I have been twittering as jkings1. please follow me for up to the minute comments on the markets.
I've more than doubled my options portfolio over the past few weeks. The volatility has created a variety of opportunities recently.
Based on my study of $GLD options open interest, gold leasing rates and demand, we re at a new $1400+ plateau for gold. I see another move that will take us close to $1500 before long. Silver should hit $50 during summer. Metals will only stop if there is a sweeping dollar rally and massive peace around the world. Yes, metals are subject to pullbacks and can and shall do that, but the mega uptrend continues. This has been the on going pattern for a decade. Nothing goes up in a straight line except perhaps Netflix (one of my winning options trades this week). lol.
Overall stock market direction will be biased higher, though as I pointed out a few messages ago, the range would be fairly tight. Then the Japanese earthquake came along and threw a monkey wrench into the works,. I still see a little upward bias, perhaps a few more good rallies to go, but the air continues to get thicker - everything from Fukushima to Portugal and Libya.. I don't think people are fully grasping the impact of the Japanese quake and what it will do to world GDP later in the year.
The weirdest story to date on the Fukushima situation has been about the pink nuetron beams being emitted by the stricken nuclear complex. This situation is still playing out. Pray they really get things under control there soon.
Best,
JimK
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©2011by The Kingsland Report.
Thursday, March 24, 2011
Tuesday, March 15, 2011
Buckle Up
In a bizarre twist of fate, I bought SPY puts yesterday, not to profit off of the Japan tragedy, but to hedge some long positions. Since some new subscribers are on board, SPY puts go up when the market goes down. At this time S&P futures are down a whopping 28 points. It's been a couple of years since we've seen this type of action.
My favorite longs, both gold and silver, are taking a beating. Yes they are safe haven plays, but in times of market liquidation, gold and silver will drop as hedges dump to make up for stock portfolio losses. When people need money they also sell everything in sight (for now).
Not even QE happy Wall Street can withstand the overnight 16% drubbing of the broad TOPIX index in Japan. I watched the Tokyo Electric Power (TEPCO) news conference live last night on NHK TV via web stream. It's interesting that Japanese utilities can be quite evasive with the press just as any utility would be here in the US. The Japanese Press Corp was quite demanding. It was refeshing to see reporters demanding answers (no softball questions). But the problem was that TEPCO gave no answers, so NHK cut away half way through saying they weren't getting any new information. Even the Jpanese Prime is in dark wondering aloung. "what the hell is going on".
Conventiional wisdom would say that a dead cat bounce is ahead. and perhaps that might happen in Japan tonight, but the Tokyo market will be under significan pressure until signs point to the nuclear disaster taking a turn for the better. As of this morning, reactor #4 is now at a boiling point and major troubles persist at reactors 1,2 and 3.
If you are good with a minute chart and know how to look at classic RSI today is a good day to play the extremes that we will see in RSI.
You can bet that names in the Uranium sector are going to get hit like Cameco.
Multinationals that do lots of business in Japan will get slammed, like GE, Aflac.
Nuclear Industry names like Babcock and Wilcox will get clobbered.
Not every stock will fall on Wall Street. The solar group is looking strong this morning. We could see some action in exchange group with names like NYX and CBOE catching bids on consolidation rumors.
Remember the adage: You're only as good as your information. I had a bad feeling about the market yesterday and dumped my Apple shares after it failed to rally on news that IPOD2 sales beat estimates by a mile. All day Jim Cramer said the media was overstating the Tokyo nuclear problem which made me all the more uneasy. What does Jim Cramer really know? Granted, I saw him often make a nice salad at the CNBC cafeteria salad bar, but what does he know about nuke energy??? Cameco was also complicit with its conference call statements that it saw no major effect ahead for its business. what?? News radio had too many know it all guests saying that this wouldn't Chernobyl level stuff, etc.
Continue to watch the middle East. Bahrain CDS is widening where they have declared martial law.. Ghadaffi is still running around..
