Marc Faber Exclusive – His Stunning 2014 Predictions

from King World News
As we near the end of what has been a wild 2013, today Marc Faber spoke exclusively with King World News about his major predictions for 2014. Faber also gave his thoughts on what he thinks is a solid contrarian play for investors. This is part I of a series of written interviews that will be released today on KWN in which Faber discusses his 2014 predictions, which include some fascinating surprises, and much more.
Eric King: “Marc, what are your major predictions for 2014?”
Faber: “I’m just thinking about this and the more I think about it the more I feel that we all don’t know how 2014 will end. First of all, we have geopolitical tensions that are rising, particularly in Asia. Who knows what this will lead to?….
Continue Reading at KingWorldNews.com…

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Costco Wholesale Corporation (NASDAQ: COST)

Costco Wholesale Corporation, together with its subsidiaries, operates membership warehouses. The company offers branded and private-label products in a range of merchandise categories. It offers candy, snack foods, tobacco, alcoholic and nonalcoholic beverages, and cleaning and institutional supplies; appliances, electronics, health and beauty aids, hardware, office supplies, cameras, garden and patio, sporting goods, toys, seasonal items, and automotive supplies; dry and institutionally packaged foods; apparel, domestics, jewelry, house wares, media, home furnishings, and small appliances; and meat, bakery, deli, and produce. The company also operates gas stations, pharmacies, food courts, optical dispensing centers, one-hour photo centers, and hearing aid centers; and travel businesses. In addition, it provides business and gold star (individual) membership services.
To review Costco’s stock, please take a look at the 1-year chart of COST (Costco Wholesale Corporation) below with my added notations:

From July through October, COST formed a nicely defined rectangle pattern with a $120 resistance (blue). That resistance was also the 52-week high. After breaking through that resistance in November, the stock moved higher as expected. Now, as can commonly occur, the stock seems to be pulling back to the old 52-week high breakout point. The $120 that was previously resistance should now act as support if the stock gets there.

The Tale of the Tape: COST broke out to a new 52-week high and has now pulled back. A long trade could be made at $120 with a stop placed below that level. A break below $120 would negate the forecast for a continued move higher.
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World’s Biggest Investor BlackRock Says US Rally Nearing Exhaustion

BlackRock has advised clients to be ready to pull out of global stock markets at any sign of serious trouble
by Ambrose Evans-Pritchard
Telegraph.co.uk
BlackRock, the world’s biggest investor, has warned that central banks are poised to tighten monetary policy in the Anglo-Saxon countries and China, advising clients to be ready to pull out of global stock markets at any sign of serious trouble.
“2014 is the year to squeeze more juice out of risk assets. But investors should be ready to discard the fruit when it starts running dry,” said Ewen Cameron Watt, chief strategist for the BlackRock Investment Institute.
The group said in its 2014 Investment Outlook that investors have “jumped on the momentum train, effectively betting yesterday’s strategy will win again tomorrow”, but vanishing liquidity could leave them trapped if the mood changes. “Beware of traffic jams: easy to get into, hard to get out of,” it said.
Continue Reading at Telegraph.co.uk…
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5 Stocks That Could Soar in 2014: FAST, VMW, AA, WY, DE

2013 is drawing to a close, and unless catastrophe strikes in its final weeks, both the Dow Jones Industrial Average (DJIA) (DIA) and the S&P 500 (SPX) (SPY) will end the year at or near record highs. Though the year has been marked by political turmoil in the US, stagnation in Europe, war in the Middle East, crisis in India, and a host of troubles in East Asia, stock prices have crept persistently and inexorably higher. Somewhat oddly, this bull market is not being supported by any surge in economic growth, nor does it seem to be causing one, which makes it appear almost hermetically disconnected from the real world. It must be allowed that the market is displaying some of the characteristics of a bubble.
Before you head for the hills, however, consider that the lackluster economy is actually the strongest argument against the bubble hypothesis. America is still taking up the slack in its economy created by the highly destructive crash of 2008, and it will be doing so for some time. Consumers, who were prone to wild fits of optimism in the last economic cycle, have been chastened and continue to spend carefully out of necessity. There was real consolidation and scaling back in wake of the crash, and although this caused a second wave of economic damage, it was necessary, and it is over now; things have been moving in the right direction since early 2011. (more)

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Gold COT Data Again Proclaiming a Price Bottom

December 06, 2013

Back in June 2013, when gold was making its lowest price low since early 2011, I pointed out that commercial gold futures traders were at a really low net short position according to the Commitment of Traders data, and that this was a meaningful sign of a price bottom.  Now we are seeing a similar condition in the commercial traders' net position, which is conveying a similar message.

The Commitment of Traders (COT) Report is published each Friday by the CFTC, showing traders' positions as of the preceding Tuesday, and broken down into 3 groups: Commercial traders (big/smart money), non-commercial traders (large hedge funds), and non-reportable traders (small-time traders who as a group typically do the opposite of what ends up being a good idea).  The commercial traders are generally the ones to bet with, but there is a big fat caveat: often the commercial traders will get to a big skewed condition early, and so while they may end up being right in the long run, betting with them too early can get expensive. (more)

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The Dow Chemical Company (NYSE: DOW)

The Dow Chemical Company manufactures and supplies chemical products for use as raw materials worldwide. The company operates in several segments: The Electronic and Functional Materials segment, the Coatings and Infrastructure Solutions segment, the Agricultural Sciences segment, the Performance Materials segment, the Performance Plastics segment and the Feedstocks and Energy segment. The company has a strategic alliance with Sol Systems LLC to provide turnkey solar renewable energy credit solutions. The Dow Chemical Company was founded in 1897 and is based in Midland, Michigan.
DOW seems to have formed a head and shoulders (H&S) pattern. Please take a look at the 1-year chart of DOW (Dow Chemical Company) below with my added notations:

After rallying much higher this past year, DOW has now created a key level of support at $38 (red). That $38 level is also the “neckline” support for DOW’s H&S reversal pattern. Above the neckline you will notice the H&S pattern itself (blue).
Remember, patterns such as an H&S need to confirm to have the meaning that they imply. Confirmation of the H&S would occur if the stock were to break below its $38 support. If DOW does break that level, the stock should move lower from there.

The Tale of the Tape: DOW appears to have formed a head & shoulders pattern. Although a trader could go long at $38 expecting a bounce, the stock’s pattern would seem to imply an eventual breakdown. If that happens, a short trade should be entered on a break of that $38 level.
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