I guess I was pretty lucky. I don't want to be a Jim Cramer type of stupid head, so I'll not just attribute all the gains to my skill. I couldn't believe I could get out at the daily high of HFU.TO. Anyway it's a gain of about 16% over 10 days, I'm pretty satisfied.
Also glad that my SKF is now at the money, just a bit disappointed that my SDD is still under the water. SRS I kind of know it's getting weak, guess I'll try to sell it next week in case market rallies back up.
Citigroup upgraded LEH, well I can't say they are wrong, but just that these days who will believe these analysts. Be careful because LEH and MER continued yesterday's downward move, specially MER had an accelerating volume with the downward price movement. I guess it's still too early to say US financials are bottomed.
Friday, March 28, 2008
Thursday, March 27, 2008
LEH and MER the next?
I am not sure about if they follow BSC. I'm just a chart reader, as I don't have insider information. Even if I read many news I don't think I can come up with an exact and correct answer.
So what my does chart say? Well it's very simple. Just look at the daily candlestick of LEH and MER. If you ignore the strong come back last Monday and Tuesday (assume it did not happen), LEH and MER are actually below the closing prices of March 14, Friday.
There are many other stocks and ETFs are at a similar situation. Although not lower than their March 14 closing prices, but pretty closed. Given that there are rumors that LEH and MER may the next shoes to fall, maybe the charts are saying something. We'll see.
So what my does chart say? Well it's very simple. Just look at the daily candlestick of LEH and MER. If you ignore the strong come back last Monday and Tuesday (assume it did not happen), LEH and MER are actually below the closing prices of March 14, Friday.
There are many other stocks and ETFs are at a similar situation. Although not lower than their March 14 closing prices, but pretty closed. Given that there are rumors that LEH and MER may the next shoes to fall, maybe the charts are saying something. We'll see.
Sunday, March 23, 2008
Gold price down, market up, then what?
My DGP dived. It went to as high as above $28, then went all the way down to $22.44. Many people believe the rate cut is closed to an end and therefore gold price stopped to go up. Well maybe they are right but I guess the story is still not close to the end. But in the meantime I acknowledge that people may be shifting out money from commodities, at least for a while (look at SLV and DBA as well). Commodity ETFs dropped pretty fast over the last few trading days, I think at least there should be a little rebound before it heads a bit more lower. I'll think about closing my DGP position, even for a little loss.
On the other hand, my SKF, SRS and SDD are now all in the red. I just read the charts myself, somehow I found that SRS is even weaker than the others (based on relative strength). I guess I'll try to find chance to close my SRS position, and maybe as a hedge to start a URE position, but keep my SKF and SDD position. As well, I may add more SDD if I see fit. I still like EEV, I'll see how it approaches the 50-day EMA (if it will) and may start a small position there.
Finally agricultural commodity ETF. The ultra long and short agricultural commodity ETF in Canada finally arrived, but with very little volume. DBA went down with other commodity ETFs over the last few days and actually made a double top, definitely a short term top. I'll see how it retreats back to the 200-day EMA and may start a small position in HAU.TO.
Watch the clips on Youtube about Jim Cramer incident on Bear Stearns. I think he is done, he lost all his credibility. I think people should learn something:
1. do not just believe what you see and hear from any media about investing
2. it is okay to be wrong, but not okay to lie
3. even former professional can be deadly wrong in this area because this area is dynamic
4. current professional can be deadly wrong too
5. that's why I say individual stocks are dangerous and may leave you no time to cash out and that's why I want to move my strategy mainly on ETFs but not individual stock
6. you should take care of your own money, not Jim Cramer
Bye bye Jim, I bought two of your books and I think they are well written. People may accept your wrong call but not your lies. I guess you are at least wealthy enough to live on your money (hopefully not all US dollar) till you die. I guess nobody wants to hear your comment on any stock anymore because you are proved not reliable. Just accept you don't know much about all stocks and you made wrong calls.
