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February 13, 2007
Cara’s Daytrader Bull Board, Tues., Feb. 13, 2007, 7:58 AM
Other than a few bright lights in the chemicals (DOW and LYO for example), yesterday was a negative day for stocks pretty much all around the world. Today, there are more positive signs, but the big story so far is the -2.24 pct loss in Hong Kong’s Hang Seng index.
Big news will likely come from Germany on Wednesday. German newspaper Frankfurter Allgemeine Sonntagszeitung and Deutsche Bank have indicated that DaimlerChrysler (DCX) may do a spin-off of the unprofitable Chrysler unit. A restructuring plan is expected tomorrow.
Merrill Lynch has re-rated General Motors (GM) from Sell to Buy, by-passing the Stop/Go sign. They also no longer care for the prospects at Ford (F). There will be a lot written today about the automakers formerly known as the “Big Three”.
We’re still waiting to see what Cara 100 drug-maker Bristol-Meyer Squibb and French firm Sanofi-Aventis decide to do with regard to a potential combination.
Also in the Cara 100 healthcare arena, Johnson & Johnson (JNJ) appears to be in some difficulty regarding improper payments. Dow Jones Newswires has reported:
"Johnson & Johnson told the Department of Justice and the SEC that some of its subsidiaries outside the US are believed to have made improper payments connected with the sale of medical devices in two small-market countries. Also, Michael Dormer retired as worldwide chairman, medical devices & diagnostics, effective immediately. In a statement, Dormer said he had "ultimate responsibility by virtue of my position" for the subsidiaries that were involved with the improper payments. The payments may fall within the jurisdiction of the Foreign Corrupt Practices Act, J&J said.”
Now that (Cara 100) Nike (NKE) stock has been running hard, Credit Suisse has increased the 12-month Price Target to $125 from $110. Management has made some very enthusiastic forecasts.
Interesting that after Torontonian Pierre Lassonde (Montreal actually but let’s not quibble) decided to leave Newmont (NEM) as Pres and COO, to return home, so too has Chairman Seymour Schulich, another Torontonian, decided to not stand again for the Board of Directors. Ages catches up to all of us, but maybe the company itself is getting long in the tooth and it’s time for me to replace it on the Cara 100? I’ll definitely make a decision at PDAC March 4-7. There are several precious metal miners that fit the bill (no pun intended, but not a bad one actually).
A new uranium giant has been created after SRX Uranium of Toronto has plans to acquire Vancouver-based UrAsia Energy. The new company will have the second most production of uranium to Canada’s Cameco Corp (CCJ), a Cara 100. This is an important story.
Interactive links
Today, there is the important US international trade data being reported at 8:30am.
I believe that all government data should be reported by a separate statistics agency that is under the control of the Auditor General. The public has lost the trust and confidence in the economic data produced by the Administration, which has an axe to grind. There needs to be much more science and less "art" involved. And there must be total secrecy. The public deserves better than what it gets today.
The Hong Kong stock market must be watched carefully.
Yesterday I did an article about India. Today I will add to that blog entry, but I also wanted to point out that the lacklustre performance of the India Fund (IFN) may not have taken into consideration the distributions. I’ll check that. In any event, I have opined that India will be the most exciting stock market of the next five years based on solid +9 pct annual growth in the economy (and over +11 pct growth in services and manufacturing).
Mixed.
The $USD has weakened a bit in recent hours.
U.S. Treasury Bond Mar. contract
The Crude Oil contracts have gained about 50 cents since 4:30am ET (ie, about 3 hours).
Gold has moved higher by about $4 since 2:30am ET (ie, about 5 hours).
Silver has gained about 16 cents since 2:30am ET.
Platinum has softened in the past four hours.
Palladium has firm a little early this morning.
Here are the current Cara 100 RSI-7 values, sorted by highest and lowest, first by Daily values and then by Monthly, prepared by “David”.
Interactive link to unsmoothed Monday Daily RSI-7 >70 in Cara 100 (down to 7)
The upward momentum was taken out of this market last Friday afternoon. Again, we have to watch to see if the sell-off continues.
If you are a buyer, clearly of the Cara 100 stocks, Starbucks (SBUX), Micron Technology (MU), HSB C Bank (HBC), Votorantim Celulose (VCP), Whole Foods Markets (WFMI), Dell (DELL), Linear Technologies (LLTC). SanDisk (SNDK) and Maxim Integrated Products (MXIM) and CNOOC (CEO) are ten that are coming to you. None are ready to buy yet, but time will tell.
Yesterday’s portfolio movers from the Cara Watch List:
Here are the top gainers from Monday from the Cara 100.
Interactive charts of the top 12 Watch List gainers (Interactive link)
Here are the top losers from Monday from the Cara 100.
