 years!!!
These Commercial Investors as we have seen time and time again are always on the right side of the market in equities, so it is very safe to conclude that if the market were to be about to decline 15-20% then we would NOT see such strong buying by these Smart Money Players.
What this tells us is that the August 16th low in the S&P 500 should be the ultimate intermediate term low and that the next major move in the averages will be higher.
I am however, keeping my hedge in place until we complete the short term correction I anticipate, probably in the 4-7% area.
The data that came out today, really helps to clarify the current condition of the equity markets.
All I can say about the Intermediate to Long Term is BUY BUY BUY!!!
While I still anticipate a decline from current levels to retrace at least half of the market rally from the August 16th low, I would have to say that my analysis of a potential 15-20 % correction is stock prices has lost just about all of its merit!!
As you can see by the chart below, The Commercial Traders or Smart Money were massive and I mean massive buyers of equities over the past week. As a matter of fact, their buying was the strongest in over 10 years!!!
These Commercial Investors as we have seen time and time again are always on the right side of the market in equities, so it is very safe to conclude that if the market were to be about to decline 15-20% then we would NOT see such strong buying by these Smart Money Players.
What this tells us is that the August 16th low in the S&P 500 should be the ultimate intermediate term low and that the next major move in the averages will be higher.
I am however, keeping my hedge in place until we complete the short term correction I anticipate, probably in the 4-7% area.
Thursday, September 27, 2007
Equity Market Comment 09/27/2007
Things seem to be setting up nicely for the start of a decline.
While I expect 1 more rally day, the upside in this market is very limited and very near completion on a short term basis at the minimum.
While I expect 1 more rally day, the upside in this market is very limited and very near completion on a short term basis at the minimum.
Wednesday, September 26, 2007
The Evolution of The Blog Continues
As my readership continues to increase almost on a daily basis, I find myself looking for better ways of constructing the blog and offering a wide variety of investment advice.
With this in mind, I will be launching a new feature that will strictly be geared towards Option Trading.
The Option Trades will be of only the highest quality and offer the best risk to reward relationships I can find. All options will also be run through a value model in order to make sure we are not overpaying for the options.
Keep in mind that option trading should only be done with risk capital as these vehicles are highly leveraged. This leverage offers the potential for some incredible returns and I think all of you will be very pleased with the performance.
This new feature should be up and running over the next week and I look forward to any feedback readers may have.
With this in mind, I will be launching a new feature that will strictly be geared towards Option Trading.
The Option Trades will be of only the highest quality and offer the best risk to reward relationships I can find. All options will also be run through a value model in order to make sure we are not overpaying for the options.
Keep in mind that option trading should only be done with risk capital as these vehicles are highly leveraged. This leverage offers the potential for some incredible returns and I think all of you will be very pleased with the performance.
This new feature should be up and running over the next week and I look forward to any feedback readers may have.
Equity Market Comment - 9/27/07
The last hurrah rally for a while looks to have started today.
I anticipate this to be a very short rally maybe as short as a high this Thursday.
From there I continue to expect a decline of some magnitude and the nature of that decline will tell us much about what to expect in the future.
The yearly model calls for a major low in the 10/16 to 11/2 time window and the Seasonal Patterns call for a low in the October 26th area. So if we are to get a larger correction, it could get a bit scary as there would be much price erosion to take place in a relatively short time frame.
Remain 100% hedged in your personal investments and make sure you move to 100% cash in your 401K. Either way, a large or medium sized correction, your move to 100% cash will protect your profits and no taxes either!
Take some time to look at the commodity trading portfolio and the aggressive stock trading portfolio as they have been doing very well. I began to post the results as of August 1 of this year so it is still early, but there are some positions in both portfolios that could offer some incredible returns.
I anticipate this to be a very short rally maybe as short as a high this Thursday.
From there I continue to expect a decline of some magnitude and the nature of that decline will tell us much about what to expect in the future.
The yearly model calls for a major low in the 10/16 to 11/2 time window and the Seasonal Patterns call for a low in the October 26th area. So if we are to get a larger correction, it could get a bit scary as there would be much price erosion to take place in a relatively short time frame.
Remain 100% hedged in your personal investments and make sure you move to 100% cash in your 401K. Either way, a large or medium sized correction, your move to 100% cash will protect your profits and no taxes either!
Take some time to look at the commodity trading portfolio and the aggressive stock trading portfolio as they have been doing very well. I began to post the results as of August 1 of this year so it is still early, but there are some positions in both portfolios that could offer some incredible returns.
ISIL - Keep It On Your Watch List
Although the probabilities are that ISIL will move back down to $30 before it breaks out, it continues to warrant monitoring as once the breakout occurs the move up should be strong and quick.
Cotton - Low Risk Shorting Opportunity
While I have been selling Cotton for about the last 1/3 of this rally, it has reached a very low risk shorting area.
Those of you who have not shorted the cotton are being presented with a great opportunity here.
Those of you who have not shorted the cotton are being presented with a great opportunity here.
A WORTHY PATTERN TO USE ON EVERY STOCK AND EVERY MARKET
The hook pattern on the stochastics indicator is one of the most reliable indicators for short term trading.
I have placed a close up of the pattern so you can see exactly what constitutes that pattern.
You are looking for the line to move below 80 and then turn back up from just below 80. Once the pattern turns down one more time you have a very high probability for a price decline.
This pattern will work in all stocks and commodities and while it is very simple, it is very powerful.
Below, you will see the full chart of Ford with the hook patterns I have spoken of. I have also marked all of the pattern completions with the Blue Line.
The results speak for theirselves.
TNH - Decline in The Near Future
TNH may be setting itself up for a substantial decline that will allow a great entry price.
Much like the equity markets TNH is looking like the lows of mid-august may be breached.
I will be supplying targets for the decline.
If you were one of the lucky ones that bought the stock at $66 when it hit my downside target then I would most definitely recommend you sell the stock now and await another purchase opportunity.
Much like the equity markets TNH is looking like the lows of mid-august may be breached.
I will be supplying targets for the decline.
If you were one of the lucky ones that bought the stock at $66 when it hit my downside target then I would most definitely recommend you sell the stock now and await another purchase opportunity.
A Short Sale For The Conservative Investor
Here is a great short sale opportunity for even the most conservative investor.
Tuesday, September 25, 2007
Confirmation from the Bond Market on Weakness in Equity Prices
The chart of the 10 year note yield looks as if it wants to move lower, which translates into higher bond prices. This chart helps to confirm my theory of a potential mini collapse in stock prices.
I will also be winding down all of my long stock positions in the aggressive trading portfolio as I started today. This will leave only trading positions that will be in line with the prevailing trend.
I will also be winding down all of my long stock positions in the aggressive trading portfolio as I started today. This will leave only trading positions that will be in line with the prevailing trend.
Equity Market Comment 09/25/2007
The equity markets are really starting to take form in here and in quite a clear voice the markets are saying one more rally before the potential mini meltdown.
Keep your hedges in place and dependant upon the nature of the decline we may even institute a short position to capitalize on a sizable intermediate term correction.
Take it one day at a time however and see if what the market is telling us is true.
Keep your hedges in place and dependant upon the nature of the decline we may even institute a short position to capitalize on a sizable intermediate term correction.
Take it one day at a time however and see if what the market is telling us is true.
The daily chart is clearly indicating 1-2 more days of rally to be followed by an intermediate term decline.
Of what magnitude we will have to wait and see, but there is some serious potential for a decent sized decline that perhaps could take out the lows established on August 16th.
Monday, September 24, 2007
Fording Coal - Hedge The Position.... Re-Print
CURRENT CHART
Back on September 24 2007, I issued advice to hedge the FDG position and hedge it in such a way that the dividend would still come our way while synthetically we were out of the stock.
I am not re-posting this as an I told you so, but to re-iterate the downside targets.
FDG has been a good one not only with a stellar dividend, but also some great capital appreciation.
Lately though, the stock has begun to show signs of Distribution and is looking more and more like a 30% correction in the stock price will be in the cards.
This correction does not take anything away from my $60 target for the stock, but it does tell us to buy protective puts as a measure to lock in our profits without selling the stock and still being able to collect the dividend.
I am not re-posting this as an I told you so, but to re-iterate the downside targets.
FDG has been a good one not only with a stellar dividend, but also some great capital appreciation.
Lately though, the stock has begun to show signs of Distribution and is looking more and more like a 30% correction in the stock price will be in the cards.
This correction does not take anything away from my $60 target for the stock, but it does tell us to buy protective puts as a measure to lock in our profits without selling the stock and still being able to collect the dividend.
FORD - Take Your Profits
From the screaming buy point of $7.50 to the current price of $8.48 give us a very nice 13% Gain in about 2 weeks.
Regardless of what the Contract Talks are, the chart of Ford is looking much like it needs to work lower and perhaps test $7.50 again, so take your profits.
Regardless of what the Contract Talks are, the chart of Ford is looking much like it needs to work lower and perhaps test $7.50 again, so take your profits.
Equity Market Comment - 09/24/2007
Remain 100% hedged until we see exactly what the characteristics are of this decline.
I am hopeful that we should only see a partial retracement of the rally from the Mid August lows, especially with all of the institutional support the market has, however, as of late there have been more and more indications of potential further decline.
I am hopeful that we should only see a partial retracement of the rally from the Mid August lows, especially with all of the institutional support the market has, however, as of late there have been more and more indications of potential further decline.
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