Friday, November 30, 2007
Edit (1:44) Well, blogger is aware of the issue and they rec'd a workaround which of course didn't work. I cannot fiddle with this any longer. Time is of the essence lately, especially now that jamming with a couple guys in a barn has morphed into a near full fledged band with songs that need to be written. You know I will upload files here or on the Commentary blog when ready. Meanwhile, I will try to keep up with markets and charting but it is not the priority it once was. There is always the TA onDemand link over there on the right if you want me to work up any particular charts. ;-)
Have a good weekend!
Wednesday, November 28, 2007
Edit (11:25) And here we see the continued reaction of the oil bulls. Gold was vulnerable to the majority who bought it because "high oil is causing inflation!" and this combined with its still over bought weekly chart, makes us vulnerable. It is annoying watching others' mis perceptions hold sway, but it is what it is; a market correcting itself of its excesses and purifying the investor base to ever-smarter money.
Separately, the SOX and tech stocks are right on track to our view. I will not pretend I did not have a couple white knuckle moments after making that bullish call. But this may be more than just short covering as the wild ups and downs of the last couple days imply we have seen the making of a pained, well fought bottom. I remain bullish on tech - for a swing trade if nothing else.
Edit (1:01) Adding an HUI-Gold ratio chart. As you know, gold stocks rising in tandem with one of their cost inputs (oil) made me uneasy. We are entering a phase that will ultimately be very bullish. Gold is being hit by weak oil and the slowing inflation pablum. Think about this though; what is hurting gold now is absolutely necessary for the next leg up to 900. The Fed must have the leeway to drop rates and add the next round of inflation policy that the stock market is currently celebrating. They cannot do that with gold @ 800 and oil @ 100. At least they can't do it without looking like total snake oil salesmen. The big picture remains gold positive as it is THE monetary inflation barometer. But first it needs to shake off its economically positively correlated commodity cousins. The gold miners, as leveraged plays on the metal will look to smash the upside of the ascending triangle in the ratio and then the party really gets going. Until then the name of the game is survive and know who and what you are and why you are doing what you are doing.
Tuesday, November 27, 2007
Monday, November 26, 2007
Last week I put up the previous post with a fairly bullish stance but also the willingness to admit I was wrong. I am not there yet, but I see a bright red neon sign that says EXIT and I am keeping my eye on it. This is not a market for the faint of heart, not with cash and S/T treasuries still providing return and bullion of course being bullion (ie, enduring, invaluable). Here is an interesting chart comparision of how the Dow & XAU have gone on very different paths (Dow threatening to fail those levels & XAU above important support and not even in the same time zone as the Aug. lows) since the first dunk of the 2007 angst-o-rama began in August.
Friday, November 23, 2007
But things have changed in the Semiconductors which, in hitting 401.86 earlier this week have satisfied the goal of getting to "something near my target of 400" which has been noted here on the blog for several weeks now off of that clear Head & Shoulders top. Also, the weekly chart shows what 'could' one day be viewed in the rear view mirror as a buying opportunity. We shall see.
With the outright bearishness evident in various market sentiment indicators and with the idea that Central Banks' liquidity policies - in response to the various mortgage and credit market meltdowns - are equal opportunity pumpers, I have begun adding some household names in semiconductors and big tech. You know the names. I either own or am watching closely the likes of Intel (INTC), Texas Instruments (TXN), Broadcom (BRCM), Microsoft (MSFT), QLogic (QLGC) and Cisco (CSCO). I am also keeping an eye on the beaten up semiconductor equipment stocks. These big techs and semi's, generally sporting healthy balance sheets and global market reach, are benefiting from the easy monetary policy of a Fed trapped in a box. Where will the next bubble be? Big tech fits the bill on the short list of possibilities. Think about the implications of financially sound global companies receiving monetary stimulus (and a beneficial weak USD) that they don't really need.
