Proof of Concept? Those that bought TM at around $90 are happy to see a 116-118 bid/ask this AM. Not bad for a few weeks patience.

craig- thank you, taking GFI off pre-market...

A survey of commodity stocks and fund:

http://themessthatgreenspanmade.blogspot.com/2008/02/survey-of-commodity-funds.html

The perils of persistence

With a generation of traders brought up to believe that the Fed will come to the rescue whenever things look like going belly-up, their historic determination to pursue outdated trends is likely to be even more marked than usual in the present downturn. That irrational persistence also likely means the same traders will miss the first 50% price move in the stock market recovery.

http://www.prudentbear.com/index.php/BearsLairHome

Good morning.

Here are your Cara 100 Ratings Changes:

Downgrades:

BBBY - to Underperform @ Morgan Keegan
UBS - to Peer Perform @ Bear Stearns

Target Price Raised:

QCOM - $46 to $52 @ Oppenheimer

-------------------------------------------------

Have a great day.

Question for the group: If I buy Canadian gold coins, Does the Feds keep a database on who buys?
(I case the feds ever wanted to take your gold!)
Kaimu's got me thinking.

ProShares UltraShort China ETF: Caveat Emptor!
posted on: February 18, 2008 | FXI / FXP

Originally written on Feb. 9, 2008.

A week ago I concluded that the UltraShort FTSE/Xinhua China 25 ProShares fund (FXP) was not working as advertised. I decided to follow up with ProShares to get to the bottom of the mystery and ended up discovering that there is much more to these leveraged funds than meets the eye. In short (no pun intended) this fund is working as advertised but it's not what most people expect. And judging from the exchanges on the message boards I can assure you that there are a lot of people out there that don't understand what they are invested in. Apparently ProShares is used to the confusion because they have the subject aptly covered in all kinds of handout materials.

http://tinyurl.com/26y882

Anyone watching the ten-year rate climbing today?

The bond market knows the score.

I'm not sure if intended, but the excerpt above makes it look as if this story is a positive or bullish one, which isn't what I read.
I read this:
"Whoever is elected President this November had better accustom himself or herself to the idea that there is likely to be little economic recovery for his whole first term in office. The expectant candidate should not expect a Great Depression – unless his own policies are exceptionally inept as were those of Hoover and Roosevelt in the 1930s -- but he should prepare for an experience like the unhappy second term of Grover Cleveland in 1893-97 or the miserable White House tenure of Martin van Buren in 1837-41. As Japan demonstrated in the 1990s, there is no reason that the recession that follows a period of vast excess should be over within a year or even two.

However, there is very little likelihood that market traders and economic commentators will expect such an unpleasant development before it arrives. It is also very likely that when vigorous recovery begins in say 2013 they will refuse to believe it, and will thus miss the first 50% price move in the stock market recovery."

So that 50% they're looking for is a few years off, not in the immediate future.

Canadiansailor: buy small amounts at a time, using cash. I think there is a certain amount over which the dealer has to report the sale, but I can't remember what that amount is. It might be $10,000, but I'm not sure. Possibly someone else here knows the number.

Gold coins: In the U.S. no records on purchases/sales under the $10,000 reporting limit on large transactions.

No idea about Canada.

Good Morning 2nd, my pleasure on GFI, hope you made a killing.

hedging longs with a little QID @ 49.80...

Bill,

Over the weekend I was passed along some insight into Milberg Weiss, a special club, and US Judges. I thought maybe your guys would be interested in how well our Judicial System works (or not).

http://investigatethesec.com/drupal-5.5/node/183

Your bloggers here may also be interested to know that there are some serious behind the scenes issues taking place at UBS where retail brokers and managers are defecting due to uncertainty about the future of UBS. When it hits retail you know something is up.

craig- re GFI->no, it was just a one-day trade...in on friday, out today...

vinod- easy to lose your balance on that FXP surfboard->i would try to ease myself into a more manageable position size...suspect they sell the opening gap this morning, and with your entry point at the close friday, you should be able to find a decent exit, maybe even make a little money->should read bill's opening post for comments from the shanghai fly, also moneygenie's link to FXP volatility...good luck...

maromatics- nice call...gold up 20+...

2nd,

Thanks.

:-)

The key now is if POG can close above 918.

If so, a test of the max is in the cards, with a probable breakout.

FYI I am long, and remaining long.

Enjoy.

Cheers,

Let's see...in the flurry of the open...

Sold GLD
Sold GSK
Sold BRK/B
Sold partial WGW
QID, in at 49.60, partial sell at 50.10.
FXP added at 84...come to papa.

Added to FXP @ 84.15, this feels like a bull trap that gets sold. news mix, bonds, advance / declines...

Don't plan to hold this for too long, of course.

Bill
Given you r outlook, and with UBS and HBC in the acculation zone is this a position you would take, over would your longterm view tell you to stay away from financials?
Thanks

Bill, you are getting vindicated all over the place! WMT is only one excellent example.

Thank you.

Friends, WMT sales up 53% at my store on Friday, found out during Saturday night meeting. News on INVENTORY being controlled is true. Any WMT questions, just ask me. I know what is true.

Thanks Shreadhulk, you shred!

Fording coal FDG looks great.

The only thing I have to say about Walmart is that they had better start re-stocking my chocolate yogurt or me and them are going to have issues...

Has anyone mentioned to Dennis the idea is to sell into strength?

I'm LT bullish gold but come-on.... buying was last week.

Heck, all I read of Elder's book was the reviews and I picked up that much.

Check out VLNC too. breakout

craig- six shots at the open? LOL someday they're going to invent the flexible Cara100 ETF->point and click to add two parts SNDK/three parts INTC, delete 2 parts UBS...then you'll need an automatic...

LOL! My barrel was overheating, had to stop shooting!

Added WMT. Good day so far....