I understand I don't know much about individual stocks, that's why I'm making changes.
On the other hand, my SKF, SRS and SDD are now all in the red. I just read the charts myself, somehow I found that SRS is even weaker than the others (based on relative strength). I guess I'll try to find chance to close my SRS position, and maybe as a hedge to start a URE position, but keep my SKF and SDD position. As well, I may add more SDD if I see fit. I still like EEV, I'll see how it approaches the 50-day EMA (if it will) and may start a small position there.
Finally agricultural commodity ETF. The ultra long and short agricultural commodity ETF in Canada finally arrived, but with very little volume. DBA went down with other commodity ETFs over the last few days and actually made a double top, definitely a short term top. I'll see how it retreats back to the 200-day EMA and may start a small position in HAU.TO.
Watch the clips on Youtube about Jim Cramer incident on Bear Stearns. I think he is done, he lost all his credibility. I think people should learn something:
1. do not just believe what you see and hear from any media about investing
2. it is okay to be wrong, but not okay to lie
3. even former professional can be deadly wrong in this area because this area is dynamic
4. current professional can be deadly wrong too
5. that's why I say individual stocks are dangerous and may leave you no time to cash out and that's why I want to move my strategy mainly on ETFs but not individual stock
6. you should take care of your own money, not Jim Cramer
Bye bye Jim, I bought two of your books and I think they are well written. People may accept your wrong call but not your lies. I guess you are at least wealthy enough to live on your money (hopefully not all US dollar) till you die. I guess nobody wants to hear your comment on any stock anymore because you are proved not reliable. Just accept you don't know much about all stocks and you made wrong calls.
I understand I don't know much about individual stocks, that's why I'm making changes.
Tuesday, March 18, 2008
Big increase today
But as I always say we need to see follow through, namely, steady normal volume, white candlestick and not making lower low.
I should have got into SSO in Monday morning or so, well too late to get in. In fact, I got into SKF at $117, SRS at $105.25, SDD at $81.50 and HFU.TO at $12.37. I guess I made two mistakes here (although I still think in general, what I was doing is rational, though may not be profitable).
The first mistake is, my 3 short positions are 3 times bigger than the long one. I think there maybe still a bit upside before the market may go down again, so I should at least initiate the long position almost as big as my short one. The little relief is, I already have some money in two mutual funds and Nintendo, so not as bad as it could be. In fact, Nintendo went up by 3.7% today, I am considering liquidating it because I said I'll try to focus on ETFs in the future but not individual stock, at least not individual stock before I confirm bull market myself.
The second mistake is I used market order for my long position and limit order on my short position. Although eventually it turned out okay because the market up big anyway. But I think I should enter all orders in one way instead of different. Otherwise I may enter into one position but not all position which made my portfolio skews to certain way that I don't want.
Anyway, the 3 short ETFs I entered almost at the lowest price as of today. As I said there maybe still a bit more upside, so in the meantime I will not increase my short position. Even if I want to do so I may want to go SDD or EEV. FXP, SKF or SRS is only a second choice.
All 4 major US indices ETFs (SPY, DIA, IWM, QQQQ) were more or less about the same place as beginning of March. Market dropped and then there was the $200 billion liquidity program. Market dropped again due to Bear Stearns and Lehman Brothers and there was the rate cut. Will all these plans solve the problem? I don't know, I guess the follow through will tell me more.
On the other hand, DGP dropped all the way back to slightly below my entry price, quite disappointed. In the meantime I'll still adhere to my original idea that to add some more if gold back down to $950. I guess in the meantime gold will not trade exactly as the opposite direction of US dollar. So gotta to be very careful to consider adding or selling it.
I should have got into SSO in Monday morning or so, well too late to get in. In fact, I got into SKF at $117, SRS at $105.25, SDD at $81.50 and HFU.TO at $12.37. I guess I made two mistakes here (although I still think in general, what I was doing is rational, though may not be profitable).
