Posts Tagged ‘japan’

Weakening Wednesday – Market Picture Begins to Look Grim

This is not pretty.

As you can see on our Big Chart, we've failed the 50 dma on the S&P, Nasdaq, NYSE and Russell and the Russell failed its 200 dma long ago.  We're still waiting for the Dow to cross below 16,940 and confirm the carnage but we made those bets long ago with our DXD Oct $24 calls, which are now 0.70 (up 55%) from our 0.45 entry back on 9/18.

In fact, we already took 1/2 of those calls off the table at 0.85 last week so, essentially, the remainder is a free put option on the Dow for the next three weeks – with DXD at $24.45, so we gain every penny from here on up as the Dow falls.  

That's what hedges are supposed to do, of course.  We discussed that in yesterday's Live Trading Webinar, where we also demonstrated a live Futures trade on the Russell (/TF Futures) that made $500 on the 2:30 bounce.  That bounce was very easy to predict because THE MARKET IS MANIPULATED and all we had to do was wait for the same fake spike that we get at the end of every quarter, courtesy of the Fed and their fellow Banksters:

SPY  5  MINUTEWhat's scary about yesterday's flood of money ($230Bn in two days) wasn't just the size of the pump job, but the ineffectiveness of it.  The volume was still anemic and declining shares outpaced advancing shares by almost 2:1 in yesterday's "mixed" trading.  

In reality, it wasn't mixed at all as big traders took advantage of every penny that moved into the market as they told their brokers to sell, SELL!!!

Still, it's not the end of the World just yet – only close to it, and we can still turn this puppy around by holding the line on the Dow as well as Russell 1,100 and Nasdaq 4,500.  This market has been amazingly resiliant in 2014 so we're not going to be complacently bearish the same way we (thank goodness) did not let ourselves get complacently bullish this summer.  


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Friday Fakery – How Many Countries are Faking Economic Data?

I forgot to talk about something important yesterday.

Turkey was caught FAKING their trade data, with Prime Minister Erdogan, working with Economic Minister Caglayan LAST YEAR to manipulate their $800Bn economy by sending gold overseas to boost their export numbers.  How a team that included Turkey’s economy minister sought to manage the current account deficit, as the gap is called, by juicing exports to Iran is laid out in a 300-page document prepared by Turkish investigators in 2013. Caglayan and his collaborators also came away with tens of millions of dollars in bribes, according to the document, which has been cited in parliament by opposition lawmakers

The covert efforts that Caglayan and his associates undertook eventually swelled to a multi-billion dollar enterprise that reached from Ghana to China, according to the investigation. Tons of gold flowed from Turkey to Iran, much of it via Dubai. That freed up Iranian money trapped in Turkish banks, in turn boosting Turkish exports.

When the gold trade was foiled by tightening American sanctions starting in July 2013, Sarraf and his collaborators kept exporting. They sent thousands of tons of overpriced — and sometimes fictitious — food onto ships steaming between Dubai and Iran, according to the document.

That's how things are being done in the World's 18th-largest economy and, notice CHINA (3rd) is one of the countries participating in this scam, as is Iran (21st) and Dubai in the UAE (30th).  We already know China is involved in all sorts of economic manipulation, including building entire empty cities just to boost their GDP numbers.  China, in fact, is in the midst of another set of scandals, with tens of Billions (GS estimates $160Bn) in bank loans backed by silver and copper collarteral that does not, in fact, exist (maybe they "got it" from Turkey?).  

So what is the REAL Global GDP?  Clearly they aren't manipulating the numbers LOWER, so
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Which Way Wednesday – Finally Fed Up?

It's a Fed day today!

That, of course, means MORE FREE MONEY and the markets are giddy with anticipation ahead of the meeting – especially since we had more poor housing data yesterday and that's exactly the kind of bad news that is good news as it keeps the Fed in easy-money mode a little longer.  

As you may have guessed, we shorted oil this morning.  The July contract (/CLN4) expires on Friday and, as you can see from the chart, we continue to find great profits in the sell-off that we predicted would come last week.  We went over some Futures Trading Tips in yesterday's live Webinar as well as the new, bullish positions we've added to our Long-Term Portfolio.  Much as we rail against what we firmly believe will ultimately be a disastrous policy – you simply can't fight the Fed and we're not trying to – it's much more profitable to go with the flow. 

