Tuesday 31 October 2017

GE - an eighth month lower

General Electric (GE) settled lower for a SEVENTH consecutive day, -1.2% at $20.16, which made for a net monthly decline of -16.6%. The stock has declined for EIGHT consecutive months, and 9 of the past 10. The Oct' close <$22.00 has opened the door to the $13s in 2018.

GE monthly

GE daily


Since the break <$27.00 in May, I have been touting the $22s. This month saw major support of $22.00 hit, and almost immediately failed to hold. Next soft psy' level support of $20.00 has already come close to being tested, with an Oct'31st intraday low of $20.05.

By definition, the Oct' close under $22.00 now offers the $13s, which is a key price threshold across the last 20 years.

Keep in mind the Nov'13th investor meeting. If the CEO/Chairman Flannery fails to inspire confidence, it will strongly bode that the $13s are indeed coming in 2018.

Monday 30 October 2017

AMD, NVDA - a stark contrast

Whilst the main market leaned broadly weak, there was a stark disparity between two of the key semi-conductor stocks. Advanced Micro Devices (AMD) and Nvidia (NVDA) settled -8.0% and +1.0% respectively. The two companies are similar... except in the key aspect of profitability.

AMD daily

NVDA daily


Suffice to add, profits do matter.

Recent earnings in AMD were simply... mediocre.

NVDA has earnings Nov'9th, and its safe to say, even if they miss, they'll still be vastly superior to AMD.


AMD: last week saw a key break of support. There is little but empty air to the $10.00 threshold.

NVDA: today saw a new historic high of $206.09, as the m/t trend from early 2016 remains hyper bullish.

For the record, I happen to favour Micron Tech' (MU) and Intel (INTC) above AMD and NVDA.

Friday 27 October 2017

GDX - a second week lower

With precious metals on the slide, the related miners followed. The gold miner ETF of GDX ended the week on a positive note, +0.6% at $22.57, but that still resulted in a second consecutive net weekly decline of -2.8%. Near term outlook is bearish.

GDX daily

GDX weekly


Suffice to add, weaker metals - partly due to a stronger USD, have naturally seen the miners remain under pressure.

Things would turn very bearish if the July low of $20.99 is taken out. However, that still seems unlikely, not least via the indirect bullish signal of copper.

Thursday 26 October 2017

GILD - naturally cooling

Gilead Sciences (GILD) continues to be under s/t downward pressure, settling -2.5% at $77.88. After a run from the $62s to the $85s, some cooling to the 72/71s would be very natural indeed. M/T bullish >90, with a grander target of $110. L/T >150.

GILD daily

GILD monthly


Suffice to add... GILD is my favourite health/bio stock.

Based on latest earnings and a stock price in AH of the $75s, forward price earnings multiple: 8/7s, with a yield of around 2.8%. On any basis, that is a ludicrously low valuation.

Seen on a giant multi-year chart, price structure across the last few months is a bull flag. It will be provisionally confirmed with a break >85.73. Basic target is the $90 threshold, and then $110, which seems viable by mid 2018.

To be clear, I am s/t bearish the stock, but m/t hyper bullish.

Wednesday 25 October 2017

AMD - yet to prove itself

With the main market broadly weak, Advanced Micro Devices (AMD) was under pressure, not helped by mediocre earnings/guidance. The stock was whacked lower, settling lower by a powerful -13.5% at $12.33. With a break of multiple aspects of support, the door is open to a major washout around the $10.00 threshold.  

AMD, daily

AMD, monthly


First, Q3 earnings: http://ir.amd.com/phoenix.zhtml?c=74093&p=irol-newsArticle&ID=2310889

Advanced Micro Devices (AMD) has always been a stock that has been one of hope, never having been sustainably/significantly profitable.

Q3 earnings were certainly continuing the improvement seen in recent quarters. However, headline EPS of 10 cents is just... mediocre. If you extrapolate 40 cents to the year, at a stock price of $12, that gives a FPE of 30.

I'll merely add, there are arguably better alternatives: MU, INTC, NVDA

Tuesday 24 October 2017

CAT - powerful underlying strength

Caterpillar (CAT) jumped higher on good earnings and guidance, with a new historic high of $140.44, and settling +5.0% at $138.24. Near term outlook threatens some cooling, but broadly, the $200s are clearly due in 2018.

