Archive for the ‘Uncategorized’ Category

Will We Hold It Wednesday – Russell 1,350 Edition

I like this chart from Panamaorange at StockTwits:

I'm not a TA guy but I do know when things are overbought and oh boy are we overbought right now.  Volume on the S&P ETF (SPY) was 57M yesterday as we busted up to new highs – that's about 1/2 "normal" volume of 100M, which is already down from 150M last year.  Low volume means low conviction and we pair that with record ETF inflows (dumb money) of $56Bn and we know exactly what this rally is made of.  Small Caps, Financials and Industrials captured most of the flows while, as noted yesterday, money is fleeing from Emerging Markets and Emerging Market Debt – we're simply the "safe haven" – for now

And, of course, money is flowing out of bonds, which are a very bad thing to hang onto when interest rates are rising and December is on pace to blow November's numbers out of the water and, like Richard Gere, that bond money has nowhere else to go except into equities – regardless of how ridiculously priced they are.

And, of course, a person dumb enough to put their money into 30-year notes at 2% isn't going to think twice about running into equities that have a p/e of 30 – that's more like a 3.3% return, at least!  That's also making dividend stocks extra expensive as the coupon clippers love dividend stocks and, as value investors, we're finding bargains very hard to find in that space but we're patient, we can wait for the correction.

Meanwhile, the Dow has climbed to the top of our target range already.  Back on 11/25, we put up a hedge against our Russell Futures (/TF) shorts (was 1,350 then too!) that would cover us for an $11,250 profit if the indexes refused to back down – at the time I said:

In fact, the Russell 2,000 is just under 1,350 and that's up 200 points since early November (not counting their spike down) and that is just shy of 15% so the Dow is MILES behind


continue reading





News You Can Use From Phil’s Stock World

 

Financial Markets and Economy

European Stocks Rally for a Third Day Ahead of ECB Meeting (Bloomberg)

European stocks on Wednesday added to the previous session’s sharp gains, boosted by advances in miners and banks. Optimism the European Central Bank will extend its stimulus program at Thursday’s meeting has spurred equity gains this week, particularly in so-called peripheral markets perceived as riskier.

Oil Extends Drop as U.S. Output Seen Countering OPEC Supply Cuts (Bloomberg)

Oil extended declines below $51 a barrel amid speculation a production boost from U.S. shale producers will counter the first output cuts from OPEC in eight years.

A huge accounting mistake shows that Britain is £6 billion worse off than we thought (Business Insider)

LONDON — The Office for National Statistics (ONS) admits it calculated the UK's trade deficit wrong.

The ONS discovered a "processing error" related to the trade in "erratic" goods, which includes gold, silver, precious stones, aircrafts, and ships.

China's Yuan Pessimists Are Multiplying (Bloomberg)

China is tightening capital controls as the imminent renewal of a foreign-exchange conversion quota adds to depreciation pressure on the yuan.

Oman Plans to Sell as Much as $2 Billion of Bonds Amid Deficit (Bloomberg)

Oman, the largest Arab oil producer that’s not an OPEC member, plans to sell between $1.5 billion to $2 billion of bonds internationally in 2017 to plug a deficit caused by low crude prices.

U.A.E. Oil Minister Says OPEC Will Act Again If Prices Decline (Bloomberg)

A cut in global oil output by 1.8 million barrels a day would be enough to balance the crude market, and OPEC is ready to take further action if prices fail to stabilize, United Arab Emirates Energy Minister Suhail Al Mazrouei said in Abu Dhabi.

Economic ‘Boom’ to Hit Denmark After Half Decade Below Zero (Bloomberg)

After half a decade of negative interest rates, Denmark’s economy is headed for an economic “boom” and risks running out of the labor resources needed to support sustainable growth, the central bank said on Wednesday.


continue reading





Let’s say you’re not optimistic about the next four years…

 

Let’s say you’re not optimistic about the next four years…

Courtesy of 

The President-elect of the United States is outraging some of our largest strategic partners before even assuming office, feuding with sketch comedy shows and literally accusing people of crimes on Twitter in the early hours of the morning.

He’s disparaging the media on a daily basis. He’s said more complimentary things about Russia than he has about our allies over the last half-century from NATO. He’s conducting unprepared phone calls with Pakistan and Taiwan – the avowed enemies of India and China respectively – and inexplicably inviting his daughter to sit in on meetings with world leaders.

