BUY Revlon For A Potential Killer Move!!

Revlon is a BUY in the $1.19 - $1.25 area, with a very close stop at $1.15 on a close only.

GMTN

Gander Mountain has once again come through in a pinch for us.

I continue to look for the stock to challenge $22 over the next 12 months.
However on a short term basis is you want to tale the 10% plus profit and buy back later after the market corrects, there is nothing wrong with that either.

I do stress however that this is for short term traders and those who are in it for the long term should continue to hold the position.

Sugar - Get Ready to Ride

Sugar appears to have finally put in a low of some substance.

The current wedge that is forming on the daily chart indicates that it wants
to move lower on an intermediate term basis.

We will be buyers on the weakness in the 8.90 to 9.20 area!

Corn has Rewarded Us Well

The question remains.... Is the Decline in Corn Over?.... The Answer is NO!!

However, it is very close to the point of covering our shorts. We have some massive profits and another 8-10 cent rally and we will be forced to cover, so keep your stops tight.

The True Measure Of Inflation - A Little Know Secret

Keep this information in your battle chest as there are very few who know what I am about to share with you.

INFLATION IS ONLY MEASURED AND PREDICTED BY THE MONETARY BASE.

Don't waste your time with Core PPI or Core CPI or PPI Ex this and that and the other.
It is useless!!

The true measure of pricing pressures is the change and growth in the monetary base.
This is an all encompassing piece of data and covers everything you could possibly need to know
about the liquidity of the economy.

So it is as simple as this. Compare the Monetary Base of the Last 2 Weeks to the most recent 2 Weeks and multiply by 26. This is one stat. Now here is the most reliable and the toughest.
Take the current Monetary Base and compare it to the Monetary Base from a year ago and Viola, you have the inflation rate. You will be the envy of economists and wall street when you see how accurate you are with these numbers, but keep the secret to yourself.

By the Way, the current reading of the monetary base is a very tame 1.73% yearly inflation rate, so all the doomsday advocates who think the inflation rate is going to spiral out of control are way off the mark and you are smart enough to know it!! So use it to your advantage and know that once this market corrects on an intermediate term basis and the sky is falling crowd is out in force, then it will be time to purchase quality equities and quality leaps.

Caution Continues to Be The Word

The Moving Average on the Three Line Break sentiment chart has clearly rolled over and we all know what follows such an event.

As hard as it may seem right now, you must resist the temptation to increase your equity exposure. If anything a reduction in equities is the most prudent course.

Weaker and Weaker Equities Become

There is much fanfare about the huge rally today, as the markets posted their biggest one day rally in over 4 years.

Now had this come after a prolonged contraction in prices then I would be very excited about the prospects. The fact remains however that equities are in a very dangerous position on the intermediate term and the longer it takes to move lower and get rid of the many intermediate term excesses then the more painful the decline will become.

The chart below shows yet another negative divergence in the equity markets with the S&P 500 moving to a new high, but the cumulative Advance to Declines does not confirm.

The most telling momentum picture that shows the weakness of this market is the Summation Index, which has been making lower highs for better than a year now as the market continues higher. The reason I say this is the most telling sign is the fact that this anomaly is ALWAYS rectified and this time is no different.

Keep your hedge in place and do not get sucked into this blow off rally, it will only bring your portfolio pain in the near future.

Fording Coal

While the long term trend on Fording remains bullish, it does appear to be in need of a correction, with 25 1/2 - 27 being the most logical targets.

Correlation

The correlation of the 10 Year T Note to the Price of Transportation stocks is uncanny.

Take a look at this chart and you will see why it pays the heed its warning!

Gander Mountain is Ready To Run!!

Gander Mountain looks about ready to launch its final assault upwards to the $22-$24 price range. Keep a close stop just below the most recent lows and only on a closing basis.

Wild Swings Tell A Story

The most recent price action over the last 10 days or so says much about the current state of affairs in the equity markets.

It is indicative of these markets to have wild swings in a trend change process and that is exactly what is taking place now.

I remain 100% hedged against a decline and it certainly is not to late to establish a hedge as there remains a possibility of a 15% decline.

Commodity Based Stocks

I had posted before about the commodity based stocks, especially the steels and how they are very prone to a sharp decline.

I thought it only fitting to repeat the warning as even though they have declined some, they still have a long ways to go.

Sugar - Finally an Early Bull Market Taking Form

Patience at most times is our greatest weapon.

Sugar has been no exception!

Potential Huge Rally in the Offing so begin to establish a line on any price weakness!

Intermediate Term Weakness/Long Term Undervalued

Although on an Intermediate Term basis, equities have begun a state of consolidation and decline (perhaps 10%), the weekly chart below shows why long term investors need to remain Ultra Bullish.

Notice that even though most equity indexes are very near their all time highs, the commercial traders (blue line) remain heavy heavy purchasers of stocks.

So when this correction has run its course, all I can say is LOAD UP on quality equities and if you are aggressive, put together a LEAPS portfolio.

When The Commercials Speak We HAVE TO LISTEN!

The Grains have reached a pivotal Technical point on the weekly chart and should prove to work sharply lower.

It appears that the all out second leg and collapse of grain prices is upon us.

The commercial traders remain steadfastly bearish and the big boys continue to forecast lower grain prices. LISTEN TO THE PEOPLE WHO KNOW!!

Steer Clear of Crude, Unless You SELL IT SHORT!!

Crude Oil, while frustrating at times, continues to show strong evidence of remaining in its bear market phase. It is safe to say that $80 was the secular bull market peak and currently crude is very close to starting its next bear market leg down.

Notice on the commercial data that the big boys have been heavy sellers and the not so sharp money has been buying up all the crude they can in order to get in on $100 crude prices that will NEVER come.

This market is doomed and will catch the vast majority off guard when it finally collapses.

Get Ready To Pounce!

Lumber has proven to me that it has reversed its long term trend down and has begun a new uptrend.

The price should continue to pullback short term, but look to buy in the 258-266.5 area.

When Will Crude Finally Break Matt, You Moron!!

I know, I know!

Crude Oil just keeps hanging on in price and seems to refuse to regress back to the mean!

Take heart, as all good things come to an end and the longer crude refuses to answer the call of the underlying fundamentals, then the harder the price will get hit when the wrath is bestowed upon it.

Long term I still look for $35 to$40 Crude.

The Second Collapse in Corn Prices

If you missed the first leg down of the bear market in corn, here is another chance to jump on board for the second leg down.

This move down should be quite dynamic and could offer exponentially better profits than the first!

While I certainly cannot rule out another test of the lows in IndyMac, the stock is showing some good signs of launching another move higher.

Long Term the stock has put in a major secular low, so any purchases in this area will be paid off extremely well over the next 3-5 years!!