My Stock Market Rantings - 2003 Market Bottom or 1930's Crash?
I've been studying a few stock market charts lately. One showed DOW 1930 and 2009, suggesting we are but 50% through at best but that assumes this recession becomes a depression and it doesn't look like that's going to happen.
Charting the FTSE depends on whether you see a comparison with the 2003 bottom (in which case bottom is in) or whether one sees a downwards channel. Both visions are there. There is also an EW vision that has us in a super-cycle with far worse to come. What's in front of us, however, is a rather resilient FTSE, which has both RSI and MACD close to painting buy signals. This is all a bit frustrating and probably should be ignored.
This could be the right moment to put fundamentals priority over technical analysis. Accumulation now of good stocks could pay dividends later. I am now off highs, having taken the view that I will stand a little pain along the way. I'm not selling ALN or MML (until gold goes sub 900). I have a target of 27 on my ATD, 6p on my XTR (high risk bit of fun). I have also opened a position in ITL, target 90p-£1. I have bought a few CYH, stop 30. I continue to hold TEP, up because ex-dividend tomorrow...don't forget it will fall on ex-dividend day, just like it did next time.
I also took a look at VLE yesterday liked what I saw. It appears to be in a prime position to benefit from hard times and claims to have net assets of 320p vs. a share price of 247p. The spread is however horrible and the market makers only do 500, so I've bought 500. No stop for now, target 300.
Favourite CRYO continues to fall, I am looking forward to buying it back.
PURE heaves down after Simon Cawkwell called price beyond probability; we shall see. I expect to hold that one again.
EDD slips, another one I shall enjoy buying back.
Talking of fundamentals, Zulu Principle and Beyond Zulu Principle are both excellent reads. I now always use rolling p/e so that I can compare apples with apples. Slater is buying EDD by the bucket load. At his talk he said he only watches circa 30 shares. I remember him saying that and then the first question from the audience was asking for his views on BARC. He looked directly at the person and said something very much like "and what part of 30-small cap shares did you have trouble understanding". I would certainly turn out if he does another talk.
I've also had a month's trial to Secker's live trading. Lots of good trading ideas but at prices we mere mortals were about as likely ill-afford. I don't see how a subscription live trading service can possibly work. Think about it, if we all bought EDD at the same moment how many of us would actually get the price? That's true all the way up to FTSE.
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