This sort of thing might be making you nervous. That’s understandable. Most smart people I talk too – including Trump supporters – have their fingers crossed that he will grow into the role he’s won for himself and stop doing embarrassing shit. He might. Lots of 70 year olds turn on a dime and make wholesale personality shifts. Okay, just kidding, but I’m trying to be optimistic.

Let’s say you’re not optimistic about the next four years. Well, my friend, Bloomberg has a feature just for you: The Pessimist’s Guide to 2017. It’s a compendium of scenarios in which things go very wrong in multiple categories. It’s probably too pessimistic, but I think that’s the point of the exercise.

I’m not as worried about the trade stuff and the wall stuff as some of you, mostly because I don’t believe any of it will actually be pursued. I do worry about the potential for geopolitical mishaps that lead to armed conflict. I don’t think the undisciplined and uninformed bluster and bravado of a “business genius” is what typically makes the world safe, forgive me for feeling this way.

The Bloomberg Guide talks about things like North Korea testing long range missiles that can hold a nuclear device, about ISIS radicalizing central Asia, about Saudi Arabia and Japan developing their own military defenses further upon feeling abandoned, about Putin feeling emboldened, etc. Let’s assume you think any or all of these are legitimate concerns. Here’s one investment that might make sense…


continue reading





News You Can Use From Phil’s Stock World

 

Financial Markets and Economy

Oil falls on output cut skepticism, OPEC and Russia output rise (Reuters)

Oil prices on Tuesday ended lower for the first time since OPEC agreed on Nov. 30 to cut output, as data showing record high production in the producer group fed skepticism that it would be able to reduce supplies.

Brazil’s Reform Plan in Disarray After Senate Chief Removed (Bloomberg)

Brazil’s economic reform plan was thrown into disarray after a Supreme Court justice removed Senate chief Renan Calheiros just days before the upper house was scheduled to vote on a crucial spending cap bill.

Wall Street as Landlord: Blackstone Going Public with a $10 Billion Bet on Foreclosed Homes (The Wall Street Journal)

Jonathan Gray of Blackstone Group LP went on the biggest homebuying spree in history after the U.S. foreclosure crisis, purchasing repossessed properties from the courthouse steps and through online auctions.

A Cheat Sheet on the Deglobalization of the Financial World (Bloomberg)

From Brexit and rising polarization in Europe to the protectionist rhetoric of President-elect Donald Trump, this year's played host to a series of political ruptures that threaten a breakdown in the existing internationalist order

One Historic Lens Says Trump Stock Market Lovefest Just Starting (Bloomberg)

The post-election advance in U.S. stocks fits into a pattern at the beginning of presidential cycles, and if history is any guide the rally greeting Donald Trump is only halfway done.

STOCKS HIT NEW HIGH, OIL DROPS: Here's what you need to know (Business Insider)

US stocks finished higher but little changed on Tuesday, and the Dow closed at an all-time high. Crude oil fell for the first day since OPEC agreed last Wednesday to cut production.

U.S. ‘Disappointed’ by Japanese Plan to Cut Drug Costs (The Wall Street Journal)

The U.S. government has written to a senior aide of Japan’s Prime Minister Shinzo Abe, calling on Tokyo to reconsider a plan that would allow more frequent pharmaceutical price cuts.

Here's how media giants see the future of advertising (BI Intelligence)

The media buying arms of the world's largest advertising holding companies have released their ad spend forecasts


continue reading





Uncle Ricky, could you read us a bedtime story? Please?

 

Uncle Ricky, could you read us a bedtime story? Please?

Courtesy of 

[Yesterday] morning, the US stock market reacted to PM Renzi’s lost Italian referendum with a gigantic IDGAF, the Dow printing a new all-time high within minutes of the open. Hell, even the euro gained on the news – which is hilarious if you’re in the camp that says the odds of a Euro Zone break-up increase with every populist victory at the polls.

I call this phenomenon “crisis fatigue”. If everything is a crisis, then nothing is. BTW, Italy has now had 63 “new governments” since WWII so IDGAF is perhaps the most appropriate of responses, historically speaking.

Here’s a highly prescient tweet from Barbarian Capital I want to share with you:

 

 

Some smart people are telling the story that the market reacted positively to the news because “a euro without Italy and its debt burdens is actually a stronger currency / economic union.” Perhaps they’ll feel the same when Le Pen sweeps through France like a hurricane. Is a euro without France stronger? How about without the Netherlands? Should Germany leave to really make it rock-solid?