CAT daily

CAT monthly


At the start of the year I noted that a break >$100 would offer a straight run to 120/25 by year end. CAT duly broke $100 in late April, and has broadly climbed, breaking >120 in mid September.

Considering we saw the $140s today, its not a stretch to see $150 by year end.

Today's settling black-fail candle does threaten short-term bullish exhaustion, but broadly, $200 is a valid target for the latter half of 2018. Implications for the Dow, and rest of the market.

Monday 23 October 2017

GE - renewed weakness

General Electric (GE) saw a powerful bullish reversal on Friday, yet that has been largely negated today, with the stock settling -6.7% at $22.24. The Friday pre-market spike low of $21.48 remains very important. A monthly close under the multi-decade key threshold of $22.00 is unlikely.

GE daily

GE monthly.


There is little to add from Friday.

Clearly, many are now awaiting the investor meeting of Nov'13th, for some clarity about what the new CEO's plan is.

The main market is threatening a s/t top from sp'2578. If the main market is indeed finally in the very early phase of a 4% cooling wave into early November, then GE will remain under sig' pressure.

The $22.00 threshold is very important when seen on a multi-decade chart. If the stock settles Oct' or Nov' under <$22.00, and if the CEO's plan is weak, then next big target are the $13s by mid 2018... even if the main market remains hyper strong to sp'3K next spring.

To be clear, s/t bearish, but I'm leaning m/t bullish, with no monthly closes <$22.00.

Friday 20 October 2017

GE - the important $22.00 threshold

General Electric (GE) posted Q3 results on Friday, and they weren't pretty. The stock duly imploded in pre-market to $21.48, saw a cash market low of $22.10, and settled the day +1.1% at $23.83. Now its a case of whether the stock closes above or below the key $22.00 threshold this Halloween. Its rather important!

GE daily

GE monthly


*First, a special chart note. For some reason, stockcharts is deleting the pre-market data from the closing charts. Thus the pre-market low of $21.48 no longer appears, but the stock was notably trading in the $21s for more than just a few minutes!

see: https://www.ge.com/investor-relations/overview

see: https://www.ge.com/investor-relations/sites/default/files/ge_webcast_pressrelease_10202017.pdf

GE has been struggling since the July 2016 high of $31.66. Note the monthly candle was spiky, and settled fractionally red, indicative of a key multi-month/year top. Despite today's bullish whipsaw, the close of $23.83 makes for a 24.7% decline across 16 months.

Today's settling daily candle is a hyper bullish engulfing candle. Those are to be taken seriously, and if GE can settle October >$22.00, it will give credence to today's massive upward swing.

Q. Do I have faith in the new CEO Flannery?

I see a company that is struggling, but GE still decided to spend another $3.7bn in buying back shares in Q3 2017. Seriously, what the hell kind of policy is that? I'm broadly against such buy backs, but for a company that is struggling to continue this, its just plain crazy.

I will start to have some faith in Flannery if he cuts/halts the buy back. I'd rather see him do that, than cut the dividend.

Eyes on the Halloween settlement.

The Tuesday Oct'31st settlement for GE will be VERY important. Will the stock manage a monthly close >$22.00?

To be clear, from a pure technical perspective, if GE settles Oct', Nov', or beyond, under $22.00, then it offers first soft psy level of $20.00, but a grander target of $13.00. 

Considering EPS for 2017 is now estimated to be $1.05-1.10, the $13s are a viable threat by mid 2018, even within an equity market that is broadly super strong.

The Nov'13th meeting

GE have an investor meeting scheduled for Monday Nov'13th, and that will merit serious attention. The market will want to see a CEO with a solid plan for the mid term. If that includes a dividend cut, the market would likely not smash the stock, so long as it decides Flannery's plan as credible enough to turn the company around. 

Thursday 19 October 2017

UAL - crashing through support

Whilst the main market saw a day of moderate swings, there was severe downside in United Continental (UAL) which settled -12.1% at $59.78. With a break of rising support from the Sept' low, s/t outlook is bearish. Despite concerns of a price war, m/t outlook is bullish.

UAL daily

UAL monthly


The day began....

.... with the CEO of UAL on CNBC. In pre-market, the stock was lower by around -2%, which (despite the main market) was a surprise, as earnings were unquestionably good.

Yet... with a moderately weak main market, the stock started to spiral. With talk of a 'price war', technical support was broken, and that saw a major washout occur. The daily candle is very bearish, and bodes for a test of the recent low in the $57s.