Going with the flow is exactly what we're doing with our oil trades as they STILL have 103M barrels worth of FAKE orders open for July delivery (actually, about 20M will actually be delivered so "only" 80M are fake at the moment) and that is down from the 172M FAKE orders that were open on Friday morning (see chart on Friday's post).  

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Weekend Reading – The Good, the Bad and Fukushima

Hey, remember Fukushima? 

Arnie Gundersen is freaking me out!  Gundersen is no tin-foil hat guy, he’s the chief engineer of energy consulting company Fairewinds Associates and a former nuclear power industry executive who served as an expert witness in the investigation of the Three Mile Island accident.  Gundersen has said that the U.S. nuclear industry and regulators need to reexamine disaster planning and worst-case scenarios, especially in reactors such as Vermont Yankee, which have the same design as the crippled nuclear plant at the center of the 2011 Japanese Fukushima nuclear emergency. Vermont Yankee and similar plants are vulnerable to a similar cascade of events as in Japan.

The Nikkei had fallen down to 8,227 from 10,678 (23%) at the quake and has since recovered 10,017 on May 2nd but was back to 9,648 on Friday (3.6% off the bounce) and the 50 dma has now formed an aptly-named "death cross" below the 200 dma.  Japan is already on the hook for $124Bn from the earthquake and will also have to cover TEPCO’s $31Bn (so far) liability as the alternative is let the country’s biggest energy supplier go bankrupt and that would be lights out on their economy.    

Warning: Do not watch this video on a full stomach:  

This is one of the things holding down the financials as there is no way to know right now, what the real damages are going to be from this ongoing disaster for the insurance companies (and the banks that lend them money).  As Gundersen observed on Friday and as is not being reported officially, two other reactors are seriously damaged.  A worker at the plant dropped dead on Saturday and Japanese banks and Insurance companies are all suffering with Daiici Life’s net profit down 66% from last year due to the accident.  

Accident is a funny word isn’t it?  With 435 active plant and 250 more under construction, even if they are 99.9% safe, that would still mean we get an accident like this every year.  Hopefully they are 99.99% safe and we only have a major catastrophe every 10 years – wouldn’t that be nice but, so far, that’s not the case as we’ve had about 16 in 50 years with 9 of those considered "major."  So accident applies to this situation in the same way
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Nuclear Eruptions and Health Effects

Japan’s Nuclear Volcano Erupts

Courtesy of MIKE WHITNEY

Shares plunged across Europe, Asia and the United States on Tuesday as the crisis at the Fukushima Daiichi nuclear plant deepened and Japan’s Nuclear and Industrial Safety Agency raised its radiological event scale to its highest level. Conditions at the stricken facility have steadily deteriorated despite the valiant efforts of emergency workers.  The station continues to spew lethal amounts of radiation and other toxins into the atmosphere and around the world. A French nuclear group has warned that children and pregnant mothers should protect themselves from the fallout. According to Euractiv:

"The risks associated with iodine-131 contamination in Europe are no longer ‘negligible,’ according to CRIIRAD, a French research body on radioactivity. The NGO is advising pregnant women and infants against ‘risky behavior,’ such as consuming fresh milk or vegetables with large leaves."

The group’s warning underlines the dangers posed by the out-of-control facility which is causing unprecedented damage to earth, sea and sky. But while the disaster continues to grow larger by the day,  the government’s only response has been to expand the evacuation zone and try to shape news to minimize the public backlash.

Emergency crews have braved high levels of radiation to bring the plant back under control, but with little success. A number of violent tremors and a second smaller tsunami have made their jobs nearly impossible. Thousands of gallons of radioactive water that was used as coolant has been flushed into the sea threatening marine life and sensitive habitat. The toxic release of radiation now poses an incalculable risk to the battered fishing industry and to fish-stocks around the world. These costs were never factored in when industry executives and politicians decided to exploit an energy source that can cause cancer, pollute the environment for millennia, and bring the world’s third largest economy to its knees.  