Interactive charts of the top 12 Watch List losers (Interactive link)
Yesterday’s portfolio movers from the Cara Watch List:
Here are the top gainers from Monday from the Cara 100.
Interactive charts of the top 12 Watch List gainers (Interactive link)
Here are the top losers from Monday from the Cara 100.
Interactive charts of the top 12 Watch List losers (Interactive link)
Interactive chart of the only Cara 100 stock that hit a 52-week Intra-Day High. A week ago, there were 17 as the market was getting over-bought.
There were no 12-month lows in the Cara 100 yesterday.
Yesterday, there was a problem with some browsers (Firefox and old Adobe Acrobat readers) in reading the reports on India. I tweeked my system and hope everybody got to download the two reports.
Posted by Posted by Bill Cara on February 13, 2007 07:58:13 AM | Category: Cara's Bull Board
Discourse
8:45pm ET Venezuela agrees to buy Verizon's stake in CANTV Telecom - DJ (VZ) 37.57 -0.13:Venezuelan President Hugo Chavez struck a deal with Verizon Communications (VZ) valued at more than $572 mln to acquire the co's shares in Venezuela's largest telecom carrier, CA Nacional Telefonos de Venezuela, or CANTV. The purchase of Verizon's 28.5% stake is Chavez's first step to put CANTV back under state control roughly 15 years after it was privatized. It also allows Verizon to unload an investment it had long sought to sell
dow futures +34 on AA GM MMM gap ups
nyse volume down 20% from friday, and nasdaq vol. down 15%, so i would not want to be shorting indexes 'low' during options expiration week, SPX holding fib and previous highs at 1430~
QQQQ fib and 50 day ema here, and rsi(5) closed at 32
late semi shorts may need to cover ahead of AMAT ALTR reports tonite
dollar a significant drop away from 200MA, good for metals, dollar has not been able to get thru 200MA for a month!
gold and silver have 'holy grail' buys at their 20 day emas, due to daily adx(14) being above 30
Posted by: deacon31 ![[TypeKey Profile Page]](http://www.billcara.com/nav-commenters.gif)
at
February 13, 2007 8:19 AM [link]
mikede and others,
I will be writing up in a separate blog my plans to cover PDAC. I have arranged for one assistant to help me cover each company of interest. I'll be asking the kinds of questions that could get info that might help interested traders make some sense of these situations. But if there are others who plan to attend, and who wish to share in the info gathering and reportage, I'd be delighted to meet with you and put together a plan that could result in some excellent reports.
Years ago, I attended when there were maybe 1,000 participnts, including exhibitors. Getting to meet everybody on the floor and in the hospitality rooms was a challenge but could be done. Today, with 15,000 high level attendees from about 100 countries, that would be impossible. Remember, this is not a consumer show. You get to meet the senior officers and key staff of close to 500 companies and reps of at least 50 governments involved in mining. Every serious mining analyst in the world attends.
Last year, I chatted up a man from Finland who said there were about 60 important people in the domestic mining industry of his country and all of them but one were in attendance, and he knew why that person could be there. I have already had mail from Europe, Barbados, Argentina, and across North America, from people who I plan to meet at PDAC.
Precious metals are in rally mode (gold is up about $5 again this morning). Fiat currencies are in trouble. Traders need to know where to invest their assets. Meeting the miners and prospectors face to face will help.
Let me know if you plan to attend. If you wish to meet any mining company CEO or key staff, and feel you need an introduction, I will arrange it. But you should know, these people are attending because they want to hear from you. There is no industry in the world, in my view, whose senior executives are so readily available to the publc.
Posted by: Bill Cara at
February 13, 2007 8:39 AM [link]
Trade data bullish for gold.
July 2006 highs are providing resistance.
61.8% retrace providing support.
IMO, the PAPER gold traders are bearish and are rallying the troops here for a last stand. While the PHYSICAL gold traders, mostly overseas, are buyers here and are providing support at the fib retrace.
IMO, this is a key battle happening NOW.
Gold mining shares seem to think the paper/futures traders will win, or are worried that they will. If and when the physical gold buyers win, proving their strength, the miners will follow up.
IMO, their is a lot of money that would normally be going into shares that is going into the gold ETFs. Most of the bullion added to storage for GLD and IAU is for funds/institutions etc. but some is also from joe public who in the past would be buying companies like NEM and ABX and PDG, in the past of course. PDG was swallowed up earlier. This trend of majors consuming other miners will continue.
Posted by: g034 at
February 13, 2007 10:25 AM [link]
Thanks, g034. This is what I was saying last week, although with less precision. The miners are not leading the way this time.