About outs on shelves at WMT, management is cutting back 2-4 hours on every employee to help control costs. This creates more work for all other employees, so some items do not get stocked immediately and sit in the back room.

FXP- taking it off @ 84.17 here for a loss..
QID- closing the hedge at 50.17...
SNDK- adding at 25.59...
INTC- adding at 20.44...

obviously all of the above was collectively the wrong move at the wrong time...

Yen is coming on strong...not good for a rally.

"About outs on shelves at WMT, management is cutting back 2-4 hours on every employee to help control costs."

I'm sorry, Bill, but I don't know how anyone in good conscience can support a company like this. They are all about exploiting low wage employees and low cost overseas suppliers who make WMT's own labor practices look positively socialistic.

I wouldn't buy a stick of gum at one of their stores, much less their stock.

2nd, look at financials too. Ugly.

I was able to squeeze off a couple shots at SKF.

Maybe should have taken my licks on FXP over 85....we'll see.

Dang, so I have to give my WMT profits back?
I shop at Fred Meyer (Krueger) and Costco, but I'm not going to turn down a WMT trade that benefits my family.

unbelievable- if i had pulled the 1029a trigger at 1031a, it would have been the right move? we'll see...

Canadiansailor,

There are probably better things to worry about than the gov't tracking a coin collection... I think limits are mainly for money laundering purposes.

The Canadian government has enough trouble with their gun registry, much less a coin registry.

With regards to Wally's (WMT) how will the rising prices affect Wal-mart's constant head-beating of their suppliers? Will WMT's prices rise, or will their portions & packages just shrink?

It's interesting to think that WMT is one of the largest contributors to the current trade deficit.

http://tinyurl.com/3apsyo

Will they do well in any market? They'd have to really screw up not to...

The media spin.

Penny-pinching shoppers boost Wal-Mart profit
http://tinyurl.com/2sql95

Maybe they should buy Yahoo.

However, it looks like they're battening down the hatches.

"The store pullback, the second in less than six months, may be the biggest in the company’s 45-year history, and suggests that Wal-Mart is reaching a turning point."

http://tinyurl.com/3yrsvy

Doctors are concerned about Wal-Mart.

"Wal-Mart began dabbling in retail health in 2005, when it opened 76 clinics. It says that over the next three to five years, that number could expand to 2,000. "

http://tinyurl.com/3dh8e4

Wal Mart already has the largest IPTV installation, and killed HD-DVD. They're very influential, but do share buybacks & decreases in expansion indicate a growth opportunity or defensive play?

Sorry, Krueger is Freddy, Kroeger is Fred Meyer.
I always get those two confused....LOL.

2nd, I couldn't believe it either.
Two minutes from pan to fire?

Actually I do have a question about Walmart now that we have a Walmart guru here. Is there such a thing as a Walmart store that is more of a training facility then a regular store? I'm in a small rural area here and I swear that the local Walmart stops carrying any product that becomes popular(like my chocolate yogurt for instance). I keep hearing people say, "oh, that's because this is a training store". Doesn't make sense to me. It seems to be the exact opposite behavior you would expect from a retail store, removing popular items from their inventory.

Best gainer this morning is GFI. Most options plays in the red, but I have learned not to have too light of a trigger pull.

Right shoulder under construction plus $100 oil plus the Bond market prices falling... Just have another cup of coffee.

I can't imagine any Walmart store removing items primarily because the items became popular. They must have all sorts of inventory tracking so they know how the items are doing. The answer that makes more sense to me is that the employees who tell you it's because they are at a training store need more training themselves.

ALOHA !!

Bill ... Thanks for the FLY comments. It amazes me that a Communist regime includes "food" as part of their CPI and the "free market" democratic American government does not! The US government has turned the America of freedom and justice that our Founding Fathers fought and died for into a socio-fascist state where the Middle Class and poverty are becoming synomynous. Once the Middle Class is irradicated what's left ... serfdom? Welcome to the USSA! I have posted many times here over the years regarding the absurdity of US government data and the CPI is one of the most ridiculous data points ever to exist. My feelings are they should have discontinued the CPI data and kept M3! If "air" were a commodity, like "food" then the US government would probably consider that too volatile and exclude "air" costs!!! Does the Chinese CPI include "fuel"?

Of course WalMarts and COSTCOs will profit from recessions. If you cannot afford prices at WalMart then you go on US government welfare or grow your own or steal food! Most will opt for welfare until the point where welfare like food stamps fail to cover monthly food costs. Then the other two options will kick in! Nobody is above stealing food when desperation sets in. Some may even prefer jail to the streets ...

What about that Middle Class bastion of "status eating" ... "Whole Foods"? Seems as if WalMart and SafeWay and COSTCO and Trader Joes would be taking a few customers away from Whole Foods. I do not believe Whole Foods will fair as well in a recession unless they have some severe room to maneuver in their profit margins. At some point food prices will rise high enough where food becomes food and nobody gives a damn about organic anything, except the rich and vegan die hards! Not to mention food supply or lack of it! Is that enough demographic to save Whole Foods bottom line? I notice that Starbuck's is closing stores. Isn't that the same crowd that shops at Whole Foods? I do not see Whole Foods future as rosey as WalMart or COSTCO ... Any views on Whole Foods future?

ShredHulk ... Thanks for your input! I love to hear from insiders with their feet on the ground ... I trust no data coming from government sources!

I notice that my local WalMart here in Hilo, Hawaii has supply issues and shelves are not as full on a regular basis, especially food items. Is that just a uniquely Hawaiian problem or is supply a growing issue at all WalMarts?

GFI: I liked it better premkt at 14.10 but still holding partial position.

Reloaded WMT @ 49.70

Sold etrade at the open 5.20
Sold abk 10.30
Markets are unsustainable....Banks will use the write down accounting trick to balance their mistakes this week and next.
I'm watching yahoo for a day trade

craig- do you get the feeling they sold the opening gap down to 12,400 and now want to take it back up to test 12,500?

