UCO Buy-Stop Updated

We're updating our UCO buy-stop to $12.20

If filled, we'll place a stop on a closing basis below $11.50

This article, Wall Street’s experts botched stock picks in 2015 – again, makes a good follow-up to our recent post "All Wrong...".

The last line is particularly worth remembering.  "Caveat investor, as always. There is no substitute for thinking for yourself."





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.

Long NUGT

As promised last posting, we're going long NUGT again at today's open. 

Initial stop will be on an intra-day basis below $22. 






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.

All Wrong, And Gold. UCO Update

Before the Wednesday Federal Reserve interest rate announcement we wrote:

"Typical action will be a rally lasting a short while, usually a day or two..."

What went up came easily back down, and despite a rally of over 600 points from the Monday low to the Wednesday close the DJIA finished the week at its lowest closing level of the past two months.  Factor that markets are typically bullish at this time of year, and this does not bode well for the bulls.

Speaking of bulls, in a recent Barron's survey all "experts" polled were bullish for 2016, with some offering wildly bullish predictions.  They're more BS'ers than bullish, we suggest, and our prediction is that they'll all be proven quite wrong, as is almost always the case when "experts" unanimously agree on market matters. 

One can't help but think of the "magazine cover indicator".

It's certainly possible that markets will rocket higher next year, but if that happens it's most likely to be from a much lower level.  In any case, there are no compelling fundamental reasons to be bullish at present, and no compelling technical reasons so long as the DJIA remains below 18000.

What is compelling is the developing set-up in gold and silver.  We'll be announcing a related long position soon.  It may take awhile to get the entry right, however once we do it'll be very memorably profitable. 

Recent gold-related posts:

Gold And Silver Charts - Friday, December 11, 2015

Another Look At Gold - Sunday, November 29, 2015


We're updating our UCO buy-stop to $13.00 







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.

Margin Debt At An Extreme

Today's minor U.S. Federal Reserve rate hike is of no real consequence. 

Contrary to popular belief, the Fed doesn't even actually set rates it merely follows rising or falling rates as set by the bond and treasury markets. 

Typical action will be a rally lasting a short while, usually a day or two although with light trading in this traditionally bullish season it could last longer, then a major reversal. 

As of today, despite the DJIA being up a massive 601 points since the low hit just two days ago on Monday morning, the DJIA is not even in the black for the year so far.  That's not bullish.

Also not bullish, in fact arguably quite bearish, is the level of margin debt. 

The above chart is months old, from early 2015, and since then margin debt has turned lower, as have stocks.  The DJIA's high (18351) was in May, and that high was only slightly higher than the high hit in early March (18288). 

It doesn't matter whether margin debt turns lower before or after equities, it only matters that margin debt remains in the red zone and now interest rates are rising, however slightly, with the promise of more rate hikes to come, economic indicators globally are in decay, and most importantly the bond market is on very shaky ground which also will not be helped by rising rates.

 






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.

Reasons To Remain Bearish

Reasons to remain bearish, per these MarketWatch articles:

Stocks are more overvalued now than at 2000 and 2007 peaks

High-yield debt meltdown is ‘so similar to 2007,’ Gundlach says

Jeremy Grantham says America’s economy stinks, and soon its stock market will too

5 things that show the junk-bond market is in big trouble

Why the junk bond sell-off is getting very scary






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.

Gold And Silver Charts

Below are charts of gold (represented by GLD) and silver (represented by SLV), showing a 4-year declining wedge pattern in each.

From Investopedia:

The wedge chart pattern signals a reverse of the trend that is currently formed within the wedge itself. Wedges are similar in construction to a symmetrical triangle in that there are two trendlines - support and resistance - which band the price of a security.

The wedge pattern differs in that it is generally a longer-term pattern, usually lasting three to six months. It also has converging trendlines that slant in an either upward or downward direction, which differs from the more uniform trendlines of triangles.

There are two main types of wedges – falling and rising – which differ on the overall slant of the pattern. A falling wedge slopes downward, while a rising wedge slants upward.

