Friday, February 24, 2012

Canadian Volatility ETF

There's a Canadian "double-long" style volatility ETF. You obviously don't want to hold it when $VIX is descending down from 50... but is it a good buy when $VIX is down to 16 and change?

I dunno... the upside on this thing seems pretty strong... Just $10K in it could provide me some massive downside protection. And if UUP looks oversold, JNK:LQD is having a hard time breaking upwards, and it looks like SLV andd GDXJ are giving back a bit of yesterday's gains... well, why not?

In contrast to the crappy miners:

I dunno about you, but to me SIL seems to want to begin painting an upward-sloping channel. And MACD (if you believe in that sort of thing) looks about to cross up.

And GDXJ seems to be painting an inverse H&S, target... somewhere a lot higher than right now.

Again, y'know, it's a confluence of signals that's got me. Which way should I lean? Frankly, I'm just going to sit tight today and let the market determine where it wants to go.

Friday videos: the sexxxay dirtiness that is Ke$ha

Here's a Ke$ha video cavalcade!!

We'll start off with Ke$ha getting all dirty, and singing a song about how she likes a guy:

And then, a song about getting drunk and partying!

And then a video where she gets all dirty, and... um, sings about getting drunk and partying!

After which, she progressed to a song about... um... how she'd rather have sex with a guy than listen to him talk....

And then! A song about dressing up all dirty, and going out to get drunk and party!

And then! A... um... song about getting drunk and partying! Except this time she also exterminates the race of half-human half-unicorn hybrids.

So... okay. She actually has a sense of humour about the whole thing. You didn't get that before? Well, now you've got it.

Just to make absolutely sure that the clueless half of America gets it, she does another video where she... um... likes a guy. Except this time she slips him roofies and takes him home and ties him up.

And... um... all of a sudden she turns into Kate Bush?!?!?

Reportedly, she's coming out with a new album in a couple months, where she's ditching the club electro in favour of... um... "cock rock". Like AC/DC. Really.

I actually look forward to it.
Before getting too wrapped up in using the $HUI as a diagnostic tool for determining whether to buy the miners or not, it serves to take a look under the hood:

Kinross' chart. Sucks. No alternate way of reading it.

Agnico. Sucks. No other possible reading.

Goldcorp. Doesn't really suck. You'd think it might even have room to run.

Coeur d'Alene. What a frickin' awesome chart.

BTW, my "technical analysis" that determines whether a chart sucks is this:

1. Does it ever get above its medium-term EMA resistance/support line?
2. Would you have ever made a fucking cent buying the stock, like, ever?

Another interesting thing in these charts, if you're of the opinion that $HUI is due for a pullback, is this:

K and AEM are at resistance. So they'll probably turn back down. G looks like it's trying to establish a slowly rising channel, so it might want to turn down now. And Coeur looks like it wants to paint an inverse head and shoulders.

To someone like Otto that's probably all voodoo. But really, to me, I'm seeing a confluence of things here - several miners' charts are all at points where you'd expect them to back off.

So should I sell some stuff and cash up? I think BTO and FVI and RIO have run as far as they can, DPM and AR too. So add all those together, and maybe yeah, it is time to dump?

Thursday, February 23, 2012

Late night thought...

Hey um, so, like... what do you think the odds are that we're about to see a bubble pop up in gold and silver, and maybe even the miners? Like, over the next month? $2000 gold, $50 silver again?

I'm only thinkin'. Y'know, it's always good to puzzle out all eventualities. Just in case they happen.

I'm also trying to jinx the market. To see if I can.

Carry on....

did you send out that memo about silver?

Apparently, that memo never got sent out. You know... the one that JP Morgan the Lizard People & the Joos were supposed to put out, explaining how the short silver lease rate of -0.4 at the OpEx meant silver was supposed to get beaten down this week.

