Monday, 24 July 2017

GE - ironically, few seem to care

Whilst the main market saw moderate weakness, there was further significant weakness in General Electric, which settled -1.8% at $25.43. As things are, GE is set for a fifth consecutive net monthly decline, the most bearish run since Sept'2011.


GE daily



GE monthly



Summary

Many things in this twisted casino bemuse me, not least how sometimes the mainstream will just ignore something rather obvious. In many cases it just seems to be a simple case of outright denial.

GE started the year on a weak note, settling January at $29.22. February and March saw moderate chop. There was a failed rally in April, with the month ending badly at $28.75. May saw sig' downside, with another failed rally to $29.22 in June - as the CEO - Immelt, announced he was leaving.

The June close of $27.01 confirmed the provisional bearish break of trend seen in May. Keep in mind, this trend extends back to the March 2009 low. It is a monstrously important trend, and yet... for some reason, most either don't notice... or at the very least, simply don't care.


Is GE an early warning of trouble for the broader US market?

Its certainly something that merits serious consideration, and again, its a wonder why hardly anyone out there seems to care. Next big support isn't until the low $22s, and that is a long way below current levels. Further, it'd represent a decline of around 30% from the July 2016 high of $31.97.

Outlook: near/mid term bearish.

Friday, 21 July 2017

GDX - a second weekly gain

With the precious metals climbing for a second week, the related miners followed. The ETF of GDX ended the week on a moderately positive note, settling +0.4% at $22.41, which made for a very significant net weekly gain of 2.8%. Near term outlook is shaky, as any rebound in the USD will put major renewed downward pressure on the metals and miners.

GDX daily



GDX weekly



Summary

First, lets be clear, a couple of net weekly gains does not negate the break of core rising trend. Indeed, price action in GDX remains just under old support - currently around $22.60.

Frankly, having seen sustained action under core support, the mid term outlook has to be bearish, unless GDX is trading above the June high of $23.86.

Gold itself is holding core trend - that stretches back to Dec'2015, but Silver remains seriously broken.

The one indirect bullish signal for gold/silver, and the related miners, is copper, which has recently seen a series of daily closes above the key $2.70 threshold.
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Keep in mind, the USD has given the metals an extra boost this year, having cooled from the DXY 103s to the 93s. The precious metals will be under major renewed downward pressure on any USD bounce.

Thursday, 20 July 2017

F - a tenth consecutive daily gain

Whilst the main market settled moderately mixed, Ford (F) settled higher by 2 cents (0.2%) to $11.70. It was just a minor gain, but a very notable tenth consecutive net daily gain - the best run since early 2012. Earnings are due July 26th in pre-market.


F daily



F monthly



Summary

Suffice to add.. the past ten days have been rather impressive for Ford, and especially the past four days, all settling above the key 200dma.

Near term cooling seems probable, not least if the main market cools by around 1.5% to sp'2435. 

Mid term trend has been very bearish since the July 2014 high of $15.36. Things will turn bullish with price action >12.25 or so. From there... a run to the $15s, which is absolutely viable before year end.

Earnings are due next Wednesday morning... and that'll be something to watch!

Wednesday, 19 July 2017

IBM - big blue is big red

Whilst the main market broke another set of new index historic highs, there was sig' weakness in International Business Machines (IBM), which settled -4.2% at $147.53. The Oct'2016 low of $143.91 is a prime target before end month. Mid term outlook is bearish, whilst long term.. still bullish.


IBM daily



IBM monthly



Summary

Suffice to say... IBM is a company that I realise most of you care little for. Many of you have probably never directly traded it, and I can understand that. Other than earnings, the stock receives very little attention.. whether from traders, or the media hacks of clown finance TV.

With a forward PE in the 11s, a dividend yield of around 4.0%, I've no doubt the 'big/serious' money is picking up IBM at these levels. I can't blame them. Its slow and boring, but the valuation is unquestionably attractive.

Bullish long term... especially if the $143s hold into early August.

Tuesday, 18 July 2017

NFLX - bullish stranger stocks

Whilst the main market saw a day of moderate swings, there was powerful upside in Netflix (NFLX), which settled +13.5% at $183.60. Near term outlook offers a little chop - not least if sp'2435/25, but broadly, the $200s are clearly coming.


NFLX daily



NFLX monthly



Summary

Headline EPS did actually miss by 1 cent, but the market didn't care, as subscription growth was rather superb.

If you 'generously' extrapolate to an annual EPS of around $1.50, that still makes for a stock with a PE well >100. On any basis.. that is crazy, but then its a crazy market, where capital is desperate to find growth/yield.

With a new historic high today, many recognise the stock is headed far... far higher.

RBC capital are just one of many who are seeking >$200


It can be expected that we'll see further upgrades for 2018/19 to the 250/300 zone before year end.

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Yours truly has ZERO interest in chasing such a 'FANG' stock - on a pure valuation basis. That sure doesn't mean I don't see great value in the company, and the original content is some of the best ever produced...



Season two of Stranger Things is one 'entertainment' reason to stay alive until at least Halloween 2017.

Monday, 17 July 2017

APRN - the CEO remains on radio silent

Whilst the main market saw a day of minor chop, there was renewed powerful downside in Blue Apron (APRN), which settled -10.5% at $6.59. Near term outlook offers the $5s, as Mr Market has a profound contempt for this newly listed stock.


APRN, daily



Summary

There are many dubious issues surrounding this company, not least the issue of voting rights for shares...

Enjoy this little flashback story, when most thought the company could find interested buyers around $15 a share...

https://finance.yahoo.com/news/blue-apron-raise-587m-ipo-064042697.html
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So... lets be clear, 30 million class A' shares (1 vote each)...  sold for $10....  $300 million, yet...another 157 million shares, but those have 10 votes each! Talk about crony capitalism!
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As for the CEO...

see: https://twitter.com/mattsalz

The CEO remains on radio silent mode. Is that a requirement of the recent IPO ? I've heard nothing that suggest he has to remain mute on what is an absolutely disastrous IPO.


My questions to Salzberg...

1. Where are you hiding?
2. How could you possibly justify selling shares with grossly unbalanced voting rights?
3. How long until you ask the capital markets for more money, 3mths, 4, 5, or 6?

4. Do you ever aspire to make a profit, or do you follow the TSLA, NFLX, and AMZN business model?
5. How about selling Blue Apron to AMZN, I'm sure they could merge it quickly within their new subsidiary of Whole Foods?

6. Are you worried about any lawsuits from angry retail amateur 'investors' ?
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Seriously, APRN has been one hell of a stock to follow, and its only seen 12 trading days. The psy' level of $5.00 would make for a viable short term floor before end month... but even then.. what kind of maniac would get involved in such a stock?

To be clear, yours truly likes the product/service, but its a loss making company, no dividends, and will surely need new capital before year end. Outlook has to be bearish.

Friday, 14 July 2017

GDX - sustainably under old core trend

With the precious metals of Gold and Silver seeing the first net weekly gains since late May, the related mining stocks followed. The ETF of GDX ended the week on a positive note, +1.5% at $21.83, which made for a net weekly gain of 2.9%. Mid term outlook is bearish.


GDX daily



GDX weekly



Summary

*note the black-fail daily candle, which doesn't bode bullish for Monday. Further, short term price structure is a viable baby bear flag.
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Suffice to add, its been a messy few months for the gold miners. May saw a fractional break of core support - that stretches back to the multi-year low of Jan'2016. However, the miners rallied into early June, but then saw another wave lower.

Last week was the most bearish close since Jan'2016. This week saw a bounce, but its arguably just back testing broken trend/support... within a price gap zone.

Outlook has to be bearish unless GDX back >$23,  the $24s to be decisive. 

Thursday, 13 July 2017

AMD - short term double top

Whilst the main market saw a day of minor chop, there was significant weakness within semi-conductor stocks, with Advanced Micro Devices (AMD) settling lower by a very significant -5.3% at $13.53. Near term outlook offers further weakness to rising trend, currently in the low $12s.. where the 50dma is lurking.


AMD, daily



AMD, monthly



Summary

AMD has got stuck again in the mid $14s, and we have something of a double top. A bearish MACD cross on the daily cycle will be viable within 1-2 days.

Seen on the bigger monthly cycle, the rising volume makes it clear how greatly recognised the company/stock has become within the mainstream. Price structure since the Feb' high is arguably a bull flag, which would be suggestive of mid term upside to at least $20... if not $25/30.

I continue to be suspicous that AAPL might place a bid for AMD later this year. At some point CEO - Tim Cook, will be under pressure to buy something, almost anything, to divert attention from the fact that the company is currently out of ideas.

To be clear, I am mid term bullish the stock, even though AMD has yet to prove itself with earnings. There are arguably better alternatives in MU, QCOM, NVDA, or INTC.

Wednesday, 12 July 2017

FCX - broadly stuck with copper

Whilst the main market settled broadly higher, there was notable weakness in Freeport McMoRan (FCX) which settled -2.5% at $12.27. With Copper stuck within the tight range of $2.70/45, FCX remains stuck under sig' resistance of the low $13s.


FCX, daily



FCX, monthly



Summary

January saw a multi-year high of $17.06, but since then, its been a tough time for FCX, and to varying extents, other copper miners. June saw a low of $11.05 - back when copper traded to $2.52.

Near term best guess?  Leaning weak, not least as copper is struggling to break and hold >$2.70.

The cautious will leave FCX alone until a clear breakout >$13.25, and/or with Copper seeing a weekly/monthly close >$2.70.


Bonus chart: copper, weekly


We have a series of marginaly higher lows from mid May. Underlying MACD (blue bar histogram) is holding exactly at the key zero threshold. Trend is clearly leaning upward.

Tuesday, 11 July 2017

SNAP - below the IPO floor

Whilst the main market saw a day of moderate swings, there was very powerful downside in SNAP, which settled lower by -8.7% at $15.51. The break below the IPO issue price of $17.00 is a very significant technical break, confirming a recent bear flag. Near/mid term outlook is bearish.


