Monday 30 September 2013

F - still reflecting the wider market

With the main indexes closing moderately lower for the 7th day out of 8, Ford (F) continued to reflect the main market, closing -0.9% @ $16.90. Near term trend is weak, but there should be strong support in the price cluster zone of 16.50/00.

F, daily


So, another moderate decline for the main market..and indeed.. Ford.

Underlying MACD (blue bar histogram) cycle ticked lower for the 13th day, and is now getting somewhat close to what will surely be a cyclical floor.

Ford should find support in the 16.50/00 zone this week. Only with a break under the mid August lows in the 15.70s..can equity bears have any realistic 'small hope' of a test of the rising 200 day MA - which by late Oct' will be around $15.

Despite short term weakness, broader trend clearly remains to the upside. As some recognise, a break into the 20s for Ford, would signal 'something rather interesting for the US and World equity markets.

Friday 27 September 2013

UAL - dive bombing into the weekend

United Continental (UAL) saw severe falls, after warning of lower than originally expected international revenues, settling -9.3% @ $30.91. The 200 day MA - along with recent price cluster-action, around the $30 threshold will likely be tested early next week.

UAL, daily

UAL ,monthly


UAL has always been a bit of a volatile stock. It is highly susceptible to not only the moves in the main equity market, but especially in regards to WTIC Oil prices, and also currency fluctuations.

Today's fall of 9% is certainly a very major fall, but then...we have had plenty of similar sized falls, as recently as mid August.

Airlines always struggling to turn a profit

It has to be said, underlying balance sheet/profit margins look pretty lousy...

see key stats @ yahoo! finance  

It will indeed be VERY important to UAL - along with all airlines, that WTIC Oil prices remain no higher than $110 in the months ahead.

Another few percent lower (at least)

In terms of price action, UAL looks set to fall further, at least to the $30 threshold, that is a further 3% lower, which seems viable as early as the Monday open.

If UAL can hold $30...and if the main market can start to rally on a 'no shutdown' congressional vote, then UAL should be able to resume the ongoing multi-month rally. Just consider that UAL started the year at $23. Despite periodic severe drops, UAL is still a net 20% higher this year.

Looking ahead

In terms of mid-term upside, a break above the July high..into the $37s, should open up a free ride to the Oct'2007 high of the $48s - see monthly chart, where there was a clear double top of Jan' and Oct' 2007.

Thursday 26 September 2013

GDX - still looking weak

With Gold/Silver commodity prices seeing moderate declines, and a relatively weak equity market, the Gold miners saw rather significant declines. The miner ETF of GDX closed -1.5% @ $25.13. There is very soft support at the $24 level, but that looks unlikely to hold.

GDX, daily


Just a brief update on the Gold miners, which are looking rather weak.

With Gold/Silver commodity prices still weak - despite the Fed continuing QE at $85bn, the miners are in trouble.

In terms of price action, GDX looks set to test..and like break under the early August low in the $24s.

Once that goes, the primary target will be a challenge of the late June low of $22.21.

My mid-term outlook for the precious metals remains for significant lower levels (on the order of Gold in the $900s, and Silver in the very low teens). If that occurs, GDX will surely be <$20..if not in mid teens.

STX - strong gains in a weak market

Despite equity indexes continuing to slip moderately lower, Seagate (STX) saw very strong gains, closing +5% @ $43.88. Next target is the July high of $47.38, which seems very viable within the next month or two. Relative to the main market, STX remains very undervalued.

STX, daily

STX, monthly


Seagate has been one of the ultimate gainers since the collapse wave of 2008/09. From a low of $2.66 in Jan'2009, the stock recently hit a new historic high in the $47s, a gain of almost 2000% in just four years.

Despite the massive increase in usage of solid state drives (lead by Sandisk - SNDK), Seagate remains reasonably profitable, and has a very acceptable balance sheet.

see key stats @ yahoo! finance

Relative to the main market, with a forward PE in the single digits, STX is arguably undervalued by 75-100%.

STX is definitely one to watch, especially if it breaks new highs this autumn.

Tuesday 24 September 2013

FB - relentlessly pushing upward

Despite continued moderate weakness in the broader equity market, Facebook (FB) closed another 2.7% higher @ $48.47 (peaking at a new historic high of $49.66). The mid term trend into year end looks extremely bullish, and the $60s look a viable target.

FB, daily


Since the surprisingly good earnings of late July - when FB was in the $26s, having then exploded to $34, the stock has done incredibly well.

