In a nutshell, the Currency Wars were best summarized in simple, easy to understand language by Bruce McCain of Key Private Bank: "Everyone is trying to get out of the economic doldrums by exporting and everyone is trying to do it at one time."
So that's what is going on this weekend.
The U.S. will probably win in negotiations as it is the world's largest economy. If the U.S. economy improves, the world economy will improve is probably going to be our pitch to other countries.
Also, when you look at most currencies, the U.S. dollar is in a strong downtrend while most currencies are in uptrends. So you have to understand that scaring people about the Currency War is a good way to get people to tune-in to your publication but a lot of it is just typical hype.
So far in the earnings season, with 1/3 of companies on the S&P 500 reporting, we have some great positive totals. About 75% have reported higher earnings per share than analyst forecasts, according to Howard Silverblatt, the senior index analyst at Standard and Poor's.
S&P 500 Daily Chart
With 3 bullish indicators out of 5, there is a 60% probability that the strong uptrend will continue.
In a nutshell, the Currency Wars were best summarized in simple, easy to understand language by Bruce McCain of Key Private Bank: "Everyone is trying to get out of the economic doldrums by exporting and everyone is trying to do it at one time."
So that's what is going on this weekend.
The U.S. will probably win in negotiations as it is the world's largest economy. If the U.S. economy improves, the world economy will improve is probably going to be our pitch to other countries.
Also, when you look at most currencies, the U.S. dollar is in a strong downtrend while most currencies are in uptrends. So you have to understand that scaring people about the Currency War is a good way to get people to tune-in to your publication but a lot of it is just typical hype.
So far in the earnings season, with 1/3 of companies on the S&P 500 reporting, we have some great positive totals. About 75% have reported higher earnings per share than analyst forecasts, according to Howard Silverblatt, the senior index analyst at Standard and Poor's.
S&P 500 Daily Chart
With 3 bullish indicators out of 5, there is a 60% probability that the strong uptrend will continue.
In a nutshell, the Currency Wars were best summarized in simple, easy to understand language by Bruce McCain of Key Private Bank: "Everyone is trying to get out of the economic doldrums by exporting and everyone is trying to do it at one time."
So that's what is going on this weekend.
The U.S. will probably win in negotiations as it is the world's largest economy. If the U.S. economy improves, the world economy will improve is probably going to be our pitch to other countries.
Also, when you look at most currencies, the U.S. dollar is in a strong downtrend while most currencies are in uptrends. So you have to understand that scaring people about the Currency War is a good way to get people to tune-in to your publication but a lot of it is just typical hype.
So far in the earnings season, with 1/3 of companies on the S&P 500 reporting, we have some great positive totals. About 75% have reported higher earnings per share than analyst forecasts, according to Howard Silverblatt, the senior index analyst at Standard and Poor's.
S&P 500 Daily Chart
With 3 bullish indicators out of 5, there is a 60% probability that the strong uptrend will continue.
There's certain days when the mainstream media falls down on the job of reporting activities in the stock market.
Today was one of those days.
China stocks continued their strong uptrend today which mostly went un-reported by mainstream media.
I wrote back in September that China stocks looked hot. I have since not been disappointed with my prophetic outlook.
Daily Chart of iShares China 25 (FXI)
I rate this chart as being in a strong uptrend.
What's most impressive is the Accum/Dist indicator that shows heavy accumulation in China stocks on pullbacks.
Notice also the breakaway gap up that took place on Wednesday, October 13, 2010. It looks very much like the gap up that occurred on September 13.
The three china stocks that I really like are LDK, TSTC, and XIN.
Daily Chart of LDK Solar (LDK)
I'm currently long in this stock. I've made a lot of money trading in and out of this stock. In fact, it's been my top money making stock pick for 2010.
The bullish Resurrection Cross back around $10 was big.
This stock is currently in a strong uptrend.
In the video below, I look at the stock charts of TSTC and XIN, two more hot china stocks in strong uptrends.
The best way to play strong uptrending China stocks is to buy on Fibonacci Retracements.
There's certain days when the mainstream media falls down on the job of reporting activities in the stock market.
Today was one of those days.
China stocks continued their strong uptrend today which mostly went un-reported by mainstream media.
I wrote back in September that China stocks looked hot. I have since not been disappointed with my prophetic outlook.
Daily Chart of iShares China 25 (FXI)
I rate this chart as being in a strong uptrend.
What's most impressive is the Accum/Dist indicator that shows heavy accumulation in China stocks on pullbacks.
Notice also the breakaway gap up that took place on Wednesday, October 13, 2010. It looks very much like the gap up that occurred on September 13.
The three china stocks that I really like are LDK, TSTC, and XIN.
Daily Chart of LDK Solar (LDK)
I'm currently long in this stock. I've made a lot of money trading in and out of this stock. In fact, it's been my top money making stock pick for 2010.
The bullish Resurrection Cross back around $10 was big.
This stock is currently in a strong uptrend.
