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Trade the Bollonger Band Squeeze

Archive through September 24, 2010

Chart Forum » Hilarius' Hall Of Fame » Our Daily Bread » Archive through September 24, 2010

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eblode
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Friday, September 17, 2010 - 04:05 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



MM,

Think I might buy a bottle of Champagne and celebrate one of the best weeks on the market.

Eugenio


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ody
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Friday, September 17, 2010 - 04:11 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Greg Peel's overall analysis

Sorry I did not get around to posting it earlier today. As usual, it's informative and sensible.
-----------------------------
The Overnight Report: Chart Limbo
FNArena News - September 17 2010

By Greg Peel

The Dow closed up 22 points or 0.2% while the S&P was flat at 1124 and the Nasdaq was also flat.

For the third session in a row, Wall Street opened lower (Dow down 50) before struggling back toward the close. Volume was again poor. With mixed US data continuing to roll in, even Wall Street day-traders are struggling to find any impetus in this market.

Last night's data included weekly new jobless claims, which fell 3,000 to 450,000 to continue a recent mildly positive trend. However it is considered that average claims must at least fall to 400,000 before the unemployment rate has a chance of also falling.

The benchmark Philadelphia Fed manufacturing index rose to minus 0.7 this month from minus 7.7 last month. Economists had expected a zero reading (which implies perfectly flat activity). While a positive move is good, a negative result still implies contraction. Again, it shows the US economy is just bungling along the flatline.

The US producer price index rose 0.4% in August with the core rate (ex food & energy) rising 0.1%. This was bang on expectation and provides confirmation that deflation fears are overblown but there is very little in the way of inflation either. On an annual basis, wholesale inflation is running at 3.1% or 1.3% core.

Last night included some out of season profit reports. FedEx, which is seen as a good economic bellwether, announced it had doubled its profit in its first quarter on a year on year basis, which was a positive, but second quarter guidance disappointed analysts, which was a negative. FedEx shares stood still. After the bell, and thus a precursor for tonight's trade, tech giants Oracle and Research in Motion both blew The Street away with their earnings reports. Oracle's shares up up 4.5% in the after-market and RIM's are up 6%. Stand by for a big opening tonight on the Nasdaq.

The 200-day moving average is providing a brick wall for the S&P 500. Crashing through that level is clearly going to take more than mixed data and earnings reports, and will certainly require some conviction volume. If everyone's back at work after their summer vacations now they must either be taking very long lunches or they are playing in some other market altogether.

Forex is the market du jour and the yen stayed relatively steady last night in anticipation of further Bank of Japan intervention. The euro was nevertheless stronger, rising to US$1.31 as Spain once again comfortably put away an auction of sovereign bonds. Meanwhile the US took out its veiled anger at Japan on China, with Treasury Secretary Timothy Geithner again pushing Beijing to revalue the renminbi quickly and meaningfully while stopping short of declaring China a “currency manipulator”. One presumes it's a bit hard to point the finger at Beijing when Tokyo is openly and substantially manipulating its own currency.

Yen intervention has turned attention back on the artificially undervalued renminbi. While the world's three biggest economies (US, EU, Japan) fight a currency battle in order to gain advantage over the same small export customer pool, China (now level pegging with Japan) sails merrily on keeping a close eye on inflation. In one fell swoop, China could revalue the renminbi and affect global inflation/deflation balance but a too swift move would quite simply derail the Chinese miracle. As always, Beijing is taking a “softly-softly” approach.

The US dollar index last night dropped 0.3% to 81.25 while the Aussie was also slightly lower at US$0.9366. After pausing for a session while the BoJ played games, gold resumed its rally last night as the currency of last resort, gaining US$7.30 to US$1275.50/oz and some more blue sky.

A major oil pipeline from Canada to the US is set to reopen shortly after being closed for repairs, and that news was enough to send oil down US$1.45 to US$74.50/bbl. London base metals hardly troubled the scorer. The correlation of movement between stocks and commodities has been so close to 100% in 2010 that one might safely assume they will simply move in lock-step. This lack of variation in markets, driven by simplified investor access to commodity funds and ETFs, worries commentators. Markets need diversification to prevent violent volatility.

The US ten-year bond yield rose 4 basis points to 2.74%. Last night the Treasury released its long term capital flow numbers for July, noting a $61.2bn net inflow as China, Japan and the UK all increased Treasury bond holdings. In the meantime, analysts warn Treasury bond prices are now under pressure as investors switch into the raft of corporate paper now on offer at higher, albeit historically very low, yields.

The Australian market looked rather sick yesterday. However, one needs to take into account the expiry of the September SPI futures which appeared to apply non-market related downward pressure on the physical market as arbitrage positions and hedges were unwound or rolled over. Early weakness then likely sparked a bit of profit-taking as this 4600 level in the ASX 200 equates to 1125 in the S&P 500, ie a tough wall to break.

Last night the SPI Overnight, now trading as the December contract, rose 24 points or 0.5% despite a flat S&P 500. This supports the theory that yesterday's weakness was more of a rollover blip than anything much else.

Tonight in the US sees the August CPI and the fortnightly Michigan Uni consumer confidence measure.







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ody
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Saturday, September 18, 2010 - 03:17 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



General market view

There seems to be a fairly widespread view, now, that current evidence does not suggest a true "double dip", economically. Without paying attention to the fact that this does NOT mean that there will be growth (even if a double dip is indeed avoided), share markets are interpreting what are weakly positive signs, or those which suggest "no further deterioration", as evidence of "more-than-likely improvement". I think that, economically, this reading is largely wrong, as in most countries the so-called recovery has largely slowed, and in fact there are strong pointers suggesting further stagnancy or even decline. However, share markets often follow a kind of logic of their own, and I think this is one of those times.

