Monday, August 25, 2008

U.S. Natural Gas and Gasoline Funds

The US Natural Gas fund, ticker UNG, (chart above) is worth keeping on your radar. I realise we made a slight new low today, on an intraday basis mind you, and closed above that. As my notes indicate, a move above $39.15 is necessary for UNG to get back in bullish mode. I have hi-lited "the box" which you will recall is the 50-62% retracement area of the immediately prior move, here it was the Jan-Jul move from 33.50-63. We have clearly blasted thru this box. Now you can see why, in my world price is paramount as this stubborn adherence to this indicator would have crushed you beyond words. UNG is atop my watch list currently.

The US Gasoline fund, ticker UGA (chart above), is a thinly traded vehicle and had a nice pop last week which it is giving back. Lets watch to see how far this corrects and if the $52 level can hold on a closing basis.

I don't know how many of you caught this news which came out over the weekend in which another bank was shuttered, Columbia Bank and Trust of Topeka Kansas. I realise you may find it shocking that pompom TV(CNBC) either doesn't know the bank went under or refuses to share the news of the story. This is completely understandable given they have allocated the bulk of their resources to hyping a bogus story surrounding a Korean bank wanting to buy Lehman every quarter hour. I trust you are starting to see a pattern here with regards to mainstream financial media.

I continue to strongly recommend the blogs listed further down on this page as regular reading. They are providing "the real skinny" on what is going on in the markets as opposed to the cheerleading charlatans on CNBC. I am at the point where I feel sorry for the likes of Vince Farrell in whose world everything is a buy. To his credit, its not his fault, for he is a product his environment. You want to stay employed on Wall St. you better be bullish. He also had quite a bullish wind at his back for the better part of 2+ decades. At least Peter Lynch of Fidelity Magellan fame was humble enough to give credit where it was due and acknowledged he had the good fortune to manage money in a great market. But I digress..... yet again!

"Are the financials a buy" day after day after day, is what seems to count as financial reporting on CNBC. That alongside a healthy dose of rumor mongering and I would counsel Jeff Immelt of GE to dump the unit ASAP while it is worth something before the bear market leaves it in a worthless heap.

Good speculating to you all and never ever forget that "an investor is a speculator who made a mistake and will not admit it".

Open Positions:
Long 2 units of Powershare Agriculture ticker DBA @ $35.35 stop $34.79
Long 2 units of XTO Energy ticker XTO @ $45.40 stop at $44.48
Long 1 unit Currencyshare SwissFranc ticker FXF @ $92.70 stop at $90.68
Long 2 units Ultra Oil & Gas ticker DIG @ $84.65 stop at XLE $71.93
Long 1 unit U.S. Oil Fund ticker USO @ $96.95 stop at $91.38
Long 2 units Ultrashort S&P500 ticker SDS @ $64.65 stop at SPY $130.58
Long 1 unit Oil Service Holdrs ticker OIH @ $186.05 stop at $177.64
Short 1 unit Int'l Bus Machines ticker IBM @ $129.05 stop at $128.56
Short 3 units FedEx ticker FDX @ $87.10 stop at $88.16
Short 2 units of Apple ticker AAPL @ $178.05 stop at $182.76
Short 1 unit Blackrock ticker BLK @ $218.50 stop at $218.126

No comments: