Stock Market August 2009

[pinetree]

Merv does have us as full bullish again, and we do need acouple more days for the 15 to cross over the 65 day with both pointing up.  Hopefully investment capital follows,  I think it will for what thats worth.   I am in and waiting!

Heh, these U's are starting to make me sweat a little.

Have started to feel tempted to take some profits now, though more due to impatience than anything else.  But am staying long and strong, my take on the charts is we're still in a holding pattern, awaiting the next break, which for now still looks to me like it will be up.  Weekly charts look great, dailies in consolidation... just have to keep waiting.

[sunseeker]

Re: PNP

”What a difference a day makes Twenty-four little hours”

Ah well it was hardly unexpected. I’m drawing great comfort from still being in profit, knowing that there are people in a higher level than myself, and that most recent NAV figure of 1.91 CAD. Combine that with the high quality management and the cost advantages of buying a one stop junior portfolio.

All in all still a happy bunny (but not quite as happy as yesterday).

Good night from your UK correspondent.

ATB 

[sidewinder]

What's a mother to love about these things?  All I can get is the Pink Sheet but think the US stuff follows pretty close to the Canadian.  For me trading off the Pink Sheet is a killer.  It is just not reliable enough for me.  In the beginning trading these juniors presented several problems.  One getting timely information and two the lack of volume.  Pintree has had a divergence on volume and price for over a month and BAM somebody gets in an trades the hell out of it 396,000 shares after averaging 60-70 thousand and runs the stock up.  You want to stay and enjoy a run but then the next day they take it down on 30% of the volume 136,000 shares. 

I don't know guys, these things are still just a lottery ticket to me.  Then you throw in the "Sheldon Factor", the guy may be a good manager but he is just to close to JD to put much credibility into as far as really having shareholder's best interest.  Wish I had 3-5 million laying around .... I would show you how to jerk a bunch people around and make some tokens in the process.  Nonetheless, I DO believe uraniums will have their day only question is when?  Just can't get too excited about a pump and dump anymore.

[pinetree]

Looks like a breakdown...

As SW pointed out recently, and I've noticed the same thing myself, many of these certain price/indicator relationships work very well for a while and then they fade away or stop working altogether.  The catch is that you don't know when they're going to fade away so risk mgmt must always be employed... they aren't sure things but it seems to me a lot of clues can be taken from them while they ARE working.  Still not sure how to incorporate this sort of thing into my trading, but I think there's value in it for bigger picture views as well as short term trading.  Look how many intraday bounces there have been off these lines since the first bounce back on June 23... very helpful for day trading if you've got other evidence to line it up with.

These fan lines aren't going to work forever but they've been working pretty damn well for the past 2 months so I'm going to assume they're still working until I see evidence that they're not.  I am thinking we're heading back down to retest the next line down and the 50sma, and they look as if they'll be converging at the same area by weeks end.

After today's action U's look to me like a failed new high, could be heading back to mid-summer levels and another retest of those Jan highs...

EDIT - neglected to mention that the recent tops in the Dow and S&P were exactly at the 38.2% retracement of the 10/07-3/09 down move, so a reasonable area to expect a pullback.

On the U's I said failed new high based on the weekly NLR  chart, which looks like a lower high was put in over the past two weeks with a breakdown today.  Though I may have spoken too soon... since this is a weekly chart I should wait for the week to finish before I declare this candle a breakdown off a FNH.  It is possible that we could have a reversal later this week.  Though if that doesn't happen odds would favor a retest of the early July low and the 150 level on Merv's index.

[sunseeker]

Just a little (UK quoted URU) wildcard that I’ll throw into the ring for you all to look into:

….."because my partner is the best uranium man in the world – which this has got the best uranium deposit, we’ve seen in the last 20 years."

http://www.moneyweek.com/news-and-charts/economics/will-inflation-make-a-comeback-later-this-year-14430.aspx

DYOR

http://www.niger-uranium.com/

They know that they have first class resource.  I believe that there will be a bidding war at some point. In the mean time they have to conserve their cash in the best way possible so that the company can realise the full potential of that resource. The risk is that they run out of cash and have to let it go at a bargain price (that won’t happen just as long as the U price doesn’t slip up).

ATB 

[sidewinder]

I guess the U.S. Pink sheet version of Niger Uranium NULTF has nothing or little to do with the stock traded in London URU.L.... would anyone know?   NULTF trades about 300 shares daily and recently was at .43 cents US.  Whereas, URL.L is at 31.25 GBP per share and traded a little over 240 thousand shared.

 Big difference or maybe our British cousins feel sorry for the hard time we Americans have been experiencing and out of the goodness of their little Limey hearts are deeply discounting this stock so we colonials might get to participate.   

[sunseeker]

Hi SW

I guess the U.S. Pink sheet version of Niger Uranium NULTF has nothing or little to do with the stock traded in London URU.L.... would anyone know?

That looks like a very good spot:

http://equiniti.is-teledata.com/datasheet/main.html?sSymbol=URU.ISE&sBackUrl=/news/page.html&company_id=1002696

It does seem that you can get a better deal on the Pinks.

The beauty of this site is the vast amount of knowledge and experience I can tap into and follow up on. It also has the added benefit of throwing up sites of interest through my searches.

Thanks

ATB 

[sunseeker]

Grandich goes bullish on uranium: 

http://grandich.agoracom.com/2009/08/further-support-for-grandich-bullish-on-uranium-via-agoracom/


ATB 

[pinetree]

Thanks for the info.

