Round The World Stocks

I’m making this as an ‘infrastructure’ posting of live charts, but there will be some comments about how it looks “today” after it.

The idea is to show specific ETF (Exchange Traded Funds) tickers for individual countries or regions, each on a chart by itself. In that way, the indicators for each ticker can be seen in one scan of the page. Selected benchmark tickers will be on each graph.

We will start with North America, then Europe, Asia, then Australia / Latin America. Why that order? It is roughly the order of markets interest on my part…

All the charts here are from Bigcharts.com and you are encouraged to go there and practice making and using your own charts. It is an important skill and you can also then ‘run a chart’ whenever you want, and without depending on me…

North America:

S&P 500 Benchmark vs Other US Mkts

SPY vs TLT vs QQQQ RSI MACD DMI

SPY vs TLT vs QQQQ RSI MACD DMI

Clearly bonds have rolled over and money is running into stocks. QQQQ the Nasdaq 100 is not keeping up. Something is wrong in tech land and with Apple (that makes up a large part of QQQQ).

We use SPY as the benchmark as it is hard to beat most of the time. TLT are long duration bonds, so show when money is scared (rising) or The Fed is making bonds a waste of time (falling). Holding 1/2 bonds and 1/2 SPY is a good basic hedge position to start from as they often move in opposition. QQQQ Nasdaq 100 is both a Tech indicator and a market enthusiasm indicator. It is heavily influenced by AAPL Apple Computer.

RSI is presently “near 80″ and MACD has gone ‘flat sideways’. ADX is high (above 30) so a strong trend and saying to use MACD. DMI+ blue line is ‘on top’ so a positive trend in progress. This says an ongoing bull market run, but a potential for a ‘correction’ soon as RSI doesn’t hang out near 80 for long. That price has been well above the SMA stack for a while also is worrying. PSAR Parabolic Stop and Reversal (the red dots) have almost caught up to price. A stop loss order ought to be placed near that point now, if not just selling out. (At least, that’s what the indicator says to do).

Next we look at volume for the same ticker.

SPY vs DIA RUT  Vol+ Vix fast Momentum

SPY vs DIA RUT Vol+ Vix fast Momentum

Price continues to hug the top Bollinger Band (those outside red lines) and has not yet pulled away, so not YET a top. RUT the Russel 2000 small stocks is keeping pace with SPY, so that QQQQ problem is likely directly tied to AAPL or tech in particular, not a broad small market effect at all. DIA are the 30 Big Capitalization stocks in the Dow 30 “Industrials” (that are no longer really industrials havig things like banks in there). They are a bit behind SPY but about the same slope as RUT and SPY. This is a broad move.

At the far right edge, the “price bars” are getting very compressed. Not good. Not good at all. Price ranges are wide at bottoms (buy points) and very narrow / short at tops. Now look at volume. On the last few “up” days, volume has dried up and died. Buying is just not there to the upside. Very worry inducing. Maybe it is just things slowing down for the POTUS / TOTUS to give his speech. Tomorrow will tell. If volume spikes back to normal, that was it. If not…

Volatility is also ‘way low’. Also “very bad”. But means that it is cheap to buy puts to protect positions. Time to put some puts behind any gains or just ‘step aside’. ( I usually put in a close ‘stop loss order’ and raise it day by day, letting the market decide when to sell me out. Sometimes I’ll just sell. Occasionally I use puts.)

Momentum is still positive, but looks like a tiny ‘go flat’ at the end.

Now we do have The Fed trying to inflate a bubble like crazy, so “Don’t fight The Fed” applies. Yet we are also headed into a budget “sequestration ‘food fight'” real soon now. In those cross currents I’d take at least 1/2 off the table and protect the rest with stops or puts.

Nasdaq 100 QQQQ

How about a close up look at that QQQQ ticker?

QQQQ RSI MACD DMI

QQQQ RSI MACD DMI

Start at the bottom with ADX. It is ‘below 25′. Way below at about 7. That says “dead trend” fast trades on Slow Stochastic or similar only. But looking at the line ‘lately’, there isn’t really enough ‘ripple’ there to make trades worth it. Avoid Nasdaq for a while… PSAR is closing in on the price line as well. RSI has ‘gone flat’ near the middle and MACD is positive, but not by much, and likely to go to near zero if the trend says flat. Just no ‘there there’ right now.

