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Archive through September 30, 2010

Chart Forum » Hilarius' Hall Of Fame » Our Daily Bread » Archive through September 30, 2010

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sway
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Username: sway

Post Number: 643
Registered: 12-2005

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Friday, September 24, 2010 - 10:41 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

A couple of questions:

1 Which broker do you deal with?

2. I'm interested how you manage your portfolio risk, position sizing etc. Where do you have your stops placed on those leveraged ETFs? With the S&P futures pointing to a 0.5% rise as I type this, presumably you will be facing a 1.5% drop at the open.

I can't see much difference between buying a 3X leveraged ETF and selling say 30 S&P500 contracts instead of 10. Am I missing something?

Cheers
Sway


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

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sway
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Username: sway

Post Number: 644
Registered: 12-2005

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Friday, September 24, 2010 - 11:13 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)



Looks like it's getting worse for your turbos billt. I suppose by some weird logic you could short sell a 3X inverse ETF but there are probably more straight forward ways of making money.

Sway

(Message edited by sway on September 24, 2010)







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

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ehmu
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Username: ehmu

Post Number: 12
Registered: 08-2010

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Saturday, September 25, 2010 - 03:56 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)



Why don't you just post your trades sway, or your opinions about the markets.

You won't get to the top of the heap by criticizing, condemning and complaining about others.

Though taunting may be the national past time for males under 17, it's neither productive nor welcome here.



_____ n a m a s t e

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billt
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Username: billt

Post Number: 323
Registered: 02-2010

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Saturday, September 25, 2010 - 07:24 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)



Stopped out right on my entry level, but repositioned at the Double Top...

Thanks ehmu for your comments, sometimes you give people the benefit of the doubt - trying to helpful - but all you get is ongoing abuse! This idiot is a serial offender...

Next time I'll ignore the pest - like so may others here and on other Threads already do.

Unfortunately this clown pushes good people away from posting, and that is the consequence of not dealing with this idiot earlier.

Colin seems not to want to deal with this sort of behaviour, so IC will loose more clients by protecting the nonsense of one bizarre, unstable, and obviously challenged individual...


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baysider
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Username: baysider

Post Number: 445
Registered: 06-2009

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Saturday, September 25, 2010 - 07:44 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)



MM

Are you still reading Charlie Aitken? My subscription ran out last week but I have to give it to the guy he did go 'all in' about 4 weeks ago and suggested the AU$ would be heading for parity.
I ignored his 'hype' as Ody would describe it and followed the general consensus of bearishness so staying out of the market in large part though since we cleared 4600 two weeks ago ago I have been putting some cash back into stocks, DML, COK (huge volume on Friday after the close) Eugenio's EXS, AGO, ABY and GRR yesterday.
What do you make of the situation and Aitken's analysis? If we follow the US +2% rise looks like we'll be making fresh highs and breakout from this range on Monday.


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sway
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Username: sway

Post Number: 645
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Saturday, September 25, 2010 - 08:35 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)



I asked a couple of reasonable questions. The later post was actually supposed to be sympathetic to billt's position ("all-in" on leveraged short position with a market turning 1.5% against him). If it sounded like a gloat then it wasn't meant that way. The comment about shorting a 3X bear ETF was merely to create a bit of a mental challenge.

Good luck with trying to pick the top. The EW practitioners here on IC have been confidently saying this is it for months. One day they will be right. It's not much different to the dangers you've heard about "Bottom fishing", "catching a falling knife" etc, only you have to turn the chart upside down.

Most of the IC bears seem to be that way not through their own reasoned logic, but because they read and listen to Prechter, Roubini, Faber etc and constantly search for more negative sentiment to reinforce their decision.

I have posted some of my positions before, but since you asked I am currently in GOLD, MCE, PNA, PRU, SDL in my trading account and BHP, GMG, GOLD, MCE, PNA, PRU and SLF in my SMSF account. My style is a mixture of Weinstein, Allan Hull, Darryl Guppy, Colin Nicholson and a touch of Roger Montgomery. Find an existing trend or one about to start. Manage your position sizing and capital at risk.

Cheers
Sway


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

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ody
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Username: ody

Post Number: 5387
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Saturday, September 25, 2010 - 09:57 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)



Markets going sideways

Far more often than most realise, markets can, and do, for long periods go in essence sideways. The present market is very much of that nature, and one that because it goes both up AND down will always provoke very strong comments from both bears and bulls looking for something like a decisive direction. Most people cannot be agnostics, but need the emotional security provided by the "knowledge" that there is a god or that there isn't. We like certainty, and action, and often are afraid of missing out on upside or downside we'd dearly like to be able to predict with firmness.

There are bound to be strong opinions on where the markets will go, when they are moving within a range, and slight changes in pattern often are hailed as setting a new trend. Sometimes there will indeed be either a fall or a rise which is a bit bigger, as we saw in the one significant rise, during the last year, viz. that which led to the mid-April high. But the overall direction has in essence been sideways since September/October 2009 when I withdrew the fairly substantial sum I had by that time made significant money on during that year. In 2009, we DID have a rise it would have been really silly not to take part in.

Though I was too early, and mid-April would have been a better time to leave, I did make good money during a really strong period: the 2010 mid-April peak was just a fairly significant exception in what has otherwise been a range-trading market.

Baysider: I do not think that Aitken is always wrong. But remember that there are also times when he very clearly IS wrong, and you have, I think, possibly already missed the best part of this latest (small) rally, about which he was obviously right. But do remember that the Australian market has not shown itself positive in recent days.

In essence, I believe you are allowing yourself to be guided by the 2%+ jump on Wall Street, and by what HAS been happening for much of the recent past. Could I be right? Wall Street had, admittedly, had a number of good days, but was faltering until overnight (our time) it rose. And our own market during the second half of this week has clearly been faltering.

I can't say that Wall Street's overnight rise impresses me as indicative of anything conclusive, particularly as our market had actually been weakening during the last few days. And I add that Americans, in moving their market up at a time like this, simply do not to my mind have the credentials needed, in understanding their own situation, to persuade me that they will generate anything like a bull market. Volumes, for one thing, have been insufficient of late to make a broad-based and solid rally likely.