Let me say that with all of the dramatic goings on in the markets, it is quite pleasing to note how rampant fear and angst have become, from professional Wall Street to retail Main Street. I am on Jim Sinclair's email list and I tell you I read some extremely frightening input from this seasoned gold market veteran - and I do not take it lightly. But short of a leveraged, derivative ignited financial domino accident, things are shaping up bullish folks. I am getting bullish, I don't know how else to put it. In a recent post, A-B-C or H-O-P-E the marvelous up day last week was seen for what it was, short covering and hope. But now, after further downside, the path may be cleared for a rally with more longevity.
But I always manage risk and readers should as well. When you start from a base of caution and prudence then you can take steps to potentially profit from the fear and herd mentality of others. That is what I am currently doing; potentially setting up to benefit from fear riddled markets that have been pounded down to support. One must be selective and ultimately willing to be wrong and admit it. But you don't make money buying Wall Street's bullish touts. You make it by being brave when others are... Bueller? FEARFUL. You make it when others are fearful. Cash and equivalent levels remain healthy and continue to generate return in the safest short term Treasury vehicles. This helps in the effort to "be brave".
Tuesday, November 20, 2007
Monday, November 19, 2007
In my opinion the precious metals indexes are now much healthier as they are getting a good shake out and gold is getting to our targets shown in this chart. I am not your paid guru and you are totally free to disagree and go running for the hills - along with so many of those spec momo's who don't seem to know why they do what they do. I will hang out here however, where I am comfortable; with shrapnel flying all around and emotion getting out of hand. This correction could drag on a bit but weekly charts are by no means anything but bullish. Monthlies even more so.
Friday, November 16, 2007
You recall my post from April illustrating a 'blow off' to the 530 area? It over shot, but the big picture was bearish and still is. Anything I buy will/would be for a trade pending ongoing evaluation. PS: Here is a follow up chart from July. The point I am trying to make is that perspective is everything. Fortunately for sober traders, there are many more who get drunk on the thrill of the moment and lose perspective. They are the people whose shares I am considering buying when they capitulate soon.
Thursday, November 15, 2007
Wednesday, November 14, 2007
With all the hysterics of the last couple weeks, Huey remains in an uptrend and the broad stock market is in a downtrend. This could change, but what's the old adage? Oh yes, stay with relative strength and avoid relative weakness... or something like that.
Tuesday, November 13, 2007
You saw the VIX ramping. You saw the Yen explode (up to resistance). You saw silly bulls stampeding all over the countryside. It was a deeply over sold stock market. Will this 3rd bearish event of 2007 work out the same as March & August before it and clear the way for a manic rise? As I wrote previously, maybe. But all that is happening as of this writing is an over sold market is bouncing (yey WalMart! yey tanking oil!) and I don't buy it. I have lower targets for a couple semiconductor and tech stocks but as always, if the bullish stance proves itself, I will not fight it and may even join it. I noted the 1st objective on the chart.
Monday, November 12, 2007
I have a good cash level ready and plan to deploy it. But I am not going to blab to the blog about it in detail because these events are for each of us to weigh on our own and buying & selling in difficult markets is best left to the individual so that he or she feels 100% responsible for his or her actions. I hold a core of gold stocks and this 'event' is being looked at as an opportunity by me at this point. Nuff said.
Wednesday, November 7, 2007
I was traveling this afternoon and missed the festivities. Will be out of commission for all or most of tomorrow as well. Good luck.
Tuesday, November 6, 2007
Separately, a blog reader named Doug had given me a 'tip' on a silver miner called Silver Dragon last year. It ran into some financing issues and listing issues among other things and it dropped off my radar. A couple days ago I saw it spammed somewhere and decided to have a look. This is of course after the fact reporting but I bought it at .60 & .63 after doing a bit of research and checking the chart (bottom feedus extrordinaireous) and am up 40% & 33% in 2 or 3 days. Why do I bring this up? 1) Because I am psyched! But also 2) because this is what starts happening to the deep juniors after the major PM indices have broken out. Bottle rockets all around... wheeee!!! Edit (11/7 @ 10:48) SDRG sold in trading for 60% and held in other ports currently 58%. Nothing like silver stocks when they get a bit in their mouth.
