BIOTECH AND GOLD STOCKS

GS P&F

2010-06-24T09:12:00.000-07:00

6/24/2010
Rochdale analyst Dick Bove lowered his projection for Goldman Sachs [GS 133.64 -1.43 (-1.06%) ] earnings to $1.93 a share from his prior estimate of $2.93 a share, citing a variety of factors, including a slowdown in the economy and a hefty charge for a one-time bonus tax in London. Not only is the estimate a full dollar below his prior estimate, but it's less than half that of the mean estimate of $4.10 a share.

GS P&F Bearish

2010-05-15T06:03:00.000-07:00

Shares of Goldman Sachs Group Inc. closed down nearly 13% on Friday

2010-04-16T17:48:00.000-07:00

http://www.marketwatch.com/story/b-of-as-rising-home-loan-losses-weigh-on-banks-2010-04-16?siteid=rss

Obamacare

2010-03-26T19:56:00.001-07:00

So they just passed a health care plan written by a committee whose chairman says he didn't understand it, passed by a Congress that exempts themselves from it, signed by a president who smokes, with funding administered by a treasury chief who didn't pay his taxes, all to be overseen by a surgeon general who is obese... and better yet it is to be financed by a country that's broke? – Anonymous Facebook poster

Watch Goldman Sachs Group, Inc

2009-12-03T21:45:00.000-08:00

Is GS showing signs of a market correction? Our new canary replacing Merrill Lynch.

EA Approval for Terrane Metals

2009-12-01T11:43:00.000-08:00

Terrane Metals Corp.: Mt. Milligan Gets EA Approval From Government of Canada

GDXJ Junior Gold Fund Holdings

2009-11-29T09:23:00.000-08:00

Andean Resources Ltd (AND.TO)
Avoca Resources Ltd (AVO.AX)
Dominion Mining Ltd (DOM.AX)
Kingsgate Consolidated Ltd (KCN.AX)
Medusa Mining Ltd (MML.AX)
St Barbara Ltd (SBM.AX)
Alamos Gold Inc (AGI.TO)
Aurizon Mines Ltd (ARZ.TO)
Colossus Minerals Inc (CSI.TO)
Detour Gold Corp (DGC.TO)
European Goldfields Ltd (EGU.TO)
Fronteer Development Group Inc (FRG.A)
Gabriel Resources Ltd (GBU.TO)
Gammon Gold Inc (GRS.N)
Gold Wheaton Gold Corp (GLW.V)
Golden Star Resources Ltd (GSS.A)
Great Basin Gold Ltd (GBG.TO)
Jaguar Mining Inc (JAG.TO)
Kirkland Lake Gold Inc (KGI.TO)
Lake Shore Gold Corp (LSG.TO)
Minefinders Corp Ltd (MFN.A)
New Gold Inc (NGD.TO)
Northgate Minerals Corp (NXG.A)
NovaGold Resources Inc (NG.A)
Romarco Minerals Inc (R.V)
Rubicon Minerals Corp (RMX.TO)
San Gold Corp (SGR.V)
Semafo Inc (SMF.TO)
Silver Standard Resources Inc (SSRI.O)
Silvercorp Metals Inc (SVM.TO)
Ventana Gold Corp (VEN.TO)
Lingbao Gold Co Ltd (3330.HK)
Avocet Mining PLC (AVM.L)
Real Gold Mining Ltd (0246.HK)
Allied Nevada Gold Corp (ANV.A)
Coeur d Alene Mines Corp (CDE.N)
Hecla Mining Co (HL.N)
US Gold Corp (UXG.A

Watch China?

2009-11-24T16:23:00.000-08:00

China's Shanghai composite, which closes before New York's open, plunged 3.4% in heavy volume. It was the Shanghai's biggest one-day drop since late August. Is this our new canary in the coal mine?
Update:ok for me to blog--will continue with usual restrictions and cautions

I Passed My Series 65 Exam

2009-11-19T17:22:00.000-08:00

This afternoon I passed my Registered Investment Advisor Series 65 Exam. I found it moderately difficult and if I had realize the "trickiness" of some questions I would have spent more time in preparation. But I passed!!!

I plan to open a wealth Management office in Fort Smith Arkansas with an associate, Clint Sands, in January 2010 when my licensing is complete and our business plan is up and running.

I have been advised once my registration is complete that I should quit blogging and I will respct this advice. To all my readers I thank you for your comments and God Bless.

Paul I Wills, M.D., F.A.C.S.

TRX CLOSES AT NEW HIGH

2009-11-17T13:53:00.000-08:00

TRX.V (TERRANE METALS) CLOSED AT $1.33 UP ALMOST 15% . I THINK THIS STOCK CAN RUN, RUN, RUN. GOLDCORP MAY BE LOOKING AT THIS AS A POSSSIBLE TAKEOVER TARGET SINCE THEY PROVIDED LONG TERM FINANCING OF THIS PROJECT.

I TAKE MY REGISTERED INVESTMENT ADVISOR EXAM (SERIES 65) THIS THURSDAY AFTERNOON.

Broad Markets approaching a top???

2009-11-11T19:11:00.000-08:00

Watch for signs of collapse in chinese markets FXP

IBD has issued a buy signal.

JUNIOR MINING ETF

2009-11-11T19:08:00.000-08:00

A new ETF was launched today GDXJ

Should be fun to watch.

IBD Market in Correction

2009-11-04T16:59:00.000-08:00

TRX and Gold to all time highs

2009-11-03T19:13:00.000-08:00

PM prices continue Bull run on high volume.

Market in correction mode, TRX new highs

2009-11-02T18:42:00.000-08:00

Continue to watch distribution days and insider selling. Nonconfirmation signal by $TRAN and dow theory. TRX breaks out to new high. I predict broad market and $INDU will test March lows.

Terrane metals up

2009-09-23T16:06:00.000-07:00

Terrane Metals Corp. (Public, CVE:TRX) Watch this stock Find similar stocks Find more results for TRX S&P TSX Ven... 1,277.85 -0.29%
TRX 0.580 38.10%

0.580 +0.160 (38.10%)
Sep 23 - Close
CVE data delayed by 15 mins - Disclaimer Range 0.50 - 0.65 52 week 0.09 - 0.65 Open 0.50 Vol / Avg. 6.24M/0.00 Mkt cap 71.46M P/E - Div/yield - EPS -0.01 Shares 123.20M Beta 1.25

One blog site mentions 4 elephant deposits--has been granted mining permit recently.

Call for Audit of Federal Reserve Bank

2009-09-22T17:41:00.000-07:00

Why are you not screaming for an audit of the Federal Reserve Bank?

See this link
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=adjvXg1zP.zY

An audit will bring to the light of day severe conflicts of interest in how appointments for the bank are determined and also shed light on the Federal Reserve’s mismanagement leading to the severe financial crisis of ’08. Both political parties are equally responsible for the financial mess we are in. This crisis has hit those of retirement age the most and is a worldwide crisis but has hit the hardest in the USA.
http://www.moneymorning.com/2009/02/16/pension-relief/

I am a 66 yr old retired physician with over 3.5 million in assets but I am studying to become a Registered Investment Advisor and continue to self direct and manage my own retirement funds. I was fortunate to “time the market” and stepped aside in November ’07 from the stock market impending collapse.

