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ben_dover0802
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Re: Stock Update for March 21, 2011 - S&P, VZ, CSX [Re: The Ecstatic]
#14172171 - 03/23/11 07:28 PM (12 years, 10 months ago) |
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Quote:
The Ecstatic said: Also, I have a friend who sticks to a certain asset allocation and swears on it.
This is it:
25% S&P Index Fund 25% Long Term Treasury Bonds 25% Gold 25% Cash
He re-balances every couple months.
Opinions on this? He's got a nice steady return average over the last 25 years or so.
Yeah that looks pretty boring - but not dumb - I bet he made a nice chunk of change doing that for 25 years. I am with Geo - I am out for some $$$ minus the quarter century of waiting
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The Ecstatic
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Re: Stock Update for March 21, 2011 - S&P, VZ, CSX [Re: ben_dover0802]
#14174890 - 03/24/11 09:52 AM (12 years, 10 months ago) |
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Ford up 5% right now, let's hope this trend continues.
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The Ecstatic
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Re: Stock Update for March 21, 2011 - S&P, VZ, CSX [Re: The Ecstatic]
#14181814 - 03/25/11 12:18 PM (12 years, 10 months ago) |
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Liz Taylor is more lively than this thread.
I was expecting a slight correction in F today, but it's continuing it's slow crawl upward. Silver continues to piss me off with it's volatility, I guess I should thank the crooked bastards at JP Morgan for that.
Opinions on QE3? It seems like a certainty at this point, the market will crash if we stopped now.
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iluvfungi



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Re: Stock Update for March 21, 2011 - S&P, VZ, CSX [Re: The Ecstatic]
#14213827 - 03/31/11 08:53 AM (12 years, 9 months ago) |
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Or how about GRDO buy very soon and have 100% return in 2 days?
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geokills
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Re: Stock Update for March 21, 2011 - S&P, VZ, CSX [Re: iluvfungi]
#14217752 - 03/31/11 10:25 PM (12 years, 9 months ago) |
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Learn something about liquidity please. Penny stocks are not worth any investor's time save for perhaps thrills as a lottery ticket. No thanks.
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ben_dover0802
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Re: Stock Update for March 21, 2011 - S&P, VZ, CSX [Re: geokills]
#14217823 - 03/31/11 10:37 PM (12 years, 9 months ago) |
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So, I don't own anything in the energy field yet. One company I was looking at is CHK, a natural gas producer. I am not a very good chart analyst yet, I know what most things mean, but not necessarily what to look for. BUT, just using logic (I have been doing okay with this so far) I expect natural gas to increase in value as overall energy does.
If you have better things to do I completely understand Geo, but is there anything that sticks out to you why this wouldn't be a good choice?
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geokills
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Re: Stock Update for March 21, 2011 - S&P, VZ, CSX [Re: ben_dover0802]
#14227856 - 04/02/11 07:23 PM (12 years, 9 months ago) |
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CHK is a company with excellent management, good assets and is also a take over target. I think it's a good choice for an energy investment focusing on natural gas assets. 
I've actually had this on my screen for some time, but haven't taken a bite, yet.
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The Ecstatic
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Re: Stock Update for March 21, 2011 - S&P, VZ, CSX [Re: geokills]
#14235976 - 04/04/11 12:37 PM (12 years, 9 months ago) |
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opinions on Cisco? It had a rough first quarter but I'm expecting a bounce back, they're the king of the hill when it comes to networking devices, I'm definitely keeping my eye on it.
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geokills
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Stock Update for April 4, 2011 - General Remarks [Re: The Ecstatic]
#14236438 - 04/04/11 02:23 PM (12 years, 9 months ago) |
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Not a fan of CSCO. Technically, the stock is in a pronounced downtrend on both the weekly and the daily charts. Therefore, you should wait for a clear indication of support before putting your money in this name. I would not be surprised to see this stock test its 2008 lows at around $14 (some 18% lower than today's close). On a fundamental basis, the company is a little too big for me and is being weighed down by bad management. By "too big", I simply mean that I gravitate toward investing in emerging companies with room to expand as opposed to mature companies that, while they may dominate their industry and produce a lot of cash flow, are already too big to produce the percentage based year-over-year growth that ultimately causes stock price appreciation. The recent addition of a dividend is a positive development for Cisco, but at less than 2% annually, not a compelling enough reason for me to hold the stock.
Frankly, I would rather own Riverbed (RVBD) in the networking communications sector, which is growing much faster and accordingly carries an astronomical price to earnings ratio (make no mistake, RVBD is an expensive stock). RVBD will be more volatile than CSCO no question about it, so if you aren't an active trader or can't handle the swings, CSCO is likely to be a more peaceful stock to own. Although for my part, in this instance I equate being peaceful to being boring and unproductive. 
To note, money has been flowing out of the semiconductor sector and into commodities. The market is also testing its February highs (i.e. it's at resistance). Therefore, I am not much of a buyer right now, just a wait and see-er. Both technology and financial stocks are having a difficult time, which does not bode well for the aggregate market landscape. I'd like to see the market consolidate here at around 1300 on the S&P for a while longer before starting to grind higher. The velocity with which the major averages came off of last month's lows is not usually a sign of sustainable longer term strength. Then again, with currency devalued every day, housing still struggling and no decent returns on cash, stocks are pretty much the only game in town for growth oriented asset allocation.
Ben Bernanke (chairman of the Federal Reserve) will be holding a conference later this month that will probably be a fairly significant market event, as it could provide direction as to the future of the quantitative easing program as well as interest rates. I cannot predict what may be said or even how the market may receive whatever is said, so I wouldn't expect myself to do a lot of trading between now and then.
Positions (from largest to smallest):
53% Cash 36% Long Stock: KMP, PSEC, SOA, NLY, AGNC, CPNO, DE 3% Long Call Options: PBR Apr $35, PBR Jul $39, SWKS Aug $30 8% Long Unsecured Debt via LendingClub.com @ ~12.4% APY
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The Ecstatic
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Re: Stock Update for April 4, 2011 - General Remarks [Re: geokills]
#14236738 - 04/04/11 03:09 PM (12 years, 9 months ago) |
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All good points from you as always, Geo.
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iluvfungi



