Tuesday, November 5, 2013

AngloGold Ashanti Limited (NYSE: AU)

AngloGold Ashanti Limited engages in the exploration, production, and marketing of gold. It also produces by-products, such as silver, uranium, and sulfuric acid. The company's principal projects include the Gramalote and the La Colosa projects located in Colombia; the Kibali and the Mongbwalu projects located in the Democratic Republic of the Congo; and the Tropicana project located in Australia. It also operates in South Africa; Continental Africa, including Ghana, Guinea, Mali, Namibia, and Tanzania; and the Americas comprising Argentina, Brazil, and the United States. AngloGold Ashanti Limited was founded in 1944 and is headquartered in Johannesburg, South Africa.
Please take a look at the 9-month chart of AU (AngloGold Ashanti Limited) below with my added notations:
9-month chart of AU (AngloGold Ashanti Limited) Ashanti's stock had been trading in a sideways range since June and now seems to have formed a base. Several times over the last (5) months, the stock had also formed a key resistance level at $15 (red). Earlier this week the stock finally broke up out of its base and above that important $15 level. So, assuming AU holds $15, the stock should be moving overall higher from here.

The Tale of the Tape: AU had a key level of resistance at $15 that should now act as support on any pullbacks. A long trade could be entered on a pullback to $15 with a stop placed below that level. A break back below $15 could negate the forecast for a move higher.
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Facebook (FB) Is A Buy On Weakness

Ever since Facebook released earnings last quarter this has been one of the leaders driving this market rally. So it makes sense to target this stock on any meaningful pullback.  Some would say after rallying 15 plus percent that this was due for a pullback, and those that said would have been wrong. Often times the strongest stocks never look back. I traded in and out of this for a tiny gain and missed nearly all of this move, however it did provide some buying opportunities along the way but due to an iffy market and the Gov’t shutdown and Debt Ceiling I chose to sit out of some of late Sept.
However I believe this could be setting up over the next few weeks for another good buying opportunity if it pulls back to the levels I annotated below. I think this recent earnings report was slightly priced in and that’s why it’s pulled back (or at least hasn’t screamed higher) and it still needs time to digest the massive gains it’s had last quarter.

I think it’ll pull back between $42 and 35. Now that is a wide range so the absolute safest way is to scale in three times at 42, 38, and 35 if you don’t have specific methods for entering momentum stocks. That way you don’t over-think the trade and get a position started while cost averaging should it go down. I generally scale in only twice, but that is a preference. While it’s tough to say exactly when I’ll start buying because I like to see how it pulls back, but I suspect it’ll be somewhere around $40 and maybe avg down if it does get near $35. I also consider market conditions and how leveraged I am when making a trade so it’s nearly impossible for me to say where I”m going to buy a stock 2-3 weeks from now, but that’s somewhere near.
Of course if it never makes it down that far at all and screams higher then I’m OK to let it go because I feel the reward/risk just isn’t there buying anytime above $42. That also happens when trading.
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All signs say the world's last "dirt-cheap" stocks are set to SOAR

After all the big gains in stocks lately, where can you find cheap stocks now?

They're not easy to find...

The U.S. stock market is up 24% in 2013. So you might need to consider stocks outside the U.S.

Ah, but that doesn't do it, either... Japan's Nikkei Index is up 33% over the last year. And Europe's blue-chip index – the Euro Stoxx 50 – is up 36% in the past two years.

After all these big gains, finding truly cheap opportunities is getting harder. However, there is one place that hasn't run away from us yet...

If you're willing to step outside your comfort zone, you have an opportunity to buy a beaten-down stock market that's poised to soar.

Let me explain...

I tapped our massive True Wealth Systems databases to find the world's cheapest stock markets. And it turns out, the real value out there is in emerging markets...

But I dug deeper. I sized up emerging markets on three different measures – book value, earnings, and dividend yield – to determine which countries offer the best value, based on their own history.

It turns out that Russian stocks are the cheapest now relative to their history based on book value, earnings, and dividend yield...

