Author Archive for Zero Hedge

Google Is The Biggest Lobbying Spender In Tech

Courtesy of ZeroHedge. View original post here.

The fact that many major tech companies are headquartered in Silicon Valley doesn’t mean they don’t have a voice in Washington as well. As Statista's Feliz Richer notes, according to documents filed in accordance with the Lobbying Disclosure Act, companies such as GoogleFacebook and Amazon spend millions every year trying to legally influence D.C. lawmakers.

The following chart shows how the lobbying expenditure of Google, Apple, Facebook and Amazon has developed over the past few years. For additional information please refer to the official database.

Infographic: Google Is the Biggest Lobbying Spender in Tech | Statista

You will find more statistics at Statista

Interestingly, the quarterly filings not only reveal how much the companies spend on their lobbying efforts, they also provide us with information on which issues these efforts are related to.

Take Google for example: in the second quarter of 2017, the search giant spent $5.9 million on lobbying with respect to issues ranging from more obvious ones such as regulation of online advertising and immigration of highly skilled individuals to more surprising ones such as wind power and unmanned aerial systems technology.





The Dynamics Of A Riot

Courtesy of ZeroHedge. View original post here.

Authored by Jeff Thomas via InternationalMan.com,

In my lifetime, I’ve had the misfortune of being present in two major natural disasters and one violent social crisis. Each taught me valuable lessons.

In the aftermath of a natural disaster, there’s the danger of the loss of shelter, services, and food. In most cases, people who experience the loss of shelter and services realise that “things are bad all around” and they tend to do the best they can, accepting that life will be hard for a period of time.

Food is a different matter. People, no matter how civilized, tend to panic if they become uncertain as to when they will next be able to eat. And, not surprisingly, this panic is exacerbated if they have dependents, particularly children who are saying, fearfully, “Daddy, I’m hungry.” As Henry Lewis said in 1906, “There are only nine meals between mankind and anarchy.” Quite so.

Intelligent, educated, otherwise peaceful people can be driven to violence and even murder if the likelihood of future meals becomes uncertain. This has been the cause of spontaneous riots throughout history.

But this is not the only cause of riots. In the post-1960 period in the West, a new phenomenon has occurred that has steadily grown: Governments and the halls of higher education have increasingly taught people that they are “entitled.” Governments have been guilty of this for millennia, beginning at least as early as the “bread and circuses” of ancient Rome. It’s a way for governments to get people to be dependent upon them and thereby to do their bidding. But, since the 1960s, it’s become a systemic norm.

And it always ends in the same way. The false economy of “free stuff” eventually devolves into overtaxation and economic collapse. When it does, people are more likely to riot, as the entitlements are “owed” to them. In today’s world, however, this condition has peaked far beyond what the world has ever seen before.

Increasingly, those who are angry that the free stuff they are receiving is not enough to placate them take to the streets. Typically, they throw rocks and Molotov cocktails, burn cars at random, destroy buildings, and loot stores. All


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A Shocking Thing Happened To College Tuitions In 2016…

Courtesy of ZeroHedge. View original post here.

The staggering inflation rates of college tuition over the past couple of decades has been a frequent topic for us.  As the Wall Street Journal notes today, the cost of educating our snowflakes has soared since the early 90's and outstripped overall inflation by nearly 4x.  It seems that the liberal indoctrination of an entire generation is very expensive business.

U.S. college tuition is growing at the slowest pace in decades, following a nearly 400% rise over the past three decades that fueled middle class anxieties and a surge in student debt.

Tuition at college and graduate school—after scholarships and grants are factored in—rose 1.9% in the year through June, broadly in line with overall inflation, Labor Department figures show. By contrast from 1990 through last year, tuition grew an average 6% a year, more than double the rate of inflation. In that time, the average annual cost for a four-year private college, including living expenses, rose 161% to about $27,500, according to the College Board.

Some schools are offering more discounts and cutting prices.