And I was both amused and repelled by what Bernanke had to say: a marked incompetent, to my mind, who is regularly very wrong, but to whom Americans listen as though he is a proven guru. On the contrary, he has been instrumental in letting this crisis get worse and worse, as far as fundamentals - and increasingly also sentiment - are concerned.

Below is what he had to say. Should we, after all that has happened, believe that he is, intellectually, on the right track? I shouldn't have thought so, and I think the impact HE will make, if positive, is likely to be short-lived, even on markets that "would like to go up". So I would have thought that you won't have long to make a profit, coming in at this time.

I do NOT deny that in various ways short-term traders can, of course, make profits, whether the markets go up or down, often even if the move is fairly small. But whether after the recent rise we are actually right to anticipate yet more of the same?? Australians certainly weren't doing so at the end of this week. Still, I am largely agnostic, at present, as far as various minor variations are concerned. I am IN GENERAL not bullish, but at present think range-trading may well go on for a while yet, with a reasonable chance of a fall increasing the more while it becomes yet more obvious that the world economy is not improving enough.

What I do feel I need to affirm is that for the most part markets have not actually produced significant rallies for something like a year, and that - I don't think that many doubt this - the GFC is such that not many actually really believe that we are in recovery, economically, in the global economy and share markets at large. So both the very real economic facts and attitudes toward them are likely to keep matters in check. Large rises are simply improbable, under circumstances like these.

Anyway, each to his own. I can't resist quoting Bernanke, though. Having spent my working life as an academic, I'd have to say that to my mind what he produces here is a typical example of spurious, deceptive, out-of-touch academic bulldust (the software here won't allow me a less genteel word):
----------------------------------------

Bernanke makes case amid criticism
aap

On Saturday 25 September 2010, 8:23

Fed chief Ben Bernanke made a spirited apology for economics on Friday, defending a discipline derided for failing to predict the financial crisis and accused of being numb to Americans' plight.

Speaking to a group of his former colleagues at Princeton University, the chairman of the Federal Reserve said economics was not broken despite failures in the run-up to worst economic crisis since the Great Depression.

"The episode as a whole has not been kind to the reputation of economic and economists, and understandably so," he said.

"Almost universally, economists failed to predict the nature, timing, or severity of the crisis," he told a conference at the New Jersey university where he was once a tenured professor.

But, he added: "I don't think the crisis by any means requires us to rethink economics and finance from the ground up."

The Fed chair, who is one of world's foremost experts on the economics of the Great Depression, said it was economic management and analysis, not theory that had failed.

He admitted the recession "did reveal important shortcomings" in economic modelling at times of extreme events and the "understanding of certain aspects of the interaction of financial markets, institutions, and the economy as a whole."

This week economists at the National Bureau of Economic Research were widely ridiculed for declaring that the US recession ended in June 2009, while millions of Americans are still out of work and struggling to make ends meet.
---------------------------------------------

Comment: "A case?" I'd say this is typical academic talk, and notably of an American kind. Even after things have manifestly not developed the way you have been arguing they would, you "strategically" still don't REALLY concede that you were disastrously wrong. NO: your "theory" holds, even if the facts went the other way! Note how he minimises the fact that SEVERAL much better economists picked the GFC well in advance, and have continued to analyse it well while it has been developing further, often attacking his policies. He is protecting, as best he can, his own reputation, so he is not going to praise his intellectual adversaries, and, as it has turned out, superiors.

(Message edited by Ody on September 25, 2010)


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colin_twiggs
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Saturday, September 25, 2010 - 10:39 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)



Billt,

We have eliminated the worst of the aggression/antagonism on this forum, along with a few members, but cannot stamp out needling remarks altogether -- without becoming over-bearing. Readers can play their part by telling anyone who posts a facetious comment to "grow up!"


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ody
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Saturday, September 25, 2010 - 10:47 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)



**Other matters than the Australian share markets at this point**

As I said, I don't see share markets in general going up much, but there are a number of important points to be considered in addition.

So far, one problem for our market has been that it has chosen to be negativistic as though it has similar difficulties as those of the US.

Given problems in e.g. Europe, our market's attitude is understandable.

However, we must ask ourselves such things as: Why is our dollar going up? Why is gold going up?

I think the answer has to be that our economy is actually not going badly. We are insufficiently diversified, but resources - notably gold - are du jour.

A few days ago, I argued that gold - in the form of the metal or shares in good miners, *not* ETF GOLD (because of currency exchange problems) - is likely to go UP as both deflation AND inflation will push the price of gold that way (indeed, are doing).

Australia is a gold country, and this will help our standing internationally while America further devalues its own country. The US will print more money, and probably lots of it: it will HAVE to be a lot to get that dollar down. Without that happening there will be no "easing". The Americans do need a significant devaluation, and "quantitative easing" is designed to help bring that about.

Result: not only gold will go up, but also the Australian dollar - yet further. INTEREST RATES WILL ALSO DRIVE OUR DOLLAR YET HIGHER.

But this - the interrelationship of the Australian dollar and gold, both running against the US dollar - is where much of the action is occurring, at the moment: NOT, or at least not on a wide scale, in share markets.

IF this reasoning is correct, then ULTIMATELY of course the Australian share market WILL "decouple". But I'd not bet on that JUST NOW. I'd bet on the US$ falling, the Aussie dollar rising, and gold also rising - probably best bought as an ingot, or else shares in the very best Australian mines. These entities - gold (also silver) and the strongest currencies tied to gold, like our own - will probably prove the winners in the short to medium term.

I am already well into the Australian dollar, having further exposed myself to hybrids that will rise if interest rates here rise, as I feel 90% certain they will do. I now need to find a good exposure to gold.

ANYONE WHO DARE PREDICT WHICH AUSTRALIAN GOLD MINES WILL BE INHERENTLY PROFITABLE - NOT SPECULATIVE BUSINESSES, BUT PROVEN PRODUCERS? I'd be happy with suggestions. Even the idea of a bar of gold doesn't really greatly turn me on. It may be sensible to buy two or three stocks, I imagine??


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colin_twiggs
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Saturday, September 25, 2010 - 11:03 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)



Sway,

Constructive criticism and opposing viewpoints are encouraged, but are only meaningful if posted prior to an event. There is no benefit to you or others in playing Harry Hindsight.


