Thursday, October 31, 2013

Jim Sinclair: Gold Will be $50,000 per Ounce, Gold Confiscation, Dollar Gets Hammered and More

According to Jim Sinclair of, by 2016, "Gold will be $3,200 to $3,500 an ounce." By 2020,
Sinclair predicts, "Emancipated gold will be $50,000 per ounce." As far as gold confiscation goes, Sinclair says that Its not going to happen, but a windfall tax could definitely be in the cards. Join Greg Hunter as he goes One-on-One with renowned gold expert Jim Sinclair.
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Toll Brothers Inc (NYSE: TOL)

Toll Brothers, Inc., together with its subsidiaries, designs, builds, markets, and arranges finance for detached and attached homes in luxury residential communities. It is also involved in building or converting existing rental apartment buildings into high-, mid-, and low-rise luxury homes. In addition, the company, through joint ventures, is developing a high-rise luxury condominium/hotel project and a for-rent luxury apartment complex. Further, it owns, develops, and operates golf courses and country clubs associated with various planned communities. The company serves move-up, empty-nester, active-adult, age-qualified, and second-home buyers in 19 states in the United States. Toll Brothers, Inc. was founded in 1967 and is headquartered in Horsham, Pennsylvania.
To review Toll's stock, please take a look at the 1-year chart of TOL (Toll Brothers, Inc.) below with my added notations:
1-year chart of TOL (Toll Brothers, Inc.) TOL has been trading mostly sideways for the last 5 months. Over that period of time, the stock has formed an obvious resistance level at $35 (blue). In addition, the stock has also created a strong level of support at $30 (red) that has held ever since mid-August, for the most part. At some point the stock will have to break one of those two levels.

The Tale of the Tape: TOL has identifiable levels of support and resistance. The possible long positions on the stock would be either on a pullback to $30, or on a breakout above $35. The ideal short opportunities would be on a break below $30 or on a rally up to $35.
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Kyle Bass: The Fed Has Made “Stocks Only Game In Town” So The “Rich Will Get Richer”

Having previously exposed the world to the “nominal stock market cheerleaders,” it is clear that Kyle Bass sees things as only having got worse among developed nations. In fact, the following interview shows that he does not fear US losing its credibility since “developed western economies with the largest debt loads are all in the same boat.” The discussion expands from the debt ceiling debacle to bonds and stocks, “given the lack of nominal yield in the bond market, all of the new money is going to continue into stocks. The interesting thing is it’s going to make the rich people richer and the middle and lower class won’t be any better off, which is the opposite of what the administration is trying to pull off,” adding that being in stocks “is not your choice,” thanks to Fed repression and that deficit contraction is all that can stop the Fed now.
As Bass warned previously,
he caveats that nominally bullish statement with a critical point, “Zimbabwe’s stock market was the best performer this decade – but your entire portfolio now buys you 3 eggs” as purchasing power is crushed. Investors, he says, are “too focused on nominal prices” as the rate of growth of the monetary base is destroying true wealth.  (more)
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McAlvany Weekly Commentary

Bill King: “Buy Real Things”

About this week’s show:
-Fed is causing deflation by killing income
-Tapering is now off the table
-Real assets provide quiet wealth
About the guest: Market Strategist, Bill King, has authored “The King Report” for over 18 years. It is an independent view on global, political, financial, and economic factors that influence world markets. As author of the firm’s daily market commentary, Bill’s candid observations and forecast on the economic, financial, and political forces that are impacting the markets have been extremely accurate.

Read | Subscribe@iTunes
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China Is Preparing To Declare Financial War Against The US / October 30, 2013
Today acclaimed money manager Stephen Leeb stunned King World News when he warned that the Chinese were preparing to declare financial “war” against the United States.  Leeb also discussed the frightening implications of this for the United States as well as other Western nations in this powerful interview.
Leeb:  “People don’t completely understand this because the stock market is on the move, but the reality is that  the US is in a great deal of danger.  There is a ‘black swan’ out there than could very easily destroy the US dollar and collapse the United States….
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Some Very Interesting Charts

The first one is the current decade breakout in $SPX compared to the one in 1980. As excited as many people get about this breakout, notice how one more pullback was needed before the eventual 1982 low in the market:
10-30-13 spx 60s and today
The next one shows the Small-cap Russell2000 vs the Dow Jones Industrial Average breaking out of a monster base. Isn’t this beautiful?
10-30-13 iwm vs dow
We’ve all heard about how great healthcare has done this year, and more specifically biotechnology. Jonathan took this a step further and plotted the Top 15 names in the S&P Healthcare Index minus the biotech names. Look at the difference in the two charts. I think there’s a mean reversion play here:
 10-30-13 biotech
Everyone I speak to these days is bullish Japanese stocks. Do you know anyone who isn’t? It’s almost an insult to someone if I come up with a counter-argument. Well, here is a chart of the Nikkei running into a mufti-decade downtrend line, as well as the exact measured move from the 5500 point consolidation before last year’s monster breakout:
10-30-13 nikkei
And while we’re on the Japan topic, here is the highly correlated Dollar/Yen cross. And like the Nikkei, we’re looking at a mufti-decade downtrend line as well as horizontal resistance:
10-30-13 usdjpy
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Wednesday, October 30, 2013

Dow Hits New All-Time High On Lowest Non-Holiday Volume Day Of The Year / by Tyler Durden
SSDD. Collapsing confidence, check. Housing Recovery meme toast, check. Volume at 2013 lows, check. BTFATH and send Trannies up for 13th of last 15 days (+10.4%), Dow near all-time highs again (thank you IBM buybacks), and S&P to new all-time highs… but don’t tell Treasuries (which stand +/-1bps on the week). VIX wasn’t drinking the kool-aid but the NASDARK session enabled futures to drag us back to higher before limping lower into the closer. The USD oscilatted around Nowotny comments and POMO ending the day up a rather notable 0.5% from Friday’s close and that pressured commodities in general lower (gold hovering at $1345). The last 2 minutes saw stocks scream higher on their own as the world was terrified it would miss out on something (but no other market moved) and all the major indices managed new highs.
US Equity markets have only one master… JPY carry levered muppetry…
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Should We Trust this Breakout in the Euro?