In the video below, I look at the stock charts of TSTC and XIN, two more hot china stocks in strong uptrends.
The best way to play strong uptrending China stocks is to buy on Fibonacci Retracements.
There's certain days when the mainstream media falls down on the job of reporting activities in the stock market.
Today was one of those days.
China stocks continued their strong uptrend today which mostly went un-reported by mainstream media.
I wrote back in September that China stocks looked hot. I have since not been disappointed with my prophetic outlook.
Daily Chart of iShares China 25 (FXI)
I rate this chart as being in a strong uptrend.
What's most impressive is the Accum/Dist indicator that shows heavy accumulation in China stocks on pullbacks.
Notice also the breakaway gap up that took place on Wednesday, October 13, 2010. It looks very much like the gap up that occurred on September 13.
The three china stocks that I really like are LDK, TSTC, and XIN.
Daily Chart of LDK Solar (LDK)
I'm currently long in this stock. I've made a lot of money trading in and out of this stock. In fact, it's been my top money making stock pick for 2010.
The bullish Resurrection Cross back around $10 was big.
This stock is currently in a strong uptrend.
In the video below, I look at the stock charts of TSTC and XIN, two more hot china stocks in strong uptrends.
The best way to play strong uptrending China stocks is to buy on Fibonacci Retracements.
We've got a good start with Citigroup (C) lifting the Financials sector on better-than-expected results.
Citigroup said it was helped by fewer customers failing to repay loans during the third quarter, another sign that the worst losses from loan defaults could be in the past. The better results from Citi lifted shares of other banks, which had fell last week as rumor spread that most banks had improperly processed large amounts of foreclosures.
Citigroup said earnings came in at 8 cents a share, beating estimates by 2 cents a share. Quarterly revenue was $20.7 billion, slightly below the $21 billion that analysts had been expecting.
Daily Chart of Citigroup (C)
The bounce off the 50 day MA is good, but the real question is will it hold?
This chart is within an uptrend with the pivot point being the 50 day MA.
We've got a good start with Citigroup (C) lifting the Financials sector on better-than-expected results.
Citigroup said it was helped by fewer customers failing to repay loans during the third quarter, another sign that the worst losses from loan defaults could be in the past. The better results from Citi lifted shares of other banks, which had fell last week as rumor spread that most banks had improperly processed large amounts of foreclosures.
Citigroup said earnings came in at 8 cents a share, beating estimates by 2 cents a share. Quarterly revenue was $20.7 billion, slightly below the $21 billion that analysts had been expecting.
Daily Chart of Citigroup (C)
The bounce off the 50 day MA is good, but the real question is will it hold?
This chart is within an uptrend with the pivot point being the 50 day MA.
We've got a good start with Citigroup (C) lifting the Financials sector on better-than-expected results.
Citigroup said it was helped by fewer customers failing to repay loans during the third quarter, another sign that the worst losses from loan defaults could be in the past. The better results from Citi lifted shares of other banks, which had fell last week as rumor spread that most banks had improperly processed large amounts of foreclosures.
Citigroup said earnings came in at 8 cents a share, beating estimates by 2 cents a share. Quarterly revenue was $20.7 billion, slightly below the $21 billion that analysts had been expecting.
Daily Chart of Citigroup (C)
The bounce off the 50 day MA is good, but the real question is will it hold?
This chart is within an uptrend with the pivot point being the 50 day MA.
U.S. banks will be the focus next week as some big banks report earnings and investors fear that the forced halt in foreclosure proceedings could hit the financial sector hard.
Bank shares dropped sharply on Friday on high volume, continuing a drop from the previous day.
Bank of America shares hit their lowest in more than a year. The nation's largest mortgage lender, fell 9 percent during the week. Nearly 600 million shares traded on Friday, the most since April 2009.
Daily Chart Of Bank of America (BAC)
Short sellers piled into BAC over the last couple of days as bulls capitulated and went crying home to mama.
This stock is in a strong downtrend and you had plenty of warning from the Accum/Dist indicator weeks ago when it formed a negative divergence to the price.
Hedge funds are shorting BAC because they figure many banks did not follow proper due diligence when foreclosing on homes whose owners were not making mortgage payments. These cutt-throat traders figure that this will result in costly litigation, fines and additional mortgage repurchases.
The buzz on the street among even more aggressive short sellers is that this situation could expand to the housing market if this uncertainty about foreclosures prevents buyers from buying properties under foreclosure.
Banks Reporting Next Week
Banks reporting results include Wells Fargo (WFC), Bank of America (BAC), and Citigroup Inc (C), three of the largest mortgage lenders in the nation.
In the past week we saw analysts lower forward earnings estimates for Goldman Sachs (GS), PNC Financial (PNC), and Citigroup (C).
Daily Chart of Financials Sector (XLF)
Last week tested the all important $15 resistance and upper rectangle wall with a swing move down. XLF has been a swing traders dream.