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baysider
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Username: baysider

Post Number: 446
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Saturday, September 25, 2010 - 12:06 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

Rest assured I always read your input with interest as I know how careful you are not to lose capital which must be the start point for any investor or trader. I look forward to the day when you become more bullish and for now I certainly don't disagree with your view of the current situation however as has been stated many times here markets don't always follow fundamental logic!
The markets have recently been trading through the overhead resistance, with relatively minor pullbacks and now appear set to move further clear of the key resistance zones, for a time at least. I would not say that I am unduly biased by the 2% overnight move as I have been putting on trades for the last two weeks. I'm happy to see the move up of course because I'm long only! DML for instance has a paper gain of 15% in that time and with COK I'm entitled to participate in a capital raising at a 20% discount to the current price so I'm happy with both those trades. The others are +- minor amounts at present.

I also note that Rudy now favours the more bullish scenario of his two EW options joining with the other 3M's which also gives me some confidence to trade this rally, possibly until the New Year - we'll see what unfolds.

I have to say Aitken has been pretty accurate with his forecasts this year, bearish in the first half turning bullish since July/August. He now sees the XJO moving into a new range of 4600-5000. I don't believe he's predicting a new bull market, just a bullish phase for now.

Good to hear from you and keep up your commentary.

I shall now enjoy the AFL grand final and hope my team St Kilda give us the win all neutrals must surely be behind. Go Saints!

PS For the gamblers out there because there's so many feral one eyed Collingwood fans out there backing their team with cash they probably haven't got that I believe the betting market is grossly distorted in St Kilda's favour. So many bets have been placed on the Pies that you can easily get 3:1 for a Saints win which they're more than capable of. I only bet once or twice a year and today might just be the day!


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billt
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Sunday, September 26, 2010 - 10:10 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)



Hi Ody

Aussie Gold Miners

If you are thinking of looking at some Aussie Gold Miners here is my list.

It is difficult not to have NCM Newcrest in your portfolio. As you know, after the acquisition of Lihir, it is now one of the largest gold miners in the world - an international blue chip.

There are not many other aussie gold miners producing a profit and dividend, so perhaps Ody if you are looking for 2 to 3 stocks, you may need to do your homework and see what fits your criteria.

AND Andean Resources was my preferred small cap miner, however recent M&A activity puts this stock into a holding pattern for now - but it should be followed. Fantastic reserves with a very low cost base makes this miner appealing. AND must have one of the best three/five year charts going around.

I trade some of the smaller miners: SBM St Barbara, KCN Kingsgate, TRY Troy, & MML Medusa. These stocks have traded well in the current POG & XJO rally:

SBM St Barbara 53%
KCN Kingsgate 31%
TRY Troy 26%
MML Medusa 25%

AVO Avoca & EAU Eldorado are often on the radar too.

A few other smaller cap miners that have outperformed in the current rally, but perhaps may not fit your criteria:

GMR Golden Rim 124%
AMX Ampella 74%
IGR Integra 28%
OGC OceanaGold 31%
PRU Perseus 22%

NCM, AND, SBM, KCN, TRY & MML are my top six!

cheers

Bill


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ehmu
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Monday, September 27, 2010 - 05:22 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)



An article by John Mauldin, a respected international economist.

He calls his article ---pushing on a string, in reference to further quantitative easing.

good discussion regarding inflation/deflation and currency devaluation for the purpose of fighting deflation (wink, nod).

http://www.frontlinethoughts.com/pdf/mwo092410.pdf



_____ n a m a s t e

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market_mad
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Monday, September 27, 2010 - 01:31 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 Baysider,

Good to hear from you! First things first - I did punt on St Kilda on the weekend through Sportsbet and was delighted to see that they had paid out half the dividend even though it was a draw - can't imagine what it must have been like for a true supporter like yourself to watch - fascinating final and right down to the wire - great game.

I still follow Aitken and he was indeed bullish going back a few weeks ago now. I just feel that although he has been right thus far, this rally is possibly a little stretched at present so I'm looking for a small pullback over the coming week to around 4570 possibly to enter into some stocks.

If however, we trade through 4720 area this week then I think we are heading up to 5000 pretty quick. So, I'm prepared to wait to see what direction we take short term before committing - a break and hold above the 4720 level will see me enter into stocks.

Not convinced about the AUD trading at parity if at all but not for long...

Cheers
MM


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baysider
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Monday, September 27, 2010 - 05:57 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 MM

Yes I was very surprised they paid out, I thought only those who bet on the draw won and that the bookies had cleaned up - again. Nice surprise though my bet was minimal, a few drinks none the less. A fantastic game it has to be said even if you're a neutral. Sport at it's finest, though being a POM Soccer is really my game. Watch Arsenal play if you want to see football poetry in it's pure form.

Back to the markets I guess we're climbing the proverbial wall of worry. I guess we're due a retrace but look at the XJO chart from Feb 26th to the April high and there wasn't much of retrace then during the 400 pt rise.

Where do you get 4720 from out of interest? The market made a fresh high today, and the old high from May was back at 4653 so it looks like it breaking out to me - not to say it can't retrace of course but there's some good momentum in copper stocks today of which I own ABY and DML. EQN and PNA also going very well.
Not sure whether to take some profits now or hang on through any retrace that might occur. With end of the month I'm tempted to get out and see what happens next.


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market_mad
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Monday, September 27, 2010 - 08:02 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)



Hey Baysider,

You've got to call it football then my friend and not soccer!! Being a sweaty sock, football is my game too! HUGE Celtic fan and, you won't like me now - Spurs fan! My Dad used to live in London and take me to all the games so I grew up watching Spurs and Celtic. I do have to agree though that the Gooners are the poor man's Barcelona!! Only jesting - they are playing some awesome stuff but let's not mention the Brummies (or West Ham for that matter!)

With the rise that we have had, I expect that a lot of short covering will take place and get triggered above 4720 which will add 100 pts or so easily in very quick fashion. From there it will act like a magnet back up to 5000.

As you know, there is often end of month shenanigans that goes on, hard to say which way it will go this time. Interesting that the VIX hasn't made a new low yet so there is still a little bit of hope for the bears, although I feel that a push above that 4720 level will see our market kick on as we have definately been underperforming the US and UK markets.

Cheers Baysider - if you are ever on the Gold Coast, let me know and we can hopefully take in a North London derby with a few pints!