Another story being told is that the Italian referendum’s ‘no’ vote was extremely well-telegraphed and that, on its own, it doesn’t mean an exit from Europe – all it means is a caretaker government through 2018 where very little gets done or changed.

One more story – US stocks are now the safety trade again for global fund flows, so that chaotic happenings elsewhere serve to make the S&P 500 more desirable for those pulling money out of geopolitcal harm’s way. This is probably the most absurd one.

I would just say to be careful with narratives. Like sentiment – or Greek mythology for that matter – they are always ad hoc, and designed to explain the inexplicable.

Besides, a price reversal later this week (or later today!) will invalidate any…
continue reading





Sugar Pills

 

Sugar Pills

Courtesy of 

I know I’m doing a lot of stuff about the alleged “Trump Rally” lately but I have good reasons: First of all, it’s the most dominant story in the market by far, now that the Fed is basically PGing a rate hike.

And second, it’s absolutely absurd and people are running around acting like maniacs, which I love. You guys know I love that.

Anyway, my friend Nick Colas, Chief Strategist at Convergex, a global brokerage firm in New York, put something out about how Americans are more susceptible to “the placebo effect” than patients anywhere else around the world. When you tell them they’re taking a drug, they are more prone to believe that it’s working and actually show improvement. Especially with psychiatric drugs although the effect is not limited to those.

American investors are the same people as American drug trial candidates, more or less, so it should be no surprise that they’re acting as though we already got a trillion in infrastructure spending, tax cuts, lap dances and whatever else might be coming.

It’s a sugar pill. The medication isn’t in our system yet but we believe it’s working already. You should see some of the sell-side research hitting my box. Anyway, here’s Nick:

The real magic of the current domestic stock market rally is that it pretends to forecast (with remarkable precision, it must be said) a set of legislative outcomes in 2017. You know the list: lower corporate and personal taxes, less regulation, more infrastructure spending.  All this may come to pass, for after all President Elect Trump has the notional backing of a Republican Congress, and therefore the GOP essentially “Owns” the U.S. economy for the next 2 years.  But even the most bullish assessment of this scenario must admit that it seemed very unlikely just a month ago.  And yet investors have no problem bidding up risk assets like they just KNOW how the world will look in a year.

It is at times like these that I consider the Placebo Effect from the world of medicine.  That’s the one where patients and research subjects report beneficial effects from a substance


continue reading





Comment by jabobeast

View Single Comment

  1. jabobeast

    no but i am long JO and TEVA 

    what a week







Comment by jabobeast

View Single Comment

  1. jabobeast

    no but i am long JO and TEVA 

    what a week







News You Can Use From Phil’s Stock World

 

Financial Markets and Economy

European Stocks Little Changed With Industry Rotation on Hold (Bloomberg)

European stocks were little changed, as a recent rotation out of so-called defensive sectors and into shares seen benefiting from economic growth eased. Utilities and real estate companies climbed with banks, while miners trimmed recent lofty gains.

Yuan Rises for a Second Day as Fixing Signals Government Support (Bloomberg)

China’s yuan rose for a second day after an unexpectedly strong central bank fixing spurred speculation that policy makers are supporting the currency.

Europe's tech investors desperately want more certainty from Brexit (Bloomberg)

LONDON — A year ago, tech investors were playing an anxious game of introspection over frothy market conditions: Are we in a bubble? Are we heading for a crash?

Pound’s climb pulls FTSE 100 lower; spread betters hit hard (Market Watch)

U.K. blue-chip stocks sagged Tuesday, hurt by a rise in the pound, while shares of spread-betting firms in the mid-cap market plunged after regulators said they will crack down on certain products.

German Factory Orders Surge on Demand for Investment Goods (Bloomberg)

German factory orders surged in October, suggesting growth in Europe’s largest economy will accelerate at the end of the year.

Mexico’s Oil Future Now Calls From an International Country Code (Bloomberg)

“What’s the country code for Australia?” Pemex Chief Executive Office Jose Antonio Gonzalez Anaya asks the six people in his 44th-floor office in Mexico City on Monday afternoon. “Is it 61? This might be our new partner calling.”

Markets mull next move; Italian bank wobbles; AutoZone earnings (CNN Money)

Investors have shrugged off a series of big political shocks in the last few weeks, and many global stock markets are in bull market territory -- up 20% or more from lows set earlier in 2016.

