Sunday, May 31, 2009
The chart shows that this stock (UYG) is in a volatility squeeze. The stock has formed a descending triangle. The hope is that the stock will break to the up side through the resistance – passing the volatility test. Any trade I do will be above the upper resistance line, showing that the stock has passed the volatility test.
I have marked where I believe this stock is headed – the $4.50 to $5.00 price target. If you look at the dotted red line (the support level) you will see that the stock is sitting at a key support level. If the stock was to break down below the support level then this would be a Bear Trade. Keep in mind the stock is trading at a huge discount allowing you to get into the financials at rock bottom prices.
Click on the chart:
Whether or not I believe the market is at a key point is irrelevant to me because I am a technical trader. I take what market gives me. I trade the charts not the companies.
Sunday, May 24, 2009
With bad news larking around every corner it looks like this up trending market is here to stay - or is it. If you listen to the talking heads on tv you don’t know what to believe, but if you listen to the chart it tells you what is going to happen. This market has moved up mainly on weak volatility. Its been short sellers covering their short positions, like I have been, and buying stocks that are squeezing the shorts out thus pushing the stocks higher. If you look at the chart you will see.
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NEW UP DATE 070309
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new update 07/11/09
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Friday, May 22, 2009
In a report compiled by BNP Paribas, strategist Andrew Chaveriat said that Gold Investment interest may rise on the back of inflationary fears over the coming months.
Gold is traditionally seen as a safe haven in times of economic uncertainty, and the decision of governments to use quantitative easing to stimulate their national economies has prompted concern that recession could be followed by a period of inflation.
"Longer-term inflation worries will continue to shape demand for gold," Mr. Chaveriat confirmed in the report.
According to Bloomberg, Mr. Chaveriat went on to predict that gold would make a "creeping advance" towards record price highs, marking the yellow metal out as a sound long-term investment.
He noted that chart patterns hint a level above $1,000 could be achieved within the next few months.
Meanwhile, a UBS report indicated a "bullish outlook" for gold with prices moving in a "positive but slowing way", Bloomberg states.
Given verbiage from Fed Chief Ben Bernanke and others, it would seem as though the US economy should be on the road to recovery by the end of the year. This suggests that safe-money investors who jumped out of stocks and other risky investments may pull money from gold when they are more comfortable in growth investing.
However, there is still some uncertainty over recovery prospects in many major US market sectors. Hopes for a housing rebound took a hit Tuesday (May 19) as new home building saw its all-time low water mark. There is also still unease about the credit sector. The US car industry is in constant turmoil. Unemployment is near 9 per cent. So, all is not well again in the US economy.
Immediate-delivery gold was little changed at $952.45 an ounce at 12:27 p.m. in Singapore after touching $956.55 yesterday, the highest since March 23. The metal has climbed about 7.2 percent this month and is about 19 percent higher than this year’s low of $802.59 an ounce. Silver, which dropped 0.2 percent to $14.49 an ounce, is still up 3.5 percent this week.
Bill Gross, co-chief investment officer of Pacific Investment Management Co. in Newport Beach, California, said yesterday that the U.S.’s top AAA credit rating will “eventually” be lost. “The markets are beginning to anticipate the possibility of” a downgrade, Gross said.
The Dollar Index, a measure of the greenback against six major currencies, has lost 3.2 percent this week on speculation that the U.S. government’s creditworthiness may be weakening, after Standard & Poor’s yesterday cut its outlook on the U.K.’s AAA credit rating to “negative” from “stable.”
“Investor interest in gold was bolstered by the declines in international equity markets and the soft tone of the U.S. dollar,” David Moore, chief commodity strategist at Commonwealth Bank of Australia, said in an e-mail today. What this means for the average investor basically short term you can trade around the gld or do a more sophisticated trade like the I did making 43% return for the month update on the GLD trade take a look