QQQQ Vol+ Vfast Momentum

QQQQ Vol+ Vfast Momentum

Prices pulled away from the top Bollinger Band and the ‘range’ between the two has narrowed. Again, not good. The SMA stack is starting to ‘weave’ with price and at the very far right, on slightly up prices, volume has just died. Volatility is low. Momentum has left the building too. No reason to be in Nasdaq 100 right now…

Canada – Resource stock heavy

This one surprised me. I expected Canada to be doing better, what with the strong Looney and oil and all. Here it is less than the SPY and about an Emerging Market match, but in a ‘go flat’.

EWC Canada SPY EEM Emerging Mkts RSI MACD DMI

EWC Canada SPY EEM Emerging Mkts RSI MACD DMI

After the RSI 80 touch 5 months back, it is just ‘wedging in’ to flat. PSAR making those little ‘lids’ it makes over price when a ticker is ‘chopping sideways’. ADX is about 15 and falling. Dead money or fast Slow Stochastic swing trades only. MACD is above zero, but not much, and trending toward zero. DMI -/+ are about to weave.

Time to be out of Canada it would seem.

Mexico – 1/2 Emerging, 1/2 USA leverage, part resources

Interesting that Mexico has been out performing the USA. Stronger currency too. Sad that…

It looks to me like presently entering a small ‘correction’ so likely a buy opportunity ‘soon’.

EWW Mexico SPY EEM Emerging Mkts  RSI MACD DMI

EWW Mexico SPY EEM Emerging Mkts RSI MACD DMI

RSI is ‘near 80′ so a downturn ‘soon’ (that looks to be started). Tickers in steady runs up will have RSI range from 50 to 80. Those that are rolling over will drop to lower levels. MACD is a nice strong 1 (whole digits) but is ‘red on top’ right now, so ‘correction’ in progress (or rollover… time will tell). Watch for a crossover to blue on top or put a trailing ‘buy if touched’ order on it. ADX at 30 says use MACD and trend is strong, but it has inflected downward so is a bit of a worry. DMI has red /blue weaving. So either a reversal of trend or a ‘buy the dip’.

All in all, worth watching Mexico and expect it to be a ‘buy the dip’. But be a ‘reluctant buyer’…

EU / UK / Europe

The UK vs EU vs USA

The UK is in a nice trend (in $US) but not beating the alternative benchmarks. Not much reason to ‘go there’.

Here we use EZU the EU Composite ETF in addition to SPY as a benchmark. If SPY is beating, the USA is the place to be, if EZU is beating any given ticker, there is a ‘hotter ticker’ in another part of the EU.

EZU had more of a swoon a while back, but a stronger rise out of it. Now it has a hook down at the end, so ‘correcting’. Likely some of those divergences have to do with all three currencies moving this last year.

EWU vs EZU (EU Fund) vs SPY  RSI MACD DMI

EWU vs EZU (EU Fund) vs SPY RSI MACD DMI

PSAR being “choppy” with dashes of dots above and below price. Sideways rolling swing trades then. ADX confirms that with 20 and dropping saying trend is leaving. Red / Blue DMI +/- ‘weaving’ says the same. MACD hardly positive at all and trending to zero. RSI just “laying there” on 50 uninteresting. Walk away. Just walk away…

Germany, Core of Industrial Europe

Had a nice run. Clearly a major part of the EU Composite fund. Euro trending up will be starting to hurt exports and profits, though.

EWG Germany vs EZU EU composite vs USA SPY  RSI MACD DMI

EWG Germany vs EZU EU composite vs USA SPY RSI MACD DMI

RSI was ‘near 80′ a month ago and now had a ‘lower high’. That usually means “Last call to bail out”. PSAR called an exit (when price touched the red dots below price) and has swapped to a “Don’t buy until through this line” lid on top. MACD red on top, inflected downward. Correction under way. ADX at 25 says “use MACD” trend is strong enough, but it is headed down too. DMI has gone ‘red on top’, so ‘be out’.

