Wednesday, March 4, 2015

3 Value Stocks to Own before Oil Bottoms: Greenbrier Companies (NYSE: GBX), Chicago Bridge & Iron (NYSE: CBI), Mastec (NYSE: MTZ)

One of the recent trends I have seen in the market is some of the industrial and construction plays that have plunged with the price of crude oil are posting much better than expected results. These stocks are now staging impressive rallies that are only just beginning.
Given how severely and unfairly these shares were beaten up this is not surprising. Patient value investors are being rewarded for scooping up these cheap shares while panic engulfed everything connected to the oil and gas industry over the past few months. (more)
Please share this article Inc (NASDAQ: SOHU) Inc. provides online media, search, gaming, community, and mobile services in the People’s Republic of China. The company’s brand advertising business offers advertisements on its Websites to companies to enhance brand awareness; and search and others business provides customers pay-for-click and online marketing services. Its online game business develops, operates, and licenses online games and Web games; mobile business offers short messaging services, mobile games and, ring back tones, and interactive voice response to mobile phone users; and others business offers Internet value-added services and licensed video content.
Take a look at the 1-year chart of Sohu (Nasdaq: SOHU) below with my added notations:
1-year chart of Sohu (Nasdaq: SOHU)
SOHU has formed a relatively clear up-channel chart pattern over the last 4 months. A channel is simply formed through the combination of a trend line support that runs parallel to a trend line resistance. When it comes to channels, remember that any (3) points can start the channel, but a 4th point or more confirms it. You can see that SOHU has several points of channel resistance (red) and support (green).

The Tale of the Tape: SOHU has formed an up-channel. A long trade could be entered on a pullback down to the channel support, which currently sits near $52, or on a break through the channel resistance, which is currently sitting near $60. Short opportunities would be on rallies up to channel resistance or on a break of channel support.
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Could Oil Prices Plummet A Second Time?

by Nick Cunningham
Oil Price

Are oil prices heading for a double dip?
The surge in shale production has produced a temporary glut in supplies causing oil prices to experience a massive bust. After tanking to a low of $44 per barrel in January, falling rig counts and enormous reductions in exploration budgets have fueled speculation that the market will correct sometime later this year.
However, there is a possibility that the recent rise to $51 for WTI and $60 for Brent may only be temporary. In fact, several trends are conspiring to force prices down for a second time.
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Warren Buffett, Charlie Munger And A Major Warning

from King World News
With people around the world still nervously watching Greece and Ukraine, today King World News is featuring a piece from one of the greats in the business that includes Warren Buffett, Charlie Munger and a major warning.
“In our early decades, the relationship between book value and intrinsic value was much closer than it is now. That was true because Berkshire’s assets were then largely securities whose values were continuously restated to reflect their current market prices.” — Warren Buffett, Berkshire’s Annual Letter
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Is Twitter Stock TWTR About to Break Out?

Since the initial peak after its IPO in 2013, shares of Twitter have been trending lower, well-defined by a series of lower highs. Over the last few months, however, shares were able to stabilize and put in their first lower high since the lows last Spring. This has now given Twitter the appearance of more of a large sideways consolidation, rather than the downtrend that we just pointed out.
Here is a daily candlestick chart of $TWTR. What stands out to me here is how after the gap higher in shares early last month, prices have remained up here near the downtrend line from December 2013, rather than correcting to the downside from this resistance level. To me, this is always the more healthy way to consolidate gains:
2015-03-03_10-46-47 twtr
I’ve been arguing that the longer shares remain up here near this downtrend line, the higher the likelihood that we break out. I think this would be a very bullish development if prices resolve themselves to the upside above the upper of these two converging trendlines, especially with what is now an upward sloping 200 day moving average (red line).  (more)
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