Riding The Gravy Train

Riding The Gravy Train

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

Tuesday, May 24, 2011

adding FXP

In this post dated December 04 2009 we announced buying FXP, the ProShares UltraShort FTSE/Xinhua China 25 ETF. Adjusted for subsequent splits, that entry price is $37.30

We wrote : "Its downtrend does not yet appear to be over, from a technical perspective, so in case it drops significantly we're planning to add to our holdings rather than stop out. Our thinking may change on that, but for now we feel increasingly certain that a turn in the global markets is imminent."

Global markets did turn lower and just 6 weeks later FXP was 43% higher. However we're looking for even bigger gains by shorting China, so we took no action and by summer 2010 that position was in the red as markets reversed again. Shame.

The good news is that now the 2-year downtrend is finally broken for FXP (also true of BZQ, another effective short we favor), so we add to our FXP holdings and if it should close below $24 we'll sell all of our accumulated FXP holdings.

FXP closed today at $27.90

BZQ closed at $16.26


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the stocks we do, or for mentioning any stocks or 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.

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, not if a blog entry only contains general commentary.

Monday, October 31, 2016

Shorting China, FXP Update

 
Earlier this month we shorted Chinese stocks via FXP, "The ProShares UltraShort FTSE China 50 ETF [which] provides -2x exposure to a free-float-weighted index comprising 50 of the largest and most liquid Chinese stocks listed on the Hong Kong Stock Exchange."

Here's an update on the FXP chart:


Having paid $30.15 for FXP, we're already up 5.5% on this position.

We're now instituting a stop level of $28.40 on FXP.


 
 
 
 


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, me, 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 posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Sunday, May 13, 2012

The Scenic Route

It's been awhile since our last post in this blog. Time for an update? Let's go back a year and move forward from there.

Last May we bought UUP, turning bullish on the U.S. dollar while the world was extremely bearish. Few things are safer in life than betting against mass sentiment, especially when that mass includes doom-mongers and all the neophytes adopting gold as their path to riches after a decade-long bull market.

As it turns out, we bought the dollar at the exact low. We remain very bullish and confident it'll go far higher.

Note that these charts can be clicked to see a larger version.


As seen in that post linked above, we were also very bullish HAO. That didn't go so well. It did rise 40% by the following month, with plenty of volume to sell into, but we didn't sell and then virtually anything gold or penny-stock related began a long, slow decline.

We'd expected that and had been predicting it correctly for some time, but we can't ignore a set-up as great as we had in HAO back then. It's now 50% lower, which is actually decent on a relative basis since most penny stocks in the resource sector are down 80-95% since then.

While we've called gains of well over 100% a great many times on penny stocks in this blog, the bottom line is that this one's been a failure for us. At least so far, and that's not likely to change any time soon if ever.

Also in that posting we wrote :

"For the next while we expect, generally speaking, to see markets and precious metals going down and the US dollar going up.

Those hoping to snag cheap silver as a long-term holding will wish to wait a few weeks and seek a price in the mid-low $20's. Aggressive speculators may try something in the mid-$30's, possibly as early as today and with an advanced understanding of the concept of tight stops and re-buying if need be. Those who bought recently in the $40's, especially the high-$40's, are completely reckless and extremely unlikely to ever make money via speculating."

This chart speaks for accuracy the first paragraph :


And we'll let this chart speak for the the 2nd paragraph quoted above :




Later that month we posted this strident warning.   The chart above of the DJIA proves how prescient this warning was.  As does this chart of Goldman Sachs :




Don't laugh too hard at the Apple short call, it proved profitable as subsequent posts will show when we recommended balancing it with a hedge. 

The suggestion to consider the leveraged market short positions proved extremely profitable for those who traded on it.


Finally, last May we added FXP which is an effective China market short.  A few months later, it was 100% higher though we booked profits much lower for a gain of "just" 32% on that half-position. 




In June we offered nothing new, or valuable, really. 