EJ
Posted by: EJStockman at
February 13, 2007 12:11 PM [link]
Bill, Do you see any hope for Western Goldfields here. I believe the naz ADR is wgdf. It's nearing a stop point for me.
tkx,
Dab
Posted by: dabonenose at
February 13, 2007 1:09 PM [link]
dabonenose
Western Gold Fields (WGDF) just took 2.25 million shares off the shelf.....may take some time to absorb that in the market to create any investor value.
According to their web site they are drilling holes, unfortunately drilling is different then panning the hill for nuggets.
Could be a possibility that WGF will need additional dollars if the drilling results do lead to WGF panning for yellow nuggets. You'll probably be the last to know if there is any more dilution. Good luck, sometimes patience is a virtue!
Posted by: bigwad at
February 13, 2007 1:43 PM [link]
WGDF -
at a support level that I "eyed in" a while back.
below that is the 50% retracement, close enough for me to NOT have concern if first support is broken.
THIS IS NOT A RECOMMENDATION TO BUY OR SELL: But, I have seen, in other stocks, mining company stocks, when an obvious support level is broken to the downside, stops are hit, mom and pops are squeezed out and then the stock rallies. If the market maker sees a bunch of resting stop orders, what is keeping him from setting them off (they have their own accounts, btw), running it down, taking a position and letting bidders rally the stock higher. It's called a shakeout amongst other names. It happens time and time again. I AM NOT SAYING THIS WILL HAPPEN HERE, BUT IF IT DOES, IT WILL BE A LEARNING EXPERIENCE FOR ALL WHO ARE WATCHING. This is the reason I never have resting stops.
Long WGDF
Posted by: g034 at
February 13, 2007 1:50 PM [link]
XOM indicates worry over venezuela 'migigation'' on the tape
breakouts: APPB GM IP ROK
penny players it's KBX 2nd round 1.52 or lower
BQI, oil sands, doesn't look like it has fundamentals, but i imagine the dennis gartman types are getting in here and will rec it again as soon as it gets a head of steam
Posted by: deacon31 at
February 13, 2007 2:21 PM [link]
oops mitigation, not migigation haha
Meanwhile, Tillerson said Exxon is still waiting to hear from Venezuela's government about its plans for the Orinoco river basin. "We don't have any details yet," he said. The company expects that at some time, "the oil ministry will be contacting us to sit down." Discussions for the transformation of the Exxon-operated Cerro Negro project into a joint-venture controlled by the Venezuelan government are in progress, an Exxon executive said during a conference call earlier this month. the company has said it is seeking an amicable resolution. Rising nationalist rhetoric by Venezuelan officials has fostered concerns about the tone of the negotiations with major oil and gas companies operating in the Orinoco belt.
Posted by: deacon31 at
February 13, 2007 2:23 PM [link]
Maybe the "traders at Fidelity" have an answer.
LOL. Just kidding.
g034 has it right IMO. This is a battle between the commercials and the physical. The ronsen.blogspot.com site references the current bearishness of the commercials at Software North.
http://www.softwarenorth.net/cot/current/charts/GC.png
In another area: Nice 4 day move in Cara 100 GSK, RSIs moving up over 70.
Long WGDF & GSK
Posted by: Seamus at
February 13, 2007 2:26 PM [link]
g034, I know you speak from experience. Another term for "shake-out" is "sweep the street" in which a group of conspiring market makers call around to their desks and simultaneously pull their bids, which causes prices to fall, which in turn triggers some near stops. Then after another group phone call (many are on the same squawk box), the bids are re-entered, and the trap closed. Then they take the market up. This practice has been going on for oh maybe 80 years, and I'd guess that many of the leading lights on Wall Street know the game, and may even be experts at it. What is wrong with this, of course, is those market makers hold your orders and they use this knowledge to trade against you. They conspire to rip you off. Wall Steet and Govt facilitates it because of something called a broker-dealer, which is the most conflicted entity the world has ever seen. When brokers are separated from dealers, which are separated from commercial lending banks, then, and only then, will there be a remote chance to have a "fair" market.
I have been writing about this problem for almost three years in this blog. I hope the message is sinking in. BTW, I have made these same statements, formally and informally, to securities regulators. They don't and won't take action because regulators first serve vested interests. The public is an after-thought. It's up to all of you to speak up if you have any hope of trading on a level playing field.
Posted by: Bill Cara at
February 13, 2007 3:15 PM [link]
Bill
It's going to become more difficult to prove your broker/dealer anguish when the SEC is on the move (sneak) to lend a helping hand to corporate corruption and kick the investor at the same time.
Don't know if you subscribe to the NY Times, but I'll post a link and you readers can subscribe for free or not.
I don't think I have ever seen you take a jab at the SEC, is there a reason for your restraint?
http://www.nytimes.com:80/2007/02/13/washington/13sec.html?th&emc=th
Posted by: bigwad at
February 13, 2007 3:51 PM [link]
Sinclair has a report that NASD is planning to prohibit Americans from holding stock certificates. Additionally, in the future, there will actually BE no certificates as they will be going 'paperless.'
