Signor Fibonacci Challenged Again!

This time by Signor “AG” — the lustrous white metal we like to invest in using [[SLV]] . I’ve got SLV’s 38.2% retrace (again, a “strong level”) sitting right at about $16.80 (again, click on the chart to expand it).

Now I’ve got more silver than I know what to do with, and– to my teste-aching chagrin– even a little Silver Wheaton Corp. (USA) [[SLW]] — otherwise known as “the bane of my existence” as of late.

But if you Gollums are interested in getting in, or back into one of the two “My Preciouses” (the other being [[GLD]] which I’ll cover later), this would be an opportune moment. SLV’s next fib level (50%) is at $15.67, by the way. Even I may add if it gets to that tempting area.

Gollum!

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Well, that was oddly efficient wasn’t it?   I have to admit, I didn’t quite think Chesapeake Energy Corporation [[CHK]] would see $45.00 this quickly, and the move feels almost canine-transformative as it “gives me some paws” (sic).

However, all due respect to Mr. Limm’s Dawg, I believe I shall indulge in a “half position” of CHK at these levels (currently $45.20).   The stop can be as tight here as you like, with the position sitting right at the fib line, but I will set mine at $40.50, which is below the next area of support, and at about a 10% loss.

Happy hunting.

Update: The Mosaic Company [[MOS]] has obviously broken through that noisome $115 area, but I shall not get hoggish.  Looking to cover half my position at $109.60, which indicates the “gap fill” from the April 4th, ’08 gap up.   I will cover the rest at the next fib support of $106.05.

Ciao.

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Our long time friend and ally, the Oil Service Holders Trust [[OIH]] looks ailing here, as it has broken through near term support at $190.   Next stop I see is it’s 38% retrace (long term fib chart) at about $183.50.   As I’ve mentioned, that’s a strong line historically, and we’ll likely see a bounce there.

That said our two favourites (sic) in the space,  Transocean Inc. [[RIG]] and National-Oilwell Varco, Inc. [[NOV]] seem to be leading the charge southward.   Not a good sign.   RIG is already through it’s near term 38% fib retrace at $137.30, and heading for the 50% near term line at $129.60.  There should be even stronger support at the longer term two-year fib support at $125.10 or so.

NOV knifed through it’s near term 38% fib line at $76.70 “like butter” this morning, and seems to be on a course to touch at least its near term 50% fib support ($71.70), if not it’s longer term 38% line at $67.80.

Let it be known I am not surprised at this pullback, given the bullshit blow off in oils.   Am I also convinced this is no “top,” however.   I think these longer term 38’s will hold here and represent excellent long term entries when they show some accumulation on volume at those levels.  

Aside:  The Mosaic Company [[MOS]] is getting the homo hammer as well at the moment (disclosure: I am short MOS from the mid 120’s), but seems to be holding on to the recent July lows.   If MOS cannot convincingly puncture the $115 level with authority today, I will likely cover.

 

 

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Q4  (23 months, Hibbing, MN): I don’t even know how many of you recognize Q4 from the comments section.   For the most part, he’s restricted his posting to Fly’s blog alone.   Nonetheless, he’s a regular poster most readily identified by his eclectic music tastes, which he shares with the group via embedding usually one selected youtube video per day.

Sometimes, but not always, Q4 will add some sly market commentary-related  “title” or blurb to his piece, but I have to admit — I may just be imagining that.   Suffice it to say, I’ve become a big fan of Q4’s aural offerings, even though I probably only really like about one third of them, and some of them can only be described — in my opinion at least — as down-right awful. 

Something you maybe didn’t know:  Q4 is actually short for “Quadphonic Random Select A.I., Series IV.”  He’s the property of iBC Enterprises, LLC,  a joint venture whose unit holders include Fly and Jeremy, among other silent partners.   In addition, Q4’s final product included some non-equity consulting work during “end stage development” provided by Boomer.

Starting out as a freshman year coding project from Jeremy’s “Hardware, Music and Informational Bioengineering 101″gut course, “Q#1” was a graduated learning software-hardware artificial intelligence device that worked with web spider inputs to “sample” all the music currently available on the internets according to a set theme as programmed by its operator.   In the original case, this theme was “cannabis sativa” — randomly selected, according to all parties involved.

