Saturday, 31 March 2012

POT - whats not to like?

Potash Corp' has fallen into a narrow range over the last 2 months, it now seems set for a minor breakout to at least $49/51 in April.

POT, daily, near term

The MACD cycle is ticking lower, but - if the main market can start aiming for sp'1440, then POT should at least hit $50.

POT, weekly, 5yr historic

POT is still way below its 2008 bubble peak. The MACD cycle is marginally bearish, and from a price perspective, its a somewhat worrying clear bear flag.

So, near term POT looks okay for some upside. Mid-term, if market can hit my now much-touted sp'1550, then maybe POT can get back to the 2011 high in the low 60s. The weekly cycle is a little concerning though.

I personally hold to the underlying super-bullish LONG any and ALL agricultural 'stuff' across the years, and decades ahead. Food is the ultimate in consumer needs, and with now 7bn people out there, we're going to need all the chemical help we can get.

PCX - Coal Miners suffering badly

The Coal Miners are one of the worse performing sectors for some months now. There is a fair bit of talk that this weakness is due to the perceived 'China slowdown'. They sure like their coal in China, and Zerohedge did a good report this past week showing that domestic power usage is back to July 2009 levels - a very good indicator of whats really going on there.

PCX - weak weak WEAK!

Still a very general down trend in occurance, I guess it could get a little bounce soon enough for early summer - not least if SP' 1550 occurs. However, I'm in agreement that if China - along with Europe, are seeing renewed economic weakness, that coal prices will remain weak..and the coal sector will continue to reflect it.

I'd assume if that's the case, that PCX will end up around $3 or so later in the 2012 - at the next major down cycle (sp'1300/1150?). At such a low price, even whilst it is putting in even further losses, it'd sure make for a tempting long term speculative buy.

Friday, 30 March 2012

GDX, miners digging out of a hole

Miners ETF look like today was probably a turn day...

GDX, daily

A move back to that upper channel line of 54/56 looks very viable for mid April. I'm still super bearish across the mid term for the would be...somewhere in the 30s.

Thursday, 29 March 2012

TVIX.. keep on buying, you maniacs

TVIX..along with the other VIX 'instruments' (which is about as polite a term as I can use for them right now) had a very turbulent day. After a strong open, it rolled over, and ended with a black doom candle no less.

TVIX, daily

The maniacs who have been buying - not least those averaging down, since Monday, did not get the close they wanted today. Not only did the indexes claw back up, but the VIX closed flat - with a black 'fail' candle too.

Friday, I'd guess there is a real chance for a 10/15% fall for TVIX. If the rats panic..then why not 25%?

AAPL - they can't stop it!

AAPL is becoming the unstoppable 250,000 ton super-tanker.

Everyone can see it still crawling up, day after day...after day, and many do understandably fear to chase it, but the higher it goes..the more fear those same investors have...of missing out.

AAPL, daily, near term

Good support on the 10MA at 601...upper bol allows 640 at any time in the next week or so.

650s by early April seem viable. I guess if 'better than expected' earnings in April, and if SP >1450, then AAPL could easily be in the low 700s. Yeah, 700s. Yet, as repeatedly noted, relative to the main market, AAPL would need to be $900/1000 just to be on equal terms with other company valuations.

Yet, is AAPL not one of the better companies out there? If so, then it would by definition deserve a rating better than the average, implying $1100/1300 later in the year.

Maybe if they do hit the big $1000, they will do a 5 for 1 stock split. Its something AAPL should have done when it first passed $300.

ET - my target is 0

Exact Target - provider of 'interactive' marketing solutions (aka, junk mail etc?) was listed just last week. In just the first 5 trading days we've seen a spike high, 2 black doom-candles, and today, we have our first red close.

A red close...and it won't be the last.

ET, daily

In all seriousness, no, I don't truly expect it to hit zero, at least not in the near term. Yet, does anyone really know if this nonsense even makes a profit? Does it have a net cash in-flow? Or is it just a black hole for anyone who puts capital into it?

