Are You Able to Follow the Patterns?

The last time I saw oil stocks get pounded like this, it was the late 90’s and the internet had just been invented. I think people thought they could create their own oil online or something. But the price of crude tapped out around $10. At the time, I was trading internet and oil stocks, so I remember that moment in time as if it was yesterday. No one, and I mean no one, was keen on internet stocks at my firm. Everyone was playing games with Kodak and stupid shit like that. Back to oil: it plunged and I remember taking a 20% loss on one of my holdings, only to see it drop 50% and then another 50%.

Like all massive declines, the precise percentage loss of most oil stocks back then was around 70%, give or take a few points.

The humorous thing about the catastrophe in oil today is the laissez faire  demeanor of the market, generally shrugging it off.

Oh, but before it shrugged it off, it needed to switch up the patterns and GRAPE-RAPE some of you into thinking we’d be in for a late date drop. Well, we dropped and now we’re popping.

See how they changed the pattern on you? You were over there shorting stocks, buying VXX tits like a bird eating seeds. Now you are being slapped in the face with small pieces of bamboo again.

Stocks like GILD, PANW, TRN and FMSA interest me down here. I sold out of my trading position in PANW 13 points higher, so I don’t mind going back to the well. The only issue that I have with buying stocks, other than utilities and REITs, is that they’re probably on the cusp of going much lower. All of these things that you see happening before your eyes isn’t by accident. There is a disease permeating under the surface and will soon strike dead all of those who are exposed.

How can you survive the storm?

The gulf states aren’t panicking as much as you think because oil is priced in dollars. Get it? In a way, the rise in the dollar has hedged much of the downside action in crude.

Here is an outline for what to look for, when allocating new money.

Rate sensitive industries, like utilities and REITs. Avoid banks, as lower yields crushes their margin.

Mega-cap staples yielding greater than 3%.

Bonds

Restaurants

Retail

and lastly airlines.

If this ebola nonsense takes a back seat and the economy remains stable, then airlines will soar. Until we can figure that out, I’d stick with the Utes.

 

IMPORTANT BULLETIN: This evening Chessnwine will be hosted The Annual iBankCoin Markets in Turmoil meeting. Please leave your questions for him in the comments section and he will try his best to answer you in a video. The show will begin at 7pm.

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