Leonard Marshall (#70) Disposes of Joe Montana
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It’s been a long while since I’ve talked about Chesapeake Energy Corporation [[CHK]] , but as I’ve stated, I think 2010 will be the year of the gas giants.

As you can see on this weekly chart, CHK is starting to break out into some free-air territory after a long way back from it’s CEO-stock liquidating days back in the Dark Times (ie, December of ’08, a bit more than a year ago).

In my “best of all world’s” scenario, I’d like to see CHK break through 30 with some volume, here, perhaps after a short pullback or consolidation. Barring that, I’d like to buy at a retest of $30 itself, which is the beginning of my free air scenario. As you can see, this thing has a lot of room to run, so I’m not going to feel badly about missing the first buck or two.

I also like ConocoPhillips [[COP]] , Apache Corporation [[APA]] and NGAS Resources, Inc. [[NGAS]] here, under the same cautious parameters. [[UUP]] is holding fast here at that $22.90, so all theses continue to hold true.

Best to you all.

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Should we expect more of the same in Day Two, 2010 trading? From a strict momentum standpoint, one would expect some follow through from yesterday’s move, despite the fact that it was a relatively “bleh” volume day, considering the move. And as you can see, we still have some room to go to retouch our [[VIX]] support line mentioned this weekend:

On the other hand, the dollar dropped precipitously yesterday (take a look at the move on the Relative Strength Index (RSI)).

If that continues, all bets are off, and we may be on our way to another devaluation based run-up.   Note, however, that we bounced off the 20-day EMA and filled a gap yesterday.    As I’d mentioned, if we stay above the $2.90-ish area, then I think the dollar strength story is still in play.  

If not, and the dollar continues to depreciate (as it must under this kind of pressure) then our one solace is the Year 2010 picks will be cracking as much as they were yesterday.

Semi-much to my chagrin, as I expected to pick them all up a lot cheaper.   All, that is,  except [[TBT]] , which I think may experience further strengthening, no matter what kind of equity market we see going forward:

TBT’s off about one percent as I type, so it may be a nice time to dip your beak, so to speak, with an easy stop below the 200-day EMA ($49.30) or even better, the 20-day EMA ($48.90).  

Good luck to ye all.

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Volatility looks to make a comeback in 2010, after a nine month doze. As you can see, we are approaching a significant support area in the [[VIX]] :
 

We’ve already come very close to the support line in the latter part of December, but we may revisit one more time before we break out of the triangle. I think once we bounce out, however, we go to at least the 200-day moving average, which should be around $26, at that point. If you look at the long term chart, you can see that even in bull cycles, the 200-day EMA has been a touch-point for the $VIX.

Now you can also see on the chart that my “box” allows for a break down from that level as well, so we must be on guard for the scenario as well. Never get wed to a position, etc…

My second bullish chart is in our favored sovereign currency. [[UUP]] , our proxy, has broken out of the congestion zone, and it’s next two stops are its 34-week EMA at $23.25 , and then the 61.8% fibonacci target, at $23.83.

As you can see we’ve come back fast from a long term downturn here, and I wouldn’t be surprised if we bounce off this congestion line this week, in a final flurry of hope. I expect that congestion line, however (at about $22.90), should hold for this cycle, and we will have further strengthening in the dollar.

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[youtube: http://www.youtube.com/watch?v=rMjAf8Nwohs 450 300]

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No, I’m not speaking of Mssr. Le Fly counting his Broken Robot Coin in his Counting House, whilst tossing flaming egg-nogs at his trader servant, Mssr. Le Cratchet.

I’m talking about the classic The Year Without  A Santa Claus double production numbers from those brothers of Sun and Snow, the Heat and Cold Misers.

This piece is actually a cover by Big Bad Voodoo Daddy (an RC favourite, no doubt).   While I prefer Dick Shawn’s Snow Miser in the original version, I have to give the overall production medal to BBVD, as they are large, bad, magical, and also your father.    Besides, Heat Miser is a mite too drag queenish in the original…

As I suspected, after a month’s worth of work,  the market [[SPX]] tipped over the 50% fibonacci line today at $1121.50 or so, and is now seemingly out of the box like a busted robot and headed to $1227, where awaits our Golden Ratio of 61.8%.   As I’ve mentioned, I think we will eventually get there, but not before a pullback, which could be quite gland-challenging.  

With [[TBT]] breaking out quite convincingly here, equities have been put on watch that their discount rates will continue to increase.   As well,  the dollar pullback, as shown by DXY and [[UUP]] today has also been de minimus.    Maybe all the rules of finance will continue to be suspended in honor of Santa and Rudolph, but I wouldn’t bet my Christmas gelt on it.   

That’s why I haven’t yet jumped in the molten gold pool yet, either, as appetizing as Royal Gold, Inc. [[RGLD]] and Silver Wheaton Corp. (USA) [[SLW]] are looking today.   I could be wrong, but I don’t think the dollar is done shagging with us yet.   No real worries, though, my Pagans.   Santa Ben will soon take up his ink stamping device and all fans of the continued mass portraiture of the Inventor of Electricity will be appeased.

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May all your families have a Merry Christmas and Happy New Year, even if it may be Pagan, or whatever.   It’s all about the kids, and what you make of them in the end, anyway.  

Best to you all, and thanks for your well wishes and support in 2009.

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Bonus Clip, Humour Division:

[youtube: http://www.youtube.com/watch?v=X6yUCbqAGrg 450 300]             

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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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Gurgle! Gurgle! Gurgle!
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Yea, and ye shall become as a Bear, and ye shall sup of the micturations of a turtle, in God’s syte and mercy. (Pantheons, Chapter 6, Verse 9)

And thou shalt impress upon yon Folio of Collycted Sycurities the [[SPY]] Seller’s Putt, in the amount of another Fyfty (50) certificates at yon pryce of $2.67, and they shall Stryketh at $110 dollyrs upon expiration in Janyary of 2010, the year of our Lord, in His infinite mercy. 

Your total therein and hereafter shall be One Hundreds and Fyfty  (150) Certificates of aforesaid Putts unto tomorrow’s dawn, whereupon ye shall stydy with great vigour the possible addition of surplus Certificates of Putt to be pyrchased.

Moreso, ye shall sell into the wynds of Chaynge and Hope another Two Thysand (2,000) shares of God’s own Silver Wheaton Corp. (USA) [[SLW]] , at a pryce of $17.21 by the lyte of St. Stephen’s Moon, though this cause ye great weeping and lamentation unto the Land.

Lastly, ye shall commit to the Church another shreeving of the Blessed Eldorado Gold Corporation (USA) [[EGO]] at a pryce of Fourteen pounds and twenty-seven pence.    Thine amount shall be an addytional Two Thysand certificates of common purchase.

Forswearing all meats and liquyrs unto the Eve of Christ’s Mass, ye shall pray unto the Lord for additional gydance and keeping always a gamely eye upon the Devil’s [[UUP]] and it’s mynions in the Federal Reserve Cathedral.

Keepest thou counsel close, and heare not the buzzing of Fool’s Inquisitions.   Stay thy course, and remain Upright in His syte.

May the Good Lord Bless ye and keep ye all safe unto Christ’s Mass.

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