FYI here are the NYSE circuit breakers... http://www.nyse.com/press/circuit_breakers.html
These opinions are today. Lert's hope there is better news tomorrow.
My favorite longs, both gold and silver, are taking a beating. Yes they are safe haven plays, but in times of market liquidation, gold and silver will drop as hedges dump to make up for stock portfolio losses. When people need money they also sell everything in sight (for now).
Not even QE happy Wall Street can withstand the overnight 16% drubbing of the broad TOPIX index in Japan. I watched the Tokyo Electric Power (TEPCO) news conference live last night on NHK TV via web stream. It's interesting that Japanese utilities can be quite evasive with the press just as any utility would be here in the US. The Japanese Press Corp was quite demanding. It was refeshing to see reporters demanding answers (no softball questions). But the problem was that TEPCO gave no answers, so NHK cut away half way through saying they weren't getting any new information. Even the Jpanese Prime is in dark wondering aloung. "what the hell is going on".
Conventiional wisdom would say that a dead cat bounce is ahead. and perhaps that might happen in Japan tonight, but the Tokyo market will be under significan pressure until signs point to the nuclear disaster taking a turn for the better. As of this morning, reactor #4 is now at a boiling point and major troubles persist at reactors 1,2 and 3.
If you are good with a minute chart and know how to look at classic RSI today is a good day to play the extremes that we will see in RSI.
You can bet that names in the Uranium sector are going to get hit like Cameco.
Multinationals that do lots of business in Japan will get slammed, like GE, Aflac.
Nuclear Industry names like Babcock and Wilcox will get clobbered.
Not every stock will fall on Wall Street. The solar group is looking strong this morning. We could see some action in exchange group with names like NYX and CBOE catching bids on consolidation rumors.
Remember the adage: You're only as good as your information. I had a bad feeling about the market yesterday and dumped my Apple shares after it failed to rally on news that IPOD2 sales beat estimates by a mile. All day Jim Cramer said the media was overstating the Tokyo nuclear problem which made me all the more uneasy. What does Jim Cramer really know? Granted, I saw him often make a nice salad at the CNBC cafeteria salad bar, but what does he know about nuke energy??? Cameco was also complicit with its conference call statements that it saw no major effect ahead for its business. what?? News radio had too many know it all guests saying that this wouldn't Chernobyl level stuff, etc.
Continue to watch the middle East. Bahrain CDS is widening where they have declared martial law.. Ghadaffi is still running around..
FYI here are the NYSE circuit breakers... http://www.nyse.com/press/circuit_breakers.html
These opinions are today. Lert's hope there is better news tomorrow.
Sunday, March 6, 2011
CBS Sunday Morning Highlights Gold
Could the mainstream media be waking up? Gold was talked about as an asset and hedge on CBS Sunday morning. Imagine that: http://www.cbsnews.com/stories/2011/03/06/sunday/main20039768.shtml
Being generous with the estimates, gold is held by less than 1% of investment portfolios. Yes, gold is a vastly under-owned asset. This CBS treatment isn't a sign of a top imho, but a tacit of admission that perhaps the relegation of gold to the trash heap for all these year has been a mistake. We can only hope that some editorial authority in these traditional news organizations might be getting a clue that perhaps the constant plugging of paper products by the banking and brokerage cartels has been what one would call a BIG LIE, or put in a nicer way: IMPRUDENT. lol.
Being generous with the estimates, gold is held by less than 1% of investment portfolios. Yes, gold is a vastly under-owned asset. This CBS treatment isn't a sign of a top imho, but a tacit of admission that perhaps the relegation of gold to the trash heap for all these year has been a mistake. We can only hope that some editorial authority in these traditional news organizations might be getting a clue that perhaps the constant plugging of paper products by the banking and brokerage cartels has been what one would call a BIG LIE, or put in a nicer way: IMPRUDENT. lol.
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