The Euro has had quite a run since the lows in early July. Versus the US Dollar, we’ve seen $EURUSD up from 127 to 138 pretty quickly. But here is where it gets interesting: Last week, the Euro took out its February 1st highs. If you recall, this was the Friday right before the Super Bowl. That Sunday night, while the lights in the Superdome went out, stopping play, emerging markets and Europe were beginning their massive sell-offs. By Monday morning, anything in the Eurozone was down 5-6%; it didn’t matter whether it was Germany or Italy – the selling was everywhere. Obviously, with their highly correlated nature, the Euro currency got just as destroyed as the equities.
So here we are deliberating whether or not to trust this “breakout” in Euro to new 52-week highs. I’ll present the data, and then you decide. First the chart. This is the Euro Currency Shares ETF daily bars $FXE (although $EURUSD looks exactly the same):
10-29-13 fxe
All I have to say is that these new highs better hold…or else….
Next is the sentiment data. This chart is based on a basket of well-established surveys. They include but are not limited to Consensus Inc, Daily Sentiment Index, Bloomberg, Ned Davis, etc. The Bands represent 1.5 standard deviations from a one-year moving average. Look how far above normal bullish consensus is right now for the Euro:
10-29-13 public opinions
And finally here is the most recent Commitment of Traders Report. The green line at the top shows the Commercial Hedgers, or “smart money”, dumping this currency as fast as possible. Meanwhile, the speculators both large and small, or “the dumb money”, appear to be buying fairly aggressively up here.
10-29-13 consensus
So you tell me: Is it time to be buying the Euro? Or selling it?
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5 Bargain Stocks to Buy for Under $10: WEN, SIRI, GGB, DHX, ELI

In this frothy stock market, it’s easy to find stocks that continue to move to new highs.
But for investors looking for picks that are affordable at less than $10 a share, it’s getting increasingly difficult to find cheap stocks worth owning.
Sure, there are some battered players out there on the cheap like JCPenney (JCP) … but buying a cheap stock like JCP that is circling the drain is not the same as buying a low-priced company at a bargain.
If you’re looking for cheap stocks to buy now for under $10, here’s a list of five players to consider in the months ahead.


Burger chain Wendy’s (WEN) has soared almost 60% so far in 2012, but remains under $10 a share and is still a decent buy for investors looking at low-priced options right now.
Wendy’s has had a rough go of things in recent years, but after the 2011 sale of its Arby’s restaurants to a private equity group the burger chain has been able to stay focused and worry about efficiency and modest international investment. Wendy’s re-entered Japan in 2012 and that same year managed to topple Burger King (BKW) as the No. 2 burger chain in America behind McDonald’s (MCD).  (more)

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Facebook (FB) is Doomed: Forrester Says Ads Tell a Sad Story

Forrester, the respected market research group, has just published a brutal report on Facebook (FB) based on a survey of 395 marketing executives. The conclusion: "Facebook creates less business value than any other digital marketing opportunity ... [so] ... Don’t dedicate a paid ad budget for Facebook."
Facebook responded that the report was "illogical and ... irresponsible."
The research company published a blog post discussing the report here. But we've seen the full report, and it's grim reading for Facebook. The social network ranked last among a range of online tactics that 395 executives were asked to choose from:
Forrester Analyst Nate Elliott concludes:
Facebook creates less business value than any other digital marketing opportunity. We asked 395 executives from the US, the UK, and Canada how satisfied they were with the business value they get from 13 different online marketing sites and tactics. You’d expect a site boasting the largest audience and the biggest collection of data to fare well. But we found that Facebook offered less value than anything else on our list .... The least valuable tactic within Facebook? Those paid ads onto which Facebook has shifted focus. (more)
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Atwood Oceanics, Inc. (NYSE: ATW)

Atwood Oceanics, Inc., an offshore drilling contractor, engages in the drilling and completion of exploratory and developmental oil and gas wells. The company owns a fleet of approximately 11 mobile offshore drilling units primarily located in the United States, Gulf of Mexico, the Mediterranean Sea, offshore West Africa, offshore southeast Asia, and offshore Australia. It also has three ultra-deepwater drill ships, and two high-specification jack ups under construction. The company was founded in 1968 and is headquartered in Houston, Texas.
To review Atwood's stock, please take a look at the 1-year chart of ATW (Atwood Oceanics, Inc.) below with my added notations:
1-year chart of ATW (Atwood Oceanics, Inc.) ATW has formed a key level of support at $54 (blue) over the last (3) months. In addition, the stock has created a trendline of resistance (red) starting in the beginning of August. These two levels combined have ATW stuck within a common chart pattern known as a descending triangle. At some point, the stock has to break through one of those two levels.

The Tale of the Tape: ATW has formed a descending triangle. A short trade could be made on a break of the $54 support. A break through the downtrending resistance level, which currently sits near $56, would set up a potential long trade.
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Tuesday, October 29, 2013

Caterpillar (NYSE: CAT): Appears Headed for Bear Market Territory -- Sell Now

When you think of stalwart mega-cap industrial stocks, Caterpillar (NYSE: CAT) certainly is one that comes to mind. The earth-moving equipment blue chip, Dow component, and long-time bellwether for the global economy, has been a big winner for investors and traders over the years, and for good reason.

