Wednesday, June 30, 2010

Waddling Wednesday

Dow Jones 9,774.02 -96.28 -0.98%
NASDAQ 2,109.24 -25.94 -1.21%
S&P 500 1,030.71 -10.53 -1.01%

It's becoming a habit, this getting up with an hour left in the market. I was up by 9:15 am Hawaii time, early enough to see AAPL trade at 253.33, down a few bucks from yesterday's lower close. I rubbed the makapiapia out of my eyes and AAPL was at 252. A few minutes later, shares dropped below 251 and set to plunge below 250.

That's where it held ground, at 250.01, and closed at 251.46, down 1.84%. Never mind the repeated rumor about Apple and Verizon coming to terms on a deal for iPhone 4; the stock has tanked since hitting 279 little more than a week ago. From a short-term low of 242 to 279 in one week was drastic, and now AAPL fades despite good news. It had to sell off on the release of the new iPhone, but market forces are always too strong, even for Apple.

There just aren't enough buyers out there. There just aren't enough reasons to go long here. The recovery has slowed, China is continuing to hit the brakes and people are on vacation. That makes it a playground for the high-frequency traders and their robots.

TECH KINGS
GOOG dropped 2.05% to 444.95 and is looking more attractive than ever. But I continue to wait. The Apple-Verizon partnership could hamper Google's Droid X campaign. Two winners are definitely possible in the future world of mobile communications and advertising.

Apparently, Google hasn't given up on China yet. Until there's something firm between the Googsters and the People's Republic, though, it's superficial.

ALL THINGS CHINA
Baidu finished up 0.75% to 68.08, a nice surprise despite falling off an intraday high of 70.35.

FXI lost 0.46% to 39.13 while Freeport-McMoran (FCX) dropped 3.18% to 59.13. US Steel (X) fell 1.43% to 38.55 and Posco (PKX) lowered to 94.32 (-0.55%).

PetroChina (109.73 -0.71%) dipped again, but CNOOC was up (170.17 +0.81%).

Solars Yingli Green Energy (10.18 +3.04%) and Trina Solar (17.28 +0.12%) also bucked the general trend.

ENERGY
US Oil Fund ETF (USO) slid 0.61% to 33.96 and natural gas plays petered out in response. My list of 40 natty gassers dropped 0.83%. Interestingly, Westport Innovations (WPRT), my favorite, gained 1.88% to 15.69. UNG picked up 1.04% to 7.75 and REXX climbed 2.75% to 10.10.

In accordance with crude oil, FSLR dipped 0.52% to 113.83.

In a related clean energy play, Tesla ran wild on its second day of trading only to falter at the finish. TSLA closed at 23.89 on Tuesday, opened at 25.96 today and reached 30.42 before selling off. Shares closed at 23.83 (-0.25%) on volume of 17.1 million shares.

EURO ZONE
FXE gained moderately (0.26%) to 121.87 despite unrest in Greece and more troubles for Spain. Merkel's candidate's victory was good, apparently, for the Euro.

Banco Santander handled the negative news from Moody's well, gaining 2.04% to 10.50. IRE lost 2.37% to 3.29 as austerity measures in Ireland continue to wreak havoc. NBG dropped 2.69% to 2.17, nearing a one-year low.

SAFE PLAYS
GLD (121.68 +0.34%) and SLV (18.21 +0.44%) were nice trades today, as was TLT (101.75 +0.67%).

PROTECTION
ETNs continued to provide shelter to beleaguered longs. FAZ gained big again, adding 3.57% to 17.42. TYP rose 5.48% as tech stocks dipped. BGZ (18.25 +3.22%) and TZA (8.18 +3.41%) were also big winners.

VXX gained 1.33% to 31.20, but didn't exactly trade up while AAPL declined — an unusual lack of coupling that I've seen only twice in the spring and summer. It probably says more about the level of familiarity the general market has with this level of volatility. It's enough to shake out weak longs and conservative traders, but not enough to be truly defined as a panic. Plus, volume is so light. For AAPL to make a higher percentage move than VXX says it all. VXX may have topped near term.

QID (UltraShort QQQ ProShares) did much better, gaining 3.13% to 20.04.

STRANGE BUT TRUE
Shares of CBOE gained 2.49% to 32.55.

DNDN continued its crash, falling 3.75% to 32.33, then losing another 15.47% to 27.33 in afterhours trading. It may be another bear raid on Dendreon shares.

The Centers for Medicare and Medicaid Services posted this online and is seeking public input on the effects of Dendreon's prostate cancer treatment. It seems to be a routine CMS procedure, but shares are tanking nonetheless.

If it's another bear raid without substantial facts and news, this could be another buying opportunity. But I'm staying out and I remain 100% cash in this circus of a market. The elephants are on the loose and I'm staying way up in the bleacher seats.

Tuesday, June 29, 2010

Advantage Disadvantage

Any measurement or indicator of the market has its strengths and weaknesses. Example: trendliners look for a break in direction according to simple lines on a chart. Nothing to do with news or products or catalysts. Example: breakout specialists just want a new high, sometimes buying if there is an increase in volume.

Then there are candlestick chartists. I like candlestick analysis because there's no bottom picking involved. It's been proven effective, though not perfect, for centuries as a measure of market sentiment in individual issues. It's not going to tell you how to handle a white-hot steroid-laden ETN like FAZ, but it can give a forecast of possibility, like any other system.

I'm not a purist of any indicator, but candlesticks are effective as any over the long haul for those who maintain discipline and balance. A combination of news awareness, technical analysis and fundamental analysis are good places to start.

Here's a look at candlestick analysis via American Bulls on some of the stocks I'm watching.

AAPL: "Wait"
BIDU: "Sell Confirmed"
C: "Wait"
CLNE: "Wait"
DNDN: "Sell If"
F: "Wait"
FAS: "Wait"
FAZ: "Hold"
FCX: "Hold"
FXE: "Sell If"
FXI: "Sell Confirmed"
GLD: "Buy If"
GS: "Wait"
IMAX: "Wait"
IRE: "Hold"
JMBA: "Wait"
LULU: "Wait"
NBG: "Buy If"
NFLX: "Sell If"
QQQQ: "Wait"
SLV: "Sell Confirmed"
STD: "Sell Confirmed"
TLT: "Hold"
TZA: "Buy Confirmed"
UNG: "Sell Confirmed"
UUP: "Buy Confirmed"
VXX: "Wait"
WPRT: "Wait"

I like keeping an eye on the pennies — NBG and JMBA — for a good idea of market topping. When pennies explode, we're usually at a top. Note that the only "buy confirmed" issues are conservative plays: TZA (Small cap bear 3x) and UUP (US dollar).

LULU isn't a penny, but when shares are topping out, the market is out of steam. Just look at the history of the stock. It's not a frontrunner by any means, and when shares top out, it's a nasty fall.

This is as bearish as I've seen the candlestick analysis in some time. The market is always about growth, not value, over the long haul. Growth has been stagnant since the enormous climb from the short-term March 2009 bottom came to an end. With China's news today, there isn't a bullish catalyst in sight.

Hail to the bears, at least for now.

Barometer of an Apple tree

Like AAPL at 256? So do I. Doesn't mean I'm taking a bite yet. Look at the 2-year chart if you need facts about the power of the broader market and how a great Apple tree can be bombarded.

AAPL 6-month chart (daily)

AAPL 2-year chart (weekly) vs. S&P 500, QID, VXX

AAPL 1-year chart (daily) vs. S&P 500, QID, VXX

AAPL 10-day chart (15-minute bars) vs. S&P 500, QID, VXX

Q-Man: A Slow Crash

Check out Quint Tatro's expert analysis today at Tickerville.