Moved twice and both times the nearest store has been a Super Wal Mart. I find for most things they are great, but I usually buy vegs and meat elsewhere. 24hr stores... Often shop late and find even the stock persons very friendly.

Traffic has been consistent over the last year. Murphy oil station on site has been either lowest or near lowest. $2.91/USg 87 last night.

Traffic at the upscale outlet mall I shop at has been dwindling. Meanwhile new retail stores going up everywhere. Makes no sense given the economic outlook. Either the decision/commitment process is so long the retailers get out of phase with reality, or the powers that be are clueless.

OG, ANYONE,

What kind of read do you have on FCX?
I'm looking for an exit and pondering.

Thanks for help.

Gold at 930 rising fast!!

If you are quick on the draw this is fun.
Out of WMT @50 again.

Admit I was a bit too fast for myself on GLD but no whining allowed when you profit.

FCX: It's punched thru the upper Bollinger band but will probably hug it for a while. RSI needs to curl over before a heads up to sell. Gold is very strong, now at $929.40. IMHO Hold or put a trailing stop loss under it, maybe 3%.

All items are scanned when you buy it. All information they call "on hands" goes immediately to local warehouse that ships out to all local walmarts. When shelf is low computer immediately tells warehouse to ship out a case of that item. Now here is where it gets complex. Department managers or Management can order cases with a TALZON when they feel they need an item specifically. Also, WMT does store specials that they send to every WMT at the same time within a day or so. Or warehouse might be out of that item. Or item may be deleted from MOD/shelf and computer but department managers suck and didnt remove tag from shelf. They do not try items at specific WMTs but they are demographic specific about what they sell. Hope that helps!!!

Is there any money flow data that would indicate "out of bonds into Gold and PM"?

Yen has reversed and is strengthening. I have calls for 94. Markets down, Yen up.

staying short FXI as long as the XLF is getting trashed...whooped...

2nd, the technicals are all pointing down still.
Quite negative...maybe bottoming here, have to see it happen. Just now starting to slow down but MACD still south.

Both XLF and XLK (tech) are negative.
We'll see!

TM- if you'd bought near the low january 22nd, this cara 100 company would be handing you a 26% return as of today...another reason i'm adding to SNDK this morning->some stocks are going to outperform, and it's hard to say when it's going to happen...

DJIA below 12,400?->let's see where it ends up in another 2 minutes LOL...

XLF sitting right on support at 26.50.

2nd, W%R on both financials XLF and DJIA are 99-100, Cramer's SELL, SELL, SELL button is stuck.

wondering about Capital One Financial (COF)...

http://stockcharts.com/h-sc/ui?s=COF&p=5&b=5&g=0&id=p52899090538

an opening gap to $48.76; and then, kerplop!

I WAS short COF, with my stop at $48.75.
COF is liquid. Is this a coincidence? Surely, 'they' aren't picking off little guys like me, are they?

Any opinions?

XLF: Yes, but look at that MACD...no sign of turning yet.
When it does will be looking at UYG.

craig- agree the trend will be down over the next few weeks...just trying to game the intra-day sentiment, and not doing well at it...probably should have gone to work instead of taking a 4 day holdiay ;)

Silver on nominal trajectory; go at throttle up; approaching orbit at $22.

Hi,

Re PoG: impressive day.

You might be calling it 2nd. 12400 is holding so far.

XLF RSI is turning up though. Waiting for confirmation before putting cash to work there.
W%R now in 80's.

Posted by: Aurator at February 19, 2008 11:04 AM

Thanks pal. have stop and waiting.

Speaking of inflation in China affecting U.S. import prices, there's more. Beneath the radar the yuan renminbi has steadily strengthened vs USD. Seems like only yesterday we reached 7.50; this morning it's at 7.15.

Scroll down for 6 month chart; you can change the timeframes.

http://tinyurl.com/2lummq

2nd...patience here will pay. I think you are right so far, maybe a bit early on the draw. Let it come to you.

My question here is: can we rally into a stronger yen?

Mebane Faber had an interesting outlook on Gold. We are definitely not in the late innings yet.

http://tinyurl.com/36knat

vinod- advantage of the trading mentality (and one you may want to exercise) is the ability to free yourself at any time from a position...i don't know if FXP moves up or down from here, but as soon as i admit that to myself, the prudent move will often be to exit the position...your entry point was 87, it's now 2.8% below->if you see a move back to the nineties, then hanging on makes sense...if you see a fall to 70, then you're free to pull the ripcord, get back on solid ground, and look to re-enter around 70->if you get back in at 70, how long will it take to make up today's loss?
believe me, there are new opportunities every day, and the last thing you need is having capital tied up in an ill-timed trade...good luck either way...

mg - re FCX. Not advice, but were I in it for a swing trade, I'd like to think I'd have exited around 99 when the 3-minute RSI hit 81.2 at 9:33 this morning. But then, I always exit too soon. Trailing a stop at/near the 3-minute SMA(50)--currently 98.20 and rising--doesn't strike me as a bad idea either if in it for the short run. If you want a longer-term perspective, I'm not the right person to ask. Good luck with your (very nice!) trade.

wonder if the mkt will follow GOOG?

playing the gold move via WGW- in at 3.70

UYG in at 34.12

mg -- Jesse L. would say that if you've begun right, sit tight. But he also advises "When you want to get out, get out." Much depends on your time horizon and tolerance for risk.

Alright 2nd...out of FXP w/small loss. Such is life. :>)

2nd, see V bottom forming in XLF, 93 RSI/26 W%R/macd cross

Since July, the market has declined in tandem with the junk debt market. This is the first time that junk has been sold and the market has held up.

http://stockcharts.com/h-sc/ui?s=HYT&p=D&b=3&g=0&id=p75331062697&a=130749135

craig- correct perspective is you handled a trade that went against you perfectly...;)

GFI - The 3-minute EMA(83) has twice today served as support--to the penny, first at 13.64 and then at 13.68.

