Riding The Gravy Train: October 2013

Riding The Gravy Train

Beating the market is fun and profitable. This is how we do it.

Wednesday, October 30, 2013

American Graphite Technologies (AGIN), DJIA Chart Update


In mid-September we posted "A few graphite stocks worth considering."

On net, those stocks have since gone sideways.  USGT has been the stand-out, at one point almost doubling.

Here we present the chart of another penny stock in that sector, AGIN (American Graphite Technologies), which shows a six-month downtrend broken:



In that same mid-September post linked above, we also presented this chart of the DJIA:


At the time, we wrote: "We cannot become bullish unless we see consistent closes at new highs, above the horizontal red line."

Here's an updated chart, showing that a few days later the index turned right at the horizontal red line, and that the DJIA is now again challenging the line:












We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.


To be notified when this blog is updated : Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a blog entry only contains general commentary.

Monday, October 21, 2013

BBVA (Banco Bilbao Vizcaya Argentaria SA), Voxeljet (VJET), Weekly Market Outlook


Here's an audio interview by Chris Versace with Ed Bilek, the head of U.S. shareholder services for Banco Bilbao Vizcaya Argentaria SA (BBVA).

A shame we hadn't paid attention to the stock almost three months ago, when the break above a 6-year downtrend first occurred:


The chart also shows a double-bottom just over $5 in early 2009 and mid-2012, and this year it finally broke decisively above the $10 level which was an area of support and resistance the past four years. 

At this point it's arguable that a pull-back is due, however it could also easily continue higher.  We've not yet decided, but will probably take an initial position this week.  We like it on technical points, especially as long as it closes above $10, and it fits with our recent theme of getting paid to hold any long positions as we maintain a longer-term bearish market outlook.

At the current price the BBVA dividend represents a yield of just over 4%, and most importantly it's well-funded and seems stable.



News: Shares of 3-D printer company Voxeljet roars higher in trading debut.


We purchased shares at an average of $23, and will hold those with an initial stop at $19 which is just below Friday's low.  Those bullish on the 3-D printing sector will find this company especially compelling, perhaps even a value. 

Volatility is a given, and while upside is tremendous initial public offerings are best participated in cautiously and by those with experience in such issues.  It could as easily be at $50 as $15 in a couple of months, perhaps a couple of weeks.

Read more about voxeljet (official spelling is with a lower-case "v") on the company's website.




On October 11, we'd forecast that "The market is likely to continue higher for at least another couple of days."

Indeed, the market carried higher which brings us to the current situation of the S&P and NASDAQ posting new highs while the DJIA is lagging in non-confirmation. 

There are many technical and sentiment indicators which give us pause.  To keep it simple we'll just say that our outlook is short-term neutral and longer-term bearish unless the DJIA is closing at new highs, which would be above 15700.

This site enjoys first-time visitors daily.  Readers new to our "Weekly Market Outlook" may wish to review the links below.  Regular readers are unlikely to find a review worthwhile.

August 30 Weekly Market Outlook

October 08 Weekly Market Outlook














We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.


To be notified when this blog is updated : Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a blog entry only contains general commentary.
 

Friday, October 18, 2013

Booking Profits, Star Scientific Inc. (STSI) Update


The calls positions updated last post have been sold for significant short-term profits, while the shares remain (currently up over 15%). 

We'll raise the noted stop up to $66 and if $70 is hit we'll sell at the market. 

At the same time we'd roll the profits into the inverse, TZA, circa $20. 


On the morning of October 08 we wrote about Star Scientific Inc. (STSI):

"Note the year-long downtrend broken and the current consolidation around $2.00  Typically such a pattern eventually continues upward."

By the following week, the stock was up over 33%

Some have written us to say they booked the quick profits.  Congratulations!  Others have written to ask if now's a good time to buy for those who were too slow earlier in the month.

For us, the answer is "yes".  The technical pattern obviously resolved upward as expected, and longer term we hope for an upward trend to establish itself and last awhile.  The company may even prove innovative and successful. 

As we noted originally this stock is highly speculative and there's much controversy surrounding it, so we're only concerned about the technical picture.  Here it is, updated:


It's safest is to sell if STSI starts closing below the red uptrend line, say below $1.80 to offer some leeway to the September 27 lows.  We'll likely hold ours longer-term regardless. 



 



We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.


To be notified when this blog is updated : Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a blog entry only contains general commentary.

Friday, October 11, 2013

Update On Recent Call Positions, Stock Market, and Gold


Tuesday we announced we'd booked profits on our most recent short positions, as we expected a market bounce.

Wednesday we noted the speculative positions we opened in expectation of a market bounce, citing reasons such as the DJIA's 200-day moving average roughly 50 points lower and a 7-month uptrend in effect roughly 25 points lower.

That same day, from 60 points lower, the market bounce began.  It continued Thursday, resulting in the biggest one-day rally this year.  The market is likely to continue higher for at least another couple of days. 

Friday we're up over 100% on the TNA October calls,  up 24% on the November calls, and up 6.5% on the shares.  We've put a stop on those shares at $60.90 and will close all of the calls if the market starts trading down on the day.  The DJIA is up over 40 points as of this writing.

Our "market outlook" postings continue to prove extremely accurate.  For that we thank our good fortune and will be sure to save most of those profits and spend the rest on something memorable rather than putting that money at further risk.

Here's a valuable lesson to consider - successful operators in the market regularly take money out of their brokerage accounts to add to their savings and assets while reducing their market risk.  Unsuccessful operators regularly take money out of their savings and assets and add money into their brokerage accounts thus increasing their market risk. 