Anyway... since you saw yesterday's portfolio, I'll tell you some changes. I dumped $10K of SBB at just below cost (the position needs to be resized - it's just that large because I averaged down like a nutbar). Then I bought $10K of HZU and $10K of FVI, since I saw the action in silver this morning and figured this would be a +5% day. After all, the Lizard People have to cover their shorts, and Glorious Leader Sprott is squeezing them valiantly on the battlefield, no? No?

Plus I took to heart the anonymous mocking comment questioning why I didn't have any FVI and so on.

That's about it. Still happy with CAN and USA, and have also been rewarded for picking up GPD at .62. Would buy other things, but I'm close to zero cash and will need to unload some stocks before I buy others. I'd still like to see RMX move up, I wouldn't mind buying that, but damn that chart looks weak.

I'm thinking I'll be rotating out of silver and into copper soon. That makes sense.

But I don't want to sell my winners til they've stopped winning. I'm happy that yesterday I avoided making any transactions at all. Yay me!

Wednesday, February 22, 2012

model portfolio update

Just for mocking purposes, and to illustrate the extent of my trading prowess, here's my portfolio as of this instant:

11k AQM @ .48
6.4k AZC @3.09
3.5k CAN @1.43
1k DPM @10.28
8k GPD @ .62
100k GPM @ .31
25k SBB @3.83
5.5k SGR @ 1.77
13.5k SWD @2.19
9.6k USA @2.17
500 ZJG @ 18.86

Obviously, some of these positions are of the "buy and hold" type... as in "well, I bought this worthless sack of shit, I may as well hold on to it."

Which of course is dumb.

Until it proves smart.

Which it often never does.

la de dah....

Still waiting for that silver OpEx collapse.

Gold shot up. Funny enough, Sabina Silver shot up too. I guess maybe they have some sort of gold, or something, I dunno, I don't follow it that much, just got 40% of my equity tied up in that dog.

Felix Salmon sez: oh shut the fuck up about Greece you doomers

Felix Salmon has a good article today on how there's still loads of utter runny bullshit being printed in the US press about Greece and default, even in supposedly non-asinine places like the New York Times.

Go read it, because frankly, if/when Greece defaults on March 20, I expect you'll see a 5% drop in the market... followed (before 4PM close) by a 5% recovery back to where it was.

I believe so strongly that this is the case that I'll even allow you to hold me to it as a serious prediction. The market will dive on a Greek default... then the smart money will realize there's no reason for it to dive, since Greece has always been an utter basket-case, and the market will instantly recover.

You'll be sitting there saying "wait... what? Uh... you mean it was never a problem?"

The media's job is to generate content. Not necessarily good content. Just content that grabs eyeballs long enough to advertise to them. Read the few people who aren't utter fucking morons.

Speaking of which, I am not an investment professional, nor an adviser, nor an analyst: just (yes, seriously) a raving madman standing on a street corner with string hanging out of his mouth, screaming about the coming robot apocalypse. But there's one advantage to being a dangerous lone psychopath: it means that I've managed to learn that there's little difference between most of the "mass narrative" that you come across in the media and the inane chatter of prosimian lemurs deep in the Madagascar jungle. They make noise just to kill time between meals and poops.

Seriously. If you're the type of person who can't listen to talk radio for more than 10 seconds without screaming in agony because of the intense pain the stoopid causes, then you probably have an advantage in the market. At least there's one place where being a psychopath helps.

ETF Trends: silver ETFs and miners

Chart of the Day: Silver ETFs and Miners

Good article at ETF Trends today about SLV and SIL. Of note, net inflows to SIL are $355M YTD. Pretty bullish, eh?

Warning: the article contains a chart, and also is bullish silver. Two things that some readers might not be able to handle.

Tuesday, February 21, 2012

always with the happy feet

Thought I'd buy some RIO and BTO at the open... didn't, thinking they'd already run far enough. Have now been proven horribly, horribly wrong.

Bought some CAN, SGR and DPM at the open, thinking their charts look nice. Also dumped the rest of my BCM today, probably going to be proven horribly, horribly wrong there but I already have enough silver exposure (USA and SBB mainly).