Market remains in correction

2009-08-19T17:52:00.000-07:00

"Despite gains the past two days, the market remains in correction mode. That means stock purchases should be avoided until a major index triggers a follow-through day.
A follow-through involves a significant index gain in increased volume. It can't occur until the fourth day or later of an attempted rally.
An attempted rally begins with the first up day after the market goes into correction. The count continues as long as the index doesn't undercut the prior low.
The past two days of gains, therefore, constitute a rally attempt"
IBD today quote

Market Enters Correction and New Ideas for Health Care Reform

2009-08-17T17:10:00.000-07:00

IBD shows 5 distribution days and market in correction. I will sit this one out except for precious metal stocks. I suggest you watch the Asian markets closely for signs of possible financial panic. Too many people I know have lost jobs and two income families are struggling to get by on one paycheck.

I have been advised that once I become a RIA that I should discontinue this blog.

I plan to take the test in October. I am starting to adapt to my slowing down. I am training for a 5K run and plan on opening a wealth management office soon.

Today I jogged 1 1/2 miles and walked 1 1/2 miles. My USGA handicap index has dropped to 12 and my range of motion massage in the middle the afternoon was a far cry from my usual day in the O.R. doing 10 to 12 cases and then seeing 30 patients in the office--making a trip or two to the E.R. and taking night call every other night. My wife has a sign over our garage entrance that says, "a golfer and a normal person live here."

Last week my retirement party was a wonderful celebration of my life as an ENT surgeon--all 4 of my colleagues I practiced with attended and 60 other friends including my hospital CEO (retired) who made some very kind remarks about my contribution to our hospital.

My visit to Phoenix to the Barrow's Neurological Institute was very rewarding. A change of medication and a very good report otherwise. I wake up each morning grateful for having served in a "helping profession" and grateful for new challenges and trails to explore. I am taking a lot more time watching the river birds each morning outside my Arkansas River room and boat dock. My artifical putting green and swimming pool have finally been utilized the way I had intended them to be used. I will travel to my beloved Horse Shoe Bay Texas home soon for some Texas Hill Country golf when the weather cools.

I have a simple solution for health care reform--outlaw all medical advertising including pharmaceutical ads aimed at the consumer--make all insurance portable and expand medicaid coverage to all uninsured but use private insurance and individual and group medical practitioners in a Coop fashion. For those that say this is too simple a solution I say we did it before with tobacco advertising and the savings would be much better spent providing health care for the uninsured. I am not politically naive--I helped the AAOHNS andthe ACS form their political action groups. When Clinton was in office I visited with Hilary's Reform team about "MY Arkansas Plan for Health Care Reform." I much prefer capitalism and the free enterprise system and a "SEC Type" oversight would be much preferable than a massive Federal System--look how they have screwed up Social Security and the Post Office and now we trust our Government to run all of health care? Very few knowledgeable physicians or nurses would choose an inner city government run hospital over a well run Cleveland Clinic or Mayo Clinic or MD Anderson.
Email me at pwills@cox.net if you have inovative solutions and cost savings for a "privativation of health care".

Transports confirm Market Rally

2009-07-25T16:43:00.000-07:00

IBD market in confirmed uptrend
Dow Theory Letters--Richard Russell turns bullish but says this is still a rally in a bear market. Transport Ave confirms current rally.

On a personal note I have retired from the practice of ENT Surgery beginning July 1, 2009. I am pursuing continuing education to become a Registered Investment Advisor and plan to take the series 65 exam.

Uncertainies

2009-06-21T14:20:00.000-07:00

"If man will begin with certainies, he shall end in doubts; but if he will be content to begin with doubts, he shall end with certainties."

So here are my doubts:
1. Is the U.S. economy in deflation or inflation mode?
2. Is the current stock market rally a bear market rally or the start of a new bull run.
3. What is the current yield curve predicting?

Laffer: increasing Monetary base

2009-06-12T21:39:00.000-07:00

The percentage increase in the monetary base is the largest increase in the past 50 years by a factor of 10 (see chart nearby). It is so far outside the realm of our prior experiential base that historical comparisons are rendered difficult if not meaningless. The currency-in-circulation component of the monetary base -- which prior to the expansion had comprised 95% of the monetary base -- has risen by a little less than 10%, while bank reserves have increased almost 20-fold. Now the currency-in-circulation component of the monetary base is a smidgen less than 50% of the monetary base. Yikes!

Bank reserves are crucially important because they are the foundation upon which banks are able to expand their liabilities and thereby increase the quantity of money.

Banks are required to hold a certain fraction of their liabilities -- demand deposits and other checkable deposits -- in reserves held at the Fed or in vault cash. Prior to the huge increase in bank reserves, banks had been constrained from expanding loans by their reserve positions. They weren't able to inject liquidity into the economy, which had been so desperately needed in response to the liquidity crisis that began in 2007 and continued into 2008. But since last September, all of that has changed. Banks now have huge amounts of excess reserves, enabling them to make lots of net new loans.

WSJ Here comes Inflation

2009-06-10T19:51:00.000-07:00

http://online.wsj.com/article/SB124458888993599879.html

Monetary Base Doubled in Four Months

2009-06-09T19:53:00.000-07:00

For half a century prior to this bear market, the US monetary base had been expanding at an average 6% rate. No more -- over recent months the monetary base has sky-rocketed at an unprecedented rate of 110%. Within four months the Fed has doubled the monetary base. Nothing like this has ever been seen before in US history.

Follow this link traders vs physician income

2009-05-25T14:06:00.000-07:00

http://www.momdaytrader.com/blog/2009/05/10/day-traders-vs-physicians/

Simple Strategy:When to Buy Stocks

2009-05-23T19:22:00.000-07:00

When the S&P 500 Index is above its 45-week moving average, stocks compound at an astounding 11% annual rate. And when stocks are below it, they lose money at 6% per year.
Readers of this Blog know I remain long term bearish on the broad markets. I use IBD signals as confirmed by Dow Theory to generate buy sell signals. We remain in a bear market.
I urge any reader interested in economic cycles to read the work of Martin Armstrong (currently incarcerated) http://www.contrahour.com/ItsJustTimeMartinArmstrong.pdf

New Upleg for PM Stocks and Gold

2009-05-21T21:56:00.001-07:00

DO NOT ATTEMPT TO TRADE THIS BULL MARKET--STAKE A POSITION AND HOLD ON FOR DEAR LIFE--THIS IS A BULL MARKET WE HAVE BEEN PATIENTLY WAITING FOR!!!