Alas, there may be hope yet as for the first time in nearly 30 years college tuition rates in 2016 only increased at approximately the same rate as overall inflation…shocking.

Student Loans

Of course, it's no surprise how we got here.  The combination of yet another massive debt bubble in student loans, rising government subsidies and soaring demand from a generation of snowflakes programmed to believe their self-worth is directly correlated to how much money their parents drop on their anthropology degree resulted in a predictable supply/demand imbalance and massive prices increases.

Student Loans

So, what caused the 2016 slowdown?  Among other things, Congress decided to stop arbitrarily hiking the student loan caps back in 2008.

Another factor: Congress last increased the maximum amount undergraduates could borrow from the government in 2008. Some economists have concluded schools raise prices along with increases in federal financial aid. A clampdown on aid, in turn, could limit the ability of schools to charge more.

Meanwhile, as anyone who has ever invested in commodity markets is undoubtedly aware,


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Lagarde Hints At IMF Being Based In China In Future

Courtesy of ZeroHedge. View original post here.

In a comment sure to stir up questions over dollar hegemony (and new world order conspiracy thoughts), IMF Managing Director Christine Lagarde admitted during an event today in Washington that The International Monetary Fund could be based in Beijing in a decade.

As Reuters reports, Lagarde said that such a move was "a possibility" because the Fund will need to increase the representation of major emerging markets as their economies grow larger and more influential.

"Which might very well mean, that if we have this conversation in 10 years' time…we might not be sitting in Washington, D.C. We'll do it in our Beijing head office," Lagarde said.

Lagarde's comments build on questions raised in May on The IMF's push for World MoneyYi Gang, the Deputy Governor of the People’s Bank of China disclosed to the IMF panel that,

“China has started reporting our foreign official reserves, balance of payment reports, and the international investment position reports.”

“All of these reports, now, in China are published in U.S dollars, SDR and Renminbi rates… I think that has the advantage of reducing the negative impact of negative liquidity on your assets.”

What that means in real terms is that China views the opportunity of being a part of the exclusive world money club as an opportunity to diversify away from the U.S dollar.

The Bank of China official took that message even further saying that he hopes that China could lead in world money operations by integrating it into the private sector.

Yi Gang

“If more and more people, companies and the market use SDR as unit of accounts – that would generate more activity in the market with focus on the MSDR. [The hope would be] that they could create more products and market infrastructures that would be available for trade products to be denominated in SDR.”

The People’s Bank of China official referenced how this trend was already underway. Just last year Standard Chartered bank began to maintain accounts in SDR’s. “In terms of the first and secondary markets


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Barclays Exit Of Energy Business Triggers Surge In Oil Options Trades

Courtesy of ZeroHedge. View original post here.

Several hours before the US stock market opened on Monday, the commodity world was shaken by an unexpected surge in crude options trades, with traders noting that "someone is either moving positions, blown up or getting out of commodities. MASSIVE amount of blocks going through in crude options."

Someone is either moving positions, blown up or getting out of commodities. MASSIVE amount of blocks going through in #crude #options.#OOTT

— Mark Scullion (@mscullion) July 24, 2017

A Bloomberg alert shortly after confirmed the huge size of trades crossing the tape, when nearly $100 million in oil options traded simultaneously:

WTI crude oil options traded the equivalent of 48m bbl of contracts via block, according to data compiled by Bloomberg.

  • Total value of all options combined is ~$99m
  • Options include contracts from September 2017 through December 2020
  • 5 largest blocks were: 4.4k Dec. $90 calls, 2.8k Dec. $60 calls, 2.5k Dec. $125 calls, 1.7k Dec. $95 calls, 1.4k Dec. $46 calls
  • Click here for Excel detailing the value of each trade
  • Trades all took place at 9:35am London time
  • Contracts also traded with 9.6k lots of futures
  • Similar trades also occurred on Brent in smaller volumes ~10:35am London time

As it turns out later, it wasn't a fund liquidating, but Barclays selling the last part of its legacy oil book to an unidentified buyer, that triggered the surge in trading of exotic options most of which were written in the era of higher crude prices, Bloomberg reported this afternoon.