So whats the 'real' best guess target for ET? Absolutely impossible to say. Assuming the market can crawl up to sp'1550 across into summer, then ET would likely hold up okay, but by Autumn of this year, will this be struggling to hold into the low teens?

As ever, earnings are what matter, so..from a watchers point of view, lets just see what they post in the next quarter.

It will certainly be one to watch from time to time, but purely for entertainment purposes, as a reminder of the high volatility and arguably 'mystery' factor inherent in these IPOs.

Wednesday, 28 March 2012

TVIX, it only took the maniacs 48 hours to forget

Thursday, Friday, and this past Monday were true days of horror for the various VIX trading instruments - not least the infamous TVIX. Even the clown channels were talking about how much a failure the various VIX instruments have turned out to be.

Well, it only took the maniacs 48 hours to completely forget just how awful VXX, UVXY, and TVIX are, they were buying it by the shovel load today.

The fact that all 3 ended well below their intra-day highs is of no consequence to the maniacs. They are probably still buying in after-hours trading this day, and some will even be buying Thursday pre-market - not least if the market is up. They will think they are getting a 'bargain'.  Sigh.

TVIX, daily

There was strong buying volume today. How long before they all get kicked/stopped out? Considering the 60min cycles on both the indexes and the VIX, it looks like tomorrow that many of them will get the boot.

The recent targets I have stated of as low as $1 equivalent on TVIX still seem viable, if Sp'1550, VIX <11 by late June/July. As ever....we'll soon see!

One thing IS for sure...they will decay...and keep decaying.

Tuesday, 27 March 2012

AKAM - snap higher...due

AKAM found some nice support at the 34.50 level, and with the MACD cycle due to go positive cycle this Wednesday, a move to around 41/43 by mid April is expected.

AKAM, daily

*I do consider AKAM a prime takeover target, although as with anything, it might never happen.

AKAM remains one of the strongest tech' companies out there, good sound numbers, and no sign of trouble in the mid term it'd seem.

AMZN - breakout

AMZN broke out of its triangle 5 days ago, today confirmed that move, and we now have a clear break.

AMZN, daily

AMZN's next key level is 220/225. That looks attainable within 2-4 weeks. The underlying problem remains, what will earnings be? AMZN profit margins are so very thin, can it put in better numbers, or will this burst upward merely be a great place for a short-trade?

It does remain a very risky stock to short, and today's action certainly caused more trouble for those short the stock.

AMZN is the stock I am most curious about for next earnings quarter.

Monday, 26 March 2012

AAPL...cruising upward

Just a short note on AAPL

AAPL, daily

AAPL remains right on track for $625/630 by end of this week. Upper bollinger/channel line is pretty much supporting that outlook. $625 easily opens up mid 600s by mid April...maybe even low 700s by end April - if SP'1450+, and if those earnings numbers are at least in-line with what the algo-bots are expecting.

Again, as so few in the bear camp wish to acknowledge, relative to the main market, AAPL is ....45% undervalued.

TVIX - the massacre continues

A new week, a new day..and another massacre for the TVIX

A long Monday ahead, but 5s seem very possible today.

The Knife catchers from last Thursday and Friday.....yeah..they are getting wiped away again today.

TVIX...failed left alone, merely useful for 'entertainment purposes'.

Sunday, 25 March 2012

AAPL - lets get one thing quite clear

Perspective from a Permabear

This will be an odd posting, coming from me, but as ever, I am trying to be balanced and endlessly touting over-valued stocks gets tiresome after the 1000'th post. More than anything in the last quarter century, I've always been the one touting 'fair value' for something, so lets consider what is without question the ultimate tech' stock right now in the world.

There has been endless talk over AAPL over the last 4 months since it finally broke upward. Some say the recent breakout is reminiscent of SLV for instance. Sure, the charts look the same, but then..what about 'fair value'?

AAPL, daily, near term

Some basic stats on AAPL: see.

Lets get this absolutely clear about AAPL...

Compared to the rest of the lunatic market, AAPL is cheap. In fact, it remains roughly 45% under-valued relative to the main indexes.