Deflation and Japanese experience--asset bubbles

2009-05-15T23:05:00.000-07:00

"Although history never exactly repeats itself, I believe there are strong similarities about what happened in Japan and what could lay ahead for the United States. Driven by years of easy credit during the 1980s, the Japanese stock and housing market became a bubble - and everything changed when the bubble burst in 1990.

"One of the first lessons learned - or relearned, actually - is that when asset bubbles burst, there is nothing you can do to re-inflate them. But that's what every U.S. government plan is still trying to do - keep housing prices from falling. In doing so, all we are really doing is wasting trillions and trillions of dollars and digging ourselves into deeper financial hole.

"Another lesson learned from the Japanese experience is that plunging asset prices do not result in typical recession. The recessions are worse - sometimes far worse."
Campbells letter

Price direction of Gold

2009-05-14T18:25:00.000-07:00

http://www.goldstockbull.com/articles/ratios-best-way-to-determine-price-direction-of-gold/

Down Market Forecast for Tomorrow

2009-04-30T19:10:00.001-07:00

NDX probaility at 70% for down market

Down Market Forecast for Tomorrow

2009-04-30T19:10:00.000-07:00

NDX probaility at 70% for down market

71% probability for S&P UP market tomorow

2009-04-28T18:09:00.000-07:00

Bear Market Continues: Look for $INDU reversal tomorrow, another buy signal for gold and silver stocks

2009-04-26T20:18:00.001-07:00

PALISADES RESEARCH GIVE 74% PROBAILITY FOR DOWN MARKET TOMORROW. THE DOLLAR AND GOLD ARE BACK TO AN INVERSE RELATIONSHIP

BEAR MARKET CONTINUES

2009-04-22T19:58:00.000-07:00

Leading Indicators

2009-04-19T19:55:00.000-07:00

At first, something seems impossible. Then it becomes improbable. But with enough conviction and support, it finally becomes inevitable.” Christopher Reeves

“There are no rules here – we’re trying to accomplish something.” - THOMAS EDISON

Follow this link for some surprising economic indicators
http://www.cnbc.com/id/29257460

74% DOWN PROBABILITY FOR S&P TOMORROW

2009-04-13T20:10:00.001-07:00

Market Correction this Week?

2009-04-11T22:33:00.000-07:00

Obstacles are those frightful things you see when you take your eyes off your goal.
~Henry Ford

The Nasdaq has surged 31% from its March 9 low. The NYSE composite added 29% from its March 6 worst. The S&P 500 gained 28% and the Dow rose 25%.

The Market Pulse shows that a distribution day, one notched on March 20, has fallen off the count. The broad indexes have climbed enough to make that session's high-volume loss less relevant.

Is this a Bear Market Rally or New Bull Market

2009-04-05T16:34:00.000-07:00

A week ago Richard Russell said the if the Industrials and Transports can BOTH better their last secondary peaks, this will be very bullish, and it could mean that the primary trend has turned up.

The key numbers on the upside (the last secondary peaks) are:

D-J Industrial Average 9015.10, and

D-J Transportation Average 3717.26.

These points are identified by the blue arrows on the two daily charts above.

Short term gold and gold stocks have turned bearish--I do not plan to trade out of current positions--very difficult to correctly time--I am hedged to the down side with a small position in April AUY PUTS.

I am currently evaluating a deltra neutral straddle strategy for option trading. My 2 week experience has resulted in a loss thus far. I will keep my readers posted--the strategy was advertised to generate over $130,000 in 30 days with only 30 minutes work per day in picking trades.

God Bless and good fortune with all your trades.

Stocks Explode Higher Again On Rule Change, Economic Data

2009-04-02T21:12:00.000-07:00

UNTIL CONFIRMED BY DOW THEORY THIS IS A BEAR MARKET RALLY. Rmember I follow distribution days on IBD and use Dow theory to confirm major market trends. I believe we have entered a new bull market for gold mining and silver mining stocks. I have taken a 20% position in my retirement account.

Tomorrow look for profit taking--Gold bullion down but mining stocks continue up including SLW.

Recession severe, Great Depression no way

2009-03-30T07:45:00.001-07:00

ARNA releases positve study but the amount of weight loss not as much as wanted by market place--stock drops by 1/3 at open today. I still think this drug will be released after Sept phase 3 study report. I bought additional July call options today.

Follow this link for gold historical performance
http://seekingalpha.com/article/128358-as-history-repeats-itself-time-to-buy-gold-and-silver?source=article_sb_popular
I remain very bullish on silver and precious metal stocks.

God Bless and wishing you all a wonderful trading day.

Gold and Silver Stocks Safe Haven? Major Market rally

2009-03-23T16:35:00.001-07:00

I took a 20 % position in SLW, AUY, RGLD,GSS. ALS:TSX remains on my watch list as does the biotech ARNA (Phase 3 weight loss pharmaceutical product results will be released at end of month). Tomorrow I will take an additonal 2% position in ARNA.
http://news.alibaba.com/article/detail/chemical/100072785-1-interview-arena-nears-final-hurdles-obesity.html

While institutions and central banks are increasingly looking to gold’s safe haven attributes as portfolio insurance, retail investor sentiment remains lukewarm with only a minority of the investment public having any allocation to gold whatsoever and the vast majority of the mainstream media almost completely ignoring gold’s continuing outperformance of other assets and extremely strong fundamentals.

Media coverage of gold continues to be lukewarm and focuses on the fact that gold has not yet surpassed its record nominal high of $1,030/oz, which is pointed out repeatedly.

What is rarely pointed out is that gold rose in nearly all currencies in 2007, in 2008 and is up some 8% in dollar terms (more in euro and sterling and far more in other smaller currencies many of which have fallen very sharply) so far in 2009 in stark contrast to equity markets (see Performance tables below).

Disclosure: none

Fed Rings Bell

2009-03-18T16:31:00.000-07:00

http://finance.yahoo.com/news/Fed-launches-bold-12T-effort-apf-14683798.html

There is an old saying on Wall Street that no ones rings the bell--however todays action by the Fed comes as close to bell ringing that I have ever heard. I look for gold to soar and the dollar to tank. Buy april call options on SLW, RGLD, Auy. I prefer just out of the money options based on the underlying stocks price. This is a turning point--The FED is running the printing presses full tilt.

HOW LONG FOR THIS CURRENT RECESSION?

2009-03-16T20:59:00.001-07:00

Washington - America's recession "probably" will end this year if the government succeeds in bolstering the banking system, Federal Reserve Chairman Ben Bernanke said Sunday in a rare television interview.

In carefully hedged remarks in a taped interview with CBS' "60 Minutes," Bernanke seemed to express a bit more optimism that this could be done.

Still, Bernanke stressed - as he did to Congress last month - that the prospects for the recession ending this year and a recovery taking root next year hinge on a difficult task: getting banks to lend more freely again and getting the financial markets to work more normally.

