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Note: I am reposting my “market predictions” from the recent iBC piece we .pdf’d because I want to be able to keep track of some of these picks I’ve mentioned, especially the natural gas and water choices… For my non-market prediction  you will have to refer back to the original document.

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In the year 2010, much CHANGE will come unto the land, and we HOPE it’s change we can believe in (for a change).

Markets Wise, here are my 2010 predictions:

Reversing the traditional “January Effect,”  the market will pull back some 7 to 14% in the next month, with the techs leading the way and taking the rest of the market with them once they break down — much like the [[QQQQ]] took the rest of the market up on the recent breakout. 

The [[SPY]] and [[IWM]] (Russell 2K)  will follow soon thereafter, along with good old [[DIA]] .   Then I expect the market will rezoom (sic) it’s move to the 61.8% Fibonacci Retrace that it’s been pointing toward since the March ’09 lows.   That should be about $1,230 or so on the $SPX.

Accompanying this retrace move will be the US dollar getting to at least $80 (on the [[DXY]] ) and [[UUP]] our trusty ETF companion,  back to resistance in the $24.05 region.    The breakdown from these levels should signal to us it will be time to “Party-on Garth” or similar 80’s era SNL spin-off movie platitude.

The first friends to recover from the coming breather will be our trusty commodities, in the form of gold, silver, platinum, molybdenum, natural gas, and even coal.   Oil will trail and probably rise with these sundry boats, but I’d wait on it for the rest of the market.   As usual, the Jacksons will take the fore, with Silver Wheaton Corp. (USA) [[SLW]] ($12.50) , [[GDX]] ($42), Royal Gold, Inc. [[RGLD]] ($43), Eldorado Gold Corporation (USA) [[EGO]] ($12.40), IAMGOLD Corporation (USA) [[IAG]] ($13.50) and honorary Jackson Allied Nevada Gold Corp. [[ANV]] ($12.50) continuing their winning ways in 2010, and non-PM Jacksons Thompson Creek Metals Company, Inc. [[TC]] ($11) and Teck Cominco Limited (USA) [[TCK]] ($34).    

I even give former Jackson plodder  Natural Resource Partners LP [[NRP]] ($23.25) a shot in 2010, as it will rise with the coal stocks.  That said, I like Massey Energy Company [[MEE]] ($34-35) and Patriot Coal Corporation [[PCX]] ($13.50-14.00) better for that play.

Shocker, right?   Well how about some natural gas picks as well, as I think that sector will also finally run in 2010, mostly on a mean reversion basis.   None of this Chinese stuff, though.   I think the Chinese will be using all that coal they’ve dug before the natty.  No, I like good old ‘Murican gas, in the forms of my old favorite Chesapeake Energy Corporation [[CHK]] ($24.75), NGAS Resources, Inc. [[NGAS]] ($1.65) for a crazy Lotto play and Northwest Natural Gas [[NWN]] ($45)  for the “safe utility play.”

Last but not least on my commodity list is the water companies, which I think will also have some mojo in a commodity constrained shrinking dollar environment.  There’s been quite a bit of consolidation in the water names, but most of the business remains in public utilities.  I think that will change as municipalities feel the bite of lessened garbagio fines and other taxable nuisance fees to pay their egregious unionized work forces a “living wage” (Chicago Speak for $142k a year, pension and health bennies).   Municipalities will be looking to offload capital constrained public water assets and these companies will grow.  

There’s none I like better than fat, liquid (no pun intended) American Water Works Co., Inc. [[AWK]] ($21.50) and not simply for it’s “Men from Mars” ticker symbol.  I think these guys are the gorilla and one to put away for the long haul.   There will be more water companies coming public, God willing, and their M&A actions in this market will bring recognition to these names and the value of water assets in the next ten years.  I also like California Water Service Group [[CWT]] ($35.50), Aqua America, Inc. [[WTR]] ($15.50) and the risky desalineation play Consolidated Water Co. Ltd. [[CWCO]] ($13.20).  

Crazy tech plays you can get from Mssr. LeFly, but I like [[BIOS]] here on a pullback to $8.00.  I think once it gets past it’s old highs of $9.82, it’s off to the races.   I also like Fly’s Green Mountain Coffee Roasters Inc. [[GMCR]] on a pullback to the $69 range.

Last but not least, I think you need to have some [[TBT]] ($49) in the portfolio.   We’ve many deficits to finance before we’re done in 2010 (as much as $1.5 trillion) , and over $2 trillion in short term debt to refinance.   I just don’t know how they do that without further pounding the dollar, and putting pressure on interest rates.   I like TBT as a hedge and as a long term play, deep into the middle of this coming decade.

2010 is an election year, so I think the pols will try to make it look good at least until November.   That means we will get favorable news on tax increases, despite the clamour (sic) of the socialist bodkins on the far Left of the Democrat Party.   That’s another reason why I strongly beleive Benjamin- printing will continue into 2011 and on.

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I see you!
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Despite the best laid plans of mice and men, not to mention Time Magazine weasels, physics still work and even fiat currencies bounce.   We are experiencing a necessary breather here in the nine year plunge of the dollar, otherwise known as The Potemkin Bull.

Here’s a hint as to where I think we’ll be going in the near term on the dollar proxy [[UUP]] :

 

Before you get all excited about your extra-ursine activity however, just know that this is not likely to last for very long.   Give it a couple of weeks, tops, before Time’s Genius of the Year  presses the one button he’s made available to himself to guide us all to economic Valhalla. 