Tuesday winner: Tesla?

This company has no real revenue, a car company without a manufacturing plant. Fundamentally, this is the king of el stinkos. But a green-energy car maker has a certain attraction to a segment of the investment world. Not me. Even if I were a billionaire, I'd think twice about investing here. Tesla is two years away from hitting stride; part of the reason it went to an IPO today was to raise necessary dollars. During those two years, other automakers like Nissan will unveil electric cars of their own.

Tesla  (TSLA) closed at 23.89 today, up 40.53% from its original price. It opened after 11 am Eastern at 19.00, dipped to 17.54, and rose after that. I'm not crazy enough to play an IPO on a day like today, so to those of you who played TSLA for a nice pickup, kudos.

TSLA 1-day chart (5-minute bars)

TSLA 1-day chart (1-minute bars)

TSLA vs. F, VXX, S&P 500

Bears block party

Holding inverse ETNs, particularly the ultra sort, can be hazardous to one's trading account. Overnight, the readjusting that goes on can swoop in and steal your profits. VXX declined 400,000% in the past year. OK, I'm exaggerating a bit, but it was painful for anyone who dared to buy VXX a year ago and simply hold. It's not a buy-and-hold vehicle and never was intended to be.

Today, though, was a win for bears and ETNs. Here's how the list I compiled a few months back did today:

BGZ +9.32%
DPK +10.28%
DRV +9.58%
DXD +5.24%
DUG +6.22%
EDZ +11.72%
EEV +7.97%
EFU 6.75%
EFZ +3.39%
EPV +7.47%
EUO +1.29%
FAZ +10.48%
FXP +7.96%
LHB +13.97%
QID +7.58%
SDS +6.07%
SKF +7.44%
SMN +8.33%
SRS +6.13%
TMF +3.49%
TWM +7.54$
TYP +10.89%
TZA +11.25%
VXX +9.26%
ZSL +2.73%

The time to commit to these inverses was before today, of course. Getting in now is perilous considering the news today from China, Europe, Venus, the Dark Star and beyond isn't any worse than it has been in the past months. None of it was really unexpected. If the market bounces tomorrow or Thursday (first day of the new quarter), that won't be a shocker.

But keeping a close eye on all these inverse ETNs and the movement is key. Know the pulse before entering.

Terrible Tuesday

Dow Jones 9,870.30 -268.30 -2.65%
NASDAQ 2,135.18 -85.47 -3.85%
S&P 500 1,041.24 -33.33 -3.1%

Did you get bitten today? Did you stay long in this flaky market without protection? Do you walk the streets and let thugs take your hard-earned money? I've been 100% cash for nearly three weeks, but if I were ever to go long, I'd definitely hedge my bets — be honest, everything in the market is a calculated guess — with VXX or FAZ and maybe have some safer plays like GLD and TLT.

TECH KINGS
Apple has its share of complaints over iPhone 4, but they continue to sell, sell, sell what may be the most addictive piece of technology on the planet. Shares, though, bit the dust today, down 4.52% to 256.17. This is an entry price I could love, but even here I want to wait for 250. I'd rather catch this ride on the way up than possibly on the way further down.

So, all the Android devotees who happen to be iPhone haters should be loving Google, but shares dropped 3.77% to 454.26. I like this price, too, but I'm watching from afar.

BIDU fell 9.23% to 67.57 as China did a swan dive. Still the search king of China with the backing of Big Brother. Sub 60 would be compelling.

NFLX closed down 4.28% to 112.58. The swings here are wild and I don't like it long term against the competition that is pounding down the door, like Apple. On that note, IMAX dipped as low as 14.28 before ending the day at 14.88 (-4.43%). Like Netflix, Imax has serious competition coming sooner rather than later.

EURO ZONE
FCX was down only 0.63% (121.56), but craziness across the region (Greek riots, German leadership issue, Spanish unemployment, yadayada) did nothing good for global markets. NBG was flat at 2.23. No banks were burned down. However, IRE dropped 6.91% (3.37).

SAFE PLAYS
GLD closed barely up (121.27 +0.15%) while TLT (20-year Treasury Bond) was up 1.09% to 101.07. TLT has a chance to stay above 100 for awhile. There's no real catalyst coming to the market for the bulls in the visible future.

ENERGY
USO (US Oil Fund ETF) dropped 2.95% to 34.17. BP went the other way, gaining 2.29% to 27.75. Not touching that POS.

Natural gas wilted. UNG caved 3.88% to 7.67. My list of 40 natty gassers got smoked again, dropping 5.27% today. They dipped into the red as a group for the first time since Obama's clean energy speech nearly four weeks ago. That's bad news on bad news. WPRT, which was once the leader with a 30% gain, is now up just 4.83%. PETD still has a sizable gain of 25.83%, but almost everything else is in the red or has a modest single-digit gain. No catalyst, no luck.

First Solar (FLSR) also fell, losing 4.03% to 114.42. One of last week's hotties, Trina Solar (TSL), dripped 5.06% to 17.26.

Chinese energy ate dust today. PetroChina (110.51 -3.45%) and CNOOC (168.80 -4.44%) sank. Whimsical solar play Yingli Green Energy (YGE) lowered to 9.88 (5.64%).

CHINA & HEAVY METAL
FXI tumbled 4.03% to 39.31. Freeport-McMoran (FCX) crumbled 5.55% to 61.07. US Steel (X) gave back 5.87% tp 39.11 and Posco (PKX) gave up 6.22% to 94.84.

PROTECTION
VXX finished with a 9.26% gain to 30.79 after hitting a high of 31.34 in the final hour. Shares were below 25 last week.

FAZ moved big, 10.48% to 16.82. I've had good trades in FAZ before, but haven't touched it in months. Finnies are now just a wee bit too fucking crazy for me to decipher most times.

Staying in 100% cash while insanity prevails on Wall Street. Have fun!

Trading on visuals?

It was a month or two ago when video footage from Greece set VXX shares on a rocket launch from the mid-20s to 30-plus at warp speed. I haven't seen anything today, being that I just got up from bed a half-hour ago. But the photos online are disturbing enough to explain some of the bearish tone.

As always, Business Insider is atop the mountain of that bearish sentiment with these photos of Greek riots getting physical and dangerous. This one looks like a hairdresser getting pissed at a cop who won't agree that her job is truly toxic and she needs to retire at 52 (or whatever their preposterous early retirement age is). Sure, it's a wonder that the Greeks sincerely believe that they're entitled to a certain lifestyle that the rest of the civilized world doesn't have — of course, we all want to retire young — and yet they go about this mess seemingly hippie-style. I'm not encouraging radical action, but this will not last. Armed revolt, this is not. These guys are thinking like the kung fu masters during the Boxer Rebellion. That ended rather quickly. If it gets worse, this is bullets versus human flesh. No contest.

While they're bitching about having to work until age 55 or 65 like the rest of us on Planet Earth, the Greeks are driving much-needed cash right out of the country. Guess they don't need the money. I suppose tourists could return to the Parthenon or whatever. Or come to Hawaii, land of peace and people who aren't rioting in the streets.

I don't plan any trades on Greece, though I might have tried some VXX much earlier today had I not been blissfully asleep.

Photo: AP

Carnage

Dow Jones (-2.38%), Nasdaq (-3.25%) and S&P 500 (-2.71%) flailing away in the dark with less than 2 hours left in the session. Worries about consumer confidence and Euro zone issues have taken precedence again. Issues about domestic financial regulation reform haven't helped, either.