Raising the alert-rating to its highest level is an admission that a “major release of radioactive material with widespread health and environmental effects" has taken place and will likely continue for some time to come. The situation is getting worse by the day. Japan’s government will now insist on the "implementation of planned and extended countermeasures.” In other words, a red alert. The threat to water supplies, food sources, livestock and humans is grave and ongoing. The media’s efforts to protect the nuclear industry by…
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Sawdust and Radioactive Water Dumps: The Increasingly Desperate Options at Fukushima

Courtesy of TIME

By KRISTA MAHR

Leaked water believed contain radation in a photo released by Tokyo Electric Power Company on April 2.

Sawdust. It’s not the first thing most people would choose to put between themselves and highly contaminated radioactive water. But a mixture of sawdust — ogakuzu in Japanese — with chemicals and shredded newspaper is precisely what nuclear safety authorities and power plant officials turned to in trying to plug a 8-inch crack in a shaft near reactor 2 at the Daiichi nuclear power plant in Fukushima over the weekend.

Unfortunately, like the concrete they tried before it, the sawdust didn’t work, and as of Monday, the flow of irradiated water into the sea from the shaft continued unabated. “We have not succeeded yet,” Ken Morita, director of the international affairs office at Japan’s Nuclear and Industrial Safety Agency (NISA), acknowledged to TIME on Monday morning. “We will try again today.”

What will they try next? For the past three weeks, that has been the question hovering in the irradiated air above Fukushima, where each passing day seems to bring a new and unprecedented challenge for the ebattled Tokyo Electric Power Company (TEPCO) to shut down the reactors at the Fukushima nuclear power plant safely.

Since Saturday, when TEPCO announced that workers had detected radioactive water flowing directly into the ocean, the crisis of the hour has been stopping and mitigating the impact of the newly found leak. On Saturday, NISA said it had found seawater about 25 miles south of Fukushima contained twice the normal limits of radioactive iodine. Officials say dye has now been added into the water to be able to trace the movement of leaked radioactive particles, and that workers will be setting up a physical barrier near the plant to try to stop their flow out of the direct area. “There are many important things to do, but in this current situation, many people are focusing on stopping the outflow,” says Morita. “Many options are now under consideration but we have not decided on anything.”

That kind of opacity — whether a symptom of sheer improvisation or a more calculated attempt to cloak the severity of an unsolved problem — has not won TEPCO, or the Japanese authorities, any fans in the international nuclear community. Without more information about what is happening at the crippled plant, nuclear experts outside


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Fatal Radiation Detected Outside Damaged Japanese Reactor – Bloomberg

Radiation levels that can prove fatal were detected outside reactor buildings at Japan’s Fukushima Dai-Ichi plant for the first time, complicating efforts to contain the worst disaster since Chernobyl in 1986.

Water in an underground trench outside the No. 2 reactor had levels exceeding 1 sievert an hour, a spokesman for plant operator Tokyo Electric Power Co. told reporters in the capital yesterday. Exposure to that dose for 30 minutes would trigger nausea and four hours might lead to death within two months, according to the U.S. Environmental Protection Agency.

Preventing the most-contaminated water from leaking into the ground or air is key to containing the spread of radiation beyond the plant. A partial meltdown of fuel rods in the No. 2 reactor probably caused a jump in the readings, Japan’s chief government spokesman said.

“There’s not much good news right now,” said Gennady Pshakin, a former IAEA official based in Obninsk, the site of Russia’s first nuclear power plant. “There’re questions arising on how much fuel will leak out, what isotopes will be carried and how quickly they will settle. It’s becoming less predictable.”

Continue here: Fatal Radiation Detected Outside Damaged Japanese Reactor – Bloomberg.


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Tokyo Electric Finds Plutonium in Soil Near Fukushima Plant – Bloomberg

Tokyo Electric Power Co. found plutonium in soil samples taken near the stricken Fukushima Dai- Ichi nuclear plant a week ago, the company said.

The presence of plutonium outside the plant means there’s been degradation of the fuel in at least one of the six reactors, Denis Flory, deputy director general of safety at the International Atomic Energy Agency, said yesterday at a press briefing in Vienna. Tokyo Electric can’t determine which reactor emitted plutonium, Vice President Sakae Muto said in a briefing shown on a webcast.

The contamination “shouldn’t have any effect on human health,” Muto said.