In August, we booked some big gains on short positions and entered TBT too early, though we warned "we'd not be surprised to see it as low as $20 but if it gets there we'll possibly buy more."  It went below $18 in fact, and has bounced around since.  We've not yet bought more, nor do we plan to soon.  If markets continue lower, which is quite possible, TBT might hit the $12 range.  We'd be tempted to add then.     

In August, as seen in the link above, we also wrote that "it's a great time to short silver" and we did so at virtually the exact top (see SLV chart above).  We also wrote that "Gold is up nearly $200 this month so far, as a "flight to safety" which ironically will eventually prove to be anything but safe, as is everything else that goes parabolic including silver when it was at $50 at the beginning of May. Gold might not be at a top yet, but silver was in early May when it crashed and now its bounce seems over and the next leg down begun." and "we're of the very unpopular belief that silver below $30 is not far off."

Silver crashed to below $30 just weeks later, and gold marked its high that month.  Going forward, for both "precious metals" the phrase "new low" will probably be heard much more often than the familiar "new high" of the past decade.

The ZSL calls suggested were soon up hundreds of percent.  The TNA calls suggested never came into play for us as the "one more big downward move" we were waiting for didn't happen until 2 days before the August options expiry, which was too late.  Plus the bounce we were expecting had already happened, with TNA popping up 27% in just 3 days.

In September, we sold half the ZSL silver short position for 62% gains and further commented on silver through the month.

We were back in November, booking gains and commenting on China, as well as re-loading our China short to a full position and rescinding our previous stop.  A couple weeks later FXP was over 30% higher but we held on, and shortly thereafter it was below the "well-defined support" we'd cited.  Now it's back above our entry level and it's starting to become better known in the mainstream, and officially admitted to some degree, that the China economy is in trouble but we're of the firm conviction that a lot of rot remains hidden.

On a logarithmic scale, we find that FXP is just $1 under its almost 4-year long major downtrend, and $2 below its 200-day moving average.  Perhaps the China market bounces and FXP drops from this technical resistance above, but if not then it's a must-buy above $30.  We might add to our position in that case, with stops on the additional short entry on closes below $27.  We've no stop on our existing long-term short.

In December our only posting was an outlook for 2012.  At this point everything we mentioned in it is at roughly the same level it was when we made that post.  We've yet to take another short position on Brazil.  Too bad, as BZQ is up over 50% since early March so we probably missed the boat for now.   Timing is everything ...

Which brings us to January, a month in which we went long GS when virtually everyone was bearish and we booked a good gain just two weeks later but too early as time would tell.  It's now lower than our exit however, yet we're not considering a re-entry at this time.  Aggressive speculators will consider our outlook for 2012, linked above, and perhaps go long GS with the stop levels we'd offered in mind as those still apply in our view.

The Best Buy short we suggested near the end of January was well-timed.  Here's a chart :


But timing also worked against us.  We prudently lowered our stop level before the March spike in price and were stopped-out with a very small loss (1%).  Being totally correct in our thesis doesn't make it a given we'll make money trading on it.  No regrets using prudent stops though.  Those who remained short are sitting very pretty, and we suggest might wish to book at least some profits unless they're intent on riding out volatility and holding until the bitter end.

The VIX calls turned out to be basically a bust.

February.    We were again early shorting Apple and this time took a loss of around 5%.  It finally topped about 6 weeks later.  Could go higher, certainly.  Could also be at its all-time highs. 

We were also early re-loading on our silver short ZSL, losing roughly 4% when stopped out.  It's now much higher, but at least we still have half our original short position (see above) and the 62% profit we booked on the first half more than made up for the small loss on the re-purchase of that sold half-position.  Again, no regrets using prudent stops.  That policy saved us potentially massive grief and loss on AAPL. 

Against widespread belief, we predicted in February that there would be no "QE3".  We received several questioning emails and even mockery over that call.  So far, there's been no QE3 nor will there be we believe.  Even if there eventually is such a move, the 3rd time won't be a charm - it'll be too late and prove to be too many trips to the proverbial well, in our opinion having virtually no effect in the real economy or in the stock market. 

