Tuesday, August 2, 2011

So ... now what?

11:47 am (Hawaii) Just a look at some ideas, possibilities for tomorrow and the rest of the week.

• A lot of big, fat companies are sitting on big, fat cash. Is this when they start to buy back stock en masse? Or are they anticipating a market meltdown through the end of the year? Would you buy these stocks at these levels?

AAPL 389
AMZN 211
BIDU 153
GOOG 593
LULU 59.10
NFLX 256

I can't imagine touching any of these here, even after the post-earnings pullbacks. I still love AAPL, but you know 50-dollar swings are the norm between catalysts. AAPL could return and retest 376 (pre-earnings price). BIDU would also be interesting at a cheaper price. Not touching NFLX or LULU. No way.

Playing the downside:

FAZ 53.22
QID 51.45
TZA 42.23
TVIX 22.70
VXX 24.37
ZSL 12.91

I liked FAZ in the 40s but didn't have the nuggets to step in last week. If it pulls back below 50, I'm looking. ZSL I threw in here only because spot silver is always subject to puppeteering by the CME mafia. But now's not the time, not with the possibility of elephants stepping in for the parade higher.

TZA, TVIX and VXX are off my menu. TVIX (+17%) and TZA (+10%) were up huge today. Too hot and due for a drop. QID is interesting now that the techs are almost done with earnings reports.

What's going to stay hot in a cold market? These were hot today in metals.

AGQ 222
DGP 56.60
EXK 10.22
GPL 3.67
GSS 2.70
GORO 26.49

I don't plan to add more mining shares, period. I'd rather play the ultra bull metal ETFs like DGP and AGQ when the timing is right. I'm prepared to acknowledge that it may be too late to pile back on the gold and silver express trains. I might have to be content with small positions in DGP and XG.

Note: Brian Kelly's "first trade" tomorrow is SLV, he says. There are nearly 20 silver plays that were up at least 3% on my Metals list today. That's unprecedented. In all, almost all of the 30 that were up at least 1.5% were silver plays. The Metals list was only 56% green; MCP, REE and AVL were among the bottom dwellers. Silver and gold left the other commodities far behind.

Note #2: Take a look at AGQ at the end of March. Traded from 225.95 (opening price, Mar 24) down to 217.75 (close, Mar 29). AGQ was down three times in a span of four sessions. From there, volume was up on that fifth session, starting a steady ascent to 382 by Apr 28. Then the astounding fall caused by the CME mafia's five margin requirement hikes in nine days.

In the four sessions prior to today, AGQ was down three times, dropping from 229.22 to 206.30. Today, volume was up. It's just something to note, and with a different tone and footing to the silver market, I hardly expect a one-month run to 382. But also note that the RSI crossed over with the slow stochastic during this period, just as it did in late March. Both scenarios followed months-long spans of consolidation. Unlike the springtime run, the market is teetering and on the verge of collapse this time. Does that create a more bullish environment for gold and silver?

No comments: