The VIX seemed to be on its way for a nice run above the 20 dma mid last week as it vaulted and confirmed the move on Tuesday. But a slide Wednesday thru Friday put it right back to its lower resistance line of 28. A break of this line would appear to tell us the market is stabalizing or going higher, not lower.
It is very difficult to determine the direction of this market right now so caution has to be taken. I continue to stay away from U.S. securities. I like emergining markets very much and I really like Nat Gas via UNG for a longer term play.
TBT seems like a nice buying opportunity here. There is plenty of support at the 51-52 level so downward risk is very low and upward potential is very good.
KRE has a pretty clear bearish looking chart. I am playing it short but with stops at 21. If it were to hit that number, the 20 dma may re-cross the 50 dma and i don't want to play that game. But I suspect KRE is a pretty good short here but maybe stabalize in the short term. 3 months it should see 15 or lower.
If you want to believe the hype of the smart phones, go right ahead. I really wanted to short RIMM last week due to its incredible run creating a bubble. But I just did not have the guts since it is a risky play to get in the way of a runaway train. I think RIMM and APPL are both headed for a correction. Apple wants you to believe there is a mad rush for the 3Gs and there is good sales, but it is not in the order of magnitude that the stock price would indicate. I went to an AT&T store today about upgrading one of our phones. I asked about the iPhone sales and they said they are good but it is not nearly as powerful as the intro of the 3G. Just one data point but I have heard the same about other stores.
Watch the dollar. The dollar and energy will drive this market one way or the other. I believe a weeker dollar will be good for TBT and UNG and perhaps not so good for the market.
Happy Fathers day and good luck in this very difficult market.
Subscribe to:
Post Comments (Atom)
should i bale on ung
ReplyDeletewhitemule, if you are scared you should bail. If you are not confortable with any of your holdings you should not hold it. For me, today is a buying opportunity. I am looking at UNG for a longer term strategy. Playing UNG as a trade is difficult at best.
ReplyDeletebs, do you like it on technicals or fundamentals
ReplyDeletebs, have you noticed the low volume on ung the past 3-4 days. i see this as positive, no?
ReplyDeletei like it on pure technicals based on chart action in relation to support levels and how it is behaving with higher highs and higher lows. Plus it has lagged behind Oil for far too long. Clean energy is the rage and all it would take is one politian (especially obama) or a major industrial company to proclaim nat gas as the energy of the future for it to really explode. Also, end of summer surge in nat gas prices will be coming up soon. .
ReplyDeleteisn't it lower highs hence the wedging?
ReplyDeletebs, today looked like a hammer to me, what do you think
ReplyDeleteadwords, it depends on your time frame. Since late april, the lows are lower and yes we have a sideways wedge coming off of a gradual decline. I am betting the breakout is to the upside of the wedge and we will know any day now. I do not look at hourly chart to determine intraday patterns.
ReplyDeleteBS, sorry to be a pain but i'm guessing you see ung as a buy opportunity right now?
ReplyDeleteIf I did not already have a position in UNG, yes I would be buying. I am not worried at all at the current action. I wish it would just go straight up but things don't work like that. My options expire in October so plenty of time for it to make its gradual move up. Technically it is still solid here.
ReplyDelete