Friday, 27 February 2015

GDX - a rough month for the miners

With precious metals seeing significant weakness across February, the mining stocks were naturally impacted. The ETF of GDX saw a net monthly decline of -4.5% @ $21.28. There remains high probability that the lows from Nov'2014 ($16.34) will be taken out this spring.

GDX, monthly

GDX, daily


Suffice to say... after the net monthly gains of Nov-Jan, the miners... along with precious metals, are back on the slide.

New multi-year lows look due this spring.
It remains entirely possible that many mining stocks will see a further 30/50% lower between now and the late summer.

*holding to downside target for Gold of $1000, perhaps 900/875 by Sept/Oct. From there... a key floor, which would by default, be a time where I will be interested in being long both the metals.. and miners.

Thursday, 26 February 2015

CHK - continuing to unravel

Whilst the main market saw mixed chop, there was notable weakness in the energy sector. Chesapeake (CHK) settled lower by a very significant -4.4% @ $17.19. The bigger picture is offering a capitulation low in the summer, somewhere in the $12/10 zone.

CHK, daily

CHK, weekly


Recent earnings were lousy.. and it is no surprise to see CHK continue to implode.

With Oil prices looking vulnerable to breaking the recent $43 low (most bearish case remains 35/30 zone)... CHK looks set for broad weakness into the summer.

*I remain very bullish about CHK - and most other energy stocks, once we're past the summer. For now.. it is one to watch.

Wednesday, 25 February 2015

AA, CENX - big trouble in Aluminium

With Century Aluminium (CENX) failing to meet market expectations, the stock was slammed lower at the open. CENX and Alcoa (AA) both settled significantly lower, by -4.7% and -12.9% respectively. Near term outlook is bearish, and with both losing the 200dma, the broader outlook has also turned bearish.

AA, daily

CENX, daily


Suffice to say, CENX has really spooked the market, and its taken AA down with it.

With both losing the 200dma, outlook into the spring is starting to look pretty lousy.

Consider the giant monthly cycle for AA

$18 has been a key threshold to break, but with today's move into the $14s, AA is looking in serious trouble.

Most bearish outlook for summer...

AA: $12/10 zone
CENX: $10

Of the two... I'd favour AA, but right now... neither look remotely attractive... not least after today's declines.

Tuesday, 24 February 2015

AAPL - somewhat over-stretched

With the broader US equity market breaking new historic highs, Apple (AAPL) was similarly at new historic highs, but settling -0.6% @ $132.18 (intra high 133.60). Despite the current price action, AAPL is at long term trend resistance, a brief cooling to the 125/120 zone is very viable.

AAPL, daily

AAPL, monthly


*with just 3 trading days left of the month, AAPL has a very powerful net monthly gain of 13.3%, but then.. Q4 earnings were frankly.. superb.

To be clear.. a retrace is very viable... but broadly.. the trend is hyper-bullish.

AAPL remains grossly mispriced relative to the main market. Given another 24-30 months, AAPL will likely be trading in the $250/300 range... before the current QE/paper bubble blows up.

Without question, AAPL is arguably one of the top 3 stocks not to short. 

Monday, 23 February 2015

RIG, SDRL - just another bad day to drill

Whilst the main market saw minor weak chop, there was particular weakness in the Oil/drillers. Transocean (RIG) and Seadrill (SDRL) settled lower by a significant -4.5% and -3.2% respectively. Near term outlook remains very bearish, not least as WTIC Oil looks vulnerable to breaking the recent $43 low.

RIG, daily

SDRL, daily


*I'd refer anyone to the bigger monthly cycle charts for RIG or SDRL - as highlighted in previous posts.

Suffice to say, a bad start to the week for the oil/gas drilling stocks. The broader trend remains exceptionally weak. Whilst oil/gas prices remain vulnerable to breaking new lows, RIG & SDRL look similarly likely to break new multi-year lows.

**RIG has earnings this Wednesday.