IBD signals market rally

2009-03-15T11:03:00.001-07:00

Thursday marked a follow-through session for the market, on Day 5 of a rally attempt as reported by IBD. So has Dow Theory confirmed this bear market rally--or is it the start of a new bull market? Only time will tells us--I can interpret trends--I do not forecast the future. I am not smart enough. I also notice that when I take a market position my objectivity becomes clouded--I look for any evidence that supports my position and ignore the signals that are screaming at me to take my loss and regroup. Such is the life of a trader. I have been blessed by the good fortune of side stepping this vicious bear market--I moved to 90% TREASURIES IN November '07.

I plan to invest soon in this current market rally. I continue to hold a 10% position in precious metal mining stocks. I also look for a rally in the oil stocks and for the U.S. Dollar to decline markedly over the next year. Inflation should start to heat up over the next 6 to 9 months. I monitor the U.S. Dollar interst rates, TIPS, Gold and OIL. My favorite sector right now remains the silver stocks. I look for spot silver to spike as high as $50. I favor holding for 1 to 2 years--I get whipsawed every time I think I can time the precius market and gold trades. I also look for a huge rally in biotech stocks. My current favorite is ARNA.

The bear market peak for the Dow occurred in October 2007 at 14164. The recent low was recorded on March 9 at Dow 6547. This represents a total loss of 7617 points. A one-third correction would take the Dow back to about 9500. A two/thirds correction would take the Dow back to 11629. A 50% correction would take the Dow back to 10355.

ARNA, VVUS,OREX FOR WEIGHT LOSS

2009-03-07T21:36:00.001-08:00

If you want to speculate on biotech weight loss drugs take a look at ARNA. 2 other biotech stocks are VVUS, and OREX. I think biotech will be next sector to watch if and when a rebound comes for the broad markets. I am keeping a watch list of gold and silver stocks and biotech stocks.

SILVER BULL

2009-03-07T16:44:00.000-08:00

Now bullish on silver stocks: SLW, PAAS, SSRI

Gold stocks I like are: AUY, GDX, RGLD

GDP declined 6.2% in 4th quarter of 2008

2009-03-03T19:34:00.000-08:00

Real gross domestic product (GDP) declined 6.2 percent in the fourth quarter of 2008 after declining 0.5 percent in the third quarter, according to the Bureau of Economic Analysis. The fourth-quarter growth rate was revised down 2.4 percentage points from the “advance” estimate of a 3.8 percent decline released in January.
The sources of weakness were the same as those reported in the advance estimate.
•
A sharp downturn in exports
•
A continuing decline in consumer spending
•
A larger reduction in business investment
• A continuing decline in housing Imports, which are a subtraction in the calculation of GDP, continued to decline.
Quarter-to-Quarter Growth in Real GDP
7
5
3
1
-1
-3
-5
-7
2005 2006 2007 2008
Real GDP growth is measured at seasonally adjusted annual rates.
I II IIIIV I II III IV I II IIIIV I II IIIIV
Percent
Revision
The GDP revision was large. The revision reflected new source data that showed substantially weaker inventory investment and exports than BEA had assumed for the advance estimate. The average revision (without regard to sign) between the advance and preliminary estimate is 0.5 percentage point.
Prices
Prices paid by U.S. residents fell 4.1 percent in the fourth quarter, after rising 4.5 percent in the third quarter. The decline reflected a large downturn in energy prices. Excluding energy, prices rose 1.5 percent after rising
3.3 percent.
BEA data—including GDP, personal income, the balance of payments, foreign direct investment, the input-output accounts, and economic data for states, local areas, and industries—are available on the BEA Web site: www.bea.gov. E-mail alerts are also available.
NOTE: Additional information that becomes available in the coming weeks will be incorporated in a “final” estimate of fourth-quarter GDP on March 26, 2009. An estimate of corporate profits will also be released.
Contact: Ralph Stewart or Thomas Dail (202) 606-2649 Bureau of Economic

New Market lows, Gold stocks flash sell signal

2009-03-02T21:12:00.000-08:00

Where is the outrage. Bernacke, Frank and Dodd should resign immediately. Obama should lower taxes instead of raising them and the financial stimulus plan should send $200,000 directly as a tax rebate to each and every tax paying household. I see a one term presidency, civil unrest and $INDU below 5000---readers of this blog know that my prevous forecast was for $indu 7500 to hold. I now like silver mining stocks but am waiting for a short term buy signal soon.

Gold P&F Bearish, Silver P&F Bullish

2009-02-25T20:16:00.000-08:00

Let the charts do the talking

THE BEST 5 MINUTES IN CNBC HISTORY

2009-02-21T18:41:00.000-08:00

http://seekingalpha.com/article/121688-santelli-s-rant-a-watershed-moment

If you missed this you must view Rick Santelli's call for a Chicago Tea Party to stop the socialization of America.

Broad Market Continues Selloff, Gold over $1000

2009-02-21T17:53:00.000-08:00

REMEMBER MY JANUARY 29 BLOG POST WARNING ON FINANCIAL SHARES--WELL 34 HAS BEEN TAKEN OUT ---WATCH OUT BELOW --I EXPECT A 30% REBOUND BEFORE FINAL LOWS ARE POSTED LATER THIS YEAR--

http://seekingalpha.com/article/121688-santelli-s-rant-a-watershed-moment

New lows confirm Dow Theory Sell Signal

2009-02-19T21:53:00.000-08:00

The broad markets new lows today confirm the long term trend for the financial markets is down.

IBD signals Market in Correction

2009-02-17T18:22:00.000-08:00

The $Indu came near to taking out its November lows. If or when that happens look for another down leg in this bear market. Gold and gold shares remain strong. Follow the fed reports on the velocity of money for a marker of when we turn from deflation to inflation. Tim Knight predicts S&P to drop to 650 in a "soon" timeframe. 79% probability of a down S&P tomorrow predicted by Palasades research. Carl Futia predicts gold to 1100.

ANOTHER BLACK SWAN???

2009-02-16T20:12:00.000-08:00

Massive liquidation started this pm somewhere in Asia---ther could be a huge move to the downside tomorrow AM if the futures and overnight markets are correct. The US $ is up and gold is up--otherwise look out.

follow this link

http://market-ticker.denninger.net/archives/801-RED-ALERT-FX-Dislocation-In-Process.html

P&F CHARTS BULLISH

2009-02-06T20:58:00.000-08:00

CHARTS FOR $INDU, $TRAN AND $HUI ARE NOW BULLISH. IBD IN CONFIRMED RALLY. ALL THAT IS LACKING IS DOW THEORY CONFIRMATION. Strong buy signal for gold and major gold producers. "Gold is rising against all currencies" John Murphy says on stock charts.com. I like ABX (+90 strong uptrend), AUY, RGLD,SLW,NXG. I suggest buying a one half position ---wait 6 months and buy second position.
Please take the time to follow the link below. It will take many years for the U.S. economy to revive itself--if it ever does.

http://www.speroforum.com/a/17985/Economic-Collapse-the-Japanese-solution

$INDU and $TRAN P&F BEARISH

2009-02-04T21:43:00.001-08:00

GOLD REMAINS BULLISH

I LOOK FOR NEW LOWS SOON FOR $INDU AND $TRAN

broad markets sell off

2009-01-29T21:13:00.000-08:00

90% probability for down broad markets tomorrow. I look for anoter whipsaw for recent IBD buy signal---gold needs to hold $900 --gold stocks may get sucked down with broad market selloff.