With that said, the life-cycle of the sideways Rectangle channel has been exceeded. The next swing down test of the lower channel wall at $13.26 should prove interesting.
U.S. banks will be the focus next week as some big banks report earnings and investors fear that the forced halt in foreclosure proceedings could hit the financial sector hard.
Bank shares dropped sharply on Friday on high volume, continuing a drop from the previous day.
Bank of America shares hit their lowest in more than a year. The nation's largest mortgage lender, fell 9 percent during the week. Nearly 600 million shares traded on Friday, the most since April 2009.
Daily Chart Of Bank of America (BAC)
Short sellers piled into BAC over the last couple of days as bulls capitulated and went crying home to mama.
This stock is in a strong downtrend and you had plenty of warning from the Accum/Dist indicator weeks ago when it formed a negative divergence to the price.
Hedge funds are shorting BAC because they figure many banks did not follow proper due diligence when foreclosing on homes whose owners were not making mortgage payments. These cutt-throat traders figure that this will result in costly litigation, fines and additional mortgage repurchases.
The buzz on the street among even more aggressive short sellers is that this situation could expand to the housing market if this uncertainty about foreclosures prevents buyers from buying properties under foreclosure.
Banks Reporting Next Week
Banks reporting results include Wells Fargo (WFC), Bank of America (BAC), and Citigroup Inc (C), three of the largest mortgage lenders in the nation.
In the past week we saw analysts lower forward earnings estimates for Goldman Sachs (GS), PNC Financial (PNC), and Citigroup (C).
Daily Chart of Financials Sector (XLF)
Last week tested the all important $15 resistance and upper rectangle wall with a swing move down. XLF has been a swing traders dream.
With that said, the life-cycle of the sideways Rectangle channel has been exceeded. The next swing down test of the lower channel wall at $13.26 should prove interesting.
U.S. banks will be the focus next week as some big banks report earnings and investors fear that the forced halt in foreclosure proceedings could hit the financial sector hard.
Bank shares dropped sharply on Friday on high volume, continuing a drop from the previous day.
Bank of America shares hit their lowest in more than a year. The nation's largest mortgage lender, fell 9 percent during the week. Nearly 600 million shares traded on Friday, the most since April 2009.
Daily Chart Of Bank of America (BAC)
Short sellers piled into BAC over the last couple of days as bulls capitulated and went crying home to mama.
This stock is in a strong downtrend and you had plenty of warning from the Accum/Dist indicator weeks ago when it formed a negative divergence to the price.
Hedge funds are shorting BAC because they figure many banks did not follow proper due diligence when foreclosing on homes whose owners were not making mortgage payments. These cutt-throat traders figure that this will result in costly litigation, fines and additional mortgage repurchases.
The buzz on the street among even more aggressive short sellers is that this situation could expand to the housing market if this uncertainty about foreclosures prevents buyers from buying properties under foreclosure.
Banks Reporting Next Week
Banks reporting results include Wells Fargo (WFC), Bank of America (BAC), and Citigroup Inc (C), three of the largest mortgage lenders in the nation.
In the past week we saw analysts lower forward earnings estimates for Goldman Sachs (GS), PNC Financial (PNC), and Citigroup (C).
Daily Chart of Financials Sector (XLF)
Last week tested the all important $15 resistance and upper rectangle wall with a swing move down. XLF has been a swing traders dream.
With that said, the life-cycle of the sideways Rectangle channel has been exceeded. The next swing down test of the lower channel wall at $13.26 should prove interesting.
It's that time of year when analysts everywhere bring their political biases into their analysis of markets.
My favorite one this year is from David Kostin of Goldman Sachs. Check out his chart.
Kowabunga dudes! The implication is that after mid-term elections, the S&P 500 goes up, on average, 18%! Hooray for mid-term elections then, right?
That's certainly what ZeroHedge, ZSmarter, and about another dozen popular stock blogs make of it.
In fact, David Kostin goes on to write, "The mid-term election is just 32 days away (November 2nd). Historically, it has marked an inflection point with the S&P 500 recording positive gains during the 12 months after each of the 15 mid-term elections since 1950. Appreciation averaged 18.1% during the first year following the election. All elections have consequences, but the stakes seem especially high this cycle. According to RealClearPolitics.com, an independent political web site that aggregates the latest polling data, Republicans seem likely to gain control of the US House of Representatives while Democrats appear likely to retain their majority in the US Senate."
Anything released by Goldman Sachs should always be met with a skeptical eye. Remember, these are those snakes who sold people long positions in mortgage backed securities, released bullish analysis reports, but then secretly was short selling them. They were ultimately fined $550 million dollars by the SEC.