Overall, though, it's nothing new. Just no good news, and the market needed capitulation to the down side. A lot of fund managers and traders are off on vacation this week and closing their books for now as Q2 nears a close, just my guess. So the robots take over in their algorithmic, predatory kind of way.

The past few weeks have been about light volume, no conviction and warning signs. Today, we have carnage.

I was up at 8:14 am Hawaii time and found the market in the red, both feet in. AAPL is finally below 260, my price target for a possible re-entry. Shares are at 257.64 (-3.97%). F is back below 10 (9.91 -4.99%). Jobs and housing declines are a bitch. C, which was saved by circuit breakers at 1pm Eastern, lost momentum and is at 3.79 (-5.25%) and GS (134.26 -1.76%) is sinking.

Even IMAX, that piddly, fickle issue, is at 14.65, lowest I've seen in months, despite huge ticket sales for Toy Story 3. BIDU is down 7.31% to 69.00. NFLX, not so bad, down "only" 2.88% to 114.22.

Meanwhile, VXX (30.13 +6.92%) and FAZ (16.62 +9.16%) are shredding the bulls. I'm still out of this madness and watching from the bleachers, but it's unfathomable to be long this market without hedging with some VXX and other assorted life vests. The ice was very, very thin.

FXI (39.49 -3.59%), FCX (61.39 -3.27%) and US Steel (X, 39.60 -4.69%) declining today as the US Dollar is up (UUP 25.05 +0.36%).

Euro is down slightly, but GLD (121.39 +0.25%) remains healthy. 

Monday, June 28, 2010

Q-Man remains cautious

Though not as cautious as me (100% cash).

No Greek formula in sight

Apparently, they're still pissed as hell in the land of baklava.

From BBC:

The big question is whether the government will try to break the blockade in order to help the tourists, or do nothing, for fear of aggravating the unions during the period of this crucial debate, our correspondent adds.

Mumbles Monday

Dow Jones 10.138.52 -5.29 -0.05%
NASDAQ 2,220.65 -2.83 -0.13%
S&P 500 1,074.57 -2.19 -0.20%

It was an almost perfect correlation, parallel, whatever ... I crashed out at 3 am Hawaii time. Market opened at 3:30. I got up at 9:15 am, 45 minutes before the close. Two months ago, I was up most nights and stayed up through the session. Now, I just enough a great night's rest. Humidity and heat, I can deal with. Rather have 80 degrees and wake up where I am than anywhere else in the world. I don't need to imagine the price and value of that.

As for the market, it's a pile of crap, which is not unusual for this time of year. This week, with Q2 ending on Wednesday, could've been a crazed buying spree by fund managers for window dressing purposes. Instead, it seems even the robots have left the office, packed up the robot wife and robot kids and headed to vacation nirvana.

TECH KINGS
AAPL gained 0.60% to 268.30, off its high on news that 1.7 million iPhone 4s sold over the weekend. That's not including the units that would've been sold if Apple had more in stock. AAPL is trading at the same level now — with all the news about iPads and the new iPhone — that it did on the blockbuster earnings report just 3 months ago. 265-270 was the old high. Now it's the old low.

I want shares at 260 or lower. Won't happen now unless the global market collapses, and that's a real possibility.

BIDU dropped 2.18% to 74.44 and GOOG lost 0.18% to 472.08.

CHINA & HEAVY METAL
FXI lost 0.53% to 40.96 as metals melted down. FCX slipped 2.87% (64.66) and US Steel (X) dropped 3.91% to 41.55. My guess: fund managers took their recent profits, locked them in for Q2 and got ready for vacation.

Recent high flyer PKX gave back 2.3% and fell to 101.13. Not a good start to the week for steelers.

EURO ZONE
FXE declined 0.90% to 122.33 while UUP (US Dollar) gained 0.52% to 24.96. That's a combo that usually spells losses in the US stock market.

FINANCIALS
GS (136.69 -2.15%) pulled back while C (4.00 +1.52%) gained. Banco Santander was flat (11.01 -0.36%). IRE dropped 2.16% to 3.62. For entertainment purposes, NBG lost 0.89% to 2.23. It's awfully hard to feel bullish about a bank in a nation like Greece, where people feel entitled to work 2.2 hours a week and retire from "toxic" jobs like hairdressing at the hearty age of 23 years old. (I kid and exaggerate.)

Maybe when NBG shares dip below 1.50 I'll grab a few.

US ENERGY
USO (US Oil Fund ETF) lost 1.26% to 35.21 while SCO (UltraShort Crude Oil) gained 2.42% (14.19).

A decline in oil gave the natural gas sector reason to resume selling. Just three of my Nat Gas 40 gained today, including CLNE. As a group, they lost 2.08% today. Since Obama's clean-energy speech four weeks ago, the 40 are up only 2.63% now. Former leader WPRT is up 12.32%, but that's a far cry from its 30% gain just two weeks ago.

No catalyst in sight for this industry.

Solar was relatively flat. First Solar (FSLR) was down 0.03% to 119.23. Trina Solar (TSL), a hot mover last week, lost 0.82% and fell to 18.18.

CHINA ENERGY
PetroChina (114.46 -0.56%) and CNOOC (176.64 +0.80%) are interesting in this sense: it is CNOOC (CEO) that has been active because it's in acquisitive mode. Opportunism, i.e. grabbing any piece of BP it can get, has gained the sector's attention.

Solar play Yingli Green Energy lost 1.97% (10.47).

SAFE PLAYS
GLD (121.09 -1.36%) and TLT (99.98 +0.94) went in opposite directions today. TLT (20-year Treasury Bonds) has based here (95-100) since mid-May. Longer the base, bigger the pop. Or drop.

SLV (18.38 -1.55%) gave back some of its recent gains.


HEDGES
VXX collected 1.66% to 28.18. The big move came at 10 am Eastern, and it sold off on news from Capitol Hill regarding the possible failure of the financial reform bill. But VXX still finished with a gain. Bulls on pins and needles. 

FAZ gained 2.85% to 15.23. Holding these two overnight is hazardous.

I've been 100% cash for a few weeks and I'm content to admire the fluidity and success of geniuses of Le Fly and StockGuy22. 

Sunday, June 27, 2010

Forrest/Epps just don't get it

Forrester has already gone on record recently with underwhelming projects for 2010 iPad sales. Now Forrester's Sarah Rotman Epps insists that Apple will sell barely 200,000 iPads per month.

"Jobs may not view the iPad as a PC, but we do," she wrote recently.

Thing is, the iPad is NOT a computer. It's a TOY, and it's quite sad that Epps and a few other insistent fools refuse to factor in FUN as a key ingredient in this evolution in modern technology. It's perfectly fine for any analysts or writer to say that he or she doesn't like Product X. Doesn't mean the rest of Planet Earth hates it, too.

I never cared much for heavy metal, but I wasn't going to lie and say nobody would buy it during the 1980s and '90s. I saw the Dallas Cowboys rip my L.A. Rams apart many times back then, but I wasn't about the claim that the Cowboys were unpopular and sucked just because they weren't my taste or style when it came to pro football.

Forrester and Epps can say and write whatever they like. Their rep is shot and will continue to be pummeled as the rest of the world has all kinds of fun with their toys, including their favorite, the iPad.

I don't even own one, but even I see the great technology and greater ease of use.

Friday, June 25, 2010

Weekend plans

Fun, family and ...

Homework.