No reason to stay in Germany right now, though a potential ‘buy the dip’. Watch for buy indications before doing so, though.

France, The other Point Of View in the EU

Substantially the same indications as Germany. A bit stronger DMI- reading. Price clearly “dipping”. I’d shift to a 10 day hourly chart and day trade in on a ‘dip reversal’ and then stay in if a trailing stop loss or the ‘day trade chart’ didn’t take me out and the prior trend resumes. I’d not buy in longer term and hold without a confirmation on this chart of trend up resuming.

EWQ France vs EZU EU fund vs USA SPY RSI MACD DMI

EWQ France vs EZU EU fund vs USA SPY RSI MACD DMI

A Bit of Asia

China

After a bit swoon, a quick recovery. But with big dips. Choppy. (Nice for trading though, gives good indicates on the indicators that way.) Asia ex-Japan is beating it though. (Australia is part of that ticker, so check out the Australians…)

FXI China EPP Asia ex-Japan EWJ Japan SPY RSI MACD DMI

FXI China EPP Asia ex-Japan EWJ Japan SPY RSI MACD DMI

RSI touched 80, and price rolled down. Other times, a month later, it ran back up. This time it legged down more. A sign of weakness. MACD is clearly ‘red on top’ and headed below zero. DMI- (red) is on top too. Both say “stay out”. ADX at ’20 something’ is a bit vague. I’d trade this ticker on a faster chart (10 day hourly) or use slow stochastic crossovers, but not buy for longer term. It looks ‘toppy’ to me with prices stalled to the upside for the last month, then a breakdown. I’d mostly avoid it.

Japan

Bank of Japan announced “bugger the currency” and their market took off. Not sure that’s a great way to increase wealth creation, though. Still, it is a fairly new run in a very well established market. “Don’t fight The Fed” also translates to “Don’t fight the BOJ”. EWY South Korea was beating it nicely, then North Korea blew up a new nuke, and it looks to be taking a hard down. EPP looks better, though. Still, as a small position, tossing a bit at BOJ and their currency blow job might be worth it.

EWJ Japan vs EWY S.Korea EPP Asia ex-Japan SPY RSI MACD DMI

EWJ Japan vs EWY S.Korea EPP Asia ex-Japan SPY RSI MACD DMI

RSI looks to be doing the 50 – 80 oscillation of a young run. MACD is positive and blue on top, with inflections matching buy / sell points in the past. ADX is only 20, so a weak trend, but rising. DMI has blue on top. Looks like it has legs, if only strolling and not sprinting…

Update: I’ve added fxy the Yen to the chart. News flow has Soros making another $Billion out of a “short yet long Japanese stocks” position.

India

There are two India tickers on here. EPI has higher volume and a dividend screen. IIF is lower volume, but more price rise. The average o the two is about EEM equivalent, so no great shakes, and clearly it’s a ‘stock pickers market’ as the two funds have very different performance.

I lost interest in India a year or two back when their Fiance Minister announced some capital controls. One of my rules. My money, my control. You want to lock me in, I leave as fast as possible and don’t look back.

IIF M.S. India Fund vs EPI Wisdom Tree India Div. Fund vs EEM Emerging Mkts vs SPY RSI MACD DMI

IIF M.S. India Fund vs EPI Wisdom Tree India Div. Fund vs EEM Emerging Mkts vs SPY RSI MACD DMI

We’ve got RSI with ‘lower highs’, but in a thin ticker it can be less accurate. ADX is down near 10 and has DMI red on top. Not interesting. MACD red on top at zero. Very not interesting. PSAR has gone to ‘lid on top’ be out. Just not really interested.

Oceana / Australia

The EPP Asia ex-Japan has some Australia in it. I’d expect to see good things here based on that.

