Wednesday, September 17, 2014

Cycles Say Silver Will Be Stronger Than Gold – Charles Nenner Research



Gold continues its struggle this Tuesday and Kitco News speaks with Charles Nenner Research’s managing director David Gurwitz to find out what the cycles are telling him. Gurwitz says that although gold may go as low as the $1,120 level, he expects the metal to bounce soon. “It’s the process of bottoming and it could still go a little lower,” he says. “But we are looking to go long pretty soon.” Gurwitz also says he expects the dollar to start heading down starting next year. “We generally look at gold in dollar terms,” he says. “We think gold is going to retest its highs down the road.” Looking at silver, Gurwitz says he sees a more promising future for the industrial metal. “Silver is going to be stronger than gold, we think silver can double.” Tune in now to see what the cycles are telling him about unemployment, nonfarm payrolls, CPI, and more! 
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Winter is Coming! Here's My Favorite Seasonal Trade: Natural Gas

Over the years, I've been successful trading weather patterns as they relate to commodities such as crude oil, gasoline and grains. As unpredictable as the weather can seem, there are patterns, and traders who get ahead of the crowd can exploit them for reliable profits.
Today, I'm going to share one of my favorite seasonal trades with you, and that is the tendency for natural gas prices to rise in the winter months as the colder weather spurs demand for use in home heating.
Natural Gas Prices
Source: U.S. Energy Administration
For seven of the past 10 years, the price of natural gas has risen between the beginning of September and the end February, with an average gain of 17.6%.
The Farmers' Almanac predicts the 2014-2015 winter will again bring record cold temperatures for most of the nation. And with natural gas prices near historical lows, this would all but guarantee higher prices over the next few months. (more)

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Sanctions against Russia could spur $150 oil – Former BP chief

Western sanctions against Russia, coupled with ongoing political instability in Libya and the advance of ISIS militants in Iraq, could leave the global oil supply exposed and push up oil prices to $150 per barrel, former BP chief Tony Hayward has warned.
The former CEO of BP and now chairman of Glencore Xstrata said the recent boom in US shale production has painted an unrealistic image of the world’s global oil supply, and created a false sense in energy security.
“The world has been lulled into a false sense of security because of what’s going on in the US,” Hayward said in an interview with the Financial Times.(more)
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YY Inc (NASDAQ: YY)

YY Inc., through its subsidiaries, operates an online social platform in the People’s Republic of China. The company engages users in real-time online group activities through voice, video, and text on personal computers and mobile devices; and enables users to create and organize groups of various sizes to discover and participate in a range of activities, including online games, music activities, education, live game broadcasting, and conference calls. Its principal product is YY Client, which enables users to engage in live interactions online; and provides access to user-created online social activities groups. It also offers Web-based YY that enables users to conduct real-time interactions on the Web without any downloads or installations; and Mobile YY, a mobile application.
Take a look at the 1-year chart of YY (Nasdaq: YY) below with my added notations:
1-year chart of YY (NASDAQ: YY)
YY has been trending consistently higher for the last 4 months while forming a clear trendline of support (red). However, the stock had also formed at 52-week high resistance at $90 (blue). At some point YY was going to have to break one of those two levels, and late last week the stock broke to a new high.

The Tale of the Tape: YY broke though its $90 resistance, which was also a new 52-week high. A long trade could be made on a pullback down to the $90 level with a stop placed below that level. A break back below $90 should lead to a fall down to the trendline support.
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Kohlberg Kravis Roberts & Co. (NYSE: KKR) : This Private Equity Play Yields 7.8%

It’s easy to see why the private equity business stirs up a fair bit of controversy…
These companies are able to invest in ways that certainly aren’t accessible to the average investor.
And they can use this unfair, insider advantage to their benefit time and time again.
The good news is, the average investor can trade alongside these insiders — and generate income at the same time. (more)

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Double Your Money AND Double Your Income in 10 Years (Or Less!): W.P. Carey Inc. (NYSE: WPC),Kinder Morgan Energy Partners LP (NYSE: KMP), Hannon Armstrong Sustainable Infrastructure Capital, Inc. (NYSE: HASI)