Ruppert: Empire will break down

He's been right most of the time. Michael Ruppert talked in Vermont last month about the global economy. He comes across like a doomsayer, but nothing is really shocking. The takeaway? Bullish on oil and gold. Bearish on financials, China real estate. 


See more here.

Energy is future currency, part 2

Frazzled Friday

Dow Jones 10,143.81 -8.99 -0.09%
NASDAQ 2,223.48 +3.07 +0.29%
S&P 500 1,076.76 +3.07 +0.29%

Reform is good, but it is no cure and it clearly isn't the catalyst in itself. Today's session was in the green most of the way, but sold off toward the close and essentially closed flat. Sectors that benefited from today's final financial reform bill work on Capitol Hill were (of course) financials and, you guessed it, Chinese energy.

FINANCIALS
Goldman Sachs gained 4.68% to 139.66, capping a nice move from 133 earlier in the week. The intraday high was 140.90. Citigroup closed at 3.94 (+4.23%) after a spooky descent the past few days.

Big winners were buyers of FAS (22.80 +7.17%).

EURO ZONE
FXE traded up (123.44 +0.47%) while the US Dollar (UUP) lost 0.56% (24.83).

Euro banks benefited from the finreg bill. Banco Santander, like their successful national team, finished up (11.05 +1.66%). IRE (3.70 +1.93%) also rose, though NBG fell (2.25 -1.32%).

CHINA ENERGY
With BP selling off chunks of fine, moneymaking operations, entities like CNOOC (CEO) are swooping in. CEO gained 1.93% to 175.24 while PetroChina (PTR) moved up 0.50% to 115.10.

Chinese solar plays are hot again, probably new festering ground for traders who banked big gains in US natural gas stocks the past few weeks. Trina Solar (TSL) had a big bump of 4.09% to 18.33 after landing a deal with the University of Queensland (Australia).

Yingli Green Energy (YGE) gained 3.89% to 10.68, riding the sector's momentum.

US ENERGY
The rise of crude oil to $78/barrel is helping solar plays back in the US. First Solar (FSLR) picked up 2.04% to 119.26. Solar is still "expensive" in the sense that it can't survive without federal subsidies for the most part. Solar will climb as crude prices rise. As usual.

Nat Gas had its best day in about a week, reviving in a big way. My list of 40 natty gassers gained a cumulative 2.12%. NGS was the biggest gainer (+7.65% to 16.74) and HERO (2.80 +5.66%) was second.

Two of my favorites, WPRT (16.70 +1.83%) and CLNE (15.97 +3.9%) did fine. So did another play I like, HGT (20.59 +3.05%).

The natty gasser with the biggest gain since Obama's speech is PETD (26.99 +29.57%).

As for oil, BP resumed its tumultuous descent, losing 5.98% to 26.92. Again, the sector traded well, having pruned BP from its collective sentiment. US Oil Fund (ETF) gained 3.69% to 35.66.

SAFE PLAYS
GLD gained 1.2% to 122.90 and TLT was slightly up (99.05 +0.41%).

CHINA & HEAVY METAL
FXI gained 1.01% to 41.18. Copper did well; FCX rocketed 4.93% to 66.57. US Steel rose 2.83% to 43.24. Metals have been so productive lately that the relative volatility shouldn't have scared me away.

TECH KINGS
Hibernation time for AAPL longs. Shares sold off again, as expected, losing 0.86% to 266.70. I'm waiting for a chance to snare shares at 260 or maybe 250.

GOOG lost 0.51% to 472.68. Another buying opportunity may be nearing, though I'm not in a rush. Even with AdMob and Android, GOOG is not as appealing to me as AAPL.

BIDU gained 3.12% to 76.10, arguably the best mover in the sector. They have no real competition in China. Big Brother is on its side. Baidu will not be beaten.

All in all, still 100% cash and no plans to change as the weekend begins. Just a few more days before Q2 ends, so window dressing may be in store as fund managers trample over each other to establish positions. Or not. If the market has another crash soon, I'll be ready.

Finreg bear burn

The squeeze is on. Somewhere in the murky language of the Dodd-Frank financial reform bill are a few words that have made banks happy. In other words, the regulation has probably lost a sizable amount of clout. That's bad news for finnie shorts and great news for suffering longs.

FAS is tearing bears up with a 7% gain to 22.79, while FAZ is down 7% to 14.84 after gaining most of this week. GS (139.65 +3.4%) and C (3.93 +4.1%) are enjoying the boost from Capitol Hill.

Feel the Chinese energy

No, it's not about chi or anything feng sui. Chinese energy is up today while the rest of the market is flat.

CNOOC (CEO) is expanding its presence in South America. The company agreed in March to buy a 50% stake in Argentina's Bridas Energy Holdings. Bridas is currently a potential buyer of BP's Pan American Energy (Brazil).

The move by CNOOC isn't a surprise now that BP is raising cash to offset the unprecedented expenses coming as a result of its Deepwater Horizon catastrophe. Shares are up for CNOOC by 2% to 175.59.

Oil and energy aren't the only movers in China. Trina Solar (TSL) has gained 3.92% to 18.30 after agreeing to build a 1.2 MW solar system at the University of Queensland in Australia.

Yingli Green Energy (YGE) is up 3.4% to 10.63 after announcing a deal with DC Power. No dollar amounts were revealed, though.

STP, which was downgraded this week, moved up 1.82% to 9.51 on the bullish news in the sector.

Thursday, June 24, 2010

Getting back up

Quite an interview of hedge fund manager and squash player Victor Niederhoffer by Kathryn Schulz of Slate.
Unfortunately I was so successful for so many years in that particular field that I began to believe in my own success. I thought that because my method worked in markets that I knew about and had quantified, I could apply the same methods to something I didn't know about. 
I think there are causes that led to their disaster and that rather than thinking about the actual minutiae of the downfall, and rather than creating alibis, they should think about the principles that led to their mistakes. And then I think they should let bygones be bygones. Once you've experienced disasters, there's no sense wallowing in misery. You gotta get back in the qualifying tournaments again. 

Banco Santander won't sit still

Yet another reason to like STD. The behemoth Spanish bank is taking a load off Citigroup: $3.2 billion of auto loans.

Energy is future currency?

If you believe Mark Fisher, paper money will have less value and energy will be the trade.

See the video here.

Apple propaganda and problems

On the day of iPhone 4's debut, more, more and more Apple news.

(new) Apple responds to iPhone 4 reception issues Engadget (Joshua Topolsky)
iPhone loses reception when you hold it by the antenna band? Gizmodo
> Includes solutions by users, still no response by Apple
Analyst predicts Verizon iPhone in 2011 eWeek.com (Nicholas Kolakowski)
iPhone 4 review: The best smartphone ever? Fox News (Clayton Morris)
My excellent SIX HOUR iPhone 4 adventure SAI (Dan Frommer)
Video: iPhone 4 is out, complaints are in CNET (Erica Ogg)
New iPhone isn't broken, iOS 4 is SAI (Nick Saint)
Apple iPhone 4 antenna problems confirmed via tests PC Mag (Mark Hachman)
Are you killing iPhone 4 reception with your bare hands? CNET (Jessica Dolcourt)
That iOS 4 reception issue is looking more and more like a software bug Boy Genius Report (Micheal Bettiol)
Yellow spots on iPhone 4 screens could be due to rushed manufacturing SAI (Jay Yarow)
iOS4 upgrade breaks iPhone-to-car stereo connection SAI (Nicholas Carlson)
Yes, if you drop your iPhone 4 several times on asphalt, it will shatter SAI (Nicholas Carlson)
Is HP the Next Apple Motley Fool (Rick Munarriz)


Watch CBS News Videos Online




Russian play?

