iBankCoin
I turn dials and fiddle with knobs to hone in on harmonic rotations
Joined Oct 26, 2011
3,487 Blog Posts

Coming In Hot

The market is set to open near the highs of last week after a healthy overnight rotation began around 3am. If the bulls are serious about inflicting pain, I’m looking for them to capture 1520 early on and sustain it. That is the land grab required to take this tape on an exploration higher.

I kept my bias lines a bit tight last week to the downside. I gave a general area I wanted to see hold and when we got down to those levels, a bear flag below my bias line had me cutting a few names. In retrospect, and given the tenacity of this Bull Run, I cut the names too early. MOS in particular, I was caught in the rough chop. The trade is not dead. Therefore I’m highlighting a specific level, 1510.50, that I want to see the market close above. If going into the close, we cannot sustain this level, I will reduce long exposure further.

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On Second Thought (Big Trade Redux)

I’m using my time wisely today, taking advantage of this non-market-but-still-work-to-become-better day to dig into the LED players I mentioned last night.  It is one thing to trade these stocks, but it’s another entirely to invest.  I went through the most recent earnings announcements and news stories from the stocks listed in my last post.  What an uninspiring heap of dung these companies are.

Besides CREE, the other names I mentioned seem marred with mismanagement and poor decision making.  $1.3M this quarter in R&D bro, really?  Who got a new Hummer out of that deal?  I’ve seen these types of operations before.  It’s like adding a biotech cock measuring contest to your business model.  No thank you.

If I have to hold my nose and buy one of these ancillary plays it will be either OESX or GTAT.  GTAT has earnings at the end of this month so I’ll be on the sideline with them for now.  Good chart pattern nonetheless.  OESX has new management in place and is curtailing their R&D foolishness.  Considering their leverage and precarious cash flow situation, if they can go ANDRE THE GIANT this quarter and “get it while it’s here boy” their stock could triple.

On the topic of ALB, they are very virgin to the LED game.  They are a huge chemical company and are kind of awesome.  They’re making the high purity metal organic products needed in LED general lighting application.  This could work out really well for them.  Whether or not it drives top-line growth over-and-above the rest of their business seems less likely but certainly possible.  It’s not as pure of a play on LED lighting.

Finally, I want to add PHG to the LED pool.  Philips is a huge patent holder.  They really bother me though.   A big part of what they’re doing is litigious hostility.  They are going to be on everyone’s ass making sure no patent infringements occur.  Obviously they’re doing this because they sell light bulbs, all kinds, to us and there is a huge margin built in.  It feels like they’re protecting their legacy margins by throwing a wet blanket on LED up and comers.  However, they are a big, “safe” play on LED expansion. I would only pay $24.00 for the stock if I was considering an investment.

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The Next Big Trade (IT IS BIG)

I came about this trade in an around about way.  Here’s the story.

I charted and ranked the seven #Japan stocks I’m watching over on chartpin.  Although going over the setups and getting an idea for how they trade, I’m not exactly dropping everything to build 20% of my cash into a basket of three or four ADRs.  However, a few of the charts are offering decent entries and they’re on my radar going into Tuesday’s trade.

But there’s a bigger play that continues to swirl in my mind.  I bumped into a small Italian man at the grocery because I was staring up and doing Rainman math.

I swam like the wind today.  You may wonder how exactly it is the wind swims.  As I sit here, gingery sipping a hot cup of Red Rose, the working man’s tea, I can tell you unequivocally, the wind swims well.  Swimming and pondering the world I could only think about lighting grade LEDs.  All kinds.

Obviously CREE is the best pure play as they drive the R&D train into the future.  They rock.  I took shares long the day after earnings to wet my beak and it’s run 18% since then.  I would like a dip to add.  In the meantime, these ancillary plays are offering ace entries:

ALB isn’t a pure play, but has a horse in the LED race.

LYTS is in a position to crush competitors and drive market adoption of LED retrofits.  They have several décor and signage offerings, but they tend to build out the design updates with LED lighting systems too.  They have proven the cost recapture and savings a business can receive from switching over. Winner.

OESX does high bay high power lighting and other commercial retrofit work.  They offer financing too, LEVERAGE.  RVLT is a similar idea.  Winner.

GTAT makes sapphire and sapphire making components.  The chart shows a possible inverse head and shoulder bottoming pattern.