Yes, there are occasional days when the stock will drop significantly, but the falls are very brief, and today again saw significant mainstream interest in the stock.

Year end outlook

A conservative outlook - (now that QE has been confirmed to largely continue into 2014) for the main market is sp'1750/1800, and that should allow FB to reach the mid 50s..if not the low 60s.

The really scary question is...will FB break into the $100s next year?

There is a likely IPO for Twitter, and if true bubble-hysteria does return to the social media stocks..with continued general strength in US equities, FB could be a triple digit stock....which was truly unthinkable a mere 8 weeks ago.

Monday 23 September 2013

AAPL - outperforming the main market

Whilst the main indexes closed moderately lower for a third day, Apple (AAPL) saw very significant gains of $23 (4.9%) into the $490s. Near term momentum is turning back to the bulls, and a daily close in the $500s looks very viable for Tue/Wednesday.

AAPL, daily


AAPL was higher by $30 in Monday pre-market to $498, but with the main indexes weak, the opening gains failed to a significant extent in the early morning. Yet..the afternoon action was one of a recovery, and the closing gain of almost 5% is something to be taken seriously.

From a MACD (blue bar histogram) cycle, AAPL is set to go positive cycle - along with a bullish cross, no later than Wednesday. A daily close in the $500s looks very viable for the Tues/Wednesday close.

If the main market can battle higher - into the sp'1730s, later this week, AAPL will very likely be trading in the 520s.

Bigger picture - a 2013 close in the $600s ?

AAPL, monthly, 7yr

Perhaps far more interesting to consider is the outlook for AAPL. If the main market can climb broadly into year end - sp'1850/1950, then AAPL should (in theory) be back in the 600s. Yes, there are serious issues with very strong competition (not least Samsung), but APPL still has a massive worldwide fan base, and that simply won't disappear overnight.

Naturally, a fair few doomer bears will roll their eyes at the notion of a year end upside target in the $600s, but relative to the main market, AAPL is seriously under-valued.

see key stats @ yahoo! finance.  A forward PE of around 11.5 is 'reasonable' on any basis.

As ever, AAPL is one to watch!

Friday 20 September 2013

GDX - a nasty collapse to end the week

It was one hell of a dynamic week for the Gold miners. A huge 9% gain on Wednesday - after QE was fully maintained, but then very sharp falls across Thursday and Friday. GDX settled lower on Friday, -6.5% @ $25.58, and is now resting on soft support.

GDX, daily

GDX, monthly


Well, its been possibly the most dynamic three days for the Gold miners in quite a few weeks...or months. We've seen a very sharp ramp..only to crash back to Wednesday opening level.

In terms of price support, GDX closed the week right on key support. Any daily closes <$25, and GDX will be extremely likely to re-test the old June low of $22.21.

The bigger monthly chart is similarly starting to look ugly again, with what might be a simple multi-month bear flag. Confirmation would be new lows in the $21s, but that is a very significant 20% lower than current levels

As ever, the miners price action will be largely dependent upon the spot price of Gold/Silver. My mid-term outlook is for Gold in the $900s, and Silver $12/10. If that is the case, the miners are going to remain under severe downside pressure, even if the main equity market remains battling to the upside into spring 2014.

Thursday 19 September 2013

AAPL - battling higher

Whilst the main indexes closed somewhat lower, Apple (AAPL) closed +1.5% in the $471s. Near term trend is moderately bullish, and equity bulls should be seeking a weekly close above the 10MA of $474/75.The $500s look viable in October.

AAPL, daily


Tech' was one of the stronger sectors today, and AAPL was one of the clear leaders. The daily close was pretty bullish, but still, AAPL is stuck under the rather important 10MA.

Without question, all those seeking mid-term gains into the $500s should be desperate to put in a weekly close >475. That certainly is viable tomorrow..if not at least next week.

Despite a lot of negative mainstream opinion on the stock, relative to the main market, AAPL remains very cheap.

Something to consider, how can AMZN trade where it is..whilst making no profit, and AAPL trades with a sub market P/E ?

Crazy times...crazy valuations.

Wednesday 18 September 2013

GDX - extreme gains for the Gold miners

With the Fed not reducing QE, equities soared - along with Gold and Silver commodity prices. Both aspects helped to send the Gold mining stocks to the proverbial moon. GDX closed +8.9% @ $28.24. Near term outlook is bullish, with a further move to the $30 threshold.

