Bottoming patterns are easy to identify. I wanted to throw up this chart comparison of the SPY in Jan-Feb against the IBB.
Back in Jan-Feb we ran a comparison against the Aug-Sep bottom as well to teach how these patterns form.
HAGW,
OA
Joined Aug 2, 2009
1,847 Blog Posts
Labu
Oa,
Will After hours still be open today? If so, how do you get in?
Yep, same routine. http://www.ibankcoin.com/afterhours
what time?
We had a free trial this week. Open M-F 4:30-5:30 PM ET.
is it now closed? it was asking for a login earlier.
There was a spot next to that for the trial.
Bugs should be reading Mamis
I keeps it on the hush.
OA,
can you explain what you mean here? Im assuming you guys are referring to PM bugs? Thanks for any clarity.
Bugs bunny. The blog pic.
Oh, hahaha. Thanks for clearing that up OA. I’m a moron sometimes. I suppose this is evidence of serious confirmation bias on my part……I think everything is PM related.
All good. I’m the same way.
Couple observations from the front lines:
1) The most notable is companies that have not borrowed since the Credit Crisis are once again financing capital equipment purchases. These businesses have been financing capital purchases out of cash flow since 2007/2008.
2) Equipment:
*Significant Uptick in Construction Equipment Year Over Year
*Continued strength in Trucking, Sanitation and Rental Equipment
*New Areas: Gaming, Solar, Relocation-related (Office Furniture, HVAC, LED Upgrades)
*No investment in computer hardware or software.
3) Trend towards automation across all industries resulting from higher wages & retention costs
Takeaway:
Renewed business confidence as evidenced by a sharp uptick in lending activity ever since late last year when Congress passed Bonus Depreciation legislation allowing businesses to depreciate fifty percent of the cost of equipment acquired and put in service thru 2017. This legislation is an especially meaningful incentive to small business owners that must invest heavily in capital equipment.
Forecast:
We are on the cusp of a capex boom resulting from the intersection of business in technology across all industries. Labor has become an impediment to growth and companies are looking for ways to increase output with fewer man hours. Companies that make long overdue investments in equipment and infrastructure will be rewarded with enhanced margins and greater economies of scale.
Since the Credit Crisis business owners have learned to survive without working capital and home equity lines from their banks. Very little expansion / business investment had occurred outside of a few select industries for eight plus years. Businesses have been limping along making investments in “need to have” equipment and funding the majority of those purchases with cash.
Since the middle of 2015, the type of equipment being financed and the willingness to add debt to support that investment is a signal that businesses are confident and ready to make the sizable financial commitment towards automation and enhanced productivity.
One of my HF guys was talking to me about this late last year. Great points and observations.
Who are the beneficiaries? Companies like ORBC / SWIR?
Beneficiaries:
Trucking: SWFT, WNC
Rental: URI, HTZ
Gaming: IGT
Sanitation: WM
Furniture: MLHR, SCS
Solar: FSLR, RUN, SCTY, SEDG
Trimmed some profitable long UWTI. I am now about 1/4 position short oil. I believe oil can go down to 35.00 without an over reaction by stocks.
Not a fan of majority of technology companies here — market is selling excess and buying value. FB will soon follow AMZN lower. Long IWM / Short QQQ
Penny MJ stocks getting more love — TRTC CBIS MJNA VAPE
Keep an eye on INSY.. showing some giddy-up for the first time in months.
GLNG following same trend as last yr. Looking good so far. Retace to the 50% fib around 30-32 would be excellent. I’m just not sure it will be in time for my April calls.
I picked up some GLNG this morning just playing the trend…
Looks like there’s prob a decent volume profile above
Fit-Tech companies ripping again today — FIT NKE UA.
Ripping? Not exactly. Also LULU is down 3.5%
I get excited when stocks like NKE act the way they do ahead of earnings — replace the word ripping with outperforming.
There is not a technology component in LULU so it does qualify for Fit-Tech status.
OA, thanks for the free trial last week. It was much appreciated. Lots of great insight.
SQ headed to 20….Jack is Back!
Expecting TWTR shares to follow – liking this week’s 17.5 calls @ .15
Expecting TSLA ramp to continue into March 31 Model 3 Launch. Might sound crazy at the moment but TSLA 275’s expiring next week for under $1.25 are likely to more than double from here.
Who’s holding BABA and watching this ugly ass fade?
✋
That happens when a pocket fills.
VIPS perking up
What’s your price target? 2/22 high of $13.51 for the short term?
Im holding Aprils so have time for it to work out. 2/22 high a good point but would have to defer to OA on a target.
Sold NKE Apr 70 Calls. 4 bagger…