Russia getting play on Fast Money as its president (Medvedev) visits Silicon Valley en route to the G20 conference. The country wants to diversify rather than be so dependent on exporting energy. They're probably years away from becoming a tech player, but RSX, the Russia ETF, might be worth a look short term. Or not.


Here's a cool story about Medvedev meeting Steve Jobs and receiving an iPhone 4. He visited Apple and Twitter headquarters. He also says Russian tech hub-in-waiting Skolkovo isn't trying to become Silicon Valley.
President Dmitry Medvedev does not think Skolkovo should be an exact replica of Silicon Valley. The idea is to draw on U.S. experience to create an attractive environment for companies to develop high-tech innovations. “No one is going to simply copy Silicon Valley, it is impossible," he said at a meeting with Russians working in California.

Capitol Hill compromise?

Fast Money reporting that the Volcker rule has been "strengthened" ... but it sounds more like a compromise that will allow finnies like Goldman Sachs to retain some ties to hedging. GS moving up a skosh on this news.

Turnover Thursday

Dow Jones 10,152.80 -145.64 -1.41%
NASDAQ 2,217.42 -36.81 -1.63%
S&P 500 1,073.69 -18.35 -1.68%

Regulations, schmegulations. There's no doubt that without turmoil from Capitol Hill, the Eurozone, the Gulf and iPhone 4 buyers planetwide, the market would be just fine and dandy. (RIMM is collapsing after hours due to a so-so earnings report.)

The pullback was expected from a technical perspective. Is a further drop coming? With Q2 coming to a lose in less than a week, I'm not so sure fund managers will stay completely out. If they get scared and refuse to dip their toes back into the oil-infested waters, that'll be a surprise to some extent.

I'll still wait for selling pressure in AAPL to wane before I walk into that territory. To the brave who grabbed VXX shares below 25 and 26 recently, bravo. When AAPL draws down, VXX pops 99% of the time.

Overall, though, the market was simply red.

TECH KINGS
AAPL wavered between 269 and 272 on the day of its iPhone 4 release. Shares closed at 269.69, down 0.73%, or 10 bucks less than its all-time high last week. Signal issues with the new phone could sit on AAPL for a few days, which makes it a buying opportunity, maybe. I'd rather just wait.

GOOG petered out and lost 1.44% to 475.10. Entry point is looking better all the time now. I might just wait for the first report of mobile ad sales before I test Google waters.

BIDU lost 3.14% to 73.80 after beating down bears for several days.

FINANCIALS
GS (134.98 -0.07%) and C (3.78 -2.83%) facing issues thanks to legislators. I haven't liked finnies for months precisely because of this kind of uphill battle. Fuck it. Too much work, too much pain involved. Unless GS hits 100 and C swoons to 3.00. Then I won't resist.

EURO ZONE
FXE up 0.14% (122.86), which normally is good for the US market. UUP (US dollar) was flat at 28.35.

Euro banks fell in spectacular fashion. Banco Santander (STD) dropped 3.81% to 10.87, IRE got squashed (3.63 -8.1%) and NBG (2.28 -3.8%) took a blow to the scrotum. I like STD below 9. Could happen. STD was below 9 less than two weeks ago.

SAFE PLAYS
Predictably, GLD (121.30 +0.29%) was up in a down market. So was SLV (18.26 +0.44). TLT, surprisingly, fell 0.59% to 98.65. But TLT had been hot lately, so it's not a shock.

ENERGY
US Oil (USO) gained 0.44% to 34.39 despite BP's plummet. BP gave back 3.14% to a new low of 28.74.

Nat Gas continued to fart incessantly. Only two of the 40 on my list closed positive today, though FTK had a nice 5.26% gain. As crude oil prices gain with greater demand, natural gas needs a definitive catalyst from the White House, something more than oral salutations from President Obama. Otherwise, nat gas is looking dead.

WPRT, once the beacon of the post-Obama clean-energy speech explosion, lost big again. Shares tumbled 3.81% to 16.40, and now WPRT is up only 11.64% since Obama's speech. WPRT had been up more than 30% at one point.

There are arguments to every sector of alternative energy. Wind has opponents because turbines kill thousands of birds. Solar has issues because of cost and the way certain endangered bugs (I'm not kidding) are instinctively attracted to panels and essentially fly until dead. The reasons are innumerable, surely "discovered" by pro-oil interests as well as well-meaning environmentalists.

Come on, people. We've got to do more than bitch and moan. Solutions?

HEDGES
VXX rocketed 6.14% to 28.35 and FAZ leaped 6.11% to 15.97. They're both explosive and both good ways to protect against losses if you're long the market, whether it's AAPL or financials.

Or you could just sit out and watch the circus from the bleachers like I have. Still 100% cash.

Schwarz takes his swings at Soros

At some point, the uber-bears will be right and the preachy bulls will be wrong. Or will it be the other way around? Apple devotee Jason Schwarz explains why "Grandpa" George Soros is so wrong about the impending doom of modern civilization.

How 'bout them Apples

So far ...

• The jobs report was released at 8:30 am Eastern (2:30 Hawaii) and was relatively positive. AAPL, which had traded above 269, moved up to 270 and continued to move, lifting above 272 in premarket trading.

• After the opening bell, with the market down, AAPL opened at 271.12, sold down below 271, then racheted up. Shares hit 273.19 just seven minutes after the bell.

• AAPL then sold off quickly, down to 269.66 and was poised to join the rest of the market, which has shown overbought signs for a few days now.

• Since fluctuating in the 270.00-270.40 range, AAPL rose back up to 272. It seems like an even tussle between bulls and bears as AAPL moves along with the stochastics and MACD.

Though the Dow (-77), NASDAQ (-21) and S&P (-9.71) remain negative, AAPL's iPhone 4 release today, plus the customary live TV coverage of the hordes camping out at Apple Stores, seems to be working in its favor. Instead of a sell-on-the-event decline, AAPL is holding its ground to an extent.

I'm still willing to wait until AAPL sells off with the rest of the market. If I can re-enter a position below 260, fantastic. 250 would be better.

Wednesday, June 23, 2010

AAPL up, BIDU upper, GOOG not so up

So, Apple unveils* its iPhone 4G in mere hours and Planet Earth will (mostly) rejoice. Don't lie. If if you hate Apple, you'd probably keep an iPhone 4 if someone gave it to you as a gift. So would I.

It's interesting that Google's move into smartphones (Android) and mobile advertising (via AdMob) hasn't particularly helped the stock as much as it should have. Or maybe there just aren't as many believers, being that the mobile ad business is still in its infancy. But more pertinent was Google's decision to depart from China. The charts below show how potent BIDU shares have been and continue to be. With the FXI bolstered lately, rising ahead of the US market and showing its force as a premier leader, BIDU simply rises higher and higher.

AAPL vs. BIDU vs. GOOG (1-year chart, daily)

AAPL vs. BIDU vs. GOOG (6-month chart, daily)

AAPL vs. BIDU vs. GOOG (2-month chart, daily)

AAPL vs. BIDU vs. GOOG (10-day chart, 15-minute bars)

AAPL 6-month chart
Candlestick analysis: Sell Confirmed (American Bulls)

GOOG 6-month chart
Candlestick analysis: Hold (American Bulls)

BIDU 6-month chart
Candlestick analysis: Buy If (American Bulls)

Clean energy lacks backers

This Minyanville piece explains the viewpoint of one academian who sees no real substance in short-term changes toward clean energy.

Not a bad piece, but can journalists please get more focused and bring us viewpoints of clean energy movers with real answers? I'm tired of constant skepticism without concrete, constructive solutions. Is there really no creative way for the US to move forward, away from dependence on crude oil?

Bearish echo

Who is Richard Russell and why does he keep hollering about an imminent crash?

He makes quite a point about John Paulson loading up on gold and gold-related vehicles.

One of the greatest modern traders, John Paulson, who made billions on the housing collapse, has, I understand, all his personal money in gold-related items. Many of my subscribers have now built gold profits beyond anything they have ever achieved before. I know at this point one could get itchy fingers thinking of the profits achievable by switching gold for fiat currency. I warn subscribers, stay on the yellow brick road. The big profits, the astounding profits, will accrue when gold finally bursts loose of its prejudices and freely expresses itself.

Right or wrong, note that Russell refers to hard gold, or whatever you term it. ETF gold, i.e. GLD, has its inherent risk — seizable by the Fed in an inhospitable economic climate.

Alibaba is Brand #1?

Really? I don't believe it and you probably don't, either. Credit Suisse, however, has its own list of 27 global brand kings, and Alibaba is at the top of the list, followed by Amazon, Almarai, Apple and BIM.

The Thurston Howell III play

It is possible that while most of Planet Earth crumbles, the elite rich and powerful will enjoy their truffles and Coach bags more than ever. You and I could bother to cash in on their bootyful ways through this ridiculous new (?) ETF known as ROB.

Room for big, fat smartphones?

So really, do people want a 4.3-inch screen? I am not in the smartphone universe, so I really have no feel for this, but if people are turned off by Apple's closed system and already like what Google/Droid/Verizon/Motorola have to offer ...

What traction does the Droid X have?

The anticipated phone, which has an 8-megapixel camera and HD videorecording, will sell at Verizon Wireless stores and online beginning July 15. It will cost $199.99 after a $100 mail-in rebate, provided the buyer agrees to a 2-year service agreement. (Buyers will have to pay $299.99 up front, then wait to be mailed the debit card containing their $100 rebate.)

The Good Doc

Howard Lindzon with Dr. J (Jon Najarian).

Krullster the not-self-important

First, Krullster explains to an intrusive e-mailer that there is no "self importance" going on.



Here, offspring of Krullster with an important message to BP.



Video: Hit The Bid

What's hot, what's not

A candlestick update from American Bulls.

AAPL (270.97): "Sell Confirmed"
BIDU (76.19): "Buy If"
C (3.89): "Sell Confirmed"
CLNE (16.17): "Wait"
FAZ (15.05): "Hold"
FCX (65.06): "Hold"
FXE (122.69): "Buy If"
FXI (41.26): "Hold"
GLD (120.95): "Hold"
GLDD (6.14): "Wait"
GOOG (482.05): "Hold"
GS (135.07): "Wait"
LVS (27.04): "Hold"
PKX (105.14): "Sell If"
SBUX (27.32): "Buy If"
SCO (15.06): "Hold"
SD (6.25): "Wait"
SLV (18.18): "Buy If"
STD (11.30): "Buy If"
TLT (99.24): "Hold"
UUP (24.97): "Sell If"
VXX (26.71): "Sell If"
WPRT (17.05): "Wait"
X (44.06): "Buy If"

Apple propaganda

Delay? What delay? Any delay regarding Apple and AT&T has been treated as a mini-catalyst. For every story about iPhone flaws, there are the huddled masses gathering at Apple stores to pick up their spanking new 4Gees.

I've never owned an iPhone, iPad or even iPod, but that makes me no less an afficianado for information about Apple. Though shares could plummet back to its two-year low of 78 in a global meltdown, products would be no less cool and hot. Even with the two-day pullback, AAPL is in the red zone at 270.

I remain 100% cash in this thoroughly manipulated and acidic environment. Maybe it's finally time to get a toy for myself. Me and an iPad. Wow, that's too much. I'm salivating. No. Not really.

Some of these reports are a week old. Hey, I'm catching up.

Camping out at the Apple Store for cash Fortune (Philip Elmer-DeWitt)
New iPhone arrives; rivals, beware New York Times (David Pogue)
Apple confirms white iPhone 4 delay until mid-July Gadget Review (Chris Gullo)
(new) Those iPhone 4 lines could get ugly CNET (Caroline McCarthy)
Team Droid X: the anti-Apple? Fortune (Stephanie N. Mehta)
(new) Verizon keeps unlimited data for new Droid X CNET (Marguerite Reardon)
Google: 160,000 Android activations per day Fortune (Seth Weintraub)
Analysts scramble to raise AAPL targets Fortune (Philip Elmer-DeWitt)
App Store: 1% of Apple's gross profit Fortune (Philip Elmer-DeWitt)
The iPad at The Plaza Fortune (Philip Elmer-DeWitt)
Apple's iPhone 4: The reviews are in Ethiopian Review
Video: AT&T stops iPhone 4 preorders after day of frenzy Dallas Morning News
Lines form for the new iPhone in New York and Tokyo (Fortune (Philip Elmer-DeWitt)
What's driving iPhone 4 sales? Fortune (Philip Elmer-DeWitt)

Wax Off Wednesday

Dow Jones 10,298.44 +4.92 +0.05%
NASDAQ 2,254.23 -7.57 -0.33%
S&P 500 1,092.04 -3.27 -0.30%

Nothing like wiping the slate no matter what the baggage or overload may have been. Lessons are much better learned by remembering what was fundamentally wrong, no doubt, but letting go and starting over are mandatory. Every sports fan has a last-to-first story to remember.

With today's drastic statistics in housing data, plus a market that was overbought, a decline is unavoidable in the market. AAPL is not the only barometer, but it's true that when it can't hold gains after a nice run, it's likely to drop and/or consolidate again. We've seen AAPL trade between 231 and 279 in the past month or two, and for a moment or two last week, it appeared AAPL was ready to break out in spectacular fashion. But even the news of 3 million iPads sold couldn't push AAPL higher and shares closed down today at 270. For traders, a ride from 273 down to 267 to 274 was plenty of opportunity today. For investors, a pause to recalibrate and consider new strategy.

I don't know for sure, but if you bought at the two-year bottom and held, it's got to be tough changing the plan after riding AAPL from 78 to 279.

Another puzzler is GLDD, which was poised to build barriers off the shores of Gulf states, only to see the Fed pull the plug on that plan. According to this report, concerns about endangered areas will require sand berms to move further out to sea by two miles. How much this affects GLDD, I don't know. Shares finished up 0.33% to 6.14. Still bears watching, no pun intended.

FINANCIALS
Banco Santander gained a few pesos (0.44%) to 11.30 and continued upward in afterhours trading (11.42). IRE gained 1.8% to 3.95, but most finnies were down. GS was up 0.21% (135.07), but C (3.89 -1.27%) and NBG 2.37 (-1.66%) struggled.

There's a lot to like about STD, but it's been a significant gain since it traded below 9 three weeks ago.

CHINA & HEAVY METAL
FXI gained 0.76% to 41.26, though FCX (65.06 -0.20%) traded lower. US Steel (X) gained 1.08% (44.06) and BIDU finished higher (76.19 +0.67%).

Between rising labor costs and Big Brother's iron fist, this is an amazing spectacle. Workers in the People's Republic are more informed than ever. They understand China's status in the economic universe. They want a piece of the pie and they'll get some of it as wages increase across the Middle Kingdom gradually.