It may thus well happen that in the short term we'll see continuation of something like a bullish run. The danger, however, is that volumes are not as yet convincing, and the optimists may at any time be refuted; and if THAT were to happen then any rally could very quickly convert into its opposite.

This is not to suggest that it is not possible - or would necessarily be foolish - to take advantage of what for the moment does seem a bullish run, but to point out what its dangers nevertheless are. Sentiment does seem to have turned more positive, but most of the important economic realities have not, and thus share markets remain in a precarious position, with bearishness still a likely event even if a bullish move up were to continue for some time.

Roughly, my thinking on this is reasonably in line with Alan Kohler's below. He produces this Week in View (of which I only cite the beginning) for The Eureka Report.
-----------------------------------
Week in View


By Alan Kohler


About last night
Dow Jones, up 0.1%
S&P 500, up 0.1%
London FTSE, down 0.6%
Frankfurt DAX, down 0.6%
Gold (Comex), up 0.3% to $US1277.50
Oil, down 1.2%

… and last week
All Ords, up 1.8%
S&P 500, up 1.4%
Gold, up 2.5%
Oil, down 3.1%



Global economy

The OECD's leading indicators came out this week giving a pretty clear picture of what's going on:

1. The overall composite index has fallen for three months in a row, so economic growth in the Western world peaked just before the middle of the year.
2. Ten of the 11 OECD countries listed are now having slowdowns; the only one that's not is Russia,
3. Australia is also still expanding, but China is in a definite slowdown.
4. The overall index is down just 0.2% from its April peak, so there is no sign yet of a new global recession, and probably won't be one.

This explains the various market moves we're seeing at the moment, in particular rising share prices and the rising Australian dollar. Global investors are now taking the risk of a global double-dip out of the prices of risk assets.

There's a good chance now that the sharemarket will rally into Christmas and the dollar rally will keep going beyond the mid-90s as investment funds flow into commodities and other risk assets, although there may be a short-term correction, for reasons explained below. The Australian dollar is more affected by global risk sentiment than it is by domestic things like interest rates (which are going up) and political stability (going down). The growth slowdown in China and easing Asian exports generally should stop it going to parity.

That said, another financial crisis is almost guaranteed at some point.

The old theme about the countries of the periphery of Europe sinking while the core nations of Germany and France do well, is back – with a vengeance: Greek, Irish and Portuguese 10-year bond spreads are back almost to their mid-crisis highs because the deteriorating growth is mucking up all their plans to get their budgets back into some kind of shape.

And there's the US, on which more below. I don't know when the next crisis will hit, but when it does it will knock the stuffing out of the market. That's why you need to approach this rally with caution, in my view.


Poor America

A new report out this week from the Census Bureau showed that the poverty rate in the US is now 14.3%, up from 13.8% in 2008: 43.6 million people are living in poverty, which is the largest number since records have been kept (1959). The median income for family households declined 1.8%. Incomes in the midwest fell 2.1%.

The CPI came out last night: 0.3% in August for the second month in a row, reviving talk about deflation. Core inflation is 0.1% and has been that, or less, for nine of the past 10 months, and the year over year inflation rate has been below 1% for nine months running. The last time this happened was during the recession of the early 1960s.

The US is now on the edge of deflation, with falling consumer confidence (according to last night's University of Michigan survey) and 44 million people below the poverty line.

Firms have no pricing power because consumption is falling and that's especially true in services, which are more discretionary than goods.

Meanwhile, back in DC and NYC, where incomes are rising and the world looks a better place, everyone got over-excited about a story sourced from Goldman Sachs that the Federal Reserve would do more QE (no not Queen Elizabeth, Quantitative Easing: printing more money and buying more US Treasury bonds). It's why gold had a spurt to a fresh record high and sharemarkets had a rally, too.

It turned out, however, that the only central bank buying US bonds this week was the Bank of Japan, trying to get the yen down from its 15-year high.

The way this works is that when a central bank buys US dollars to try to push [xxx, Ody] its currency down, the money finds its way into US bonds. Either the central bank buys the bonds directly, or it makes a deposit with the Fed, which eventually buys bonds, or deposits the cash with a bank before moving into bonds later.

Foreign exchange is the most important price in the world, and governments and central banks everywhere are now squarely focused on it, trying to get the best for themselves; that is, the most growth and jobs for their own citizens, even if it's at the expense of those in other countries. But it's a tough gig intervening in the foreign exchange market because it's so darn big. It's like firing a rocket into space. Even the mighty Bank of Japan is weeing in the ocean to some extent.

Anyway, it all comes back to US bonds. If the Fed doesn't print money and buy them, the Bank of Japan or some other central bank trying to manipulate its currency will, including the Reserve Bank of Australia, although it will be shooting a popgun.

At least other central banks use their own existing money to buy US bonds. If, or rather when, the Fed buys bonds to put more liquidity into the system, it will be printing new money to do it, which means more supply of dollars, which means lower value for them, and that we all know what means … a higher gold price. As the US dollar falls, gold rises, night following day. Now central banks are buying gold as well, because they have cottoned on to the fact that having all your reserves in US dollars may not be the best idea in the world if Ben Bernanke is about to get back in the helicopter to start sprinkling new dollars into system again.


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billt
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Saturday, September 18, 2010 - 06:42 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



hi Ody,

Three weeks ago on 27 August, the US Dept of Commerce announced that USA real GDP dropped from 3.7% in the 1st quarter 2010 to 1.6% in the 2nd quarter 2010.

The increase in real GDP in the second quarter primarily reflected positive contributions from
nonresidential fixed investment, personal consumption expenditures, exports, federal government
spending, private inventory investment, and residential fixed investment. Imports, which are a
subtraction in the calculation of GDP, increased.

