Wednesday, July 11, 2007

Stop Calling me That !

I am not a perma-bear... I am not a perma-bear..... I am not a perma-bear. Ooops sorry, thought I was still in therapy session. I am taking a page out of the "I'm in denial about my position" play book. Just find any excuse, like excuse# 472 it was upgraded today by a tier 1 Wall St. house. Or the excuse # 237 that the merger they announced has 'synergies'. Or one of my personal favorites, excuse #104, that it was down on lighter volume. Mr. Wohanka used the old reliable excuse # 54 I'll hold it to maturity, which I haven't heard in a while due to the persistently falling rate scene.

Richard Wohanka, chief executive of Fortis Investments, one of the largest CDO managers in Europe, said risks had been overstated. “The press has gone berserk on the CDO sub-prime debacle. A CDO is a highly illiquid bond and the premium on pricing is the compensation for the illiquidity. If people buy the CDO to hold it to maturity, it will pay out. However, if you have to sell you will probably suffer,” he said.

WOW ! Denial is not only a river in Egypt. I wonder how he will feel in a couple years as higher rates hammer his positions. Does he really expect us to believe he would hold these to maturity? I hope Foris' pockets are deep enough to ride it out. Maybe he was convincing himself. Reminds me of the portion of Michael Lewiss' Liars Poker when the Euro fund manager asks "what iz de price of de bonds. .... ahhhhhhhhh ! Dollars to doughnuts his comments appear in the 'letter to shareholders" this quarter !

As for me not being a perma-bear, I thought I would enclose some good looking BULLISH charts today ! So here goes...

Silver Wheaton (SLW 1st chart top) broke out of a bullish ascending triangle thru $12 that is worth about $5 so we should get a move to the $17 area. A pullback is expected so don't chase this.
Natural Gas Services (NGS 2nd chart) nice rounding bottom formed. First break out was thru $15.50 this pullback has been on nice light volume consolidating its run up. A move thru $20 says the race is on again.
Agnico Eagle. (AEM 3rd chart) almost a 9 month falling wedge pattern which has resolved itself to the upside. $42 and $46 are the next buy triggers.
James River Coal (JRCC last chart) very nice rounding bottom rally out on volume climax peak and now lower volume consolidation, textbook. $15.50-16 area is next buy trigger although if you argue the pattern is a cup n handle then you could buy $14.40 and add thru $15.50
Good luck and good trading to you.

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