Tuesday, July 16, 2013

SNP: With a 7.31% Yield, It’s Time to Reconsider This Stock

Emerging markets have been getting pounded. Look no further than two representative ETFs for proof…
The iShares MSCI Emerging Markets ETF (NYSEARCA: EEM) is down more than 15% year-to-date.
And the iShares FTSE/Xinhua China 25 Index ETF (NYSEARCA: FXI) is down almost 24% over the same period.
These ETFs do pay dividends, 2% and 2.87% current yields, respectively, but there are stocks in emerging markets, and in China specifically, that have much bigger dividends, depressed share prices and big opportunities. And one particular Chinese oil company that we’ve singled out in the past looks particularly compelling. Namely, China Petroleum & Chemical Corporation (NYSE: SNP).
Last time, after we published our analysis, the stock price went from $71 to more than $94 per share… (more)

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What Does a Currency Collapse Look Like?

In Part one of this series, I detailed how this administration has set themselves up to roll out martial law like no other martial law in history. Part one further revealed that the mechanisms needed for hard-core martial law are either active or merely waiting in the wings. All that is needed for unmistakable martial law to be rolled out in its entirety, is for the right trigger event to take place.

Will It Be a False Flag Attack Or a Currency Collapse?

currency collapse1My initial response to that question is, does it really matter? The pattern of societal collapse and subsequent governmental enslavement of the American people will be largely the same whether the precipitating incident is a false flag attack or a currency collapse. For the purpose of simplicity, let us call the precursor event to all-out martial law, a currency collapse.

The Federal Reserve Is the Enemy of Humanity

The Federal Reserve has been bleeding this country to death for exactly one century. What the dollar bought 100 years ago, can only buy three cents of product today. This means that 97% of the value of our currency has gone into the pockets of the Federal Reserve.
I am amazed at the abject ignorance of the American people and that they think the Federal Reserve is actually part of the federal government. As we like to stay in the alternative media, the Federal Reserve is no more federal than Federal Express. (more)
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Finisar Corporation (NASDAQ: FNSR)

Finisar Corporation provides optical subsystems and components for data communication and telecommunication applications in the United States, Malaysia, China, and internationally. The company's optical subsystems primarily consist of transmitters, receivers, transceivers, transponders, and active optical cables that provide optical-electrical or optoelectronic interface for interconnecting the electronic equipment used in building communication networks, including the switches, routers, and servers used in wireline networks, as well as the antennas and base stations for wireless networks. It also offers wavelength selective switches that are used to dynamically switch network traffic from one optical fiber to multiple other fibers without converting the optical signal to an electronic signal. The company's optical components primarily consist of packaged lasers and photo detectors for data communication and telecommunication applications; and passive optical components for telecommunication applications.
To review Finisar's stock, please take a look at the 1-year chart of FNSR (Finisar Corporation) below with my added notations:
1-year chart of ATW (Finisar Corporation) Finisar's stock has been stuck within the same $11 to $17 area for the entire year. However, during that time, FNSR has created a strong resistance at $17 (navy) and the stock has tried to push through that resistance several times. A break through that $17 resistance would be a new 52-week high for the stock and should mean higher prices moving forward.
The Tale of the Tape: FNSR has a 52-week high resistance at $17. A long trade could be entered on a break through that level with a stop placed under it.
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PCLN: This 90-Bagger Could Double From Current Levels

Legendary stock picker Peter Lynch used to salivate over what he called 10-baggers -- stocks that increased 1,000%.

Admittedly, that's incredible performance, but nothing compared to the track record of Priceline.com (NASDAQ: PCLN), one of the largest online travel booking websites. Over the past 10 years, this dot-com gem has rallied more than 9,000%. That's a 90-bagger!

Shares have skyrocketed, from split-adjusted lows near $10 in 2003 to their current multi-year high above $914. While the biggest gains may or may not be behind it, short-term traders can still profit.

According to Morgan Stanley (NYSE: MS), there's still plenty of upside potential. In fact, shares could be the first dot-com to surpass the $1,000 mark -- a feat not even Google (NASDAQ: GOOG) has achieved.

Because of a growing appetite for travel based on the improving economy, Morgan Stanley has set a price target of $1,010. Technically the stock could go much higher with a long-term target near $2,000 if you're an investor rather than a trader.

PCLN Chart
Since the summer of 2012, the stock has moved steadily higher. In early May 2013, the shares successfully broke $774.96 resistance, and in doing so, completed a long-term basing pattern. The top of the base is marked by $774.96 resistance (which now acts as support) and the bottom is at previous support around $553. (more)
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Continuous Commodity Index Points to Rally in Gold & Silver

During the recent weeks we have seen commodities especially precious metals continue to drop in value. Market participant sentiment has become more bearish on commodities and couple that with a rising dollar it's no wonder why we continue to see commodities as a whole fall in value.
Money has been flowing out of bonds at record levels this summer telling us most of market participants are feeling bullish on the stock market. This shift in sentiment of the masses are typical as they move their money from the risk on safer assets (bonds & commodities) and rotate into risk-on assets like stocks. While this is a bearish (contrarian sign) stocks could easily continue to rally for an extended period of time and possibly several more months before they actually top out.

Let's take a look at the financial market business cycle diagram:

Bond prices have been falling for months and they typically lead the stock market lower. I feel we are starting to enter the phase where stocks will soon top and head lower also. Once this starts money will naturally flow into safer assets that are more tangible like commodities.
Keep in mind this cycle is very slow moving and rotation from one phase to another takes months. This is a process not an event but it is still very tradable.

Precious Metals
Now let's fast forward to precious metals both gold and silver are likely to do in the next couple months. If you review the charts below you will see gold and silver bullion prices are looking primed for a bounce/rally from these deep oversold levels.

Gold Weekly Price

Silver Weekly Price


Take a look at a basket of commodities through the GCC ETF.

GreenHaven Continuous Commodity Index Fund (GCC) is an Exchange-Traded Fund (ETF) that provides an innovative and efficient way to deliver broad based, diversified commodity exposure. It aims to achieve this by using futures contracts to track the Thomson Reuters Equal Weight Continuous Commodity Total Return Index (CCI). The CCI-TR is an equal weighted index of 17 commodities plus an additional Treasury Bill yield. Because of the equal weighting, GCC offers significant exposure to grains, livestock, and soft commodities and a lower energy weighting than many of its peers. In addition, GCC is rebalanced every day in order to maintain each commodity's weight as close to 1/17th of the total as possible.
So, knowing metals are 24% of the index it bodes well for a bounce in the overall commodity index. Keep in mind this report is only focusing on precious metals, but many other commodities look ready to rally also like natural gas.

GCC - Continuous Commodity Index Fund Weekly Trading Chart

The chart below shows a very bullish 4 year chart pattern. At the very minimum a bounce to the $29 is highly.

Commodity Basket Trading Conclusion:

In short, commodities as a whole remain in a down trend. Until they show signs of real strength I will not be trying to pick a bottom. Several commodities are starting to look oversold and ready for a bounce like sugar, coffee, copper and natural gas.
Last month I talked about how a major market top is likely to unfold during the second half of this year. I still believe this to be true. But keep in mind these major market tops which only happen every few years are a MAJOR PROCESS. They take time to form and often we will see a series of new highs followed by quick sell offs as the market gets more people long as they big money distributes their shares/contracts into the new money rotating into the market.
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Leaked IMF Report Shows Dangers For US Economy

By Daniel R. Amerman, CFA

A confidential internal International Monetary Fund report was recently leaked to the Wall Street Journal, with the contents later being made public by the IMF. The contents of this report have major implications for Europe, but even greater implications for the United States.

Most of the press attention is being paid to the legalities associated with the report, and revolve around what the International Monetary Fund knew, when it knew it, and whether it properly acted within its charter at various points. However, what is being overlooked is the truly explosive information that comes in the form of what the IMF admitted (in this internal report to itself) when it came to miscalculations about "austerity", and closing budget deficits.

Briefly, the International Monetary Fund and European Union did not force balanced budgets upon Greece, but only a reduction in the level of deficits.  (more)

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