Now, my 'fair value' for even the best growth stock in a depression era - which I'd argue we are in, would call for a PE no higher than around 10, 12 at the very most.

AAPL is currently valued at 12 - based on forward earnings expectations.

The current SP' P/E ratio is around 23/24.

Unlike most of the over-hyped crazy momo stocks out there, at least AAPL does have worldwide customer acclaim, excellent profit margins of 25% (net), and what appears likely to be at least a few more years of good growth ahead - and that would STILL largely be the case regardless of any significant economic down turn.

Near term prospects

MACD daily cycle is headed down, and we may go negative cycle within the first few days of this coming week. Yet the 20MA of $563 (soon $570) will likely hold, and then we can make a challenge for the mid 600s by mid April.

All things considered, AAPL is already at 'fair value' under my rules, but the market that we exist in may easily take AAPL to the grand $1000 level within the next 6-18 months. To many readers, that may sound like the sort of crazy talk you'd hear on one of the financial clown channels.

As a Permabear, I can only note again, that I could list off a hundred or so companies that are probably 75% over-valued, but I'll leave that for another time.

In the meantime, anyone shorting the worlds greatest tech' growth stock, would do well to have a stop in place. After all, being short AAPL all the way up to $1000 would not be the best of positions to have in ones trading account.

Good wishes

           never bought a single AAPL product....(although that IPAD'3 sure looks kinda nice, just a shame the stupid design does not allow user-replaceable batteries..urghh!)

Saturday, 24 March 2012

TVIX..and other failures

The much touted P3, the 'wave of doom'..whatever you want to call it, has not happened, and right now, doesn't even show any sign of beginning. The doomers (or raging depressive maniacs?) are still being systematically wiped out. There really can't be that many left now.

The VIX - mid-term decline, single digits to come?

The VIX itself is merely a calculation, I won't cover all the details of what it really measures (many have already published plenty on that aspect), and I'm not even sure it matters too much in the scheme of things. Suffice to say, the VIX is merely an indicator of the prices people are paying for options - which often can be a guide to underlying market mood/price volatility.

Playing the VIX itself is of course impossible, but the financial institutions sure have come up with some truly wacky and creative solutions to such a problem.

The VXX - plain 1x LONG VIX (short term futures ETN)

Despite the huge rise - as a result of last summers major down cycle, the VXX is suffering from accelerating decline. Until the TVIX appeared, VXX was always my favourite ETN to highlight as the worse thing any trader can meddle in. The VXX has consistently failed to match good up moves in the VIX, and has merely decayed across the mid-term - even though its not leveraged!

TVIX - 2x LONG VIX (short term VIX futures ETN) 

*I've left the original 'bullish targets' on this chart, as well as what was the important floor of 14. I think too many chartists sometimes are too quick to remove old levels/remarks, in fear of looking stupid.

So, the TVIX has collapsed over a 2 day period of horror, from 14 to around 7. There is lots of talk out there about how TVIX diverged from its net asset value, but I'll leave that for others to discuss.

What is clear is that TVIX has FAILED. It is not only suffering from statistical decay, but the regular rolling of futures contracts is causing havoc. I'm also suspicious that maybe those who are managing the TVIX have somehow messed up in some kind of huge failed futures trade/s. Regardless, the old target levels of 25 and 35 are completely to be discarded now.  From a chart perspective, 14 would now be the resistance for any bounce. It sure is one ugly situation.

UVXY - just another way to lose money

UVXY was the hot new thing, and seemed to be replacing the TVIX as the way for non-options players to trade the VIX. However, its just collapsing away like its TVIX cousin. There is nothing good about this, and even though it just recently had a reverse split, it may need another one within 3 months - not least if VIX 12 or less, and if SP' can break above the next level of 1440.

The target for all such derivatives is...0

Even Credit Suisse have on page'1 (I believe) of the prospectus stated that the long term value for TVIX, and other related products is 0. The statistical decay issue is pure math, and no one...bullish or bearish..can deny the math.