During the past decade, there's been a huge infrastructure buildup in the emerging markets of Asia, especially China, and Russia, India and Brazil. The massive demand for heavy-duty construction equipment has made the iconic brand a mainstay on big building projects in nearly every corner of the globe.

Recently, however, demand for Caterpillar's products has waned, and that's caused a marked slowdown in the company's earnings growth, as well as a significant decline in CAT shares. (more)

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Six Flags Entertainment Corp (NYSE: SIX)

Six Flags Entertainment Corporation owns and operates regional theme, water, and zoological parks. The company's parks offer various state-of-the-art and traditional thrill rides, water attractions, themed areas, concerts and shows, restaurants, game venues, and retail outlets. It owns and operates approximately 18 parks, including 16 parks in the United States; 1 park in Mexico City, Mexico; and 1 park in Montreal, Canada. The company was formerly known as Six Flags, Inc. and changed its name to Six Flags Entertainment Corporation in April 2010. Six Flags Entertainment Corporation was founded in 1971 and is based in Grand Prairie, Texas.
To review Six Flag's stock, please take a look at the 1-year chart of SIX (Six Flags Entertainment Corporation) below with my added notations:
1-year chart of SIX (Six Flags Entertainment Corporation) SIX has formed a very clear down-channel chart pattern over the last (6) months. A channel is simply formed through the combination of a trend line support that runs parallel to a trend line resistance. When it comes to channels, remember that any (3) points can start the channel, but a 4th point or more confirms it. You can see that SIX has several points of channel resistance (red) and support (blue). Following the SIX channel can provide you with both long and short trading opportunities.

The Tale of the Tape: SIX has formed a common pattern know as a channel, in this case, a down channel. A long trade can be entered on a pullback to the channel support, which at this point is near $31.50, or on a breakout through the channel resistance, currently sitting near $35. Short trades could also be placed at channel resistance or if SIX were to break below the channel support.
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Historic End Game – “A Collapse To End All Collapses”

from KingWorldNews:
The West is headed into a historic collapse, and we have all of this misinformation in the mainstream media which is designed to fool people. We are in the middle of the biggest financial bubble in the history of mankind. The Fed and the Bank of Japan are combining for over $150 billion of QE each month. Mario Draghi, head of the ECB has already come out and said they will backstop all European debt.
The Chinese are reigniting their bubble because they saw the pain that was created by even the slightest tapering in their monetary stimulus. So, the fact that the mainstream media claims nothing really bad has happened so far is only testimony to the fact that they are throwing all caution to the wind and pumping all the money they can into the system because we are now in a historic end game. We are either going to have a collapse to end all collapses, or we are going to have hyperinflation.
John Embry continues @
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Why the Threat of Recession Keeps Robert Shiller Up At Night (Video)

by Lauren Lyster
Yahoo! Finance

American economist Robert Shiller may be a winner of the 2013 Nobel Prize in economic sciences for his research into market prices and asset bubbles, but when The Daily Ticker caught up with him, he wasn’t particularly concerned about current market prices or asset bubbles.
So what keeps the Yale professor and S&P/Case-Shiller Home Price Index co-founder up at night?
“The world economy is softening a bit,” he tells us in the accompanying interview. “There’s always a chance of another recession. It’s been six years since the last recession started – they tend to come along with some regularity. Congress is now unable to get things done, and so we won’t have a good response if there’s another recession.”
Continue Reading at…
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Gerald Celente ~ Total Economic Collapse in Q1 2014

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CalAmp (NASDAQ: CAMP): This Triple-Digit Gainer Could Surge Another 85%

Impressed by the performance of the S&P 500 so far this October? You should be. The index is trading near its all-time high of 1,759, and it is up about 4.3% since Oct. 1.

Despite the phenomenal gains of the past month, the performance of the S&P seems almost tepid compared to wireless communications provider, CalAmp (NASDAQ: CAMP). The company, which develops wireless datacom and satellite communications solutions, is up almost 40% so far this month. Even more impressive, shares have increased more than 190% year to date, surging from around $8 at the end of 2012 to their current level above $24.

The stock's enormous returns have been fueled by eye-popping revenue gains. In its recently reported fiscal 2014 second-quarter results, the company posted a 38% year-over-year revenue increase in its wireless datacom segment. This increase was driven largely by the company's mobile resource management products, including its stolen vehicle recovery system and GPS-enabled fleet management devices. Growth was also seen in the company's wireless network division, which enables everything from automating electricity distribution to facilitating communication among emergency vehicles.  (more)

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Monday, October 28, 2013

TD Ameritrade Holding Corp. (NYSE: AMTD)

TD Ameritrade Holding Corporation provides securities brokerage services and technology-based financial services to retail investors, traders, and independent registered investment advisors (RIAs) in the United States. The company's offerings include TD Ameritrade for self-directed retail investors; TD Ameritrade Institutional, which provides brokerage and custody services to independent RIAs and their clients; thinkorswim that offers a suite of trading platforms serving self-directed and institutional traders, and money managers; and Investools, a suite of investor education products and services for stock, option, foreign exchange, futures, mutual fund, and fixed-income investors; Amerivest, an online advisory service that develops portfolios of exchange-traded funds for long-term investors. It also offers products and services, such as common and preferred stocks, exchange-traded funds, options, futures, foreign exchange products, mutual funds, fixed income products, primary and secondary fixed income securities, closed-end funds, and preferred stocks, as well as margin lending, cash management services, and annuities.
To review TD's stock, please take a look at the 1-year chart of AMTD (TD Ameritrade Holding Corporation) below with my added notations:
1-year chart of AMTD (TD Ameritrade Holding Corporation) AMTD has been trading mostly sideways for the last 3 months. Over that period of time, the stock has formed an obvious resistance level at $28 (red), and in addition, the stock has also created a strong level of support at $25.50 (green). At some point the stock will have to break one of those two levels.

The Tale of the Tape: AMTD has identifiable levels of support and resistance. The possible long positions on the stock would be either on a pullback to $25.50, or on a breakout above $28. The ideal short opportunities would be on a break below $25.50.
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HCP (NYSE: HCP) This High-Yielding REIT Could Return Double-Digit Profits by Thanksgiving

With the recent decline in interest rates thanks to a strong bond market, dividend stocks are back in favor. Sectors that do well when bonds rally are setting up for a nice move higher.

HCP (NYSE: HCP) is a real estate investment trust (REIT) that owns and manages health care properties. I am not big on trying to figure out what stocks will do well under the Affordable Care Act (Obamacare), but rather look for stocks with charts that signal they are ready to go higher. With a generous 4.9% dividend yield and improving technical indicators, HCP is indeed set up for price gains.

As a group, stocks offering big dividends peaked in May when the bond market began to fall. At the time, the Fed first hinted that it was considering the tapering of its bond buying program. Utilities, REITs, housing and many consumer staples stocks headed lower as traders thought interest rates would rise. (more)

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US Stock Market -The Great American Wall Of Worry

Traders and investors all around the world is having trouble climbing over the wall of worry/fear with the US stock market, and rightly so. There is a lot of things taking place and unfolding that carry a high level of uncertainty. Let’s face it, who wants to invest money into the market when it’s hard to come by (high unemployment, banks are still extremely tight with their money, companies are nowhere near wanting to hiring new staff).
The hard pill to swallow is the fact that the stock market loves to rise when uncertainty is high. It’s almost doing it just to drive investor’s nuts who sold out near market bottom or recent correction. You must overcome the urge to short the market when the economy looks so bearish in the years ahead, and continue to trade with the trend.

Short Term Investing – Weekly Volatility Index Chart

Below you can see the fear index. The chart is self-explanatory showing where it should move next. But if you are not familiar with the VIX then here is definition by investopedia:
“The first VIX, introduced by the CBOE in 1993, was a weighted measure of the implied volatility of eight S&P 100 at-the-money put and call options. Ten years later, it expanded to use options based on a broader index, the S&P 500, which allows for a more accurate view of investors’ expectations on future market volatility. VIX values greater than 30 are generally associated with a large amount of volatility as a result of investor fear or uncertainty, while values below 20 generally correspond to less stressful, even complacent, times in the markets.”

Weekly Investing Chart of the SP500 Index

After reviewing the VIX chart above which points to stocks nearing a level of selling pressure, then review the chart below we come to a conclusion that a minor pullback of 2-5% is likely to take place in the next week ortwo.
The divergence in the Relative Strength Index is a bearish sign for the broad market. While I feel a pullback is do and needed for the market to regroup, it is important to review the seasonality chart and know that we are entering one the strongest times of the year for stocks.

SP500 Seasonality Chart

Again, using the data from the previous two charts along with this graph clearly shows that a pullback in the stocks is likely going to be bought back up by the brave investors willing to override their fear and go with the trend. For more interesting charts check out my stock chartlists:

The Wall Of Worry Conclusion:

In short, expect the stock market to correct in the next week or two. But once we get a correction of two percent or more, be prepared for buyers to step back in and buy things up into year end.
This WALL OF WORRY is about to GET HIGHER!
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How the Government Borrows Money

There’s been a lot of unnecessary political drama over the past few weeks, notably the big issues with the debt ceiling and government shutdown. This put many investors – including technical traders and analysts – on edge and on the sidelines.
But as I clearly stated in my last few letters – unless you’re an American government employee – none of this should’ve worried you; the markets would likely move higher:
“With the amount of money in deposits growing at the banks and being used as collateral for big stock market bets, the markets could continue to move higher this year.”
Of course, a U.S. default would’ve been disastrous; more so for what America represents, rather than the actual outcome of a short-term default. One default in a set of bonds doesn’t directly affect other bonds, but would cause lending rates to skyrocket. The domino effect of this would’ve been very bad. (more)

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Housing Market Update – Pulte Home’s Misleading Earnings – Short Homebuilders On Every Bounce / BY DAVE IN DENVER / FRIDAY, OCTOBER 25, 2013
The housing market bulls never cease to amaze me.  Pulte Homes pulled a brazen earnings management stunt in their Q3 earnings reported yesterday and now I’ve got some former Big-4 accounting firm audit geek harassing me about my interpretation of accounting guidlines.  It’s hilarious.  I couldn’t resist but point out that it’s the big accounting firms that tend to go under after they’ve been prosecuted and found guilty for aiding and abetting accounting fraud.  Anyone remember Enron?  That’s why what used to be the Big 8 is now the Big 4.  In order to prevent further embarrassment to the highly paid regulators who are supposed to oversee the accounting standards being applied, the FASB and the SEC just made the accounting rules and standards significantly more liberal and  more open for a very wide range of “opinion.”
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US Weekly Economic Calendar

time (et) report period Actual CONSENSUS
9:15 am Industrial production Sept.   0.4% 0.4%
9:15 am Capacity utilization Sept.   78.0% 77.8%
8:30 am Producer price index Sept.   0.3% 0.3%
8:30 am Core PPI Sept.   0.1% 0.0%
8:30 am Retail sales Sept.   0.0% 0.2%
8:30 am Retail sales ex-autos Sept.   0.4% 0.1%
9 am Case-Shiller home price index Aug.   -- 12.6% y-o-y
10 am Consumer confidence index Oct.   75.0 79.7
10 am Business inventories Aug.   0.4% 0.4%
8:15 am ADP employment Oct.   145,000 166,000
8:30 am Consumer price index Sept.   0.2% 0.1%
8:30 am Core CPI Sept.   0.2% 0.1%
2 pm FOMC statement        
8:30 am Weekly jobless claims 10/26
N/A 350,000
9:45 am Chicago PMI Oct.   54.5 55.7
Nonfarm payrolls report for Oct. will be released on Nov. 8
8:58 am Markit PMI Oct.   -- 52.8
10 am ISM Oct.   55.0% 56.2%
TBA Motor vehicle sales Oct.   15.4 mln 15.2 mln
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Saturday, October 26, 2013