MM


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billt
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Monday, September 27, 2010 - 08:20 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)



hi ehmu

Thanks mate for the link - if it was a movie you would walk out half way through and say what a totally ridiculous plot - surely THAT would never happen...

The Fed buying government debt in a hope to spur business to invest;

US Businesses not confident in the future so they cut their cost base and their staffing levels to prop up their profitability;

US Banks have their balance sheets substantially propped up with 'dodgy' residential valuations;

US Consumers have substantial negative equity in the homes as home prices fall, are worried about their jobs, and stop spending....

The Fed buying government debt in a hope to spur business to invest (take two - QE2);

Fills you with massive confidence that they have it all under control...


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ehmu
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Tuesday, September 28, 2010 - 12:36 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)



Hi Bill:

Regarding the article by John Mauldin. What I was more focussed on was the implications of deliberately devaluing their dollar.

I don't know much about it, but it seems to me that when you do that, you force the rest of the world to suck up your pain. This causes major global unrest if the other players can figure out what's going on. We know that China doesn't like it much, they've been objecting publicly.

Maybe a qualified person like "ody" would be better suited to comment on the massive $us devaluation idea. The us is camouflaging their initiative with "deflation" paint, don't know how long that will fool anyone.



_____ n a m a s t e

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baysider
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Tuesday, September 28, 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)



Hi MM
You're right about the term football, soccer is so American but with so many codes of football here it does confuse the locals.
Thanks for the invite to catch up, haven't been to the Gold Coast for years. No immediate plans but you never know.

If Aitken says anything useful let us know. I expect he's quite pleased with himself at the moment.


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ody
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Wednesday, September 29, 2010 - 07:15 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)



An ominous warning for our economy ...
-------------------
Productivity falls as reform stalls

* David Uren, Economics correspondent
* From: The Australian
* September 29, 2010 12:00AM

THE productivity gains of the 1990s have all been lost as the economy battles with capacity constraints and the lack of economic reform.

A presentation to Treasury by the research director of the Melbourne University-affiliated Grattan Institute, Saul Eslake, shows the fall in Australia's productivity growth has been greater than in other developed economies and has affected most industries.

It debunks the view of the Productivity Commission that Australia's flagging productivity growth is mainly the result of investments in the mining industry and the utilities that have yet to bear fruit.

"Even if you exclude these industry sectors, there has still been a noticeable slowdown in productivity growth," Mr Eslake said.

"The intent of the presentation is to challenge the widespread belief that most of the slowdown can be attributed to things that have happened in just a few sectors."

Excluding the mining and utility sectors, as well as government, Mr Eslake said the growth of productivity had peaked at 3 per cent in 2001-02, but had since dropped back to 1.1 per cent.

The 1990s, seen as the golden era for productivity growth, saw the output for every hour worked rise from 87 per cent of the level achieved in the US, which is still the world leader, to 94.3 per cent by 2001-2. However it has since dropped back to the 1990 level.

Mr Eslake said one reason for Australia's fall was the very strength of the economy, which had left businesses hiring people who might not be ideal for their positions, and making investments delivering marginal gains.

He said that business had been so profitable that it lacked the incentive to lift productivity, with a survey by Telstra showing that only 42 per cent of companies measured their productivity and had a target for it.

However, he said it was likely that another reason was the lack of reform over the past decade: "The easier reforms have been done and the enthusiasm of governments of both political persuasions and the people as a whole for economic reform has faded."

Mr Eslake said areas that had not been tackled included health, education and the public service as well as pharmacies, newspaper distribution, international aviation and agricultural marketing.

He said falling productivity had been a global trend over the past 10 years. However, the decline in Australia was more severe than in other developed economies.

He said the only source of productivity growth in Australia over the past five years had come from businesses investing in new capital plant.

But businesses have become less efficient at winning gains from combining their labour and their capital plant in what is known as multi-factor productivity. This has fallen by about 0.7 per cent a year for the past five years.

Mr Eslake said that in the 1990s, global surveys of competitiveness showed that Australia was one of the leaders in adopting new technologies, with only the US and the Scandinavian countries ahead of it. But the latest survey by the World Economic Forum has ranked Australia 23rd, with most of Europe and many developing nations ahead of it.


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ody
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Baysider: soccer

"Soccer" is NOT American. It is a perfectly normal British word. To someone coming here from the northern hemisphere the Australian use of the word "football" is a confusing term, as it refers to something quite different from what in Europe, including Britain, is normally meant by that word. The advantage of "soccer" is that it is the only word that very accurately refers to the game being played by two teams of eleven players who use their feet (or heads, but not their hands, except the keeper) for moving the ball. As such, I prefer the precision of "soccer" to any other word for that particular game - the "football" of my youth, as a "continental". It's precise and unambiguous.

I add that I wish Australia would do more to excel in soccer. It easily has the talent, but by wasting so much time and money on a game only played in this country ("Australian rules") it sidelines itself internationally when it comes to the most frequently played and internationally best understood form of "football", and does not engage in "the main game".


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rdumas
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Wednesday, September 29, 2010 - 07:46 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)



Hi Ody,

Spoken like a "true" soccer believer. Let the rest of the world bore themselves stupid watching two teams kick a ball around for 90 minutes to achieve a score of 1-0. In Australia we like the excitement of watching a game that is capable of delivering a try in less than 60 seconds.

That's why we don't have to think up ways of blowing each other up or wage wars amongst observers on the sidelines to enhance the excitement of their games.

Who has got it right? I'll leave that for others to make up their own minds but I know which game I would prefer to watch.


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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market_mad
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Hi Ody/Rudy,

Hello!! A bit of interest here - the beauty of football is is just that Rudy - it can be the most dramatic game of all(can't call it soccer sorry and it is a game that is played with your feet and with a ball - not like those handball games that occasionally kick and call it football!).

Think of the AFL Grand Final - brilliant game and so tense - why it was so tense was because each team new the next point was potentially the winner - same in football - if it is 0-0 and there is a lot a stake then the intensity can be incredible (although I do admit you can get some absolutely dire 0-0 games and I'd take a 3-2 thriller any day of the week - if you watch the A-League then I can understand because teams there just don't seem to want to win and are playing so negative). I think it was Jimeoin (never liked him) who commented that Aussie Rules is the only game on the planet that will give you a point if you miss the target!