That would be the button that attaches to the dollar printing presses.   For those of us who’ve been following the path of Jackson, that will be our signal to start buying miners and royalty plays again, this time in size.   In the meantime, I’ll be over here adding a little more [[SPY]] puttage, maybe some [[TZA]] and a couple of dollops of [[DUG]] for (just) deserts.    If you are in The PPT already, you will see the purchases first, as you have been.  

If you are not, then “a ha’penny will do,” I guess.     Off to listen to the sounds of “fap-fap-fap-fapping” coming from the Dope Slope.   At it’s crescendo, I will be buying gold, glorious gold.

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I am so very very happy…
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Despite the great sturm and drang of late day trading, the charts for the [[SPY]] still look relatively benign, and price is not even hitting the 20 day EMA yet.   True there’s been some readily apparent divergences in the MACD and RSI, but nothing to get overly excited about if this is just a consolidation for further action upward.

Canaries do cough in the coal mine, however, and one of the yellow hackers is perennial bull-nuisance   [[BKX]] , our Philadelphia Banking Index, which is currently humping over like poor Quasimodo at Esmeralda’s keyhole.   With the 200-day EMA ($43.42) breached today with considerable vigour (sic), I think this index stands a chance of falling through the  more recent support level illustrated below, at about $41.75:

I believe that if it does breach that level, the $BKX will likely bring the rest of the market down with it for at least a short term hiatus.

For my part, I did nothing trade-wise today save analyse (sic) highly intellectual rap orchestrations with Mssr. Le Fly, whilst eating peanut butter and banana samiches.  

Tomorrow, I may or may not do the same, but I will surely let you know.   Quicker still, if you’re residing inside The PPT, of course.

Best to you.

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Remember, don’t ask for any bullshit cawfee machines, kids!

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Sawry, I just got a bunch of deal docs dumped on me at the end of the day, so I haven’t the time to defenestrate lefties or argue the merits of very tiny disposable instant cawfees.  

You’ll just have to make due with two interesting ideas that popped up today.   Overall, I still think we’re just about to roll over, but that doesn’t mean you can’t corral some cheese goats in the meantime.

First chevre du fromage is [[TBT]] , which seems to be indicating that — sovereign debt crisis be damned — US Treasuries are not exactly the bargain of the year, ovah heah:

A little bit overbot in the RSI, but one to watch.   Next stop, the 50% fib at $50.27 or so.

Besides our PM’s,  TBT is one of the best defensive stockso to hold for the coming currency dump.

Next, titanium producer RTI International Metals, Inc. [[RTI]] which I’ve owned off and on in the past, but own none right now.  I think the commodity play will be on in full force later in the year, but I also think steel is moving early:

 

Ciao, bella.

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Swisher Sweets are Smoo-o-o-o-ooth.
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I’d walk a mile… for a Camel… (and to buy that last piece of that January [[SPY]] put position– 50 more @ $2.89-2.92.)

Bryl-Creem, a little dab’ll do ya…. (just like a concentrated position in sold calls and targetted puts will “smooth out” the rough spots in a downdraft).

Winston Tastes Good, like a cigarette should… (so do 20 more [[GDX]] March 50 calls sold at $8.00 a pop.)

Rice-a-Roni, the San Francisco Treat…  (not unlike [[PTM]] , which has stayed strong — and unsold– while it’s brother PM’s have sweated.  That may change tomorrow, as I may take a third off, despite my lack of a full position as of yet.)

N-E-S-T-L-E-S, Nestles make the very best… (chocolate, maybe but not market hedges.  I expect we’ll have a bit of a global pullback, so even the traditonal consumer product hedges may be of little use.   Note that Brazil took a dive today from [[EWZ]] ‘s tops over $80.   A little [[EEV]] may be a choice smoothner her for a week or so.)

The best part of waking up, is Folger’s in your cup… (but maybe not Green Mountain Coffee Roasters Inc. [[GMCR]] if it breaks through this near term support at $60, right here.  Next very strong support is $55, which I would consider “back up the truck territory,” on a bounce.)

Best of all, it’s a Cadillac… (but not if you’re a GM shareholder, Ford Motor Company [[F]] is actually looking good here on a pullback to $8.50.  I’m sure Mr. Cane Thaler is well pleased)….

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Feel free to add some favourite (sic) advertising slogan-themed picks of your own.   I’m off to dinner at a fantastic local restaurant.  Ciao.

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Jake Cashes in some Chips for “Butter & Egg Money.”
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Yes, I’m raising more cash ovah heah, and even buying puts for the first time since the March ’09 lift-off.    Sure I’ve sold calls in various weighty PM positions before this, but today I actually bot a starter in January [[SPY]] puts.   100 Jan 110’s @ $2.82-.85, to be exact.  

Was I early?  Sure looks that way.   That said, I think we’ll have a dollar bounce here very soon, and my purchase will prove propitious.   That said, I won’t add the second half until  I see a break, ovah heah.   Note the evidence:

In the meantime, I am continuing to sell down exploding higher PM positions, much to my rue and chagrin.   I just sold 2k more Allied Nevada Gold Corp. [[ANV]] @ $13.97,  2k more Eldorado Gold Corporation (USA) [[EGO]] @ $13.92 and 4k more [[EXK]] and Golden Star Resources Ltd. (USA) [[GSS]] at $3.91 and $4.23, respectively.

I cannot bring myself to sell anymore Silver Wheaton Corp. (USA) [[SLW]] , even as I know it’s the right thing to do at this juncture.  

My advice?  Now that the Fly is legitimately cussin’ and hollerin’ I think it’s time to raise cash like it’s “bread day” in Zimbabwe, people.  

In the least, it will be good practice.

Salud.

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