Friday 29 November 2013

GDX - a fiercely bearish November

November was another dire month for the precious metals, and naturally...the Gold miners. The miner ETF of GDX saw net monthly declines of a rather severe -11.1%, to settle @ $22.32. The outlook for December looks bearish, and GDX could easily slip to the mid teens in Q1 of 2014.

GDX, monthly

GDX, daily


*despite the daily gain of 2.3%, the broader trend remains very weak.

With precious metals looking weak into December, the outlook for the miners is not at all good.

GDX will probably lose the 20s next month, and really, the only issue is when the 2008 collapse wave lows of the $15s will be tested.

If the 15s fail to hold..then really.. it has to be the floor going to be around $10..or $5 ?

Of those levels, it would arguably be the buying opportunity of a life time.

Wednesday 27 November 2013

FB, TSLA, - vulnerable to further downside

Whilst the main US equity indexes look strong into 2014, Facebook (FB) and Tesla (TSLA) both look particularly vulnerable to declines into end year. FB is offering a clear H/S formation..with the neckline already broken, with TSLA still on track for a hit in the $110/100 zone.

FB, daily

TSLA, daily


As many recognise, Mr Market is kinda tired of at least some of the momo stocks lately.

TSLA has already been smashed significantly lower, whilst FB is still battling to retake the daily 10MA.

Despite the gains today, overall, both look weak into December.

Downside targets remain...

FB, $35, possibly 32
TSLA, 110/100. If a few daily closes <$100..then...70/60 in early 2014.

Tuesday 26 November 2013

AAPL - seeking the $600s

Whilst the main market saw continued minor chop, Apple (AAPL), closed significantly higher, settling +2.7% @ $533 - having peaked at $536.14. Near/mid term trends are bullish, with very clear upside to the 580/600 zone by end year.     

AAPL, daily

AAPL, monthly, 7yr


Suffice to say... AAPL remains bizarrely priced relative to the main market.

The bigger monthly chart should be a real concern to those currently interested..or already holding short AAPL

With the Oct' high fractionally broken above, the next target are the 540s of Jan' 2013..but more importantly, the 580/600 zone.

Certainly..we might fall short of the big $600 this year...but it looks a relatively easy hit for Jan/Feb'2014.

Monday 25 November 2013

FB - H&S formation, downside to $35

Despite better than expected earnings recently, Facebook (FB) has struggled, and the AH high in the $56s now looks a considerable way out of range. Price structure is offering a very clear H/S formation, and with the $45 neckline broken today...downside target is a very obvious $35

FB, daily'2


A mere month ago, the upside target was a 'reasonably' comfortable 'low $60s'.

Yet..Mr Market has decided it is done with the momo stocks for this year.

NFLX, is another good example, reasonable results..yet..sold lower.

So...downside target is a very clear $35..possibly 32...before a ramp across the spring, maybe forming a double top in the 50s by late spring.

Friday 22 November 2013

TVIX, UVXY - relentlessly decaying

With equities continuing their broad climb, market volatility remains low. The 2x bullish VIX instruments of TVIX and UVXY are naturally decaying into dust, having declined 11% this week. The remainder of the year will probably see a further 15/20% of decay.

TVIX, daily

UVXY, daily


*first, an update on the VIX, weekly, which gained 0.6% on the week.

I do not expect VIX to break >20 until Jan/Feb..and even then, I expect that to be a typical 'brief spike' affair.

In terms of the VIX instruments, to me, it makes zero sense to be involved on the bullish side of volatility until early next year. Even then, any equity market decline will be moderate and brief. The VIX will struggle to hold the high teens, never mind anything in the low 20s.

The only decent bullish VIX trade, is arguably not until late spring/early summer 2014..and even then, finding a decent entry - without suffering too much decay...will be tricky.

Frankly, the notion of holding TVIX/UVXY - or even VXX, from now..into early next year, seems utter madness.

