Safehaven | Bull or Bear, Frankly my Dear...

October 13, 2006

Bull or Bear, Frankly my Dear...
by Boris Chikvashvili

When making money, should we care?

10/13/2006
OK Our profits are rolling see http://borisc.blogspot.com/.

SPX - 1342 , 1375 resistance, fluctuation away from 1375.
DOW- 11820, 12283 resistance, another 230 points? One good days work
BKX - 114.60, 120-122 resistance, Watch the banks, Virus anyone?
JPM - 48.85 resistance , Ever so close , ever so far?
XAU - 122, 103-105 support, 122 is still holding, like Stalingrad.
GOLD -555, 470 support, So far so good, Vulnerable until Feb 2007.
TNOTE - 4.0 support, yeh, I think very unlikely, holding short durations/insurance
$Dollar - 94, resistance, yeh, very unlikely

For the sake of fairness we should watch our language and state as follows.
As distorted as markets are they toil in cyclical bull market within the context of the secular bear market. Simple enough.

While interesting topic, do we care? Not enough. Our recommendations, in public, have made more money in 3 months then the indices have made in last 30 months. So we know for sure we have the bull market in profits.

Stocks. Please note two proprietary charts. One BUY-SELL-PRESSURE you are familiar with and another EARLYBREAKERS chart.

SELL PRESSURE has retreated from the extreme, while the market was churning (we promised 2-4 days of churning) that in conjunction with a huge breakout in the EARLYBREAKERS for NASDAQ have caused us to remove shorts and sidestep the last rally, http://borisc.blogspot.com. Yeh, you need to learn how to run or the "Suckers" will flatten you. What virus is afflicting the banks? The market is up 2~5% and banks stand still? Are the Brokers only horses left to run? They are within 1-4% from secret resistances (you could obtain those by emailing me). One more, for fractally unchallenged, do you see the small copy of the bigger cup in BKX chart?

Nimble types, sell them using your favorite short-tern sell signals. If profitable, may convert the positions to long-term.

Gold. We took quick profits and let the Gold/XAU take to sideways. Has XAU defeated bears at 122 like RUSSIANS defeated GERMANS at STALLINGRAD? (spike below, but close above). As we indicated Gold could be challenged all the way into Feb 2007, but opportunity cannot be ignored.

Nimble types, hold 50% of previous purchases with the trailing stops as instructed at http://borisc.blogspot.com/. Profitable, now may last a long-term position.

Oil dropped below 60, Ultimate support is at 55. Cannot rule out the 1973 type rocket up.

Nimble types, hold 50% of previous purchases with trailing stops as instructed at http://borisc.blogspot.com/. Some positions stopped out better than break even. Profitable, now may last a long-term position.

Bonds took a hit. If bonds move higher with quality spreads, which, so far, stopped doing that, then look for a crisis ahead?

Hold short duration for insurance.

Dollar choppy, still confounding bears. I am a long-term bear too, but unlike a broken clock I want to be correct more than twice 24 hours. With a weekly buy and daily buy, move up is still possible.

Very short-term players only, are long. Trail stops as per http://borisc.blogspot.com/.

Some sectors, that look good/bad. Incomplete list

Gold stocks, bounced from strong support.
Drug stocks, good long term, many at resistance.
Biotech, good long term, many have advanced from support.
Oil stocks, good long-term, some at support.
Oil/Gas trusts good overall, 2-5 % from terrific support, 10-15 yields!
Pipelines, not at support, but can you give up 7-8% yields? Gas price do not matter?
REITS, disaster waiting to happen, at historic resistance levels 2-5% yield!
Banks/Brokers, can they save/sink market. Last horses running. The 30% of S&P. Will BKX fractal crumble. See the fractals at BKX chart on your favorite site.

Long-term portfolio:
Cash/Short term Bonds - 60%
OIL/GAS Trusts/Piplines - 30%
Gold - 10%

Bottom Line. Enjoy our analysis and support/resistance numbers.
The markets will, often, turn at those numbers, but it takes a short-term system perfection to take advantage of these turn-around/drill-troughs.
Some of them will be short-lived and some will make a fortune if let run.
We got it down close to perfection.

Boris Chikvashvili
borisc.blogspot.com

In short... I was supposed to be a theoretical physicist (Russia+Jerusalem Hebrew University, MS Physics, with distinction, toyed with QUARKS). Somewhere on the road to PHD I have discovered, first the Computers - at Carnegie Mellon University (MS EE, Fathered UNIX, adopted WINDOWS), and second Finance on Wall Street.President ITI,(Computer/Finance Consulting Firm) Consulted AT&T,IBM,SUN,CITIBANK,JP MORGAN, LEHMAN, MICROSOFT. Designed/implemented Trading Systems - BLOOMBERG LLP. There is nothing more to say professionally speaking.

Please Note: The opinions expressed here are only for education purposes and do not constitute the advice in any shape of form.

Please note, we provide consulting services in Trading Systems Programming (BLOOMBERG/ TRADESTATION/WAVE59/EQUIS any/all others), Trading/Econometric Model Building, Trader Training, Technology ( Tele/Data Com, Programming C,C++ etc). DataProcessing Center and Internet Serivice Setup/monitoring etc. Also daily Attraction Point ( Potential turning point ) Alerts for number of Stocks/Futures of your choice. WriteTO: bchikvash@aol.com Dear Friends, Our relationship? no change.