Friday 23 November 2012

Market Gives Thanksgiving Gifts.

Hope you all had a great ThanksGiving. Today the half day session presented quite a nice Turkey, deep fried Texas style. Only folks complaining were Zerohedge who found many reasons why this is a fake rally. Most likely they do not read this blog otherwise they would have known that we have called for this bounce weeks back. We can also tell them that this bounce will continue for better part of next week. It does not mean we are long. But we can save them lots of heartache and agro.

Those of you who lost tons of money since 2009 getting caught up in bear talk and that imminent collapse here is one blog you must read everyday just to re-wire the brain.

Bill was 1st to start financial blogging before doom and gloom blog became fashionable and he identified the collapse of the financial system in 2007. He is a genuine person who is not into ranting and always gives facts to justify his position. His website is hosted here in America and he does not get money from anybody to create negative propaganda. This one is a must read for those of you who have been brain-wasted by Voldemort.

Anyway, the half day session saw all risk assets rip higher. Gold and silver had a nice jump and most likely the trade suggested by Stock Trader’s Almanac is going to be winner 13 year in a row. But if you also remember, the exit date of that trade is around December 2-4. So if you are long PM as a trade, remember to take profit. Crude however is moving in the range. But the most important thing which I thought worth mentioning today is the dollar index.

US$ Index dived almost 1% which is a big move in one day and no wonder PMs are jumping higher. But crude has not been able to close higher when USD is at a low, it does not bode well for crude in future. This chart of crude is from Lance Roberts.

I had written before that Crude may bounce upto $ 91-92 and this chart supports my calculation. Should Crude reach that level and Dollar Index reach 79.50 in the next 3 or 4 trading sessions, it will set up a nice short entry.

Nat.Gas reached close to my up-side projection and I had closed half my position. Most likely I will look for getting out of the rest by next week. I expect Nat.Gas to go up $ 6 but in short term, it has gone up almost 50% in 6 months and is time for some pull back. It may not happen but why take the risk.

Equities most likely will see some pull back on Monday before one final push up. The sell set up will kick in around 1425-30 or November 29th, whichever comes 1st. And this time I plan to go short with some leveraged ETFs.

In my last post I wrote about coffee. I think it is bottoming and look for the confirmation as highlighted by our dear reader in the last post. This has to be a long term trade and have your stop loss according to your risk tolerance level.

So you see, we have lots of opportunities coming up next week.  Santa is giving you advance gifts and I hope you will be nimble enough to grab them. I cannot directly tell you what trade to take. I can only say what I have done. So join me in Tweeter because I will tweet as I take a trade. Also please share the blog with your friends who may benefit from it.

Enjoy your long weekend and have fun. Thanks for your donations and supports. The blog now has a link for a job board and I hope it will be useful to some of you. Looking for your feedbacks and questions.


  1. Thanks for your selfless advice! What is your twitter handle?

  2. Thank you for sharing your wisdom and knowledge thru this blog!

    What are the best safe leveraged ETFs for shorting? Thanks in advance!

    1. Over a longer term leveraged ETFs lose value but they are ok for a shorter period. There is no such thing as safe leveraged ETF but please go through this list:
      You will find a whole list and then do your analysis to select those which you would like.
      I would probably go for FAZ, TZA, SDS, SQQQ but would love to hear from readers about their recommendations.

    2. Thank you for your quick response!

      In terms of shorter period, what's the maximum period (number of day/weeks) these ETFs can be held before they start losing value.

      Thanks again!

    3. That depends. I do not hold them for more than a month. Close position very often even if I have to re-enter later.
      May be this article will explain better:

  3. Thanks for your advice. You seem like a stand up guy with no hidden agenda. In the current market, do you recommend looking only at the short term? Or are there some longer term strategies that make sense too?

    1. Thanks. Some longer term trends will develop by end of the year, like gold. Nat.Gas is a long term buy but will most likely pull back short term.