Russian stocks are crazy-cheap compared to their history. Based on earnings, they trade at a 35% discount to their historical price-to-earnings (P/E) ratio... and that's not even the crazy part.

Russia's RTS Index trades for just 4.5 times next year's earnings, as I write. That's cheaper than any major stock market on earth.

There's no question... Russia is dirt-cheap compared to both its own history and the rest of the globe.

And importantly, Russian stocks have been trending higher over the last few months. The Market Vectors Russia Fund (RSX) is on the verge of breaking out of its two-year trading range. Take a look:

As you can see, Russian stocks are up big since the middle of this year. RSX is up 22% since bottoming in June.

And a breakout of the current trading range could lead to even bigger returns. From current prices, I wouldn't be surprised to see RSX double in value over the next couple years.

Today, emerging markets are cheap, and they're beginning to exit their multi-year bear market. Russia is the cheapest of the cheap. And I believe it's just getting going.

The opportunity to buy an entire stock market at today's ultra-cheap value doesn't come around often.

While it might seem uncomfortable to invest in Russia, with this incredible value and a new uptrend in place, it's a risk worth taking today. And shares of RSX are the easiest way to invest.
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Mattel, Inc. (NASDAQ: MAT)

Mattel, Inc., together with its subsidiaries, designs, manufactures, and markets various toy products. The company operates in three segments: North America, International, and American Girl. Its products comprise fashion dolls and accessories, vehicles and play sets, and games and puzzles. The company also publishes advice and activity books, as well as magazines. It offers its products under the Mattel Girls and Boys brands, including Barbie, Polly Pocket, Little Mommy, Disney Classics, Monster High, Hot Wheels, Matchbox, Tyco R/C, CARS, Radica, Toy Story, Max Steel, WWE Wrestling, Batman, and Superman; Fisher-Price brands comprising Fisher-Price, Little People, BabyGear, Imaginext, Dora the Explorer, Go Diego Go!, Bubble Guppies, Thomas & Friends, Mike The Knight, Octonauts, Mickey Mouse Clubhouse, Disney's Jake and the Never Land Pirates, See N Say, and Power Wheels; and American Girl Brands, such as My American Girl, Bitty Baby, McKenna, and the newest Girl of the Year.
To review Mattel's stock, please take a look at the 1-year chart of MAT (Mattel, Inc.) below with my added notations:
1-year chart of MAT (Mattel, Inc.) MAT has been trading sideways for the last 3 months. Over that period of time, the stock has formed a clear resistance level at $44 (red). In addition, the stock has also created a strong level of support at $40 (green) that has held since the end of August. At some point the stock will have to break one of those two levels.

The Tale of the Tape: MAT has identifiable levels of support and resistance. The possible long positions on the stock would be either on a pullback to $40, or on a breakout above $44. The ideal short opportunities would be on a break below $40 or on a rally up to $44.
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Two Ways to Play Anti-Volatility : VXX,SVXY, XIV, VIX

I want to apologize again for missing that the iPath S&P 500 VIX Short-Term Futures ETN (NYSEARCA:VXX) had already announced a 1:4 split. Consider yourself lucky, though. If I hadn't missed it, I would have poked fun at the VXX in about 12 separate posts. Now, instead, I feel remorseful. All I'll really add is that now that the split -- effective this Friday -- is done, like every other split ever, it adds no "value," it just alters the optics. As of Friday, the "new" VXX will have a split-adjusted original price of $6,400. So, I suppose the hope is that no one remembers that factoid.
The world, in general, always seems to want to time the next big volatility pop. On Friday, Brendan Conway's "Focus on Funds" took the opposite angle and focused on a couple of our favorite exchange-traded… Well…

Two of the ETTs ("exchange-traded thingamabobs") offering what amounts to an "anti-volatility" bet are ProShares Short VIX Short-Term Futures ETF (SVXY) and VelocityShares Daily Inverse VIX Short-Term ETN (XIV). SVXY soared 150% in 2012 and it's up 73% this year. XIV's numbers are similar.  (more)

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