I know the market was down just a bit today and we’ve been hitting new highs almost every single day. However, big runs always find resting points and big gainers undergo periods of consolidation before making fresh legs higher. We can very well be heading towards a lull in small cap action, sending many of you to the ‘fag box‘ for an expeditious rout from the battlefield.
For now, I am about 30% cash and I might up that level to 50% if the weakness persists. There have been lots of monster winners and logic dictates one shouldn’t get greedy up here. I have pre-set screens up in The PPT scouring for stocks that are up over 20% over the past 3 months, yet down more than 10% over the past week. I am biased towards profitable, very liquid, reputable names into a decline. The low volume, chinese burrito, moonshots are often purchased towards the end of a run up, since all of the good stocks have been bid up already.
I’ll let you suckers know what looks buyable tomorrow.
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Do you still own IFON?
If so, did you have a target in mind?
Spot on
Bita VIPs yy qihu all started out as low volume Chinese burritos
Courtesy of Tradingnymph
Collateral in China doubling/tripling. Human nature WONT disappoint bears
Chinese Trader Said to Pledge Metal 3 Times for Loans
Bloomberg News Jul 3, 2014
Decheng Mining pledged the same metals stockpile three times over to obtain more than 2.7 billion yuan ($435 million) of loans in China’s Qingdao port, a person briefed on the matter said, citing preliminary findings of an official investigation.
Showtime, Ah it is even worse then that. That multiple use for loans is being seen in other commodities. The Chinese Govt is locking down the port during the investigation and not allowing the Major Global Banks in to confirm their collateral is safe (so we know that loans to China Copper Dealers should be drying up fast). The only thing holding up copper prices is the Chinese Smelters are holding back production and Chinese Govt stepped in to buy copper when the price nosedived. Chinese have created this massive Bubble, they have been borrowing around the world at low interest secured by copper (thanks to QE), etc, then loaning that money out to Chinese Developers and Companies all over the world at higher interest. The world saw copper in demand and said there must be global growth. Chinese know that they can default on those loans because the global banks can’t touch them. Since 2009 they have been creating all of this, Stupid Shanghai Copper Bubble.
Stopped out of all my longs today. Will look to reenter at better risk/reward.
It Was An Ugly Day For Momentum Stocks
Read more:
http://www.businessinsider.com/ugly-day-for-momentum-stocks-july-7-2014-7
“In April, we chronicled the troubles of pseudonymous trader The Fly, who blogs at iBankCoin and is on Twitter at @The_Real_Fly. Following today’s trade, The Fly, who said he is bullish on stocks until late August when he believes the market will top out, had a less than encouraging tweet for investors in these high-flying names:”