To be clear... earnings were good. With annual EPS of almost $9, this makes for a forward PE in the 7s. On any basis, that is crazy low.. a third of the typical main market valuation.

Unless you really believe there is set to be some kind of mid term price war between the airlines, the mid term outlook has to be bullish. The grander target for 2018 would be the giant psy' level of $100. Right now, that is a massive 67% to the upside.

yours... prefers travel via train.

Wednesday 18 October 2017

CREE - crazy unjustified spike

Q3 earnings for CREE were lousy, with EPS of -20cents. Mr Market has somehow managed to twist that into a hyper spike, with the stock settling +16.4% at $34.16. Next big resistance are the $38s. Mid term outlook is very bearish, as the company is still unable to generate any profits.

CREE daily

CREE monthly (linear scale)


First, see: http://investor.cree.com/


There is frankly, very little good to read in there.

The new CEO is touting a focus on Power and the RF side of the business, and away from lighting. So, at least Cree is recognising that there is very little money to be made within the lighting business. That is progress... of a sort.

The company is clearly still struggling, within an economy that is in growth mode. What happens to CREE when the next recession hits, whether that is 2018, 19, or whenever?


Today's hyper spike is largely technical, and a good example of just how crazy things can get when the shorts get squeezed. I call it a 'short-stop cascade', where the higher the stock trades, the shorts have to cover at ever higher prices, which triggers more short-stops. Today's instance was a particular fierce feedback loop.

On any basis, earnings were lousy, and today's price action is unsustainable in the mid term. I will note that 'technically', the next resistance isn't until the $38s, so its possible we see those, before the 'fundamental bears' start to grind the stock back into the $20s.

Yours... bullish LED lighting, but bearish anyone who tries to make money from it. There is little to no money to be made in domestic or industrial lighting!

Tuesday 17 October 2017

NFLX - earnings were fine

Netflix (NFLX) earnings for Q3 were unquestionably fine. However, it was a mixed day for the stock, breaking a new historic high of $204.38, but settling -1.6% at $199.48. Near term outlook is bearish, but with higher subscriber numbers, who are set to pay more, the mid term outlook is very bullish indeed.

NFLX daily

NFLX monthly


*I shall refrain from highlighting a wide array of data, which will have been covered across a thousand other sites.

Q3 EPS was 29cents - vs 12cents a year ago.

On a forward basis, (round up) to $1.20yr, with a current stock price of $199.48, that gives a F' PE of 166. On any basis, that is ludicrously high.

If you are extremely generous, and assume Netflix could reach 50 cents per quarter within a year - $2.00yr, that gives a F' PE of the 99s. That is still double what Nvidia is priced at, and more than 4x the main market.

To be clear, I like the company, which is creating some of the best original content the industry has ever produced. The current valuation is crazy, but as the US/world economy is growing, the company has better  pricing power, and is now confidently periodically raising prices. How long until the typical monthly fee will be $15 a month? Two years? Three? It certainly won't be more than five.

There is a sideline issue in that Disney will eventually want all of its content - especially the Marvel shows, on its own streaming service. However, this is still a few years away, and for the moment, the market doesn't much care.

Bullish Stranger Things, just in time for Halloween.

Monday 16 October 2017

PSX - short term weak

Whilst the main market continued to lean fractionally higher, there was significant weakness in Phillips 66 (PSX), which settled -3.8% at $90.87. With a decisive break of rising trend, s/t outlook is bearish. However, more broadly, the stock looks headed for the giant psy' level of $100.

PSX daily

PSX monthly


Suffice to add, s/t weak, but m/t, this stock has already achieved a key breakout, as especially seen on the bigger monthly chart.

F' PE: 15s, yield 3.1%. Certainly not super cheap, but neither is it expensive.

Keep in mind the fact that WTIC has ended the bearish series of lower highs and lower lows. A move to the 54/55s looks viable before year end, and that could only help re-inspire the stock back upward.

M/T bullish to $100, and from there... 125/30 by mid 2018.. which isn't that bold.

Friday 13 October 2017

GDX - miners leaning upward

The gold miners saw a week of mixed chop, with the ETF of GDX settling the week on a moderately positive note, +0.5% at $23.84, which made for a net weekly gain of 1.1%. Near term outlook offers another wave lower, but a mid term breakout above the Feb' high appears extremely probable.

GDX weekly

GDX daily


Suffice to add, the settling daily candle was of the 'black-fail' type, and cyclically, GDX looks vulnerable in the very short term.