GDX, daily

GDX, monthly


A phenomenal day for those long the gold mining stocks, with one of the biggest daily gains that I can recall this year.

Next target looks a relatively easy $30, where there is very strong downside resistance from last Autumn.

A break >$33, will open up a test of the much more important monthly resistance, which at the end of this year will be around $40.

Clearly, even another 35% higher will NOT clarify that the multi-year down move is over.

For those heavy long the miners...that is something to very seriously reflect upon...despite today's powerful gains.

F - awaiting the next break

Whilst the main equity market continues to broadly climb, Ford (F) closed +0.5% @ $17.44. Near term price action remains largely one of consolidation. A break into the $18s would be extremely bullish for Q4, whilst sub 17.30s would offer at least a minor short term pull back.

F, daily


Ford is pretty much a good representation of the wider equity market. The past six trading days are a near perfect example of price consolidation above old resistance.

If the main market does break lower on a 'sell the (FOMC) news' event tomorrow, look for Ford to break into the 16s no later than Thursday. The 50 day MA of $16.84 probably will not hold, and that will offer a full $1 lower into the 16.25/00 zone. Even if the market gets upset tomorrow, the 200 day MA - $14.29, looks an extremely long way down.

A break into the 20s?

Regardless, relative to the main market...not least the 'hysteria' stocks (NFLX, FB, AMZN, etc), Ford looks very fairly valued. As many are starting to tout, a break into the 20s would be an extremely bullish sign, not just for Ford, but for the wider US equity market.

Friday 13 September 2013

TVIX, UVXY - a brutal week for volatility bulls

With equities rallying across the week, the VIX slipped over 10%. The 2x VIX bullish instruments of TVIX and UVXY both saw weekly declines of around 19%. If Mr Market can cope with the FOMC next week, the VIX will remain low for some weeks..perhaps months.

TVIX, daily

UVXY, daily


First an update on the VIX weekly chart...

A very significant drop of around 10% for the VIX this week, which matches the equity indexes that  generally gained around 2%.

*Yours truly was long VIX last Friday from 15.50, and bailed in the low 14s. Considering the equity weekly charts, I'm resigned to further equity gains for some weeks, perhaps months, and in that case..long-VIX is simply no longer a valid trade.

Equity bears had their chance....and failed.

For the TVIX/UVXY holders who did not get stopped out earlier this week, the weekly declines of around 19% are indeed brutal.

A simple reminder of the decay issue...

UVXY, weekly

Hell, UVXY even started its life with a weekly black-fail candle.

As ever...such leveraged instruments are for short term holds only, a week or two at most, arguably days....if not mere 'hours at a time'.

Thursday 12 September 2013

GDX - miners crushed as precious metals slammed

With Gold and Silver commodity prices seeing their biggest drops in a fair while, the mining stocks naturally saw rather severe falls. The Gold miner ETF of GDX closed -5.5% @ $25.31. So far this month, GDX has lost 10%.

GDX, daily

GDX, monthly


Next key support for the miners is $24 - the low from early August.

If we see more than a few daily closes in the 23s (or lower), then a break of the late June lows looks very likely. That in itself would also be a major negative sign for Gold and Silver prices.

On the bigger monthly chart, we have set up a very large multi-month bear flag. If that is the case, the primary target zone for the next wave is the Oct' 2008 low zone of 17/15s.

That of course is a rather extreme 30% lower from current levels, and would likely take at least 3-4 months to hit.

Wednesday 11 September 2013

TVIX, UVXY - another cycle of horror

With equities failing to stop climbing, the VIX has continued to melt lower. The 2x bullish VIX instruments of TVIX and UVXY are being ground into dust, falling another 6% today. In the past seven trading days, both have lost around 25%.

TVIX ,daily

UVXY, daily


First an update on the weekly VIX chart...

It is pathetically lame that the bears 'struggled' just to hit VIX 17s last week. Now we're already back into the 13s, and 12s look likely..whether tomorrow..or early next week.

For the TVIX/UVXY holders, the 'big money' long-stops would surely have already been triggered.

*I myself closed a VIX-long position today, with VIX in the low 14s. Considering the price action in equities, I can no longer see a VIX in the upper teens for some weeks...perhaps months.

If the main equity market does continue battling higher - even if 'just' for 4-6 weeks, then TVIX/UVXY will likely decay a further 15/20%..perhaps even more.

As ever....good trading stops are essential, not least for the leveraged instruments.