If you can't turn a profit consistently with the money you already have at risk, putting more money at risk is a very bad idea


We've been asked if we're turning bullish yet on gold and re-loading on related long positions. 

Mid-day August 27th, we posted that we were selling most of our gold and silver speculations for hundreds of percentage points of profits, which were bought in late June virtually at the lows

As it turns out, mid-day August 27th was effectively the exact highs for gold's bounce from the late-June lows, and since then the yellow metal has fallen over 10%.  Despite that drop, we do not see compelling reasons to turn bullish. 

Gold can, and eventually will, fall much lower.  There will be bounces and rallies along the way, some probably enormous which will suck in most buyers at the top as has been happening for over two years now, and we'll do our best to call those as we've called most pops and drops in the price of gold, however in our estimation now isn't the ideal time to speculate long or short in gold or silver. 












We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.


To be notified when this blog is updated : Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a blog entry only contains general commentary.

Wednesday, October 09, 2013

DJIA Chart Study, Buying Dividend And Income Fund (DNI)


Given we are expecting a market bounce, late Tuesday we purchased TNA October $58 calls for $2.75 and November $59 calls for $4.75 as well as TNA shares for $58.25 

If all these go our way, we'll be quick to book profits.  If we fail on the October calls the November calls might bail us out, and failing that we can hopefully make up for it by sitting with the shares and perhaps adding to them on significant drops.  That's the plan for now.

We do still maintain these short positions for balance, and will book the gains if the market continues much lower.  The net result is that we're currently bullish very short term and remain bearish in the intermediate term and longer term.  That's a bit convoluted and risky, and while some would just close out the shorts rather than add longs to the mix we're reasonably comfortable with this positioning.

We have several reasons to be short-term bullish, however there is not yet an actual bullish indicant suggesting a bounce will soon begin. 

In part we're going on instinct, and in part thinking there will be a bounce because the DJIA closed Tuesday just 50 points above its 200-day moving average (not shown on DJIA chart below) and about 25 points above a 7-month uptrend (in red on DJIA chart below).

Also, as can be seen on the DJIA chart below, the current range has been an area of resistance and support several times this year (highlighted in yellow).




We're buying the Dividend And Income Growth Fund (DNI).

We're not going to suggest it's a value play.  For us the bottom line is that if we're going to hold long positions we're wanting to get paid to do so given our belief that equities are generally very overvalued.  DNI is currently offering more than 11% yield based on the latest close of $13.96.

On the chart we see what we hope will continue to be a long-term supportive trend (in red), and we note that the past two years there has been price support just below $14:



Recent Payouts        

                                                 

AmountEx-Dividend DateRecord DatePay DateDeclare DateQualified? [?]Type
$0.4089/13/20139/17/20139/30/20139/3/2013UnknownRegular
$0.4086/13/20136/17/20136/28/20136/3/2013UnknownRegular
$0.4083/13/20133/15/20133/28/20133/1/2013UnknownRegular
$0.40812/12/201212/14/201212/28/201212/3/2012UnknownRegular


Per the fund's website:

Top Ten Holdings as of August 31, 2013:
 
1.L Brands, Inc.
2.Intel Corporation
3.General Electric Company
4.Bristol-Myers Squibb Company
5.3M Company
6.Energy Transfer Partners, L.P.
7.Johnson & Johnson     
8.Honeywell International, Inc. 
9.Merck & Co., Inc.
10.JPMorgan Chase & Co.
 
Top ten holdings comprise approximately 20% of total assets.










We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.


To be notified when this blog is updated : Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a blog entry only contains general commentary.

Tuesday, October 08, 2013

Weekly Market Outlook, Star Scientific (STSI)


On August 30th, after having been correctly bearish during the previous few weeks, we wrote:

"Markets are closed Monday per the Labor Day holiday in North America, and we remain longer-term bearish while still expecting a near-term bounce.  That bounce 'should' begin Tuesday..."

That Tuesday a rally began which took the DJIA 850 points higher over the following dozen trading days. 

The rally ended mid-day on September 18.  Earlier that morning, we offered some short sale ideas and wrote:

"Currently equities are very overvalued and sentiment is stretched to multi-year bullish extremes by some measures."

Over the following thirteen trading sessions, the market fell almost 800 points from the September 18 high.  Many have said this was due to concern over the so-called government shutdown in the U.S. but that's false.  The market was overdue for a fall as we'd asserted and it would've happened no matter what, just as it happened despite the continuation of QE announced on the 18th which shot the market much higher intraday.

Scoring our short sale suggestions, GMCR fell as much as 19%, Z fell as much as 18%, BBY fell 5% while TSLA has gone higher and well above our suggested stop.  We did participate in all of these ideas, mostly utilizing put options, and on net have come out well ahead.  As of yesterday, Monday the 7th October, we've closed these effective shorts as we now expect a market bounce. 


One of our long-term holdings is Star Scientific Inc. (STSI), which has not previously been diarized in this blog.  We hold it at an average cost, adjusting for profits from a few swing trades, of $1.37

We'll offer no opinion of the company's operations, product, claims or finances. If it interests you, read up on the company. It has a compelling product and big-name endorsers along with plenty of fans, touts, foes and naysayers, and has had a wild ride since going public in early 2000 just as stock markets began an epic tanking.  

Our interest here is purely technical:


Note the year-long downtrend broken and the current consolidation around $2.00  Typically such a pattern eventually continues upward. 











We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.


To be notified when this blog is updated : Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a blog entry only contains general commentary.