SNAP, daily



Summary

Suffice to add, the pressure has been building for a few weeks, and today saw the decisive break below the $17.00 price.

Today can be seen as merely day'1 of a down wave that will probably see SNAP in the $14/13s within days.

A grander issue is whether we'll see single digits. Clearly, if next earnings (date unknown) even fractionally miss, the stock is going sub $10.00.

Outlook.... lousy.

Monday, 10 July 2017

M - broadly... horrific

Whilst the main market saw a day of moderate chop, there was significant weakness in Macy's (M), which settled -7.0% at $21.08. Near/mid term outlook remains bearish, as the stock has lost a horrific -68.8%, since the historic high of $67.67 in July 2015.


M, daily



M, monthly (linear scale)



Summary

I usually don't get time to highlight this stock, but the fact its broken another multi-year low merits it.

The 'box' retail remain within what is an outright collapse wave since summer 2015. Just consider that whilst the sp'500 climbed 13.7% since the May 2015 high, Macy's has declined by -68.8% from July 2015. That is unquestionably disastrous!

Macy's stock valuation is certainly on the low side, with a forward PE of around 7. As ever though, being retail, margins are tight, currently net profit margin is just 2.3%, and thats with the economy in a growth phases. What happens when the next recession hits?

A grander issue prospective 'bargain buyers' need to ask themselves... 'what is there really to look forward to?'. After all, AMZN, BABA, and others are continuing to push hard, cutting into Macy's customer base.

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Key stats: https://finance.yahoo.com/quote/M/key-statistics?p=M
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Yours truly has never been to a branch of Macy's... and probably never will.

Friday, 7 July 2017

GDX - a very bearish weekly close

With the precious metals leaning significantly weak, the related gold miners are continuing to be dragged lower. The ETF of GDX settled the day on a bearish note  -1.3% at $21.21, which made for a net weekly decline of -3.9%. The weekly close under core rising trend/support is very bearish indeed.


GDX, daily



GDX weekly



Summary

Frankly... this is one seriously bearish weekly close, arguably, the worse since the key low in Jan'2016.

I recognise some might still call price structure - from early February, a large bull flag, but GDX is decisively under core rising trend that stretches back 1.5yrs. This can't be lightly dismissed.

Near term outlook: bearish. First soft target is the Dec'2016 low of $18.58. If that is broken under, then a full retrace to the Jan'2015 low of $12.36 will be on the menu.

Keep in mind, Silver has already broken below core rising trend, and that sure doesn't bode well for Gold... or the related mining stocks.
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*see my related post for Gold and Silver!

Thursday, 6 July 2017

GE - its a problem

Whilst the main market settled broadly lower, there was very significant downside in General Electric (GE), which settled -3.8% at $26.31. The sustained price action under the $27.00 threshold is a serious problem for the industrial bulls, but arguably... also for the main equity market.


GE, daily



GE, monthly



Summary

GE saw a very mixed June, rallying on news that CEO Immelt was planning to step down, but those gains quickly faded, and the stock closed net lower for a fourth consecutive month.

Today's price action is merely cementing the serious technical problem that should be clear via the giant monthly chart. We have a sustained break under rising trend/support that began in March 2009. Such a break can't be dismissed lightly, even as the main market remains close to historic highs.


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Meanwhile...



... the downgrade by JPM to $22 sure didn't help today.
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I will end by noting, near term is clearly bearish, but ongoing price action is especially weighed down by the long term bearish break.

To many, GE is a boring stock... but even if you never trade it, GE is important to track, and consider in any assessment of the broader equity market.

Wednesday, 5 July 2017

TSLA - decisive break of trend

Tesla (TSLA) saw a decisive break of rising trend/support - that stretches back to Dec'2nd 2016, settling -7.2% at $327.35. With the infamous squid - Goldman Sachs, downgrading the stock from $190 to $180, the stock is set to remain under downward pressure.


TSLA, daily



TSLA, monthly



Summary

Technically, today's break is a decisive one.

Its somewhat ironic to see GS only downgrade Tesla by $10, but the renewed sell rating of $180 has certainly spooked some within the mainstream.

Daily: a clear break of the upward trend that stretches back to early Dec'2016. Next soft support is the psy' level of $300, and then the $280/270 zone. The 200dma is currently at $258, and should be near $270 by late July/early August.

Monthly: a rollover is underway, note the key 10MA, currently at $272. Considering the underlying strength within the broader equity market, Tesla should be able to find a floor around the 280/270s this summer.
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I'll close on this twisted, but valid thought....

If you were a Tesla stockholder, it is a sad FACT that if your company sold ZERO vehicles, its balance sheet and financial longevity would be in a far better state.

Selling every vehicle at a loss is not sustainable for the mid/long term. The only reason Tesla has got away with it for some years is because the CEO Musk has been given 'a pass' on just about everything. What happens when the next recession hits, and the capital markets refuse to throw another billion dollars to cover increasing losses?

To be clear, I like the product, the CEO is inspirational (especially for SpaceX and his new Tunnel boring venture), but selling vehicles at a perpetual loss is just plain crazy.

Yours truly remains (disturbingly) in the same bearish bed as GS.