Indices are trying to digest "huge gains of 37.99% in S&P 500".....
We are basing in a range of 875 to 956 in S&P 500.......
We have 2 more days left to end the month & Q2..which MAY propel US either to high end of the range or MAY even exceed......
The question is what happens after Q2 ends???
I have a "feeling" that we are going to stay in the trading range & MAY go lower than 875 to 850 in S&P 500....
IF... we go to S&P 500 to 850 then high end of the range will come down to 925...thus a new trading range will come into play.....
WHY there is a possibility of lower trading range......???
I have a feeling that guidance for Q3 MAY not be "as expected"......
I also did NOT see the high volume lately which is NEVER a good sign.....
I am also looking @ RSI for many stocks & they are staying @ or LOWER than their recent trading range...this goes for indices & stocks...again NOT a good sign.....
So....
How to trade this market?
IF you are an investor then buy near 850 in S&P 500....
IF you are a daytrader then lock smaller gains...
IF you are a swing trader like me..then locking gains @ the end of the day MAY be desirable...
SO ...by the close of Tuesday....I have to figure out how to position going into July......
I WANT to reduce my exposure to techs in July as they are most "vulnerable" to any rangebound trading...
I still believe that all commodities trade SHOULD work out from July to Sep...this includes Oil stocks,Solar,Gold,Infrastructure,Steel,Copper,Aluminium...
As to AG stocks..they are NOT going to show any life till a new contract is signed by POT with China & India...market then have to evaluate the profit picture based on contract....so AG MAY also test its support & may go into LOWER trading range.....
SO...the bottom line is.... Q3 MAY be challenging to BULLS......
I also see "complacency" as too many "bullish commentary" on CNBC...as IF we have NOTHING to worry & keep BUYING???
My conclusions are based on "weak TAPE" & " euphoric sentiment"......
WEAK tape has certainly surprised me as we seems to be struggling even on UP days..also UP days are NOT very strong and there is NO strong follow thru....
I monitor RSI closely which also has given me PAUSE in my bullish thesis "going forward".....
Here is the RSI for many stocks including my holdings*:
*MRVL..51.97
*SOL...54.23
*TLM...45.85
RIMM..40.94
AAPL..62.25
POT...37.94
AGU...37.64
IPI...46.94
BIDU..61.85
GOOG..58.13
BRCM..48.64
JNPR..48.50
FSLR..39.71
TSL...53.44
ABX...53.20
GG....54.13
X....55.89
GS....57.82
V.....49.15
MA....53.23
S&P 500..52.18
Dow.....47.63
Nasdaq..58.47
I have colour coded all the RSI based on the "current TAPE"
GREEN is healthy tape
BLUE is neutral
RED is WEAK
SOMETIMES buying "NEUTRAL/WEAK" MAY be the safest strategy in a downsloping market???
It is extremely important to get the DIRECTION of market first.....then select stocks accordingly.....
EASY money has been made which even covered up for lot of trading mistakes.....BUT NOW there is very little room for error going forward.....
Making money has been tough lately & it WILL get TOUGHER......
SO..think...before you hit "buy" or "sell" button.....
As we seems to be rangebound "within 9.25%".....ONE bad stock can hurt your returns....
Good luck with your OWN homework because..I have been WRONG about the direction of market for 2nd half of 2008 & early part of 2009.....
BLOG does NOT give buy or sell.
Saleem
10 comments:
Hi Saleem,
Interesting commentary today. The usual summer malaze has set in. I don't see much going forward until fall. A stock pickers market again. There will be gems to be bought, if anyone spots one pass it along. Sell calls on your stocks in a flat market for extra income or too lower your basis while we wait.
Best Regards
Hi Standards,
Thanks for your feedback.
When "sell in July & come back in Sep" sets in.....few things to remeber :
-Avoid loss....
-Book gains.....
-Those who want to maintain their position..covered write is a great idea....lot of premium CAN be booked for next 60 days...
Saleem
Have been watching CHBT for about 3 months was a little shy when it fell into the $8s then came back to over $10 figured I missed it so kinda left it off the radar then Friday it trade's over 1M share's & up almost $6 buck's damn. Yahoo headline has a video with CEO on it a good watch plus some international fund is heavy in it.
Hey Happy Sunday to all
I am looking at the July covered calls on GE this week
I was hoping for a little more appreciation--NOT
So I would love to get calls at $13 at a good price
Thoughts appreciated
Regards to all of you
Hello again
Some NOTES on Tankers/Crude carriers:
I Own FRO
VLCC spot rates climbing
25th June 2009 08:56 GMT
Reports of increasing OPEC output on the rise
Spot VLCC activity remained robust this week and rates in several markets managed to pick up a few Worldscale points with brokers reporting increasing exports from the MEG.
