Archive for March, 2009

You know how we hate handicapping stocks, but …

Posted on Mar 31, 2009 by .

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This one was so obvious that it jumped out of the chart book and for what it’s worth we point it out.  The penetration of the horizontal signal line is not overly impressive, but the run up to the breakout is impressive.

STX –Seagate — looks like something is going on with drives.

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DBA, DBC

Posted on Mar 31, 2009 by .

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It is only a matter of time until commodities blow the next bubble.  DBA and DBC are two instruments which give the non futures investor a way to participate.  As such we should be keeping an eye on these so they don’t sneak out of town under cover of night.  At the moment there are no buy signals here, and a slight downwave.  Sometimes we break the rules and buy before a breakout, because in cases like this the breakout is often explosive and getting on the rocket can be dicey.  We might stick a toe in if price gets to the lows.

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Turbulence — as predicted last Thursday

Posted on Mar 30, 2009 by .

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Last Thursday we observed that we expected some days of turbulence.  This has come to pass, with the rally being off 410 points (5%) in two days.  This downdraft in the rally will probably continue, as the very short term momentum is now in line with the long term momentum.  The prospect of tough love from Obama for GM and Chrysler gave the market just the excuse it needed to bail from long trading positions — as you should have done if you had positions of that kind.  We think the rest of the week will be volatile and probably continue to see price erosion.  In a few days we might know whether the March low is to be tested.  While these appear to be news events we regard them as sub rosa technical, occurring because the rally was too far too fast.  And — the day was dramatic –with the discharge of Waggoner of GM and the flaunting of the bankruptcy word.  Trading shorts — of short term duration — might be put on here, but we would have a very tight stop on them — today’s high plus a smidgeon, or 

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Island tops in the currencies?

Posted on Mar 27, 2009 by .

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Looking at FXF and FXE today it appears that island gaps — reversal signals have appeared in these two issues.  Clearer in the FXF.  Possibly a buy signal in the UUP.  The market is still open and the jury is still out, but that’s what it looks like.

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How much is enough? Or, enough already.

Posted on Mar 26, 2009 by .

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Having been fat bears for sometime feeling the wounds of the bull’s horns is no fun.  It will of course be more fun if you observed our caution to put on long hedges and take some profits and scale out some.  Now the question is when will the bulls be satisfied.  Contrarians and traders everywhere are licking their chops and looking for the first opportunity to get short off this rally.  We too think the rally is a limited time move.  We think (not a thought, but an analysis) that the recent low will be revisited.  this is partly based on the thesis that the market intends to drive as many people crazy as possible, and a good rally here and then another dive would drive most investors screaming mad.  The present rally is 22.48% and 15 days.

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