The deceleration in real GDP in the second quarter primarily reflected a sharp acceleration in
imports and a sharp deceleration in private inventory investment that were partly offset by an upturn in
residential fixed investment, an acceleration in nonresidential fixed investment, an upturn in state and
local government spending, and an acceleration in federal government spending.

I see nothing in the economic data releases which suggests this momentum has changed.


Since then we have had a stream of poor data which suggests a further slowing of the economy including:

Chicago PMI
Construction Spending
Productivity
Unemployment
Industrial Production
Phil Fed
Mich Sentiment
Consumer sentiment
NFIB

This was immediately preceded by other poor data which will affect on Q3 GDP figures including:

Real Personal Income falling
Real Personal Spending slowing
Housing Starts sharply falling
Homes Sales sharply down
Building Permits sharply down
Auto Sales down
Non Defense Shipments falling
ISM Services falling

Any ‘better’ news, made little impact back to Q1 level of activity or sentiment. Many leading economists continue to suggest a significant chance of negative GDP in the coming quarters.

The Market will turn bullish if GDP improves in Q3. How could the Market believe we are going to see a better GDP figure when US Dept of Commerce releases Q3 in November?

I see no evidence as yet, if anything the GDP outlook has got worse..any thoughts Ody?


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ody
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Saturday, September 18, 2010 - 07:09 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Bill - US economy and share market investors

Bill, I have no quarrel with anything you say in your post; indeed, I see the matter as you do, and personally I would not dream of risking my money in the US share market at this point. However, that is because you and I are people who believe in studying the fundamentals of economies and share markets, including individual companies that make up those markets. However, after many years in the market I am also very aware that many share market investors are NOT sound in their economic thinking, and will have a bash at the slightest provocation, especially if they are getting impatient. That is, I think, now happening. There is NO good reason for turning bullish about the fundamentals. But ... the market, or at least enough people in the market (they are still limited in number!), by now must be seen as having come to the view that there "is money to be made", on the assumption (by itself optimistic) that there will be NO second dip (this is now in danger of becoming received wisdom), and that THEREFORE this is a time to buy.

One has to understand the PSYCHOLOGY of markets to explain to oneself how they behave and where they will go - not just what the actual news is, but HOW THE MARKETS INTERPRET IT. By doing that, and combining your assessment with a knowledge of the facts that the market is reacting to as well as overlooking, you can then come to a decision of whether to participate or not.

For me the rise is likely to be too uncertain to jump in, but for someone like Eugenio, who is both guided by market sentiment and to an extent shares it, the upside is what at present predominates. I am sure Eugenio will agree with me: you give him a crack of light, and he will go!!

So ... you will not want to invest yourself, but you may well find yourself watching a market that will go up a bit further yet, on this new-found optimistic basis. We have had this yo-yoing for months now. As I said earlier today: at some point, most likely, the news will be REALLY bad, and the market will take a dive. That is when you and I think there is some logic operating after all. The trouble is, however, that optimists drive market regularly so high that a really big tumble becomes inevitable. These are the people who seek to persuade you first that you are a coward if you don't invest, and who will tell you later, despite your warnings, when once the market takes a plunge, that "noone could see it coming".


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billt
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Sunday, September 19, 2010 - 04:20 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



thanks Ody

Received & Understood!

It was interesting to note that the last three major turning points of the US market in early 2008, early 2009 and early 2010 parallelled the change of momentum in US GDP.



With most economists forecasting, at best, a US GDP rate which may barely be positive for the next four quarters, and many suggesting a return to the 'negative side', it will be a nervous time for those investing 'long', as any poor economic announcement will have the propensity for an immediate significant collapse.

Based upon a 1.0% to 1.6% GDP rate in the coming quarters, some economists have forecast the SPX continuing the current downward trend - so there is a contrary view.



If US GDP turns negative then March 09 lows will be under threat.

...interesting to watch what unfolds

bill


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ody
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Monday, September 20, 2010 - 10:09 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Thanks, Bill, for post 289

It's not that markets don't react to news - they demonstrably do. However, they rarely have a really adequate grasp of what they read, and react selectively to what they see, with their psychology rather than their intellect directing them much of the time. So one constantly needs to know what news they get, and how they are likely to interpret it: the second is at least as important as the first. One has to try to understand them - the would-be or in-the-market investors - better than they understand themselves. Similarly, one has to know and understand what happens in the markets better than the marketeers, and what is likely to unfold.

And the same is true for economies. Without knowledge of market psychology and economic events, and with only technical analysis to guide us, we would seriously in a merely academic vein explore all sorts of possibilities which anyone with true insight into markets and economies would almost immediately reject - a lot of time gets wasted on all sorts of theoretical scenarios which are simply out of tune with the nitty-gritty. It is certainly necessary to keep an eye on charts and what they seem to suggest, but those who don't bother to look at what actually does move, and is likely to move, markets, deny themselves very valuable - to my mind the most essential - knowledge and understanding.

So you are right to think there is a link between economic events and what markets do. The important thing, though, is to realise that you cannot expect most market people to know the economic events, and to understand them, as well as you do, and that they are largely inspired by emotion, many of them. Ultimately they do have to accept economic realities, which do express themselves in market action. The marketeers try to ANTICIPATE what happens, but often do that very badly. Their greed drives them into the market when it is far too early to be there, and conversely prompts them to stay there for far longer than they should. A VAST majority of investors overstays in bull markets, not foreseeing bear markets, and thus see their money lose value. And during bear markets they play too many of the rallies in the belief that the bear market is "over", without concentrating on those rallies which really are SIGNIFICANTLY worth exposing oneself too. Of course, there are always capable short-termers who do very well, but they are a small exception. For most of us, the wisest thing is to work out whether a rally (of any kind) is really likely to "hold" substantially enough for significant exposure of capital, and similarly to be out fast when a deep fall is round the corner or has just started.