A play on Castro news forming.

CUBA

I feel burned by the market. All the profits I made in January were lost in Feb, plus a little. I had a straddle on the Dow 2 weeks before the expiration of the options thinking that there would either be a continuation of the bull bounce, or a reversal and a bear move down. I was gone for 4 days and the dow split the difference between my straddle, and the options premium flat out died. My $2k that turned to $10k in January is down to $1.5k now.

I enjoy trading when I'm able to watch the market all day, but I don't feel comfortable leaving any money in play when I'm not watching. Right now I'm stressed out because of what the markets are doing(just like the investor that Bill talked about. The one that he helped increase his return with options, but told Bill the extra money wasn't worth the stress). I'm ready and willing for Bill's professional advisory services. I enjoy running my computer business, I'm really good at it, and I can leave for a 2 week vacation and trust that the people I've hired will have done a great job without me. I can't say the same for my portfolio right now(considering I'm the only one managing it).

And for kaimu, I have half a pound of physical gold. Plus for food, living in Washington state I get a moose every year for the past 3 years. :) That's enough meat to fill our deep freezer and feed my wife and I for months.

On a side note, are there any hunters in this community? If so, what do you hunt? What is your weapon of choice? Where do you hunt? etc.

2nd

First thanks for your advise
Now I got time to Wright
I did got out at 85.40
And hit for 800 I took I 600 back by doing round trip in qid
Some time I have lots of time to go online and some time I do not have time

Thanks again

vinod- that's great! and anyone who thinks "Wright" was a typo (capital 'W' included) would be wrong->you just took your plane out of a nosedive and back on cruise control...congrats...

2nd
Also guy at trading room said

Wright l March 90 call at around $8

Let them take it or you keep the premium

SNDK coming out of its own 2-day nosedive...

2nd: I suppose. I could have saved a $100 by exiting earlier above 85 but it was not to be.
Something about pigs getting the fork....
I cannot complain today.

Once it appeared XLF and DJIA were turning up I had to bail on the technicals.

WMT: another small entry here.

GFI - Overnight moves can be tracked under ticker GOLI.SW on the Swiss exchange (in CHF - Swiss Francs) at http://www.swx.com/market/quote_chart_en.html?id=ZAE000018123CHF4

Note that trade volume is very low; nonetheless is a sentiment indicator, especially on days like yesterday when US markets were closed.

GFI - upgraded this morning by HSBC Securities from Neutral to Overweight

vinod- i don't about that- the march 90 call sounds like a good bet on a day like this...but what happens if the bottom drops out of the market and suddenly FXP is trading at 115? you will need to shell out 11,500 to buy 100 shares of FXP and sell it to someone for 9000...

if, on the other hand, he was referring to writing covered calls on part of the 500 shares you had, might be a good bet (since you already own(ed) the shares)...find it hard to believe someone would pay an $8 premium for the option to buy FXP @ 90->says a lot about the volatility in this ETF...

Thank you OG, nice little kernel of news not on my screen.

Still long UNG. Looking to sell today on this rally. No shorting GDX. $930 on gold futures is resistance. Through that and we could see the high side of $900 before this rally is over. With Yen stronger on the day broad markets have limited upside.

I_Loser
"I'm sorry, Bill, but I don't know how anyone in good conscience can support a company like this. They are all about exploiting low wage employees and low cost overseas suppliers who make WMT's own labor practices look positively socialistic.

I wouldn't buy a stick of gum at one of their stores, much less their stock."
Amen

OOOOOOps. Meant "high side of $900's".

Hmmmm, running out of gas?
Taking profits here.

maybe- will take INTC off at 20.61...

GFI - Also trades as GFIJ.J (in ZAc) on the South African JSE exchange. Quotes available via Reuters at http://africa.reuters.com/instrument/quote_result.ehtml?s=GFIJ.J;type=symbol;

Volume much higher on JSE - more than 2 million shares/day.

Very dangerous activity selling calls if you don't have the shares. Not recommended unless you're a real pro who has been there, done that and knows his/her risk tolerance.

Wouldn't sell any calls unless you had the shares and you were willing to depart with them at that price. Would give up additional gain if shares continued to climb; if they don't hit your target price, yes, you could pocket the cash. Best to leave to professionals if you're just starting out IMO.

Gartman made a swift reversal today recommending
adding gold and upping the total amount with a move above $915. pretty aggressive.

will gold shares move up while the financials take a dive?

Anyone but me thinking the Etrade commercials with the baby are the funniest thing they've seen in a while? They're killing me! LOL!

partial profits on SNDK @ 25.83...

The Clinton campaign is showing us how low they will go in attacks and what would be in store if they are elected. I'm DONE with this type of politics. Keep digging Hillary.

INTC: out at 20.68

Uranium: Goodbye Hedgies, Hello Real Demand

http://www.uxc.com/news/Combs-Indaba-2008-02-04.pdf

Here's an excellent PDF from UXC on the state of the U3O8 market and where it may be going. I have been trading in & out of CCO & DML over the past couple of years with reasonable success but am now inclined to start accumulating while the spot price remains in the $75 area in anticipation of the next commodity boom. Any comments?

Sold UNG @ $43.83 for a nice 2.5 points profit. 100% cash hoping to find an opportunity to buy GDX lower from current levels. Also watchful waiting for a short of IFN.

ToG play.
Mutual fund DXKSX - "The 10 Year Note Bear 2.5x Fund seeks daily investment results, before fees and expenses, of 250% of the inverse (or opposite) of the performance of the 10 Year Treasury Note."
Chart looks OK. No Load, No transaction fee @Scottrade. Buying small position today. Orders must be in at least one hour before close.