Australia

EWA Australia, EPP Asia Ex-Japan, EWJ Japan SPY RSI MACD DMI

EWA Australia, EPP Asia Ex-Japan, EWJ Japan SPY RSI MACD DMI

Clearly EPP moves strongly with Australia and Australia has been doing very well (in $US as their currency is holding value and ours is not…)

PSAR catching up to price, so likely a ‘dip soon’ that would be a buy point. Beating Japan, and with a better slope than SPY. Only question is how much more it can run. (Or is that how weak can the $US get?…) RSI doing a ‘slighly below 50 to near 75′ roll from the looks of it. MACD positive and smooth sideways. ADX above 25 at near 30 says use MACD and trend strong. DMI “blue on top” and all systems go.

Looks like Australia ‘has action’ and is a decent place to play for a while.

How about their little brother?

New Zealand

Well. The likely Kiwi That Could!

ENZL New Zealand vs EWJ Japan EPP Asia ex-Japan, SPY  RSI MACD DMI

ENZL New Zealand vs EWJ Japan EPP Asia ex-Japan, SPY RSI MACD DMI

OK, late to the party, but what a party. RSI looks to be settled in as a rolling range. ADX is 20 and dropping, so maybe ending the run (or dipping). DMI has a red-blue weave, so trying to pick a trend. MACD is positive but with “red on top” of modest down slope. Saying not yet time to be in. PSAR has stopped out and put the lid on. Saying wait until these dots are touched to buy back in.

All in all, it’s a bit late in the run to buy, but I’d move to a faster chart and ‘trade in’ on the chance of a ‘buy the dip’ moment; but be ready to exit if it is just a failed top. If the trend resumes, then let it ride.

South America

Brazil

Brazil was great for a decade or two. They had a socialist president who didn’t want to muck with their economic miracle, so didn’t interfere with markets. Then in the last? election the new guy had a large ‘dick with factor’ and started socializing the markets more. It’s been down or dead money since. I mostly watch it now just to see if it ever hits bottom…

EWZ Brazil vs ILF Latin 40 large vs EEM Emerging Mkt  SPY RSI MACD DMI

EWZ Brazil vs ILF Latin 40 large vs EEM Emerging Mkt SPY RSI MACD DMI

Looks to me like we had a crash (bang tinkle ;-) then a Dead Cat Bounce. Now it’s tried a run up and that’s failing. Prices rolled over again after ‘not much’. RSI touched 80 anyway, then had ‘lower highs’. MACD red on top at zero. Yawn. ADX 15 and dropping with weaving DMI. Nothing to see, move along, move along…

Chile

Lots of mining leveraged to China and economic activity globally. Underperforming the “Latin Majors” fund, but with a nice new rise lately. Largely a bet on economic growth taking off in the world.

CH Chile ILF Latin 40 large EEM Emerging Mkt SPY RSI MACD DMI

CH Chile ILF Latin 40 large EEM Emerging Mkt SPY RSI MACD DMI

RSI off a buy / bottom, but not yet ‘near 80′. That’s good. ADX a bit weak at 15, so ought to use Slow Stochastic or a faster chart and swing trade (or perhaps just early in the trend formation). DMI blue on top with MACD sideways a bit above the zero line.

Looks a lot like a new positive run in the very early stages. Could use some confirming investigation, but generally looks good. Especially with Australia going gang busters, the resources demand ought to reflect in Chile too. So “interesting” for a small position or look inside the fund at particular stocks for more guidance / ideas.

In Conclusion

It looks like some of the Latin countries have some action, also ANZUS and Japan. With the currency buggery, I’d likely look to the Latins more. Australia needs a ‘Canadian Moment’ to toss out their Global Warming Green Goofballs or their economy might be hobbled, even with large Chinese demand. Still, it looks like the ‘big issues’ are coming from the USA (“sequestration”) and North Korea (Japan and S. Korea at risk, China likely to be part of the ‘food fight’). So things ‘away from them’ and not playing ‘bugger the currency’ are Australia, New Zealand, Chile and some other selected Latins. So that’s where I’m likely to play / focus.

The EU and UK are doing OK, but I don’t see how they can do a return to a strong Euro and “make it” while driving costs for power higher internally too. Clearly we have ‘asset inflation’ from multiple central banks doing “bugger the currencies” and that “strong Euro” is by being measured against a rubber dollar…

So all in all, it looks like the ‘out of the way’ corners are likely the best places to be. Which means more detailed searching. Oh well… But there were a few trade opportunities turned up. Right now, I need to do a currency ‘race’ and move some of my dollars to other currencies, while picking up more ‘tangibles’. I’m not holding gold (as it is Central Bank dominated) but rather precious metals used in industry. They have increasing demand, limited supply, and less ‘fooling around with’ by governments. PPLT Platinum, PALL Palladium, JJC Copper, JJT Tin. While gold and sliver are trending downward with financial guys leaving for stocks, the more industrial metals have rounded up and are looking good…

Selected Metals – PALL Palladium, PPLT Platinum, JJC Copper, JJT Tin, GLD Gold, SLV Silver

So it looks to me like a time to be buying things that are needed by industry and away from currency buggery and “Financial Games”.

To look at more ‘variety tickers’ in the EU, or other geographies, hit this link:

https://chiefio.wordpress.com/2011/12/15/global-stocks-survey/

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About E.M.Smith

A technical managerial sort interested in things from Stonehenge to computer science. My present "hot buttons' are the mythology of Climate Change and ancient metrology; but things change...
This entry was posted in Economics, Trading, and Money, Stock Charts and tagged , , . Bookmark the permalink.

25 Responses to Round The World Stocks

  1. DirkH says:

    As I said my seasonal model chased me out of stocks, last sold on Feb 08, and put all into Gold, 2 % down for now for me. EURO stays surprisingly strong.

    I don’t think the Euro’s strength will last,though. France is acutely imploding, Germany contracted in the last quarter.

    The warning signs you see for stocks in Germany and US are what my seasonal strategy anticipates. It tries to get out way before the trouble starts. Avoid dangerous parts of the season entirely.

  2. PhilJourdan says:

    Basically, the US is still the elephant in the room. I see a lot of hope for Australia dumping the greens this fall. So I guess that may be the last vestige of hope. But Japan is too thin to believe it will last or amount to much. China is going to keep pegging to the dollar so they will mirror it. Europe is just going deeper into problems, that shortly Germany will no longer be able to paper over.

    Not good. I think Dirk has the long term outlook.

  3. adolfogiurfa says:

    Printing money, making fiat money will never replace production it rather discourages it, the real backbone of economy is the production of goods. The world, really the first world and some economies of the third world, like Argentina and others, are committing suicide. The biblical flood has been replaced by a currency flood with almost same consequences and this time there is not any Noah around…

  4. E.M.Smith says:

    @DirkH:

    Compare Platinum to Gold. Gold has a large influence from hedge funds, gold funds, hype, and central banks. Lots of folks trying to get out of gold (as they think the ‘risk’ is abating) and into stocks (as they think it is a ‘risk on’ world) so Gold is drifting down. At the same time, expectations of growth of sales of things like cars has manufacturing demand for platinum on the rise. So “long platinum short gold” ought to be the best strategy for a hedge fund in metals.

    Holding gold is fighting that narrative and those social pressures. (Note that it doesn’t matter if the economy is unlikely to actually do that recovery. All that matters is that the bulk of the Money Folks believe it and are taking those positions… It takes a very long time for reality to overcome belief, so it’s appropriate to be ready to make the move to the more correct reality position; but not before the crowed has finished running the wrong way…. only at the turn. That is the major advantage of the chart method I use. It reminds me that “The Story” matters to them and that I need to wait for actual price movements to show they are changing Their Story…. “There is always a Story. -E.M.Smith” and you need to not fight the strong Stories while being ready to catch the turn when if fails…

    @PhilJourdan:

    But “short term” can be up to 364 days… (“Long Term” is defined as a year or over…)

    If you are “long gold” while it drops for 6 months, well… I’d rather wait in something going up and then catch that turn with a chart than to sit in a “Story” that’s dropping for 6 months, then wait another 4 to 6 months to recover my starting point. Yes, if you just want to ‘preserve value’ it is a find strategy for ‘hiding out’ for a year, but I’m a more active trader oriented person than that.

    So as long as the Big Money is flowing into something, stay in it. Try to leave just before the turn (but it can come much later than you expect…) but mostly let the chart tell you when the turn is happening. Most of the folks and a lot of the money only notice the turn LONG after it is starkly clear in the graphs, so you still get out way before most of them; and get to stay in the ‘longer than expected trends’ too.

