Wednesday, January 15, 2014

How to Profit from Oil's Next Move Higher

Get ready for a bounce in oil.
After falling 8% over the past three weeks, the price of West Texas Intermediate crude oil (WTIC) is oversold and may be ready for a short-term move higher...
Take a look at this daily chart of WTIC...
The price of oil broke down from a bearish rising-wedge pattern in late December. It has retraced the entire height of the wedge and is now resting on support at about $92 per barrel. This is a logical place to look for an oversold bounce.
Aggressive traders might consider buying oil here and betting on a move back up to resistance at about the $96 level.  (more)
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23 Reasons to Be Bullish on Gold

It’s been one of the worst years for gold in a generation.

A flood of outflows from gold ETFs, endless tax increases on gold imports in India, and the supposedly improving economy in the U.S. have all contributed to the constant hammering gold took in 2013.

Perhaps worse has been the onslaught of negative press our favorite metal has suffered.
It’s felt overwhelming at times and has pushed even some die-hard goldbugs to question their beliefs… not a bad thing, by the way.

Last year’s winner of negative rhetoric was probably Goldman Sachs, calling gold a “slam-dunk sale” for 2014 (this, of course, after it’s already fallen by nearly a third over a period of more than two and a half years).  (more)

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How Low Will Energy Stocks Go?

Monday was the worst day for the stock market since last November as the Spyder Trust (SPY) was down 1.33%. This was better than the 2% or greater declines in the Philadelphia Housing and Oil Service sectors.

The market selloff was blamed on lower crude oil prices along with concerns about the earnings season, which hits full stride this week. So far, 90% of the companies that have released pre-announcements for the earning season have lowered their estimates.

Asian markets were hit hard overnight but the losses, so far, are not that bad in the Eurozone. The banks will get the focus today with JPMorgan Chase & Co. (JPM) and Wells Fargo & Company (WFC) reporting today. JPM just reported a 7.3% drop in quarterly profits before the opening. (more)

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Keryx Biopharmaceuticals (NASDAQ: KERX)

Keryx Biopharmaceuticals, Inc., a biopharmaceutical company, focuses on the acquisition, development, and commercialization of pharmaceutical products for the treatment of renal disease in the United States. It is developing Zerenex (ferric citrate), an oral, ferric iron-based compound that has the capacity to bind to phosphate in the gastrointestinal tract and form non-absorbable complexes. The company has completed Phase III clinical program for Zerenex for the treatment of hyperphosphatemia (elevated phosphate levels) in patients with end-stage renal disease on dialysis. Zerenex is also in Phase II development for the management of phosphorus and iron deficiency in anemic patients with stages three to five non-dialysis dependent chronic kidney diseases.
Please take a look at the 1-year chart of KERX (Keryx Biopharmaceuticals, Inc.) below with my added notations:
1-year chart of KERX (Keryx Biopharmaceuticals, Inc.)
KERX has held a very important level of support at $12 (blue) since mid-November. That $12 support was also resistance back in October. Now, the stock is approaching $12 again and that might provide another bounce higher. However, the stock’s recent lagging of the overall market could be setting the stock up for a breakdown.

The Tale of the Tape: KERX has a key level of support at $12. A trader could enter a long position at $12 with a stop placed under the level. If the stock were to break below the support, a short position would be recommended instead.
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Micron Technology (NASDAQ: MU) Major Breakout Could Lead to Fast Profits

On Jan. 8, memory chip manufacturer Micron Technology (NASDAQ: MU) reported better-than-expected fiscal first-quarter 2014 earnings. As a result, the stock rallied to fresh multiyear highs, and this new found upside momentum now looks to offer traders a quick profit.

The company reported earnings per share minus items of $0.77, handsomely beating Street estimates of $0.43. It also beat on the top line with a 120% year-over-year revenue increase to $4.04 billion versus estimates of $3.72 billion.

One of the headline items that seemed to surprise investors was the 69% increase in revenue from DRAM memory chips from the previous quarter. And gross margins widened to 32% from 25% in the prior quarter. This was helped by rising DRAM prices, a trend analysts believe will continue.(more)

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Loss Of Confidence & Collapse

Today the man who oversees more than $160 billion warned King World News that a loss of confidence threatens to collapse the world financial system.  Rob Arnott, who has won an unprecedented six Graham & Dodd Awards and is also Chairman of Research Affiliates, also cautioned KWN about the direction the United States is headed in in his powerful interview below.
Eric King:  “Rob, I know you had a chance to read the David Stockman interview here at King World News and I just wondered about your thoughts as you read that?”
Arnott:  “I thought that was a wonderful interview.  I love David Stockman’s candor.  I think politically we are on a very, very dangerous path.  Washington broadly, and to some extent I think this is bipartisan, views the private sector with skepticism, views the private sector to some extent as the enemy, views entrepreneurialism as the enemy….
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