As a full-time researcher and writer about the stock market, I find it interesting that the mainstream financial news spends so little time discussing dividends, dividend focused stocks such as REITs and MLPs.
They often actually discuss dividend payments as a negative for stock investing results. This is contrary to my research that shows a combination of attractive yield and steady distribution growth may be the surest path to greater wealth and income. I have come to realize that there are two reasons why the financial press and investment advisors who appear on the financial networks either ignore or disparage dividend focused investing strategies: (more)

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Tuesday, September 16, 2014

KWN SPECIAL: TRIGGER FOR WORLDWIDE CRASH, MAJOR MARKETS & MORE – John Mauldin:


kingworldnews.com / Sunday, September 14, 2014
PLEASE CLICK ON PICTURE TO LISTEN TO THIS EXCLUSIVE INTERVIEW
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Tesla TSLA Breaks Down From Traditionally Bullish Pennant

Shares of Tesla are down Monday morning after breaking down from what normally is a bullish continuation pattern. This tight consolidation throughout the first half of September is what most technicians would consider a bullish pennant that traditionally resolves itself in the direction of the underlying trend. But in this case, the pattern broke down rather than up.
Here is a daily candlestick chart of $TSLA where you can see this break. The bulls are still in control here from an intermediate perspective as long this resistance from February and August turns into support. Our polarity principles teach us that former resistance should become support:
9-15-14 tsla
So far this appears to be the case as shares of TSLA stopped dropping once they hit this 264-265 level. But a break below that could be disastrous for this popular momentum name.
I would also use this uptrend line from the May lows as a key level for risk management. Bulls are fine as long as that 264 holds, otherwise a test of this uptrend line is in the cards. If neither one of those can serve as support, then a test of the 200 day moving average is likely, which is near the 210 level.
Something else worth mentioning is that a breakdown below this former resistance near 264 would confirm that this breakout earlier this month was a failed move, and would suggest a fast move to the downside is coming. So although we do have that uptrend line in the 250s, the former resistance shaded in gray is really my key level.
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Three Charts Every Trader Should See Now

It's one of the biggest disputes in the market...
 
Folks who do fundamental analysis figure folks who do technical analysis might as well use tea leaves to make investing decisions. Folks who do technical analysis point out the fundamental analysts can be right about a company's value... and still lose huge amounts of money.
 
Then there's sentiment analysis: Die-hards in both camps call it too "touchy feely."
 
Me? I don't take sides.
 
I like to say we're "mercenaries" in my trading service, DailyWealth Trader. We go wherever the market will pay us. And when I'm looking for a good trade, I use all three types of analysis. They all have something to offer...(more)
 
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Actavis plc (NYSE: ACT)

Actavis plc, an integrated specialty pharmaceutical company, is engaged in the development, manufacture, marketing, sale, and distribution of pharmaceutical products in the Americas, Europe, the Middle East, Africa, Australia, and the Asia Pacific. It operates in three segments: Actavis Pharma, Actavis Specialty Brands, and Anda Distribution. The company also develops and out-licenses generic pharmaceutical products primarily in Europe through its third-party business; and provides products in women’s health, urology, gastroenterology, and dermatology therapeutic categories.
Take a look at the 1-year chart of Actavis (NYSE: ACT) below with added notations:
1-year chart of Actavis (NYSE: ACT)
ACT started the year off with a bang by running from about $170/share up to $230. However, since that time the stock has traded mostly sideways, while creating a relatively clear level of resistance at that same $230 (blue) mark. That resistance level was also obviously a 52-week high resistance. Earlier this week, ACT broke to a new high, and the $230 level should now provide support on any pullbacks. A break below $230 could signal a false breakout.

The Tale of the Tape: ACT broke out to a new 52-week high. A long trade could be made near $230 with a stop placed below that level. A break back below $230 would negate the forecast for a continued move higher.
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Oil prices falling, but maybe not for long: Jefferies



Oil prices have fallen 15% over the past year, and they could slide further before stabilizing. That's good news for U.S. consumers who are paying an average of $3.41 for a gallon of regular gasoline -- the lowest price in six months, according to AAA.
"There's some downside still on prices, but I think we're near the bottom here," says Andrew Lebow, a senior VP for energy derivatives at Jefferies Bache. "Maybe another dollar or two on WTI and maybe another dollar or two on Brent.... We’re near the lows."

Monday, September 15, 2014

Martin Armstrong-Next Decline Will Be Far Worse Than Last One



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Yara International ASA (YARIY): A Dirt-Cheap Global Fertilizer Producer

According to the United Nations, the world needs to produce 60% more food by 2050 to avoid mass unrest.
At that point, the global population is expected to reach a whopping nine billion people. More mouths to feed, combined with the higher caloric intake of increasingly wealthy societies, will dramatically increase food demand.
Yet, as I wrote last week, the investing herd has stampeded out of agribusinesses.
The Market Vectors Agribusiness ETF (MOO), which was a crowd favorite in 2011, has experienced significant outflows totaling $2.8 billion year to date.
This ETF holds phosphate and potash producers such as Mosaic (MOS) and Potash Corp. of Saskatchewan (POT), in addition to farming machinery manufacturers such as Deere & Co. (DE) and Kubota Corp. (KUBTY).
I’ve scoured the full list of holdings for hidden value, and there was one company in particular that caught my eye…

Scandinavian Value

That company is Norway-based Yara International ASA (YARIY), the world’s largest producer of ammonia, nitrate, and complex fertilizer. Yara has sales in more than 150 countries and helps crop producers provide food for a growing global population.
With low debt levels and the equivalent of $1 billion in cash, Yara’s balance sheet is pristine. That, combined with strong earnings, translates to a very low enterprise value-to-EBITDA ratio of 7.8x. Yara also has an attractive price-to-sales (P/S) ratio of 1.0x.
By comparison, Syngenta AG (SYT), the company with the largest weighting in MOO, has an EV/EBITDA ratio of 13.0x and a P/S ratio of 2.2x. These metrics should give you an idea of the tremendous opportunity that Yara shares represent.
Yara also produces ample free cash flow (FCF) to cover its dividend payments. In the latest 12-month period, the firm generated nearly $2 billion in FCF with a respectable FCF margin (FCF as a percent of sales) of 8.8%.
Yara’s valuation is all the more surprising because the company is well-positioned for growth. In Latin America, its crop nutrition solutions are helping improve crop yields and quality. For instance, Brazil – which has become an agricultural powerhouse – is Yara’s biggest market.
Yara’s primary share class trades on the Oslo Stock Exchange with a market capitalization of $13.6 billion (85.8 billion NOK). Additionally, there are American depositary receipts (ADRs) trading under the ticker YARIY that give U.S. investors an easy way to invest.
Now, foreign withholding taxes on dividend payments are an additional factor to consider with ADRs. Luckily, it’s not a huge concern with Yara. Net of taxes, YARIY still has a solid dividend yield of 2.5% (based on 2014’s annual distribution).
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Macy’s, Inc. (NYSE: M)

Macy’s, Inc., together with its subsidiaries, operates stores and Internet Websites in the United States. Its stores and Websites sell a range of merchandise, including apparel and accessories for men, women, and children; cosmetics; home furnishings; and other consumer goods. The company also operates Bloomingdale’s Outlet stores that offer a range of apparel and accessories, including women’s ready-to-wear, fashion accessories, jewelry, handbags, and intimate apparel, as well as men’s, children’s, and women’s shoes. As of February 2014, it operated approximately 840 stores under the Macy’s and Bloomingdale’s names in 45 states of the United States, the District of Columbia, Guam, and Puerto Rico, as well as the macys.com and bloomingdales.com Websites; and 13 Bloomingdale’s Outlet stores.
Take a look at the 1-year chart of Macy’s (NYSE: M) below with added notations:
1-year chart of Macy's (NYSE: M)
M had been trending mostly sideways from February until mid-August. The stock had also created a relatively clear level of resistance at that $60 (blue) during that period of time, and that level was also a 52-week high resistance. The break through that resistance led to a run up to $63. Pullbacks to $60 should provide support, while a break below $60 could signal the end of the run.