Why Juniors are Under Performing:
http://www.resourcestockguide.com/home_page.php?drc=1&hpc=15

Looks to me like GOOG, AAPL, BIDU are poised on important support and can't seem to rally. GOOG and BIDU are leading the way down. AAPL is under its January lows.

Doesn't look good for the bulls. Today was a perfect setup for a rally but it seems like it is fizzling.

GOOG, BIDU, GS down 3 to 4% each. Debt markets are right as usual.

I bet we have a negative close. I was positioned correctly after all, and glad I was away from the PC most of the day so as not to tinker.

Added puts on XHB. Who is buying home builders anyway? They have wayyy more faith than I.

PLUNGE FXI ...PLUNGE !!

Exiting...FXP..enough is enough..

How can anyone
even invest these
days?

This is not a place to put
your money. Its a big casino
now.

Wow...market are turning ugly.
Hope everyone took advantage of the opportunity to sell longs this morning.
Of the cara 100's leading the down side today is gol goog and oxps. Leading the upside is ntes gfi vcp rio and bhp.

Hi,

The TOG keeps on shaping: look at the long US bond today.

Maybe the US long bond has peaked.

Credit markets, again, lead the way, and the message is clear: inflation, maybe hyperinflation is in the cards.

No woder gold is spiking, and is getting ready to challenge the highs...

What is driving XLF (the financial ETF)? It’s the ABX indices! Or at least it seems so. “Each ABX index series references credit default swaps written on different tranches of 20 U.S. subprime deals. The different tranches are rated AAA, AA, A, BBB, and BBB-.” Basically, each series shows the value of $1 invested in the portfolio of collaterized debt obligations (CDOs) of the particular credit rating. Here is what John Mauldin wrote about ABX indices applied to banks some time ago: “The ABX indexes create a price comparison that cannot be ignored when you are putting together your accounting for your net cap reports. If the index is dropping, you are going to have to mark your assets down if you have similar assets on your books. Period, end of story.” Now look at the index price charts on http://www.markit.com/information/products/abx.html (click on each index to see its historic price) and notice the almost perfect correlation with XLF. The explanation for this is simple: the total Level 3 assets of major banks is larger than their equity base (http://www.rgemonitor.com/blog/roubini/224871)! We all knew this intuitively based on the scant explanations in the news, seeing that XLF falls whenever a large bank announces writedowns. So the smart money knows that this is the name of the game, and that the force that can kill or cure the financials is the change in value of their Level 3 assets as indicated by ABX indices.

What does this tell us? First of all, we can know whether a particular rally in financials is “real” or not. For example, the ABX indices are at their historic lows now and are trending down. They are sitting at their long-term support level, and next week they can fall below this support, so check these indices daily! I think they are updated once a week on markit.com. I was also very concerned at some point that I will miss the end of the bear market and will keep increasing my short position in XLF as it will start growing for real. Now I will be checking ABX indices before increasing my shorts in XLF, and if they are growing, I probably won’t be increasing my shorts.

Are their any other useful conclusions and trading strategies that we can derive from the correlation between ABX indices and XLF?

DavidV

At what point for POG would the "powers that be" increase margin requirements as Bill has previously referred to?

LIGHT Volume though
especially on DIAMONDS
[DIA]

Are these
naked shorts too?

DIA -

Volume appeared with the selling but was light earlier on the upside.

The next story is the ARS debacle. Companies and municipalities that were counting on 4% interest costs are now paying >10% overnight. Since most of the reported job growth last year was in government, this is another strong headwind for job growth.

It seems that 26.50 line on XLF just doesn't want to break.

Zenob..XLF is forming its own little wedge on a 3 day chart...the Qs felloff that rising trendline..if HPQ cant lift the Qs...beyond 43.50..ouch..more downside..

GFI - 10-minute ema(25)and 3-minute ema(83) continue to provide support, now in the 13.90 area.

Tarheel,

I wish I knew the answer to that question, but I suspec they will do it at a time when it really hurts, and not when things are OK.

Craig - You got two cracks at 14.10 on GFI today; think you're gonna get a third? Or did you exit on #2?

Picking up some SRS @ 114.15 before the various releases tomorrow.

Holding FXP, just about back to my basis. If I only had a snorkel I could breathe...

Maromatics,
Thanks, have enjoyed your posts and those of all in this community - have learned a great deal and become a better trader as a result.
Just looking for a lower entry point to add more to physical holdings and as you pointed out a few days ago, that may have been my chance for now!

I was out @14.09 OG. Thank you for looking after me!
Got back into BRK/B @ 4709.99, now up nicely.
Also added to SNDK....fighting myself...oooooh scary!!!

HPQ gonna help Q's tomorrow? My SNDK hopes so.

Thanks for the note Bill. I cant imagine trying to comment on this stuff!

It seems to me, its no longer "free"
Was it ever?

Another question -
I get the feeling more and more these big wigs at the top brag about global capitalism,
but they are really socialists
in the end, the feed off
UNFREE MARKETS and GOV'T largesse

og,

Thank you for verifying my own take and for words of wisdom.

I did not sell. But I bought $95 puts, so will let it run tomorrow open at best then sell... I'm looking at price of gold, if it holds to close and open up.

I'm comfortable. Thanks to all who share.

Bill,
Hb&B sure does a good job of misleading people about trading.

I told someone that I trade and more or less how it works and they said, "How can you do that, you're not investing in those companies."

I explained exactly what you posted....he still didn't get it. Truly amazing.

Buy low and sell high is not complicated, is it? Somehow the timeline seems important.
I don't know why. No wonder HB&B finds it so easy to "fleece the sheeple" as go34 said.