The 3 Most Valuable Traits Of Any Winning Stock

I probably don't have to tell you this, but the odds are stacked against you when it comes to "beating the market."
By nearly 6 to 1 in fact...
Investment analysts, advisors and fund managers -- the so-called experts -- spend their entire working lives and billions of dollars on research vowing to "beat the market" in any given year -- yet the vast majority of them fail...
Just look at mutual fund industry's record. In the past three years, just 14% of actively-managed mutual fund managers matched or exceeded the market's performance according to Standard & Poor's.  (more)

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The End Of US Dollar As World’s Currency Predicted by Canadian Millionaire

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The Last Time “This” Happened, Stocks Fell 15% / by Tyler Durden
As we head into the vinegar strokes of 2013 with the world awash with liquidity and ever ready to BTFATH, we note that the last time the S&P 500 saw two consecutive years when the index did not go negative year-to-date was 1975-1976. As Bloomberg notes, just as in 2012 and 2013, we have not seen one day close below the previous year’s closing level but as Marketfield’s Michael Shaoul comments “eventually circumstances will change sufficiently to make the equity market a treacherous place,” and if history is any guide, just as 1977 saw stocks drop 15%, then 2014 may reacquant investorsd with what “risk” and “volatility” means in US equities.
Of course, a 15% drop in today’s environment would be crushing… with margin at record levels and the world rehypothecated to the nth extreme…
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Precious Metals: Gold, Silver and Miners Are Trapped

Gold Spot Price – Weekly Chart

This chart clearly shows the trends which gold has gone through in the last three years. With simple technical analysis trend lines, clearly price is nearing a significant apex which will result in a strong breakout in either direction.
Remember, this is the weekly chart, so we could still have another month or three of sideways chatter to work through. But a breakout in either direction will trigger a large move.

Silver Spot Price – Weekly Chart

Silver is also stuck in a similar pattern.  Currently the odds still favors lower prices and for the upper resistance trend line to reject price and send it lower. But if we keep out eye on the leading indicators like gold miners, we may be able to catch a breakout or traded the rejection of resistance in the next month or so.

Gold Mining Stock ETF – Monthly Chart

Gold miners have a very sloppy looking chart. Price is extremely volatile and the recent price action in 2013 could go either way VERY quickly. I have a gut feeling GDX in the coming months could have a washout bottom and tag the $20 price level. While I hope I am wrong for many investors sake, if it does happen, it will be a very strong investment level to accumulate a position.

Precious Metals Bigger Picture Outlook:

In short, I remain neutral – bearish for this sector.  In the next 1-3 months we are likely to see some strong price action which will be great. We need a breakout or bottoming pattern to form before we get involved at this level.
I know everyone is dying to get involved in precious metals again for another huge rally… but sometimes it’s just best to wait for the big picture chart to catch up with your bias before taking a position of size.
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Dollar’s Breakdown, Stocks’ Breakout and Implications for Gold

After 12 years of gains, gold has fallen nearly 20% this year. The price of gold has been pressured for much of this year by the view that the Fed would end its stimulus program soon because of strength in the U.S. economy. However, some recent (weaker than expected) economic data, along with the 16-day U.S. government shutdown, have suggested that the central bank may keep its bond purchase in place for longer and increased gold’s safe-haven appeal.

What impact did these circumstances have on the yellow metal?

In less than two weeks, gold has rallied 8% (nearly $100 an ounce) and it seems that the shiny metal will end higher for a second straight week.

On Thursday, the price of gold climbed to a one-month high after preliminary data showed that U.S. manufacturing activity fell to a 12-month low of 51.1 in October from a reading of 52.8 in September. Additionally analysts had expected U.S. jobless claims to fall by 22,000 to 340,000 last week. Meanwhile, a separate report from the U.S. Department of Labor showed that the number of individuals filing for initial jobless benefits declined by 12,000 last week to a seasonally adjusted 350,000. The above (weaker than expected) numbers raised expectations for continued easy-money policies from the Federal Reserve.

Taking into account the fact that yesterday gold reached its highest level since Sept. 20., the big question is: will it keep rallying?

Today, we’ll examine the US Dollar Index from many perspectives and take a look at the long-term S&P 500 chart to see if there’s anything on the horizon that could drive gold prices higher or lower in the near future. We’ll start with the long-term USD Index chart (charts courtesy by
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The Boom and Bust Cycle

As is clear to all with half a brain the production of un-backed fiat money distorts the economic system. Simply told, when an entity in society is given monopoly to manufacture medium of exchange at its own discretion they will harness this power. Slowly at first, unsure about its effects, but always testing the limits of the privilege bestowed upon them.

As always, they will overexploit the power. They will manufacture money and give it to the masters that coercively secure the continuation of the power. The masters will obviously spend the money, creating a transaction in which nothing is payment for something. These transactions are by definition unsustainable because they violates Say`s law. We call them “bubbles”

In a free market supply is used to create its own demand. When people spend fiat money they exercise demand without providing supply. Said in other words, spending fiat money is tantamount to capital consumption and makes society poorer.  (more)

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Lindsey Williams ~ 3 Things Will Happen Before The Financial Collapse Takes Place!!