    Took me many many years to learn to trust what the charts were saying about the center of mass of the folks (and their money) and set aside my own “Stories” until “the right time” was indicated.

    At any rate, the volume bars are down again today (so far) so looking like the POTUS/TOTUS has not talked up the volume and the “folks” were not just waiting to see what he would say.

    USA likely to “take a dip” in size “soon”. Probably when the Sequester looks like it’s going to hit.

    Germany / EU: Don’t know when their next ‘aw shit’ moment comes, or over what. When does Greece / Spain next need money? ;-)

    Japan doesn’t need to go for a long time to make money out of the trade. Nor Australia. Though frankly I find the Kiwi move more interesting…. It also implies that “looking around” for other odd corners that are not playing the “bugger the currency” game could be of benefit. So Russia, various Latin countries (but not Venezuela that just did a currency devaluation nor Argentina that’s a basket case), “Emerging Eastern Europe” not in the EU, bits of Asia ( Indonesia, Malaysia) maybe even S. Africa.

    @Adolfo:

    Well put. Any suggestions on Latin countries that are NOT doing the “money print to ruin” game? I’ve got the Chile fund, but don’t know of many more ways to trade into other countries “down there”. There’s a couple of big banks (Banco Bradesco (sp?) and Itau IIRC) but any insight from someone ‘with eyes on the ground’ would be appreciated. (Like, for example, I have nearly no idea how Peru is doing nor what major funds / tickers might be traded outside the country. Yeah, I could do a ‘cold search’, but having some “names” makes it easier ;-)

  5. PhilJourdan says:

    @E.M. True. But I did mean long term in saying what Dirk was doing was long term. As of the end of this quarter, I am 80% out of American Stocks. I see no upside (minor fluctuations, but not a lot there to give it any real up side except QE4). I did not pull out after November 6 because there is an inertia (denial?) for people. But the 4th quarter growth number (not a surprise to me) basically told me that stocks in the short term (in the next year) are a loser. I think we have peaked.

    But I am no expert. Just a 57 year old gut telling me that (plus my Economic background).

    If it turns out to be an ulcer, I will let you know. ;-)

  6. E.M.Smith says:

    Golly, found a Peru fund already. EPU is the ticker. Beating S&P 500 and RUT along with ILF and CH too. Chart Here.

    What’s in it is here: http://us.ishares.com/product_info/fund/overview/EPU.htm

  7. E.M.Smith says:

    @Adolfo:

    Nice, very nice. Exactly what I wanted. Thanks!

    @PhilJourdan:

    One of THE most important things, and almost universally ignored / misunderstood, is “piking your time frame”. It must match the PERSON and what they want, feel, and do. So a nervous impatient high energy Alpha type needs a 10 day 15 minute or hourly chart and day trading time scales. A laid back don’t want to be bothered safety seeking person needs to be a long term investor and looking at hedge strategies (mix of bonds and stocks) along with 10 year weekly charts. In between, the ‘typical’ somewhat impatient person who doesn’t like taking losses for a year but can’t trade on a daily basis needs to use a 1 year daily chart, looked at at least once a week. (Which is why I use that chart for most postings, as it covers the middle ground well).

    But my nature is more ‘flexible’… so I shift charts with the patterns. Not for most folks. (Heck, not for almost everyone… most folks don’t have “flexible style and personality”… ) Which is why I don’t usually post on exactly what I’m doing as it would drive most folks around the bend. Buying JPM with TWO time frames at the same time? One ‘swing / day trade’ and one ‘trend trade” and neither an “investment”? Having industrial metals on a “swing trade” basis while seeing gold as “topped out” for a year+ and Bonds as a “Big Short” for years to come and selected countries as ‘day trade ETFs”? All at the same time… So I can’t expect “other folks” to have “my style” as it is eclectic and schtizo!