The past two days trading of TVIX is as good a reminder as any that these crazy VIX derivative instruments are for short term trading only. - arguably ONLY for day-trading, with no overnight holds.

For the TVIX holders this weekend, getting back to Wednesdays close of 14, looks a real challenge right now. The notion of 20 is probably out of the window, unless we get a severe multi-month down cycle from current levels - and such a decline looks less likely after Fridays action.

Knife Catching Bearish Lunatics

I can't blame a complete novice for making such a mistake, but its been very disturbing to see across many message boards in the last two nights, traders noting their new TVIX buy trades. Scrolling through the various posts, seeing trades at ..13, 12, 11, 10, 9, 8, and now 7...its a quite saddening thing to see. If the market merely melts up just to SP'1435/40, the TVIX will be in the 6s, if not the 5s.

If the bigger monthly 'bullish outlook' is correct, and SP'1550 is hit, that will take VIX to under 10, perhaps as low as 7 by late summer. In which case.. TVIX will be 3, maybe even the equivilent of 1. By then of course, they'll have done another reverse split, so that it can decay again from a higher level.

I certainly have sympathy for the TVIX holders right now, but they did have a good floor of 14, from which to have placed a last 'line in the sand' dead-stop of 13.75/14.00.

Have a good weekend.

Friday, 23 March 2012

CVX - bearish energy sector

Chevron is having all sorts of problems, not least the story of execs being refused an exit from Brazil.

CVX daily, near term

Todaw saw a particularly bearish close, outside of the lower bollinger. All indicators are now bearish, and there is currently no sign of a floor. Near term targets would be the recent low of 102, then 99.

The bears who are looking for spring-doom, will need to see stocks like CVX break below last Novembers levels, in this case..$92. That's almost 15% lower, and would be asking quite a lot considering the VIX is still barely moving upward.

If Oil prices can get back below $100 in the next few weeks, that'd certainly also help keep the downward pressure going. Right now, CVX is one of the weakest dow stocks out there, and is best left alone...much like those CVX execs in south America.

Thursday, 22 March 2012

SHLD - channel fail

Sears fell out of its channel today...

SHLD - daily

SHLD is one of the more bearish charts now. Today was arguably a clear break, and a bearish close. First target would be lower bol at 66, but more likely the 200 day MA at 62. Best case bear target is the gap-fill level of 57/55.

HPQ: one of the weakest dow stocks

The Dow closed 45pts lower today, a fair chunk of that would have been due to HPQ, which had yet another lousy day.

HPQ, daily

The little bear flag is confirmed, and a test of last Octobers low of 22 now seems very likely. A break of 22 would be a real victory for the doomster bears out there. All those calling for a significant wave lower will need to see stocks like HPQ show this level of weakness.

Note the higher vol' today, someone was bailing out of HPQ today. Will there be follow through tomorrow? A further fall seems more likely than an immediate bounce.

Wednesday, 21 March 2012

SHLD - Sears still in the channel..just

Sears was down 4% today, the biggest fall in over a month, but its still holding within the powerful upward channel.

Sears, daily, near term

Arguably, a break below about 71, should open up mid 50s. The MACD is now over 65% reset, so there is the real potential for Sears to stabilise, and benefit from another up cycle move - above what did prove to be a resistance level - the October peak of 82.

It remains a disturbingly long way down to the high 20s, which was hit a mere 12 weeks ago.

NFLX: on my doorstep

For the first time, I've been directly subjected to NFLX. Their first bit of advertising arrived on my doorstep today. NFLX is conducting a massive advertising/awareness campaign across the UK, and I'd guess much of Europe too.

NFLX, 2yr, daily

We have a very clear bull flag, which has been confirmed in the last few days, the MACD cycle is now positive again, and NFLX looks set for a challenge to the 200 day MA at 140/150 within the next few weeks.

I suppose we could label the bounce off the floor as an ABC corrective wave - maxing out around 150..before a move much lower to break the previous low.