The first mistake is, my 3 short positions are 3 times bigger than the long one. I think there maybe still a bit upside before the market may go down again, so I should at least initiate the long position almost as big as my short one. The little relief is, I already have some money in two mutual funds and Nintendo, so not as bad as it could be. In fact, Nintendo went up by 3.7% today, I am considering liquidating it because I said I'll try to focus on ETFs in the future but not individual stock, at least not individual stock before I confirm bull market myself.
The second mistake is I used market order for my long position and limit order on my short position. Although eventually it turned out okay because the market up big anyway. But I think I should enter all orders in one way instead of different. Otherwise I may enter into one position but not all position which made my portfolio skews to certain way that I don't want.
Anyway, the 3 short ETFs I entered almost at the lowest price as of today. As I said there maybe still a bit more upside, so in the meantime I will not increase my short position. Even if I want to do so I may want to go SDD or EEV. FXP, SKF or SRS is only a second choice.
All 4 major US indices ETFs (SPY, DIA, IWM, QQQQ) were more or less about the same place as beginning of March. Market dropped and then there was the $200 billion liquidity program. Market dropped again due to Bear Stearns and Lehman Brothers and there was the rate cut. Will all these plans solve the problem? I don't know, I guess the follow through will tell me more.
On the other hand, DGP dropped all the way back to slightly below my entry price, quite disappointed. In the meantime I'll still adhere to my original idea that to add some more if gold back down to $950. I guess in the meantime gold will not trade exactly as the opposite direction of US dollar. So gotta to be very careful to consider adding or selling it.
Monday, March 17, 2008
BSC worth $2? Your guess
I don't know if it worths $2 or more or less, that's not the point here. The point is, betting on one single stock, either up or down is dangerous for individual investor. Since we are not insiders, have no non-public information, no way you can play this game smarter than the big boys.
BSC may shoot back up to the teens, LEH may strike back by a lot tomorrow as well (in fact, it did strike back by a lot from $20.50 to close above $30 already, quite a come back). I don't know the answer. I only know I'm not smarter than other people, particularly not the big boys, so I'll try to avoid BSC and LEH, and many other financials.
I'm not surprised that many ultra short ETFs today exhibited red candlesticks, that is, opened high and closed lower. Some indices/ETFs are now again sitting at January's low and some are sitting at below January's low. Unless there will be more bad news coming into the pipeline, otherwise, in a short term, I think the market will take a rest here. I don't think it will shoot up very high, nor I think it will tank by a lot.
Still holding my DGP. I guess people started to think gold went up too fast over the last few months. Oil started to come down and it comes down fast. It's expected as it went up too fast from $100 to $111. Gold probably dragged down by the oil trend too. So in the meantime gold will hove around $950 and $1,000 I think.
Okay back to financials. I guess in the meantime it's too much on the attention that it will totally collapse, I'll try to avoid ultra long or short financials here. Ultra short real estate I may think about that but will only put very little money.
What about China or emerging market? Well I may want to shift to ultra short emerging market than China, because shorting China at this time maybe a bit too much.
On the other hand, I start to think about ultra short mid cap and small cap, MZZ and SDD. Since some indices may be forming a W-bottom (at least for a short term), I may put a little money in the ultra long S&P 500, SSO. I still think this is just a bear rally so don't want to be aggressive.
BSC may shoot back up to the teens, LEH may strike back by a lot tomorrow as well (in fact, it did strike back by a lot from $20.50 to close above $30 already, quite a come back). I don't know the answer. I only know I'm not smarter than other people, particularly not the big boys, so I'll try to avoid BSC and LEH, and many other financials.
I'm not surprised that many ultra short ETFs today exhibited red candlesticks, that is, opened high and closed lower. Some indices/ETFs are now again sitting at January's low and some are sitting at below January's low. Unless there will be more bad news coming into the pipeline, otherwise, in a short term, I think the market will take a rest here. I don't think it will shoot up very high, nor I think it will tank by a lot.