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Friday, October 25, 2013

Apple AAPL: This Stock Should Double From Here

I have such an intense enthusiasm for Apple Inc. (Nasdaq: AAPL) that my collection of the company’s products sounds a lot like the lyrics of a famous Christmas song: five iPhones, four wireless routers, three MacBooks, two Apple TVs, and one pair of iPads.

And while my love for the company’s products is great, and would certainly be a factor, I can assure you that my analysis of the profit potential posed by Apple stock will be like any other recommendation I make – completely objective.

But with a polarizing “cult” stock like Apple, that’s clearly not a claim that every analyst can make.(more)

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Silver Stocks Could Shine Again Soon: PAAS, CDE. SSRI

I am somewhat amazed at what’s been going on in the market for the last week or so.
Of course, the gyrations of momentum traders are always something to behold. But when we look at stocks like Google (GOOG), we’ve seen tens of billions of dollars added to the market cap in just a very short time. There is simply no rational way to come up worth any reasonable, or even unreasonable, estimate of business value for either of GOOG stock.
It has been almost as silly in the other direction, too. Traders knocked billions off the market cap of Stanley Black & Decker (SWK) after the company actually reported a 44% improvement in earnings. And Teradata (TDC) saw its corporate value trimmed by something like $1.5 billion after the company lowered its forecast.
These wild swings in valuation have nothing to do with the worth of the company and are purely psychological in nature. (more)

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Intrexon (NYSE: XON): A Biotech Star’s Next Big Idea

That company, Intrexon (NYSE: XON), has been developing a set of tools that enable scientists to step inside the human gene and alter its basic structure. The company isn't concerned about coming up with a blockbuster drug. It wants to provide the tools for other biotech firms to make major breakthroughs. So what exactly is Intrexon looking to accomplish? The company is in the field of synthetic biology, which alters the core mechanisms of action taking place inside cell walls.

Make no mistake, this is an approach that will take time to pay off. Intrexon must sign partnerships that promise upfront licensing fees along with product-based royalties. In that respect, Intrexon is starting to gain steam:

-- In October 2012, Intrexon inked a deal with Fibrocell to supply the UltraVector platform to Fibrocell's dermatology and aesthetics products. (more)

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U.S. Bancorp (NYSE: USB)

U.S. Bancorp, a financial services holding company, provides a range of financial services in the United States. Its services include lending and depository services, cash management, capital market, and trust and investment management services. The company also engages in credit card services, merchant and ATM processing, mortgage banking, insurance, brokerage, and leasing. Its lending services include traditional credit products, as well as credit card services, leasing, financing and import/export trade, asset-backed lending, agricultural finance, and other products. The company's depository services comprise checking accounts, savings accounts, and time certificate contracts. It also offers ancillary services, such as capital market, treasury management, and receivable lock-box collection services to corporate customers; and a range of asset management and fiduciary services for individuals, estates, foundations, business corporations, and charitable organizations. In addition, the company provides Visa corporate and purchasing card services, and corporate trust services.
To review Bancorp's stock, please take a look at the 1-year chart of USB (U.S. Bancorp) below with my added notations:
1-year chart of USB (U.S. Bancorp) USB has been trading mostly sideways for the last 3 or 4 months. Over that period of time, the stock has formed a resistance area around $37.50 (red), In addition, the stock has also created a strong level of support at $35.50 (blue). At some point the stock will have to break one of those two levels.

The Tale of the Tape: USB has identifiable levels of support and resistance. The possible long positions on the stock would be either on a pullback to $35.50, or on a solid close above $37.50. The ideal short opportunities would be on a break below $35.50.
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“At A Record High Median Price To Sales Ratio” There Is “Nothing Worth Buying”

First on China:
Chinese policy makers are locked in the same old failed credit simulative policies as the west to keep growth going. Indeed, the Chinese GDP ship appears to be steaming ahead in Q3 at a very respectable 7.8% yoy rate. This is the big message the markets have consumed. But look at the ship closely from the front or rear and you can see the ship increasingly rocking violently from side to side while still making forward progress. And are those Chinese policy makers that can be seen manically running from one side in an attempt to keep the ship from foundering? This is a totally unsustainable situation in my view. But again, no-one is listening.
And next, the US:
Only the brave can react to what they see and leave the markets. The global macro looks an appalling mess and even more importantly, long-term equity investors can find nothing worth buying. For equity investors we are closer to 2007 than 2001 as the vast bulk of the equity market, as represented by the median PE, PB or Price/Sales, is expensive. The US median price/sales ratios is at a record high, indicating that there is practically nothing cheap in the equity market left to buy.
Dear Albert: our condolences; the reason no-one is listening is because a comic term we came up with, namely BT(M)FATH, has become a daily investment strategy. And as long as the Fed allows that kind of idiocy to continue, nobody will listen. Why should they?
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Alumina Ltd AWC: A $4 Stock Valued at $11

Another way to play aluminum might be through Alumina Ltd. (ADR) (NYSE: AWC).

Alumina owns 40% of the world's largest alumina business, Alcoa World Alumina and Chemicals (AWAC), with Alcoa owning and managing the other 60%.

AWAC mines and refines bauxite and produces and markets alumina to smelters around the world. It's also the world's largest producer of alumina. Interestingly, AWAC is a low-cost producer, with many operations in the lower-cost quartiles.