Football is truly the beautiful game and the biggest game in the world. Maybe if Australia wasn't so fascinated on getting the World Cup in 2022 (which they won't - Qatar will get this mark my words) and actually spent some time on developing/marketing the fledgling A-League then you would actually realise the potential it has in this country. All the kids play it in Primary schools and then it dies out??

Sorry Ody - but soccer is not a word used in the UK anywhere ever. Football is football and rugby (even league) is rugby. It is sacrilege to use the word soccer in the UK and if you do use it then people think you are from Eugenio land.

Cheers
MM


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baysider
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Hi Ody

In replying to you I had to get my facts right and you are correct 'Soccer' is a British word, a short form for Association as in Association Football, the correct terminology. However, I'm sure MM will support me here, to use the term 'soccer' in England is to be derided. Everyone is brought up with the term football, soccer is somehow associated with those who don't really understand the game, countries where it's not the national sport, such as America. I say it through gritted teeth so as not to confuse in a country like Australia with many codes of football but it still grates!

Enough on football, lets have some tips! A number of your favoured stocks are travelling very nicely at present Ody, FGE and ANG to name but two. Does nothing take your fancy?


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cat_lady
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Baysider
check out IDL = just announced yesterday that they've converted bonds to debt which has reduced threat of possible dilution of the SP - hence recent strength. good little compnay as well.
cheers
cat lady


Without my morning coffee I might as well be a dog

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eblode
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Wednesday, September 29, 2010 - 10:19 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)



Cat Lady,

While these guys are discussing soccer vs football keep your eye on GBE. Bght in on at .30 and it's still flying.

Eugene


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baysider
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Thanks for those Cat Lady and Eugene

I saw Hershey likes IDL as well, going gangbusters well done.
Where do you pick them Eugene?? Looks like you bought in just in the nick of time!
I'm on DML, going very nicely since it broke 98c to make a new all time high. No stopping it since then, bought in at $1.03.

Cat Lady if you're as good as your name check out my new business formulated with Eugene's help, www.fetchboy.com.au. We do cats as well!


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cat_lady
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eugenio

GXY - enjoying the ride? I am of course, now that I've typed about it it will probably head back south....

GBE - will look at it.

IDL - retracing a bit today, but still worthy of consideration

MCE - still got some legs in it I think

Baysider - the cat doesn't like cat food....
I'll have a look at the dog food though.

cheers
cat lady


Without my morning coffee I might as well be a dog

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ody
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XJO and 4700

AS I have said before, the XJO has on more than one previous occasion, after its fall from grace in mid-April, tried to break into substantially new ground and in effect failed to do so. This time round, it has done well to get beyond 4600 fairly quickly, but it seems to me that investors are very conscious of 4700 as a new psychological barrier to break, and so far that seems a much harder task than going through 4600.

Added to that, it would need very little by way of discouragement to go back to 4600 where, however, there is now some support. But even that is not necessarily strong.

I do concede - and have previously conceded - that the past few weeks have seen a change in attitude on the part of a SECTION of investors: not necessarily enough of them to create an upward rally of significance. There is still a great deal of money being placed in fixed interest. To foreign investors, moreover, the fact that any share here that cost, say, US$30 to them some time ago now costs considerably more, will also weigh in considering new investment in our market. Depending on one's view, the A$ could well go up further (I think it may, for reasons mentioned before); but it is also unusually high, so that some form of correction could readily occur which would then not please those who have just bought a share that already cost them money in part because of the high A$.

Notwithstanding all this, it does seem as though fears of a second dip have become less pronounced and frequent, and this is obviously the "new optimism" that is driving markets. The reasoning appears to be that if there is no second dip, then there will be gains - a non sequitur, which may cost longer-term investors dearly. Those long at the moment should bear all these factors in mind.

But the main one is really what the REAL strength of the market is. So, keep an eye e.g. on the VIX. Keep an eye on volumes. On the charts themselves. Could the XJO at present be indicating that it is quite uncomfortable going beyond 4700, and is seeing that as its limit? If it does, and does not break that convincingly, then a correction for some weeks would be on the cards, and this is what I meant when I said to Baysider that he might have gone in too late. I hope I am wrong, but I think that a lower level in, say, October, might well be wiser as a point of entry. That could then be aided also by the so-called Halloween factor. Such a pattern would be "classic".

The next few weeks will make clearer, I imagine, where we are heading. If it becomes broadly "accepted" that a double dip will be avoided and that - thus the spurious reasoning goes - we will THEREFORE see the opposite, then people may persuade themselves that a rally to, say, 5000 is warranted. This would be a market assessment - not one based on sound fundamentals - but one quite plausibly in a hesitant process of establishing itself.

Before moving in, I'd wait and see whether the XJO will CONVINCINGLY go beyond 4700. And I'd be happier if it first went down - preferably below 4600, with something like 4500 ideal - with the prospect of it moving up from there, before venturing in at all.

Remember, we have really had only a few days of sunshine on our market. It is testing itself out.

Admittedly, and ironically, I cannot argue against the fact that several stocks I have praise in the past are among those faring very well. That does show good stock selection - but not necessarily that the market will be sustained in its upward move of the last few days.

I DO find it important that the most recent low was higher than the previous low, and can see the potential for a market moving up. It's nevertheless the upward barriers that I am concerned about: there seems to me strength there, and evidence of a lack of conviction that they will be "taken out" within the near future. Certainly I am somewhat sceptical of the claim that it will be plain sailing to 5000 from here.


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ody
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Wednesday, September 29, 2010 - 03:15 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)



XAO in the red

I note two important factors as close at hand to me:

1) The XAO is now in the red, and has fallen very steadily since its initial move up today.

2) My interest rate securities, many of which are benefiting from the sense that intererest rates will go UP (note: these are NOT structured like US bonds), are doing well currently. There is clear evidence of buying here, suggesting profit-taking in shares and money moving into fixed interest. There seems to be a fairly strong view - hardly wavering in recent days - that interest rates will rise as a result of Australian inflation and overheating.

These factors IN COMBINATION would suggest a decreasing interest in the share market just now, and an increase of interest in fixed interest. And that would seem to indicate that the current rally on the ASX might be in the process of getting reversed, as the downward move today rather suggests.