Mid term outlook is rather promising though, as gold and silver - lead by copper, are all broadly clawing upward.

The gold miners are notably lagging relative to Gold, which is close to the summer 2016 highs, whilst the miners are massively below equivalent levels.

Key thresholds: Gold $1400, Silver $22s, Copper $3.00 (achieved).

Thursday 12 October 2017

BAC - leaning weak into earnings

Whilst the main market only closed fractionally lower, there was significant weakness in Bank of America (BAC), which settled lower by -1.5% to $25.45. Earnings (due Friday morning) will likely be fine, but the stock looks near term vulnerable to the low $24s.

BAC, daily

BAC, monthly


Suffice to add, s/t bearish to the $24s, but mid term... I'm effectively hyper bullish. First big target is the psy' level of $30, and then the $33s. If you believe the US/world economy will tick along for another 2-3 years, then BAC could be seen to eventually challenge the 2007 historic high of $45.15.

As an aside, today's settling bearish engulfing candle in Citigroup (C) was rather interesting.

First soft support is the $70 threshold, then 67/66, with the 200dma in the $63s.

Of the financials, I favour BAC and JPM, not that I'd argue C, MS, or GS aren't 'okay'.

Wednesday 11 October 2017

GE - just another down day

Whilst the main market saw a day of minor chop, General Electric (GE) settled lower for a fourth consecutive day, -1.2% at $23.07, the lowest close since Sept'2015. Near term outlook is bearish to the $22.00 threshold. A monthly close <22 looks unlikely, after what is arguably a retrace/consolidation of hyper gains from 2009-16.

GE daily

GE monthly


Suffice to add... GE has been a fascinating stock to follow this year, having cooled from a Jan' high of $31.01 to today's low of $22.90.

GE is currently net lower for the 9th month of 10, having only seen a minor gain in February.

S/t outlook is bearish, by another 4-5% to around the $22.00 threshold, which has been important across the past few decades.

F' PE 14s, yield 4.1%... certainly 'reasonable', relative to a great many other things.

*JPM downgraded the stock with a target of $20.00. That target is clearly possible by year end, but I'm guessing no, on the primary assumption there will be no bearish monthly index closes (sp<2420).

Tuesday 10 October 2017

DIS - this is not going to go...

Short term price action in Disney (DIS) remains choppy, with the stock settling the day up 1 cent to $99.58. Near term outlook is bearish (along with the main market), to the $97/96s. An eventual bullish breakout seems a given, for a company that owns the cash making franchises of Star Wars and Marvel.

DIS daily

DIS monthly


Disney stock saw a hyper run from $25.73 in Oct'2011 (when sp'1074), to $118.62 in early Aug'2015... just before the market imploded. Since then, its been broadly choppy, finding support within the 88-84s. The Sept' low of $96.20 is still a little vulnerable, but mid term outlook has to be bullish.

Arguably, price action since summer 2015 to the present could be seen as just a massive consolidation of the hyper ramp from 2011. Cyclically, we're on the low end, and I'd look for an uptick in price action into year end.

Clearly, 'star wars' chatter will help to raise interest in the stock, but its not just star wars of course, there is Marvel, and that is arguably as important, perhaps even more so.


'This is not going to go... the way you think', Skywalker, L. date unknown.

Seriously, its arguably just a case of whether Star Wars 8 generates 2, 3, or even $4bn in revenue for Disney.

Forward PE 15s, yield 1.6%. Not cheap, but on any basis, its not remotely expensive either.

To be clear, I am s/t bearish, but m/t bullish, seeking new historic highs (>118.62) in 2018. If you believe in Dow 40k (within 3-5 years), that would equate to $250 or so, and I recognise that can be seen as 'crazy talk'. But then.. so was $100... back in 2011.

yours... hyper bullish star destroyers

Monday 9 October 2017

GE - still mid term bearish

Whilst the main market saw a day of minor chop, there was very significant weakness in General Electric (GE), which settled -3.9% at $23.43. There is no major support until around the $22.00 threshold, which is another 6% or so lower.

GE, daily

GE, monthly


Suffice to add... mid term weak, but I suspect GE will soon be concluding its mid term bearish trend from summer 2015.

The $22.00 threshold would arguably sync up with the sp'2474/61 gap zone.

Forward PE: 14s. Yield 3.9%.   On any basis... not expensive.