Jim Cramer did a piece on nuclear last night and had the Shaw Group CEO in the studio with him.  Nice to see this being brought to the attention of the masses.

On the U's I said failed new high based on the weekly NLR  chart, which looks like a lower high was put in over the past two weeks with a breakdown today.  Though I may have spoken too soon... since this is a weekly chart I should wait for the week to finish before I declare this candle a breakdown off a FNH.  It is possible that we could have a reversal later this week.

Looks like we got the reversal.

I didn't expect this on Monday but was starting to think it was more likely as the week went on.   

What's going on with Mega being up 15% today?  I held my nose and added to MGAFF Weds at 1.07 and it's now at 1.27!?  Nice to get an upside surprise out of one of these guys instead of the usual downside variety.

[jjj000]

Good stuff out there.  Didn't get the chance to trade at all last night... looks like I missed some nice opportunities.

BF- and it looks like you got the call this month.  New highs today for August definitely invalidate the options skew theory call.

That 990 top channel limit broke sending us to new highs as expected.  Good to know at least one of my theories still works 

This damn market sure doesn't want to go down...

[Bottomfeeder]

I was lucky to take some postions early 3j.....then its just hang in until the trend breaks.   

What led me in the right direction was the FASB MTM changes and all the politicing around policy, you could just see how it was kind of going to unfold with the inflation trade being back on.  The government needs Wall Street to be successful, in order to have a chance at retaining power, and the orchestration was pretty obvious.  Then it has just been play the trend.

It will go down again as nothing goes up forever, fortunately just don't have to be too antsy about it.  Hopefully, the U's will take off next week, as I have added quite a bit this year, and would like an opportunity to rebalance. 

Good job Pinetree on your addtion.  Todays Mega move was of the best variety I think, as their was no news, but volume on the TSX was double average volume.  I would personally like to welcome the speculators back to the sector.  Lets see if we can put together a week run, that would be nice.

[pinetree]

BF, you've definitely got a handle on how the fundamentals are moving the market... nice job on that.  I read that stuff but for some reason am rarely able to come up with any market predictions from it...

Anyway, speaking of the volume on Mega, I've been looking at weekly charts for these junior U's going back to 2004 and I really like what I see across this sector.  I've been comparing the volume on the previous bull market of 05-07 to the volume on the 2009 upleg.  For most stocks I've looked at the highest weekly volumes on the 2009 rally have been at least as high, if not higher, than the volume highs during the previous bull.  Two great examples are UEX (which I bought Thu for 0.99) and DNN which had their highest weekly volumes EVER on this years rally - even higher than the panic selling during the crash.  FWIW I am interpreting this as a sign that this rally is for real and that another upleg will come eventually *fingers crossed for Merv's target*...

Even on a daily chart I was looking at UEX and it was trading 4 to 6 million shares a day when it was running up in April and May.  Since then it's been trading on avg 600k a day as it's drifted lower with only one distribution day... and even over that time period the up days on balance appear to be on higher volume than the down days.

EDIT - Just looked at Mega and most of that action occured in a 1 hour window this afternoon so not sure what to make of that yet.  Will have to see if there's any follow-thru or similar activity in other stocks in the sector.  I don't want to assume it's more than it is at this point, it could be as simple as some guy with a few hundred grand to burn who just discovered Dines!

[Bottomfeeder]

PT...it is amazng how "right" I have been since March, and HOW LITTLE MONEY I HAVE MADE.

It is truly an amazing feet.   I guess this is where patience has to come into play, but still it is frustrating realizing that I could have been a complete lucky idiot improperly utilizing an instrument like FAS on a 6 MONTH HOLD with all the erosion and everything and be sitting on a 7 bagger today. .

Anyway I guess I have no choice but to stick with what I believe in and wait.  Pretty interesting volume info you put out there.  As far as Mega goes, they have had a couple analysts come out in the past couple weeks putting them as a strong buy/overweight so maybe thats it.  I also have heard a few analysts/managers talking about sector rotation towards commodities a month ago, saying they would be allocating in "in 4-6 weeks" which is about now, so maybe its just rotation.

I do need to add some banks into my portfolio though. It was pretty stupid not having that exposure.  Free money with the yield curve = higher stock prices.   I am going to buy a few shares of BofA, Blackrock, and GS, maybe 1/5 allocation, when money rotates out.

[jjj000]

FRG had a similar volume spike on Friday of a few hundred K shares that pushed it up 15% or so, after a slow buy in in the morning.  Definitely some manipulation going on there I think and would not be surprised to see it reversed next week.

BF - ya, hear you about being right but not profiting    Had I played my own prediction of a break above 990 leading to new highs shortly thereafter... which just happened... I could have made an easy $25K on S&P FUTs over 3 days.

I think the problem is, even when you are right, it's hard to not get spooked by the intermediate movements and the irrationality of it all (or so goes the saying)...

[Bottomfeeder]

3j....not sure, because I don't understand options very well, but I was "watching" FRG yesterday and figured that the move was all about expiration, although they have had alot of news coming out lately.

They look like a very good company to me.  Wish I would have added more on my 2.46 breakout call.  I added 20% but should have doubled.  I am looking to add some more at some point going forward, but will probably wait until the broad markets top out, correct and complete the cycle.  I am thinking somewhere between 875-950 SnP.  Thats my plan at anyway.