The size of the trade, which set traders on alert earlier, represented some 48 million barrels of contracts which "represents more than a quarter of the entire volume on an average trading day."

Barclays announced that it was exiting its energy trading business altogether last December – which until that point had been housed in its macro-trading unit – when the British bank joined an exodus that analysts then said raised concern among oil producers that falling liquidity means they cannot use derivatives for their basic function: to


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Jordan Releases Footage Of Green Berets Killed While On Secret CIA Syria Mission

Courtesy of ZeroHedge. View original post here.

Jordan has just released the previously suppressed CCTV video footage of last year's heinous attack on 3 Green Berets by a Jordanian soldier and ISIS-sympathizer as they entered a desert facility to conduct training operations as part of a CIA secret program aimed at regime change in Syria.

Last week we reported the following:

"The Jordanian government had a strong incentive to gloss over the murders of the three Green Berets.  Likewise, the CIA was scared of potential blowback and the exposing of their covert program," says investigative journalist Jack Murphy, himself an Army special forces veteran.

A premeditated green-on-blue attack in Jordan outside of King Faisal Air Base (at al-Jafr in Southern Jordan) late last year resulted in the deaths of three elite US Green Berets in what the media initially dubbed a mere unfortunate gate incident and what the Jordanian government dismissed as a "a tragic accident devoid of any terrorist motives". But the whole event and subsequent attempts at cover-up just as Obama was leaving office enraged both the families of the slain and the US special forces community; and it further threatened to blow wide open the CIA's illegal Syrian regime change operation, called Timber Sycamore, which involved American special ops soldiers being tasked with training so-called "moderate" Syrian rebels in Jordan and Turkey as part of an inter-agency program.

As details of the court case involving the shooter continue to emerge this week, the media continues to misreport the true nature of the what the US special forces personnel were doing in Jordan in the first place, and how a CIA secret program put them at risk.

Last November the three Green Berets were entering King Faisal Air Base assigned as part of the CIA's 'Timber Sycamore' training. According to court testimony as well as evidence collected by the Pentagon, a soldier in the US-allied Jordanian Army opened fire as the Green Berets' convoy was stopped in front of the base. The Jordanian guard fired for six minutes, reloading multiple rifle magazines. The Jordanian government and media attempted to paint a picture that the approaching US convoy charged the gate and


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Google Slides As Cost-Per-Click Tumbles

Courtesy of Zero Hedge

Google, aka Alphabet, reported Q2 earnings that beat on the top and bottom line, reporting EPS of $5.01, above the estimate of $4.45, and earnings per share excluding the $2.7 billion European Commission fine of $8.90, also above the $8.25 expected. Total Q2 revenue of $26.01 billion rose 21% Y/Y, and also beat consensus of $25.64BN.

Yet while Google's top and bottom line results were both impressive, the reason why the stock was down as much as 3.6% in the after hours appears to be that while Google reported paid clicks in Q2 surged by 52%, well above expectations of a 35% increase, and more than the 44% in Q1, Google's cost-per-click – which measures what advertisers pay when people click on search ads that show up alongside the results served up by Google’s search engine – tumbled 23%, a drop from the -19% CPC reported in Q1 and down even more from the -15% in Q4 2015.

In other words, more people are clicking on ads, but those clicks are costing advertisers less money per click, and generating less sales for GOOGL. In short, a potential revenue mix concern where Google is compensating for lower pricing power (due to the encroachment of Facebook?) with higher ad volumes.

One thing is certain: the CPC trend is certainly not Alphabet's friend:

Additionally, Q2 Revenue ex-Traffic Acquisition Costs was $20.92 Billion, modestly below the $21.07 billion consensus estimate.