RealClearPolitics.com is just another Republican blog pretending to be fair and unbalanced. These guys have been caught red-handed doing things like publishing articles that said Israeli assembly does not attend Obama's UN address because they were boycotting him. They even showed a video of Israel's empty seats during Obama's speech. Fox Nation embedded the video from RealClearPolitics.com on their website as well. These Republican blogs had to issue humiliating updates after claiming Israel skipped Obama's UN speech. It turned out the Israeli delegation was absent due to the observation of the Jewish holiday of Sukkot. The Israeli consulate released a statement explaining that the Obama administration had been informed of the planned absence and stressed that Israeli President Shimon Peres and Israel's Defense Minister Ehud Barak were present at Obama speech on Wednesday at the Millennium Development Goals summit.
RealClearPolitics.com publishes Republican articles from the likes of Thomas Sowell who suggests that most Obama Administration voters and supporters are a blind following who never question what he does because they are in fear of being accused as racists: "The memory of that long-ago episode has come back more than once while observing both the actions of the Obama administration and the fierce reactions of its supporters to any questioning or criticism. Almost never do these reactions include factual or logical arguments against the administration's critics. Instead, there is indignation, accusations of bad faith and even charges of racism." The article is posted on their website at http://www.realclearpolitics.com/articles/2009/10/30/dismantling_america_part_ii__98936.html
I could go on and on folks with proof that RealClearPolitics is a pro-Republican blog. So the idea that David Kostin of Goldman Sachs would call them a "independent political web site" is simply not true and shows a Republican bias in David Kostin's thinking.
Next, David Kostin publishes the following chart:
You see what the subtle suggestion is? Mid-term elections are good for the S&P 500 and mid-term elections where there is a congressional change is also good. Wink, wink, you know how to vote.
Is it possible that with the new Democrat administration coming in and the SEC fining Goldman Sachs $550 million, something that never would have happened in the Bush administration, the company Goldman Sachs has moved even further towards the Republican party?
Stock Trading Masters Have The Knowledge To Destroy This Kind Of Political Bias
Let's destroy this Republican bias garbage, shall we?
The idea that mid-term elections are good for the stock market was done from a sample of 15 such mid-term election years. So we have to have the same sample size, 15. We will take the last 15 non mid-term election years and calculate the average the S&P 500 has gained from November to November of the following year. We'll start from 2007, just like David did, and we'll go backwards from there.
So the average is 11%, 12 months after non-election years, the exact same number David Kostin of Goldman Sachs got for election years. In otherwords folks, mid-term elections don't have any effect on the S&P 500 whatsoever.
But the market does go up. So doesn't it have to?
No. September and October are the two historically weakest months of the year for the S&P 500. November and December are usually strong months due to the seasonal "Santa Claus Rally".
In otherwords, regular yearly seasonality explains why David Kostin's chart looks the way it does and NOT mid-term elections.
No other stock market blogger on the Internet picked up on this. They all just re-posted David Kostin's charts on their blogs as if it was fact.
This doesn't mean that David Kostin is a lying jerk and everything he says is bogus. His report has a lot of good information in it. Your challenge is to separate the good information from the bad. Here is David's full report.
It's that time of year when analysts everywhere bring their political biases into their analysis of markets.
My favorite one this year is from David Kostin of Goldman Sachs. Check out his chart.
Kowabunga dudes! The implication is that after mid-term elections, the S&P 500 goes up, on average, 18%! Hooray for mid-term elections then, right?
That's certainly what ZeroHedge, ZSmarter, and about another dozen popular stock blogs make of it.
In fact, David Kostin goes on to write, "The mid-term election is just 32 days away (November 2nd). Historically, it has marked an inflection point with the S&P 500 recording positive gains during the 12 months after each of the 15 mid-term elections since 1950. Appreciation averaged 18.1% during the first year following the election. All elections have consequences, but the stakes seem especially high this cycle. According to RealClearPolitics.com, an independent political web site that aggregates the latest polling data, Republicans seem likely to gain control of the US House of Representatives while Democrats appear likely to retain their majority in the US Senate."
Anything released by Goldman Sachs should always be met with a skeptical eye. Remember, these are those snakes who sold people long positions in mortgage backed securities, released bullish analysis reports, but then secretly was short selling them. They were ultimately fined $550 million dollars by the SEC.
RealClearPolitics.com is just another Republican blog pretending to be fair and unbalanced. These guys have been caught red-handed doing things like publishing articles that said Israeli assembly does not attend Obama's UN address because they were boycotting him. They even showed a video of Israel's empty seats during Obama's speech. Fox Nation embedded the video from RealClearPolitics.com on their website as well. These Republican blogs had to issue humiliating updates after claiming Israel skipped Obama's UN speech. It turned out the Israeli delegation was absent due to the observation of the Jewish holiday of Sukkot. The Israeli consulate released a statement explaining that the Obama administration had been informed of the planned absence and stressed that Israeli President Shimon Peres and Israel's Defense Minister Ehud Barak were present at Obama speech on Wednesday at the Millennium Development Goals summit.
Further, John Leo at Real Clear Politics, said that Democrats are generally unpatriotic Islamic extremism appeasers. They spammed this email out across the Internet. The article is still posted on their website today at http://www.realclearpolitics.com/articles/2006/06/liberals_need_new_narrative_th.html
RealClearPolitics.com publishes Republican articles from the likes of Thomas Sowell who suggests that most Obama Administration voters and supporters are a blind following who never question what he does because they are in fear of being accused as racists: "The memory of that long-ago episode has come back more than once while observing both the actions of the Obama administration and the fierce reactions of its supporters to any questioning or criticism. Almost never do these reactions include factual or logical arguments against the administration's critics. Instead, there is indignation, accusations of bad faith and even charges of racism." The article is posted on their website at http://www.realclearpolitics.com/articles/2009/10/30/dismantling_america_part_ii__98936.html
I could go on and on folks with proof that RealClearPolitics is a pro-Republican blog. So the idea that David Kostin of Goldman Sachs would call them a "independent political web site" is simply not true and shows a Republican bias in David Kostin's thinking.
Next, David Kostin publishes the following chart:
You see what the subtle suggestion is? Mid-term elections are good for the S&P 500 and mid-term elections where there is a congressional change is also good. Wink, wink, you know how to vote.
Is it possible that with the new Democrat administration coming in and the SEC fining Goldman Sachs $550 million, something that never would have happened in the Bush administration, the company Goldman Sachs has moved even further towards the Republican party?
Stock Trading Masters Have The Knowledge To Destroy This Kind Of Political Bias
Let's destroy this Republican bias garbage, shall we?
The idea that mid-term elections are good for the stock market was done from a sample of 15 such mid-term election years. So we have to have the same sample size, 15. We will take the last 15 non mid-term election years and calculate the average the S&P 500 has gained from November to November of the following year. We'll start from 2007, just like David did, and we'll go backwards from there.
So the average is 11%, 12 months after non-election years, the exact same number David Kostin of Goldman Sachs got for election years. In otherwords folks, mid-term elections don't have any effect on the S&P 500 whatsoever.
But the market does go up. So doesn't it have to?
No. September and October are the two historically weakest months of the year for the S&P 500. November and December are usually strong months due to the seasonal "Santa Claus Rally".
In otherwords, regular yearly seasonality explains why David Kostin's chart looks the way it does and NOT mid-term elections.
No other stock market blogger on the Internet picked up on this. They all just re-posted David Kostin's charts on their blogs as if it was fact.
This doesn't mean that David Kostin is a lying jerk and everything he says is bogus. His report has a lot of good information in it. Your challenge is to separate the good information from the bad. Here is David's full report.
Weekly Charts Kostin 10.1
It's that time of year when analysts everywhere bring their political biases into their analysis of markets.
My favorite one this year is from David Kostin of Goldman Sachs. Check out his chart.
Kowabunga dudes! The implication is that after mid-term elections, the S&P 500 goes up, on average, 18%! Hooray for mid-term elections then, right?
That's certainly what ZeroHedge, ZSmarter, and about another dozen popular stock blogs make of it.
In fact, David Kostin goes on to write, "The mid-term election is just 32 days away (November 2nd). Historically, it has marked an inflection point with the S&P 500 recording positive gains during the 12 months after each of the 15 mid-term elections since 1950. Appreciation averaged 18.1% during the first year following the election. All elections have consequences, but the stakes seem especially high this cycle. According to RealClearPolitics.com, an independent political web site that aggregates the latest polling data, Republicans seem likely to gain control of the US House of Representatives while Democrats appear likely to retain their majority in the US Senate."
Anything released by Goldman Sachs should always be met with a skeptical eye. Remember, these are those snakes who sold people long positions in mortgage backed securities, released bullish analysis reports, but then secretly was short selling them. They were ultimately fined $550 million dollars by the SEC.
RealClearPolitics.com is just another Republican blog pretending to be fair and unbalanced. These guys have been caught red-handed doing things like publishing articles that said Israeli assembly does not attend Obama's UN address because they were boycotting him. They even showed a video of Israel's empty seats during Obama's speech. Fox Nation embedded the video from RealClearPolitics.com on their website as well. These Republican blogs had to issue humiliating updates after claiming Israel skipped Obama's UN speech. It turned out the Israeli delegation was absent due to the observation of the Jewish holiday of Sukkot. The Israeli consulate released a statement explaining that the Obama administration had been informed of the planned absence and stressed that Israeli President Shimon Peres and Israel's Defense Minister Ehud Barak were present at Obama speech on Wednesday at the Millennium Development Goals summit.