Zenob, re our discussion on chart links to Stockcharts

Thanks for your replies yesterday, agree I used the wrong term URL "redirect" should have been "referer", I'm no HTML expert. And yes I have used the Firefox config editor to change settings, but on this one I'll leave it for now just so I can troubleshoot and experience what others are seeing. (also don't usually play around with the settings I don't understand, is there a manual for config?)

I did a little more investigation and even with charts in my public Stockcharts folder same thing happens for most sites, even my own message board on my server, however I can still post links or embedded charts on IHUB and Stockhouse as normal.

I'll detail what I've found and contact support at Stockcharts to see if they have a solution.

craig- nice re-entry on SNDK->Naz up after-hours on HPQ news...(left to watch the little guy earn his next ribbon at his weekly swim class)...INTC bounces right back to 20.60 from the 20.16...

Quasi, here is the big list of settings for mozilla's config file. The relevant settings are found in the network.http section.

http://kb.mozillazine.org/Firefox_:_FAQs_:_About:config_Entries

This probably needs to be addressed on stockcharts end. It's not very practical to have all the visitors to Bill's blog hacking around in their browser configs. Plus it's kind of silly on stockcharts end anyways. Adding the ability to share charts with a board friendly link but then blocking access to it if the referrer header has info in it is kind of like putting out a welcome mat, then nailing the door shut.

I might play around with google docs some and see if I can find a viable workaround that way.

..from the 20.16 close (on INTC)...

have to say FXP looks good for another trade after hours, but i'm not spotting an edge here...staying out until tomorrow...

Tarheel,

Thank you for your kind words.

Welcome to the team!

:-)

cyderman- re DXKSX->managed by DireXion Funds in NY...also offer several other categories of 2.5x long and short funds...quick research on Fidelity shows no transaction fee, a ST trading fee of $75 (at least for Fidelity traders only, not sure if Scottrade)...what blows my mind, though, and it may be just a typo on the Fidelity site, is an expense ratio of 11.93%...be careful...

Quentusrex: I don't hunt but my wife and I did buy a very small farm as a long term plan. So far it's working out pretty well.

RE: Trade of the Generation

Anyone thinking about the best way to short the long bond? Some have suggested to short leveraged closed end bond funds Others mentioned buying RYJUX...but their fees are high.

I was looking at options on BLV which is a Vanguard Long Term Treasury ETF.... BLVUB.X
Sept 08 80 is trading in the money at $4.40. Current price of BLV is $75.04. Will the long bond be going up within 7 months or will it be into 2009 before/if the move happens? Expiration is only about 45 days before the election.

Any comments or thoughts ?

ATTN: Kaimu....re Whole Foods....someone made the comment that those millions of baby boomers who have little savings should begin eating a bit of cat food to get used to the taste.

There was a spelling mistake in my post
When market was over 100 point
Guy at trading room wee saying we will close flat or lower
I did not want to post that. Because I do not want some one make decision base on that
But their opinion was correct
sndk 300@25.15

A piece of humor that fits some people's theory of possible government confiscation.

"Now that President Bush has declared martial law, it will be illegal to own precious metals after the first of the year. Here's a sneak peek at the new money."

http://blip.tv/file/520347

Note the last paragraph....

US officials say the trend shows that financial authorities have become far more adept at channelling liquidity into the banking system to alleviate financial stress, after failing to calm money markets last year.

However, the move has sparked unease among some analysts about the stress developing in opaque corners of the US banking system and the banks’ growing reliance on indirect forms of government support.

“The TAF ... allows the banks to borrow money against all sort of dodgy collateral,” says Christopher Wood, analyst at CLSA. “The banks are increasingly giving the Fed the garbage collateral nobody else wants to take ... [this] suggests a perilous condition for America’s banking system.”

http://tinyurl.com/2ty2fa

vinod- sometimes we write on auto-pilot and end up saying something profound->in your case, "Wright" can be read as flight (as in the Wright brothers), and i was pointing out that you actually made (albeit unintentionally) an astute comment about maneuvering your position safely out of a nosedive...;)

secondly->i have no problem with your posting any comments gleaned from the trading room...every piece of (real-time) information helps...

SNDK @ 25.15? you don't need anyone's help, my friend ;)

OldGoat- any idea whether jesse livermore used technical analysis?

Kaimu re: Whole Foods

I can provide one viewpoint from a whole foods shopper. First though, I would suggest that many shoppers there are “principled eaters” rather than “status eaters”. Every time I shop there I vote with my dollars and I consider it money well spent. What principle is it that I think I am voting for? It is my respect for the environment and all the other creatures that share the planet with humans that I am supporting. As a farmer yourself, I would hope that this concept would resonate with you. As you may be aware, pesticides are an offshoot technology from military research that was performed after WWII on chemical nerve agents. These chemicals, initially designed to attack the central nervous system of humans (i.e. the enemy) were easily modified to perform the same function on insects killing them by attacking their central nervous system. The exposure of farm workers to these chemicals has been well documented to have serious health implications along with many negative effects to wildlife and water supplies. Additionally, eating the trace residues on produce in my opinion has significant impact on human health although this is much more difficult to document. This is true of all the ubiquitous environmental toxins that humans have become exposed to in our technologically advanced society. To me, the situation in food production is very similar to the situation that Bill describes in capital markets. The system is broken. The idea of huge mono-crop farms that are highly dependent on fossil fuels and chemicals is so crazy to me it is hard to understand. They have devastated the topsoil and the nutrients that once existed there to the point that the vegetables produced are lifeless and without flavor, let alone any nutrient value. Who could argue that a tomato purchased at wal-mart, Costco, Freddy’s, etc. has any resemblance to the tomato grown in your backyard vegetable garden? Rather than go on endlessly, which I probably could, I think I have made my point. So to provide my single data point for the market for whole foods, I would say that there is no price differential point at which I will cease to buy organic produce. Of course, I am a gold bug loaded to the gills with gold, so I will probably always be able to afford organic produce (at least I hope so). I have always found it interesting that food purchased at whole foods or similar stores is referred to as “health food”. Makes me wonder what adjective to use for food purchased at places like wal-mart. As Joni Mitchell once wrote, “I’ll take spots on my apples, give me the birds and the bees.”

