Wednesday, 10 February 2016

DIS - the selling continues

Despite unquestionably good earnings, Disney (DIS) continued to slide (intra low $86.25), settling -3.7% @ $88.86. Near term outlook still offers high threat of a short term bounce to the 95/97 zone, but the broader outlook is clear.. headed lower to at least 80/75.


DIS, daily



DIS, monthly



Summary

*closing daily candle is of the reversal type, but having broken a new multi-month low, it should not inspire the longer term bulls.
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Q4 earnings for DIS were no doubt largely helped by huge box office receipts from Star Wars 7, yet that still wasn't enough to satisfy the market.

Clearly, EPS/rev' were fine, but in the current market, its still not seen as good enough.

Regardless of any near term bounce, DIS looks headed lower by another 10/15% - which would sync up with the broader market downside to the sp'1600s.


Special note..

A monthly close <$75 would bode for continued implosion to the old breakout level of $40. That would be suggestive of sp'1200/1000. For now... its something to keep in mind, if very unlikely.

Tuesday, 9 February 2016

GDX - daily reversal

With the precious metals reversing lower in the afternoon, the related mining stocks saw the first major net daily decline since mid January. The ETF of GDX swung from an intra high of $17.82, but settled lower by a very significant -4.0% to $16.77. Near term outlook is bearish as a retrace appears underway.


GDX, daily



GDX, monthly


Summary

Suffice to add, with gold/silver getting into seriously over bought territory - at levels not seen since Oct'2012, there was always threat of a reversal.. and we have seen that today.

Now it appears a case of GDX at least retracing to the 200dma - which is currently at $15.48.
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Seen on the bigger monthly cycle, there is a clear attempt by the mining stocks to break out of the primary downward trend that stretches back to Sept'2011.

For me, I'd like to see at least a monthly close >$18 to give a provisional bullish signal.

To give strong clarity/confidence, I'd like to see GDX >$20. Until then... it could easily be just another tease, as the mining industry is yet to capitulate.

... and capitulation WILL happen, just as it must for the oil/gas sector.
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*eyes on those gold/silver miners with large unsustainable debts.

Monday, 8 February 2016

CHK - facing the end of times

Whilst the main market settled significantly lower, there was even more extreme weakness in Chesapeake Energy (CHK), which imploded by 50% in early morning to a new low of $1.50, but settling lower by a relatively moderate -33.0% @ $2.05. Mid term outlook is... bankruptcy.


CHK, daily



CHK, monthly



Summary

It was a pretty wild day for CHK, with the stock being suspended in the morning, only to see the company issue a press release stating it had no intention to file for bankruptcy.

In terms of price, CHK has been in collapse mode since summer 2014, falling from a high of $29.37 to today's new low of $1.50...  a drop of -94.9%.

CHK has been on the 'disappear list' for many months, I don't expect it to be around beyond April/May. 

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The next obvious question is... after CHK disappears... who is next?

Friday, 5 February 2016

TVIX, UVXY - significant net weekly gains

With US equity indexes seeing sig' net weekly declines, the VIX was naturally on the rise. The 2x lev' bullish instruments of TVIX and UVXY saw net weekly gains of 18.7% and 18.5% respectively. Near term outlook offers renewed cooling in volatility, before first opportunity of hyper upside in March.


TVIX, daily



UVXY, daily



Summary

*first, an update on the VIX


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As for TVIX/UVXY, a rather powerful net weekly gain, but still well below the high from January 20th, when VIX 32s, and VIX was borderline 13s.

As ever, such instruments are for short term holds only, not least due to the endless problem of statistical decay.

If equities see renewed upside next week, breaking above the Monday high of sp'1947, TVIX will probably be in the low 8s again, if not the 7s.

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*I am seeking to go long TVIX from the sp'1960/80 zone, with VIX 18/17s.

I realise, considering this weeks equity declines, that seems difficult.

Thursday, 4 February 2016

FCX - hyper upside within a massive down trend

Whilst the broader market saw a day of moderate swings, there was notable hyper upside in many of the resource stocks that have been destroyed since summer 2014. Freeport McMoran (FCX) settled higher by 17.8% at $5.72. Broadly though, the company looks extremely vulnerable to disappearing entirely.


FCX, daily



FCX, monthly



Summary

Seen on the giant monthly cycle, the true horror is even more clear.

FCX has already been largely obliterated since the July 2014 high of $37.52.

Having decisively broken below the 2008/09 collapse wave low, FCX looks on its death bed.
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*the stock looks pointless to short from such low levels. No doubt, many retail amateurs are sporadically buying on the notion that one day it will again be trading back to the levels of summer 2011.. or even 2008.

I'm extremely doubtful it'll ever see >$10 again.