Further, John Leo at Real Clear Politics, said that Democrats are generally unpatriotic Islamic extremism appeasers. They spammed this email out across the Internet. The article is still posted on their website today at http://www.realclearpolitics.com/articles/2006/06/liberals_need_new_narrative_th.html
RealClearPolitics.com publishes Republican articles from the likes of Thomas Sowell who suggests that most Obama Administration voters and supporters are a blind following who never question what he does because they are in fear of being accused as racists: "The memory of that long-ago episode has come back more than once while observing both the actions of the Obama administration and the fierce reactions of its supporters to any questioning or criticism. Almost never do these reactions include factual or logical arguments against the administration's critics. Instead, there is indignation, accusations of bad faith and even charges of racism." The article is posted on their website at http://www.realclearpolitics.com/articles/2009/10/30/dismantling_america_part_ii__98936.html
I could go on and on folks with proof that RealClearPolitics is a pro-Republican blog. So the idea that David Kostin of Goldman Sachs would call them a "independent political web site" is simply not true and shows a Republican bias in David Kostin's thinking.
Next, David Kostin publishes the following chart:
You see what the subtle suggestion is? Mid-term elections are good for the S&P 500 and mid-term elections where there is a congressional change is also good. Wink, wink, you know how to vote.
Is it possible that with the new Democrat administration coming in and the SEC fining Goldman Sachs $550 million, something that never would have happened in the Bush administration, the company Goldman Sachs has moved even further towards the Republican party?
Stock Trading Masters Have The Knowledge To Destroy This Kind Of Political Bias
Let's destroy this Republican bias garbage, shall we?
The idea that mid-term elections are good for the stock market was done from a sample of 15 such mid-term election years. So we have to have the same sample size, 15. We will take the last 15 non mid-term election years and calculate the average the S&P 500 has gained from November to November of the following year. We'll start from 2007, just like David did, and we'll go backwards from there.
So the average is 11%, 12 months after non-election years, the exact same number David Kostin of Goldman Sachs got for election years. In otherwords folks, mid-term elections don't have any effect on the S&P 500 whatsoever.
But the market does go up. So doesn't it have to?
No. September and October are the two historically weakest months of the year for the S&P 500. November and December are usually strong months due to the seasonal "Santa Claus Rally".
In otherwords, regular yearly seasonality explains why David Kostin's chart looks the way it does and NOT mid-term elections.
No other stock market blogger on the Internet picked up on this. They all just re-posted David Kostin's charts on their blogs as if it was fact.
This doesn't mean that David Kostin is a lying jerk and everything he says is bogus. His report has a lot of good information in it. Your challenge is to separate the good information from the bad. Here is David's full report.
Weekly Charts Kostin 10.1
Wells Fargo analyst Michael Webber pumped shares of dry bulk shipping firms Dryships (DRYS) and Eagle Bulk Shipping (EGLE). Michael Webber "initiated coverage" of the two with “Market Perform” on DRYS and a “Outperform” rating on EGLE.
Michael says DRYS is worth between $5 and $6, while Eagle is worth $6 to $7. Currently DRYS trades at $4.12 while EGLE trades at $5.10.
Daily Charts of DRYS and EGLE
Clearly EGLE is the stronger chart with an Ascending Triangle pattern while DRYS is almost its mirror opposite with a Descending Triangle. Also, notice the three huge sell side volume spikes over the last week on DRYS.
Why do traders favor EGLE over DRYS? Eagle made the decision to expand its fleet of "Supramax" ships. These giant ships can carry more cargo. Eagle’s fleet of “Supramax” ships, of which it has one of the largest collections in the world at 36 ships out of a total fleet of 39, will add another 8 ships through next year.
Meanwhile, Dryships made the decision to expand into a drilling ship contractor for oil and gas companies. None of its four drillship newbuilds are currently chartered and DRYS has yet to secure financing for two of the four drillships, which creates substantial near-term risks. That could force Dryships to have to consolidate its orders or to have to sell some ships at or near a loss given depreciation of the rigs. Also, Michael believes the “ultra deep water” drilling market is seeing weak rates that will barely let the company break even.
Global Shipping Trends ETF (SEA) Chart
This index is designed to measure the performance of companies listed on global developed market exchanges within the maritime shipping industry.
The chart shows bulk shippers are in an uptrend channel since June of 2010. Notice the higher highs and higher lows that are in place.
So in summary, if you're interested in taking an early position in dry bulk shippers in anticipation for a continuation of the global recovery currently underway, EGLE is a better long than DRYS for both technical and fundamental reasons.
Disclosure: I don't hold any position in any of the stocks mentioned.
Wells Fargo analyst Michael Webber pumped shares of dry bulk shipping firms Dryships (DRYS) and Eagle Bulk Shipping (EGLE). Michael Webber "initiated coverage" of the two with “Market Perform” on DRYS and a “Outperform” rating on EGLE.
Michael says DRYS is worth between $5 and $6, while Eagle is worth $6 to $7. Currently DRYS trades at $4.12 while EGLE trades at $5.10.
Daily Charts of DRYS and EGLE
Clearly EGLE is the stronger chart with an Ascending Triangle pattern while DRYS is almost its mirror opposite with a Descending Triangle. Also, notice the three huge sell side volume spikes over the last week on DRYS.
Why do traders favor EGLE over DRYS? Eagle made the decision to expand its fleet of "Supramax" ships. These giant ships can carry more cargo. Eagle’s fleet of “Supramax” ships, of which it has one of the largest collections in the world at 36 ships out of a total fleet of 39, will add another 8 ships through next year.
