General Information and Analysis
Warren Buffet: “The best way to
minimized risk is to think.”
US
Comment for 12/26/2013
|
Measure
|
Indicator
|
Ranking
|
Weekly RSI
|
WeeklyRSI
|
73.5
|
OverBought
|
Long Term MVA (200 day MVA)
|
200 MVA
|
9.96%
|
Bull
|
5 Day Slope of 55 day MVA
|
Slope55MA
|
0.65%
|
Bull
|
Intermediate Trend (Using ADX)
|
ADX(14)
|
20.3
|
Bull
|
Short Term Trend (Daily RSI 3)
|
RSI(3)
|
85.62
|
Overbought
|
Relative Volatility (ATR% vs StdDev over last 90 days
|
ATR(90)
|
.78%
|
Normal
|
VIX - MACD 10/30 (slope down)
|
MACD
|
-0.053
|
Bulll
|
The USA stockmarket is bullish, with very short term indication
on S&P emini of overbought.
|
The table above is a rating for intermediate and long term
trend in the S&P500. I used the
S&P 500 as the indicator for the USA stock market. For day traders: You may find it useful to
trade in the direction of the trend.
However, looking at any daily chart over lots of years, the trading
direction for the day is pretty random.
S&P PIVOT ES Mini - Friday - Useful on Monday 12/23/2014
High
|
1838.50
|
Low
|
1833.50
|
Close
|
1834.75
|
R2
|
1838.00
|
R1
|
1840.75
|
Pivot
|
1835.75
|
S1
|
1833.00
|
S2
|
1830.75
|
Stocks –
Zeb’s View: Basically, the stock market is rising,
period. Fueled by the Federal Reserve
easy money and an improving USA economy, stocks are poised to close the year
positively. The market is on track to
close the best year since 1995.
Private Equity firms are setting a
record for the best returns every surpassing 2012. The sector has been assisted by low interest
rates. Blackstone (BX) and KKR (KKR)
have some of the best performance numbers ever, and they were certainly
assisted by low interest rates in buying up homes, fixing them up and renting
them.
Small companies sentiment is
bullish. That is amazing as we own
several, and it has been a difficult year with ObamaCare uncertainty, lack of
liquidity available, and prices rising where the business cannot raise the
prices as the large companies have not raised their prices. Reuters ran a survey 75% of owners said they
expect sales to improve in 2014. At the
same time the small-business “confidence index” reached an 18 month high of
108.4.
US Budget...
China
Gold:
US Budget...
From the beginning you know I've
not been excited by the budget deal. The
Bipartisan Budget Act of 2013 is ludicrous.
CBO (Congressional Budget Office) announced the budget will save $23
billion dollars over 10 years. This was
met by the media (and most Republicans except Paul and Cruz) as wonderful
news.
Put the reduction in perspective,
and possibly you will see the Republicans drinking from the same Kool-Aid
bucket as the Democrats. Drum roll from
the marching band, please! The $23 billion
will reduce our estimated growth in debt by .00363 or 1/3 of 1% . OK, as I'm writing this, I have to get up and
bang my head against the wall.
OK, I just remembered that the
Feds are tapering (reducing liquidity), GDP is growing, and the world is rosy
(unless you run a small business, and apparently most of those people don't
have my problems.)
Having stated the positive,
however, I believe the Fed's tapering will not last long, and they know
that. The people at the Federal Reserve
are very smart, and I believe they are fully aware that US economy (and the
world economy) is addicted to stimulus.
The USA nor global economy can stand for long without stimulus. When the pain form tapering is obvious to
everyone, the Fed Heads will have to step back into the ring, and purchase
bonds in large amounts.
China
Did you see the reports on China's
debt yesterday? China for the first time
ever printed their Government debt totals.
China's National Audit Office (NAO) announced yesterday that China's
total government debt (including both central and local governments) amounted
to RMB20.7 trillion as of this June, equivalent to 40% of China's GDP. However,
including contingent liabilities, China's total government debt would exceed
RMB30trn, or equivalent to 50-55% of China's GDP.
Dear Reader: It is my opinion that
if this information is accurate (and it is as accurate as governments anywhere
else) then China's debt is not a problem.
If only the USA and the Eurozone had China's liability as a percentage
of GDP.
Not only that, China holds a
Treasure Chest of reserves. That chest
exceeds $2T dollars.
Compare that to the Trillions of
Dollars the US is going into debt with no known reserves at all, then the USA is
in sad shape to be a competitor with China in the global market place.
This was interesting. Zu He Liang China's director of Chinese Gold
Market Research Center gave a speech.
"Due
to the fact that entire world is paying close attention to the price of gold
shows that we are all pursuing a "World Dream". The "World
Dream" is nothing but a pursuit for world peace, the healthy and stable
development of the world's economy, and a world which is fair to every country
and its citizens. The pursuit for gold reflects mankind's pursuit for the
"World Dream". Gold represents mankind's yearning and aspirations for
stability, and healthy economic development; it is a wonderful wish."
http://www.usagold.com/cpmforum/2013/12/31/china-accumulates-gold-for-the-%E2%80%9Cworld-dream%E2%80%9D/
Rarely
would a leader of any kind publish or say something that was not approved by
the Communist Party and rulers in power.
Underlying this wonderful speech is the hint that China wants an
international trading currency based on gold.
Gold:
Gold Investors say "Ouch": Gold was way down yesterday, and it is down
well below 1200 on the March futures contract.
Ouch, Ouch, Ouch... Consipiracy
theories aside, gold is down for whatever reasons gold is down.
Gold
miners are in for more difficult decisions as they write-down values due to
plunge in prices. The value of
gold bullion has dropped (as you know), and Gold mining companies face
write-downs due to the drop. The drop
has undermined their economic viability.
Barrick (ABX) and Newcret Mining (NEM) have already taken a massive
write down in 2013 of writing. Barrick Gold (ABX) last assumed a price of
$1,500/oz and Newmont Mining (NEM)
$1,400/oz; Barrick, Newcrest Mining (OTCPK:NCMGY)
and other mine rs have already taken massive write-downs this year.
As you know if you read my materials, Gold and Silver are
recommended as a hedge against world-USA-chaos.
They are not yet in a position to be considered having bottomed. However, seasonal cycles indicated that Gold
and Silver could have a considerable rebound in the 1st
quarter. The rebound could be profitable
on a very short investment cycle.
However, a retail investor would have to be very nimble to profit. Look for retail investors to plunge in as
gold looks like a bottom, and then get burned as they have no reasonable plan
how to trade short term.