All this has worked well for me, at least, since 1983. To think that markets are rational is a big mistake: if they were it wouldn't be true that almost all investors overstay in such a market as we had from 2003 to late 2007. When people like Rudy and I withdrew in mid-December (2% on the late side), we preserved money in a way that very, very few other people did. Similarly, those who did not see there was money to be made (even in a bear market) in 2009 also failed in understanding. As did those who thought that the market would continue to go up during this year. Although it did briefly reach a high level in mid-April, it has mostly range-traded for about a year now. With eonomic news globally mostly bad, it is overall more likely to continue to range-trade or go down, but there will always be periods like the present when the bulls focus only on what they see as "good" news, and therefore take the markets up even though good sense would suggest a different course of action.

(Message edited by Ody on September 20, 2010)


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bridog
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Monday, September 20, 2010 - 10:21 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Eugenio and others interested (Paint?)

CZA intends to delist from the ASX, see the announcement of 14-09-10, page 1 of explanatory statement.

You may wish to take profits based on this . . i sold this morning.

Cheers

Bridog


Old enough to know better . . .

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paint
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Monday, September 20, 2010 - 10:26 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Thanks Bridog,

Got out late last week - very happy with the trade.


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eblode
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Monday, September 20, 2010 - 10:55 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Bridog,


Thanks for the wake up call on CZA. Sold it and bought more EXS.
Once the DOW opens tomorrow on a positive note we shall be flying again.

Eugenio


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paint
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Monday, September 20, 2010 - 11:14 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Eugenio - nice call - many thanks


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ehmu
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Monday, September 20, 2010 - 11:36 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)





Publicly available information is priced in to an equity, don't rely on it to make decisions. This includes fundamental information as well as news.


Some people have better and earlier information than the public. When they act on this information, it always causes abnormal price activity. It is this abnormal price action that is the "clarion call" to the trader that an opportunity has arrived.

Sure, every abnormal price action is not necessarily tradeable, but this is where the work and study come in to play.

News, politics, and corporate illusions (in many forms) only serve to distract you from your decisions, and delay your action to trade. In the worst case, this late information will be the justification that entirely prevents your involvement in a price move.

______________________________


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ody
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Monday, September 20, 2010 - 02:15 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



ehmu: no, this won't wash

This is, to be frank, for the most part an ignorant post, ehmu, though it incorporates some currently fashionable and platitudinous notions.

To begin with, most traders simply do not at any time have much important real information outside what is also available to others. Today, most news travels fast all over the world, and most people who try to be ahead of others read it very quickly. In practice, the supposed "advance" news that you consider to be a "clarion call" is usually sheer speculation and guess work: most often rumour-mongering which it is dangerous to rely on. If, however, it is insider trading, which obviously does frequently occur, then the effect of the action does not constitute a clarion-call at all, but usually shows in a dramatic form that the info has been acted on, and that there is not much action left for the late-comer that was not privy to that really important information.

Just laughable is your notion that, in essence, everything is priced into the market when it is public information. This was the kind of fallacy of the two Nobel prize winners who proved so disastrously wrong. On the contrary, the market does take account of quite a bit of such information, but often does not have all of its at its disposal or misunderstands what it reads. That is how, most often, things get mispriced. For example, even late in 2007 many people in the market didn't have a clue as to what had already been predicted in 2006 and earlier by people like Roubini: the information WAS public, but most didn't know how to find it, and certainly were incapable of judging it.

Similarly when it comes to what you should do in selecting shares. I have time and again - and my record on Our Daily Bread does, as people like cat lady know, bear this out - selected stocks far ahead of most people, and thus obtained way above average results. Was this because I was privy to some special information that enabled me to produce a "clarion call" to others? For my suggestions have quite frequently been taken up by other investors here, usually to their advantage. NO: I did not know anything special, but simply examined shares that few looked at, and applied my brains better than others. No special knowledge was needed: all that I acted on was in the public domain, and merely needed finding and thinking about.

If you go simply by your supposed "clarion calls" I can guarantee you that you will often follow the wrong seeming "signals", and that you are mistaken if you think that such sudden jumps or falls can be relied upon for action. To ignore all financial, economic and newsworthy data, on the other hand, will not get you very far. Most of the time ignorance will not prove bliss, but disaster. Inform yourself, think, and act, using ALL information you can gain access to that may be relevant. Wilfully to neglect study of how the market actually works and why, for example, is extremely unlikely to make you a good investor.

And yes, I DO know what I am talking about, since I have successfully invested since 1983, usually easily outperforming the market by obtaining better results when in it for longer periods (often years), AND by being out of it when most people didn't know when to get out. I suppose that you could say that those who did get out late in 2007 DID provide a very loud and correct clarion-call, but it was not heeded by many.


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eblode
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Monday, September 20, 2010 - 03:03 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Paint,

We're in the money now with EXS!!!!

Eugenio


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ody
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Monday, September 20, 2010 - 03:07 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Eugenio: EXS

At the time of looking this had gone up by 8.75% today. Very good! Just by way of interest, are you going to lock this in or leave it for longer? Pure curiosity on my part!


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eblode
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Monday, September 20, 2010 - 03:19 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Ody,
I plan to keep this stock until it runs up to .80. It has Ivanhoe mines as a new partner together with Soul Patterson. Thy are mining Gold and Copper on the border with Xtrada who dearly wants EXS to expand their own activity, especially when EXS is only 8 miles away from their major extracting plant. I will not be surprised that a takeover bid is in the offing. Join us Ody and partake of the goodies that lay ahead.

Eugenio


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paint
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Monday, September 20, 2010 - 04:07 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Yep - another great call - you are in the purple patch my friend


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paint
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Monday, September 20, 2010 - 04:49 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Housing Market Index (US) due out tonight - interesting to note that June, July, and August have seen the Index fall month on month - although the SPX has risen on each announcement date. May Index of 22 has moved to a reading of 13 on the 16 August.

From the Bloomberg site:

Housing Market Index
Definition
The National Association of Home Builders produces a housing market index based on a survey in which respondents from this organization are asked to rate the general economy and housing market conditions. The housing market index is a weighted average of separate diffusion indexes: present sales of new homes, sale of new homes expected in the next six months, and traffic of prospective buyers in new homes.

Why Investors Care
This report provides a gauge of not only the demand for housing, but the economic momentum. People have to be feeling pretty comfortable and confident in their own financial position to buy a house. Furthermore, this narrow piece of data has a powerful multiplier effect through the economy, and therefore across the markets and your investments. By tracking economic data such as the housing market index, investors can gain specific investment ideas as well as broad guidance for managing a portfolio. Whether the housing market index reflects new home sales or home resales, once a home is sold, it generates revenues for the realtor and the builder. It brings a myriad of consumption opportunities for the buyer. Refrigerators, washers, dryers and furniture are just a few items home buyers might purchase. The economic "ripple effect" can be substantial especially when you think a hundred thousand new households around the country are doing this every month. Since the economic backdrop is the most pervasive influence on financial markets, home sales have a direct bearing on stocks, bonds and commodities. In a more specific sense, trends in the existing home sales data carry valuable clues for the stocks of home builders, mortgage lenders and home furnishings companies.


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ehmu
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Tuesday, September 21, 2010 - 12:53 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)




ody wrote on Monday, September 20, 2010 - 02:15 pm:

NO: I did not know anything special, but simply examined shares that few looked at, and applied my brains better than others. No special knowledge was needed: all that I acted on was in the public domain, and merely needed finding and thinking about.




Seems to me that the special knowledge that you possessed was that the investments were either overpriced or underpriced by the markets and then you timed the entries and exits masterfully.

Well done ody.



_____ n a m a s t e

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ehmu
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Tuesday, September 21, 2010 - 02:23 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Chance of a double Dip, courtesy of John Mauldin and Frontline weekly newsletter.


http://www.2000wave.com/printarticle.asp?id=mwo091710



_____ n a m a s t e

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cat_lady
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Tuesday, September 21, 2010 - 09:49 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Eugenio

EXS

you legend you.

champagne all round I'd say.

cheers

cat lady


Without my morning coffee I might as well be a dog

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paint
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Tuesday, September 21, 2010 - 12:47 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



The big four head into negative territory, BHP & RIO struggle - its all in the mid-caps. The Smalls are now negative. Happy to exit EXS - market looks like it now happy to take a breather. Momentum has fallen.

No doubt EXS now goes into a halt to announce an all cash offer...


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ody
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Tuesday, September 21, 2010 - 02:46 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Eugenio: EXS

This was obviously a great stock to ride from some time in mid-September on. So, well done to you and any others who chose to do that. Now, however, the graph seems to me to suggest that the stock is probably going to fall away ... it seems to have reached *A* peak, anyway, and at the moment it looks to me as being at Weinstein stage 3, with a risk of its either staying there for a while or falling away.

That is just my impression. The alternative would be to see this as a stage of consolidation, before it jumps yet further, but that could take a while. To my superficial mind it seems that the speculative investors who back this kind of stock would normally take it up to around this level, and then sell. (If at a subsequent stage it were low enough while it still contains potential, the next upsurge would then start.)

I'll be interested to learn whether that impression is right!


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eblode
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Tuesday, September 21, 2010 - 03:03 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Ody,
I personally believe that this stock is going to ride up to it's true valuation of it's assets which would be somewhere around .75 to .80 per share. If it is driven to .49 then I'll bail out but frankly I don't believe it will. It's recent report is strong. Their gold price is good, their copper outlook is strong, so only profit takers would be selling such a good asset. Naturally the best of shares surprise. Only this morning I was shocked to see TPM take a 9% fall in spite of a good annual report. But this is the market and anything can happen. I will stay with EXS until they either hit .80 or dumped them below .50. Love plays no part in the equation.

Eugenio


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ody
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Tuesday, September 21, 2010 - 03:04 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



GOLD

By now I am getting convinced that gold is probably going to continue to hold up well as it will support us no matter whether the scenario is for INFLATION, or DEFLATION. Those who worry about inflation (which will certainly be a factor in Australia and a concern to the RBA) would see gold as a classical play: the reasoning is then that inflation devalues money as "the price of everything goes up". To counteract this one buys gold, which, it is felt, will maintain value (and normally it probably would). That is, gold would not be undermined by inflation, but in fact benefit from it as its price would go up.

However, in a two-speed economy deflation would ALSO reduce the value of money if - as seems likely - quantitative easing is maintained in the US and possibly elsewhere: in THAT case, money is devalued because there will be more of it, so that it is worth less, as a "commodity" to own.

Gold would combat BOTH of these evils. It would only "fail", so to speak, if it lost its appeal against BOTH of them. Currently it is very unlikely that the word will not see, in one place or another, either deflation or inflation or both, and likely enough in considerable measure.

So long as ONE is strongly in evidence, those affected will seek the "safety" of gold. If BOTH are a problem, as they probably will be (in Australia one could easily see certain things gaining in value while others lose), then gold is in a good position, as people won't know where else to turn.

But I am quite confident that ETG GOLD is a dangerous medium to play with. If you look at the way that that stock has performed of late it does not look good at all, the reason being that the currency structure spoils the good effect the stock might have: because of our high (mostly rising) dollar, the currency "play" involved turns against us with this stock.