To be sure, Alumina Ltd. is a riskier play on the sector than Alcoa. But it trades at about $4.00 per share right now, below its book value of around $4.25 per share. And Morningstar's fair-value estimate is $11.  (more)

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Thursday, October 24, 2013

The Only Number You Need to Time – and Beat – the Market

It certainly seems as though the political gamesmanship that rules Washington, D.C., also rules the markets. But this isn't really the case.
In fact, there's one single "magic" number that far outweighs everything else when it comes to long-term influence.
This number's predictive power has saved me from some of the steepest market drops of the century, and it's given me everything I need to position myself for maximum gains in bull markets.
And the best part is, it's widely available - access to it costs nothing.
It's how you use this simple number that counts...(more)

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This 'Hated' Sector Offers Great Yields and Catalysts Galore:BBEP, LRE, QRE

When is the best time to focus on a particular industry? When it's deeply out of favor.
Every industry hits the occasional rough patch, which typically leads investors to focus their attention elsewhere. Yet when the rough patch ends, and the skies start to brighten, you have a chance to dig into the group before the crowd returns.

That's precisely the set up in place for a group of companies known as upstream MLPs. These master limited partnerships focus on mature energy fields. These firms don't focus on the early stage of energy exploration, and instead buy mature oil and gas fields that other firms have chosen to sell.

It's an industry known for a lot of deals, as the key players boost sales and replace existing assets that eventually start to post declining output. Nearly $2.5 billion in transactions were completed in 2010, rising to $5.8 billion in 2012, according to Credit Suisse. And investors were expecting even higher amounts of deal-making in 2013 -- until Linn Energy (Nasdaq: LINE) spoiled the party.  (more)

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McAlvany Weekly Commentary

Wise Investing Eliminates the Time Question

About this week’s show:
-Dollar velocity at six decade lows
-T-bonds vulnerable to announcement from China
-Who? What? Where? Why? Forget the when
Read | Subscribe@iTunes
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A Great Inflation Is Coming That Will “Shock The World”

from King World News
Today a man who has lived in 18 countries around the world, and witnessed collapses in many of these countries firsthand, told King World News that the globe is now beginning to see some major warning signs that indicate a “Great Inflation” is coming that will “shock the world.” Keith Barron, who consults with major companies around the world and is responsible for one of the largest gold discoveries in the last quarter century, also spoke about these incredible warning signs and what they mean for key markets such as gold.
Barron: “We are going to see destructive inflation creeping around everywhere. Household goods, groceries, medical costs, insurance, things like that are going to continue to surge in price. So, despite the propaganda, yes, inflation is happening in America and elsewhere….
Continue Reading at…
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BofAML Turns Bullish On Gold

BofAML’s MacNeil Curry is changing his view on gold from bearish to bullish. The impulsive gains from the 1251 low of Oct-15 and break of the two-month downtrend (confirmed on the break of 1330) tells him that a medium-term base and bullish turn is unfolding. BoFAML looks for an ultimate break of the 1433 highs of Aug-28, with potential for a push to 1500/1533 long term resistance. In the next several sessions Curry suggest buying dips into 1309, cautioning that this bullish view is “wrong” if gold breaks below 1251. For those awaiting additional confirmation of a turn, Curry notes you need to see a break of 1375 (Sep-19 high & right shoulder off a multi-month Head and Shoulders Top).
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Arthur J. Gallagher & Co. (NYSE: AJG)

Arthur J. Gallagher & Co. and its subsidiaries provide insurance brokerage and risk management services to various commercial, industrial, institutional, and governmental organizations. It operates in two segments, Brokerage and Risk Management. The Brokerage segment primarily consists of retail and wholesale brokerage operations. Its retail brokerage operations negotiate and place property/casualty, employer-provided health and welfare insurance, and retirement solutions primarily for middle-market commercial, industrial, public entity, religious, and not-for-profit entities.. The Risk Management segment offers contract claim settlement and administration services for enterprises that choose to self-insure some or all of their property/casualty coverages, and for insurance companies that choose to outsource some or all of their property/casualty claims departments.
To review Arthur's stock, please take a look at the 1-year chart of AJG (Arthur J. Gallagher & Co.) below with my added notations:

CSC had worked its way higher from its $34 bottom in December up until its peak in May. Then, for about (6) months the stock had been stalling at a $45 resistance (red), which was also a 52-week high resistance. Finally, last week AJG broke through that $45 resistance.

The Tale of the Tape: AJG broke out to a new 52-week high and now may be pulling back. A long trade could be made at $45 with a stop placed below that level. A break below $45 would negate the forecast for a continued move higher.
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Wednesday, October 23, 2013

Faber: Fed could up QE to $1 trillion a month

Marc Faber, publisher of The Gloom, Boom & Doom Report, told CNBC on Monday that investors are asking the wrong question about when the Federal Reserve will taper its massive bond-buying program. They should be asking when the central bank will be increasing it, he argued.

"The question is not tapering. The question is at what point will they increase the asset purchases to say $150 [billion] , $200 [billion], a trillion dollars a month," Faber said in a " Squawk Box " interview.

The Fed-which is currently buying $85 billion worth of bonds every month-will hold its October meeting next week to deliberate the future of its asset purchases known as quantitative easing . (more)

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This Year's Best Timing Indicator Now Says "Sell"

The stock market is overbought and primed to reverse lower... according to one of this year's most accurate market timing indicators.
The NYSE McClellan Oscillator (NYMO) is a measure of overbought and oversold conditions in the stock market. And its performance has been outstanding this year. We've used the NYMO to trigger several profitable short-term trades.
And right now, it's triggering another one...
The NYMO warned us stocks were overbought in mid-July and mid-September. That gave aggressive traders the chance to profit from a couple short trades as the S&P 500 fell more than 60 points within just a few weeks of each trigger.
The NYMO also warned us when stocks were oversold and primed for a rally.
We got "buy" signals in early June and late August. Each of these signals led to big rallies and profits for traders who jumped onboard.
Just two weeks ago, the NYMO triggered another "buy" signal. And the S&P 500 is up nearly 100 points since then.
There's no doubt that the NYSE McClellan Oscillator has been one of the best timing indicators of the year. So it pays to follow it. And right now, this indicator says it's time to sell. Take a look...
nymo overbought oversold graph
This year, the NYMO has reached oversold levels when it dropped below -60. It was overbought when it rallied above 60. In each of these cases, the stock market reversed almost immediately. Traders who bet on a reversal made fast profits.
Today, with the S&P 500 trading at all-time highs, the NYSE McClellan Oscillator is back in overbought territory. So traders should be on the lookout for a reversal and a chance to profit on a short-term decline in the market.
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General Motors Company (NYSE: GM)