Earnings season will be vital for NFLX. Can it start to increase profit margins? If yes, then $200 in the summer is easily viable (we all know the momo traders WANT to love this thing again). If NFLX fails to show good growth prospects..with further concerns over 'can it make any money?', then we're likely to see a steep fall.

Certainly, its one to watch, if only for entertainment purposes.

GDX: the Miners are trying to bounce

After a significant sell off- not least aided by further falls in gold/silver, the miners are trying to bounce.

GDX, daily, near term

We've seen a double down cycle from 58 to 48 in just 3 weeks. GDX is without question oversold in the very near term, so a move back to 52/54 would be entirely valid, even though the overall cycle is still bearish.

Targets will be a move back over the psy' level of $50, and then a close over the 10MA around 51.50.

GDX, weekly

A retrace back to around 54, perhaps even as high as the 10MA of 56 seems very valid - and that would still not negate the overall bearish 'rolling over' action we are seeing.

Tuesday, 20 March 2012

AKAM: on channel support

AKAM, good company, but now on channel support

AKAM, daily

Key levels, 35, and 34.50. Clearly, a break into the 33s could be very indicative that the tech'sector - and other main indexes are starting a down cycle.

Conversely, if Wednesday we see even a moderate but consistant up move, AKAM is exactly the sort of stock that should tell us where the broader market is headed.

AMZN: poised for $200 again

Considering the style and trend of the current market, despite the weak profit margins, and fragility of the western consumer suffering from higher gas prices...AMZN looks set for at least a minor break higher.

AMZN, daily near term

Primary target would be a simple $200.

AMZN, weekly

Currently cycling back up...obvious target would be $200.  maybe even a backtest to the original trend line of $220 by late April/May?

Monday, 19 March 2012

FCX: very bullish near term

One of my favourite stocks, and one of the worlds best miners...

FCX, daily, near term

Looks like good upside to 42/44, from current 39.70.
MACD momentum due to go positive cycle tomorrow.

Certainly bodes strongly for further gains in the main markets.

HPQ - a floor, or a bear flag?

HPQ remains in a real problem....

2 weeks stuck at $24 level, having been in a significant renewed decline post-results.

Impossible to say which way this will break, however...the 10MA is currently level, and momentum cycle is due to break to + cycle early this new week. Might we see a standard gap fill back at the $27 level.

So, $3 upside, with an immediate $2 downside. Not a bad long, with a stop at 24.Although there are far better stocks out there. HPQ just smells too much like RIMM, and we all know how that stock chart looks. Something like AKAM or ADBE would be far more dynamic and arguably offer better underlying corporate growth/vision.

GE: breaking higher

GE, General Electric just had a good week, climbing 6% on Friday alone.

GE, daily, near term

GE is approaching resistance, and it would be kinda surprising if it can climb much higher than 21 in the coming week. There is good support at the recent low in the 18s

GE, weekly - a battered heavy industrial

GE is lagging the main index pretty badly. Were it equal to where the SP' currently is - 1400s, it should be around 26/28.

Most important of all, a break below 14, would suggest massive problems ahead, for not only GE, but the wider market. GE, is certainly one of the key stocks to watch, and the doomsters bears will need to see this one break to 12 - or lower, if the more 'interesting' targets of sp'1200/1100 are to be attained later this year.

Sunday, 18 March 2012

AA: Starting at the beginning we go again. This spin-off, from my primary blog, and I'll start with a very brief post on none other than AA- Alcoa.

AA: daily, near term

A good floor, trending upward, first target will be $11, and then 11.40/60. A break below 9.50 would open up 8.50...and 8.50..would open up a challenge of the recent historic low of $5.

AA, weekly, - something of a mess

The next primary resistance level is 17.50....the 30s and 40s look a long ways away!
*If the main market does get stuck around sp'1430/50 this Spring, then mid 11s look a pretty fair target. The contrary bullish outlook- if good earnings in early April, and market breaks above 1450...then Alcoa to challenge the old resistance of 17/18. There is certainly a massive air pocket from the massive 2008 decline into the high 20s.