Some other details:

  • 2Q Other Bets revenue $248 million
  • 2Q Other Bets operating loss $772 million
  • 2Q Google advertising revenue $22.67 billion
  • 2Q free cash flow +$4.57 billion

While the stock initially responded favorably, surging to new all time highs above $1000, the latest print was down 2.5% as the market digests the potentially disappointing revenue mix data.





“Apprehension”: Main Events In Torrid Week Include Fed, GDP, Earnings And “Lots Of White House Risk”

Courtesy of ZeroHedge. View original post here.

"Apprehension" – that's how Citi describes trader sentiment as a new week begins, in which the bank points to various event risks over the coming five days. The one markets are focusing on over say, the FOMC on Wednesday, is the political noise coming from Washington. The investigation into Russia’s alleged meddling in the 2016 election is back in focus as President Trumps’ son-in-law testifies, along with Trump Jr and Paul Manafort later in the week. As such, risk sentiment seems apprehensive ahead of the inevitable headlines

Indeed, near term White House risk is substantial and is as follows: Jared Kushner appearing before Senate intelligence committee on Monday; the Senate healthcare vote is expected Tuesday; Donald Trump Jr. and former Trump campaign Chairman Paul Manafort are expected to appear on Wednesday before Senate committees investigating Russian meddling.

On the economic front, next week attention will be on the US FOMC rate decision, Q2 GDP data, consumer confidence, housing and durable goods orders. We also get GDP, composite PMI and CPI inflation releases across the Euro Area. GDP data in the UK. In Emerging Markets, there are monetary policy meetings in Colombia, Brazil, Turkey and Russia.

It is also the busiest week for Q2 earnings with dozens of marquee names reporting.

As Jim Reid summarizes, the highlight this week are today's flash PMI numbers and the FOMC meeting this Wednesday, although the latter will likely be a relatively mundane affair with the action perhaps being saved for a September balance sheet announcement. One also has to keep an eye on all things Washington related following Friday's announcement of Press Secretary Sean Spicer's resignation. Mr Trump now has new people at the helm of both his legal and communications teams after resignations towards the end of last week. Late on Friday Congressional negotiators agreed to advance a bill punishing Russia for its involvement in the 2016 election and also restricting Presidential powers to remove sanctions on Russia. It will now go to a vote and if it passes Trump could be in a difficult situation as he has publicly stated he wants improved relations with Russia but clearly if Congress has voted for the bill he'd be seen as siding with Putin if he didn't respond positively when


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Property Market In Dublin Is Inflated and May Burst Again

Courtesy of ZeroHedge. View original post here.

Commercial Property Market Is Inflated and May Burst Again

by David McWilliams

Dublin property investors had better hope that Brexit happens soon.

They should also hope that it’s not just a ‘hard’ Brexit, but a granite Brexit — a Brexit that’s as hard as possible. They should be betting on the buffoonery of Boris Johnson, down on both knees praying for a massive barney between Davis and Barnier.

A granite Brexit might prompt the migration of hundreds of corporate refugees from isolated London to the freewheeling safe haven of Dublin. If Brexit doesn’t drive a massive uptake in demand for prime property, we are in for a massive wobble in our inflated commercial property market.

Before we remind ourselves how this property story goes, let’s have a look at the facts: the glossy brochures are back, stockbrokers are packaging all sorts of property-related products to “investors”, the price of ad space in the property porn sections of the press is surging and of course the skyline is full of cranes and Armagh flags.

CBRE – a property-flogging outfit – tells us there are currently 31 office schemes under construction in Dublin, which is more than 380,000sqm in the pipeline. They tell us that more than 30% of this stock is already let. It also gushes that 44% of the office stock due for completion before the end of this year has already been pre-let. Meanwhile, agents tell us that prime office rents in the Dublin market stand at approximately €673 sqm.

It looks like things couldn’t be healthier.