Soil chemistry may determine whether the plutonium can spread from the site, Edwin Lyman, a radiological specialist for the Union of Concerned Scientists, said on a conference call. Some compounds formed by plutonium are water soluble, and some aren’t, he said.

IAEA Director General Yukiya Amano said there are “mixed signals” coming from emergency repair efforts at Fukushima. “The situation continues to be very serious,” Amano said in Vienna yesterday.

Keep reading here: Tokyo Electric Finds Plutonium in Soil Near Fukushima Plant – Bloomberg.


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Terrible Tuesday – Duck this Fip!

Now THIS is a panic!

Ordinarily, I would be very enthusiastic about buying but we were in an overbought market so we need to be very selective about what we buy.  Once again we had a lot of discussion of the Global situation in Member chat and a special 12:21am Alert went out to Members and there was a follow-up at 6:52 this morning and, frankly, we don’t really have better information at 7am than we did at midnight, which seems kind of crazy with all these 24-hour news channels and the web and all.  Instead of getting the facts instantly, it seems what we get is information overload where it’s almost impossible to separate facts from rumors.

I want to thank both Zeroxzero and Pentaxon for their excellent analysis of the nuclear situation in Japan yesterday – without their now-obviously accurate observations, we would have probably gone more bullish.  We did do some dip buying but generally with well-hedged positions except for the $25KP, where we did take a risk on FAS that will bite us in the ass.  

Once again, I apologize that it’s my job to get analytical when talking about a massive human tragedy but we need to step back and assess the situation.  I have been suggesting that people, in the very least, text REDCROSS to 90999 on your cell phones to donate $10 to help with the relief efforts in Japan – 250,000 people read me each morning and that’s $2.5M and if you pass this along to 10 friends and so on and so on we can really have some impact so please, Please, PLEASE – when you are about to buy something today – think of something you can do without and instead send $10 so a child in Japan can get fresh water to drink and a blanket to sleep on.  Thanks!  

What an interesting day for a Fed statement (2:15)!  We also have the normal Tuesday Retail Sales Reports, the Empire State Manufacturing Survey, Import/Export Prices, TIC Flows and the NAHB Housing Market Index – all important stuff but all overshadowed by events in Japan.  So, what is REAL over there?  In the morning alerts we discussed the status of the disaster and we have Members who are clearly better than I am at discerning the facts so we’ll deal with that
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Hundreds of bodies wash ashore in quake-hit Japan

This is so heartbreaking, even without a nuclear meltdown

TAGAJO, Japan (AP) — There are just too many bodies.

Hundreds of dead have washed ashore on Japan’s devastated northeast coast since last week’s earthquake and tsunami. Others were dug out of the debris Monday by firefighters using pickaxes and chain saws.

Funeral homes and crematoriums are overwhelmed, and officials have run out of body bags and coffins.

Compounding the disaster, water levels dropped precipitously inside a Japanese nuclear reactor, twice leaving the uranium fuel rods completely exposed and raising the threat of a meltdown, hours after a hydrogen explosion tore through the building housing a different reactor.

On the economic front, Japan’s stock market plunged over the likelihood of huge losses by Japanese industries including big names such as Toyota and Honda.

While the official death toll rose to nearly 1,900, the discovery of the washed-up bodies and other reports of deaths suggest the true number is much higher. In Miyagi, the police chief has estimated 10,000 deaths in his province alone.

Continue here: Hundreds of bodies wash ashore in quake-hit Japan – Yahoo! Finance.


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Phil's Favorites

Peloton IPO Guide... And Why It Makes No Sense

Courtesy of ZeroHedge

By Scott Willis via Grizzle.com

BOTTOM LINE

At the end of the day, Peloton is a gym membership pretending to be a tech company.

We fully admit the product is exciting and unique in the market, but Peloton still faces the same problem...



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Zero Hedge

Peloton IPO Guide... And Why It Makes No Sense

Courtesy of ZeroHedge

By Scott Willis via Grizzle.com

BOTTOM LINE

At the end of the day, Peloton is a gym membership pretending to be a tech company.

We fully admit the product is exciting and unique in the market, but Peloton still faces the same problem...