Buy Signal $indu P&F CHART

2009-01-28T21:29:00.003-08:00

IBD gives buy signal but confirmation from dow theory will come $Indu and $Tran close above their January Highs.

Buy Sgnal for gold and Major Gold Producers

2009-01-24T17:31:00.001-08:00

The broad markets remain in a correction bear market mode except for NDX which has given a P&F buy signal. My readers will recall that for a buy signal for the broad markets I use the IBD signal which also must be confirmed by "Dow Theory"

Most of my readers have noticed the "Name Change" for this blog. The extreme market conditions and rapidly changing political and economic conditions of the past 2 years are the harshest financial environments of my life time. I have been involved in a study group led by my wife, Margaret in a book "The Divine Conspiracy". Margaret has been part of the "Centurian Program" led by the Chuck Colson ministries. A new world order or currency may well be the result of the currrent "Financial Conspiracy" we are now living thru. I have never been a "Gold Bug" but for the first time ever I am considering purchase of gold coins and a hand gun.

On a personal note I have been saddened by the CVA and coma sustained by my close friend Rex Russell M.D.--author of "WHAT THE BIBLE SAYS ABOUT HEALTHY LIVING"--During this past week I attended the funeral of my younger son's father in law Erwin Wood of Houston Texas and the funeral in Tulsa of a close college friend (I have known his wife for 62 years) Dennis Arnold who died of lung cancer. The deaths of close family and friends always causes me to reflect on "what matters most"--my deepest committment--my search for the simplicity that is found in Christ and the guileless candor of childhood--I am reminded to seek as the poet William Cowper exclaimed of God:
"Deep in unfathomable mines
of never ending skill,
He treasures up his bright designs,
and works his sovereign will."

I find in time of mourning and loss of family and friends my greatest comfort in accepting "His sovereign will" comes from old hymns of faith (La 3:23) and from the Old Testament Psalms: "My soul is weary with sorrow; strengthen me according to your word." Ps 119:28

Sell Signal Continues for Broad Market and Gold Stocks

2009-01-22T15:22:00.001-08:00

63% probability for down day NDX. I am "short" WFC.

SELL SIGNAL BROAD MARKET AND GOLD STOCKS

2009-01-09T19:06:00.000-08:00

2008's total job losses were reported to nearly 2.6 million, the worst year since 1945. IBD rally under pressure with multiple distribution days. Luck is the residue of design. It pays to be a winner.

Fate of Gold Stocks Near Term

2009-01-05T17:51:00.001-08:00

Double bottom breakdown on P&F gold chart and High Pole Warning Flag suggest near term breakdown of gold and gold stocks.

After recent rally many bloggers neutral, IBD distribution days

2009-01-05T16:03:00.000-08:00

"The session marked a distribution day for three of the four major indexes. The updated count now reads five for the Dow, four for the S&P 500 and three for the Nasdaq since Dec. 11. It's never a good sign when the market starts flashing multiple signs of selling in elevated volume. The Dow's five distribution days in the past 3 1/2 weeks raises questions about the health — and fate — of this rally." IBD 010509

Palisades Research gives 75% down probability for NDX for tomorrow (Tuesday)

NEW BULL MARKET CONFIRMED???

2009-01-02T21:20:00.001-08:00

Under Dow Theory today both Industrials and Transports simultaneously broke above their preceding December peaks. Note the fibonacci support levels--is this a bear market rally---at any rate I will now trade the long side of the broad equity markets.

How Much Time to Invest in Market Study?

2008-12-29T20:38:00.000-08:00

IT LOOKS LIKE ALL THE BLOGGERS ARE TRYING TO CALL THE BOTTOM OF THIS BEAR MARKET--I THINK IT IS GOING MUCH LOWER THAN MANY ARE PREDICTING. I ALSO THINK GOLD AND GOLD STOCKS ARE GOING TO SELL OFF SOON.

"If you are ready and able to give up everything else, to study the whole history and background of the market and all the principal companies whose stocks are on the board as carefully as a medical student studies anatomy, to glue your nose at the tape at the opening of every day of the year and never take it off till night. If you can do all that and in addition you have the cool nerves of a great gambler, the sixth sense of a kind of clairvoyant, and the courage of a lion, then you’ve got a chance." Bernard Baruch, legendary investor and advisor to presidents.

I continue to want to make things simple. One or two trades each week. Good money management. I spent several hours trying to decide if end of day Esignal would benefit my trading style.

Palisades Research gives a 70% probability for an up S&P day tomorrow.

Deflation, Inflation or Stagflation???

2008-12-23T09:34:00.000-08:00

Remember FCX as leading indicator?

Gold rallied 31 percent in 2007 as inflation rose at the fastest rate in almost two decades. Consumer prices dropped 1.7 percent in November, the most on record, as energy costs plunged. Crude-oil futures have plunged 74 percent from a record in July.

Will copper and oil and CRX drag gold down again? Gold: "The 885 level should prove to be resistance and the market should soon resume its move down into the 550-600 range." Carl Futia:

"Inflation Coming, But Not in Time
We expect that to change, but not in time to rescue debtors with a flood of cheapened money. We have told you for years to tune out the inflationists because they do not know their butt from a hole in the ground. That is still true. The inflation/stagflation they have been blathering about, and which materialized only fleetingly in the form of a speculative blowoff in commodities, was just a head-fake, a seduction whose purpose was to screw any investor who thought he could outsmart the first deflation ever to occur in the midst, paradoxically, of a global credit explosion.

It goes without saying that you should also tune out the self-aggrandizing charlatans who are saying the housing market and the economy will bottom “sometime next year.” These are the same unmitigated bozos who were insisting just six months ago that the economy would avoid a recession. Deflation will run its course no matter what the puny central banks attempt to throw at it next. It will take years to play out, and the price declines we have seen so far in the housing market are not even halfway to their bottom. As for gold, we will reiterate something we said here earlier: Even if it should fall to $200 an ounce, it is all but guaranteed to be do better, much as it has been, compared to nearly every other investment asset you could conceivably have chosen." Rick Ackerman
Dec 22 2008

I for one am very uncertain about the future.

Here is another opinion:

For the first time since 1940, the yield on the three-month Treasury bill went negative this month. Investors eagerly bought up a negative 0.01% yield. That means that they would rather lock in a certain 90-day loss than risk anything in the stock market.

Probability 72% for S&P up market tomorrow. Very light volume for trading until the end of the year.

My thoughts? First deflation, next inflation and then stagflation. Best assets when I get "buy" signals: Oil and gas stocks , gold bullion and gold producing mining stocks.