A much simpler and safer way is actually to buy the metal itself in the form of an ingot - a classical method of securing just the metal, without any surrounding complications. With a gold stock such as a good miner one might of course accelerate one's gains if the stock is successful - but one introduces a new dimension. For a straight gold play, there should be nothing that will "beat" gold itself.


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billt
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Tuesday, September 21, 2010 - 06:31 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



hi Ody

ETF GOLD tracks the price of gold in $AUD and the major advantage is that it is simple to trade. Holding the ETF GOLD or Gold Bullion is a choice of security of asset. The actual dollar value is approximately the same.

I feel an investor here in Australia needs to ask the question whether the ‘Aussie Dollar’ will ultimately have the same fiat risk as the ‘Greenback’ over the immediate future. The Australian Economy, National Debt & Deficit is in a completely different ball park currently to the USA. If the strength of the Australian Economy continues perhaps the price of gold in $AUD may continue to drift sideways or push north gradually rather than 'explode' north? However if the currency debasement of the $USD continues (and the printing presses are currently still rolling out usd$1.4 trillion a year), POG could easily go parabolic.

The smaller Gold Miners generally have delivered great results, however they often run counter to the gold price and only consistently head north when the stock market and POG rally simultaneously. Swing trading the miners in the recent 'double' rally is a case in point - fantastic trades. Golden Rim, Ampella, St Barbara, Andean, Integra, Troy, Regis, OceanGold have all done extremely well in the last month, and Ampella, Andean, OceanGold, Regis and Integra have exceeded 100% gain since the start of the year - Ampella has tripled!

Unfortunately for buyers of gold here in Australia, the $AUD will continue to reap the benefit of the commodity boom and the growing differential of exchange rates between Australia and the States. This will have a negative impact on the gold price in $AUD.

If the Australian Economy comes under threat, then it would be the natural choice.

If the whole world implodes, and the fiat system collapses, you will want to have a bundle of bullion, as HSBC Bank – the holder of ETF GOLD reserves may be bankrupt!

Remember that the governments of the world could ‘impose’ a value on the commodity if their fiat currencies come under serious risk. They could also force people to ‘hand over’ all gold bullion – a seizure from the state… it may not work, but they would try it on I'm sure. (I’ll be moored off a deserted island, they have to find me!)

The Gold Bulls will say however:

1. Gold remains ultimate form of payment - No counter party risk
2. Currency debasement - US Dollar losing status as world reserve currency
3. Gold crawling back into the monetary system
4. Negative real rates
5. Falling gold supply vs increased investment demand
6. Gold & Historic averages - gold should be trading above $2500 these days
7. DOW/GOLD ratio points to $5.000+ gold before 2015
8. Gold & US public debt - gold prices required to counter balance all US public debt held in foreign hands exceed the $10.000 mark
9. Large short positions - half of all central bank's gold has been leased into the market. (about 15.000 tons). Covering these short positions is not possible without catapulting gold prices to unimaginable highs.
10. Gold acting as safe haven in times of rising geopolitical tensions

It makes an interesting choice – short term I’ll swing trade the ETF, but it is becoming less appealing as the Australian Economy expands and outperforms the rest of the western world. There are slightly easier and perhaps more productive securities to swing trade, (eg. gold miners on a 'double' rally) but it is a choice for the individual.

If I wanted something to 'Buy & Hold' for 5/10 years and required no income from the asset - it would be the biggest bar of gold bullion I could find. I am not sure there would be a close second choice...certainly not property, equities, or bonds....maybe a chunk of those gold miners stock listed above.

bill


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paint
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Tuesday, September 21, 2010 - 07:44 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hello all,

The Irish bond auction has provided a positive.


Ireland's auction of 1.5 billion euros in debt was completed today, at a lower yield than previously. The issue included both four- and eight- year bonds.

The bid-to-cover was 5.1x, which means there was over 5x the demand as there was supply for the bond issue. This was lower than a previous auction, which had a bid-to-cover of 5.4x according to Bloomberg.

The initial reaction from Ireland's issue was positive, with the spread vs. German bonds shrinking moderately. Credit Default Swap (CDS) spreads also came down, falling to 418 basis points, down 21, according to Markit.



Read more: http://www.businessinsider.com/irish-bond-auction-2010-9?utm_source=feedburner&u tm_medium=feed&utm_campaign=Feed%3A+businessinsider+%28Business+Insider%29&utm_c ontent=Google+International#ixzz109ht31uv


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bridog
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Wednesday, September 22, 2010 - 02:18 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Eugenio,

EXS: We're on the same wavelength. I won't consider it has failed unless 1)it drops below 50c or 2)it doesn't fall that much and goes back up but falls short of 58c.

Have you looked at NXS? I'm currently on this one for the ride. It's no star stock, but has been the subject of takeover rumours which it denied. It's still a good ride but I'm ready to get off at short notice.

Cheers


Old enough to know better . . .

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gdd3
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Wednesday, September 22, 2010 - 02:52 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Brigdog,

Since I'm on-line I will post a chart for 'your' NXS. She looks like she's heading for the next 'increment' level of ~ 46.5c provided 38c isn't breached(red line).



Good luck with her.

Dolphin


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eblode
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Wednesday, September 22, 2010 - 08:07 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Bridog,
I'll just let EXS do it's its own thing and not watch it so closely. Too much attention hour by hour will numb your senses as to when to make your move. If it drops below.49 I'm out otherwise I'll just let it gently climb up the ladder to .80 My decision today is to sell half of DCG or let it keep running. Bought it at 1.69 and it just doesn't seem to run out of puff. As for NXS I've got enough on my plate. Thanks anyway.

Eugenio


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paint
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Wednesday, September 22, 2010 - 08:27 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Good morning all,

I don't discount that EXS has the potential to rally strongly - I am just wary of the weakening market momentum, the put to call buying in the US, bearish divergence on the TMF, SS has clearly rolled over, and the XJO hasn't really convincingly punched through the 200SMA.