In March we offered general commentary, but no trade ideas.  SRG popped nicely from our entry, and we remain bullish on it with an over sized position (for a penny stock). 

In our paid advisory we went short gold in the last week of March and that's paying off well.  We've subsequently been made aware of a gold advisory service that boasts a better record on trading gold and silver than we do. We'll give it a shot as subscribers and report here in the future if we feel it's also worth your consideration.



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 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, not if a blog entry only contains general commentary.

Wednesday, November 09, 2011

FXP 2nd position repurchase

Click this text for background info on this trade idea.

FXP went another $1.52 higher before dropping over 20% during the subsequent three weeks. Unfortunately we didn't repurchase at that time, as it then rallied over 70% in a month!

Then it dropped 50% in five weeks, which not only clearly illustrates the big and fast profit AND loss potential in levered instruments but brings us to today.

The fundamental and logical reasons to be bearish China are not only intact but mounting. The technical basis for further shorting is at best dubious at present, but such is the case always at inflection points.

We may or may not be at such an inflection point now, however in any case we're repurchasing that 2nd effective China short positon represented by FXP which closed today at $26.07 That is roughly $1.50 above its all-time low hit in late April of this year. A slightly higher low was also hit last November, in early April, and in late May, so as a technical support level the $25 area is very well-defined and a significant break below that area would perhaps cause us to become neutral for awhile pending a better technical setup in the future. Time will tell.




We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the stocks we do, or for mentioning any stocks or 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, us, they, them, 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. 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, not if a blog entry only contains general commentary.

Tuesday, October 11, 2016

Shorting China via FXP

 
Below is a chart of FXP, "The ProShares UltraShort FTSE China 50 ETF [which] provides -2x exposure to a free-float-weighted index comprising 50 of the largest and most liquid Chinese stocks listed on the Hong Kong Stock Exchange."


The downtrend, in green, seems broken.

Today we bought FXP at $30.15

We've no stop in mind for the time being. 

 
 
 
 
 


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, me, 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 posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Monday, August 08, 2011

selling FXP +32%, BZQ +45% & buying TBT

A quick update on past entries diarzied here.

FXP is now 32% higher than our 2nd entry in late May. It'll at most go up another couple dollars, we believe, before a material correction, so we're selling that 2nd portion while keeping the original position which is at roughly break-even from our entry in December 2009.

BZQ is up 45% from our entry in late May. It'll probably go much higher in time but for now we'll step aside and book these gains.

We'll go long TBT, an ETF which is double-inverse to the 20-year U.S. Treasury Bond. It closed today at $26.62 and we'd not be surprised to see it as low as $20 but if it gets there we'll possibly buy more. For now we'll just hold this position awhile and if we're blessed with a quick price appreciation we'd book it and update the blog.

Those who shorted Apple on our suggestion were stopped out for a loss of just under 6% and those who hedged it with a market long as we suggested in the link below came out well ahead on the pair trade as BGU was up 22% when the Apple short was stopped.

No other changes, and certainly no surprises with respect to the recent market action per this commentary published just days after the apparent market high for the year : http://ridingthegravytrain.blogspot.com/2011/05/goldman-sachs-share-price-signals.html

A follow-up can be read here : http://ridingthegravytrain.blogspot.com/2011/06/update-fxp-bzq-qid-faz-aapl-hao.html Indeed a market rally began immediately after we predicted it, which turned out to be one of the biggest weekly gains in many years.

Early in the last week of July, subscribers to our paid advisory were given a short-term sell signal which remains in effect today. By the beginning of this month even our conservative readers were signalled to be short or hedging longs, and anyone reading this knows what a lucky call that seems to have been. We refer to these as "signals" because we use a proprietary indicator that does a reliable job of catching market turns in different time frames. Speculators follow the short-term signals, while investors consider the longer-term signals.

At this stage our thinking is that gold and especially silver are marking tops of some duration, as are bonds, while equities are still overvalued but due for a big bounce. We remain very bullish the U.S. dollar, though we'll change our minds on material weakness and if so we'd sell out of our May 5th entry into UUP.



We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the stocks we do, or for mentioning any stocks or 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.

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, not if a blog entry only contains general commentary.

Friday, December 04, 2009

buying FXP, visual treats

Click this text for a short but fascinating photo journal of yet another hype-fuelled bubble/scam that has bit the dust, "Off the Deep End: A Look at the Decline of Dubai"

Speaking of hype-fuelled bubbles, we go long the ProShares UltraShort FTSE/Xinhua China 25 ETF, FXP which closed the week at $7.46 This is essentially a levered short on the Chinese stock market and economy.

"ProShares UltraShort FTSE/Xinhua China 25 (the Fund) seeks daily investment results that correspond to twice (200%) the inverse (opposite) of the daily performance of the FTSE/Xinhua China 25 Index (the Index). The Index consists of 25 of the largest and most liquid Chinese stocks listed on the Hong Kong Stock Exchange (HKEX). This free float-adjusted Index caps the weight of any of constituent stock at 10% to ensure broad representation of the Chinese economy. The Fund takes positions in securities and/or financial instruments that, in combination, should have similar daily return characteristics as –200% of the daily return of the Index. The Index is a price return index. The Fund’s investment advisor is ProShare Advisors LLC."

Its downtrend does not yet appear to be over, from a technical perspective, so in case it drops significantly we're planning to add to our holdings rather than stop out. Our thinking may change on that, but for now we feel increasingly certain that a turn in the global markets is imminent.


More photo journals, these of Chinese pollution :

Click

Click

Click




Lightening up a little, some fine video entertainment !






We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the stocks we do, or for mentioning any stocks or 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.

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, not if a blog entry only contains general commentary.

Saturday, June 18, 2011

Update - FXP, BZQ, QID, FAZ, AAPL, HAO, UUP

Herein we update recent trade suggestions.

Those who followed our lead in purchasing FXP on May 24th or the week after were up between 4.5% and 14.5% at Friday's close. Markets continue to look weak, but a rally is due so it may be prudent for some to book these profits. We will not close the position at this time.

FAZ is now over 13% higher, QID 14% higher, and BZQ at the same level as when we suggested these as good speculations in our post dated May 21 entitled "Goldman Sachs Share Price Signals Danger."

Perhaps ironically, Goldman Sach's share price is slightly higher now than it was then, which in part is why we suspect a rally imminently.

AAPL, which we like as a short, is over 3% lower and showing relative weakness to the overall market. It closed Friday below its key 200-day moving average, and down for the calendar year thus far. The NASDAQ Composite is also below its 200-day moving average and is down for the calendar year.

We'd keep the APPL short while hedging it with a long bet on the overall market, via purchase of BGU and holding it on closes above 69.20 BGU closed Friday at 73.51

HAO, trading on the Canadian Venture Exchange, recently hit a high more than 40% above our April entry. We're still holding.

UUP is also doing well for us. We're still holding, and still very bullish on the US Dollar.


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the stocks we do, or for mentioning any stocks or 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.

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, not if a blog entry only contains general commentary.

Tuesday, June 08, 2010

selling UUP +16% in 6 months (DRR up 59%), buying URR, gold & silver chart & commentary updates

Six months since our last entry. The markets have gone lower, as we'd repeatedly warned would happen, and have taken a very volatile path in getting there. Gold has essentially gone sideways, and it too has taken the scenic route, moving exactly as we'd predicted both up and down. We revise our gold chart today with thanks to those who have written to ask for an update.

We were bearish China while most everyone else were raging bulls. See our December 4th 2009 posting immediately below and correlate it to these charts of the Hang Seng and of our recommendation FXP.

On December 4th we also suggested the purchase of UUP, which is a bullish position on the US Dollar. At the time US Dollar sentiment was totally bearish and we were the only commentators advising to go long the US Dollar and short the Euro (see commentary on DRR the Double Short Euro ETN dated November 18th). Readers who check the charts for those tickers find that we called the exact reversal points.

Now we're selling UUP for a gain of roughly 16%. Anyone in DRR should also sell we believe. It is up 59% since our mention.

Being short China and long the USD have been arguably the best and most comfortable positions to be in the past 6 months. Now these trades are very crowded, and as always we are nervous when the masses are on the same side of a trade as us, thus we seek to book our profits.



We remain longer-term US Dollar bulls and Euro bears, but believe an intermediate-term reversal in both is imminent. Thus we speculate via the purchase of URR, the Double Long Euro ETN which last traded at $23.14 We'll sell to close the position after any close below $22 and a following morning's open below that same $22 level.

We remain longer-term China stock market bears and continue to hold FXP as a hedge.


As for gold and silver, here is the silver 5-year chart and trends as posted in this blog over 6 months ago.




Silver today.




As is obvious, silver has not confirmed gold's new highs. Far from it. Also obvious is that silver remains in an upwards bearish wedge, and below a significant level of past resistance (in red, horizontal). It looks as though at best silver will rise to around $20 ~ $22 before a very big and protracted drop.



Gold 5-year chart and trends with Elliot Wave Labelling, as posted in this blog 6 months ago.



When we posted the above gold chart, we wrote that gold was likely to pull back to circa $1050 before rallying to new highs. That is exactly what happened, and as seen in the chart below the moves have exactly adhered to the trendlines we'd drawn.

Gold today.



Note that gold in the $1250 ~ $1350 range fulfills both the Elliot Wave labelling and the supposed "head and shoulders bottom" gold put in between early 2008 and finally breaking above $1000 decisively in mid-2009. It would also then be at the top of a bearish rising wedge illustrated bu the upper black line and lower green line. It would further coincide with silver at best rising another $2 or so, and with a near-term (but not long-term) reversal in the US Dollar.

Lastly, this also coincides with a protracted decline in global stock markets, which is still underway and likely to last years. Gold may enjoy a brief "flight to safety" at first, and has so far as the bear market has resumed, but recall in 2008 how gold collapsed along with equities. This time will not be different and the extreme positive gold sentiment also suggests we are at or near a top of some duration in gold and silver.


All speculation of course, but speculating is what we do and we do it well. In fact, we know of no other outlet at any price (much less free) that can boast a record such as ours.

Understandably this attracts attention, and those who read our December 4th entries may recall that we suffered an outage and loss of access to this blog for a few days back then. To us this was totally unacceptable. We said we'd take action and we did.

Readers have been writing to ask us if we'd quit writing about the markets. Thanks for caring. No, far from it. At that time a market newsletter of good repute but very low circulation contacted us to offer us a publication under their banner. We accepted, and our focus has understandably been put on that effort.

While we expect to maintain this blog going forward, the postings will be few and far between as our best and most timely efforts must of course go to paying subscribers of the letter we now co-write.

The results we've attained there mirror those we enjoyed for years here, and so too the accuracy and original chart work and commentary.

Readers of this blog who may be interested in subscribing to that letter may contact us via email (you will find the address below, at bottom of this post) to request a link to a special pricing offer for that publication.


In closing here we copy what we sent to our paid readers in early May, as we believe it is still very true : “Stock markets are extremely fragile. This is not the time to try to buy on dips, or to be deluded into the belief that equities or dividend yields currently, or anytime in the near future, represent value."



We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the stocks we do, or for mentioning any stocks or 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.

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, not if a blog entry only contains general commentary.

Tuesday, November 22, 2011

selling FXP +24%, China Manufacturing Drops

More good news for our two levered short positions on China.

Click this text to read "China Manufacturing Shows Contraction".

We'll try to sell the most recent entry for no less than $34.84 which is 24% higher than our entry just two weeks ago. For more on that, see the posting below in this blog dated November 09.

When we diarized the trade, FXP was at $26.07 but when markets next opened it was unfortunately much higher at $28.10 so that's our entry price on this 2nd position.

We'd not want to be without a China short position, but markets may be due for a bounce so we'll book this big, fast gain and possibly re-enter this 2nd China short position later.







We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the stocks we do, or for mentioning any stocks or 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. 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, not if a blog entry only contains general commentary.

Thursday, May 31, 2012

China Manufacturing Falls Sharply


"China manufacturing activity barely expanded in May, data showed Friday, with the official version of the Purchasing Managers’ Index dropping sharply to 50.4 from 53.3 in April."


Click here for the full story.

We've been bears on China since people were laughing at us for being so, and while no one is laughing now we remain bearish and accordingly are long FXP.




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 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, not if a blog entry only contains general commentary.

Thursday, May 17, 2012

More Bad News for China


The ugly reality continues to be revealed with respect to China's economy.

This is great news for our existing effective short on China, via FXP.  We've been consistently bearish China for a long time, scoring great returns by investing along that thinking, and that shouldn't change any time soon.

We also continue to be big proponents of shorting Brazil, and that's paying off well lately for those in BZQ. 
Tuesday evening we posted a silver chart that suggested a bounce was due.  Wednesday silver fell to the support we indicated on that chart before rallying into the close of trading, then gapping higher and rising again today.   This bounce could last awhile, however we doubt silver or gold have hit 'the' bottom yet.



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 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, not if a blog entry only contains general commentary.

Monday, June 24, 2013

Mid-Year Update, GS, AAPL, TBT, Gold, Silver


Our 2013 Outlook appears accurate, and the mid-year mark seems a good time to review it. 

In the items below, the year in parentheses is the year for which the call was made.  So "(2012)" means that was the forecast at the end of 2011 for the year 2012, and "(2013)" is the review of that forecast and updated call made at the end of 2012 for the year 2013. 

The forecast for the year appears within quotations and is italicized.  Our update today for each item begins in bold.


"1. We wish a very happy, healthy and prosperous 2013 to you."

"2. (2012) We should continue to do well in the new year with our core positions and ideas ; short China, short gold and silver, long U.S. dollars. Short Brazil looks good to us too, but we do not yet have a re-entry on that position.

(2013) We were wrong on all of #2 though all were essentially flat.  No idea about 2013, but if we have to guess we'd say the same as above
."

Our usual China short, FXP, is up 55% so far in 2013. 

Gold (GLD) is down 24%, silver (SLV) is down 38% and our remianing silver short (ZSL) is up 121%. 

Our preferred USD long (UUP) was recently up 5.5% which is a lot for a currency position, and is currently up 2.9% from January 1st.

Our preferred Brazil short (BZQ) is up over 70%

Going forward, we remain comfortable with this outlook however at least some of these gains should be booked.


"3. (2012) At some point in the future, perhaps in 2012, a long-term trend change in U.S. interest rates will happen and TBT will rocket. We diarized an initial entry in TBT in early August, too early and at too high a price. At the time we wrote that "we'd not be surprised to see it as low as $20 but if it gets there we'll possibly buy more." TBT has spent the last three months between $17.50 and $23 but we've not added to our position as we fear it may go much lower still. Those without a position may wish to speculate on an initial or partial entry at current prices.

(2013) Factoring in the 1:4 split in 2012, those prices quoted above should be $80, $70 and $92 respectively.  TBT began 2012 at $63.45 (split-adjusted).  It then did go "lower still" and by mid-year looks to have bottomed and the "long-term trend change" we mentioned may have begun. We remain long-term bullish TBT
."

Here's a 2-year TBT chart, which shows we called it correctly:


TBT should continue higher after a pull-back.



"4. (2012) We're neutral on U.S. equities at present. Our macro market calls have generally been excellent in this blog, and in our personal accounts we normally trade in accordance with those views. Equities at present are extremely overvalued on a fundamental and logical level, and a massive tanking in equities would be nice in the sense that it'd punish the complacent and provide sane pricing for the prudent, but that doesn't mean a massive rally couldn't currently be underway which wipes out the bears, thus we trade based on technical and trend considerations rather than fundamentals. Time will tell, and we'll try to trade the swings successfully along the way. When we've a firm opinion on upcoming market direction, we'll post it.

(2013) Equities did continue higher, wiping out many bears, and have been flopping about ever since.  Markets remain extremely overvalued
."