Office take-up in Dublin surged 101,000sqm in the past three months, bringing total take-up in the first half of this year to more than 150,000 sqm. That’s a lot of space. 81 individual large office lettings were signed in Dublin since March (45 to Irish companies; 18 to US firms and 11 to the Brits). This is more than double the figure for the period from January to March.

The market is tight, hence all the building. The vacancy rate in the city centre is only 4.5% and yields for investors are stable at 4.6%. This is only because rents have been


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UBS Downgrades Goldman On Slump In Trading Revenues

Courtesy of ZeroHedge. View original post here.

The knives are out early this morning among the brokers, where UBS – hardly the embodiment of ibanking and sales and trading health these days – just downgraded Goldman Sachs to Neutral, cutting its price target from $250 to $235, on the recent disappointing results from the company's FICC group. UBS said it believes the market is pricing in an "inflection" in Goldman's trading revenue despite the recent weakness suggesting a recovery is needed to justify 2018 consensus estimates. The bank concedes that "recent weak results could rebound but believe a recovery in trading revenues would need to be substantial as we estimate a roughly 25% rebound in FICC revenues is implied in 2018 consensus estimates."

It adds that "while trading could rebound, that has not happened over the past year for GS absent a surprise event such as Brexit or the Trump election and we have difficulty relying on such an event in order to justify a bullish thesis."

As a result, UBS has "limited confidence" in a FICC rebound at Goldman and sees better opportunities for investors elsewhere, such as Morgan Stanley (and why note even UBS shares).

From UBS:

Shares seem to reflect a rebound in revs but we have limited confidence in that

We are downgrading GS shares to neutral as the market seems to be pricing an inflection in their FICC revenues despite the recent weakness, suggesting a recovery is needed to justify 2018 consensus. We believe there are better opportunities for investors (such as buy-rated MS). Importantly, adjusting for unusual items (ie low taxes, excess I&L, etc) 1H17 earnings missed consensus forecasts as of mid-Feb 2017 (before revisions began) by 19.2%, yet the stock is down by 12.1% and consensus 2018 estimates are only down 7.2%, suggesting to us that the street is largely willing to embed a recovery in GS, trading results.

We recognize recent weak results could rebound but believe a recovery in trading revenues would need to be substantial as we estimate a roughly 25% rebound in FICC revenues is implied in 2018 consensus estimates. While trading could rebound, that has not happened over the past year for GS absent a surprise event such as Brexit or the Trump election and we have difficulty relying on such an event in order to justify a bullish thesis.





 
 
 

Phil's Favorites

Senate GOP advances a health care bill. Now what?

 

Senate GOP advances a health care bill. Now what?

Courtesy of Jeffrey Lazarus, Georgia State University; David McLennan, Meredith College, and Rachel Caufield, Drake University

On July 25, Senate Majority Leader Mitch McConnell narrowly managed to keep a Republican effort to reform health care alive. We asked our experts to consider the importance of this procedural vote and what happens next.

Jeffrey Lazarus, Georgia State University

Which...

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ValueWalk

Illinois and Connecticut Face Pension Collapse

By insidesources. Originally published at ValueWalk.

It’s shocking to see the budget horror stories coming out of two of the nation’s leading states. Illinois and Connecticut are in fiscal freefall, and their leaders are taking the exact wrong approach in their misguided efforts to turn things around. If they were smart, they would look to the example of states like Florida to discover how to weather fiscal storms.

tpsdave / Pixabay

Illinois faces a staggering budget gap of close to $10 billion, a crisis worsened by a state pension program funded at just 37 percent and credit downgrades that leave th...



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Zero Hedge

"If The VIX Goes Bananas", Morgan Stanley Shows What It Would Look Like

Courtesy of ZeroHedge. View original post here.

From Chris Metli of Morgan Stanley

It’s easy to become numb to the low volatility environment and the risks it presents.  While trying to pick a trough in vol has been a fool’s errand, focusing on the risks resulting from vol being so low is not.  Low volatility has produced a regime where the risks are asymmetric and negatively convex, so being prepared for an unwind is critical.  This is not a call that vol is about to spike, but you need a plan if it does.

