Sunday 21April2013 - The Trend Is Your Friend!

For those who think they can outsmart the market and in particular the junior resource stock market with its huge percentage swings where fortunes are made and lost, all I can say is Good Luck! As Jim Dines has repeated many hundreds of times "The Trend Is Your Friend."

So it is Very Important to be "On The Right Side of the Market."

Right now most junior resource stock gamblers have lost their shirts. Well actually most only have their socks still on. Every thing higher up has evaporated into thin air.

There will come a time when once again it will really pay Bigtime to BUY back into the junior resource sector including the precious metals in particular. But for NOW do NOT try to catch a falling 500 pound Safe. It's much heavier than you and will take you right down to the Bottom with it.

The chart below may help you get on the Right Side Of The Market. Wait until the technical signals are in your favour. A key indicator will be when downtrend lines break to the upside and the 20 Week Moving Average breaks Above the 40 Week Moving Average.

There is nothing wrong with being on the "Right Side Of The Market" and only making 100 to 200% on your trade over a couple of years. For me at least this makes more sense than trying to pick the bottom and that one stock out of 2000 that goes up 50 times. That's my 5 cents worth.

Click to Enlarge.

Don't know if this web link for the above chart works but will try to embed it in this post so that if interested you can view the updated chart on a regular basis.

  http://stockcharts.com/h-sc/ui?s=$CDNX&p=W&yr=15&mn=0&dy=0&id=p45086283605&a=289939986&listNum=22

Saturday 20April2013 - Dagwood's Take!

Click to enlarge.

Thursday 18April2013 - Changing Perceptions!

This from Danielle Park's website today.

The Bottom Line:
If the Big Bear Market is On the Radar,
Then, Rasie Cash and be Ready to Pluck some Bargains when the Financials, Utilities Sectors also plunge as FEAR takes Hold and Panicked Investors Sell at Any Price. Then We Have Bargain Days to Cherry Pick the Best Dividend Paying Stocks with Growth Potential.

Cyclical update

Posted on April 18, 2013 by Danielle Park

Cyclical sectors like gold companies (XGD below) and many commodities are now in cyclical bear market territory (down more than 20% from their highs), but the interest sensitives (like financials, REITS and utilities) still have considerable downside potential in this cycle. Unfortunately for guaranteed deposit-refugees who have run to “defensive” stocks looking for yield, bear market selling cycles generally spread across the sectors before they complete. With the 2009 cycle lows a potential test, the next few months could offer great opportunity. But only for those who can first avoid significant capital losses.
Click Chart Image to Enlarge.

 

Thursday 18April2013 - Euro Currency Comments!

From Blackswan Capital 16April2013 Monthly Newsletter.

"Italy and next-door Slovenia are rapidly coming up the radar screen as the most vulnerable to depositor flight. The Italian situation is further aggravated by the ongoing political struggle for power where two of the three major power contestants – Berlusconi and Beppe Grillo – are accumulating voter support by threatening exit from the Eurozone. The calls for Italy to exit the

Euro will gain more credibility if events in Cyprus and Greece proceed as expected.

A run on Italian banks will have major impact on French banking and, through the channel of French banks, on Belgian banking as well. French banks have an Italian exposure of €334 billion and an overall exposure to all Eurozone crisis countries of €778 billion.

Of the Eurozone banks’ total balance sheet of almost €33 trillion, roughly €11 trillion or one-third are bonds issued by banks and deposits owed to banks themselves. So whenever any single bank’s ‘shareholders, bondholders and uninsured depositors’ are expropriated, the event instantly ratchets down the solvency of every other bank, because those ‘shareholders, bondholders and uninsured depositors’ are these other banks," writes Leto Research. We don’t believe another crisis can be avoided given the global economic backdrop and the still massive structural problems still facing the Eurozone."

As a Canadian I am long the US Dollar (IE Holding US$ Deposits in Accounts) and short the Euro vs the US dollar with the ProShares Ultra Short Euro which trades as EUO-NYSE.