Markets were extremely overvalued at the start of 2013, and over the first 5 months of the year became much more so. 

As we demonstrated last post, we eventually became fully short hours before the year's high (so far?) and the DJIA has dropped 6.5% in the month since.  Markets remain extremely overvalued, but that doesn't mean they cannot go much higher.  It just means there are few, if any, true value positions to be taken.   


"5. (2012) We believe fear over the euro situation is mostly mass hysteria, and it'd be very good for western economies in the long run if there were to be an end to the common currency with banks and bondholders taking their deserved lumps. For once we'd have truly "free markets" but instead we'll probably suffer continued "extend and pretend" jawboning and policies, thus perhaps a continuation of the past eleven months of wildly-swinging markets.

(2013) Nothing was settled in Europe, and nothing has changed.  It was indeed much ado about nothing, and like the ridiculous U.S, "fiscal cliff" hysteria, is not worth our attention or conjecture
."

Exactly correct. Even the "bank crisis" in Cyprus (remember that?) proved to be of no consequence. 

At the time we wrote: "Cyprus [is a] non-issue [...] European events continue, as they have for years, to be of no apparent concern to investors and we shouldn't be surprised to see markets once again at new all-time highs in the coming days."

A few days later the market was indeed at a new all-time high and by two months later the DJIA was 1000 points higher.


"6. (2012) An observation : the Dow Jones Industrial Average is currently at the same level as it was mid-February, early and late March, mid-April, late May, mid-June, mid-July, early August, late October, mid-November and early December.

(2013) It was at that same level in mid-2012 and could easily be again before too long
."

That seems premature, in hindsight, let's even call it wrong ... for now.  We still believe markets will be much lower than at the start of 2013.  The question is "when", and for that we have our lines in the sand...


"7. (2012) Early in a new calendar year markets will often establish a tend and continue from there in the same direction. Roughly 12250 in the DJIA has been a good over/under line since February and might continue to be, meaning for the long term we should on net think bullishly above that line and bearishly below.

(2013) That proved an excellent strategy, as the DJIA was below 12250 for only 3 days mid-year.  For 2013, that over/under line is 13000.

8. (2012) Another good litmus test is Goldman Sachs (GS) below $87.50 being very bearish for the market overall, and below $100 mildly bearish. Bullish above $100.

(2013) This year: bullish above $112, mildly bearish below, and extremely bearish below $100.


9. (2013)  We'll add the litmus test of AAPL <> $500."

Anyone who stayed long while the DJIA was over 13000 should've made a killing this year, much more so if they turned fully short when we did at the exact highs so far. 

In late April we warned of a "pending equities dump" and updated the over/under lines for the DJIA and GS to DJIA 14550, GS above $137 bullish, below bearish, below $125 extremely bearish.

Today's low for the DJIA was 14551 and it's highly likely a bounce is underway.  GS remains well above $137. 

At times we seemed to be the only Apple bears, but with the stock having collapsed almost 45% while markets overall kept hitting new all-time highs, there are now a lot of bears so of course we're considerably less bearish. 

Call us neutral, but not bullish AAPL in the longer term.  A bounce seems due in Apple shares and for those having waited to cover shorts or for a good long entry point, now is a good time:




Gold and Silver:

Again referencing our last post, while precious metals did not drop on Friday they did on Monday and we added to all of the positions we'd listed. 

The chance of a bounce is now 80% in our estimation, which means there's still a very high chance of a further collapse in which case we'd top up the positions further.  A 20% chance of a continued collapse is huge, especially when speculating using levered positions and options as we mostly are. 

Playing this bounce, should one even occur, is for consistently successful and disciplined speculators.  Those trying to get rich quick or make up for their past losses should have nothing to do with it.  In fact, they probably went "all in" last week or last month and are now answering margin calls, or perhaps begging friends and family for funds or even filing for bankruptcy.  If not now, they certainly will someday if they persist in such reckless speculations.  Don't let it happen to you. 

Be prudent and stay hedged.

















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.