    Which is a very long way to say: DirkH isn’t wrong, just working a very different “time scale”… Measured in seasonal units, not days…
    And that I’m more impatient ;-)

    At any rate, I’m looking for the “next horse to ride” and mostly hiding out in things away from the money printers…

  8. DirkH says:

    I will hold the Gold for 8 months if my computer does not come up with new ideas. (I bought an ETF-like product but it is actually a right to delivery; an IOU, and physically covered. The Gold is not leased.)
    My expectation is that some crash will happen in the Eurozone; that stocks will correct 20 or 25% down and Gold will at the same time go up as people will frantically flee from the stock market.

    I am of course very eager to enable my genetic algorithms to come up with the smart moves ChiefIO descibes; but my attempts so far have been outperformed by the stupid seasonal correlation. From time to time I try to improve the strategy manually, but so far I failed to beat the stupid one.

    About “the story”: Don’t forget that China and Russia continue to accumulate Gold. They don’t care for the story in the West. They aim at replacing the USD as lead currency.

  9. PhilJourdan says:

    @E.M. Seems you found a new horse before you responded to me. Just for grins and giggles (as I am the more laid back type), I am going to follow the Peru fund to see how your mind works. ;-)

  10. E.M.Smith says:

    @DirkH:

    On your time scale ( almost a year ) it is likely that gold will go up (IMHO), but right now it is going down. So one of my “trade rules” is “Never catch a falling knife” but put a “buy if touched above it…” That way I have my position “bought in” if the target DOES go up, but I’m not at risk of being bought in too early. I don’t always do that, but it’s the “rule” ;-)

    As gold is in an established downtrend, my “trade rules” say it needs to go above the moving average stack and have MACD “blue on top” with the decent upward slope with ADX indicating decent trend strength ( i.e not saying to use Slow Stochastic for fast trades in a ‘weaving’ market) before I take a larger longer term position. (Not criticizing your method, just explaining mine, so if there is something in it of value you can check it out and / or incorporate it. Or not. ;-)

    BTW, it doesn’t matter if China and Russia are buying, only the net buy / sell ratio. So if Russia and China are buying 1/2 what is being dumped by massive hedge funds rushing into some New Idea, gold drops. When the Heggies run out of gold to sell, then the bottom rounds back up and that’s the ideal time to buy. Then “Russia is your friend” ;-) In essence, your method is similar ot “dollar cost averaging” and waiting for the bottom to arrive, while mine is more market timing based on technicals.

    Then again, I’m looking to time things down to days or at most a week… not seasons… Faster time scale…

    IMHO we have a SHTF moment as we approach March 1 and The Federal Government goes to blows again. Europe I have less grasp on schedules… But don’t see much there that is going the right direction. So I think we have an “enthusiasm bubble” and some easy money driven asset inflation bubble. But those can run for a while before breaking… So I put a lot of effort into “top detection methods” and I’m pretty good at it. The Germany chart looks a lot like a top… (But I really ought to do a volume and volatility compare too… unfortunately I’ve not found a place to get free charts with European tickers on it that includes volume and the US ETFs are not reflective of actual market volumes… only US ETF interest.)

    @PhilJourdan:

    Not found a ‘new one to ride’ yet. Need to do more analysis first. (Watch for a “Peru Posting” ;-)

    FWIW, I’ve kind of gone out of my way to explain how my system works in various postings… (As to how my “mind works”, some would dispute that is a valid question… ;-)

  11. PhilJourdan says:

    I have not read all your postings, but I do read most (I miss some when I am away). I do not want to try to duplicate your system for 2 reasons. One is I do not have the expertise (and am at least smart enough to acknowledge it) and 2 is I do not have the patience you have.

    But I do enjoy reading about what you are doing. And as I said, when something comes along that is not in the mainstream – to watch how it performs versus your analysis.

  12. DirkH says:

    No more money to earn by going long in German stocks, we agree.

  13. adolfogiurfa says:

    The real big thing looming in the future, as some predict, is the next “treasury bonds” bubble explosion. Any comments?

  14. E.M.Smith says:

    @Adolfo:

    Um, I said to be out of bonds in general and Treasuries in particular some weeks (months?) back. Since then they have inflected down. It will stay that way for, most likely, the next few years. So we will have a very long opportunity to “short Treasuries” for years to come. But it is a slow trade and subject to manipulation by The Fed and other governments and agencies…

  15. jim2 says:

    I’m too damn busy to ride stocks, so I sold just about all mine a few weeks ago.