Meanwhile, Dryships made the decision to expand into a drilling ship contractor for oil and gas companies. None of its four drillship newbuilds are currently chartered and DRYS has yet to secure financing for two of the four drillships, which creates substantial near-term risks. That could force Dryships to have to consolidate its orders or to have to sell some ships at or near a loss given depreciation of the rigs. Also, Michael believes the “ultra deep water” drilling market is seeing weak rates that will barely let the company break even.
Global Shipping Trends ETF (SEA) Chart
This index is designed to measure the performance of companies listed on global developed market exchanges within the maritime shipping industry.
The chart shows bulk shippers are in an uptrend channel since June of 2010. Notice the higher highs and higher lows that are in place.
So in summary, if you're interested in taking an early position in dry bulk shippers in anticipation for a continuation of the global recovery currently underway, EGLE is a better long than DRYS for both technical and fundamental reasons.
Disclosure: I don't hold any position in any of the stocks mentioned.
Wells Fargo analyst Michael Webber pumped shares of dry bulk shipping firms Dryships (DRYS) and Eagle Bulk Shipping (EGLE). Michael Webber "initiated coverage" of the two with “Market Perform” on DRYS and a “Outperform” rating on EGLE.
Michael says DRYS is worth between $5 and $6, while Eagle is worth $6 to $7. Currently DRYS trades at $4.12 while EGLE trades at $5.10.
Daily Charts of DRYS and EGLE
Clearly EGLE is the stronger chart with an Ascending Triangle pattern while DRYS is almost its mirror opposite with a Descending Triangle. Also, notice the three huge sell side volume spikes over the last week on DRYS.
Why do traders favor EGLE over DRYS? Eagle made the decision to expand its fleet of "Supramax" ships. These giant ships can carry more cargo. Eagle’s fleet of “Supramax” ships, of which it has one of the largest collections in the world at 36 ships out of a total fleet of 39, will add another 8 ships through next year.
Meanwhile, Dryships made the decision to expand into a drilling ship contractor for oil and gas companies. None of its four drillship newbuilds are currently chartered and DRYS has yet to secure financing for two of the four drillships, which creates substantial near-term risks. That could force Dryships to have to consolidate its orders or to have to sell some ships at or near a loss given depreciation of the rigs. Also, Michael believes the “ultra deep water” drilling market is seeing weak rates that will barely let the company break even.
Global Shipping Trends ETF (SEA) Chart
This index is designed to measure the performance of companies listed on global developed market exchanges within the maritime shipping industry.
The chart shows bulk shippers are in an uptrend channel since June of 2010. Notice the higher highs and higher lows that are in place.
So in summary, if you're interested in taking an early position in dry bulk shippers in anticipation for a continuation of the global recovery currently underway, EGLE is a better long than DRYS for both technical and fundamental reasons.
Disclosure: I don't hold any position in any of the stocks mentioned.
Gold mine cash costs continue to rise. If you are long gold, you need to set a trailing stop loss so that when this market reverses, you'll have guaranteed profits locked in.
The average gold production cost was $558 per ounce in the second quarter of 2010. At the same time, the gold price (London pm fix) averaged $1,194 per ounce. That results in an average margin of $636 on every ounce mined.
How does that compare to previous quarters? The average cash cost was $544 in Q1, which itself was way up from $453 an ounce in Q1 2009.
The profit margin on each ounce of gold is widening because gold prices are rising faster than costs. The $636 margin in Q2 was up from $561 per ounce in Q1 and $451 per ounce in Q2 2009. Rising mining costs are one of the upward pressures on the price of gold.
So these increased costs are mostly hidden from investors because the price of gold has been rising. In order for gold miners to maintain current profit margins and growth, gold will need to continue to rise faster than the rising cost to get it out of the ground. What this means is that when this market does reverse, it may do so violently downward.
Now costs seem to be rising faster for low-cost producers. That may be because they are exhausting current deposits of high-grade ore, so they move on to lower-grade, higher-cost ore.
Latin America remains the lowest cost region for gold mining.
Gold mine cash costs continue to rise. If you are long gold, you need to set a trailing stop loss so that when this market reverses, you'll have guaranteed profits locked in.
The average gold production cost was $558 per ounce in the second quarter of 2010. At the same time, the gold price (London pm fix) averaged $1,194 per ounce. That results in an average margin of $636 on every ounce mined.
How does that compare to previous quarters? The average cash cost was $544 in Q1, which itself was way up from $453 an ounce in Q1 2009.
The profit margin on each ounce of gold is widening because gold prices are rising faster than costs. The $636 margin in Q2 was up from $561 per ounce in Q1 and $451 per ounce in Q2 2009. Rising mining costs are one of the upward pressures on the price of gold.