LEDS is out there, trading in the penny range, but this company is pretty haggard.  Their website has spelling errors on it and could be a joomla template.  Their CEO even won the ASSHATE OF THE WEEK award.  Avoid and let die.

If you own a company and intend on staying in the graces of Premier Obama, an LED retrofit project is sure to keep you safe from drone attacks on your bullshit BMW 3 Series.

Go henceforth to the charts and get in on the LED action.

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Put the Puzzle Together

The buyers showed up again in the final hours today to defend the coveted 1514 level. This time around, the price action formed a picture perfect bear flag on the intraday charts, just below 1514.  If you weren’t a bear up unto that point, it may have been enough to bait you in.  Unfortunate for any overeager bears (or shaky bulls), there was no downside.  Instead we saw a squeeze into the bell.

This was an interesting week as we made our way through the 7th inning of earnings.  Individual stocks are trading all over the place, decoupling from the mild upside action in the S&P.  This is how a healthy market behaves.  Always keep the index in mind, but you must analyze the price action of individual issues.

Major news headlines this week included State of the Union and its minimum wage increase talk, a barbequed cop killer, the complete failure of Carnival’s Triumph, the $HLF meatloaf fight, and a galactic rock smashing into Russia.  No big deal, just another week in the world.  Did I miss anything?  Last summer any one of these items could have cost us 200 Dow points.

This week feels like it had two Tuesdays.  All the puzzle pieces are here.  The three day weekend (from the market, I always work) is an excellent opportunity to regroup and strategize going into the second half of my iBC interim position.  My best ideas come about 15 minutes into a mile swim.  Not at 5pm on Friday.  So I kindly bid you adieu, for king and country!

h/t @dvk1970 for cueing me to the parties responsible for holding up the market this afternoon:

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Mind The Sell Flow

We’re coming under a decent bit of selling pressure as we enter the lunch hour.  Most of my longs are red, but with cash at 33% (oh yeah) and most charts holding up well, I haven’t made any sales this morning.  Should we lose 1514 as I mentioned earlier, and sustain trade below that level, I may take profits and raise a bit more cash.

Not all is weak today.  I’ve been very interested in the Japan trade this year partially by Fly’s highlighting the space, and partially by a few good friends in the country who like the new leadership and their prospects going forward.  Thus I’ve been stalking EWJ, HMC, TM, NMR, MTU, PC, and CAJ.  The Nikkei dipped over 1% last night and these names have dipped as well.  A few of them are offering enticing entries today.  Depending on the afternoon session, I may begin allocating capital into a few of these names.  With the US markets running hot, I may allocate up to 20% of my capital into these names.  These ADRs do most of their movement overnight, so swing trade is really the only way to trade them.

Let’s see where this selling takes us.  I’m laying off the throttle a bit.  I went hunting for stock picks last night and this morning, but nothing is matching the picture I want.  Chinese burrito HTHT looks decent.

I cut GNRC yesterday at the close (aka low of day) and when I saw the Goldman downgrade early this morning I thought I made the right move.  Shares are up almost 5% and I think this stock is still a winner.

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Dealing with a Monster

My brain got in the way of me trading yesterday.  I’ll go into further detail this weekend.  But first we must take our places for the finale of this week’s market.

Since gapping higher last Friday, the market has done very little exploration, however there is little occuring to make us bearish.  We had a methodical seller Wednesday, but no follow through. We’re above the midpoint for the week and value has progressed higher (albeit at a slow rate) the entire week.  I’ve highlighted the value progression in orange.

1514 was the floor during the globex session and has been a price that finds buyers all week.  Losing this level today could signal the buyers active this week are removing risk going into the weekend.  However, if the S&P closes above 1514 bets are being pressed.

The Nikkei was off over 1% overnight and our futures couldn’t press through this level.  Don’t you want this market?

BOTTOM LINE: WATCH 1514 on the /ES

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Follow The Sunshine

Today the weather in Detroit is a special kind of bleak where it rains all day but it’s too cold to melt the snow.  It is the magic of pure Michigan in February.  I’ve seen February days more dreary then the line outside the 36th District.  Today ranks top three dumpy days.

So what can one do to lift the spirits and remember the sun?  Exactly, bank coin in solar stocks!  The sector is on a tear today.  There’s a whole political theme behind these names, but you’re better off pulling up the price charts for these names and sticking with the biggest winner.