  16. p.g.sharrow says:

    At present it appears that the Fed is attempting to inflate the dollar slightly faster then the euro inflates in a race to the bottom. The resultant minus return on present bonds. Gold and silver appear to me to be way too expensive due to defensive buying, But platinum, copper etc. seem to be relatively cheap. pg

  17. DirkH says:

    p.g.sharrow says:
    14 February 2013 at 3:24 am
    “At present it appears that the Fed is attempting to inflate the dollar slightly faster then the euro inflates in a race to the bottom. ”

    All the cash generated by Bernanke was snapped up by Euro banks operating in the US. The Fed tries to re capitalize Euro banks. They have a leverage of 26. Lehman had 30 before it went bust.

    Euro banks are mostly a cesspool of non performing loans. The Fed tries to prevent the implosion of the Euro banking system.

    They will take turns, when Bernanke has driven down the USD too far it will be Draghi’s turn to pump new Euros into the Euro banking system.

    I think German banks have managed to get rid of their bad debt; but most of the banks in PIGS + France are blue in the face.

    We are witnessing ongoing resuscitation attempts. See Monte Paschi, Italian bank, just got a bailout. Bankia’s collapse in Spain.

  18. adolfogiurfa says:

    @P.G. But platinum, copper etc. seem to be relatively cheap. pg J.P.Morgan has thought the same and has bought 20% of the current copper and has established offices here with that purpose.

  19. adolfogiurfa says:

    @DirkH: You are right, but “they” know it won´t work, knowing they are just kicking the can perhaps a few weeks more. Then…. “papers” won´t have any value. BUY CANNED BEANS!!….and, of course, MORE POPCORN!

  20. E.M.Smith says:

    @P.G. Sharrow:

    Bingo! The “industrial metals” move with physical demand, and that is growing from China, India, etc. Platinum is not subject to Central Bank games.

    @DirkH:

    One of the basic problems is that the Central Bankers think in terms of “Nation” (that is how all the course work is taught) but we now have a global integrated economy (NOT a great idea, IMHO). That means that most of the “easing” The Fed did showed up in China as inflation pressures (money peg) or Europe as “easy cash in the banks to mask ‘issues’ in reserves”; neither a good thing.

    I’m most worried about Italy and the Italian election at the moment. Some goofball party is showing well. (Any insight on that appreciated. Knowing the Italian parties and politics has not been high on my ‘interest list’ so I’m a bit useless at that analysis…) To an outsider it looks like a “Greece in the making” vote is possible… Spain not doing better either….

    @Adolfo:

    Good intelligence “on the ground”…

    Paper can have value for far longer than you might think. It is a contract, so the value depends on the honoring…

    But I’d be inclined to buy ‘contracts’ that will be honored somewhere else rather than beans…

    (The price of gas is low right now anyway ;-)

  21. DirkH says:

    Italy: Berlusconi is a billionaire, maybe corrupt, owner of a private TV network.

    Monti is an unelected EU technocrat installed by Brussels to keep Italy in line.

    A Berlusconi election would be one of protest against the EU and deliver a shock to the EUSSR system.

    That being said Berlusconi was prime minister for several terms and knows how to do the job.

    The bigger very real problem is the ongoing collapse of the French private sector and the wholesale de-industrialisation of France (Hollande’s rich tax; driving away millionaires, Peugeot’s and Renault’s sales collapse, bailouts for Peugeot.)

    56% of French workforce works for central government – this does not count the local governments.

    French industrial output is at the level of 1997 while German industrial output is twice the 97 level (or somesuch).

  22. adolfogiurfa says:

    @DirkH: O boy….and I don´t know russian…

  23. DirkH says:

    Adolfo: The EU’s institutions are mirror images of the USSR institutions, hence EUSSR. And like the USSR we have no democracy.

  24. adolfogiurfa says:

    @DirkH: You are right, I´m ok with my spanish….and E.M. with his “spanglish”

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