I have a fairly strong conviction that many fund managers would have been happy to take the market up just beyond its most recent peak, but with the firm conviction that they would then lock in profits. Had I been in the market myself, I would have taken the view that a sustained move beyond 4700 for the XAO would be EXTREMELY unlikely.

It is also for that reason that I believe that if the market does go there, that then a REAL breakthrough has occurred. In other words, going above 4600 already showed a new kind of courage, but a rise beyond 4700 will require some real "balls". And many are at present NOT afraid of being seen as cautious. A confident move beyond 4700 would to me indicate a true (not just superficial) change in mood, which could then take the market much higher (at least 5000).


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baysider
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Wednesday, September 29, 2010 - 04:16 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

For the last hour I've been steadily selling out of nearly all my positions as the market certainly looked quite toppy today as you suggested in your last post. I'm happy to take the profits from ABY, DML, AGO and the pain of losses on EXS (did badly today) and AQA. All in all it's been a good few weeks and no need to push (*censor*) it too far, the market certainly looks like it needs a pullback and the end of the month is almost here. Lets see if Colin, Rudy and many others are right and that mid October may be a good time to have another pop.

MM
Just saw your last post, we must have been writing/posting at the same time and are clearly in telepathic mode!


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paint
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Wednesday, September 29, 2010 - 04:34 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)



It would seem that this next couple of days will provide the perfect opportunity for long-only funds to lock in a great quarter, this combined with USD heading south, has me adding to NWS and JHX shorts, entering CTX short, and long SDL for a potential bid. US economic news continues to fall short, and the main driver of the market seems to be M&A on cheap debt...


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eblode
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Wednesday, September 29, 2010 - 04:41 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)



Steady lads,

Just a bit of profit taking as we continue towards the 5000 mark. I don't hear too much about double dipping and 3800 drops these days. With the AUD$ closing to parity there should be some real action ahead.

Eugenio


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ody
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Wednesday, September 29, 2010 - 05:37 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)



Soccer and British usage

My point was simply that it is incorrect to think of "soccer" as an American word and not a British one. It is not used a lot in England - where I have spent a total of more than five years and which I continue to visit regularly - because there is no need for it. Everyone knows what is meant by the words that are in more common usage, as they don't play "football" in the confusing sense of "Australian rules" there. However, you will find that in any discussion about the various games that might be (and are) confused with each other the British will IMMEDIATELY come up with "soccer" as what they acknowledge to be the most unambiguous term for that game: it is so to speak a formal, technical "translation" of "football". In normal usage the word "soccer" doesn't need to be relied upon in Britain, as "we" (the British) all know what it what. I would NOT myself use "soccer" in ordinary conversation with the British, but it is a term they fully understand, and handy if absolute clarity is needed.

On the whole, they tend to think of Australian rules as a silly antipodean game, and if you refer to THAT as "football", in British company, you are really going to be in trouble. Similarly in Holland - where I come from, originally. There, most people have not even heard of Australian rules. Football is Football - and there is an end. What they are referring to is soccer. The Dutch word is "voetbal" (voet= foot). This is the common situation in dozens of countries. Football (in the sense of soccer) is THE major team sport to play worldwide if you wish to be taken seriously, and Australia will always be viewed as a second-rate sporting nation that needs to grow up for as long as it has no serious status as a "football" nation in the normal global sense of that term.

It does not matter how good you are at your own Australian rules, or even rugby (say), or netball, or basketball - as a serious ball game and teamsport you MUST play football (in the sense that that word is internationally most widely understood).

Time was when - in my youth - ONE sport played by Australians did give them status in Europe, and that was tennis. The Australians had invented serving-and-volleying as their characteristic strategy, and blitzed others off the court with it. Now noone really thinks of them as a significant tennis nation, outside Australia itself.


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ody
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Wednesday, September 29, 2010 - 06:01 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)



Eugenio: the Australian dollar and foreign investment in the share market

Eugenio, in the "basket test" of how much your money can buy in different countries, the Australian dollar is currently 27% overvalued. People overseas, e.g. Americans, can for themselves see that our dollar is VERY high, so (a) they know that if they buy shares here the potential gains may convert to a loss if our currency falls, and (b) they will realise that IF our dollar goes up further, it will be important to lock in profits quickly, as otherwise one's overseas investment is at risk. The higher our dollar goes, the more risky it will seem, i.e. the higher the risk of a fall becomes. For example, if we move quickly to $105, I would expect a correction to $100 or lower before we can go up again.

It IS possible for our dollar to stay stronger for longer, but most commonly it would correct before doing so. And if it does not correct then it will still be viewed with a degree of suspicion.

This currency matter should also concern Australians. One reason why our share market is not that "flash" is that from e.g. a US perspective it does not look cheap, as the price of any share that was e.g. US$30 before the recent rise of our dollar now costs an American a much bigger sum to buy.

At the moment, I grant you, 3800 does not look like something the market here will soon fall too. But although you may not have heard much of a double dip of late, there certainly are economists (including several with the best track records) that still see it as a real possibility. And there are not many among them that see the international situation as actually IMPROVING, as distinct from perhaps not DETERIORATING AS MUCH as was feared.

For a good, sustainable rise in share markets there needs to be a widespread belief that economies not only will not face a dip, but that they have solid recovery prospects. Such a belief would be a myth, as things stand, but it does seem as though an increasing number of people are beginning to believe in this scenario, which explains the recent rise that we have seen. That is what supports your case that we are on the up.

As against that, the Australian market does now again appear to be correcting, with money going into fixed interest instead. What I think "the new normal" will show is fund managers taking markets up moderately, and then selling to lock in profits. That is the safest strategy for them to play: short-term riding of short-term rallies, and locking in profits. That, in terms of share market behaviour, is to my mind the likeliest scenario, which would mean a market essentially going sideways. We may well have the odd move up to 5000 or down to 3800, but so far we are (and have for months been) on the whole within a band that has been around 4200 - 4600, with only minor and rare departures outside the limit. Thus a correction back into this band, and likely enough the bottom of it, would seem very plausible.

IF the positive myth-making continues, after a correction, then the thing to do would be to get in at around 4200 or 4300, on the assumption that the market would go to 4800-5000 by Christmas, aided by the Halloween factor.