I’m currently long FSLR, and after getting rolled on yesterday, it appears the damage never happened.  It was fake.  Coin can continue to be banked in these names.  Don’t chase anything, as the names are volatile, but keep them on your radar this quarter as the sector is running.  Considering February is traditionally a weak month for the industry, this action suggests an unseasonably strong appetite for solar stocks.

Other names I like: TSL, SOL, JKS, and GTAT (which gets a little LED play too.  Unless LED makers abandon sapphire, which they might)

UPDATE: I stole this FSLR chart from Elizamae’s archives, note the dick guillotine:

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High Water Marking

Indeed a Happy Valentine at the house of Raul3.  The big move in ANGI has taken my portfolio to it’s highest levels ever.  There’s good action in the socials today, as Facebook looks to be clawing back lost ground.

I took a scale on my ANGI position.  It was only a ½ position going into earnings, and it became over ¾ in size when it rapidly appreciated.  I still hold around a ¼ position in the name.  And like CREE, I’m patiently waiting for a dip to size back in.

While I wait, I have a couple snacks I want to enjoy.  The sellers are backing off the tape today, but I’m waiting to see what the afternoon brings before I put my hard fought gains back to work.

The Debbie downer over here (there’s always one) is GNRC.  They reported decent earnings, but are taking a hit.  I now have a choice, cut the loss on what was a small position to begin with, or size up and get to know the name better.  I’m reserving this decision for the afternoon also. 

Look, 1514 has been a magical line in the market.  If it gets lost while I’m out eating tacos for lunch, things could get slippery.  Obviously the bulls have the trending edge here.  If I’m to press it, I want to see the heavy lifting continue.  Otherwise, this could be a nasty bull trap.

“I want to be rich and I want lots of money, I don’t care about clever, I don’t care about funny.” Lily Allen

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I LOVE SELLERS

Happy Valentine’s Day ladies,

Gentleman, buy something, anything for your girl.  I don’t care if you think the holiday is fake.

Like I mentioned yesterday, we found real sellers working yesterday.  They left their footprint on the profile, where we see the market making three rotations lower.  What impresses me about the action taken by the sellers is how methodical they were.  This was the clever work of an expert or her robot I’m sure of it. Check it out:

As of this writing, we’re trading below Monday’s pump range around 1514.  Turns out the level didn’t give us much pump in the S&P, although it allowed individual equities to rip higher.  Given yesterday’s profile and the selloff during the globex session, I’m turning my attention to a downside scenario today.  The overnight low sits at 1510 which is right where things get slippery.  Should we lose that level intraday, I’ve boxed the area I want to see price sustain to keep me constructive on my solid long positions.  Should we begin trading into this area, I may scale profits in extended names and cut small losses before they morph into large ones.

Below 1504 today, and a major sentiment shift has occurred.

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INTERNET FTW

Holy earnings blow out.  Look at our newest enterprises, wowing the street with hot numbers.  Zillow and Angie’s List are ripping afterhours, partially because there’s a housing resurgence, partially because they’re the way of the future, the future, way of the future, ehm. Future.  Howard Hughes (HHC) ripped all day.  That was my tribute to the aviation legend.

Fly pens posts like ‘The Amazing Market’ that get me so pumped to bank coin I have to sit in my car for 10 minutes listening to classical music so I don’t put my head through the windshield like Busta Rhymes the first time he heard Eminem.  Get excited people!  These rip-tastic days are numbered.  You need to, “get it while it’s here boy.”

Every time I upload a blog post I feel like I’m a member of the future society.  It’s never a burden.  Just as many Americans enjoy a fecal cruise, I enjoy typing a message to the world then permanently etching it into the archives of the greatest website on the internet.  Future.

ZNGA, Z, YELP, FB, TRIP, OPEN, ANGI, LNKD, take your pick.  One of them is going to double.  Stick to the charts and you can ride along without getting castrated by the inevitable loser.

If you can’t allocate risk capital into this space, you’re bound to miss out.  I’ve been beaten with a dough roller by YELP once.  I cut off my right pinky as a reminder to stay humble (kidding).  But know what type of beast you’re dealing with.  Know the range volatility and position accordingly. 

One can only lead a horse to water.  You best take a drink before Elizamae makes you his main course.

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