Some asked about short term trading the Dow futures (or in using the ETF) I use
a combination of Bollinger bands, RSI and stochastics and here I show a
15-min chart to illustrate it and only used the stochastics and bought when they
moved from under to over 20 and sold and went short when they went from over 80
to under 80. (I show some dotted lines as actual buys/sells would depend on if you use 80 or
maybe 75 - the B-bands and RSI would have helped decide but here the solid red
and green lines are the ones we used to see if you would have made money using
this automatic system this week. - (I am not showing any stops in this example
and in reality you may have been stopped out if you used any - though you also
may have re entered at a better price)
Go short Monday afternoon at about 13445.
Cover and go long Tuesday Morning at about 13345 (profit 100 points)
Sell and go short at noon at about 13400 (profit 55 points)
Cover and go long in the afternoon at about 13330 (profit 70 points)
Sell and go short Thursday near noon at about 13410 (profit 80 points)
Cover and go long late Friday at about 13320 (profit 90)
Total is 395 points and only trading an e-mini that pays $5 per point the profit
is $1,975 and you had about $1,800 tied up so doubled your money.
(as I have stated of course you need some kind of stop but we also are not
showing the other indicators. Just thought this would be an interesting example)
I read that seasonally the first 4 trading days of July during the 3rd
year of the Presidential Cycle have been one of the strongest weeks of the
year. Since 1931 the S&P 500 has been up 89% of the time with an average
gain of over 1.5%. Hope we do the same on this holiday week.
The Dow closed about even for the week but did test the early June low
and the 50-day with passing grades.
The Nasdaq tested the 50-day and trend line and was a success
this week and ended with a 1% gain. If this can make a new high in
the next couple of weeks it may put in a top for the summer and we
will watch a shorter top trend line (not shown here).
S&P 500 back above the 50-day EMA and support.
Not any comment on the Russell 2000 as it is about unchanged
for the week though it is still above the 50-day EMA.
The Nasdaq is outperforming the S&P 500 enough so that this ratio
chart has the Nasdaq breaking above the trend line. This suggests
another Nasdaq rally ahead.
While the Nasdaq is out performing the S&P 500 the BPCOMP is again
below
the 20 day EMA and falling. I cannot explain why we have this divergence of
indicators at this time but it does point out uncertainty in the markets as well
well know anyway.
The number of stocks on the NYSE above their 200-day moving averages
back to the lower range of 2007. A break here would suggest a more
significant market pullback. The lower part of the chart is the
NYSE.
OIL again this week broke out to another level over $70.
The yield curve was quite extended last week so now for the
time the 10-year and 3-month are coming closer together as 10 in
this chart is paraty.
The 30-year bond yield fell back down to test the top channel
line at 5.126%.
The US dollar ran to the trend line and failed so looks like it is trying
a bottom retest.
This monthly chart still shows
the Dow outperforming Gold. Stochastics are now over 80 but
will likely stay a while.
GOLD - the stochastics
have dropped below 20 and gone above but the short trend line needs
to be broken I think to make it a trade.
For 10 months the Value Line
put in green monthly candles - June was in the red. Not sure we will
ever see a 10 month run like that again.
NNRF First, we know the company has
done one acquisition and is currently in 3 more and we think
there will be others as they expand their holdings and revenue
streams. As they may pay for these with shares or a mix of shares
and cash this can often bring up questions of dilution. Here is
a comment I posted about that subject:
Generally
dilution is the same amount of income but more shares so the income
per share is diluted. Example would be if a company had to issue new
shares to raise money to build new offices. In the short term at
least this would not add to earning but increase the share count so
would dilute the current earnings per share.
If a company issues more shares yet increases the income
sufficiently to increase its income per share (including the new
shares) it is called accretive.
NNRF had small income at the time it paid $2,165,000 in cash and
four million shares to buy 50% of ATOLL. ATOLL in the last
quarter reported a margin of 26%. They have a sales book now of
about 200M so if they keep the same margin that would be $62M in
gross profits and half to NNRF. This is only an example but you can
see that even if they had to issue new shares it sure would not have
been dilution but accretive.
NNRF now has 3 acquisitions on the table and all of these companies
are making money so I believe they also will all be accretive to
earnings per share and not dilutive. If ore acquisition come, and we
hope they do, we would expect the same salutation and for them to be
adding to earnings.
The reason a company goes public is to be able to use shares to
expand. ORCL has 5 billion shares MSFT has 9 billion. Both companies
used shares to buy other companies so they could grow and increase
earning and shareholder value.
So more shares if used properly, like they were in the case of
buying ATOLL, is exactly what shareholders want as that is real
wealth building.
It has another value also and that is to increase the float as when
NNRF gets listed on the AMEX and AIM and perhaps other exchanges it
will surely have to have more floating shares for larger funds and
other institutions to take good sized positions in the company.
We also well know that ATOMPROM is on an acquisition hunt to buy up
as many companies it can to put under its umbrella. It seems to me
that at some point owning many companies in the nuclear field will
put NNRF in a very good position in more ways than one.
Technically the stock chart is now running out of room in this tight
pattern so we expect a break to the upside very soon. We have heard
from third parties that the company's road show was very successful
with verbal funding commitments for any of the company's acquisition
plans. We would double our positions here or at least on a break out
just over head. We also expect a very strong month for the stock.
You remember the rule of 10 says that when a stock breaks $10 for
the first time it almost always will pullback under $10. (we
mentioned to watch for this when the stock was going up the first
time and just over $8 so many of you took profit then and have now
bought back) This rule then says that the better buy for the long
term is on the second close over $10. Obviously we are buying in
advance for this coming event.
CYRX As we noted in our Wednesday
morning video it was a time to buy CYRX if you did not own it and to
increase positions if you did. It added about 35% since then and is
now back above the 50-day EMA. People who watched the prices on
Wednesday noted that the price stayed pretty tight for a while in
the $1.25 area but then the ask jumped to $1.60. This is what we
have seen many times in this stock and why we had been saying that
it was a good one to have been buying on weakness as it pulled back.
They still await the next answer from the NASD on if they have
finished the comment period and can move to the OTC or if there are
any more questions. This process will for sure end but we cannot
know if it will be this week or not. The trading this week showed
how many have been sitting on the sidelines and are ready to jump
into the stock quickly. You can see that the MACD histogram is again
above the center line so if you need more shares watch for any intra
day weakness.
CFPC Coffee Pacifica also hit support
this week at the trend line, the 200-day EMA and the 62% retrace so
we pointed this out in the morning video and it made a good rally.
Most of you know about the typical 50-200 pinball when a stock has
to bounce a bit before breaking out. It bounced from the 200-day ran
to almost the 50-day and bounced back down. It does not need to
touch each time like in the pinball games but it often acts this
way. The Stochastics have moved back over 20 so in a buying time
now.
NPWS this as you
know is more for shorter term traders as the company plans to show
its prototype battery at the end of the month. Of course it may
become a long term trade later depending on the outcome later this
month.
PYR.v Trades on the TSX Venture exchange in Canada so you will have
to check with your broker as to the symbol they use for it. It is a low volume
stock and having orders in place can help to obtain stock on weakness.
The properties purchased in April
added significant cash flow and this will become apparent when the company
issues its next quarterly statement. The company is planning a road show to
increase it's shareholder base. This was our
special report
earlier.
Here is a trading idea. This is partially based on the
chart
as it has made a base at the $1.10-$1.15 area above the
50-day. It has had some very significant volume spikes in June. The
company is Raven Gold RVNG. I do not know the company and do
not own the stock but have heard that a promotion may take place in
the next couple of weeks so passing this along for you speculative
traders.
The earnings calendar from Briefing.com
CTHR over $5.00 and the 50-day EMA
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