I still suspect a modest correction (say to 4200) over the next few weeks. I doubt it will reach 3800, now, unless we get fresh bad news. Whether the market rises significantly from the next low (of 4200 or whatever it may be) will depend on what is felt about the recovery question some weeks further down the track. If optimistic, the market could very well go up significantly from the next lower plateau.

It IS possible that today was just one down day, and that the pressure to go up will return again quite soon. But a safer assumption will be that there will be some profit-taking.


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ody
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Wednesday, September 29, 2010 - 06:29 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)



"Monetary easing" and Gold, silver, etc

Gold and other precious metals are being favoured at the moment, in addition to certain currencies and bonds.

Note: NOT shares.
---------------------------------------------
From Bloomberg:


Gold Increases to Record for Fourth Day as Fed May Add to Monetary Easing
By Sungwoo Park - Sep 29, 2010 5:48 PM GMT+0930

Gold advanced to a record for the fourth straight day as the dollar dropped to an eight-month low on speculation the Federal Reserve will add to monetary easing. Silver increased to a 30-year high and platinum increased.

Gold for immediate delivery added as much as 0.3 percent to $1,313.45 an ounce before trading at $1,310.95 an ounce at 4:53 p.m. in Seoul. Cash silver gained as much as 1.2 percent to $22 an ounce. Platinum rose to the highest price since May and palladium gained to the most expensive since April.

“Disappointing economic data are fueling speculation the Fed will add to monetary easing, boosting gold demand,” said Chris Yoo, head of global derivatives at Samsung Futures Inc. in Seoul. Exchange-traded fund “holdings are increasing and gold may reach $1,500 by the end of the year,” he said.

The Dollar Index, a six-currency gauge of the greenback’s value, dropped to 78.678 today, the lowest level since Jan. 28. The U.S. currency traded near a five-month low against the euro.

Gold futures for December delivery increased as much as 0.5 percent to a record $1,314.80 an ounce in New York. The metal for December delivery on the Shanghai Futures Exchange reached an all-time high of 283.26 yuan ($42) a gram.

U.S. consumer confidence declined more than forecast this month to a seven-month low on growing concern over the outlook for jobs and wages, data from New York-based Conference Board showed yesterday. Home prices in 20 cities rose at a slower pace in July from a year earlier, according to a report from S&P/Case-Shiller yesterday.

U.S., Japan Easing

The Federal Reserve said Sept. 21 it’s willing to ease monetary policy further to spur growth and support prices while refraining from expanding its holdings of securities.

The Bank of Japan will discuss additional monetary easing steps at its two-day policy meeting starting Oct. 4, Kyodo News said yesterday, citing unidentified sources.

Gold is heading for a 10th straight annual advance and is “still some way from displaying the characteristics of a bubble,” Deutsche Bank AG said in a report yesterday. Bullion has risen 20 percent this year as governments spend trillions of dollars to stimulate their economies, increasing concern that currencies may decline. Silver has jumped 30 percent this year.

The ratio of gold to silver dropped below 60 for the first time in 11 months as investors sought to protect their wealth, attracted by the metal’s relative cheapness to gold. One ounce of gold bought as few as 59.6210 ounces of silver today, the least since October last year.

‘Haven Asset’

Holdings in the SPDR Gold Trust, the biggest exchange- traded fund backed by bullion, increased 5.17 metric tons to 1,305.69 tons as of Sept. 28, according to figures on the company’s website. Holdings in the iShares Silver Trust, the biggest exchange traded fund for silver, climbed 143 metric tons to a record 9,756.04 tons as of yesterday, according to the company’s website.

“In Europe, Ireland’s Finance and Foreign ministers tried to calm investors following S&P comments that Ireland’s cost of Anglo Irish Bank’s recapitalization could exceed 35 billion euros and may trigger further downgrades -- increasing gold’s appeal as a safe-haven asset,” Mark Pervan, a senior commodity strategist at Australia and New Zealand Banking Group Ltd., wrote in a report today.

Irish Foreign Minister Micheal Martin in an interview yesterday “absolutely” ruled out activating the European bailout package for Ireland, saying markets will calm after the government clarifies bank-bailout costs and the budget outlook.

The government in Dublin will provide details of the bailout costs for Anglo Irish Bank Corp. by the end of the week and soothe bond investors after Standard & Poor’s said more than 35 billion euros may be needed, Martin said. The budget is financed through the middle of next year and Ireland won’t need money from the euro fund, he said.

Platinum for immediate delivery gained as much as 0.9 percent to $1,651.75 an ounce, the highest level since May 19, and palladium climbed as much as 1.4 percent to $572 an ounce, the highest price since April 26.

To contact the reporter on this story: Sungwoo Park in Seoul at spark47@bloomberg.net.

To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net


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paint
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Good morning all,

UBS tech team have started to doubt their bearish stance:

Equities Moving into Make-or-Break Setup
 US Trading: With the strong Friday rally, SPX and DJI have confirmed their recent breakouts and with
improving volume we could see further squeezing towards 1155 to 1165 before this rally ends. On a tactical basis,
the market is overbought. Financials continue to underperform aggressively and we still have divergences in
momentum indicators and the VIX index, suggesting that the upside from here will be limited. Last week’s
reaction low at 1122 represents a new pivotal support for the market. As long as it holds, the September rally is
intact. However, we stick to our call and wouldn’t chase the market on a broader base, and if so, we would apply
a very tight money management, using last week’s reaction low at 1122 as a trigger to sell/short/protect positions.
 US Strategy: Fuelled by the weak US dollar, the September bounce is stronger and is moving higher than
expected. Last week we said that the higher the rally goes the more unlikely it would be to see another strong
correction into the October/November timeframe. Small and mid caps and the transport sector are challenging key
breakout levels. A combined breakout (weekly basis) of the Russell-2000 and the DJT would furthermore be
evidence that the risk of seeing another strong correction leg is deteriorating, so that at the end of the day the
market could remain in its sideways trading range of the last few months. With a weekly closing above 673 in the
Russell-2000 and 4500 in the Dow Jones Transport, we would make a U-turn in our medium-term market stance
towards a more positive bias, so that weakness into October could be seen as more of as a buying opportunity
than a threat. With this week’s trading, the US market is obviously moving into a classic make-or-break setup.
 European Trading: With a relative short signal in place, Europe continues to underperform the US. On a weekly
basis most headline indices have produced doji candles, so the overall situation is factually unchanged from last
week. However, with the sharp Friday rally, it’s likely that we see a major breakout attempt this week, so most
European indices are moving into a make-or-break setup. A weekly close above 2850 in the Euro Stoxx-50 would
be bullish, whereas last week’s reaction low at 2709 represents the pivotal support and potential short trigger.
 With the SMI we have a first market that has generated a weekly and daily short signal, as well as the index has
broken its 2003 long-term outperformance trend versus Europe.