Still holding my DGP. I guess people started to think gold went up too fast over the last few months. Oil started to come down and it comes down fast. It's expected as it went up too fast from $100 to $111. Gold probably dragged down by the oil trend too. So in the meantime gold will hove around $950 and $1,000 I think.
Okay back to financials. I guess in the meantime it's too much on the attention that it will totally collapse, I'll try to avoid ultra long or short financials here. Ultra short real estate I may think about that but will only put very little money.
What about China or emerging market? Well I may want to shift to ultra short emerging market than China, because shorting China at this time maybe a bit too much.
On the other hand, I start to think about ultra short mid cap and small cap, MZZ and SDD. Since some indices may be forming a W-bottom (at least for a short term), I may put a little money in the ultra long S&P 500, SSO. I still think this is just a bear rally so don't want to be aggressive.
Saturday, March 15, 2008
Market confidence, what confidence?
So BSC collapsed. Well it's not a surprise that the Fed stepped up and provide helping hand again. There is a very good lesson to learn technical analysis here.
If you look back on Tuesday, market went up big, but BSC did not go up by much. In fact, its candlestick was red, meaning it went up to start with, only to go down to end. Look closer, it has been once dipped even below its Monday's low. Many stocks showed a white candlestick (although many eventually went back down to lower than Monday's low) with at least average 3-month volume. BSC showed a red candlestick with higher than normal volume. Then you saw the follow collapse on Wed, Thurs and Friday.
When market up big and a stock doesn't move, something must be wrong with that stock. You don't even need to know why, just avoid it or run if you are holding it.
Some news and columns are now saying that after these panic selling, market must be very close to a bottom. Well those are not panic selling at the first place, and I don't know if the selling is over. I guess the selling will only be over when all the di-leveraging completes.
Another piece of news I find very funny (and a bit stupid) is that, it says certain companies (in this case particularly banks) can go down to zero due to market loses confidence. Well, what's confidence??? I don't get it. Or you tell me as a bank, somebody borrowed money from me and now telling me he does not have money to repay me and I still have to trust that guy that he can pay me back in full? Be rational, if you are the bankers, what would you do? Trust that guy and extend the loan? No way, unless he puts up some collateral, which of course that guy has none.
If the bank sticks to its policy of lending, it definitely will call you for the money back, and stops lending money to suspicious customers. That is logic and rational. The bottom line is, you don't have collateral to put up, no proof of income, namely no credibility, why should I trust you?
Therefore, it's not about confidence, it's about no hard asset being put up as collateral. Otherwise, what about you go to casino to gamble with no money, but tell the casino that you will pay them back when you win, as you believe at some point, you will win. See what the casino will tell you.
If you look back on Tuesday, market went up big, but BSC did not go up by much. In fact, its candlestick was red, meaning it went up to start with, only to go down to end. Look closer, it has been once dipped even below its Monday's low. Many stocks showed a white candlestick (although many eventually went back down to lower than Monday's low) with at least average 3-month volume. BSC showed a red candlestick with higher than normal volume. Then you saw the follow collapse on Wed, Thurs and Friday.
When market up big and a stock doesn't move, something must be wrong with that stock. You don't even need to know why, just avoid it or run if you are holding it.
Some news and columns are now saying that after these panic selling, market must be very close to a bottom. Well those are not panic selling at the first place, and I don't know if the selling is over. I guess the selling will only be over when all the di-leveraging completes.
Another piece of news I find very funny (and a bit stupid) is that, it says certain companies (in this case particularly banks) can go down to zero due to market loses confidence. Well, what's confidence??? I don't get it. Or you tell me as a bank, somebody borrowed money from me and now telling me he does not have money to repay me and I still have to trust that guy that he can pay me back in full? Be rational, if you are the bankers, what would you do? Trust that guy and extend the loan? No way, unless he puts up some collateral, which of course that guy has none.