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Digital Currencies

Buyer beware: How Libra differs from Bitcoin

 

Buyer beware: How Libra differs from Bitcoin

Recent revelations about the lack of privacy protections in place at the companies involved in Facebook’s new Libra crytocurrency raise concerns about how much trust users can place in Libra. (Shutterstock)

Courtesy of Alfred Lehar, University of Calgary

Facebook, the largest social network in the world, stunned the world earlier this year with the announcement of its own cryptocurrency, Libra.

The launch has raised questions about the difference between Libra and existing cryptocurrencies, as well as the implications of private companies competing with s...



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Lee's Free Thinking

Look Out Bears! Fed New QE Now Up to $165 Billion

Courtesy of Lee Adler

I have been warning for months that the Fed would need new QE to counter the impact of massive waves of Treasury supply. I thought that that would come later, rather than sooner. Sorry folks, wrong about that. The NY Fed announced another round of new TOMO (Temporary Open Market Operations) today.

In addition to the $75 billion in overnight repos that the Fed issued and has been rolling over since Tuesday, next week the Fed will issue another $90 billion. They’ll come in the form of three $30 billion, 14 day repos to be offered next week.

That brings the new Fed QE to a total of $165 billion. Even in the worst days of the financial crisis, I can’t remember the Fed ballooning its balance sheet by $165 bi...



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The Technical Traders

Is A Price Revaluation Event About To Happen?

Courtesy of Technical Traders

Skilled technical traders must be aware that price is setting up for a breakout or breakdown event with recent Doji, Hammer
and other narrow range price bars.  These types of Japanese Candlestick patterns are warnings that price is coiling into
a tight range and the more we see them in a series, the more likely price is building up some type of explosive price breakout/breakdown move in the near future.  The ES (S&P 500 E-mini futures) chart is a perfect example of these types of price bars on the Daily chart (see below).

Tri-Star Tops, Three River Evening Star patterns, Hammers/Hangmen and Dojis are all very common near extreme price peaks and troughs.  The rea...



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Kimble Charting Solutions

India About To Experience Major Strength? Possible Says Joe Friday

Courtesy of Chris Kimble

If one invested in the India ETF (INDA) back in January of 2012, your total 7-year return would be 24%. During the same time frame, the S&P 500 made 124%. The 7-year spread between the two is a large 100%!

Are things about to improve for the INDA ETF and could it be time for the relative weakness to change? Possible!

This chart looks at the INDA/SPX ratio since early 2012. The ratio continues to be in a major downtrend.

The ratio hit a 7-year low a few months ago and this week it kissed those lows again at (1). The ratio near weeks end is attempting to...



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Insider Scoop

10 Biggest Price Target Changes For Friday

Courtesy of Benzinga

  • Credit Suisse raised IHS Markit Ltd (NYSE: INFO) price target from $68 to $76. IHS Markit shares closed at $67.75 on Thursday.
  • Wedbush boosted Restoration Hardware Holdings, Inc (NYSE: RH) price target from $170 to $185. RH shares closed at $169.49 on Thursday.
  • Mizuho lifted Seagate Technology PLC (NASDAQ: STX) price target from $46 to $50. Seagate shares closed at $52.94 on Thursday.
  • UBS raised the price target for Weight Watchers Intern...


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Chart School

Crude Oil Cycle Bottom aligns with Saudi Oil Attack

Courtesy of Read the Ticker

Do the cycles know? Funny how cycle lows attract the need for higher prices, no matter what the news is!

These are the questions before markets on on Monday 16th Aug 2019:

1) A much higher oil price in quick time can not be tolerated by the consumer, as it gives birth to much higher inflation and a tax on the average Joe disposable income. This is recessionary pressure.

2) With (1) above the real issue will be the higher interest rate and US dollar effect on the SP500 near all time highs.

3) A moderately higher oil price is likely to be absorbed and be bullish as it creates income for struggling energy companies and the inflation shock may be muted. 

We shall see. 

...

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Biotech

The Big Pharma Takeover of Medical Cannabis

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

 

The Big Pharma Takeover of Medical Cannabis

Courtesy of  , Visual Capitalist

The Big Pharma Takeover of Medical Cannabis

As evidence of cannabis’ many benefits mounts, so does the interest from the global pharmaceutical industry, known as Big Pharma. The entrance of such behemoths will radically transform the cannabis industry—once heavily stigmatized, it is now a potentially game-changing source of growth for countless co...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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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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