Thursday 21 November 2013

RIG - retracing, before the next jump higher

Whilst the main market battled hard to claw into the sp'1790s, Transocean (RIG) saw significant weakness across the day, settling -2.9% @ $52.38. Near term downside to a gap fill in the 50/49 zone, before resuming the breakout, into the 65/70s by late spring 2014.

RIG, daily


After a few weeks of very significant gains, RIG is probably just churning out another retracement.

The obvious downside gap zone of 50/49 looks likely to be hit in the near term, before sig' upside into end year...and across the spring.

Relative to the main market, RIG is highly under-valued.

Wednesday 20 November 2013

GDX - set for the teens

The broader trend for Gold and Silver remains starkly bearish. With further significant declines today, the Gold mining ETF of GDX naturally saw major falls, closing -3.5% @ $22.87. If Gold falls to $1050/950 in the coming months, GDX will likely be another 30% lower, in the mid teens.

GDX, daily

GDX, monthly


It has been my broad assertion for over a year that the metals are going to slide.

Targets: Gold 1050/950..with Silver 12/10.

If that is the case, it is arguably a given that the mining stocks will continue to fall - regardless of the main market, which itself I believe will broadly rally into late spring 2014.

For GDX, a further 25/35% of downside looks very viable across the next few months..certainly by summer 2014..when Gold might have floored in the 1050/950 zone.

The bigger monthly cycle is absolutely clear...primary trend is severely bearish into year end..and probably the early spring.

The only issue is whether GDX can take out the 2008 collapse wave low of $15.48

Tuesday 19 November 2013

UAL - breaking new heights

Whilst the main market saw moderate chop, United Continental (UAL) jumped higher at the open, and held at least some of the gains, settling +3.9% @ $37.79. If UAL can hold the breakout for a few more days, it bodes for much higher levels.

UAL, daily


Suffice to say, the mid/long term trend remains broadly bullish, and UAL is once again attempting to break..and hold the $37s.

If this is achieved...then primary target is the double top of 2007, the $48s. That is possible as soon as late spring long as the main market continues to climb.

Monday 18 November 2013

FB, TSLA, TWTR - momo stocks under pressure

Whilst the main market broke to new highs, the momentum (momo) stocks saw some significant weakness. Facebook (FB),Tesla (TSLA), and Twitter (TWTR) closed with rather severe declines of -6.5%, -10.6% and -6.7% respectively. Near term trend for all three is bearish.

FB, daily

TSLA, daily

TWTR, daily


Suffice to say...some rather big declines in many of the momo stocks today.

FB looks particularly interesting in that it might have completed a classic back test of the old (now broken) channel. Primary downside target would be the low 30s.

*if the broader market continues to remain strong into late spring 2014, no doubt, the momo stocks will be back in favour would seem it is just whether it is matter of a few weeks..or a month or two.

Friday 15 November 2013

TVIX, UVXY - decaying into year end

With equity indexes continuing to battle higher, market volatility continues to remain very low. The 2x bullish VIX instruments of TVIX/UVXY are seeing the relentless problem of decay, and look set to fall lower for another 6-10 weeks.

TVIX, daily

UVXY, daily


*first, a reminder on the VIX, which declined 5.5% across the week.

Suffice to say, there seems absolutely zero reason for anyone to get involved in the VIX (at least from the bullish side) until early next year.

With the VIX set to remain low..the lev' instruments will just decay into year end..perhaps by another 20/30%.

TVIX is now 3 years old...

TVIX has declined somewhat..from the opening issue price (adjusted for all the reverse splits)...urghh

As ever...the leveraged instruments are for short term trading only..if at all.

Thursday 14 November 2013

AMZN, TWTR - loss making momo stocks

With the main market continuing to climb higher, it is no surprise to see both old..and new momentum (momo) stocks join the party. AMZN and TWTR closed significantly higher by 3% and 5% respectively, and the near term outlook remains bullish.

AMZN, daily

TWTR, daily


Suffice to say, at least the market is consistent in some twisted ways. Neither AMZN or TWTR are currently turning a profit, but hey.. since when did that matter in the 'new economy'?

TWTR is still in very early days as a stock of course, but it is so far managing to stabilise after an initial..(and notably brief) break <$40.

I would be somewhat surprised if TWTR can manage to break above $50 by year end, but then...these crazy tech IPO stocks are hard to guess.

*the momo my view are for entertainment viewing only. I leave them well alone! However, they are a good reminder of just how crazy this market remains.

Wednesday 13 November 2013

FB - soon to confirm a giant bull flag?

With the main indexes seeing a typical latter day recovery, Facebook (FB) managed to build significant gains, closing +4.5% @ $48.72. Near term price action/structure is offering a very clear bull flag. If that is the case, FB year end target is the 57/62 zone.

FB, daily


Regardless of the main market, keep in mind that recent earnings were 'reasonable', and if FB can keep up the current growth rate in EPS, it should be trading much higher into early 2014.

it would seem Mr Market has just been a little...antsy with some of the momo stocks lately, even those that surpassed Q3 expectations.

That mood won't last forever, indeed..another day or two of upside, and if FB can put in a daily close in the $ should confirm the broader up trend from the summer lows.

Tuesday 12 November 2013

UAL - breaking a new high

Whilst the main market saw general moderate weakness, the airline stock - United Continental (UAL) broke the recent July high, and saw some significant buying interest. UAL settled +4.2% @ $36.80. The mid term outlook is bullish, primary target is the double top of 2007 in the $47s

UAL, daily

UAL, monthly, 8yr


As WTIC oil prices continue to slide, the airline stocks should be doing increasingly well in the final quarter of 2013. Indeed, Q4 earnings, to be reported in January of 2014 should be rather good indeed.

In terms of price action, today's gain was impressive, but it was not a daily close above the July high. Near term is clearly to the upside though.

UAL remains very representative of the wider airline sector, and the rest of the sector should duly follow upwards.

Monday 11 November 2013

GDX - primed to break the June lows

Whilst the main market continues to battle broadly higher into year end, the mining stocks - along Gold/Silver commodity prices, look vulnerable to much lower levels. The mining ETF of GDX settled -0.1% @ $24.26. The broader trend remains strongly bearish.

GDX, daily

GDX, monthly


Regardless of the price action this week, the miners look very vulnerable to another significant wave lower.

The bigger monthly chart is pretty clear. We have a large multi-month bear flag, and that appears to already have been confirmed this month.

Mining bulls should arguably be waiting for GDX to break the monthly 10MA before getting involved.

I do not expect the June lows to hold for the miners..nor the metals themselves. GDX in the mid teens is certainly viable, before this horrific two year collapse comes to a conclusion.

Friday 8 November 2013

TWTR - near term significant weakness

The Twitter (TWTR) IPO saw a huge gain on its opening day, but the week concluded with TWTR seeing a rather significant decline, settling -7.1% @ $41.69. Regardless of any continuing strength in the main US equity market, TWTR will likely lose the $40s within the next few days.

TWTR, daily (2mth)


*yes, I realise a chart with just two daily candles is a strange thing to post, but still...the two candles merit some attention.

TWTR looks set to lose the $40s early next week, and that should open up a further $10 the lower 30s.

Indeed, the real issue is whether TWTR will fall all the way down to the IPO list price of $26 before year end? I think there is a 70/80% likelihood of that.

*On the flip side, much like FB, once the stock settles down after some weeks/months, the momo chasers will probably pile in, and the stock looks set for much higher levels in 2014.

Video on TWTR from


Thursday 7 November 2013

RIG - surges on good earnings

Whilst the main market saw the first significant weakness in over a month, Transocean (RIG) jumped after earnings greatly exceeded market expectations. RIG closed with very significant gains of  7% @ $52.45 - with an intraday peak of $52.95.. Near term outlook looks very bullish.

RIG, daily


I am extremely impressed with Q3 earnings, and RIG looks set for a good 2014.

see yahoo finance news for RIG earnings.