OPEC deal may already be running into trouble, says this chart (Market Watch)

Analysts say investors may have popped the champagne cork too early on last week’s historic production cut from OPEC, a deal that helped fuel a nearly


continue reading





Trumperific Tuesday – What Could Possibly Go Wrong?

Everything is awesome!  

We did get some awesome Consumer Spending numbers yesterday but, as you can see from the chart, it's more of a reflection of inflation than of a confident consumer that's out shopping.  The cost of "essentials" has risen sharply since May, up 8% while discretionary spending has remained flat.  I imagine when the credit card data comes out – we'll see that a lot of this spending has been debt-financed – not the best kind of spending...

Still, the market hates nuance so YAY!!!  Speaking of nuances, did you know that Fitch, Moody's and the S&P have taken a record 1,971 negative ratings actions on emerging-market sovereign and government-related entities in 2016 – and the year isn't even over yet!  Isn't that awesome???  Not since 2007-2008 have we had this kind of uptick in negative ratings and back then the record was only 1,400 – we shattered that in September!

Now I'm not going to say this is a bad thing because NOTHING is a bad thing as far as this market is concerned but, it's kind of a bad thing.  26% of the 134 Sovereigns rated by Moody's still have a negative outlook – so things can get even worse.  When a sovereign defaults, there's a domino effect of companies, private and state-owned, that follow. For once, S&P, Moody's and Fitch may be giving investors early indications of what to expect. The message for now is clear: Developing nations are no longer doing that well.  

I'm not going to dwell on the negative, not when Bloomberg did such a good job of it in their "Pessimist's Guide to 2017".  


We tried shorting yesterday and that failed, with our stops quickly broken to the upside but we're at is again today.   In yesterday's post, I said the Nikkei (/NKD) was my favorite short at 18,500 and we made a +$500 move down to 18,400 (now back to 18,450) but that was disappointing given the Dollars sharp fall back to 100 so today we're not into them but we do have 19,225 on the Dow Futures (/YM) and those components are very stretched and oil
continue reading





 
 
 

Zero Hedge

Our "Gaslight" Economy

Courtesy of ZeroHedge. View original post here.

Submitted by Charles Hugh-Smith via OfTwoMinds blog,

If you don't like what these charts are saying, please notify The Washington Post to add the St. Louis Federal Reserve to its list of Russian propaganda sites.

Yesterday I described our gaslight financial system. Today we'll look at our gaslight economy. Correspondent Jason H. alerted me to the work of author Thomas Sheridan (...



more from Tyler

ValueWalk

PIA Flight PK-661 With 47 Oboard Crashes Near Abbottabad [List Of Passengers]

By Vikas Shukla. Originally published at ValueWalk.

A Pakistan International Airlines (PIA) flight on its way from Chitral to Islamabad on Wednesday has reportedly crashed near Havelian in Abbottabad. The PIA flight PK-661 departed from Chitral at 3:30 pm local time, and was supposed to reach Islamabad’s Benazir Bhutto International Airport at 4:40 pm. The plane disappeared from the air control radar soon after the take-off.

Image source: Faisal Akram / FlickrJunaid Jamshed and his family were among 47 onboard

There were 47 people on board the plane, including five crew members. The list of passengers included popular singer Junaid Jamshed and his family. According to ...



more from ValueWalk

Kimble Charting Solutions

Gold Bugs testing support cluster at this time!

Courtesy of Chris Kimble.

Gold Mining stocks started off the year like a rocket ship. Over the past 20-weeks, the popular Gold Miners ETF (GDX) has declined nearly 35%. This is one of its larger 20-week declines in its history! Create an opportunity? We think so!

This decline has the Gold Bugs Index (HUI) at a rare price point in the chart below.

CLICK ON CHART TO ENLARGE

...

more from Kimble C.S.

Phil's Favorites

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

European Stocks Rally for a Third Day Ahead of ECB Meeting (Bloomberg)

European stocks on Wednesday added to the previous session’s sharp gains, boosted by advances in miners and banks. Optimism the European Central Bank will extend its stimulus program at Thursday’s meeting has spurred equity gains this week, particularly in so-called peripheral markets perceived as riskier.

Oil Extends Drop as U.S. Output Seen Countering OPEC Supply Cuts (Bloomberg)

Oil extended declines below $51 a barrel amid speculation a p...



more from Ilene

Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Oil falls on output cut skepticism, OPEC and Russia output rise (Reuters)

Oil prices on Tuesday ended lower for the first time since OPEC agreed on Nov. 30 to cut output, as data showing record high production in the producer group fed skepticism that it would be able to reduce supplies.

Brazil’s Reform Plan in Disarray After Senate Chief Removed (Bloomberg)

Brazil’s economic reform plan was thrown into disarray after a Supreme Court justice removed Senate chief Renan Calheiros just days before the upper house was scheduled to vote on a crucial spending cap bill. ...



more from Paul

Chart School

Russell 2000 in Take Profit Territory

Courtesy of Declan.

The Russell 2000 pushes again into the 10% zone of historic high prices (1,388 would be enough for the 5% zone last seen in February 2011). Back in 2011 the index rallied for another couple of months before it lost 30% from its high.  The next few weeks would be a good opportunity to take some money off the table to use on the next swing low.


On the Daily chart the 'sell' trigger in MACD reversed with a new 'buy' trigger.

...

more from Chart School

Members' Corner

Trump, Meet The New Boss?

Courtesy of Nattering Naybob.

Over at Philstockworld... High Finance for Real People - Fun and Profits... 

StJL - "Once again, I think that the middle class voters who turned in great numbers for Trump will soon realize that they voted against their best economic interest. Trump will only be part of the equation – the GOP Congress can't wait to weaken the social safety nets that are so needed by the same people who are so happy today. But too late now I guess"
No surprises here as all along we maintained the memory of what happened in 2000. With that fresh in mind, rather than forgotten in the past, we knew that given the indoctrination of the electorate, anything was possible and history keeps repeating itself...

more from Our Members

Promotions

Phil's Stock World's Las Vegas Conference!

 

Come join us for the Phil's Stock World's Conference in Las Vegas!

Date:  Sunday, Feb 12, 2017 and Monday Feb 13, 2017.            

Beginning Time:  8:00 am Sunday morning

Location: Caesar's Palace in Las Vegas

Notes

Caesar's has tentatively offered us rooms for $189 on Saturday night and $129 for Sunday night. However, we have to sign the contract ASAP. We need at least 10 people to pay me via Paypal or we may lose the best rate for the rooms. (Once we are guaranteed ten attendees, I will put up instructions to call the hotel for individual rooms.)

The more people who sign up,...



more from Promotions

OpTrader

Swing trading portfolio - week of December 5th, 2016

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 ...



more from OpTrader

Digital Currencies

Largest US Bitcoin Exchange Is "Extremely Concerned" With IRS Crackdown Targeting Its Users

Courtesy of ZeroHedge. View original post here.

Last Thursday we reported that in a startling development seeking to breach the privacy veil of users of America's largest bitcoin exchange, the IRS filed court papers seeking a judicial order to serve a so-called “John Doe” summons on the San Francisco-based Bitcoin platform Coinbase.

The government’s request is part of a bitcoin tax-evasion probe, and se...



more from Bitcoin

Mapping The Market

The Most Overlooked Trait of Investing Success

Via Jean-Luc

Good article on investing success:

The Most Overlooked Trait of Investing Success

By Morgan Housel

There is a reason no Berkshire Hathaway investor chides Buffett when the company has a bad quarter. It’s because Buffett has so thoroughly convinced his investors that it’s pointless to try to navigate around 90-day intervals. He’s done that by writing incredibly lucid letters to investors for the last 50 years, communicating in easy-to-understand language at annual meetings, and speaking on TV in ways that someone with no investing experience can grasp.

Yes, Buffett runs an amazing investment company. But he also runs an amazing investor company. One of the most underappreciated part of his s...



more from M.T.M.

Biotech

Epizyme - A Waiting Game

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

Epizyme was founded in 2007, and trying to create drugs to treat patient's cancer by focusing on genetically-linked differences between normal and cancer cells. Cancer areas of focus include leukemia, Non-Hodgkin's lymphoma and breast cancer.  One of the Epizme cofounders, H. Robert Horvitz, won the Nobel Prize in Medicine in 2002 for "discoveries concerning genetic regulation of organ development and programmed cell death."

Before discussing the drug targets of Epizyme, understanding epigenetics is crucial to comprehend the company's goals.  

Genetic components are the DNA sequences that are 'inherited.'  Some of these genes are stronger than others in their expression (e.g., eye color).  Yet, some genes turn on or off due to external factors (environmental), and it is und...



more from Biotech

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...

more from David



FeedTheBull - Top Stock market and Finance Sites



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...

Learn more About Phil >>


As Seen On:




About Ilene:

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.

Market Shadows >>