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eblode
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Thursday, September 30, 2010 - 09:58 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,

I was most impressed by your complete analysis of the market conditions.

Eugenio


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market_mad
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Hi all,

Bearish move on our market yesterday has been followed up this morning. Big seller in our market from the open and should see us test the 4600 level on teh ASX200 at some stage in the day.

The bulls had better be careful coz this selling that we are seeing just now reminds me of January this year when our market dropped significantly from the 5000 level.

Hold on to your hats boys!

Cheers
MM

PS Eugenio - markets can run harder and faster than people expect for much longer than anticipated. 3800-4200 is still the target range for me. If it closes below 4570 then this tells me that this is not just a correction in an upward advance but the sign of a significant move lower.
Alternatively a move above 4720 will see us target 5000 so the next week or so is crunch time.


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eblode
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Thursday, September 30, 2010 - 10:59 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)



Baysider,

Bght another swag of EXS at.50. Topped up GBE at .38 We're on our way up to 5000 as we speak.

Eugenio


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market_mad
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Thursday, September 30, 2010 - 11:00 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)



Also our banking index is looking vulnerable for a move lower and as we know, our market doesn't go up without the banks

Cheers
MM


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market_mad
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Thursday, September 30, 2010 - 11:04 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)



Righto Eugenio! Today's action looks like a move to 5000 to me as well! Lol


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ody
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Correction on

It is difficult to believe that the much-predicted correction hasn't now started, and will probably take some weeks.

The typical US situation is that the market had moved up from a lowish point because that was considered low, and that for a while some "good" news was taken on board and the negative news ignored. Subsequently, with markets getting back to, or slightly beyond, their previous high (in the recent past), renewed worries set in, as in essence there is just no cause for any strong belief in a recovery, so down again we go. As I have described it before, all this is very typically part of range-trading, and I think we shall see a lot of it in times to come, unless news very decisively turns one way or another.

We'll now have to see how far the correction goes. There probably aren't many truly panicky bears, which will provide a limit. There are bulls, but - as we know - not enough to take the market up really high. So one might expect the fall to be within the market range that we have seen. Then no doubt the bulls will move in again, but unless something changes significantly, they will once again take the market up no further than 4600-4700.

However, any positive change might serve as a pretext for going beyond 4700, as there IS more bullishness around.

But first we shall have to go down, in any case, and the IMF news this morning is likely to have caused some anxiety among Australian investors with their high risk exposure to little more than resources as the one factor really to propel the economy along. Outside that area things don't look at all good. Any crash in the mining boom - not at all impossible - for prove lethal for our dollar and our share market. So the situation concerning both the currency and the share market is high risk. Not that the IMF excels in correct forecasts - but its statement of what is happening is usually more reliable.


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ody
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Thursday, September 30, 2010 - 11:09 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)



MM: had not seen your earlier posts. We basically agree - Eugenio is constitutionally optimistic. I would agree with you on the 4200 as a target, but am less confident about the 3800. I don't think as many are as pessimistic as a few months ago. But you may be right even so.


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market_mad
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Thursday, September 30, 2010 - 11:17 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)



Hi Ody,

I think when the US FINALLY wake up and realise that QE1 and QE2 don't and won't make a difference you will find despair, anger and fear return to the markets as we did in 2008.

There is no doubt in my mind that Bernanke is going down the path that Japan took and Heli Ben will go down in history as not the person who saved the US economy but as the one who destroyed it.

Cheers
MM


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eblode
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Thursday, September 30, 2010 - 11:50 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,
I am amazed that you feel I am " constitutionally optimistic". How far from the truth. I simply am a realist. Last April when I bet with MM that the USD vs the AUD would come to parity and even surpass it in October. At that time it seemed a fantastic prediction....and now we are almost there...and if in October it surpasses parity then MM will have to give me refund. However to disregard hard evidence of a recovery and to keep yapping about a downtrend to 3800 and now 4200 is to my way of thinking not realistic unless you are a constitutional pessimist. Fortunately I am immune to criticism, and frankly even enjoy it, especially when proved correct. And so I remain positive on a continuing positive market reaching 5000 within the Christmas period. Meanwhile I'm more interested in seeing my CDA,SDM, and others keep heading north...that's the real object of this game. Isn't it?

Eugenio


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market_mad
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Thursday, September 30, 2010 - 12:12 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,

Our bet was not on parity for the AUD/USD by October. You actually bet me that the AUD would be trading higher than $1.27 against the greenback by October 15 2010, so unless the RBA put rates up by 5% next Tuesday you've got buckleys of getting a refund mate!

So, if it had been parity it WOULD have been a fantastic prediction on your part but I'm sorry 30% below your target doesn't quite cut it in my book as a fantastic prediction.


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baysider
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Thursday, September 30, 2010 - 12:15 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)



Good luck with EXS Eugenio, I didn't like the close below 51c. It's closed below the uptrend line and looks like it's retesting that line today. It'll need to confidently close above 51c for me to have another look at present - 46c looks the more likely key test but we'll see, it'll only take one bit of good news for take off again!


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eblode
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Thursday, September 30, 2010 - 02:05 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,
Don't get your knickers in a knot. You're absolutely right. I just thought that my prediction of $1.27 vs the USD in October was a long shot but an interesting bet
and lo and behold it still may happen.........but in any case I would'nt reneg on any bet that I paid off on. This is a game MM, not life or death. So lets play.

Eugenio







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bridog
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Thursday, September 30, 2010 - 02:08 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)



EXS:
Guys, I exited at 54.5 after seeing a double top.

I won't re-enter now until they close above 57c.

Not a bear, but I will not be surprised to see the market retrace somewhat in October before returning to uptrend and new highs (meaning higher than now) in the run up to Christmas.

I'll be keeping tight stops for a while.

Cheers


Old enough to know better . . .

 
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