Click image to View.

 

Wednesday 17April2013 - Stock Market Trends - What Next?

One of the key technical indicators I watch is the NYSE Bullish Percent Index.
Yesterday (Tuesday 16April) we had a reversal to the downside. This means that more and more stocks in the 2000+ NYSE Company Listings are breaking their price uptrends and moving lower.
For the short term at a minimun we will most likey have declining stock market index values.
Trends are much easier to recognize with the following chart which is referred as a "Point and Figure" chart. This simple chart is actually covering trend changes in the SP500 for the past 13 years.

Recent History:
09Nov2012 - Down column of O's signalling most likely a drop in the SP500 then at 1377. For those so inclined to trade, one would go short the SP500 index with SDS or SH.

20Dec2012 - Quick Reversal to an UP Column of X's. SP500 at 1430. A clear signal to close your short position at a loss. This is a simple fact of trading. Close your losing positions. And for those who trade the Index go long SP500 Index ETF's. Personally I hold cash as I am already long the market with long term equity holdings.

16Apr2013 - Down column of O's signalling most likely a drop in the SP500 then at 1574. For those who went long the SP500 from the 20Dec2012 signal the trade generated a 10% return or more if leveraged with a 2X ETF such as RSU.

So the current NYSE Bullish Percent Index Chart signal is to go SHORT the SP500 Index. My trading stock to do this is SDS (ProShares SP500 2X Short) on the NYSE.

Currently I own this ETF and also own EUO which is a 2X short the EURO vs the US Dollar.

Remember these are short term trading positions and need to be closed to cut losses if the trade is not working.

Click to enlarge

Sunday 14April2013 - Dagwood's Take!

Sunday 14April2013 - Gold Market Action!

Well its been an exciting past week in the precious metals markets. Gold exploded to the downside when it broke below the US1527 dollar support shelf. As expected the break triggered a lot of stop loss sell orders.

The following Gold price chart is from Fridays EWI Short Term Financial update. The next downside target is the $1300 range around the bottom of wave 4 of wave (5). This would also be a 38% retracement of the advance from 1999.

EWI also noted that the inflation investments including gold, silver, oil and metals including DR Copper are all in decline. This would suggest that we are in a deflationary asset cycle which will eventually take its toll on the stock markets and Canadian real estate.

Perhaps Vancouver real estate is ripe for a major downward price correction. With many central Vancouver apartment condos held by so called investors but really speculators sitting with empty units (estimated at 25%) there could be a huge price crash when the speculators start to cut their losses and sell at any price in total disgust. And the current buyers of new condos for delivery several years from now will forfeit their deposits and walk away from their legal purchase obligations.  

Wednesday 03April2013 - Market Action - Gold!


Gold continues to decline toward the $1527 support shelf where three previous declines found support in 2011 and 2012.

The BIG Question is - Will Gold again find support around $1527 or will it break down below the shelf this time?

If Gold breaks below $1527 it will most likely trigger many stop  loss orders and result in a huge downward  spike.

The following chart is from EWI 03April2013 Short Term Update.

Wednesday 03April2013 - Market Action - SP500!

The S&P500 Index may have finally peaked and is reversing to the downside.

EWI in todays Short Term Update is indicating that the Elliott Wave structure from at least November 2012 is complete.

Furthur downside that breaks through uptrend lines would would increas the likehood of at least a near term correction in stock markets. And may also indicate the start of a much more serious market decline.

Other technical indicators I am watching are a reversal to the downside of the point and figure NYSE Bullish Percent Index and and a crossover of the 20 week SP500 EMA below the 40 Week SP500 EMA.

The following chart is from EWI Short Term Financial Forecast for Wednesday 03April2013.

Click to enlarge.

Wednesday 03April2013 - Just The Way It Is!

This financial crisis is forcing state and local agencies to make tough decisions.

If things continue for much longer, there's a real risk they may have to lay off Jose.

 

Wednesday 03April2013 - Dagwood's Take!

Monday 01April2013 - Dagwood's Take!