Words With Friends, Euro Style

shark1 300x270 Words With Friends, Euro Style

Brussells will have more action than Mardi Gras over the next two days. The heads of the euro families all sit down for another photo op. Here are some words and phrases that you will  hear for the next 48 hours.

Attempt- Italy just popped on a report that the EU will “attempt” to reduce borrowing costs

Eurobonds- This is the presumed cure for all ills. Will Merkel acquiesce so Europe can retire at fifty five from no show jobs while Germany busts it to sixty five?

More meetings- A more pleasant phrase for kick the can some more.

Concerted effort- It’s tough enough to get two to agree, so seventeen countries is a push to say the least.

Shared liability- Kind of like shared sacrifice here

Banking Union, Fiscal Union, Political Union-organizing these three things is like splitting an atom with a baseball bat.

Rescue Funds- Who are they and how much?

So today should be fun as we also have the Supreme Court ruling, contempt charges, weekly jobless claims and adjusted GDP.

Just another day.

$SPY $UUP $QQQ $EURUSD

 

 

 

 

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Coal…Doubles or Donuts?

kol1 300x197 Coal...Doubles or Donuts?
Coal ETF

Coal is trading like it’s going to zero. As you can see above, the $KOL etf has a prominent head and shoulders pattern and it has pretty much broken the neckline on the weekly chart.

I remember back in April natural gas was also going to zero. $UNG, the etf for nat. gas, was trading at roughly 14 bucks, but two months later it trades at 19 which is about where t closed yesterday. That’s about 40% in two months. The technical pattern now looks uber bullish and frankly it looks higher.

Coal has mega challenges with the EPA, China slowing, the planet slowing etc..

So will coal see 50% + returns from these levels over the next six to twelve months? I say they do. Buy em’ when they’re cryin’ I say.

Long $ANR $WLT $ACI

 

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A Meeting of the Mindless

cabos 300x204 A Meeting of the Mindless

Another “we are the world” moment has kicked off in sunny Los Cabos, Mexico. The sevants who have imploded the global utopia will all belly up for rum runners and wave runners as  the Spanish 10 year tags 7.09%. They call it an “informal meeting”, so I guess it will take absolute disaster to get them off their parasails and banana boats. It will be one big telethon.

Denmark just sold paper at a first time negative yield, but everybody else in Europe is paying through the nose this morning.

Spain just announced that they will delay  detailed bank audit results until September. Nothing like more fog and uncertainty to start the day.

I’ve enjoyed all the apocalyptic rhetoric because the tape only goes higher. I’ve been scaling out of some names on strength, raising stops, but I’m also adding some some new things. The tape is still rotating and that won’t change.

$AAPL looks excellent again on the charts by the way.

I’m starting positions in the coal names as I think the sector will have a great second half. They will either all go bankrupt or I will make a fortune. ($KOL)

For information about this site or to request performance for June, email: upsidetrader@gmail.com

Oh, and never do this

typrwriting 300x223 A Meeting of the Mindless

 

 

 

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The Tale of the Tape

 

spx91 300x197 The Tale of the Tape

I’ve been very bullish the last three weeks. You have seen me tweet things like “buy em’ when they’re dyin” or “buy the fear” I’ve abused cliches such as “they don’t ring a bell at the bottom”. I’ve strongly recommended that you avoid the media through this period and to run far and fast from those that just regurgitate the obvious negativity . Really,where is the value in that?

Last weekend I suggested that we would rip higher because I thought the planet was leaning the wrong way on euro shorts and treasury longs. We were long $FXE and short $TLT because of this. So far so good.

So what now? In last weekend’s piece I talked about the McClellan folks and how sentiment for stocks was in the dirt. I love extremes and got very long there. This week they show a chart of the Oscillator being short term overbought. Understand that in the past, these overbought reading have led to more overbought conditions, so it doesn’t mean you should sell, just be careful.

overbought 300x172 The Tale of the Tape

“The strong breadth numbers on the NYSE have produced a reading of +164.60 on June 15, 2012.  That is above the +150 level that has been marking an overbought threshold in recent years, and thus it indicates an overbought condition.  But at the same time, it also signals strong upward initiation for this new price uptrend.  It does that because this overbought reading occurs within a complex structure above zero, which is a statement that the bulls are in charge.

So what this means, is that even after last week’s move higher, we can still go higher. But remember, this isn’t your father’s stock market, and even though these indicators can be helpful, we still have macro events that can turn this thing on a dime.

There will be opportunities galore going forward both long and short, but I felt and still feel a very substantial bid underneath this tape. Bad news is good right now. Remember that.  It’s an odd dynamic, but one that can be very profitable.

On a contrarian basis I think the coal stocks will show big returns over the next 90 days. They are too hated and will NOT go out of business. China still burns that black rock and deregulation will probably help matters down the road. Remember, “buy em’ when they’re cryin”

I like coal sector $KOL, energy $XLE, $AAPL and various other longs that have been pulverized.

I don’t care what happens in Europe. It’s out of my control. Yeah I’m the guy that’s up at 4:30 everyday reading everything there is on Europe and China, but I try to use it to my advantage. The world is bigger than me, but if I can catch a little daylight and be right, I can piggy back the world to  great P&L results. When everyone is leaning too hard one way, they only have one way to lean eventually….the other way.

Subscribers have had a great month so far in June. If you would like more info or to request performance email: upsidetrader@gmail.com

Good luck next week.

Other Posts of interest

Everybody Gets One

Here’s What Will Happen

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Everybody Gets One

 

The Greeks said they didn’t need a bailout, they lied and got one, Spain as recently as last week lied and  said they were just fine, but grabbed a one hundred billion bank bailout this weekend, (they will need more and will get it). Italy is now saying they don’t need a bailout, they will be rubbed with extra virgin olive oil soon. Spain got a little cash, but they will need more and they will get it  Ireland is in the rear view mirror. Portugal will be like Ireland and they will get their own band aid soon. You don’t hear much from Ireland lately do you?, It’s back page.

Is everything fixed? No. The crash will be magnificent, just not yet. They all lie and still get a handout. Expect this behavior to continue until we all run out of money.

Watch the white downtrend line on the chart below, a break above will take us even higher. A break of the white uptrend line could bring issues to the downside. The range that we are in now is very tight and getting squeezed.  I think big things are going to happen either way soon. The trend lines lines are highlighted with red arrows.

spx90 300x197 Everybody Gets One
S&P 500

I put $AAPL on for subscribers as a long on May 1 at 536. I like the action. The stock is consolidating and looks higher. The stock, like the rest of the pack can’t do it with out the market at it’s back, but I see this one much higher soon.

aapl14 300x187 Everybody Gets One
AAPL

 

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