I could not find a news story to back up his blog posting, but I will be looking. There are a couple of web site entries about it.
This cannot be good a good move for individual investors. I know of at least one person who takes certificates to prevent his shares from being loaned to short and to slow down his 'trigger finger' on the sell button when things turn down.
I guess those things he will no longer be able to do.
Google "Stock Certificate Dematerialization" for the very limited amount of information available on this topic (it figures.)
See jsmineset.com for the text.
Mike
NYC
Posted by: MikeNYC at
February 13, 2007 4:13 PM [link]
bigwad
The SEC are "securities regulators".
Bill has mentioned "securities regulators" many times because his readers include many Canadians, Americans and others from elsewhere. My understanding is his reference includes the SEC, CFTC, the Ontario Securities Commmission, etc. depending on what inequity (and where) he is referencing.
Posted by: Seamus at
February 13, 2007 4:16 PM [link]
Thank you Seamus. I think the SEC (under Chris Cox) and the Cdn Securities Administrators (except for possibly British Columbia) are doing a pathetic job for the public. But govt appoints these people, and the public elects govt. It is up to the public to take control. Vested interests are well-organized and well-funded, and they are always going to have control of the casino.
I have given up on Canada. The securities regulators are in cahoots with the leading corporate lawyers and judges and the owner-managers of the exchange facilities. It is flat out biased toward the interests of Friends & Family.
In the US, it would take a person like Eliot Spitzer as President to shake up the SEC the way it is urgently needed. It would take somebody as knowledgeable as Arthur Levitt taking instructions from a hands-on Eliot Spitzer to even begin to address the serious problems with securities regulation in the U.S. The current Administration (and the previous ones) were just foxes in the hen house.
The previously linked NYT article should be read by everybody. It points out a shameful situation with the current SEC. Voters should be screaming at their elected reps.
But if you don't speak up, nothing will ever get done.
Posted by: Bill Cara at
February 13, 2007 5:12 PM [link]
Nice move in the transports today, bodes well for the near/longer term term in my opinion.
Cheers,
Ralph
http://blog.successfulonlinetrading.com/
Any one has any thoughts on MNG (Miramar Mining Corp). I have some on this one. It has been so weak recently even when gold price is strong.
Thank you very much for the comments.
Posted by: SmallCapFan at
February 13, 2007 6:27 PM [link]
http://www.pbs.org/newshour/bb/latin_america/jan-june07/venezuela_02-13.html
Chavez's New Policies Divide Venezuela
Tonight's Nesw Hour with Jim Lehrer has a ten minute segment on Venezuela that has important information for anyone with money invested in the country. Some Venezuelans compare him to Hitler and Mussolini, while others (the poor and dispossessed who have benefitted from his socialist policies) revere him.
Posted by: RDR at
February 13, 2007 8:07 PM [link]
http://www.pbs.org/newshour/bb/latin_america/jan-june07/venezuela_02-13.html
Chavez's New Policies Divide Venezuela
Tonight's News Hour with Jim Lehrer has a ten minute segment on Venezuela that has important information for anyone with money invested in the country. Some Venezuelans compare him to Hitler and Mussolini, while others (the poor and dispossessed who have benefitted from his socialist policies) revere him. Most fear (or are pleased) he will be President for life, like Castro, but with real assets in the form of natural resource wealth.
Posted by: RDR at
February 13, 2007 8:11 PM [link]
Dear Bill,
I called my sis who works at a major fund last night and hipped her to your list of distressed mortgage lenders. I myself was to stupid and too wrapped up in other trades to actually buy any of them, but folks, in case you didn't notice, NEW did 0ver 8% today, FICC was up over 7 %, and FMT did damn near 11%. Way to go Bill, I only hope you actually bought some! The final frontier in my trading is going to be when I only just do exactly what I know is right without actually THINKING about it too much!
Best Wishes, Amigos!
Posted by: zen_archer at
February 13, 2007 9:09 PM [link]
I hope this story doesn't get ignored because it's downthread:
Overseas markets prepare for an inflow as China turns on the tap
http://www.ft.com/cms/s/7ed70d6c-bb06-11db-bbf3-0000779e2340.html
I'd love to hear what others think about this money being unleashed on the markets.
Posted by: number2son at
February 14, 2007 12:34 AM [link]
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Bill
When attending PDAC what game plan do you layout, seems an awful lot of information to absorb in a short time. I'm planning on attending and would like to make it productive.
Posted by: mikede![[TypeKey Profile Page]](http://www.billcara.com/nav-commenters.gif)
at
February 13, 2007 8:11 AM [link]