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Gold: An Inverse Trade With Equities

Gold: An Inverse Trade With Equities

Precious metals rallied sharply late last week and through Monday’s session in the face of significant equity losses. While plunging equity markets offer a “risk off” mood that drove investors into the precious metals sector most notably into Gold and silver, that same reaction could reverse itself if Janet Yellen’s testimony in front of Congress is seen as dovish. However should Yellen’s...

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Surge in VIX Spills into Commodities: A Gift for Gold Option Sellers?

Surge in VIX Spills into Commodities: A Gift for Gold Option Sellers?

Back at the beginning of December, the we advised selling gold calls with the rational that gold prices would have a hard time moving substantially higher in light of a Fed Rate hike (amongst other reasons.) *If you missed this piece, it remains relevant and you can read it on the blog at www.OptionSellers.com/golddec We still feel that gold calls can offer investors some attractive premium...

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SPX: Beware the War of 1812

SPX: Beware the War of 1812

The S&P 500 cash index ($SPX) closed at 1880.05 last Friday, down 26.85 points for net weekly loss of 1.40%. Friday was especially brutal, one big red candle than carried the price right back down to the recent support around 1875, extinguishing all the gains made a week earlier, and reminding traders that there is a very big and very empty void below the current price. The number to...

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The Nasdaq 100 Playbook

The Nasdaq 100 Playbook

The Nasdaq 100 is an index comprised of the 100 largest Nasdaq stocks by market cap. This cap-weighted index is a well-watched benchmark because it is the Nasdaq’s version of the S&P 500.  I recently discussed the technical criteria for calling a bear market in the S&P 500, which differs from the Nasdaq 100 due to differences in volatility. If the S&P 500 (SPY) closes below the...

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Stock Market Distribution Continues

Stock Market Distribution Continues

We started a new month this past week, but it was like Deja Vu all over again.  The Groundhog declared an early spring on Tuesday, a change in weather.  But regarding markets, you could have fooled me.  It was the same action we have seen for weeks on end, and it doesn't seem to be letting up.  The vicious selling last week was magnified on Friday after a jobs report that seemed indicate the...

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Trading Tactics: Dealing With A Trading Slump Part 2

Trading Tactics: Dealing With A Trading Slump Part 2

If you are actively trading/investing in markets you understand there is a great deal of volatility to contend with.  Certainly the emotions run rampant as we try best to find the right names at the right time for our portfolio.  Sometimes we get lucky and pick up stuff at good prices, but other times we are not so fortunate.  For traders, this can be repetitive, and nothing hurts more than...

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ETF Watch: Biotech On The Bid (IBB)

ETF Watch: Biotech On The Bid (IBB)

About 3 weeks ago I wrote an article for Trader Planet entitled: Bye Bye Biotech, with an immediate target for the main Biotech ETF (IBB) of $250 and a 12-18 month target of $175 and then $150. This week IBB hit my first target (the low was $251) and has paused at its Volume Profile Point of Control (VPPOC) at $260. Interestingly the Nasdaq itself is also at its VPPOC (750 day lookback)....

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Bank of America (BAC): Buy It Cheaper Than Charlie Munger

Bank of America (BAC): Buy It Cheaper Than Charlie Munger

Last week, I spoke about Warren Buffett’s and Charlie Munger’s favourite and biggest stock holding Wells Fargo at Trader Planet. I have identified another opportunity I’ve been loading up on as of late, Bank of America (BAC). Interestingly, it is also Charlie Munger’s second largest holding after Wells Fargo. He holds almost 30% of his portfolio in BAC. Along with all banking stocks, Bank of...

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Dow Jones Index Should Trend Downward Through The Year

Dow Jones Index Should Trend Downward Through The Year

With the Dow Jones Industrial Average showing signs of breakdown, our primary chart scenario suggests that traders should look for downward-trending moves throughout most of 2016. However, we also expect the market to present several opportunities for traders to make missteps. This post offers a big-picture roadmap and identifies some likely targets for the first part of the expected...

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Thin Fundamentals for Corn

Thin Fundamentals for Corn

Bearish side fundamentals are getting thin now.  These include the Ukraine and Argentina holding large inventories of corn at values under U.S. posted prices and private forecasters are starting to come out with their projections for this year’s planted acres.  One forecaster last week projected 89.2 million acres to be planted versus 88.0 last year. However bullish side fundamentals are...

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Is "Smart Beta" A Good Strategy For You?

Is "Smart Beta" A Good Strategy For You?

Will Value Investing Become The Norm? In a January 30, 2016 interview, Rob Arnott, Chairman and CEO of Research Affiliates, questioned the value of many new Smart Beta strategies, supported staying the course with value investing, and predicted that oil prices will continue to fall. Arnott said there is “Nothing smart about Smart Beta if you adopt strategies that are overpriced.”  He...

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Tesla: Starting a Bounce

Tesla: Starting a Bounce

Has Tesla lost its mojo? Even though I’m a long-term Tesla bull, I’m afraid TSLA is headed much lower.  That said, I’m also a short-term trader and in the near-term I see a bounce underway, so I’m long TSLA common. Tesla reports earnings on February 10th. Key share price drivers include updates on the pace of the Model X ramp up, updates on Gigafactory and the battery storage business, and...

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The Market Gets a Break

The Market Gets a Break

On Friday morning I pointed out “a curiously bullish configuration in the Nasdaq futures.”  I added, however, that “the real market leadership at this time is coming from the Dow.” Friday was indeed a good day for the Dow, up almost 400 points. After strong up days, the market usually consolidates its gains. Most traders are quite skeptical of this market and don’t expect much of a rally....

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Trade Alert: Natural Gas Poised For Big Move

Trade Alert: Natural Gas Poised For Big Move

Front month natural gas futures traded all the way down to $1.802 in mid-December. Obviously, the energy sector has taken a pummeling over this past year and the market’s recent rally has sparked some new interest. However, based on the outline and chart below, we believe this is a short selling opportunity rather than the early legs of a new bull market. First of all, some things to...

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Stock Market Cycles: Eighth Year Returns

Stock Market Cycles: Eighth Year Returns

Eighth Year Returns As explained in last week’s article, my Hybrid Lindsay model is pointing to a high in the Dow today, February 1st. Whether it is today, tomorrow, last Friday, or some other day very close to today, I have every reason to believe equities will begin a decline now that will likely continue for the remainder of the month. And it is more than just the Lindsay model that has...

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