Posco (PKX) of South Korea gained 2.77% to 105.14, following X's lead. Or vice-versa.

EURO
FXE gained a fraction (0.25%) to 122.69. The US dollar (UUP) dropped 0.40% to 24.97.

SAFE PLAYS
GLD lost 0.41% to 120.95 and SLV dropped 1.3% to 18.18. TLT gained 0.68% to 99.24.

ENERGY
SCO (inverse oil ETN) picked up 4.95% to 15.06 as US Oil Fund (USO) gave up 2.17% to 35.24. BP, really, doesn't trade like the rest of the sector anymore. It trades like an outcasted entity drifting in space. Shares dropped just one penny to 29.67 after sitting above 30 earlier in the day.

Only eight of my Nat Gas 40 managed gains today. DPTR, a penny stock, picked up 3.09% to 1.00. KOG rose 2.05% to 3.48. The group as a whole lost 1% and is now up just 4.85% since Obama's clean energy speech nearly three weeks ago.

PETD, which was up today 1.2%, is the overall leader with a 25.2% gain. Former leader WPRT is up just 16.07% following a massive selloff the past few sessions. Westport was up more than 30% at one time.

The initial rally, post-Obama, was tremendous, and his follow-up comments early last week helped, but the sector needed something substantial, something with legs to stand on. That catalyst has not happened and shares have sold off to no surprise. Compounding the risk was Pennsylvania's legislative call to ban natural gas production in wake of some recent disasters.

Still, this could be the beginning of a new opportunity to enter clean energy, but I suspect the market is ready to balance out. I'll wait for WPRT to pull back to 16 before I consider a small position.

ETN SAFETY
VXX dipped below 25 last week, and the candlestick analysis (American Bulls) called for a buy (25.48). Very solid perspective; VXX has been strong after falling to these levels in recent months. Shares closed at 26.71 after an intraday high of 27.74. Shares ran up again in afterhours trading to 26.92, but I'm skeptical of that price holding overnight. Often, VXX readjusts before morning trading and can be bought cheaper.

Nice gainers among ETNs include DTO (75.33 +4.85%), DUG (65.55 +2.01%) and TYP (8.21 +1.23%).

Spin class

Up and about here in the islands for the past hour or so. It's now 9 am Hawaii time. One hour left in the session and things are looking up despite a horrid start. AAPL sold down to 267 before rallying to 272 in the last few hours. Impressive. The FOMC is helping, but how much can it do to prevent a downside dip?

The final hour should be interesting. Housing numbers are horrid, so who wins the battle between the bulls and the bears. I've got some catching up to do starting with the Q-Man. Here's his take on the market after yesterday's close.

Business Insider is never exactly a sunny place to be, but is there any way to spin BP's latest bungle in a positive light? Robots accidentally making the situation worse? Nope. Supposedly, this has nothing to do with the deaths of two people on the cleanup crew.

Not to mention how it's raining oil now on shore. Maybe BP will buy that oil back from Louisiana residents. I wouldn't put it past them.

Tuesday, June 22, 2010

Tepid Tuesday

Dow Jones 10,293.52 -148.89 -1.43%
NASDAQ 2,261.80 -27.29 -1.19%
S&P 500 1,095.31 -17.89 -1.61%

I'll say it again: this is a market that can have traders sprinting on those mouse wheels like a treadmill all morning and afternoon. It can also be an opportunity to shut the computer down, take a ride and enjoy some sunshine and pristine waters at the local beach. In my case, there are many choices. An hour just chilling in the water under a hot Hawaiian sun and some cool trade winds was the perfect tonic for my day.

I missed AAPL's rebound today as the news of 3 million iPads sold carried over. But I didn't miss another early gain and later decline. Volume is so light at this time of year and my time off is so limited, there are simple choices for those of us in the middle of the Pacific during the hours of 2 am to 2 pm.

1. Sleep, hit the beach, relax.
2. Sleep, wake up every few hours, check the market, back to sleep.
3. Watch every tick for 12 hours straight.

I prefer 1 and 2 for the rest of this month. I'll be on the lookout for AAPL shares below 260, maybe 250. The last two lows were 231 and 242. Expecting another low below 250 would be expecting a bit too much, I believe. But AAPL has proven that it will consolidate for months before exploding again, and we're in the midst of that now, possibly.

Fund managers don't want to be out of AAPL as Q2 closes at the end of this month. But they'll be more than happy to shake out weak hands and grab all they can below 260 or 250. So I wait.

TECH KINGS
AAPL gained 1.36% to 273.85. It's a dangerous scenario, potentially. There are traders who want their small gains on a daily basis. There are longs who wisely have held since 78 last year (March 2009). If the global economy tanks, everyone gets washed out to sea without mercy. Caution advised.

GOOG fell just a bit (-0.47%) to 486.96. Is this the opportunity to jump in before the Google train leaves the station? Or is a ledge below the cliff, and there's nowhere to go but down? I don't know. I'm asking you.

CHINA & HEAVY METAL
BIDU couldn't buck the trend for a second day in a row and lost 0.89% to 75.68. The FXI lost 1.56% to 40.95, giving back a small portion of recent gains. FCX lost 4.25% to 65.19 and US Steel (X) dropped 3.07% to 43.59.

It's a short-term trader's paradise.

EURO
The FXE lost just 0.33% (122.38) while the US dollar (UUP) was up 0.16% to 25.07.

FINANCIALS
Stateside, Goldman Sachs lost 2.14% to 134.79 and C dropped 1.99% to 3.94. Abroad, Santander (STD) lost 1.83% to 11.25, IRE got smacked (3.88 -7.18%) and NBG slipped 2.03% to 2.41.

FAZ fed off the selloff and gained 4.92% to 14.92.

ENERGY
If all of this felt vaguely bearish or even bullish in your optimistic view, try this: All 40 of the stocks on my Nat Gas list finished in the red today, a first since Obama's clean energy speech 19 days ago. Red, red, red. There's just sorta exception in VNR, which broke even for the day.

If the Nat Gas sector, which has an edge over most, can't get positive, it might be a setback for the broader market. Sure, Gulf drillers may have gotten a reprieve today, but for how long? Does the State of Louisiana really think it can win against the President? Do we really need for all drillers to go back to work in the Gulf? There has to be a reasonable compromise that can keep workers employed without risking one or two more preposterous catastrophes.

USO (United States Oil Fund ETF) finished down 0.93% even with the Louisiana challenge. Meanwhile, the ultra-short oil ETF, SCO, gained 1.7% to 14.35, oddly enough.

SAFETY
VXX gained again, this time 1.01% to 26.49 and making those who entered below 25 geniuses.

FAZ was far from the only inverse ETN to gain nicely today. DRV (Direxion Daily Real Estate Bear 3x) gained 9.74% to 6.87.

TZA (Direxion Daily Small Cap Bear 3x) ran up 6.29% to 6.97.

GLD reversed recent downward momentum and gained 0.88% to close at 121.45. TLT gained 1.19% to 98.57.

All in all, some interesting viewing from the bleachers. It might not be the worst time to pair AAPL and VXX, since there's no guarantee whatsoever of direction for either. But I'm not interested in that kind of excitement for now.

Monday, June 21, 2010

BVF a winner for the nimble

Biovail. Never heard of it. Not until earlier today. Premarket, news came out about Biovail merging with something called Valeant Pharma. Valeant would keep its name while Biovail got a 15% premium.