I'm reading a great book at the moment titled 'Hedgehogging' - well worth a read. A quote for the book " Liquidity is a coward - it disappears at the first sign of trouble".


Went short BLD yesterday morning. MACD, TMF, SS confirming downside. Although the pattern is similar to a 'Saucer Bottom' it is not confirmed by volume. 200SMA continues to slope down and the recent break above was brief followed by large -ve volume. Looks more like a Stage 3 to me.




Cheers


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ody
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Wednesday, September 22, 2010 - 08:52 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Paint: weakening momentum

As you'll perhaps be aware, I share your view. That is why I said that AT THIS STAGE I'd be a seller of EXS if I had a good profit in it. We clearly are seeing the markets similarly at the moment.


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jaded
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Wednesday, September 22, 2010 - 09:12 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)





yesterday was a 'form' of engulfing candle [a negative].
However this indicator requires confirmation today.
elblode and bridog have fairly close stops.Trigger lower low[?]
EXS has exceeded Sales and Profit Forecast in the Gold Sector however so Could do better.
I can't see why eblode predicts 80cents though.I dislike Round Figure Targets like that.
what about all the punters going for 70 and sell?

Also it's Copper angle may be affected by Xtrata's problems with Mt Isa kiddies being'brain deaded'because of Copper Plant.Will it have to close?


" Hear what you Say...
But see what you Do!"

Sir Zelman Cowen c 1970.

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bridog
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Wednesday, September 22, 2010 - 09:36 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Thanks Dolphin, Paint, Ody & Jaded for your thoughts.

I have an itchy trigger finger on the sell button for a number of stocks:

AVO, BPT, BHP, LEI, MTS, MND, ORI, RHC, TOL, WES, WHC.

They are nearly all quality companies, but I have a feeling I'll lose some in the next day or two, if not today.

Like Paint and others, I'm expecting a market pullback sometime in the next 30 days or so.

Cheers


Old enough to know better . . .

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bridog
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Wednesday, September 22, 2010 - 09:56 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Eugenio,

DCG: I bought in at $1.72 and it has been a great ride.

It's not on my trigger sell list, but is showing signs of toppiness and i'll be watching it closely too.

Cheers


Old enough to know better . . .

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paint
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Wednesday, September 22, 2010 - 11:36 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Good morning all,

A couple of points of interest / for discussion:

PIIGS recent bond auction success: The eurozone sovereign bond market is distorted because the ECB, in a big switch of policy after the Greek crisis, agreed to stand by as a buyer of last resort of government debt bonds held by institutions needing cash.
Although spreads narrowed last night - is this just a temporary move? This will be an interesting space to watch over the next week.

Recent spate of US M&A activity, buybacks and dividends supported via cheap debt. This really doesn't do much for overall productivity growth and employment in my mind.

Last night's great Housing Starts figures - is this really a positive? There were 4 million homes listed with brokers for sale as of July. It would take a record 12.5 months for those properties to be sold at that month’s sales pace, according to the Chicago- based Realtors group.

Cheers


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ody
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Wednesday, September 22, 2010 - 11:41 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Interest rates - and attendant risks

To me all the signs are that in our inflation-prone economy a rate rise is imminent rather than distant, and I agree with those who say that it might well be in October, i.e. fairly soon.

As an owner of hybrids I am happy, as they move up along with interest rates. For someone with a FIXED yield on interest rate securities any rate rise is of course less good (depending on how high that rate is). In general, interest rate securities are performing strongly: another clear sign, not only of what people think will happen to rates, but of a likely fall in prices for shares (or an inability for them to keep on rising).

The capital gain I've made on my interest securities has never been as high as it is right now: a clear pointer, along with the general outlook for and performance of gold, that people are once again becoming more distrustful of share markets. The housing market will of course also be affected by any rate rise.

Hence: if you are in the share market, it would be wise not to expect a lot more upside after the little rally we have had. With the notable exception of April 15th, the market has for long now traded within a band, and it is once again at the upper end of what that band has been, especially in recent months.

We'd have to see a clear and decisive break-through in the index beyond its two recent peaks for it to move up convincingly. This does not look like coming.
------
On bonds: on the whole there is more potential upside in corporate bonds than government bonds, as that latter category tends to get overbought. Though such bonds will generally not fall over, there is thus a risk of capital loss if you buy too high, while you get a small yield. This problem arises from a "flight to safety". This matter is worth watching in corporate bonds too, but on the whole they have more future potential.

The Eureka Report had an excellent report on Rabo Bank and its great bond. Rabo Bank is one of the very best and safest banks anywhere, and the bond is excellent. Alas, it does cost $500,000, which is not negligible.

Rabo Bank also offers good deposits, however, for much lower amounts. They are consistently among the safest and highest-yielding at the same time. Obviously, in this case it is yield only that one will get. The corporate bond does offer a slight capital gain prospect, and the yield is big.


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jaded
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Wednesday, September 22, 2010 - 11:45 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Clover back when it floated[99] had 150mil shares on issue.
Now it has 165mil
ie it hasn't been diluted over the decade and COULD achieve that All Time High Market Capitalisation again.[see below]

Especially now it has a fine tuned business plan.

Yes there are Liquidity 'problems' but really only if one insists on $50 grand parcels
Anyhow In with 4grand$$ 30c looking to accumulate up to $10000ish.

Think Materials have peaked and subject to World/Chinese Economics?
CLV is Neutrapseuticals-new word for nutrition 'drugs'.Suitable Dip Ride?

new year high

Ambition?



" Hear what you Say...
But see what you Do!"

Sir Zelman Cowen c 1970.

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eblode
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Wednesday, September 22, 2010 - 12:08 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Cat Lady,

I bought into our old friend GXY at around 1.23. Let's hope history repeats itself.