So these increased costs are mostly hidden from investors because the price of gold has been rising. In order for gold miners to maintain current profit margins and growth, gold will need to continue to rise faster than the rising cost to get it out of the ground. What this means is that when this market does reverse, it may do so violently downward.
Now costs seem to be rising faster for low-cost producers. That may be because they are exhausting current deposits of high-grade ore, so they move on to lower-grade, higher-cost ore.
Latin America remains the lowest cost region for gold mining.
Gold mine cash costs continue to rise. If you are long gold, you need to set a trailing stop loss so that when this market reverses, you'll have guaranteed profits locked in.
The average gold production cost was $558 per ounce in the second quarter of 2010. At the same time, the gold price (London pm fix) averaged $1,194 per ounce. That results in an average margin of $636 on every ounce mined.
How does that compare to previous quarters? The average cash cost was $544 in Q1, which itself was way up from $453 an ounce in Q1 2009.
The profit margin on each ounce of gold is widening because gold prices are rising faster than costs. The $636 margin in Q2 was up from $561 per ounce in Q1 and $451 per ounce in Q2 2009. Rising mining costs are one of the upward pressures on the price of gold.
So these increased costs are mostly hidden from investors because the price of gold has been rising. In order for gold miners to maintain current profit margins and growth, gold will need to continue to rise faster than the rising cost to get it out of the ground. What this means is that when this market does reverse, it may do so violently downward.
Now costs seem to be rising faster for low-cost producers. That may be because they are exhausting current deposits of high-grade ore, so they move on to lower-grade, higher-cost ore.
Latin America remains the lowest cost region for gold mining.
Retail sales for August had the biggest jump in five months. The Commerce Department reported that purchases were up 0.4 percent from July to August. Economists had expected a rise of 0.3 percent.
The surprise retail numbers spurred buying in Liz Claiborne (LIZ) and Pacific Sunwear (PSUN).
Notice that LIZ hit a high of $5.03 on the news, briefly crossing above the tough $5 resistance but was quickly met with profit talking. This is a great example of why you should never chase a stock. The swing move up began last Friday off $4.40. The stock is already up 13% going into today's retail numbers announcement.
The market makers are screwing around with PSUN setting a gap open at $4.89 only to have professional traders fade the gap and send the price falling back down to $4.30
PSUN, like LIZ, had wicked headfakes on this morning's retail sales, better than expected, news. Anyone buying into these retail stocks this morning was killed.
It's a dangerous world out there today folks, be cautious and don't chase.
The idea is to buy on rumor and sell on news. The slightly better than expected retail sales numbers were already priced into the market.
Retail sales for August had the biggest jump in five months. The Commerce Department reported that purchases were up 0.4 percent from July to August. Economists had expected a rise of 0.3 percent.
The surprise retail numbers spurred buying in Liz Claiborne (LIZ) and Pacific Sunwear (PSUN).
Notice that LIZ hit a high of $5.03 on the news, briefly crossing above the tough $5 resistance but was quickly met with profit talking. This is a great example of why you should never chase a stock. The swing move up began last Friday off $4.40. The stock is already up 13% going into today's retail numbers announcement.
The market makers are screwing around with PSUN setting a gap open at $4.89 only to have professional traders fade the gap and send the price falling back down to $4.30
PSUN, like LIZ, had wicked headfakes on this morning's retail sales, better than expected, news. Anyone buying into these retail stocks this morning was killed.
It's a dangerous world out there today folks, be cautious and don't chase.
The idea is to buy on rumor and sell on news. The slightly better than expected retail sales numbers were already priced into the market.
Retail sales for August had the biggest jump in five months. The Commerce Department reported that purchases were up 0.4 percent from July to August. Economists had expected a rise of 0.3 percent.
The surprise retail numbers spurred buying in Liz Claiborne (LIZ) and Pacific Sunwear (PSUN).
Notice that LIZ hit a high of $5.03 on the news, briefly crossing above the tough $5 resistance but was quickly met with profit talking. This is a great example of why you should never chase a stock. The swing move up began last Friday off $4.40. The stock is already up 13% going into today's retail numbers announcement.
The market makers are screwing around with PSUN setting a gap open at $4.89 only to have professional traders fade the gap and send the price falling back down to $4.30
PSUN, like LIZ, had wicked headfakes on this morning's retail sales, better than expected, news. Anyone buying into these retail stocks this morning was killed.
It's a dangerous world out there today folks, be cautious and don't chase.
The idea is to buy on rumor and sell on news. The slightly better than expected retail sales numbers were already priced into the market.
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With 3 bullish indicators out of 5, there is a 60% probability that the strong uptrend will continue.
The bounce off the 50 day MA is good, but the real question is will it hold? 
Short sellers piled into BAC over the last couple of days as bulls capitulated and went crying home to mama.
Last week tested the all important $15 resistance and upper rectangle wall with a swing move down. XLF has been a swing traders dream.
At the same time, the gold price (London pm fix) averaged $1,194 per ounce. That results in an average margin of $636 on every ounce mined.
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