The underlying balance sheet looks reasonable...

see key stats @ yahoo finance

From a pure chart/price perspective, the jump above $50 was indeed the catalyst for a snap/break reaction, and we're now clearly in the early phase of a very significant move higher.

Targets for 2014..$75..and then $85.

*if the main market sees general gains into late 2015 (as I currently believe)..then RIG is probably a $125/150 stock by that time.

The option calls - $80 strike, Jan'2016..look extremely attractive.

RIG looks in good shape for 2014..and indeed...much further out.

Wednesday 6 November 2013

TSLA - headed considerably lower

Whilst the main US equity indexes closed mixed, TSLA opened sharply lower - despite 'reasonable earnings', with an intraday low of $146.44, and settling -$26 (-14.8%) @ $150.70. Near term trend looks extremely weak, with likely downside to the $110/100 zone..certainly before year end.

TSLA, daily


The TSLA reaction to earnings has been very much like fellow momo stocks - NFLX and FB.

The Q3 earnings were unquestionably 'reasonable'..and I do understand why some TSLA bulls are bemused at today's price collapse.

Yet...the price action in recent days has been rather classic.

A break of the broader channel
A back test of the broken channel.
A break of the initial spike-floor of $153.

Absolute text book example...and I have to think TSLA will continue to go 'by the book'...and fall to the 200 day MA...which will be lurking in the 110/100 zone for the remainder of this year.

I'm certainly not saying that TSLA is in corporate trouble, but the stock is due a major retracement after the huge ramp from the $30s - which was a mere 7 months ago.

A drop to the big $100 psy level would be a very natural retracement.

Tuesday 5 November 2013

FB - battling to hold the 50 day MA

Whilst the main indexes saw some minor price chop, Facebook (FB) battled back from early declines, and closed significantly higher, +3.9% @ $50.10. Near term trend remains weak, but the broader trend is still very much bullish.

FB, daily


Suffice to say, FB is probably just building a large bull flag, in a broader up trend.

There looks to be next to zero chance of FB falling into the 30s..never mind the 20s. where it was stuck for the bulk of this year.

Year end target - assuming the main market can break into the sp'1850/1950 zone, will be the low $60s.

Monday 4 November 2013

UAL - trying to break a new high

United Continental (UAL) closed moderately higher for a sixth consecutive day, +0.9% @ $35.85. Near term trend is unquestionably bullish, but there is obvious resistance at the July high of $36.74.  If Oil prices keep on falling, the airlines should do well across Q4.

UAL, daily


*UAL remains one of my favourite airline stocks to follow, as it broadly represents the entire sector.

A double top...or just an initial fail?

The transports index continues to push strongly higher, now in the 7100s. I'm guessing 7300s is viable in the near term, before the first major chance of the market pulling lower on what will probably be significant end year profit taking.

If that is the case, UAL has a fair chance of breaking above the July'24th high of $36.74. The next obvious level would be the big $40 psy' level.

Considering UAL was in the $27s this past August, that would be a massive 45% rise across just 3-4 months.

It remains an incredibly bullish market, and with lower Oil prices..the airline stocks are certainly in favour right now.

Friday 1 November 2013

DRYS - down wave complete?

Whilst the main US indexes saw slight weakness for the third consecutive day, Dry Ships (DRYS) closed with very strong gains, settling +11.2% @ $3.07. It would appear the near term down cycle is over, and price momentum is now starting to swing back to the upside.

DRYS, daily


Media interest is increasing in DRYS, ahead of earnings early next week.

see Forbes.

DRYS is expected to see a smaller loss, but still...a a loss! In an economy that is supposedly in the fifth year or recovery, the shippers are still having real difficult in turning a profit. Some recovery huh?

BDI, weekly

I would only be concerned if we see a weekly close <1200, which would entirely negate the push into the 2000s, and suggest that it was a failed breakout. As it is, I'm guessing we'll see renewed upside into the early spring, perhaps to the 3500/4000 level.

If that is the case, DRYS has a chance at hitting double digits within 4-6 months, which is of course a very bold call to make.

DRYS have earnings on Monday Nov'4.