 That first version was a dismal failure, however, showing a marked proclivity for the pan flute musings of Zamfir and the other Greek “masters,” while developing an annoying habit “auto-calling” the local Domino’s and sending anchovy pizza to Jeremy’s dormitory at embarrassing pre-dawn hours.

While still in school, however, Jeremy met Fly at an “Intro to Banking Serious Coin” seminar during North Dakota State’s Career Day, and convinced him to further capitalize his device research.   Fly eventually agreed, but insisted the A.I. be targeted at market dynamics, to spare him the “bother” of having to dig up relevant “end-of-day” video to cap his daily commentary on Fly’s original blog — “Flyonwallstreet.com.”

Given his charge, Jeremy set to work on “Q3,” and was initially frustrated by the machine’s first tendency to select the favorite polkas of Larry Kudlow.   He worked that kink out by cutting back the device’s CNBC access, and  flooding the system with Jim Rogers interview transcripts.   Frustratingly, his progress was impeded once again when he hooked the device’s data feed into a voluble “Mad Money” episode too close to a particularly rocky market close, thereby eliciting the entire Donna Summer oeuvre played at 66 RPM–on a continuous loop– for 24 days straight.

Fortunately, Jeremy worked through these problems and others with some help from Boomer, and a steady stream of cash (UPS Packets, rubber-banded $20’s) and high quality cognac sent from Fly in New York.  Q4 was finally finished in September of 2006.    Developing organically and apace since then, he’s been “released” into the software of iBC.com, and performs his primary duty of choosing Fly’s “end of day” video as first planned.

There have been glitches, sure.   This “Vincenzo” stuff Fly jokes about when the site goes down?  That’s just Q4 working on “understanding” the Miley Cyrus phenomenon, or some other market-based musical quandary.   Like a bright child, he’s learning all the time, and I’d ask you to forgive his hungry “mind” even if it brings the site down every now and again.   

As well, Fly has allowed Q4 permission to begin interacting with his guests here, so don’t be surprised if you get a “reply” from this growing electronic brain.   But even if you do not,  be sure to check each of his musical offerings, and see if you can make the market connection that multi-petabyte personality is seeking to illustrate.  Who knows?  It might make you some money. 

PS — don’t be alarmed by this picture Jeremy sent me of the pile of hardware bubbling away in his parents’ basement.  Q4 is a work in progress, you must remember.   Besides, Jeremy assures me “all that Apple shit” looks exactly like this, underneath the phaggy white plastic marketing cover crap.

Selected Jake-atar:

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You guys already are being feted by gunslingers aplenty on this site, and gosh knows, you’re far better off going to Fly, Cajun and Gio for the day to day, and even minute to minute stuff.   Being a guy who’s got a business to run, I can’t always keep an eye on the market from minute to minute, and I suspect at least half of you are in the same boat.   Personally, I’m always on the lookout for relatively safe stuff I can purchase with a “sleep at night” perspective.

Therefore, I’ve decided to limit my stock recommendations this month to those long term “try and  holds”  that you can put away for longer periods of time, whilst eschewing the more go-go stox (sic) our iBC trader-types hold for less time than it takes a banana to go yeller.    

Most of you know I’m a bear “ovah heah” and came to that conclusion after finding way too many sectors with nothing but bleakness on the horizon, starting back in late October of 2007.   I do think there’s a way to survive this market, however, by buying at the right time and holding until a cycle turns.  

Despite my bearishness, I believe there are still sectors that make sense for the long term, given certain economic realities like the dreadful Fed-induced devaluation of the dollar and the ever increasing costs of healthcare.   I think these realities will continue to keep commodities and bio/pharma/healthcare stocks attractive going forward, even as we may suffer through the occasional liquidity contraction like we are right now in the commodity sector.

The weekly charts are helpful for “perspective” in these type of meltdown situations, and I believe they can often give us hints about an attractive time to make a safe purchase, especially when they’re used in conjunction with long term fibonacci retracement levels.   

By the way– I’m going to take the fundamentals of these particular companies as a “given” but I encourage you to research them on your own.   Suffice it to say, I take the GE approach on my long term portfolio investments and try to only invest in the “#1” or “#2” best companies in a particular industry.  

With that factor in mind, I think if you consult with Fly, Alpha, Chivas, or any of the other professional money managers that frequent this site, they will agree that Chesapeake Energy Corporation [[CHK]] is the gold standard in the natural gas exploration and distribution category. 