While driving back from the weekend yesterday, heard an insightful radio piece on Hugo Chavez. Includes comments from Bart Jones, author of Hugo: The Hugo Chavez Story from Mud Hut to Perpetual Revolution.

Warning--length is 34 minutes--click on Listen now.

http://tinyurl.com/2jde92

T-O-G FWIW, Watching 20 year bond TLT after hours touching the 200 EMA, daily RSI7 now <30 at 29.33 and at current a/h price of 90.75 actually below and outside the lower Bollinger band.

GFI after hours trades (19:32) now at 14.16.

2nd, thanks for the heads up on DXKSX.
Further digging into the prospectus does indeed show these alarming numbers, but they're oranges (cf apples) in that they are required to include interest paid on shorted securities as expenses, but they expect to receive interest income on the cash received from the short sale. Doesn't say they'll balance out though, and it is a high expense fund (apples to apples) and also subject to the same risk as the ultra ETFs in the way the leverage operates from one day to the next. Anyway, following the words of the wise and keeping position small.

2nd - Jesse's thoughts re what we today think of as TA is probably best captured in the following passage (intro to Chapter 5 of Reminiscences):

"THE average ticker hound or as they used to call him, tape-worm goes wrong, I suspect, as much from over specialization as from anything else. It means a highly expensive inelasticity. After all, the game of speculation isn't all mathematics or set rules, however rigid the main laws may be. Even in my tape reading something enters that is more than mere arithmetic. There is what I call the behavior of a stock, actions that enable you to judge whether or not it is going to proceed in accordance with the precedents that your observation has noted. If a stock doesn't act right don't touch it; because, being unable to tell precisely what is wrong, you cannot tell which way it is going. No diagnosis, no prognosis. No prognosis, no profit. It is a very old thing, this of noting the behavior of a stock and studying its past performances.

"When I first came to New York there was a broker's office where a Frenchman used to talk about his chart. At first I thought he was a sort of pet freak kept by the firm because they were good-natured. Then I learned that he was a persuasive and most impressive talker. He said that the only thing that didn't lie because it simply couldn't was mathematics. By means of his curves he could forecast market movements. Also he could analyse them, and tell, for instance, why Keene did the right thing in his famous Atchison preferred bull manipulation, and later why he went wrong in his Southern Pacific pool. At various times one or another of the professional traders tried the Frenchman's system and then went back to their old unscientific methods of making a living. Their hit-or-miss system was cheaper, they said. I heard that the Frenchman said Keene admitted that the chart was 100 per cent right but claimed that the method was too slow for practical use in an active market.

"Then there was one office where a chart of the daily movement of prices was kept. It showed at a glance just what each stock had done for months. By comparing individual curves with the general market curve and keeping in mind certain rules the customers could tell whether the stock on which they got an unscientific tip to buy was fairly entitled to a rise. They used the chart as a sort of complementary tipster. Today there are scores of commission houses when you find trading charts. They come ready-made from the offices of statistical experts and include not only stocks but also commodities.

"I should say that a chart helps those who can read it or rather who can assimilate what they read. The average chart reader, however, is apt to become obsessed with the notion that the dips and peaks and primary and secondary movements are all there is to stock speculation. If he pushes his confidence to its logical limit he is bound to go broke. There is an extremely able man, a former partner of a well-known Stock Exchange house, who is really a trained mathematician. He is a graduate of a famous technical school. He devised charts based upon a very careful and minute study of the behavior of prices in many markets -- stocks, bonds, grain, cotton, money, and so on. He went back years and years and traced the correlations and seasonal movements on everything. He used his charts in his stock trading for years. What he really did was to take advantage of some highly intelligent averaging. They tell me he won regularly until the World War knocked all precedents into a cocked hat. I heard that he and his large following lost millions before they desisted. But not even a world war can keep the stock market from being a bull market when conditions are bullish, or a bear market when conditions are bearish. And all a man needs to know to make money is to appraise conditions."

^^ that's pretty much what I do. But I can't do it on an intraday chart.

Always interesting Tim Wood commentary summarized as: Big money staging several run ups to shake out the weak shorts. Big guys long and trapped, small guys short. They want to make the small guys run up the price in a short covering panic so big guys can unload.

It's not going to work on me. There are several "failures" visible and the ominous H&S patterns all over the place are enough to keep me short, in Gold, and holding the first byte of RRPIX.

http://tinyurl.com/2vgr5a

Addendum: to play above link's audio, click link, then right click the speaker icon, cloose "save as" to a location on your hard disk. Play MP3 from there. I listen to these guys each week and find it entertaining as well as educational. Tim always makes me want to go fishing in the Gulf.

OG- thanks...i suppose the essence of trading is an attmept to game human behavior, and it's up to the individual to determine what mix of indicators works best for him...interesting comment re the 'behavior of a stock' and the warning about staying away if it isn't acting right...

can't count the number of times i sat in front of the TV in the seventies watching roger staubach pull off (yet another ) win in the final minutes of a game...the guy had poise, always seemed in control of the game, and came from behind so many times you started to think he enjoyed the clutch plays (probably did)...for that reason i tend to think that the best traders are ones who master the art of handling trades that go against them...once you get that down, there really isn't much else that can get in your way...

tim wood may be right, at least to the extent of needing an extended short-covering rally to work off the excessively bearish sentiment...which will then clear the way for the downward spike we're all waiting for...QID/SKF closed up today, but notice that DUG/SMN gapped back down near 52-wk lows...so the ST bias appears to be up->into which paring back existing longs remains a good idea...

for those who think it's now a casino (and i don't necessarily disagree), if we equate Banker with Bear, then i still see an excessive bias towards Banker which will shortly work its way to a bias towards Player...at which time equally weighted positions in your stable of ultra-shorts becomes a good bet...

of course, there is no sure bet (i'm estimating 70/30 odds), so i reserve the right to move my chips up or down at any time...;)

Interesting gold article.
http://tinyurl.com/2omv75

I'm not Mr. TA, but are we not seeing a triangle patter in the S&P not unlike the 2 we have seen in gold the past few weeks?

http://img120.imageshack.us/img120/7526/snptrianglent0.jpg

Financial Times acknowledges the possibility...

http://tinyurl.com/2p424m

Re: From the previous Financial Sense article, Gold: How High Will It Go?

quote: "So, how high will gold go? The correct answer is simple: as high as Dow Jones."

