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Tuesday, November 16, 2010

Portfolio change

I posted a portfolio change to the premium website

80 comments:

  1. I'll wait for a swing low before adding anymore and I haven't decided for sure I want to do that yet anyway.

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  2. dont forget to let the 'Toby Conner' boys know of the new post too :)

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  3. Agriculture getting smashed today as well.

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  4. Bloomberg headline today: "Gold Falls on Speculation Signs of Revived U.S. Economy Will Buoy Dollar"

    I mean, you can't make this stuff up. Shalom, did you send a directive to your man at Bloomberg?

    http://www.bloomberg.com/news/2010-11-16/gold-falls-on-speculation-signs-of-revived-u-s-economy-will-buoy-dollar.html

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  5. S&P metals & Mining (XME) seeing big BOW today too, with a large positive ratio. (Yes it's not a trading signal) but certainly a positive sign no less.

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  6. catbird,

    I had to do something. My QE2 is getting a lot of criticism, so I'm taking the heat off for awhile.

    Don't worry though, nothing has changed and everything is OK.

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  7. Shalom, thanks for the heads up re Ags.

    Do you own any Ags? GRU is one I have watched, held for a short while, but sold before the big runup. I may consider adding a bit here or when the swing low looks to be in.

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  8. Gary--
    If you were (i know you aren't) going to buy a slight in the money call option on a silver miner. How far out would you go-- Jan or March?
    I know you do not suggest but have done before and use little capital!
    thank you!!

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  9. Not yet, but would consider them as my 2nd choice after the metals bull.

    I believe that metals are going higher regardless of the $USD action. Of course, dollar spikes will impact the metals, but not as much as other commods that have impaired short term fundamentals.

    If I buy DAG, for example, it'll be more for diversification than that I think it'll outperform. If the doll-hair pukes, everything is going up.

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  10. Bad news guys...Tim Knight is long SLV now. More downside to come. :(

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  11. I think Jay might be right. Typically TK would be calling for the end of the bull and short metals with this action.

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  12. Thanks, SB.

    Did not know about DAG. I may consider that instead of or in addition to GRU. DAG is a double long, GRU is not.

    DAG tracks corn, wheat, soybean, and sugar, but should go up (or down!) twice the percentage that those four move.

    GRU tracks wheat, corn, soymeal, and beans, but is not double long.

    DAG includes sugar, GRU does not.

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  13. DAG also have a much higher volume, although the bid/ask spread on GRU is only 2 cents. So they're both good. Just depends on whether you want the double long exposure and whether you want to include or exclude sugar prices from the mix.

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  14. With the double etfs, I wait until they turn my direction, or at least momentum slows (if picking a turning point) before I enter. They're great when the wind is at your back, but devastating to hold going against.

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  15. SLV and AGQ both went positive!!!!

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  16. Gary,

    Do you generally see BoW on the SPY at/near the end of a daily cycle low?

    Today's BoW on the SPY is pitiful. Only 12 million.

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  17. anyone watching juniors??


    VGZ retested breakout area and 20 sma ...now up 3%


    not bad

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  18. PC,
    It's often only at intermediate turning points.

    Daniel,
    I'm not going to enable your addiction :)

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  19. Thanks Toby--
    I will make reservations at the addiction center (lol)

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  20. As much as some of you that think TK is always on the losing side of the trade, he was one of the few traders that saw this drop.

    The guy deserve some credit.

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  21. Calling a drop for 2 years straight and finally getting a small correction once in a while doesn't count. He's been heavily short on and off since March 2009.

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  22. Erich,

    A broken clock is right twice a day.

    TK's calls are always biased to the downside and he cant hold a long position for more than an hour.

    He promotes Prophet Charts (which is garbage for anything intraday) and tells everybody to buy his book (which explains nothing but how to use prophet).

    He wines and cries about his positions but then gloats when you have 1 down day.

    Guy is obnoxious!!!!

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  23. Wow, the USD is at 79.4 and rising.

    A couple weeks ago when Gary first mused that the USD might make a run at 80 and then (probably) get knocked down from that, it was hard to imagine it happening this quickly.

    In other news, I find it fascinating that silver has held up so much better than gold today.

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  24. Dollar hit resistance at the downtrend line from the June high and has backed off a bit. We'll see whether it will make another try at that TL and break thru. If it does, it will likely head for the top of the upper channel line of the uptrending channel from the Nov 4 low before pulling back. That upper channel line is right about 79.85 now, but by tomorrow morning it will be at 80.11. That's right in Gary's target zone of 80.

    We won't know whether the dollar is making a turnaround from this recent rally, though, until it breaks the lower channel line of that rising channel. Tomorrow morning that lower channel line is around 78.92.

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  25. Daniel,

    Yeah, talk about a big change on the BoW list! SPY now at the top of the list, although the number isn't that large by SPY standards (54 million), but still it's something.

    Bummer that GLD has dropped way down on the list and is now showing only 17 million, whereas earlier today it read 70.

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  26. EricH,

    TK has been calling for "this crash" for the last 18 months!

    Even a broken clock does better than that.

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  27. this is funny..posted on Bill downeys gold web site

    ""I just wanted you to know that not only did we raise margins last week............But we raised them Monday too..........and we decided to raise them again today. You see.....we will do everything to avoid the short squeeze you are all trying to bring on for the December delivery. That is why we waited until there was just two weeks notice for December futures to do this and why we are doing it as price DROPS. If you try and turn this around......we will raise them on Wednesday also."

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  28. does anyone here us TOS? i cant find the symbol to track the usd on this platform. only tracking it using uup right now.

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  29. /dx

    that is the futures contract

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  30. I bought a few probe positions to re-establish my holdings but I am likely selling them at the end of the day. I think we have one more gap down day to go.

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  31. Yeah, I bought some mmore EXK

    and Pal when it filled its gap and I will hold these long term.

    (unless we go beneath that $1315 on Gold...still watching the dollar too)

    It was only slightly scarey..I didnt need my wife to hit the 'buy' button, so there prob is a little more downside haha

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  32. SPY has completely disappeared from the BoW list. Looks like stocks are not done with this down move just yet.

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  33. I have purchased 2000 QLD as a trade into an anticipated rally over the next two days.

    My indicators show that this stock market decline isn't over. If the rally fails to show, I'll just use this purchase as my first leg into an "all in" long position.

    But my plan is to sell them into the rally.

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  34. Bought back EXK as well. Also added to SLW. I bought HZU (CDN equiv of AGQ) but sold that for a small profit.

    Still only about 30% invested.

    With the 2x ETFs I don't like to hold them overnight unless I have a built in cushion (profit) by end of day.

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  35. $1,315 or not, if we don't bounce from this $90 3 day decline I would consider that bearish. First new long call positions (GDXJ) established right at the close today. Will wait for the post bounce to see if we can sustain the uptrend. Timing has been fairly easy to date, let's hope the script continues to unfold.

    http://3.bp.blogspot.com/_H2DePAZe2gA/TOLyrHj55ZI/AAAAAAAAPFw/1lsnIqOs2ZU/s1600/golddaily19.PNG

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  36. sending portfolio changes should really be sent to the subscribers emails ...they are'nt big and if you really want to disseminate the info doesnt that make sense?

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  37. sending portfolio changes should really be sent to the subscribers emails ...they are'nt big and if you really want to disseminate the info doesnt that make sense?

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  38. GLD has disappeared from the BoW list too...

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  39. H,
    It's not the size of the message it's the number of recipent's that prevents me from emailing. If my email provider flags it as spam they shut down my outgoing email for three hours. I can't take a chance of being dead in the water for three hours during the week.

    On Sunday's with the password it's OK. If I don't get it all out at once I can just wait and send out another batch as soon as I'm back up and runnning.

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  40. Please no TK bashing. He has a different style of trading than Gary. Learn how he is still in the game after 20 months of a bull market.

    TK can manage 200 positions, enters them at good risk-reward points, cuts his losers and lets his winners stop him out. A lot of traders will benefit if they can incorporate his position entry and management style with their winning picks.

    With proper money management, even absolutely random strategy can be made profitable.

    Silver today showed great relative strength compared to gold, which came down to its post FOMC lows before finding buyers. This is kind of odd but shows that the bullish sentiment towards PMs, especially silver is still alive and kicking. This may lead to a bounce but more likely than not result in more pain; silver needs to form a base before launching higher again.

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  41. "Please no TK bashing. He has a different style of trading than Gary."- aviat

    Yeah, not only a consistently losing one, but one that will blow out an account entirely in less than 3 months. If TK were actually trading his market calls, I'd wager he would have blown out several times over.

    No offense to you aviat, follow him if you like, but please don't ask me to quit calling out the facts b/c you're sympthetic. Free speech is what you should support. It's not like we're at his site destroying his project, just that some of us consider him a pretty good fade.

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  42. Gary,

    Would welcome your thoughts on silver's impressive outperformance today (perhaps in tonight's update). It basically closed unchanged.

    Thx

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  43. The number of positions has nothing to do with profitability. In fact, the firm I worked with in the 1990's circulated a report on benefits of diversification, and the jist was that any more than 8 positions didn't benefit the investor, and might actually dent returns. (more to keep up with, poorer executions, and higher commissions w/smaller size per).

    It's an illusion sold on Wall Street to justify management expenses. TK's position overload was the first sign to me that he was not profitable, the second was he was typically a buyer of options, and while I don't mess with options frequently, it's obvious only sellers of them make money over the long haul.

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  44. Gary: Can you please tell me where you gut the up volume/down volume numbers you use. Here's the link to Yahoo which shows 94% down on the AMEX but not anywhere near that on the NYSE. ???
    http://finance.yahoo.com/advances

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  45. Richard Russell publishes the Lowry's volume data daily. I'm just assuming he has the correct data.

    Maybe I shouldn't assume :)

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  46. Please take a look at that yahoo link, if you have a moment. The difference is dramatic and I'd hate to use data that is so badly off. Am I missing something? Hard to believe RR is, but 2-1 is not 10-1 by any stretch!

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  47. One has to wonder why the NYSE data is so light when the AMEX and Nasdaq were both extreme. I wonder if there is a mistake in the Yahoo data feed for the NYSE.

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  48. Checked it in stockcharts.com, which pretty closely agrees with Yahoo. Seems RR was wrong. I don't know why the Amex was so skewed except it is super thin and a few big trades can skew it. Also, it's where resource stuff trades, and they got socked today. No 9-1 doesn't really change things but i don;t like getting bad data.

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  49. Interesting. Here's the data from the WSJ and it shows 14-1. What the hell?!

    Share Volume
    Advancing 88,439,103
    Declining 1,262,384,961
    Unchanged 3,398,953 1

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  50. From StockCharts:

    chart

    Shows down:up volume ending the day at 14.25:1

    Here's the Naz:

    chart

    9.84:1

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  51. I think I'll stick with Richard Russell and the Lowry's data :)

    It's really not all that impoortant to me other than as a sign of panic selling and that's usually pretty obvious just by the price action.

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  52. And you can see that it reached as high as 25:1 in the morning. And issues traded reached almost 17:1 decliners/advancers.

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  53. Gary,

    You may want to take a look at this:

    http://pragcap.com/m3-contracting-3-yoy-pace

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  54. Gary, you mention that silver has not moved much today in comparison to gold but measuring from the top it is down 15% compared to 6% for gold, couldn't the tame moved be explained by the presence of the psychological level at 25? it doesnt seem likely that it would just slice through $25 like it was not there

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  55. Unfortunately the dollar and true inflation contradicts the authors assumptions.

    Oil wouldn't have reached almost $90 if there was no expansion of the money supply. Gold wouldn't have risen to over $1400 if there was no expansion of the money supply. Grains wouldn't have been trading limit up for days if there was no expansion of the money suppy. Silver wouldn't have rallied to almost $30 if there was no expansion of the money supply.

    And the dollar wouldn't have dropped from 89 to 76 in 5 months if there was no expansion of the money supply.

    Sometimes I'm simply amazed at what humans can convince themselves of when just a little common sense would reveal the truth.

    There is a reason commodities are surging. It's because the Fed is printing and some of that liqudity is finding it's way into the commodity markets along with other asset markets.

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  56. Raz,
    If you've watched silver for as long as I have you would know something is going on in the silver market right now.

    Silver is a thin market and as such technicals are virtually meaningless. It doesn't take much selling pressure to produce a huge move in such a thin market. Under normal conditions a 2% down day in gold would produce a 5+% move down in silver.

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  57. On Silver. In a note today by NS Futures posted at Kitco, they write CRIMEX Silver Stocks down 16 of last 20 days and are at lowest levels since '06. Somebody is making at run at the big bullion banks, the shorts on the Crimex...and it couldn't happen to a sleazier group of folks. Its not like they -banks- can turn to their Central Banking buddies to "borrow" Silver or "swap" Silver..cause they don't have any reserves either. And I think their might be something to Bill Downey's sarcasm I posted earlier about the CME raising margin rates every day while PRICE drops..protecting their buddies best they can. I hope they lose billions.

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  58. SB:

    If you want to bash TK, go start your own blog. This is not an issue of free speech; bashing him does not add to the content on SMT.

    It is fashionable to bash him because he is so public and vocal about what he does. You can learn something from everyone's style; even their mistakes.

    And do you seriously believe that eight positions are diversified enough for a short portfolio? What if two of those eight get bought out at a 100% premium, and you end up with a 25% loss overnight?

    Unlike other big short shops, who look at fundamentals, strategic position etc, to form their short thesis, TK trades chart patterns; he does not have the resources to investigate the fundamentals, the chance of buy-out etc. However, he can review 200 charts everyday.


    There is a place for short positions in any large portfolio; that is why there are people who use his services. And there is also a place for options; ask those who got 20 baggers on AGQ. The challenge lies in allocating the appropriate amount of capital for your portfolio size. Trade Management, and sizing is what TK does best.

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  59. Thanks Onlooker---got it. I wonder what that Yahoo site was showing?

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  60. aviat,

    The guy who had a "20 bagger" on AGQ had $200 invested, so get real.

    You say "And do you seriously believe that eight positions are diversified enough for a short portfolio?"

    Long or short doesn't matter, over 8 positions is a waste of resources with no added benefit. You imply I'm against shorting, yet I do it all the time. I'm just not a permabear, especially in bull markets. I suspect by your comment you are attracted to shorting for other reasons than to be profitable.

    You said "that is why there are people who use his services. "

    What services? I wasn't aware TK was now charging for his awesome advice? :)

    "It is fashionable to bash him because he is so public and vocal about what he does. You can learn something from everyone's style; even their mistakes."

    Like I said, he's been a great fade. Nothing better than learning AND profiting from others mistakes.

    "There is a place for short positions in any large portfolio;"

    Why do you assume his portfolio is "large"? I think you're confusing number of positions with size of positions. If one has $20 million in 8 names, while the other has 2 calls on 200 names each, who has the larger portfolio?

    And last, "If you want to bash TK, go start your own blog. This is not an issue of free speech; bashing him does not add to the content on SMT. "

    Neither does defending a consistent loser (in trading) "add content" to SMT. It is YOU that should go start your own blog, or at least agree to hear what others have to say here. My point is that you should not determine what is said, only what you choose to believe. Don't tell others to squash what the observe.

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  61. I sure appreciate that TK sticks to his guns, but a money manager of his size can never ignore the trend and that is what he has done for almost 2 years now. How do you explain to your investors that you are betting against the trend? Shorting off charts against an uptrend is a losing battle. Smart shorts have lengthy explanations of why the company is a loser.....

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  62. SB

    I appreciate your bashing someone if they are blatently wrong repeatedly, so that newbies wont follow him off a cliff.

    oh , and by the way, I think we just found out that TK's blog name on here begins with an 'A'

    then a 'V'...etc etc haha :)

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  63. This comment has been removed by the author.

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  64. More margin hikes in the PM market:

    http://www.kitco.com/reports/KitcoNews20101116AS_cme.html

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  65. GGuy, if you are here, please, explain the chart on eur/usd you posted one or two days ago. According it our next spring"s "great gold surprise" may be in danger? Surely, european authorities will dump euro to dollar in order it coudn't reach the level for example 2-1 to $ by various bailout measures/Greece, Ireland etc./ and even in such "bailout" enviorenment gold jumped in may but then filled the gap in summer inspite of declining $. Your chart suggests we may not see uptrend in gold next spring or see even decline? Or i'm missing smth? Please, answer and explain your chart.

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  66. Re silver's relative strenght on Tuesday:
    Seems to me a massive falling wedge is forming in silver (best seen on the hourly chart) that should -or at least may very well- break equally massive to the upside. (Left side 26.45/29.35 on Nov 9, lowest right point so far approx 25). I know patterns aren't the holy grail, but it's still nice to see this one clearly not spelling doom at all.

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  67. @Andy: my charts are on EUR/USD cycles. Can you please link the one you are referring to?

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  68. Walter

    I use charts , cycles, and whatever other tool fits into my toolbox, so thx for pointing that falling wedge out

    I see it on a 10 day /hourly quite clearly in silver , and also EXK and Hecla (HL) and some other silver stocks.

    It looks like maybe 2 to 4 hours more downside possible and the apex is reached...something to keep an eye on anyways...

    Thx

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  69. http://img717.imageshack.us/img717/3108/eurocycles.jpg GGuy,I was interested in this one.Please, answer,what does it mean for perspectives of DXY in near future and next spring? And its influence on gold price.

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  70. Covered some shorts yesterday; will do the rest today. SPX about to rally based on several non-correlated approaches. Let's hope the PM's join it. I am not a 100% PM's guy and so will "waste some time" (Gary's words) on stocks and be long soon ;)

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  71. DG,

    Me too, but to be honest it was one of the easier trade of the year, the trade setup a mile away.

    SB,
    That "20 bagger" was on $270, not $200, get your facts straight (kidding)and did I mention the fistful of "10 baggers", LOL.
    In all seriousness, you're all wasting your time arguing, nobody truly cares and Gary will be onto a new post before you know it :)

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  72. I did not find it so easy. I had lost on a few short setups prior. My sense is that the fed's pumping is overwhelming some of my most reliable short term indicators. I am having a good year, but my short terms shorts as a class have not been successful, which is unusual for me. This last one worked---finally---but we'll see about the future. Glad it worked easily and well for you. Let me know in real time what you short next. I usually post mine here (OIH, AMZN, and SPY this time)

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