Eugenio


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paint
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Wednesday, September 22, 2010 - 01:27 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Jaded - CLV looks good - not much volume on the sell-side. I'll watch this one.

MMX forming a bullish pennant - ticks all the boxes, although the 200SMA has flattened and the PA is stuck under the weighted 30 week MA. Short term SS looks good and the 14day SS hasn't rolled over. I guess wait for the break over the pennant resistance and the 30 week. Pole length 33%.




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eblode
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Wednesday, September 22, 2010 - 01:30 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Bridog,

Check this little beauty out. Bought a swag of CDA. Even Ody can't fault this one. lol.

Eugenio


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bridog
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Thursday, September 23, 2010 - 12:56 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Eugenio,

Thanks for the tip on CDA, didn't see it until tonight.
I dunno how you find these things!

I'm not really in a buying mode just now, more watching my portfolio to cull non performers. Got rid of AVO and LEI today. Most of the others in my sell list got a reprieve when prices went up.

I've been watching an old favourite of yours, MQG. It seems to be making early comeback signs. If its been off your radar recently you may want to have a look again.

Cheers


Old enough to know better . . .

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rdumas
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Thursday, September 23, 2010 - 11:59 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hey Eugenio,

Not sure if you are still in GXY but the chart below does not look good for the near term future.




I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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eblode
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Thursday, September 23, 2010 - 01:09 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Rudy,
Yes, I'm still holding GXY.
Will look at it again and be prepared to bail out on your charting prophecy.
Thanks, being forewarned is forewarned.

Eugenio


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peterloh
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Thursday, September 23, 2010 - 01:47 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Eugenio,

There is a share placement at $1.25c on 36 million shares, so profit taking is very likely once relisted, at least for the short term.

Cheers

Peter


-------------------------------------------------
Disclaimer: Please note that comments made in this column is mainly for the interpretation of charts in technical analysis. It is not made in my professional capacity and should not be taken as advice.In my professional capacity I am only allowed to give advice on certain managed funds authorised by my license dealer.Any share discuss is for general interest and should not be relied on to make an investment decision.It is likely that I may own the shares that we discussed as a trade or as an investment. Please consult your stock broker or financial adviser in regard to your personal situation.

The views expressed here contain information derived from public available sources that has not been independently verified.No representation or warranty is made as to the accuracy, completeness or reliability of the information.Any forward looking information in this representation has been prepared on the basis of a number of assumptions which may prove to be incorrect.It should not be relied upon as a recommendation or forecast by the writer.

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billt
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Friday, September 24, 2010 - 02:09 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



'All-in' on my x3 bear shorts FAZ & TZA, took positions on the bullish cross on the 15 minute...potential of an extended wave iii tonight:




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ody
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Friday, September 24, 2010 - 04:01 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



XAO faltering

Just as was to be expected, the market (XAO) did stage another little rally, but it only briefly touched 4700 a few days ago; seems to find it impossible to stay above that; and, although up and down during the day, is now well below that level. It will probably actually feel more comfy at around 4600+. For it CLEARLY an ONGOINGLY to go beyond 4700 it seems to need the kind of volume and courage that we are not seeing. On the whole, 4200-4600 seems more like the ongoing band.


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sway
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Friday, September 24, 2010 - 04:30 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



billt

All I see is a couple of downtrends.

TAZ

faz

Why would you buy into a downtrend?

Cheers
Sway


This is not a recommendation or advice. As they say .... DYOR.

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peterloh
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Friday, September 24, 2010 - 05:02 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Eugenio,

I was referring to GRY, must have confused you.







-------------------------------------------------
Disclaimer: Please note that comments made in this column is mainly for the interpretation of charts in technical analysis. It is not made in my professional capacity and should not be taken as advice.In my professional capacity I am only allowed to give advice on certain managed funds authorised by my license dealer.Any share discuss is for general interest and should not be relied on to make an investment decision.It is likely that I may own the shares that we discussed as a trade or as an investment. Please consult your stock broker or financial adviser in regard to your personal situation.

The views expressed here contain information derived from public available sources that has not been independently verified.No representation or warranty is made as to the accuracy, completeness or reliability of the information.Any forward looking information in this representation has been prepared on the basis of a number of assumptions which may prove to be incorrect.It should not be relied upon as a recommendation or forecast by the writer.

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billt
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Friday, September 24, 2010 - 06:25 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Sway

I swing trade the US markets, concentrating on Small Caps (RUT) & Financials (RIFIN), longing and shorting the indexes through x3 bull & x3 bear etfs. These sectors of the USA market lead the markets up and lead them down, and they both generally outperform the SPX & DOW. The ETFs are turbo charged x3 so it gives you some velocity - they can often outperform the SPX x5, as TNA has just done.

In the September Rally my normal main trade TNA (x3 bull RUT) rallied 49%. FAS (x3 bull RIFIN) rallied 39%. Volume through each of these ETF's are about usd$1 billion/day - lots of liquidity. Check out www.direxionshares.com

I now have gone long the x3 inverse bear etfs of the same indices, TZA & FAZ. These ETF’s have rallied 11% & 17% in three days, since the high was put in. I feel the US markets are now in a pull back which may have some strength. I swing trade in any event, and keep stops tight.

My trading style is similar to a guy in California – his website is http://thechartpatterntrader.com/ - if you want to watch his latest webcasts. He trades these etfs as well. He has a much more pessimistic view than I on the future of the US economy in the short term (but he may be right!) - so I try to take a more balanced/impartial view and simply trade what is in front of me...

Not the preferred option for most - but it works for me! TNA scored +49% in the September rally against +10% for SPX. Not too many trades beat that. TZA does the same in the pull backs. The thing is - TNA & TZA are consistent performers...

bill

 
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