You have to ask then, how high does the Dow Jones Go? And which period do you choose for your comparison?

Its very possible Bob Hoye, and his technical analyst, Ross Clarke were very correct in their assumptions, by making a comparison of advances in the gold price to the cpi-deflated Dow. By now, they have abandoned their analogy, more or less because of the divergence of timing between the Dow and on-going advances in the Gold price.

http://tinyurl.com/2zpbu5

Found this in AU morning paper…no mention yet seen in US news
http://tinyurl.com/ypt9ut
Local stocks tumble on KKR debt fears
February 20, 2008
LOCAL stocks closed down sharply amid credit crunch fears after a report said US-listed KKR Financial has delayed big debt repayments.

With KKR having troubles, how does this bode for BCE takeover?

This was sent to press before the KKR announcement.
http://tinyurl.com/23p4yo

Next step are the CRTC hearings Feb 25.
http://tinyurl.com/27zycj

Long-dated BCE bonds are down 7.5% MTD. Some are down >25% YTD

http://tinyurl.com/yteg6p

Chart popped a bit passed previous resistance yesterday.

Looks like housing starts came in slightly less than expected, and CPI was slightly more than expected.

Unless I'm reading the raw data incorrectly. We'll see if the news outlets disagree with me in a few minutes...

FattyArbuckle..you shure happy now with that FXP...you can get out of the water now and throw away that snorkel?

FXP is quite the hot potato. If you don't like the price one day, just wait another. The main area of concern for me was a breakdown below 85.

Now I'll definitely be running back up the beach, getting out the towel and drying off.

Doesn't look like the futures mkts are liking the CPI data.

You have to wonder about the poor folks who were sucked into buying with all those people calling for rallies and saying that bottom was in, and that gold was going to 1,000, etc. It will be a great day for those loaded with the ultra shorts and puts :-). I hope you are still in Quentus. Patience pays off.

wavesmash, BCE might be very cheap today indeed.

Good morning.

Here are your Cara 100 Ratings Changes:

Downgrade:

GOL - to Market Underperform @ Avondale Partners

-------------------------------------------------

New report on ABX here:

http://tinyurl.com/34ex24

-------------------------------------------------

Have a great day.

Holding my nose and nibbling on a few shares of Cara 100 Dell on the buy alert and HPQ news.

Also a little INTC and GFI.

GFI - Last price on JSE in S. Africa (per Reuters @ 13:39GMT) was 10950 ZAc, or approx $14.23US. US last premarket trade was 13.80. Interesting discrepancy.

2nd: SNDK coming back at us. Looks like Seamus may have them put to him at his price.

All doom and gloom this AM.

GFI: 13.68 bid premkt.

Craig - There WAS a 3rd crack at GFI 14.10 (actually 14.18) yesterday, in the aftermarket.

ALOHA !!

JesseSLC ... Its good that you care about the environment and are socially conscious. I prefer not to pretend. I buy food at the lowest price and the best quality. Period ... To some degree I suspect Whole Foods has cashed in on the collective guilt of American consumers ... I used to shop at Whole Foods and I also shopped at Trader Joes and SafeWay when I lived in the San Francisco Bay Area. Here in Hilo, Hawaii I shop at Malama Market, SafeWay and WalMart and local Farmers Markets as well as my own backyard. The local SafeWay and WalMart here use locally grown produce. At the WalMart there is a "Farmers Market" right in front of their building full of fresh picked fruit and vegetables grown a few miles from the store. Sounds like a Whole Foods business model! Also a tourist bus stops at the Hilo WalMart so tourists can experience a Hawaii WalMart. Mostly the bus is full of Asian tourists.

In the past I have spoken of supply lines. Like SafeWay, Whole Foods depends on three day supply lines for their regional and national supplies. I have also spoken many times about the abundance of gold on the Titanic but the lack of life boats. In the end the life boats were more valuable and the gold is on the bottom of the sea today! I would say owning gold is no guarantee of eating. Chances are you will have a better chance with your own garden or farm.

I myself used to shop at the Berkeley,CA and Walnut Creek,CA Whole Foods. I found parking just impossible and the lot jammed up with BMW and Mercedes and Lexus. Its interesting how 8 million people can cram into a polluted, dingy city full of concrete and asphalt and then shop at Whole Foods and join the Sierra Club and actually believe they have somehow managed to secure enviromental credits. Based on my studies of homo sapien consumers we have never left nature the way we found it! There's no way you can live in a big metropolitan area like Los Angeles and not harm the enviroment! My cousin who lived in Los Angeles all his life and never smoked yet he died of lung cancer. My point ... if you want to save the enviroment go ahead I am behind you 100%. I still think the best way to accomplish that is to give up your vanity! That's not an easy task here in America ...

Want proof? Here is the METAL BABY look at the BABY ... The BABY tells the truth ... The BABY is all knowing ... The BABY shows you what "real wealth" and reality is!

Link: http://www.mii.org/images/baby.pdf

Pave paradise ... ya know?