The Tale of the Tape: M broke out to a new 52-week high. A long trade could be made near $60 with a stop placed below that level. A break back below $60 would negate the forecast for a continued move higher.

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ReneSola (NYSE: SOL): Under $5 Stock Could Soar 30% in the Next 8 Weeks

Earlier this month, China's National Energy Administration issued an updated policy concerning distributed generation of solar power. Basically, the changes were meant to encourage local governments to promote the increase of solar installations on the rooftops of private homes and businesses. Buyers understandably flocked to solar power stocks.

ReneSola (NYSE: SOL), a Chinese manufacturer of solar wafers and modules, was a big beneficiary of renewed investor interest. The small cap soared on the news and was up more than 20% in three days before backing down a bit. But don't let that percentage scare you, as the stock trades at very low prices. What is more important is that it scored a technical breakout that suggests there is a lot more upside ahead.

Before continuing, I want to emphasize that a stock with a low dollar price is not necessarily cheap. If the prevailing trend is down then low prices can get even lower. What is critical is that the stock show signs of strength in the form of investor demand, upside momentum or a surge in volume and/or volatility. Preferably, it will have all of these, but perfect setups are not the reality most of the time.  (more)

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US Weekly Economic Calendar

time (et) report period Actual CONSENSUS
forecast
previous
MONDAY, SEPT. 15
8:30 am Empire state index Sept.   16.0 14.7
9:15 am Industrial production Aug.   0.3% 0.4%
9:15 am Capacity utilization Aug.   79.2% 79.2%
TUESDAY, SEPT. 16
8:30 am Producer price index Aug.   0.0% 0.1%
WEDNESDAY, SEPT. 17
8:30 am Consumer price index Aug.   0.0% 0.1%
8:30 am Core CPI Aug.   0.2% 0.1%
8:30 am Current account Q2   -- -$111 bln
10 am Home builders' index Sept.   57 55
2 pm FOMC statement        
2:30 pm Yellen press conference        
THURSDAY, SEPT. 18
8:30 am Weekly jobless claims Sept. 13
306,000 315,000
8:30 am Housing starts Aug.   1.03 mln 1.09 mln
10 am Philly Fed Sept.   24.0 29.3
12 noon Financial accounts Q2      
FRIDAY, SEPT. 19
10 am Leading indicators Aug.   -- 0.9%
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Saturday, September 13, 2014

Why the Next Stock Market Crash Will Happen Any Day Now

by Christian Hill, Money News:
There is overwhelming evidence that the next stock market crash could strike any day now, and a growing number of investors are turning to a noted economist to prepare for the “unthinkable.”
The message is clear: Despite the Dow hitting pre-crash highs, companies reporting positive earnings, and the financial media saying we are looking at the “beginning of a new bull market,” the stock market is on the verge of another historic collapse.
The evidence is in a group of charts released by some of the biggest names on Wall Street.
Individually, these charts may not mean much. But taken collectively, they are simply too much for any investor to ignore.
Read More @ MoneyNews.com
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RBC: 4 Gold-Miner Stocks That Could Rise More Than 40 Percent

While gold has languished in a range of $1,250 to $1,350 an ounce for most of the last six months, Royal Bank of Canada sees opportunity among gold miner stocks.

According to a recent report obtained by 24/7 Wall St., RBC predicts four gold-miner stocks will gain more than 40 percent. The analysts rate all four as outperform.
  • Agnico Eagle Mines (Ticker: AEM). It recently co-purchased Canada's Osisko Mining. RBC has a price target of $49, compared with its Wednesday closing price of $34.05.
  • Barrick Gold (ABX). It has raised almost $4 billion through asset sales and new equity. RBC has a price target of $25, compared with a price of $16.74 at Wednesday's close.
  • Goldcorp (GG). It has focused on cost cutting in recent years. RBC has a $37 price target, compared with a price of $25.22 at Wednesday's close.
  • Kinross Gold (KGC). It may be an attractive acquisition candidate for a company seeking reserves. RBC has a $5.50 price target, compared with a price of $3.69 at Wednesday's close.
Agnico, Barrick and Goldcorp also pay dividends.