If the bank sticks to its policy of lending, it definitely will call you for the money back, and stops lending money to suspicious customers. That is logic and rational. The bottom line is, you don't have collateral to put up, no proof of income, namely no credibility, why should I trust you?
Therefore, it's not about confidence, it's about no hard asset being put up as collateral. Otherwise, what about you go to casino to gamble with no money, but tell the casino that you will pay them back when you win, as you believe at some point, you will win. See what the casino will tell you.
Tuesday, March 11, 2008
Big rally, so familiar
A big rally today. The news said it's one of the biggest one day point gains of DJIA since July 2002. Looks like people are happy about it. I think the rally is more on the news regarding the group of several central banks will lend banks about $200 billion to provide them some credit relief. US government (the Fed actually) initiate a new plan which will lend treasuries securities to the investment banks, take mortgage-backed securities as collateral, and let the banks to make money on the borrowed capital, and only to repay them in 28 days, instead of next day.
Will this method better than reducing the fed fund rate and discount rate I'm not sure, as the economic consequences can be very complicated and unpredictable. I'll first go back to my charts and check the reaction today.
Yes all indices went up by a lot today. The rally is pretty broad base too. However, I checked many US sectors ETFs and country ETFs, as well as the major 4 (DIA, QQQQ, SPY and IWM), none of them has blast through any meaningful resistance. I then checked some large cap names like all the banks, brokerage firms, some tech stocks and some other big names. Only a few of them has tested the 20-day EMA or the lowest EMA out of the 4 I usually use. As well, on some of the ETFs and large names, I don't see significant abnormal volume.
Given that kind of graphical result, I guess only if there is follow-through rallies and the rallies are strong enough to push those ETFs and stocks to test more major resistance (that is, the highest EMA and as well, at least bring the 20-day EMA to test the next closest EMA), otherwise, I cannot conclude and convince myself that market changes direction.
Funny gold and oil didn't drop due to this "good news". Oil went up by about 10% as I expected earlier since it broke $100. I would expect gold is the same kind of situation. If gold breaks $1,000, it will go up by about 10% very quickly. It may then go back down to below $1,000 before it will go up again. I think oil is doing this now. So in short term I think $110 is the top, as most of the short position around or below $100 should have been covered.
Still have my little position in DGP, the ultra long gold. I guess sooner I'll buy a bit more if gold dips to closer to $950, it that happens.
Will this method better than reducing the fed fund rate and discount rate I'm not sure, as the economic consequences can be very complicated and unpredictable. I'll first go back to my charts and check the reaction today.
Yes all indices went up by a lot today. The rally is pretty broad base too. However, I checked many US sectors ETFs and country ETFs, as well as the major 4 (DIA, QQQQ, SPY and IWM), none of them has blast through any meaningful resistance. I then checked some large cap names like all the banks, brokerage firms, some tech stocks and some other big names. Only a few of them has tested the 20-day EMA or the lowest EMA out of the 4 I usually use. As well, on some of the ETFs and large names, I don't see significant abnormal volume.
Given that kind of graphical result, I guess only if there is follow-through rallies and the rallies are strong enough to push those ETFs and stocks to test more major resistance (that is, the highest EMA and as well, at least bring the 20-day EMA to test the next closest EMA), otherwise, I cannot conclude and convince myself that market changes direction.
Funny gold and oil didn't drop due to this "good news". Oil went up by about 10% as I expected earlier since it broke $100. I would expect gold is the same kind of situation. If gold breaks $1,000, it will go up by about 10% very quickly. It may then go back down to below $1,000 before it will go up again. I think oil is doing this now. So in short term I think $110 is the top, as most of the short position around or below $100 should have been covered.
Still have my little position in DGP, the ultra long gold. I guess sooner I'll buy a bit more if gold dips to closer to $950, it that happens.
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