Falling Wedge The falling wedge is a generally bullish pattern signaling that one will likely see the price break upwards through the wedge and move into an uptrend. The trendlines of this pattern converge, with both being slanted in a downward direction as the price is trading in a downtrend.

Figure 1: Falling wedge pattern

Another thing to look at in the falling wedge is that the upper (or resistance) trendline should have a sharper slope than the support level in the wedge construction. When the lower (or support) trendline is clearly flatter as the pattern forms, it signals that selling pressure is waning, as sellers have trouble pushing the price down further each time the security is under pressure.

The price movement in the wedge should at minimum test both the support trendline and the resistance trendline twice during the life of the wedge. The more times it tests each level, especially on the resistance end, the higher quality the wedge pattern is thought to be.

The buy signal is formed when the price breaks through the upper resistance line. This breakout move should be on heavier volume, but due to the longer-term nature of this pattern, it's important that the price has successive closes above the resistance 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.

Oil Again

In mid-November we stated that we'd "close out of the [oil] position and re-evaluate it should crude close below $40 for three successive sessions".

Crude has closed below $40 for three successive sessions therefore we did close out of our related position as planned, losing 12%, however will re-enter a bullish oil position via UCO when it trades above $14.50 

Currently sentiment is extremely bearish and very bearish articles proliferate in the financial news.  Oil is down around 70% from the 2013 high and roughly 75% from the all-time high of 2008.

Eventually oil will skyrocket and related ETF's such as UCO will at least double, probably triple, over the course of a few months, and we intent to catch most of that action so minor losses via prudent speculating along the way isn't discouraging to us. 

We'll revise our entry point if UCO continues to drop significantly.

Here are updated oil charts:

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.

DJIA Chart Study

The DJIA is at the same level it was 13 months ago, and in the meantime it has gone as much as 783 points higher and as much as 2198 points lower. 

The plunge only took two weeks, while most of the rest of the time the senior index traded within a relatively narrow band of roughly 900 points, going nowhere. 

Whether this is a grand consolidation before a major spike higher or a massive top formation is anyone's guess, however the path of least resistance appears to be downward.

In the chart above the horizontal red lines show the consolidation of the past 13 months, while the black lines show the upper portion of a broken 6.5-year trend channel which stretches back to the start of 2009.







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.

Oil Charts Update, NUGT Stop Raised

Two weeks ago we presented these oil charts which we update below:

Very little has changed in two weeks, and our outlook and commentary remains the same as in the post linked above.  The COT (commitment of traders) section is worth studying.

Tuesday we entered NUGT and that position is already up almost 17%  We're raising our stop from $23 to $25 on a closing basis. 


 



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.

ETP, Energy Transfer Partners Yielding Over 12%

We went long ETP, Energy Transfer Partners, today at the close, at which price it yields 12.2%

Here's the chart:

Might we be early?  Yes, of course.  We like it as a very long-term holding however, so if it drops materially we'll gladly be buying more.  The chart shows possible long-term trend support as well as a general support level not far below its current price.  When using a 15-year chart, and with equities markets extremely overbought and overvalued, we must give those support levels a lot of leeway. 

Obvious caveats apply.  The oil & gas sector is far out of favor, part of the reason why we like it, and the dividend could always be cut which would not only reduce the yield but likely cause the share price to drop further as well.

We were arguably early on WPZ, Williams Partners LP, recently, and so too on NS, NuStar Energy.  We haven't yet bought NS, but likely will soon.  WPZ currently yields 13% while NS yields 12%.  We still like both. 

Below is the chart for NS, with possible support delineated.  Again, allow that support level leeway.

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.

Long NUGT

We're back in NUGT at $27 and it's broken above its highs of the past few weeks:

It's premature to go long perhaps, however the upside is too massive to ignore.  Of course the risk is high too, given NUGT is a 3x levered fund of gold miners. 

For now our stop is on any close below $23, seeking to tighten that up if the stock moves higher. 







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.