Wednesday, March 13, 2013

Silver To Eclipse $100 On Skyrocketing Chinese Demand

from King World News
With gold and silver rebounding today, acclaimed money manager Stephen Leeb told King World News that silver is now setting up to eclipse $100. “Silver under $30 is a joke,” Leeb said. Leeb believes that China, which has been the primary driver in the gold market, is now going to push silver over $100 as their consumption of silver is poised to skyrocket. Here is what Leeb had to say in this powerful, exclusive interview: “Yesterday headlines were saying there is massive demand for photovoltaics in Japan and China. There is also massive demand for silver in the Middle-East for this type of energy infrastructure.”
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Bed Bath & Beyond Inc. (NASDAQ: BBBY)

Bed Bath & Beyond Inc., together with its subsidiaries, operates a chain of retail stores. It sells a range of domestic merchandise, such as bed linens and related items, bath items, and kitchen textiles; and home furnishings, including kitchen and tabletop items, fine tabletop, basic housewares, general home furnishings, consumables, and certain juvenile products. The company also offers giftware, household products, and health and beauty care items; and infant and toddler merchandise. Bed Bath & Beyond Inc. operates stores under the names of Bed Bath & Beyond (BBB), Christmas Tree Shops (CTS), Harmon and Harmon Face Values (Harmon), and buybuy BABY. In addition, it distributes textile products, amenities, and other goods to customers in the hospitality, cruise line, food service, healthcare, and other industries. As of November 24, 2012, the company had 1,466 stores, including 1,003 Bed Bath & Beyond stores; 264 stores under the names of World Market, Cost Plus World Market, or World Market Stores; 74 stores under the names of Christmas Tree Shops or andThat!; 78 buybuy BABY stores; and 47 stores under the names of Harmon or Harmon Face Values in 50 states, the District of Columbia, Puerto Rico, and Canada. Bed Bath & Beyond Inc. was founded in 1971 and is headquartered in Union, New Jersey.
To review Bed's stock, please take a look at the 1-year chart of BBBY (Bed Bath & Beyond, Inc.) below with my added notations:
1-year chart of BBBY (Bed Bath & Beyond, Inc.) BBBY has had a rough go of it since peaking in June. However, over the last (3) months the stock has been consolidating within a small, rectangle pattern. Rectangle patterns form when a stock gets stuck bouncing between a horizontal support and resistance. A minimum of (2) successful tests of the support and (2) successful tests of the resistance will give you the pattern. For BBBY, the rectangle pattern has formed a $60 resistance level (red), which was also a prior support, and a $55 support level (blue).
The Tale of the Tape: BBBY has formed a rectangle pattern. The possible long positions on BBBY would be either on a pullback to $55, or on a breakout above $60. The ideal short opportunity would be on a break below $65 or at $70.
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UK Heading Toward Third Recession In 4 Years

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gbp-usdUK industrial production and manufacturing production dived in January, according to the latest official numbers released today.
The report raising fears that the UK is heading toward its third recession in only four years.
Sterling fell sharply on the news with GBP/USD reaching the lowest level of 1.4830, unseen since July 2010, before rebounding slightly.
GBP/USD – Weekly Chart
Here’s an excerpt from today’s report for our members:
“GBP/USD has been trading in the 1.48457– 1.50547 range. Our target of 1.48457 was reached today, and we hope you took profits. Our new revised range is: 1.44941– 1.50547.
It’s OK to hold short positions. More weakness coming for GBP/USD as it continues to make new lows. However, the move in GBP/USD seems a little overdone, and we would not be surprised to see a counter-trend rally up to 1.50151 resistance level. All the rebounds should be capped by 1.53567 area, if 1.50151 is broken. “
GBP/USD – 4 Hour Chart
Industrial production rose 1.1% in December 2012. The expectation was for a 0.1% rise in January 2013, but industrial production fell 1.2% unexpectedly. At the same time British manufacturing output slumped by 1.5% in January 2013 compared with December 2012.
Everyone understands that something has to be done to fix British economy, but the government has little room to cut taxes and unable to cut spending at this time.  As a result, Bank of England is expected to revive the faltering economy on its own. The latest developments in UK suggest that Bank of England has no choice but to gear up for another round of stimulus in the near future. That would support our outlook for continued downtrend of GBP/USD.
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Ponzi Monetary Policy, Buffett’s Favorite Valuation Indicator and Real Estate…

Here’s a radio interview I did last week with Dan Cofall on 1190AM.  My segment starts around the 4 minute mark.  Some of the topics covered:
  • Explaining why monetary policy that directly targets stock prices can be misguided.
  • The Bernanke Fed is essentially implementing the same “wealth effect” strategy that the Greenspan Fed lived and died by.
  • Explaining Warren Buffett’s favorite valuation index – the Wilshire 5,000 relative to GNP.
  • I don’t think we’re currently in a stock market bubble, but I think this valuation indicator should be paid close attention to as it tends to show instability in asset prices when it’s well above the 100% level.
  • Why I think housing has probably bottomed, but will not boom again.
Listen in here.
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Jim Rogers: We're Wiping out the Savings Class Globally, to Terrible Consequence

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Chart of the Day - Affymetrix (AFFX)

The Chart of the Day is Affymetrix (AFFX).  I found the stock by sorting the New High list of stocks trading over 100K shares a day and then sorted for frequency.  Next flip through the charts using the flipchart tab.  The stock hit 15 new highs and is up 22.73% in just the past month.  The Trend Spotter also triggered a buy signal on 1/8 and the stock is up 27.50% from that point.

The Company's technology is used by pharmaceutical, diagnostic and biotechnology companies as well as academic, government and not-for-profit research institutes.

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This could be the cheapest big gold stock in the world today

I have written several posts recently about the HUI Gold Bugs Index using fundamental analysis techniques, such as earnings and projected earnings for each of the 16 gold miners comprising the index. And I have pondered the future of gold miners using technical analysis that has considered established price trend lines and the momentum of both index and individual component miners using the True Strength Index (TSI) indicator. Finally, I have offered my thoughts using something of a hybrid analysis technique. That being the supply/demand positioning of the hard ball professional traders, otherwise identified as the Commercial and Managed Money subsets and identified in the weekly Commitment of Traders Report (COT).

But tonight, this post will be different once again, though it will be about the HUI Gold Bugs Index - at least indirectly. Rather than discuss the HUI index at large, I am so disgusted with how stupid cheap this group has become I thought it fun to see if I could figure out which of the 16 is the 'most stupid cheap' (and by implication most likely to appreciate fastest when the selling pressure is exhausted).

If you would like to consider a huge miner with enormous capitalization, gigantic liquidity, lots of cash in its vault, positive earnings, diversified multi-national operations, a history of getting oversold then moving hundreds of percent higher within a single year and of course, selling TODAY at a stupid cheap price, then I think I just may have a stock you'll want to take a closer look at. 

With no further adieu, I give you my vote for the 'Most Stupid Cheap' gold miner of the HUI Gold Bugs Index. 


Let's take a look at the monthly and weekly charts, beginning with the monthly, and see what this cash-cow of an investment looks like.

Click on any chart to ENLARGE
This very morning IAG traded down to $6.04 then bounced to close with a 5.31% gain for the day at $6.55.

The TSI has provided a positive divergence BUY signal and downward momentum appears about ready to be declared exhausted.  (more)

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