Trying to spend the rest of the day "being right and sitting tight". Not terrifically right, but right enough to not be too much in the red.

Running commentary/attempt to be obnoxious

Hey, see that? The v-bottom on the S&P and Q? The attempt to sell into strength at 10AM, turned around into a surge back upward?

And hey, see silver going up again?

To da moon Alice!

Well lookie here....

Gold and silver are up strongly at the Nymex open.


And yet silver OpEx is Thursday, and yet silver short lease rate is at -0.4.

Monday, February 20, 2012

Holiday video

I'm on YouTube drooling at the dirtiness that is Ke$ha, and have decided to honour you with an extra video.

Yes, rap really is this funny.

funny search keywords

I always check my blog stats for funny search keywords.

There's usually a few along the lines of "kinross sucks" or "agnico sucks". I had a whole bunch of Jeff Berwick searches recently. "Is it time to sell Geologix" came up a while back (I frankly think it's a frickin' home run dude, after all, Grandich says so, and have you seen the NAV on that monster?).

Today there was a search for "Brent Cook's nose". No, as far as I can tell, nobody has punched Brent in the nose. Even if he ever would cause a ruckus, he's so understated and gentlemanly that a person wouldn't realize he'd been punk'd til 6 weeks after.

Anyway, seems nobody is trading on the market today. So I'm off to do other things. Bye.

Sunday, February 19, 2012

So was "so is this the end of the bull move or not?" the end of the bull move or not? - An exercise in recursive narrative analysis

Funny that my last post got a lot more views that the typical referral from IKN does.

That suggests to me that there is a lot of angst and concern about whether this really is the end of the bull move or not.

That improves my confidence that this was not the end of the bull move.

Then again what do I know. And look what I'm basing it on. Sheesh.

But oh look: silver's up 1% in Asian trade. Hm. Are we still expecting an OpEx smackdown?

And even if so, what's that got to do with the end of a bull move?

Oh, and while we're on the subject of gold miners and negative-pressure generators....

Hey, and in case you missed it, Kinross has decided to take a leaf from Hecla's playbook.

I.e. they're getting sued. For, y'know, alleged securities violations, alleged holding back material information, alleged screwing shareholders or whatever the proper alleged term is.

Wait, that's not supposed to be a good strategy?

All I can say is, ask your local technical analyst to explain how this modifies his analysis of the $HUI:CCY ratio.

Disclosure: I am not a lawyer, but I do find it funny how that phrase's acronym is IANAL.

On mean reversion, bollinger bands, and how "suck" foils rational expectations

Two things I learn from this chart:

1) It's not necessarily a good time to buy a stock and play a mean reversion just because a stock hit its lower bollinger and went more than 2 SDs negative from mean. Or because RSI came back up from below 30. Or because MACD crossed over. Things going down don't necessarily ever go back up, and who wants to waste precious time waiting for Agnico to go up when you can pile all your money into Geologix?

2) Agnico Eagle truly stinks. Not the flavourful aroma of well-aged Tilsit or the inviting seafront odor of a putrefying shellfish midden. Not even the suggestive luscious scent of sweaty unwashed crotch. No, Agnico stinks like a physical manifestation of some vile god of disease and decay. It's the goatse of the miners: what has been seen can never be unseen.

Seems the sucking began around December 2010. It only accelerated in October.

Disclosure: you gotta be fucking kidding.

Huh. Josh Brown got there first.

Huh. Not an original thought in my head, I guess.

I was googling for "brent cook" "mickey fulp" "band-aid", and came across a blog post somewhere that led me to a Josh Brown post from November 2011 where he goes into some basic detail about how much gold miners suck.

And all this time, I had thought I'd been saying something insightful, new, and original.

So is this the end of the bull move or not?

(UPDATE: had to clean up the post a bit since it got recommended by someone. No, I didn't delete the swear words, I just tried to tie off a few loose ends.)

In the words of Galileo, "eppur si muove".

Basically, the Pope put Galileo on trial and forced him to recant his belief that the earth moves around the sun. So he did; then as he was leaving the inquisition, he was purportedly heard to mumble "eppur, si muove", which meant: Nevertheless, it still moves.

I find I've figured the market the best when using a sociological, "mass narrative" approach to things; I see what the market's doing, then I look for the explanations from the bloggers as to why it's happening. I don't believe any of the explanations; they're all post hoc anyway. But, according to social constructionism, we live in a reality that we constantly create through our conversations. And since the market is a cybernetic system - i.e. one whose outputs determine its own inputs, through O-I translation mechanisms that are tuned differently over time - and one major input is the mood of the market itself, the narratives (whether correct or incorrect) still impact the market.

But it doesn't mean they're right.

So I find it funny that, without even going to permabear sites like ZeroHedge or Mike Shedlock or Hussman, I can still find people foaming at the mouth about how (basically) the market is not realistically pricing forward earnings, and it has to go back down, this bull run can't last. Ooh, US gasoline usage is down; ooh, copper is failing to confirm; ooh, seen the Dow Transports?; ooh, look, the Baltic Dry has collapsed; ooh, 98% of this move was Apple and Caterpillar; ooh, blah blah Greece blah blah; and so on.

Look, if you go to a dispassionate data-watcher blog like Bonddad, you'll find that the US economy is rip-roarin'. It's gotten through a housing collapse and liquidity crisis, and yet it's still been showing growth - and now, US unemployment is plummeting down through the 8% barrier; that should mean the economy even gets better. Oh, and the US is still the world's largest economy, so how they're doing affects the rest of the world.

(By the way: the US will affect the Greek economy far more than the Greek economy will affect anyone. Saying that any Greek problems will hurt the US is like expecting a mouse to bring down an elephant. Give me a fucking break.)

As for all the other bullshit? $BDI is down because there's an oversupply of container ships, entirely because in 2006-7 too many new ship orders were placed. That affects the transports (strangely, US intermodal rail and trucking are showing good numbers). US gasoline usage (and mileage) are down, but that's post hoc - you're not seeing that reflected in a collapse in production, and just because you'd think it has often been correlative in the past doesn't mean there's not a good reason for the correlation to break down today. Yes, Apple has skyrocketed, but that's because everyone and their granny bought an iPhone this month (which... um... should be reflected in Apple's price, and therefore should reflect in the NASDAQ average since Apple's not operating in a vacuum); and Cat skyrocketing is actually a fantastic indicator of the return of world demographic growth as a market driver, no? Like, mining and tractors and stuff?

People (except, supposedly, the recently-converted ex-permabears) are all trying to find reasons to disbelieve the advance.

Greece? Give me a fucking break. The problem with Greece was originally that a Greek bankruptcy would drive up yields in the other peripherals (cos everyone would be betting on who's next), eventually causing a banking system collapse due to heavy peripheral exposures and the leverage based on them. That can't happen now. The ECB is printing money to buy peripheral bonds (see Italy's 10Y yield drop from 8% down to under 6%?) while also taking on toxic peripheral debt through their LTRO, thus recapitalizing (and possibly de-risking the leverage of) the banks. As Kiron Sarkar keeps pointing out, this is a QE program, an incredibly vast one, and it ends the chance of Greek doom.

Basically, there's all this chatter about doom. And yet the market is still going up. Eppur si muove! No narrative about the market has any value to you if it fails to explain why the market is still going up.

What's really going on is, everyone is holding their breath, expecting an imminent chainsaw assrape by a 20% market crash, like last fall all over again. It's the recency effect. Eppur si muove.

Basically, the market's going up from here. Things are better now than they were in the fall. Fall isn't going to happen again. There is no longer a dooooom. (Except maybe a China collapse, as I keep saying - um, but you should probably see an early warning sign in an unambiguous waterfall collapse in commodities, like we saw last fall.) And when there's no dooooom, the logical place for any market to go is up. Because when things aren't getting worse, they're getting better.

Don't hold your breath for the next 3-5% correction to be the next 25% market armageddon.

Now if only gold miners didn't suck.