While MEG-West routes stayed flat at WS 35, several MEG-East voyages have been fixed this week at WS 55, brokers tell Tankerworld, up from around WS 50 last week.
Bluelight for example, was reported mid-week to have fixed the Asian Progress II to move 265,000 tonnes of MEG crude to China for loading on July 11 at WS 55.
The Atlantic market meanwhile, also picked up with benchmark voyages from West Africa to the US Gulf being reported closer to WS 58 compared to around WS 55 last week.
One broker maintained that the Atlantic market “held up better” than the MEG markets “due to a more limited supply of tonnage which afforded charterers less of a choice when seeking coverage.”
"The current momentum is in the owners' favour and there no signs that rates would go down"
At the rate of WS 58 owners are reportedly earning around $44,000 per day per vessel in TCE earnings on voyages from West Africa to the US Gulf.
Owners plying the MEG-East routes are making around $43,000 per day per vessel in TCE earnings given the average rate of WS 55, brokers tell Tankerworld, while MEG-West voyages are only achieving some $20,000 per day per vessel.
Even though some brokers reported activity this week to be slightly less than last week, the amount of VLCCs being taken out of spot availability for floating storage purposes seems to be mitigating any downward pressure on rates by overcapacity.
Aside from the storage of crude to take advantage of contango premiums, several brokers are reporting an increasing number of VLCC newbuildings being fixed straight upon delivery from the yard to store clean petroleum products (CPP) before ever taking on crude cargoes.
with onshore storage already filled to maximum capacity, refiners are taking advantage of the recent slump in VLCC rates to store their CPP for sale at a later date.
“There is a large number of ships on storage in CPP including brand new VLCCs,” one broker was quoted saying.
Going forward some brokers are saying that “rates are going upwards” as a result of some kind of balance being achieved between demand and supply. One said that “the current momentum is in the owners' favour and there no signs that rates would go down.”
Supporting that sentiment would be several reports over the past few days that many OPEC members are steadily increasing their export volumes instead of trying to constantly cut supply till agreed quotas are met.
Neil McMahon, from Bernstein Research, was quoted saying this week that Saudi loadings have increased over the last fortnight while other OPEC producers have stepped up production, in contravention of agreed OPEC restrictions.
And two weeks ago, Pareto Securities stated that OPEC was shipping out more oil, a move which has helped boost VLCC spot rates.
OPEC's Middle East members including Saudi Arabia raised monthly shipments to about 95 cargoes in May, from about 85 in previous months this year, Pareto analyst Ole-Rikard Hammer told Bloomberg.
According to Hammer then, demand for tankers in the three prior weeks suggested a further 95 cargoes this month.
“Demand for crude oil bottomed in the second quarter,” he said. “OPEC is beginning to leak a few more cargoes into the market.”
IMAREX on the other hand, remains optimistic, commenting today that another day of “impressive activity keeps rates firm as a replacement job was done at WS 55, same as the highs of the previous day.”
“The last time DHs [double hulls] went this high was in late January. More second decade cargoes should be coming out soon and this will only be good news for rates,” it added.
Cowan Thant Zin, 25th June 2009 08:56 GMT
Hi MadMax,
15 trading days left before Jul expiration. GE could easily pass the 12 strike price in one up day. I like the 13 myself. We will get a better opportunity after a short rally.
Best Regards
Hi Dugtherug,
CHBT average daily trading 19,000 shrs, on Friday over 1 million!!!
A 56% increase in stock price in one day. That's great! Real scary at this price. Unusual.
Best Regards
Hi Madmax,
Thanks for posting tankers report..
What is MEG....
Can you tell me the impact on FRO based on this report..as they have not mentioned any stocks which I follow...
Thanks !!!!
Saleem
SALEEM
AS for FRO: They are a lot healthier than 6 mths ago.
Rates for oil are up big! And we have the fandango going on too! Oil storage in VLCC that ties up ships so rates are climbing for shipping (not enought ship availability)--all IMHO!
Here is some tanker news:
MEG
Middle East Gulf Market:
Fearnleys pegged WAF-US Gulf voyages to have moved from WS 72.5 last week to WS 110 this week, while MEG-East voyages picked up close to 10 Worldscale points to stay around WS 70 for double hull fixtures.
One Singapore-based broker told Tanekrworld Thursday that MEG-East rates "are already hitting WS 75" for some fixtures.
There are even rumours of an MEG-China voyage being fixed at WS 87 for late December loading.
Brokers had informed Tankerworld last Thursday of at least two confirmed double hull fixtures to move 265,000 metric tonnes (mt) of MEG crude to Taiwan and another Far East port for December loading dates at around WS 62.
Enjoy again I am a long term holder of FRO at $32 a share!
Hi Madmax,
Thanks for your feedback on FRO.
Saleem
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