Biovail (BVF), which closed yesterday at 14.60, opened at 15.61. I remember it trading at 15.30 or so in premarket. I remembered way back when Chrysler merged with Daimler. That was some crazy, good action for traders. But being sleepy at 3 am Hawaii time, I put my head on a pillow and crashed out.

BVF closed just one cent off its high at 16.67, up 14.18% for the day and concluding its move to the aforementioned premium. It traded 26.7 million shares, well above its average of 1.8 million. Slightly remarkable considering the all-day fade for the rest of the market. I never felt comfortable with the idea of trading something I'd never heard of, not that it stops a lot of traders. I'm content, but it's worth noting that this stock moved more than 6% after it opened. A buy then with a trailing stop might have worked. Maybe not. Shares went from the 15.61 open to over 16.50 just 30 minutes after the open, then sold back down below 16 before making a gradual ascent to the close.

The ship has passed. Congrats to BVF traders.

BVF 1-day chart (5-minute bars)

Here's today's chart on American Italian Pasta Company (IAPC), which accepted a buyout from Raycorp with a 27% premium. Unlike BVF, though, there was no chance after the open to pickup shares for a quickie profit. It was already at 52.63, a 26% premium. 

IAPC 1-day chart (5-minute bars)

Can Kevin Costner save BP?

Kevin Costner's oil-separation technology company has 32 orders for its righteous machines. Maybe they'll work. Does BP want to be saved? Don't they realize they can just "billion" the world many times over now that crude oil prices are rising again?




OK, Costner has a point. But seriously ...

Post-June expry

Odds are ... to the down side after another June expirations week, according to Anthony Mirhaydari.

Wow, kids, a cartoon!

The European Central Bank has so wowed the world by producing this educational cartoon about the perils evils of the Inflation Monster.

Run, kids ... run!

Manic Monday

Dow Jones 10,442.41 -8.23 -0.08% chart
NASDAQ 2,289.09 -20.71 -0.90% chart
S&P 500 1,113.20 -4.31 -0.39% chart

Another good night's sleep. Away from the home office, just enjoying family time over the weekend and through the early part of this week. Seems that the market had quite the day, rolling higher on China/yuan news, then completely selling the bulls out. As David Byrne once bellowed, "This is not my beautiful house! This is not my beautiful wife!"

Whether the Chinese are being facetious or factual is beside the point. The market was quite overbought and all the ripe fruit had to be plucked at some point. I slept right through most of it and slept well. Seeing CNBC (on mute) post charts at about 6 am Hawaii time showing the market 's steep decline from the early gains was no surprise. I went right back to sleep in a quiet neighborhood (not mine, which is noisy most of the day and night) and relished the trade winds coming down the slope.

There are just too many uncertainties and too many certain negatives around the globe for me to trust any whiff of irrational exuberance. That's right, in the right circumstance, I'd go long a frothy, bullish and silly trend. But this ain't it.

I'd rather be picky and catch a chunk of the up side (or down side) than try and guess a bottom or top. There's no reason to allow the market to have an edge on me. It gives us a direction, then maybe I re-enter. Aside from that, there's a lot of fun under the sun to be had. Summer is here.

TECH KINGS
Did AAPL just hit the wall? Shares were up nicely in premarket, hitting 278-plus, and later hit 279.01 before traders banked their nice profits. AAPL was at 242 less than two weeks ago. Closed today at 270.17, not too bad considering it fell to an intraday low of 268.73.

There's still more than a week left before Q2 ends, so more selling by fund managers will allow for another cheap entry at some point. I missed this run, but I didn't really "miss" it. I'm not feeling hurt. I'll just wait.

GOOG lost 2.29% and closed at 488.56. I like sub-490 as a possible entry point. I still like what they have in growth with Android and AdMob. You and I may not like Google as much as Apple, but they still draw billions of eyeballs and are about to corner the burgeoning mobile ad industry. With Apple, of course.

BIDU lost some gains, but still finished up 3.06% to 76.83 on the bullish China news. I've always believed that Baidu is simply Big Brother's baby. Even Mao would be cheering for these home boys to win — extreme filters provided, naturally.

CHINA & HEAVY METAL
It's time for a new band called China to invigorate the stagnant music industry. They could name all their songs after metals and chirp about the beauty of destroying perfectly fine agricultural regions by building dams.

FXI up 2.31% to 41.60. This ETF has held up well despite global poo-poo and will probably find its way to 50 before summer's done. The Chinese hold all the cards and they know it. The real estate bubble is a serious thorn in China's side, but they're managing it better, it seems, than the US handled its subprime mortgage issue.

FCX gained 3.31% to 68.08 as copper regained momentum on China's news. US Steel (X), which had floundered mightily lately, picked up 3.59% to 44.97.

South Korean steel manufacturer Posco (PKX) was a huge gainer, running up 6.69% to 103.76.

FINANCIALS & EURO
GS was flat (-0.32%) at 137.74 after losing early gains. C flat, too, gaining 0.25% to 4.02.

FXE (Euro) dropped a bit (-0.47%) to 122.78 while the US dollar (UUP) gained 0.36% to 25.03. Euro banks closed weakly: STD (11.46 -0.61%), IRE (4.18 -2.79%), through NBG gained 2.07% to 2.46 after a huge gap up.

Not touching these finnies for a long, long time.

ENTERTAINMENT
IMAX gained 1.94% to 16.46 after a huge opening weekend for Toy Story 3. Shares were up to 16.79 before losing ground.
CSTR plummeted 3.25% to 47.36.

ENERGY
BP sold off 4.5% to 30.33 as CEO Hayward did his jolly best to fuck his company again. It's not just that millionaires and billionaires should step away from the spotlight after causing an environmental disaster. It's just that they might think about heeding PR's advice about not cavorting around on a yacht. That fact that he didn't give a fucking damn about his own company's advice, plus the fact that it seems he doesn't care about the oil 'volcano', tells us that maybe there really is nothing BP can do to halt this catastrophe in the Gulf ... what else are shareholders supposed to think? Of course, they're going to bail and bail and bail.

Despite Hayward's idiocy, USO lost only 0.23% today. Inverse oil ETN SCO gained just 0.50%. Oil prices keep going up, which is good news for the industry and even BP.

Meanwhile, only six of the 40 on my Nat Gas list were positive today, and most of the positives were up fractionally. Only BRNC had a substantial gain (+2.36% to 4.34), resuming its hot run. As a group, my Nat Gas 40 lost 1.36% today, but is still up 10.66% since Obama's clean energy speech 2 1/2 weeks ago.

Top gainers on the list:
1. PQ 8.34 (+34.08%)
2. PETD 26.77 (+28.52%)
3. BRNC 4.34 (+24.71%)
4. WPRT 18.22 (+24.03%)
5. MMR 65.29 (+22.35%)

Conspiracy or not, as long as oil goes up, the need for alternatives rides along with that. The clamor for nat gas (subsidy bill pending) and solar will climb. Maybe owning nat gas and/or solar and/or USO are simply ways to hedge against your growing gasoline bill.

I just like WPRT for its great balance sheet and unique position in the industry.

SAFE PLAYS
GLD lost 1.99% to 120.39 today and SLV dropped 2.24% to 18.32. TLT was flat (97.41 -0.29%).

PROTECTION
And, finally, FAZ was up a bit (14.22 +0.57) while VXX soared (25.48 +1.64%). VXX was low as 24.03. The last time it was this low, it made a run to the mid-30s. Is the world a calmer place now than it was last month or six months ago? Again, I won't touch the VXXen unless I'm using it to hedge a long position. The times I've attempted to trade VXX as a stand-alone, she was way too smart and whirling dervish for me. I admit that.