This note details how a short vol unwind might develop. A violent rise in volatility c...



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Digital Currencies

SEC Cracks Down On "Initial Coin Offerings": Concludes Tokens Are Subject To Securities Laws

Courtesy of ZeroHedge. View original post here.

In potentially groundbreaking news for the blockchain community, moments ago the SEC issued a press release, referencing an investor bulletin on Initial Coin Offerings, which concluded that DAO Tokens, a Digital Asset, are securities for ...



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Biotech

Biologics: The pricey drugs transforming medicine

Reminder: Pharmboy and Ilene available to chat with Members, comments are found below each post.

 

Biologics: The pricey drugs transforming medicine

Courtesy of Ian HaydonUniversity of Washington

The cells inside this bioreactor are the real pharmaceutical factories. Sanofi Pasteur, CC BY-NC-ND

In a factory just outside San Francisco, there’s an upright stainless steel vat the size of a small car, and it’s got something swirling inside.

The vat is stud...



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Insider Scoop

Morgan Stanley Joins Bull Thesis TEAM On Atlassian Corporation

Courtesy of Benzinga.

Related Benzinga's Top Upgrades, Downgrades For July 25, 2017 20 Stocks Moving In Monday's Pre-Market Session ...

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Chart School

Tech Gaining Momentum. Small Caps Recover.

Courtesy of Declan.

Tech markets continued the good work from Friday as buyers continued to bid up the Nasdaq and Nasdaq 100. Large Caps posted small losses but this was more about attention elsewhere than any Large Cap specifics.

The Nasdaq experienced a mini-breakout from the consolidation over the last 3 days (traders on the hourly time frame may find some joy here) which keeps the index on course to test larger upper channel resistance. Technicals are net bullish but its relative performance against peer indices which is doing particularly well; Large Caps in particular.

...

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OpTrader

Swing trading portfolio - week of July 24th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Members' Corner

Why we need to act on climate change now

 

Why we need to act on climate change now

Interview with Jan Dash PhD, by Ilene Carrie, Editor at Phil’s Stock World

Jan Dash PhD is a physicist, an expert at quantitative finance and risk management, and a consultant at Bloomberg LP. In his thought-provoking book, Quantitative Finance and Risk Management, A Physicist's Approach, Jan devotes a chapter to climate change and its long-term systemic risk. In this article, Ilene interviews Jan regarding his thoughts on climate change and the way it can affect our futu...



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Mapping The Market

The App Economy Will Be Worth $6 Trillion in Five Years

Courtesy of Jean-Luc

This would be excellent news for AAPL and GOOG to a lesser extent although not inconsequential:

The App Economy Will Be Worth $6 Trillion in Five Years 

In five years, the app economy will be worth $6.3 trillion, up from $1.3 trillion last year, according to a report released today by app measurement company App Annie. What explains the growth? More people are spending more time and -- crucially -- more money in apps. While on average people aren't downloading many more apps, App Annie expects global app usership to nearly double to 6.3 billion people in the next five years while the time spent in apps will more than double. And, it expects the...



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Promotions

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Bill Olsen from NewsWare will be giving us a fun and lively demonstration of the advantages that real-time news provides. NewsWare is a market intelligence tool for news. In today's data driven markets, it is truly beneficial to have a tool that delivers access to the professional sources where you can obtain the facts in real time.

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Kimble Charting Solutions

Brazil; Waterfall in prices starting? Impact U.S.?

Courtesy of Chris Kimble.

Below looks at the Brazil ETF (EWZ) over the last decade. The rally over the past year has it facing a critical level, from a Power of the Pattern perspective.

CLICK ON CHART TO ENLARGE

EWZ is facing dual resistance at (1), while in a 9-year down trend of lower highs and lower lows. The counter trend rally over the past 17-months has it testing key falling resistance. Did the counter trend reflation rally just end at dual resistance???

If EWZ b...



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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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