"With RBC expecting gold to trade at around the $1,400 level from 2015 to 2018, solid money can be made by the savvy and well-run miners at that level," 24/7 Wall St. noted.

As for the metal itself, gold hit a three-month low Wednesday.

"Political turmoil in various parts of the world that made gold attractive earlier this year seems to have eased, and now economics is overriding geopolitical events," Frank McGhee, head dealer at Integrated Brokerage Services, told Bloomberg.

"People are moving to the dollar, as the U.S. is emerging as the safe-haven economy."

Gold fell near a three-month low early Thursday. Spot gold slipped 0.2 percent to $1,246.15 an ounce, after dropping to a three-month low of $1,243.56 in the previous session. U.S. gold futures added $1.40 an ounce at $1,246.90.

"While gold may face further pressure in the current macro environment, a pick-up in physical demand would help stem the possibility for further losses," HSBC analysts said in a note, Reuters reported. "Physical demand appears light despite gold's price decline so far in the month."

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10-Year Yield could move up over 150%

The Power of the Pattern suggested that interest rates were about to blast off in May of 2013, because it looked like a bullish inverse head & shoulders pattern in yields was in play. (see post here) What happened right after that posting? Interest rates experience the largest 18-month rally in yields in the past 30-years, beating the next biggest rally by 50%! (see rate aberation here)

Could an even larger bullish inverse head & shoulders pattern in yields be taking shape? The Power of the Pattern suggests it could be possible, if a few other developments take place.

It appears that a larger inverse H&S pattern in the 10-year yield could be forming. What needs to happen to make this huge rate rally possible? First step is to break above falling resistance in yields that has formed as rates have fallen this year. If a break of that resistance takes place, the next huge step is to see if rates can break above very stiff & heavy resistance at the neckline of this potential bullish yield pattern.

Joe Friday says.....If it does push above the neckline, the "measure move projection in rates" suggests that the yield on the 10-year note could reach almost 7%.

Besides bonds (TLT), watch Utilities (XLU) and Real Estate (IYR) to see if these interest rates sensitive sectors reflect concerns about rising rates.
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Speculators Bearish Towards Copper

by Dan Norcini
Trader Dan Norcini

Here is a look at the current ( as of this Friday ) positioning of the players in the copper market. As the regular reader will already know, I pay very close attention to two key markets – Copper and Crude Oil, when trying to ascertain what the sentiment is of investors/traders towards overall economic growth.
[...] I recently posted a chart detailing the performance of the S&P 500 versus the Goldman Sachs Commodity Index showing the vast underperformance of the commodity sector against equities in general. My conclusion, based on that chart, was that global growth was mediocre at best and that stock market strength is more a function of Yield Chasing by speculative forces in a near Zero interest rate environment rather than evidence of a robust growing economy.
Continue Reading at TraderDanNorcini.Blogspot.ca…
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World To Enter Second Terrifying 2008-Style Global Meltdown


kingworldnews.com / September 12, 2014
Today King World News is featuring a piece by a man whose recently released masterpiece has been praised around the world, and also recognized as some of the most unique work in the gold market.  Below is the latest exclusive KWN piece by Ronald-Peter Stoferle of Incrementum AG out of Liechtenstein.
By Ronald-Peter Stoferle, Incrementum AG Liechtenstein
September 12 (King World News) – World To Enter Second Terrifying 2008-Style Global Meltdown
STAGFLATION ahead?
The following illustration places the current economic situation in an inflation matrix and explicates possible developments. It shows possible scenarios based on different growth and inflation rates.
READ MORE
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Rates Rise By The Tiniest Amount, And This Happens...

Day after day we are told, just wait for rates to rise ("which they 'have' to because economic growth is so strong") and stocks will take off into the next leg of exuberance... why else would the Fed end QE and start more hawkish discussions? (aside from the fact they truly fear broken repo, exuberant markets, and lethargic politicians). Be careful what you wish for... Mortgage rates rose last week, back to the same level they have been at for 3-months, and refinancing activity (adjusted for holidays) collapsed to its lowest since 2008... and home purchase activity tumble back towards 20-year lows.
Rates up... mortgage activity collapses...


to its worst since 2008...


