The last ten days have showed violent bounces that have made entry much more difficult, as the market would move from overbought to oversold, and then began flat-lining.
All of this leads back to the head and shoulders struggle, the market “topping”, or….none of the above.
Bulls would hope at market opening for a downside of no lower than 1076 on the SPX, and a rebound to 10, 640 area.
Bears believe it is time to short the market
The USD is gaining. This signals that the Federal Reserve may be closer to tightening monetary policy gave the dollar a renewed boost.
Add to this that U.S. economic data continues to outperform and real interest rates are shooting higher than Europe.
Now it is the Euro that shows levels of concern.
What you’ve read above is our real gauge on the market. To Floyd, unemployment at 10% is a natural reaction to the severe recession we’ve had and that our import ratios remain our own doing.
And, no matter what the government intervention, or any secondary stimulus, I believe we are going to see much more of a different nation and unemployment remains high, and inflation begins. This will happen.
Sadly, as an older man, I have never seen in my lifetime how deep and bloody the bi-partisanship has run, and the games that have become the lifeblood that simply do not want Obama in office.
Although I do not believe the GOP that organized, the conspiracist in me knows the Skull and Bones boys are behind this, and that less than 12 super rich men in the world try, and often succeed, to run the world. They want a central bank, a centralized currency, the control over work, and thusly income, and will be the first to call others socialists.
The market has begun declining from its 50 day moving average and as it declines each stopping point becomes areas of resistance. Watch the length of any 50-day moving average decline. We want both the average to increase, and the index we are tracking to also increase.
I believe that within each major country there will be severe currency crisis within the next five years, and that it is most likely to begin with the U.S. Dollar.
U.S. Treasury and agency debt makes up about 60% of the world’s banking reserves; our current U.S yearly borrowing requirements are around 2 trillion a year.
If China stops buying, if Japan moves away, there is no doubt that commodities (that of real value) will soar, and each long term portfolio requirement, from age 1 to 100, is to have a minimum of 10% in commodities (Gold, Silver, Coal, Oil, Natural Gas, etc) and pay no attention to current valuations, buying on any dips.
At the same time we have given a number of stock and option recommendations over the past few weeks and remain short term bullish, but only on sectors or blue chips that have healthy exposure to growth, and pay dividends.
Not much looks right with WAG Walgreens as you look at charts, but a lot is right. Barron’s recently covered them with the Duane Reedy chain purchase Walgreen plans even while on credit watch.
Walgreens controls 19% of the U.S. Prescription Drug market and is working on more electronic means in working with payors. I like the due diligence I’ve done on this down in the dumps value stock.
There are three ways to buy it.
1. Classic Pnf-At key support lines see if WAG holds, and buy as it is starting to move up by two traditional 3:1 boxes
2. Value Buying: Hold until the market hits any bottom near 10,000, or the stock takes a particular beating
3. Begin buying and continue to buy on any dip
With each of these methods one sets two things:
1. A stop loss. This can be a 25% trailing stop loss for the upside, and should be a support line on PNF chart that you are willing to risk to. This can be “tight” or “stretched stop loss. Using the charts below a tight stop loss would be 29.00. One would still have the 25% trailing stop loss
2. A second type of stop loss would be by % (10, 15, 20, etc) that you lock in with your broker.