If the $22s do hold, first upside target will be the $27s, which would be viable in spring 2018.

Friday 6 October 2017

GDX - back on the rise

Whilst gold and silver saw a mixed week, the miners caught a bounce. The gold miner ETF of GDX ended the week on a positive note, settling +1.6% at $23.59, which made for a very significant net weekly gain of 2.7%. Near term outlook offers further upside. First soft target is the Feb' high of $25.71.

GDX weekly

GDX monthly


So, 3 weeks down, and the gold miners are back on the rise. Clearly though, things only get interesting if the Feb' high of $25.71 is broken AND held above. Until then, its mostly been a year of broad chop.

The bigger monthly chart is even more illustrative of how price action is broadly stuck. The two clear thresholds are $31.70 and $18.58. The cautious bulls or bears, will simply sit on the sidelines until either of those are broken through.

Best guess? I'm leaning on the inflationary outlook. For now, the only sign of that is via copper, which saw a very bullish August settlement above the key $3.00 threshold.

Gold, Silver, and Copper broadly trade together, and if copper does climb into 2018, its difficult to see gold, silver, and the related mining stocks not following.

Key thresholds: Gold $1400, Silver $22s, Copper $3.00 (achieved).

Thursday 5 October 2017

NFLX - bullish stranger things

With the announcement that subscription rates would be raised for most US customers, Netflix (NFLX) jumped in early morning, breaking a new historic high, settling +5.4% at $194.39. The increase in prices is a bold, but necessary move for mid term sustainability, as high quality content doesn't come cheap.

NFLX daily

NFLX monthly


Suffice to add, price structure of a double top from 191/89 has been decisively broken above.
The door is now open to the psy' level of $200, and mainstream chatter will no doubt start murmuring the $300s... even the $500s within 2-3 years.

The price changes

Netflix has come an awfully long way from literally mailing DVDs in the mail. Now its one of the finest content producers in the world. The typical Netflix consumer is surely going to tolerate being billed one extra dollar per month.


I am bullish 'Stranger things', 'The Punisher', and a fair few other Netflix shows.

Wednesday 4 October 2017

JD - short term cooling to the 200dma

Whilst the main market broke another sextet of new historic highs, there was significant weakness in JD.com (JD), settling -2.2% at $38.34. The 200dma within the target red zone of 38/36 is highly probable, before the stock has a better chance of pushing upward into year end.

JD, daily


JD is not a stock I get around to highlighting that often, but recent price action merits attention.

JD maxed out at $48.99 on Aug'8th - prior to earnings, and is continuing to cool.. if choppily. The 200dma is a prime target, and looks due within the near term.

Mid term outlook is bullish, first soft target is the psy' level of $50. JD is a valid alternative to BABA, or the global retail monster of AMZN.

Tuesday 3 October 2017

F - trading above the downward trend

Ford Motor (F), settled higher for the fifth consecutive day, +2.1% at $12.34. This was the highest close since March 16th. Most notable though is that the stock is now sustainably trading above the mid term downward trend that began in July 2014.

F daily

F monthly


Suffice to add... we have a provisional break of the downward trend that has lasted a full three years. Now its a case of how Ford settles the month. Any monthly close >$12.00 would be very bullish. 

With a forward PE in the 7s, and a yield of around 5%, the valuation is simply.... ludicrous.

First soft target: $15. Any monthly closes >$15.50, will offer 22/23s... whether by end 2018, or 2019, it should make little difference to those on the long side.

Monday 2 October 2017

MU - already breaking into the $40s

Whilst the US equity market broke a quintet of index historic highs, there was continued significant strength in Micron Technology (MU), breaking an intra high of $40.37, settling +1.7% at $40.01. Near term outlook threatens a touch of cooling, but mid term outlook is hyper bullish, after what is a monstrously bullish breakout.

MU daily

MU monthly


*I was tempted to highlight DIS or INTC, today, but MU is too difficult to resist.

I can only suggest anyone do a little research into recent earnings, and then consider what was a powerfully bullish August settlement.

see: http://investors.micron.com/

Most recent earnings: http://investors.micron.com/releasedetail.cfm?ReleaseID=1041722

Jon Najarian, aka Dr' J, highlighting more call buying in MU

First target zone of $45/50 is clearly within range before year end. On balance, the giant $100 threshold looks on the menu in 2018, assuming the main market 'bullish train remains on the tracks'.

yours... powered by NVDA, INTC, and MU.