Watching a 2 year old girl and her 7 year old sister 24-7 for the last 4 days is like being on night call and going to the Emergency Department every night past midnight to stop a nose bleeds for 4 nights in a row. Our Horseshoe Bay home needs an expansion. Tonight we house 5 grandchildren ages 4 days to age 12 yrs, 6 adults, and 2 small dogs. The happiest I get is when I am with my 2 sons and their families.

Wealth and Happiness

2008-12-19T10:50:00.000-08:00

Wealth is the parent of luxury and indolence, and poverty of meanness and viciousness, and both of discontent. Plato (427 BC - 347 BC)

Today I experienced what I call the joy of true happiness. The birth of my second grandson:Fisher Andrew Wills.

My life experience tells me that there seems to be no correlation of wealth and happiness.
http://www.eurekalert.org/pub_releases/2004-09/aps-wdn092404.php

NEW GOLD AND GOLD SHARES BUY SIGNAL, 86% probability down S&P tomorrow

2008-12-17T21:15:00.000-08:00

WEEKLY $GOLD,$HUI,$XAU,RGLD, GIVE BUY SIGNALS. Negative is crude oil delationary and $INDU has not bettered November high. I remain 95% in T bills except for my small trading acount. I am accumulating data for probability forecast for next day broad market direction. Also as noted below a number of medical, personal and professional distractions during this holiday Season. I chair the patient safety committee at my hospital and operate 3 days a week and see patients 5 half days a week. My very early Parkinsons disease is in excellent control but I plan to move to a clinic only practice soon.
I have been busy with family and work--I still take ENT surgery call every other night thru the week and every third weekend. Tomorrow I travel to Horseshoe Bay for holidays and grandson #2 is scheduled for delivery Friday (grandchild #5).
I look for a sell off of the broad market to elevate the VIX and then a good rally over several months--of course this rally may have already started. Until inflation is firmly established via home prices stable, oil and gold prices rising I will remain in the safety of treasuries. I will trade some gold options both long and short--I prefer RGLD as a trading vehicle. My UBB most recent trade is blowing up.

Would my readers please comment --some have complained that the charts are too difficult for them

FCX fails to confirm GOLD STOCKS SELL SIGNAL

2008-12-01T18:59:00.000-08:00

The charts tell the story. I remain short via RGLD puts.

RGLD AND CONFIRMATION BY FCX??? at a Crossroads

2008-11-27T07:59:00.001-08:00

If FCX will confirm and RGLD breakout to new highs on heavy volume it will be off to the races. For the time being I am short with a tight stop RGLD dec puts.

HAPPY THANKSGIVING

2008-11-27T07:44:00.000-08:00

My Presbyterian roots are showing up in my posts: This morning I awoke singng the Doxology.

Praise God, from Whom all blessings flow;
Praise Him, all creatures here below;
Praise Him above, ye heavenly host;
Praise Father, Son, and Holy Ghost.

Click on the link below and give praise to our Father God and Creator.

http://www.cyberhymnal.org/htm/p/r/praisegf.htm

Has an up leg of new bull market started???

2008-11-26T20:54:00.000-08:00

The Long Tail Up pattern forms when the price rises twenty boxes or more. It is the reverse of the Long Tail Down pattern but with less chance of a being profitable. I am not convinced that new bull market for $indu has started but when the facts change I will change my opinion. My work shows a 75% probability for a down market on Friday. Airline traffic is down 7% this thanksgiving season.
My wife Margaret and I are with my older son Alan and his wife's family in Tyler Texa for Thanksgiving. On to horseshoe bay Friday.

Wishing you and yours a blessed Thanksgiving day.

Gold Buy Signal

2008-11-24T21:38:00.000-08:00

Today I took $6000 profit on RGLD option play. I am still short the market with UBB put. I see this 2 day rally in $indu as a bear market rally and will aggressively short it. If RGLD breaks out to new highs will also take a 10% position of gold producers RGLD AEM NM AUY etc. in my pension profit sharing plan.

"In this respect the present crisis in the West will ultimately end up discrediting mechanical monetarism -- and with it the fiat paper-money system in general -- as the U.S. paper-dollar standard, in place since Richard Nixon broke the link with gold in 1971, finally disintegrates.

The catalyst will be foreign creditors fleeing the dollar for gold. That will in turn lead to global recognition of the need for a vastly more disciplined global financial system and one where gold, the "barbarous relic" scorned by most modern central bankers, may well play a part." Chris Wood WSJ 11/24/08

Market forecast: continue down $indu and $tran this week

2008-11-23T20:19:00.000-08:00

Dow theory last week confirmed a continuing bear market with new lows for both averages. Gold stocks $HUI gave a buy signal Friday. We need a strong follow thru day to confirm this buy signal. So Citibank is too big to fail but Lehman Brothers got the Ax.

This week I travel to Tyler Texas and later on to Horseshoe Bay. I hope to soon move this blog to a new site and a new name: Counterculturaltrader.com

May mercy, peace and love be yours in abundance.

Paul Wills, M.D.,F.A.C.S.

BUY SIGNAL FOR GOLD & GOLD STOCKS

2008-11-21T16:00:00.000-08:00

Today, 30 minutes after the open, I bought RGLD Dec 35 calls (I have high hopes for this trade as it immediatedly was in the "green" a +$5000 by the afternoon close). I also hold Dec UBB puts. My IMCL calls expired worthless today. I am excited by the early results of my "next day $indu forecaster"--I am backtesting and assigning probability statistics to this new tool.

A huge move up in gold today. Yesterday a very unusual movement in interest rates as the markets made new lows--The long bond futures -- if you include the day session AND the after-hours session -- were up 7 9/32 points in price. The cash 30-year bonds were up 8 31/32 points. The yield on the 10-year Treasury was down 33 basis points to 2.99%, while the yield on the 2-year Note wasdown just under 10 basis points to 0.96%. These are not typos. These are, however, the biggest price increases I have ever seen, and the lowest yields in the history of each bond maturity.

In 10 months my small trading account is now plus $63,000. I am enjoying the teaching aspect and mentoring of my junior associate, Shannon Gram. The first book I gave her to read before starting to trade was on self discipline. The second lesson I taught her was on money management and position or bet sizing. The next lessons were review of my 3 trading rules. (the fewer rules you have the better--when my sons were growing up I had only one rule for them--they were not to get married until they were age 26--they both later married at age 26)
Also I am really big on positive mental images and positive self talk. I told Shannon, "great traders have ice water running thru their veins. You must treat your trading account as a small business. Only 5% of traders survive long term."

Currently we are developing entry and exit strategy for our swing trading. We use fibonacci retracement levels to pick support and resistaance levels. I tell Shannon that these are the most dangerous and volatile markets of my lifetime. However with the volatility comes great opportunity. Shannon is studying the biotech sector--I want her to get to know these stocks well. I have some knowledge of the gold mining stocks but have learned that I am not a gold bug and I am not married to any sector. We use Zacks and Investor Business Daily to "grade" each of our stock trades---we use a check sheet prior to entry of each trade and do a postmortem check after each trade--win, lose, or draw.