Above is CHK’s weekly chart (click on it to enlarge), and as you can see, Chesapeake has been hammered almost unmercifully during this recent commodity pullback, and it is well off it’s highs of $73.00.   The good news is Signor Fibonacci gives us a pretty great — and safe! — entry indication in the $45.00 area here, right where the “super strong” 61.8% fib retracement line lies.   You’ll note from my previous comments that the 61.8% and 38.2% (inverse) lines are my two favorite fib lines, and they serve me as well as great exit/entry points for both shorts and longs.

For these CHK fib retracements, I used the early January ’07 lows as my starting point (as you can see, that’s a pretty strong support line going back some time), and the recent late June ’08 highs as my top fib level.    Fibs aside, there’s additional support $5.00 lower at $40.00, where not coincidentally, the long-term rising uptrend line is currently in residence (orange line).   So my advice would be — don’t go “all in” at $45.00 — make sure that support holds first before committing total funds.   This is only prudent management.    The good news is, we’ve already visited $45.00 once,  so if CHK can make a second visit to that level and rebound nicely, you’re even better off with your gift from Senor Fibonacci.  

Buena Serata!  

 

 

 

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Greetings all, from the desk of the guy with some 23 PG posts to his name, and who is now looking to at least double that number this month.  “Formidable” as the French say, the same way we do, save in annoying French accent that fucks the syllables all up.

Well, on to business.  I figured that I’d try to “mix it up” a bit with humor, politics, stock picking, etc.  I know some of you are just here for the last, so I’ll try not to get too far afield.  But it is the weekend, so I figured I’d start out with a humor piece related to a subject I’ve been thinking about for a while.

As many of you know, I’ve been here for almost two years now, and as much as I love Fly and his co-bloggers’ great insights and witty commentary, I also love the little “Fly-munity” we’ve built here, if you’ll allow me the neologism.  

Over a period of time, I’ve begun to build pictures in my mind of the people with whom I correspond, and this in turn has spurred my envy of Fly’s “avatar anointing” abilities.  Upon being given this broad opportunity,  therefore, I decided that I’d attempt to do some character studies on some of the more frequent iBC commentators and peanut gallery bloggers that I’ve come to know… complete with Jake-atars! 

I’m not going to do this in any particular order, and probably not all at once. 

(Update: No, definitely not all at once. )

We’ll just see how it goes.  Keep in mind, these are only my impressions as intuited solely from the commentary I read.  Those described can let me know how close I get… or not, depending on your mood.   Here we go:

The Fly-munity Member:

Boca  (39, Boca Raton, FL): Starting with our one resident woman poster (announced, at least) was a no-brainer.  Aside: Fly’s going to need to up this demographic if he ever wants to sell this monster (that’s the media banker in me speaking). 

That said, Boca can hold her own in this Flymation testosterone pit better than most, and that drives me to the conclusion that she’s a Colombian-American mother of two boys, 16 and 18, whom she had very young after marrying her high school sweetheart.    Being pitted against three men for the greater part of her adult life has honed both her maternal instincts and her socialization skills to a trading “edge” so sharp she could take a first day board of trade seat up in Chicago next to Gappy and de-bank him on a soybean contango trade before lunch time, then bake him a soybean and cheese brioche in consolation. 

No offense to Gappy, of course.  

Boca prefers to stay in Boca Raton however, to keep an eye out for her men, who are almost daily bombarded by an increasingly high quality list of dangerous South Beach Latina hotties, a class of beach vixen traditionally known to be deflected only by “la Madre Fuerte.”  Besides, the weather is better there.

Something you maybe didn’t know: The Ebay stuff is just a hobby.  Boca’s main bank comes from her primary ownership in the largest car wash chain (219 units and counting) in Palm Beach and Dade Counties. Boca’s Wild West Wash  was a business she started 18 years ago with her husband after he lost his bank manager job in the S&L Meltdown of 1990. 

What’s more, Boca got her fabulous start in this business as well as the major coin for expansion, by putting on her marketing hat, grabbing her sponge and bucket, and manning her first unit personally– in the appropriate Western-themed attire.  My “Jake-atar” for Boca was salvaged from footage of those early days in the business.  Can you believe she was pissed off at her husband for taking this pic at the end of the day, and before she could “get her hair fixed?”

Selected Jake-atar:

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