Tuesday 10 September 2013

NFLX - accelerating to the upside

With the main equity market climbing for a ninth day, Netflix (NFLX) was part of the party, soaring an impressive 6.4% @ $313. Near term trend has been consistently to the upside since mid August ($260s), and today's move was an extremely bullish signal.

NFLX, daily


NFLX is perhaps becoming the number one Momo stock now, even over-taking Tesla (TSLA).

The bigger monthly/weekly trends are clearly very much to the upside..and today's move solidifies support above the big $300 level.

Where next? You can be sure there will be increased talk of the $500s.

If the main market fails to see any further down waves this autumn, with sp'1800/1900s by year end, then NFLX will probably end 2013 in the 400s.

*I should note, unlike AMZN, at least NFLX is set to make a profit..even if it is a small one. 

see key stats @ yahoo! finance

Monday 9 September 2013

UAL - climbing once again

With the main equity market melting higher, United Continental (UAL) closed with significant gains, +4.4% @ $31.03. With Oil prices cooling down a little, the airline stocks are battling back after recent strong falls.

UAL, daily


Today effectively bust the recent bear flag, and is a very strong breakaway from the 200 day MA.

Next key target are the low $32s, just another 3.5% higher, where the 50 day MA lurks, along with a declining upper bollinger.

Across the last few months, there is strong price resistance in the 32/33s.

Arguably, the only decent UAL long, is on a break into the $34s. Similarly, for the bears, a safer short-side play would be chasing it lower in the $28s.

The immediate problem remains the US/Syria issue. If Oil prices spike on any overnight/weekend attack, the airline stocks are going to be severely impacted by rising oil prices - even if only temporary.

What is clear though, in the immediate term..trend is indeed up!

Friday 6 September 2013

TVIX, UVXY - big bull flags

With the market seeing significant weakness in the closing hour of the week, the VIX flipped back to positive. The 2x bullish VIX instruments of TVIX and UVXY both closed 1.3% higher. Price formation looks to be a rather clear..and large bull flag. Significant upside appears likely next week.

TVIX, daily

UVXY, daily


First, a reminder on the VIX weekly chart...

So, across the week, the VIX declined by around 7%. Yet the Friday equity/VIX price action looked particularly in favour of the equity bears.

If today was a key reversal day, then the next 5-7 trading days should effectively be broadly downward, with sp'1580/70s.

That should equate to VIX in the low 20s.

In terms of TVIX/UVXY, that should probably offer a good 25/30% higher.

As ever though, when the indexes floor this September...and the VIX tops will be imperative to exit the leveraged instruments..not least for issues of decay..never mind the trend!

Thursday 5 September 2013

AAPL - set for a golden cross

Whilst the main equity market continues to battle higher, Apple (AAPL) closed lower, settling -0.7% @ $495. Despite the recent moderate decline, AAPL is set for an important 'golden cross', where the 50 day MA breaks back over the 200 MA.

AAPL, daily


The last few weeks of price action could easily be setting up a rather large bull flag.

For those seeking major index gains across Sept..and into October, AAPL is now one of the most bullish stocks out there.

Not only is there huge support in the $450s - where the 50..and 200 MA are lurking, but AAPL is going to get a golden cross. On any basis, near term outlook is bullish.

Wednesday 4 September 2013

F - rising on good sales data

With the main market building gains across the day, Ford (F) excelled on impressive broader vehicle sales data. Ford closed +3.5% @ $16.91. Near term trend is bullish, but there will be strong resistance in the low $17s.

F, daily


Ford continues to be one of the stronger stocks out there, although with the main market looking somewhat of a problem into Oct/Nov, Ford might need to merely consolidate for a few months.

There is strong possibility of a double top in the next day or two. If Ford can't break the mid $17s..then first downside will be 16.25/00.

If the main market does rollover into the autumn, then the bigger target for Ford will be the mid $14s, where the 200 day MA will be lurking.

Tuesday 3 September 2013

UAL - airlines struggling

The price action in United Continental (UAL) largely reflected the action in the indexes, closing with a classic black-fail candle, settling +0.7% @ $28.65. Near term trend looks very weak, and today marked the fifth daily close under the 200 day MA.

UAL, daily


There are two key issues the airlines are facing in the near term.

-Oil prices are well over $100...and could easily spike to the 120s on an actual attack on Syria.
-US growth remains weak.

From a pure price perspective, with yet another close under the 200 day MA, UAL looks set to test the Jan'2013 lows in the $23s - that is a clear 15% lower than current levels.