The stock market is telling us that something terribly bad is awaiting us in the future. Cash and treasuries remain king and now a small holding of gold shares or a gold ETF make sense. Yesterday both $Trans and $INDU made new lows--I have revised my near term low forecast for $indu to 7100. I now think that gold will rally and we may even see up to $1000 smash up in a day if a short squeeze happens in December.

Sunday I will post my market forecast for Monday. For those of us of Judeo-Christian beliefs our trust is in a personal God who created us, sustains us and cares for us now and into the future. Your 401K may be a 101K but we still have so much to be thankful for this Thanksgiving season. No amount of money will buy good health, productive happy children and grandchildren or the love and support of a lifetime spouse. This holiday season give a special prayer and say thank you to our servicemen who guard and protect our U.S.A.

Short UBB Dec 45 puts

2008-11-20T18:20:00.000-08:00

Palisades Research forecast 63% probability up market for Friday. IBD market in correction. I remain bearish in my long term and short term forecast. Gold point and figure chart is now bullish.
How low do you think this $INDU market will fall?

2008-11-19T17:55:00.000-08:00

Taking the contrarian position to the blog sentiment readings would be highly profitable recently.

U.S. stocks slammed to five-year lows as financials fall

2008-11-19T16:00:00.000-08:00

Today the $indu confirmed the $tran with new lows--the bear market continues.

$indu may correct to as low as 7100 on this leg of the bear market. $Gold may correct to as low as $550. Can you spell DEFLATION??? Once this bear market is over we can look forward to hyperinflation. Watch the price of gold and the price of oil.
I covered my UBB put option at a nice profit today.

Forecast S&P up Tuesday

2008-11-17T17:02:00.000-08:00

Palisades Research gives an 80% probability for an up S&P market tomorrrow. IBD shows market in correction. I have been mentoring a research associate and helping her learn to trade. She is working on our spreadsheet to give a probability forecast for the market direction for the next day trade. Her first trade was a loser but her second trade was a 100% gainer. Her MHK put hit her limit order target today. I patiently wait for the signal to go long gold stocks and will also purchase a gold and a silver ETF.

2008-11-16T17:00:00.000-08:00

Market Forecast Down For Monday

2008-11-15T07:58:00.002-08:00

IBD shows market in correction and Palasades Research predicts a 72% probability for a down Market Monday.

I find I am not the only one critical of Paulson. This observation comes from former Republican majority leader Dick Armey, "Paulson's very public and frantic panic of a few short weeks ago, along with his current state of bewilderment and indecisiveness, is most likely the single greatest explanation for the persistent doldrums in the markets..."

WHIPLASH REVERSAL DAY

2008-11-13T16:36:00.000-08:00

One day after IBD signaled "market in correction" the broad markets reversed and handed anyone who was "short" a severe nosebleed. I escaped with a profit on my mhk trade but my ubb trade is in the red. The up probability for the S&P is 65% tomorrow.
Given the severity of this bear market I don't think many traders will go home "long the market" over the weekend and I predict another wild ride for tomorrow. So how many of my readers think the bottom is now in for this bear market?
Before you get too excited about today's market upsurge consider this:
On Oct. 10 the Russell 2000 made a new low for the move before closing with a bullish reversal. Then, 12 sessions later on Oct. 28, the index made another new low for the move, once again with a bullish reversal. Today, 12 sessions later--another low, another bullish reversal.
Such action is actually part of a bearish pattern. Lower lows and lower highs are classic bear market behavior or to use a very old cliche, til the Fat Lady Sneezes (or do they sing at the start of a new Bull market?)

HOLD ON TO YOUR PARACHUTE: THE BIG DROP ARRIVES

2008-11-12T17:38:00.000-08:00

It's not the strongest of the species that survive; nor the most
intelligent, but the one most responsive to change.
---Charles Darwin
Only 1 new high with 542 new lows on NYSE today. IBD whipsawed again--market in correction--their euphemism for the BEAR MARKET FROM HELL

After hours:
Intel Corp. whacked more than $1 billion from its fourth-quarter revenue forecast and ratcheted down its profit expectations because a clampdown on spending is reducing demand for its chips.
I look for new market lows tomorrow. I remain short the market with ubb and mhk puts.
Ticker Sense Blogger Sentiment Poll reports 21.74% Bearish and 65.22% Bullish. Looks like every blogger out there is trying to call the bottom. Hmmm--I think I will let the market call the bottom.

$INDU REVERSES -- NEW LOWS AHEAD SOON

2008-11-10T18:15:00.000-08:00

"Bear Market - A 6 to 18-month period when the kids get no allowance, the wife gets no jewelry and the husband gets none."

Forecast for Monday

2008-11-08T21:54:00.000-08:00

We should see continuing rally Monday and then a sharp selloff Tuesday -Friday. I will enter another short trade of UBB if 75 is achieved.

$HUI is bullish. There is talk of a squeeze coming in December at the Comex and that gold could rise as much as $1000 in one day. I look for a full stock market crash before this happens.

REVENGE OF THE REPUBLICANS CONTINUES

2008-11-06T19:51:00.000-08:00

Today I closed my UBB put position. My small trading account begun in Feb is now plus $48,432. The bulk of the profits have come from the short side trading puts on UBB--3 trades all very profitable. I am working on a spreadsheet with a proprietary market direction indicator that will give next day market direction with probability forecasts. Today my prior projctions for 1500 point decline in $indu was completed. I look for a rally tomorrow and Friday and continuing into early next week. At this time I am "Flat and Nervous" except for an IMCL nov 70 call position.

"If you had an average investor standing in front of you, what would you say to him/her to ease concerns and raise confidence in the economy and markets?

I would say develop or stick to a valid trading plan and have the discipline to execute it correctly. In my opinion, "buy and hold" is a dangerous concept in today's world. That's because investors who have lost 30% in this bear market now need to make 50% to get back to breakeven and so have put themselves years in the hole. The S&P 500 has generated negative returns for eight years, but with an actively managed portfolio, investors still have the opportunity to make gains and move toward their financial goals". 11/06/08 by John Nyaradi.

Fibonacci Retracement

2008-11-05T20:29:00.000-08:00

I will affectionately refer to this Obama selloff as the "Revenge of the Republicans".
So far I have left politics out of this blog. I prefer for the markets to do their own talking. There are plenty of idiots on both side of the aisle.

SHORT UBB

2008-11-05T19:55:00.000-08:00

Today's forecast: Negative market forecast for Thursday. Tim Knight is bearish and looks for Spy to trade as low as 86. Palisades Research give Down market S&P at 74%. I will add to short position on any rally tomorrow.
I am thankful that the Obama selloff saved my UBB put option and I will exit if the target is hit tomorrow or Friday.

OBAMA RALLY

2008-11-04T19:48:00.000-08:00

I plan to fade this current rally--I think the bear market is still in position. Does anyone know of time price software using fibonacci relationships? Gold was strong today. I'm taking heat on my UBB put--if stop is hit I will exit this trade tomorrow.