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Re: Stock Update for March 21, 2011 - S&P, VZ, CSX [Re: geokills]
#14240439 - 04/05/11 06:36 AM (12 years, 9 months ago) |
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Quote:
geokills said: Learn something about liquidity please. Penny stocks are not worth any investor's time save for perhaps thrills as a lottery ticket. No thanks.
Yah and I was absolutely right with this prediction. It was only 70%, but it was spot on. Your just a stupid idiot. Penny stocks have the best returns if you know your shit. But you aren't real trader, just some pretender, wannabe.
Look up the post, I didn't edit it. Look at the GRDO stock. Proof you coward. I'm psychic.
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geokills
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Re: Stock Update for March 21, 2011 - S&P, VZ, CSX [Re: iluvfungi]
#14241095 - 04/05/11 10:36 AM (12 years, 9 months ago) |
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- A 70% return would have required bottom ticking on the ideal buy and top ticking on the ideal sell points, given the time of your post. With each individual trade on GRDO tending to transact only $100 - $1000 worth of stock, and any trades over $1000 causing significant price movement (greater than 10%), I'd really rather appreciate it if you kept your penny stock comments to your own penny stock thread. If you're trading with a $500 account or just want to gamble, penny stock strategies can work to limited extent. But as soon as your account grows in value, you'll realize why using penny stocks to grow your capital over the long term is almost always a losing strategy. You said it yourself in this post: "I literally have $1,000 dollars in trade now, soon I'll have $2,000. I'm getting more money soon so I'll have $5,000 or so total in trading ... I've traded with excess of $20,000 in the market. I've made tens of thousands of dollars, I've lost tens of thousands of dollars as well..."
Put plainly, if you ever give back more than 10% of your portfolio value in a given year, you are not effectively managing your money. The number one key to being a successful investor is not LOSING your dough, otherwise you're just wasting time trying to get back to even. Only once you have learned to limit losses, can you focus on consistently growing your capital.
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geokills
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Stock Update for April 5, 2011 - CHK [Re: ben_dover0802]
#14241109 - 04/05/11 10:39 AM (12 years, 9 months ago) |
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To take another look at ben_dover's question pertaining to CHK and technical analysis:
Quote:
ben_dover0802 said: So, I don't own anything in the energy field yet. One company I was looking at is CHK, a natural gas producer. I am not a very good chart analyst yet, I know what most things mean, but not necessarily what to look for.
As this stock continues to grind sideways, I am getting more interested in taking a position. In fact, I purchased a very small lot of the May $34 Call Options today, in anticipation of a volatility expansion off of the 50 day moving average. Take a look at the chart:

You will see that the bollinger bands (blue lines) have been steadily contracting as the price action has contained itself more or less between $33 - $34.60. Bollinger bands are a measure of volatility, which is cyclical (goes in cycles of low volatility giving way to high volatility). Generally, you can expect a large movement one way or the other, after volatility on a given issue has remained tight for a prolonged period of time.
Notice on the chart that I have set price alerts to inform me when CHK is close to breaching either the bottom (support) or the top (resistance) of the volatility squeeze channel that has developed. This will key me in on the direction of the stock as volatility begins to expand. Because the 50 day moving average is near by and continuing to move higher, the stock has a bias to expand to the upside. Therefore my current trading plan on this issue is to sit on my small call option position until one of my alerts is hit. If the stock tests support near its 50 day moving average ($32.30 - $33), I will watch for signs of strength to add to my long position at the bottom of the channel for a better price, while keeping a SELL STOP order just below the 50 day moving average, so that if the stock breaks down, the position will automatically close out for a small loss, since movement below the 50 day would indicate a volatility expansion to the downside.
On the other hand, whether or not I get to pick up more shares at the bottom of the current channel, I have another alert set at the top ($34.60), and if that alert triggers and I see the bollinger bands expanding with the stock breaking through the top band on good volume, I will pay up to add to my existing position on the breakout, with the expectation that volatility will continue to expand to the upside. In this instance, I would keep a SELL STOP on at least 50% of my position just below the breakout level ($34.60).
To give you an idea of the power of a volatility expansion, take a look at LULU:

I actually went in heavy on calls on the morning of March 28th when the stock started to break out of its volatility squeeze on heavy volume. Unfortunately, I closed the position for a 20% gain only to watch it continue to move higher for the past week! Those April $85 call options I had purchased at $1.60 are now worth over $9, which is better than a 450% return in less than two weeks. I can't really be too happy about it, since I sold out of my calls at just under $2 on the first day of the expansion. Why did I do that?
Frankly, I was being far too conservative as a result of getting chewed up over the prior weeks, my emotions were running high and I didn't want to give back ANY gains. But in so doing, I ended up giving up the opportunity to have an absolute home run trade (would've been the best trade I've ever made).
Live and learn. Stay focused, and you will come to understand when the time is appropriate to be aggressive and when one should be more cautious. It's not always clear, and you will not always be right. But by learning reliable chart dynamics such as the volatility squeeze and expansion, and being a disciplined trader who stays involved, you will be able to make money. They key is discipline, as even though I haven't had the greatest couple of weeks relative to the market, I haven't really been losing money either, rather treading water. That's OK. So long as you can hold on to your dough, you'll be able to take advantage of future opportunities. The last thing you want to do is let your frustration lead you to be reckless in your trading.
Good luck!
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ben_dover0802
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Re: Stock Update for April 5, 2011 - CHK [Re: geokills]
#14243510 - 04/05/11 06:33 PM (12 years, 9 months ago) |
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Cool stuff, I learned a couple things in that little explanation. Maybe that's a clue I should have waited and studied more but eh - I am in the green so far.
I knew the top and bottom Bollinger Bands were a std. deviation (volatility) - but I didn't know they are generally cyclic and how expansion of the volatility can trigger a rapid increase or decrease in value. Also I feel I am fairly good at keeping my emotions in check but I haven't had a horrible/great day yet. I think the most I have gained or lost in a single day is about 1-1.5% of my entire portfolio...but the day will probably come - I will remember to try and be most efficient regardless of previous circumstances.
Anyway, thanks and good luck to you too!
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geokills
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Stock Update for April 6, 2011 - ISRG, SWKS, CHK, C [Re: ben_dover0802]
#14247455 - 04/06/11 01:33 PM (12 years, 9 months ago) |
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One more quick example of the power of a good volatility squeeze and subsequent expansion. Generally speaking, a volatility expansion that takes off from the 50 day moving average is going to be considerably more powerful than a squeeze that is occurring farther away from this key moving average. Here is Intuitive Surgical (ISRG) as of this very moment.

I missed the beginning of this expansion, but it's probably not too late to hop on board since volume is still increasing; however, I wouldn't take a huge position here, and would rather see a slight pull back to $356. I would then keep a sell stop or at least an alert below $345 (the breakout level coinciding with the prior high set on February 11th), since it is not terribly uncommon for volatility expansions (phase 1) to come back to test the breakout level (phase 2) before again powering higher (phase 3). Rather than testing the breakout level at $345, the stock may instead test its 20 day moving average which will be pulled up to that level and beyond if the stock continues to stay strong into next week. These are only tendencies and certainly not a guarantee for free money, but these tendencies have proven quite reliable throughout my time trading.
Speaking of tendencies, here's a bit of a volatility expansion to the downside:

You might have noticed that I was long the August $30 calls on Skyworks Solutions (SWKS). As I always harp on risk management being an absolute necessity to being a successful investor over the long term, I had an alert set on SWKS in the event that it started to break down below the lows it set earlier this week (which coincided with a base that was created in mid-March, indicating a key support level). Earlier this morning, when I was notified that the stock was breaking below yesterday's intraday low, I sold my August $30 calls for a 30% loss and immediately bought the April $30 puts. This is a very short term options contract that expires in 10 days, giving me the right (but not the obligation) to sell 100 shares of SWKS stock at $30 on or before April expiration (10 days from now). Because the stock was breaking through support and the bollinger bands were beginning to expand with price resolution to the downside, I felt comfortable taking this aggressive short term bet, and sure enough, the stock tumbled more than I had ever hoped for; bagging me a 120% gain on that put contract which I sold only an hour or two after I had initially bought it. This was part luck, as a story came out very soon after I had bought my puts, indicating that SWKS is anticipated to gain only $1-1.50 per iPhone5 compared to their current share of $4 for each iPhone4 that is sold. That's a pretty big draw-down in one of their main revenue streams, which will cause the stock to remain under pressure as their valuation will have to be revised due to reduced growth metrics. Fortunately, by having an alert set on the stock, I was able to anticipate the bad news since, clearly, someone probably knew about it which was why the stock was under pressure to begin with. Then the deal was sealed once the story was published by Forbes mid-day.
Next up, our good friend CHK (thanks again bendover for bringing this one up!)

In continuation of this discussion on volatility squeezes and expansions, I have bought some long dated call options on Chesapeake Energy (CHK), specifically the January 2012 $35 calls, which give me the right (but not the obligation) to buy CHK at $35 on or before January 21st 2012. I decided to go farther out in time on this name for a couple of reasons. In accordance with my recent (smaller) purchase of May $34 calls, I believe that CHK will move higher but I simply am not sure when exactly that will happen. The January 2012 calls give me a lot of time for the stock to work higher. Furthermore, there have been stories in the Wall Street Journal and on the cover of Time magazine talking up the real potential for shale based energy sources to help the US gain more energy independence. With the price of oil really getting high again (and the potential for it to get considerably worse given the turmoil in the Middle East), it seems reasonable that our government may finally decide to start pushing natural gas a little more over the next year. CHK would be a direct beneficiary of a movement in this direction. Even if this doesn't happen on the timetable I am proposing, CHK has great management and is a takeover target. If the current volatility squeeze resolves to the downside, I would be out of my May $34 calls lickity split, but would inversely get hungrier to add to my longer dated calls on this name.
Lastly, this one just came to my attention as I am writing this post: Citigroup (C)

The Bollinger Bands on the daily chart are not super duper tight, but they are tighter than they have been for about a month. There is an interesting dynamic here as the 200 day clearly seems to be functioning as support, and the 50 day moving average will be functioning as resistance. The fact that the stock jumped off of the 200 & 20 day moving averages to such an extent this morning and that trading volume is higher than usual, gives me a good feeling that this stock may be poised for an expansion that will ultimately break it out from its down trend. I've taken a small position here, which I will add to on a move above $4.70. Why $4.70? Because that would indicate a decisive breakout above the 50 day moving average as well as a breakout through the downtrending line that connects the high of $5.15 set on January 14th with the high of $4.96 set on February 18th. Whether or not this ultimately plays out, we'll just have to wait and see... but since I'm so busy talkin' about squeezes and expansions, I would be remiss not to take a chance on C!
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ben_dover0802
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Re: Stock Update for April 6, 2011 - ISRG, SWKS, CHK, C [Re: geokills]
#14254355 - 04/07/11 05:08 PM (12 years, 9 months ago) |
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Damn, today started off so nice - all gains lost by the end of the day.
CHK's nice gain did keep me in the neural position though, so not entirely bad. When I got up I saw Citigroup on the rise so I decided to go ahead and buy (pretty much at the peak), but then it started its slow decline to a very slight loss, boo. Hopefully it will still rally though, it looks like it wants to (I don't know how I can tell, I just can ).
I wanted to again bring up CAT, I bought this when you first mention it Geokills, but decided to hold on to it when you ditched it. A couple weeks back we see a nice volatility expansion gain (perfect timing eh?).

