18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
19,996 Blog Posts

Last Chance to Kill a Bear

With the earnings season kicking off tomorrow, I suspect the market will rally today.

However, should [[AA]] report a bowser number, look for the indices to go right back down.

Aside from the numbers, another problem investors face is the fucktardedness of analysts, who will be rushing to downgrade the stocks they cover. Call it “PE compression.”

Essentially, most analysts do not have recession baked into their models. Therefore, in order to avoid looking like stupid cupfuckers, they will all rush to “price it in,” sometime this week or next.

In the meantime, enjoy the bounce–for it will be short lived.

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Fly Buy: DUG

I bought 5,000 shares of [[DUG]] @ $38.29.

Disclaimer: If you buy DUG because of this post, you will go bald. And, you may lose money.

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Eminem: Murder Murder

[youtube:http://www.youtube.com/watch?v=b6u7Q6VOC0s&feature=PlayList&p=8AF18B710B3DB739&index=23 450 300]

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The Bottomless Bottom

Much like 2000, this market is unable to find a bottom, as investors reel from staggering declines in momentum and “value trap” stocks.

When investing, it’s important to look at the underlying business of the stock you are buying, instead of stupid lines and dots (charts). The question you need to ask yourself is: will business improve or deteriorate?

For example: one of Apple’s suppliers is citing a big drop in orders from the iPhone fuckers, due to taking a “conservative view toward macro economics slowdown.”

Now, I’m long [[AAPL]] and love the company; but there’s no fucking way I’m buying it higher than $150.

With regards to [[MVIS]]:

I am using this spike in volume and price to reduce my exposure to small cap/unproven names. In bad markets, story stocks get the “homo-hammer of certain death” daily. Keep in mind, all the CES hype will soon be a memory.

Finally, I’m leaving early today, due to a celebratory event. I am quite pleased with my market positions, especially my shorts.

Are you?

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More Pain Coming

Longs are unnerved by the breakdown in key momentum names and have begun “selling it all.”

Keep in mind, fund managers HAVE to raise cash, in order to balance risk.

With the market failing here, I think it’s safe to short stocks, via [[FXP]], [[EEV]] and my favorite [[DUG]].

If a naval clash with Iran can’t boost oil prices, nothing will. Just so you know, being long DUG gets you short [[XOM]], [[CVX]], [[SLB]], [[MRO]] and [[COP]].

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How to Play the Bounce

Part of the problem with “playing a bounce,” is picking the right stock(s). In the past, prior to acquiring space ships and other “new age” technology devices, “The Fly” would occasionally pick the wrong stock—essentially fucking up the “oversold rally bounce.”

As you know, nailing short term bottoms can be sweet. However, buying the anomaly, or the only God forsaken stock that stays down on a bounce, can drive any investor to mental instability.

Some people go long the index’s, via [[QQQQ]] or [[DIA]]. However, I think buying index ETF’s is plain ol’ vanilla gay. Instead, for a bounce, I like focused ETF’s, specifically [[ROM]].

ROM is the Ultra Technology Fund, which is most heavily weighted in [[MSFT]], [[AAPL]], [[CSCO]], [[GOOG]], [[HPQ]], [[IBM]], [[INTC]], [[ORCL]], [[QCOM]] and [[DELL]].

Barring a notable blowup, on a bounce, buying ROM will almost ensure participation on the upside.

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2007’s Winners Starting to Lose

Ok, now we have an unraveling of solar burrito stocks.

With big breakdowns in [[FSLR]], [[SOLF]], [[LDK]], [[CSUN]], [[STP]] and [[CMG]], it appears the bulls are losing faith in its rubbish.

However, much to my chagrin, Chinese stocks are somewhat bullet proof, bouncing in today’s queered out tape.

On the downside, we have breakdowns in energy and other basic resource names, such as [[RS]], [[SCHN]], [[BOOM]], [[CLF]], [[X]], [[HOC]], [[TSO]], [[VLO]] and [[SUN]].

The way I see it, we are due for an oversold bounce, but key leadership names have shit the bed. So, with that being said, I want to sell into this small spike and set up for the next leg down.

On the upside, [[NTRI]] is killing the shorts, alongside [[WBD]], [[MVIS]], [[GILD]], [[JWN]], [[STJ]], [[LLY]], [[MO]], [[NIHD]], [[SNE]], [[BG]], [[SHW]], [[CL]], [[HWAY]] and [[ABT]].

Finally, [[RIMM]] is touching down on $100. While it’s tempting to reload and buy some more RIMM here, for now, I will hold off—waiting to see how the general markets pans out. Plus anyway, “The Fly” is waiting for small Iranian boats to get nuclear bombed out the water.

NOTE: With oil breaking down [[DCR]] and [[DUG]] look great here.

NOTE II: [[CROX]] looks like a small bag of garbage.

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LFC Lock-Up Due to Expire

According to an SEC document from January of 2007, a fuckload of [[LFC]] stock will be “unlocked” for sale, starting this week.

Under the A Share Issue, 600,000,000 A Shares that have been placed with the strategy investors will be subject to a “lock-up” period of 12 months from the date of commencement of trading of the A Shares that are subscribed through on-line issue on the Shanghai Stock Exchange; 300,000,000 A Shares that have been placed with the target placees off-line will be subject to a “lock-up” period of 3 months from the date of commencement of trading of the A Shares that are subscribed through on-line issue on the Shanghai Stock Exchange.

The shares coming from under lock-up are overseas, but may still have an adverse affect on the NYSE listed shares.

Within the index tied to the [[FXP]], LFC is the third largest component.

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