UBB rises on merger news. S&P Lower

2008-11-03T13:00:00.000-08:00

No selloff yet. S&P lower as predicted.

http://www.marketwatch.com/news/story/brazils-banco-ita-unibanco-merge/story.aspx?guid=%7B4B7B124A%2D522A%2D48C3%2D812A%2D2C30A04303DE%7D&siteid=yhoof

Prediction: Market Corrects Again Next Week

2008-11-02T16:53:00.000-08:00

56% probability down market for S&P tomorrow. IBD is on a buy signal--will they be whipsawed again???
I use Dow theory to confirm IBD timing signals and like to see blogger sentiment fail to confirm. I also like P&F charts for $INDU, S&P, NDX and NYSE Bullish percent indicator ($BPNYSE) to confirm market trends. I was wrong about selloff I predicted for Friday--I remain short this market with tight stop for my UBB put.

Look for big selloff again tomorrow

2008-10-30T19:39:00.001-07:00

I punted my AEM put today at a small loss. $Gold failed to rally and confirm this trade. In after hours trading stocks are sharply lower. Probability of NDX bearish tomorrow is 71%.

I AM TRADING THIS WITH A UBB PUT OPTION.

Please send this site on to your friends if the correct timing and market direction are helpful to you. Using optionone service and my own timing signals I have made a lot of money trading these very volatile markets.

This site is now McAfee Secure.

LONG AEM DEC CALLS

2008-10-29T20:32:00.000-07:00

Palisades Research give 53% probability for S&P UP DAY tomorrow. Tim Knight remains bullish. AEM and FCX P&F turn Bullish.

Forecast for a big plunge in $Indu was wrong--only got 750 points down and then todays huge reversal

2008-10-28T21:47:00.001-07:00

The low pole reversal is seen when a chart falls below a previous low by at least 3 boxes but then reverses to rise by at least 50 percent of the fall. The reversal implies that the supply that was making the prices fall has been absorbed and demand is taking over. The pattern is an alert that higher prices could be seen in the future. The ideal buy point would be on another reversal back down to be closer to the stop loss point. This would also set up a double top breakout if the prices reverse up and break over the current column's high.

Tim Knight has a very near term accurate record in calling this market---bullish, Palisades Research gives only 47% probability for rising S&P tomorrow.

Was this the reversal day? Looking for bottom for gold stocks

2008-10-28T21:19:00.000-07:00

"In the latest commentary regarding the situation on the market, I suggested that we might get a very rapid pull-back in the precious metals stocks, ALONG WITH THE TURNAROUND IN THE GENERAL STOCK MARKET. So far this turnaround did not materialize, but instead we’re experiencing a monster rally in the USD, which naturally puts the pressure on the prices of precious metals and corresponding shares. As a result we have plunging prices of even the best precious metals stocks.
The big money is made by being brave while others are fearful and nobody should argue with the fact that most investors are currently terrified. Since that is the case, the question that we need to ask ourselves is ‘how will I take advantage of this opportunity’. Vast majority of investors will not take it at all, as people tend to act on emotions, not on the common sense - buying here is ‘way too scary’ for most investors. The easy way to play it is to wait until shares are back up and then buy. The problem is that at that moment this extraordinary buying opportunity will be over. You want to buy low, right? Aren’t the prices low already? Aren’t everyone and their brother bearish on stocks of any kind, including PM stocks? Then it seems that this is the time to take action. I am going to use most of my cash reserves to purchase precious metals stocks and especially call options on them.
As you know (updates and alerts were sent), during this decline I engaged in a few speculative transactions. Because of the volatility and the declining trend, these were risky transactions and most of them did not play out as expected. Yet, the overall rate of return is impressive, as one transaction with extraordinary profit is more than enough to compensate the losses. Therefore, the speculative part of my portfolio compensated to a certain extent the losses on my long-term holdings. The word ‘losses’ is purely theoretical, as they are all paper losses. I don’t intend to sell at these prices, although I will switch the juniors that are acting weak to those, who held up relatively well during this plunge.
Did we bottom yet? I don’t think so, but we are very close. As mentioned earlier, we now have the best companies in the sector (in my view that is), including AEM and KGC underperforming other companies from the sector. This usually takes place near or at the end of the fall. We have the general stock market (SPX) reaching a long-term support level – the low of 770. I therefore expect to see at least a temporary bottom in the SPX somewhere in the 770-810 range. According to my calculations this should correspond to the 125-135 level in the HUI and this is where I plan to buy aggressively. As far as gold is concerned, it should not go lower than $630.
The stocks that I plan to purchase are GDX, AEM, GOLD and optionally KGC, FCX, BVN - depends on the market situation. I currently favor gold stocks over silver stocks, as gold tends to perform better in the first stages of a rally, whereas silver usually catches up later. The bottom should materialize on a very high volume – if it is not, I will not proceed with purchasing options (only stocks), as the probability of that day being in fact a bottom will be too low." source recent gold price newsletter

MARKETS TREND LOWER

2008-10-27T16:31:00.000-07:00

There are still more bulls than bears this week. Palisades Research give 65% probability for S&P to close up tomorrow. Tim Sykes is bullish. Carl Futia is bearish: Spiders - December S&P E-mini Futures: The market will probably drop into the 800-10 zone before staging a 300 point rally. I will remain bearish until Dow Theory and IBD give me the signal for a counter trend rally.

Inflation Bailout

2008-10-26T21:18:00.000-07:00

"There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose." Lord John Maynard Keynes (1883-1946), renowned British economist.

DEFINITION OF INFLATION:
Inflation is the loss of constant purchasing value of the dollar,
caused by an increase out of 'thin air' of the supply of money and debt creation by the financial system

http://www.investmentu.com/IUEL/2005/20051212.html
See this site for linkage of gold and inflation

After the current washout by hedge funds and forced liquidation by margin clerks I think there will be a huge rise in the price of gold. I will wait for confirmation by my usual signals.

Technorati Profile

2008-10-25T21:03:00.000-07:00

Please help me generate more visitors to this site. Any suggestions are welcome.

Down Down Down Volatility Surges

2008-10-24T23:20:00.000-07:00

Tim Knight says this was second day we should have crashed but didn't--things are looking up for the bull's.

Probability for next day: Palisades Research

S&P down 73% -1.39%
NDX down 80% -2.94%

With the volatility index at all time highs I wouldn't try to pick the bottom of this market panic.

Bank Failures

2008-10-24T23:12:00.000-07:00

U.S. bank regulators Friday closed tiny Alpha Bank & Trust in Georgia, the 16th U.S. bank to fail this year as the weakening economy and falling home prices take their toll on financial institutions.

Certainly the FDIC’s and the banking industry’s challenges so far haven’t come close to the challenges of the 1930s and 1980s. Some 9,000 banks failed in the four years before Congress created the FDIC in 1933. Thousands of institutions also failed during the S&L crisis.