However, lately its been going down and I am getting a little anxious to sell and lock in some profit before it's too late. I am not sure the reason of the decline, maybe it just got overbought? Or if it is setting itself up for a second round rally which you previously mentioned sometimes happens? Just checking your thoughts, wise one
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geokills
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Re: Stock Update for April 6, 2011 - ISRG, SWKS, CHK, C [Re: ben_dover0802]
#14254706 - 04/07/11 06:07 PM (12 years, 9 months ago) |
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Quote:
When I got up I saw Citigroup on the rise so I decided to go ahead and buy (pretty much at the peak)
Remember, I mentioned that a pass through $4.70 would be a good signal that Citigroup is good to go higher. The stock peaked today at $4.69 before being rejected, indicating that the red resistance line I painted in the above post is still formidable. I still think Citigroup will break out, but this is precisely why position size is an important tool for risk management. I took a small position yesterday, and am waiting until the stock breaks through $4.70 to validate my thesis and thus, continue accumulating stock. I would suggest that you also work on trading in scales, using specific support and resistance areas on any given chart to trigger another scaled entry (or exit). Generally, you should put more emphasis on scaling into entries, whereas your exit strategy should often be a quicker process.
On Caterpillar (CAT), the chart technically looks ready to continue blowing off some steam, as downside volume has been increasing over the past three trading sessions. However, if you look at the weekly chart, this thing is in a very strong uptrend and there is nothing fundamental or technical to suggest that the long term uptrend is in jeopardy. If you are carrying an oversized position or are strictly short-term oriented, there's nothing wrong with taking some off right here as the stock could easily continue to see selling pressure or simply stall out for a couple more weeks before making its next run higher.
Nevertheless, I am expecting CAT to find some strong buying support around $104-105, which is some 5% lower than today's close. I believe buyers will step in here because this price level acted as resistance from February 11th through March 9th, and is now where the 50 day moving average is also perched. In fact, because CAT's management has spoken so strongly about the company's future guidance (and the Japan rebuild process will definitely add to their bottom line), I personally have an alert set just above $106, and if I see any buyers coming in at that level, I will take some stock while leaving room to add a second load if the stock experiences further weakness to its 50 day moving average.
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ben_dover0802
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Re: Stock Update for April 6, 2011 - ISRG, SWKS, CHK, C [Re: geokills]
#14255700 - 04/07/11 09:13 PM (12 years, 9 months ago) |
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Oh alright, I see what exactly what you mean, my mistake. Luckily I didn't buy too much C.
And I get your point on managing position size. I try and buy/sell in bigger chunks to reduce broker commission percentage, but I guess after it's all said and done the commission is considerably less than what can be lost on going too big on a risky trade.
I will probably end up keeping CAT, I am not in a big rush, just don't like seeing profits wither away. I agree the sheer number of construction needs in Japan should give CAT a healthy boost in the long run, just wanted to hear somebody else say it.
Thanks for your help again Geo! You're like the RR of shroomery's underpopulated money forums. I learn all kinds of things on this wonderful website.
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DieCommie

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Re: Stock Update for April 6, 2011 - ISRG, SWKS, CHK, C [Re: ben_dover0802]
#14256285 - 04/07/11 11:01 PM (12 years, 9 months ago) |
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Ive done well with CAT lately as well.
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geokills
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Stock Update for April 12, 2011 - Don't be a Hero [Re: geokills]
#14276899 - 04/12/11 08:30 AM (12 years, 9 months ago) |
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Citigroup was a failed breakout. CHK is resolving its volatility expansion, but not in the direction I had anticipated (it's falling below the 50 day and the lower bollinger band this morning). The overall market appears to be signaling what will at least be a short-term top, with the S&P failing to eclipse its February 18th high. I'm 70% cash now, carrying just a few high yielders (KMP, PSEC, and NLY), and a put position on the SPY; otherwise just waiting for better opportunities. Capital preservation is the key here, as the market looks intent on testing its March 16th lows which are still another 5% down on the major average. Probably won't happen right away, but that seems to be the direction we're heading. Protect your capital so that when the time is ripe, you'll have a lot of dry powder to put to work and won't just be trying to make up losses. Stay focused, stay disciplined.
On my shopping list (though I'm in NO HURRY to buy):- CMG - Announced impending launch of new Asian themed quick service restaurant, first location opening this summer in Washington, DC. Stock is bucking market weakness and up sharply on the news. However, given the time involved before the restaurant is even launched in conjunction with the threat of further market weakness, I'm waiting to get involved.
- SLW - The largest silver miner, the stock has been getting hit hard. Generally, entries have been few and far between on this high flier, and I am hoping to begin building a position on a test of the 50 day moving average just below $41.
- RIG - A long time favorite that has done very well for me throughout my entire time trading. It has been consolidating in a very tight range right at the 50 day moving average, a volatility squeeze to be sure. Given that oil is so expensive, I'd have to believe that RIG will see higher day rates for their drilling rigs and thus, improved earnings. Keeping an alert for price action above $82 which could indicate expansion to the upside.
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