PS: I added a link over there on the right, just under the BV banner where you can check the spot price in real time. It's really neat, especially this morning looking at $819/oz.
Monday, November 5, 2007
Vancouver, British Columbia – Silver Wheaton Corp. (“Silver Wheaton”) (TSX,NYSE:SLW) is pleased to announce that it has acquired 2,500,000 common shares of Mines Management, Inc. (“Mines Management”) (AMEX:MGN,TSX:MGT) at a price of US$4.00 per share for a total purchase price of US$10,000,000. The proceeds of the offering are primarily intended for use on further development of Mines Management’s Montanore silver-copper project (the “Montanore Project”), one of the world’s 30 largest silver deposits.
As a result of this transaction, Silver Wheaton owns 11.2% of the outstanding shares of Mines Management and has been granted a right of first refusal over any silver stream sales by Mines Management from any of its projects in Montana.
Mines Management’s 100%-owned Montanore Project is located in northwestern Montana. The Montanore Project is reported by Mines Management to host mineral resources of 166 million ounces of silver and 1.2 billion pounds of copper in the measured and indicated categories and a further 65 million ounces of silver and 500 million pounds of copper in the inferred category (refer to the table at the end of this news release for further details).
“With this investment, Silver Wheaton now has a significant stake in six of the top 30 largest known silver deposits in the world,” said Peter Barnes, President and Chief Executive Officer of Silver Wheaton. “Of these six projects, Silver Wheaton has silver stream agreements in place with two, Peñasquito and San Dimas, and is the largest shareholder in companies owning a further four, being Revett Minerals Inc., Sabina Silver Corporation, Bear Creek Mining Corporation and now Mines Management. In addition, we have rights of first refusal over future silver stream sales with both Mines Management and Sabina Silver Corporation. This demonstrates the strength of Silver Wheaton in the silver sector, and our potential for significant further growth.”
Silver Wheaton has acquired the Mines Management shares for investment purposes and may acquire additional securities or dispose of its beneficial ownership, control or direction over securities through market transactions, private placements, treasury issuances or otherwise as circumstances or market conditions warrant or arise.
Mines Management has reported that, as of October 14, 2005, the Montanore Project had the following measured, indicated and inferred mineral resources:
(Ounces per ton)
- The estimate above, which is prepared in accordance with Canadian National Instrument 43-101, was prepared by Mine Development Associates for Mines Management. The technical report, which includes metal pricing and other parameters, was filed by Mines Management on March 6, 2006 and can be found at www.sedar.com.
- The above resources are reported using a cut-off of 1.0 silver ounce per ton.
Mr. Steven Ristorcelli, R.P. Geo., C.P.G. of Mine Development Associates, Inc. and David C. Fitch, C.P.G., associate of Mine Development Associates, who are “qualified persons” as such term is defined under National Instrument 43-101, have reviewed and approved the mineral resource estimates for the Montanore Project contained in this news release.
Silver Wheaton is the largest public mining company with 100% of its operating revenue from silver production. The Company expects to have silver sales of approximately 13 million ounces for the year ended December 31, 2007, increasing to 28 million ounces by 2012. Silver Wheaton is unhedged and well positioned for further growth.
Friday, November 2, 2007
USU Q3 profit more than triples & Centrifuge still on track
This goes nicely with the Korean Utility contract
This blogger would like to thank you for the email that alerted me to this opportunity to buy other people's angst at near rock bottom prices.
Edit (10:06) On the flip side of the ledger, I am in some pain here with JBLU & LUV and have a psychological dynamic working where I am actually hoping the XAL will break down and the two stocks will lose the last vestiges of support so I can be done with them (ah market psych, you gotta love it). Dow & SPX appear to be in a 'C' leg down of an ABC correction, which in itself could ultimately prove healthy. But I am ready to manage risk and raise more cash here if need be as the profits of the last several weeks are not going back. Good luck.