General Motors Company (GM) designs, manufactures, and markets cars, crossovers, trucks, and automobile parts worldwide. The company markets its vehicles primarily under the Buick, Cadillac, Chevrolet, GMC, Opel, Holden, and Vauxhall brand names, as well as under the Alpheon, Jiefang, Baojun, and Wuling brand names. It also sells cars and trucks to dealers for consumer retail sales, as well as to fleet customers, including daily rental car companies, commercial fleet customers, leasing companies, and governments. In addition, the company offers connected safety, security and mobility solutions, and information technology services. The company, through its subsidiary, General Motors Financial Company, Inc. provides automotive financing services and lease products through GM dealerships in connection with the sale of used and new automobiles that target customers with sub-prime and prime credit bureau scores. The company was founded in 1908 and is based in Detroit, Michigan.
To review potential trading opportunities with GM's stock, please take a look at the 1-year chart of GM (General Motors Company) below with my added notations:
Possible double top for GM GM may have formed a double top price pattern (red) over the last 4 months. Double tops are reversal patterns and are as simple as they sound: Rallying up to a point (T), selling off to a support, and then rallying back up again to approximately the same top (T). As with any price pattern, a confirmation of the pattern is needed. GM would confirm its pattern by breaking below the $34 support (blue) that has been created by the double top pattern.

The Tale of the Tape: GM may have double topped. A long trade could be made at $34 or on a move above $38 (resistance). A short trade could be made on a support break of $34, which would confirm the double top.
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Gasoline Prices Skid as Diesel Burns

Booming diesel-fuel use in Europe and Latin America is paying off for U.S. drivers, as gasoline prices fall to a nine-month low.

October supplies of gasoline are at a three-year high for that month, but refiners are still running at high speed because they are earning fat profits exporting diesel, which is made using the same process that converts oil to gasoline.

U.S. refiners are supplying diesel to rebounding European economies where it is the main fuel used by cars and trucks. South America is another expanding market where local refiners can't match rising demand. Meanwhile, U.S. drivers' demand for their main fuel, gasoline, is coming off its summer peak.  (more)

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Airline Stocks About to Take Off: SAVE, RJET

It’s nearly impossible to discuss any positive news about the airline industry without inadvertently invoking flight-related metaphors. Nevertheless, recent earnings reports have inspired quite a few well-deserved nods of accomplishment.

The Airline Transportation sector of the Zacks Industry Rank list gained 84 positions last week; with several new earnings reports beating expectations. This is a large category of 25 companies, which now holds a rank of #92 out of 260 sectors. This is a boost of +84 positions over just one week. With positive earnings revisions outpacing negative 44 to 13, airlines are now averaging positive Earnings per Share (EPS) surprises of +27%.

There are a number of factors affecting this turnaround: reduced labor costs, increased consumer spending (dollar per mile), fewer flight cancellations, increased carrying capacity and the simple fact that people are just flying more this year compared to last. Combined, this means good news for an industry which has hurt more than most over the past decade.  (more)

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Tuesday, October 22, 2013

iShares MSCI Italy Capped (NYSE: EWI) My No. 1 Ranked International ETF is Signaling 'Buy' Now

Some studies have shown that most of a stock's return is due to the direction of the trend in a bull market. This can be seen in stock market breadth data. Breadth indicators include the advance-decline line and other data series that measure the number of stocks going up or down.

On days when broad market averages like the S&P 500 close higher, we generally see most stocks close up and breadth is positive. When the S&P 500 is down for the day, we usually see a majority of individual stocks fall and breadth is negative. This is true for weekly and monthly data as well as daily time frames.

Bull and bear markets also tend to play out on a global scale, and the indices of most countries will move up and down together. This tendency of global stocks to move together has been increasing in recent years as global economies have become increasingly interconnected.  (more)

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The Home Depot, Inc. (NYSE: HD)

The Home Depot, Inc. operates as a home improvement retailer. Its stores sell building materials, home improvement products, and lawn and garden products, as well as provide installation, home maintenance, and professional service programs to do-it-yourself, do-it-for-me, and professional customers. The company's installation programs include products, such as carpeting, flooring, cabinets, countertops, and water heaters. It serves homeowners, professional remodelers, general contractors, repairmen, small business owners, and tradesmen. As of September 26, 2013, the company operated 2,258 retail stores in 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, Guam, 10 Canadian provinces, and Mexico. The Home Depot, Inc. was founded in 1978 and is based in Atlanta, Georgia.
To review HD' stock, please take a look at the 1-year chart of HD (The Home Depot, Inc.) below with my added notations:
1-year chart of HD (The Home Depot, Inc.) HD has been trading mostly sideways for the last 5 to 6 months. Over that period of time, the stock has formed a resistance area around $80 (red), In addition, HD has created a strong level of support at $72 (green). At some point the stock will have to break one of those two levels.

The Tale of the Tape: HD has identifiable levels of support and resistance. The possible long positions on the stock would be either on a pullback to $72, or on a breakout above $80. The ideal short opportunities would be on a break below $72.
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