Furthermore, despite record highs in US equity prices - which must mean the economy and confidence is soaring, right? Home purchase activity plunged back to near 20-year lows...


Does this in any way look like a recovering housing market?
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Friday, September 12, 2014

Sentiment Shifting for Gold Bugs

From a post on the HUI at the site last week:
"There are worse things that could happen than filling a gap and scattering the wrong kind of gold bugs back out. Then it would be up to the longer-term charts to do the heavy lifting if the daily does fulfill this downside potential."
The gap was filled, the top end of the anticipated support zone was reached and indeed, the wrong [i.e. momentum players] kind of gold bugs are scattering back out. The hard sell down on Thursday was very likely due in large part to the selling by traders with a fetish about gold as a geopolitical or terror hedge.
We should continue to tune out these people and while we are at it, tune out the 'Indian wedding season' and 'China demand' pumpers in favor of real fundamentals like gold's relationship to commodities and the stock market, the Banking sector's relationship to the broad market, Junk Bond to Quality credit spreads and US Treasury bond yield relationships.  (more)

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The Downside Target in Silver is Below $15

One of the scariest looking charts in the world today has to be Silver. The other popular precious metal, Gold, is looking pretty terrible itself, as we mentioned on Wednesday. But it doesn’t get worse than Silver. I first brought up this bearish development a month ago, but since then the scenario has actually worsened. Let’s get right into it.

Here is a weekly bar chart of Silver going back to the rally that got going towards the end of 2010 that took silver close to $50/oz. There are a few things that I want to point out here. First of all, notice how many times Silver has tested this support just below $19.

This area is key because not only was this former resistance in 2010 but it also represents the 161.8% Fibonacci extension from the early 2012 counter trend rally, which was the biggest one before the eventual breakdown last year:

ASC 9-11-2014 SI weekly bars
The more times that a level is tested, the higher the likelihood that it is going to break. After this many tests of support, my experience tells me that a big break is likely coming soon. To come up with a downside target we want to take the 161.8% Fibonacci extension from the size of the recent consolidation. In this case, the base of the descending triangle from the 2013 June-August rally gives us a target of $13.75. There is also some support around $14.80 from prior support in early 2010 as well as a measured move target based on the size of the last two bounces in Silver that took place throughout 2014.

We want to see new weekly closes in this market below all prior weekly closes in order to confirm this breakdown. So far the closing lows during this consolidation are 18.85 from July 2013 and $18.80 this May. We want to be short, but only below those levels. I believe there is enough downside here to justify the risk, as far as our risk tolerance and time horizon is concerned. For a catalyst, sentiment was much more bearish on the first 3 tests of support than there is now. Crashes don’t come when everyone expects them. In this case, fewer market participants expect one. We love that.
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Emerging Markets Soon to Breakout?

Tiho Brkan of TheDailyGold.com takes a technical look at how emerging market equities have been performing and whether now is the time for global fund managers and asset allocators to shift capital from expensive Developed Market equities towards laggards.
Chart 1: Could emerging market equities break out in coming quarters?

Source: Short Side of Long


Emerging Market equities have under performed Developed Market equities for years now. Slowing economic activity, falling export growth, over-leverage, inflationary pressures, and geopolitical tensions have plagued various regions and countries within the index. Since early 2010, the MSCI Emerging Market index has basically gone sideways while US equities have risen to record highs and become extremely expensive on historical basis.
Chart 2: Emerging Asia equities have already broken out to the upside.

Source: Short Side of Long


The question now is, could global fund managers and asset allocators shift capital from expensive DM equities towards laggards? GEM equities have now approached a major resistance zone, after making no progress since at least 2007. It seems that a breakout could be at hand in coming quarters, especially since Asia is already leading the way higher.
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Skyworks Solutions Inc (NASDAQ: SWKS)

Skyworks Solutions, Inc., together with its subsidiaries, provides analog semiconductors worldwide. Its product portfolio includes amplifiers, attenuators, battery chargers, circulators, DC/DC converters, demodulators, detectors, diodes, directional couplers, front-end modules, hybrids, infrastructure radio frequency subsystems, isolators, LED drivers, mixers, modulators, optocouplers, optoisolators, phase shifters, phase locked loops/synthesizers/VCOs, power dividers/combiners, power management devices, receivers, switches, voltage regulators, and technical ceramics. The company also offers MIS silicon chip capacitors and transceivers. It provides products for supporting automotive, broadband, cellular infrastructure, energy management, GPS, industrial, medical, military, wireless networking, smartphone, and tablet applications.
Take a look at the 1-year chart of SWKS (Nasdaq: SWKS) below with my added notations:
1-year chart of SWKS (Nasdaq: SWKS)
SWKS has been trending solidly higher since its bottom in late October. Starting in April, the stock has commonly found support on the increments of $5 (blue). For example, $35 acted as support in March. Then, $40 was support in April and May. There was support at $45 in June, and $50 in July. So, identifying this tendency should help when it comes to identifying when to enter a trade on SKWS.

The Tale of the Tape: SWKS is currently trading above the $55 level. A long position could be entered at $55 or on a break above $60 with a stop placed below the level of entry. If SWKS breaks below $55, another long play could be made at $50.
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USDA report sends Grains Reeling

Talk about a bearish set of reports! Most everyone was expecting the numbers to be on the bearish side as reports from private firms have been indicating crops in incredible shape with the potential for strong yields picking up with the passing of each month. USDA tends to be a bit conservative however and that had most in the trade expecting them to confirm higher yields but to wait for their October report before getting too optimistic.

Boy howdy was that NOT the case!

In the case of soybeans, USDA left both planted and harvested acreage unchanged from their August report (84.8 million and 84.1 million respectively) but it was the big jump in yields that caught many off guard. They found another 1.2 bushels per acre of yield from the August number of 45.4 to an astounding 46.6!

The result – a massive crop of 3.913 billion bushels, well up from last months 3.816 billion. Combine that with imports of 15 million bushels and the total supply jumped to 4.058 billion bushels of beans. I am still reeling when looking at that number!
READ MORE
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Thursday, September 11, 2014

Unleaded Gasoline notches 10 month low


The chart says it all - it is wonderful seeing some further relief at the gasoline pump!




Meanwhile, the general weakness in the overall commodity index continues with the Goldman Sachs Commodity Index registering a fresh 27 month low in today's session.  (more)Please share this article

Top-Rated Dividends Be a Millionaire in 20 Years

The secret to getting rich in the stock market isn't really a secret at all. In fact, it's so obvious and boring that most investors simply ignore it.
But frankly, if you think getting regular cash deposits into your brokerage account is boring, well, I'm not sure I can help...
Dividends paid to investors by U.S. companies account for 74% of stock market wealth. I didn't make that up — research by Robert Arnott and others shows it's true.
Here's a nice graphic from Ned Davis Research that shows the wealth-building power of dividends:
power dividend
Pretty much any category of dividend-paying stock trounces the non-dividend stock. And really, the difference in return on dividend and non-dividend stocks is stunning... $100 in a non-dividend stock would have returned 82% since 1972.  (more)
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Visa in the Middle of a Massive Consolidation

While breaking down each of the 30 Dow components earlier this week, I noticed something interesting taking place in shares Visa. Prices are currently right in the middle of a giant symmetrical triangle that’s been taking shape throughout 2014. The key here is that with prices currently above upward sloping 50 and 200 day moving averages, the bigger overall trend here is clearly up. Therefore, the resolution out of this consolidation is likely to be to the upside.
Here is a daily bar chart of $V in the middle of this pattern well-defined by these two converging trend lines. As prices approach the apex of this symmetrical triangle, something’s gotta give. A resolution is quickly approaching:
9-10-2014 V daily
From a risk management perspective, if prices break below the June lows near $207, then this bullish thesis is likely incorrect and a more bearish stance would be more appropriate. Although I believe this is the lower probability outcome, keeping an open mind to all possibilities is something that we pride ourselves on.
I would also argue that a rally above the July highs near $225 would confirm a breakout and bullish resolution to this pattern that would signal much higher prices in the near future. I think this is the higher probability going forward based on the evidence above along with momentum readings and longer-term time frame analysis.
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