Weekly Market Assessment
Push it to the limit! Today, we got the news that Shinzo Abe, Japan's Prime Minister (Abenomics), much like our former Federal Reserve Chairman, Ben Bernanke (Helicopter Ben), has dissolved Parliament to further pursue "his extreme" monetary easing. The printing of money to devalue your currency and attract outside investment is on! Japan has been fighting for over 20 years the evil economic battle called deflation and is now willing to flood the market with a cheap currency (trying to create inflation) that will attract a stronger currency and create growth! However, the "new fade" with every Central Bank today is to do the same! The race to the bottom is on and for now looks to be acceptable to the market. The U.S. dollar has benefited from all this even after our own attempts to devalue our own currency through quantitative easing! How is this possible and when does the market say we've had enough? This week marked the 5th straight week of positive gains in the market! Year to date; we are up over 7% in the Dow and 11% in the S&P 500! This comes after the mid October sell off/panic, where the market corrected by 9.9%. We have also had 26 consecutive days with new highs! This seems to be the story of the year and is something that is mentioned almost every week! We begin to complain and become complacent when the market behaves this way, then become scared when the market corrects to our request. The market climbs a wall of worry and this continues to be the excuse to keep investors out of the market as we trade into new highs. Gold is at lows not seen since 2010 - stocks are at all time highs - the dollar is at a 4 year high, while interest rates remain at record lows! Have we reached the limits yet? One thing is for sure, "markets can stay irrational longer than you can stay solvent" John Maynard Keynes.
The Rant: Going Off on a Tangent with My 2 Cents
Nothing this week
Making the Watchlist: Below are the stocks that I will be looking at over the coming months. I will provide the the current stock price and why I am watching them. I will comment on them as I continue to keep an eye on them. You will be able to see and follow their growth and/or decline. Chart links may be attached.
PureFunds ISE Cyber Security ETF (HACK) $25.85-This is an exchange traded fund which means it bundles a group of common companies into one security. I can now buy 10+ internet cyber security companies for one price and participate in the overall movement in the sector. This just went public this last week and holds 4 internet cyber security companies that I follow.
From the Trading Floor to the Option Pit: A quick look at whats on the trading desk:
S&P 500 (SPX) -No Trades
SPDR S&P 500 EFT (SPY)- Follows the S&P 500. Traded in and out of these positions on any gains for a total weekly option gain of 11%. I have again bought "PUTS" at 206 and 206.50.
Globalstar (GSAT)-provides mobile voice and data communications services through satellite worldwide. This has been surrounded by controversy as to it current valuation and it potential spectrum valuation. I have traded in and out of this position for a 5.7% weekly gain and now hold a long position at $2.71. The CEO has as of this week come into the market and purchased over 1 million shares in the open market not through grants, while also being granted over 5 million shares as well. If he is buying in the open market, I am willing to hold and keep a short term long position in these shares.
Continental Resources (CLR)- I have sold out of this position at 56.50. I entered a long position and also put this on my watchlist at 51.55. I had a 9% gain as oil caught a bid last week.