Dollar Collapse Continues

MARCH 5, 2008: Commodities led the way again. The Nasdaq was up 0.6% making this 2 days of gains in a row for the markets. It appears that the index is headed up to test its 21-day moving average at around 2300.

Commodities continued their bull market run with oil shooting up $5 to over $104 a barrel on supply shortages and flat Saudi production. The spike in crude also sent gold and silver up to new highs. Gold actually hit the illusive $1000 an ounce milestone on the June futures contract today. The sinking dollar hit all-time lows again.

Solar, steel, metals, gold/silver, and oil/gas stocks were strong while banks, financial, and insurance stocks were weak.

JA Solar vaulted 9%. Sunpower, First Solar, So. Peru Copper, Suntech, and Yamana Gold gained 5%. Research In Motion lost 3%.

Here are the top 10 leading groups: Fertilizers, Gold/Silver, Oil/Gas Producers, Farm Machinery, Ores, Steel, Solar Energy, Agricultural Ops, Oil/Gas Drillers, and Mining Machinery. We have to ask ourselves if this is really a stock market rally or a commodities rally? Is inflation really taking off globally evidenced by soaring food, energy, gold, and raw materials prices. I think so.

The stock market indexes have tested their down trending 50-day moving averages from an ‘overbought’ position and failed. IBD has now switched from ‘Market in a Confirmed Rally’ to ‘Rally Under Pressure.’ Gold, silver, grains, and oil are all moving higher in very definite up trends. We may be witnessing a ‘disconnect’ between commodities and stocks.

It’s best to stay on the sidelines in stock markets like this and not get sucked into ‘leaderless’ bear markets. Patience, Grasshopper! More at www.goldenticker.com

CNN: The Next Great Depression Is On It’s Way!

Markets Ignore Inflation Report

FEBRUARY 20, 2008: Inflation showed up again today in the ‘hot’ CPI number. In January, core inflation rose 0.4% vs the forecasted 0.3%. Minutes from the last Fed meeting however indicated that the they would do everything they could to keep the economy from going into a recession. The Nasdaq celebrated by rallying 0.9% on heavier but average volume.

Retailers, oil drillers, and steel producers were strong today. Medical related, solars, and automobile stocks sold off. Transocean was up 7%. Research in Motion advanced 5%, and fertilizer maker Mosaic moved up 4%. Suntech Power dropped 12% and Sunpower lost 4%.

The Nasdaq is now 19% off it’s October highs. Stimulus packages, multiple rate cuts, bail-outs, etc. may have brought us a ‘counter-trend’ rally but have failed to change the direction of the markets, which is decidedly down.

Counter-trend rallies during corrections are by no means a signal to jump back in the markets. Bear market rallies can be sharp to the upside and come back down even faster. It’s best to wait for a ‘follow-through’ day and see top-rated stocks breaking out of proper bases before committing money to the long side of stocks.

Don’t forget that the banking system is in serious trouble, the housing sector is in ‘melt-down’ mode and the consumer feeling the pinch of higher inflation and less access to credit. More info at www.goldenticker.com

“Real Homes of Genius” – What were we thinking!

Laggards Lead Stocks Up

JANUARY 31, 2008: Stocks rallied strongly today on good volume but today’s strength came from the beaten down retailers, home builders, and financial stocks. The laggards are not the kind of stocks that can lead a sustained rally. Mastercard was up 10% on strong earnings. Amazon.com beat earnings and sales expectations and sold off in the morning but recovered later in the day. Google missed expectations and was down $35 in after-hours trading. The Nasdaq is down 9% for the month of January. Stimulus packages, multiple rate cuts, bail-outs, etc. have failed to change the direction of the markets, which is now decidedly down. Counter-trend rallies during corrections are by no means a signal to jump back in the markets. Bear market rallies can be sharp to the upside and come back down even faster. It’s best to wait for a ‘follow-through’ day before committing money to the long side of stocks. More info at www.goldenticker.com

Here’s a sign of the times. A company that helps you just “walk away” from your home and mortgage payments. I understand that business is booming. Click on the above image to go to their site. You won’t believe what you see.

WALL ST. YAWNS AT RATE CUT

JANUARY 30, 2008: The Fed in a desperate attempt to prop up the US stock market cut another 1/2% on the Fed funds rate bringing it down to 3%. This makes it a 1.25% rate cut in just over a week. They also cut the discount rate by 1/2% as well. Markets initially rallied on the news and then sold off into the close as the smart money headed for the exits. The Nasdaq reversed off its highs in heavy volume and closed down 0.4%. The small caps as measured by the S&P 600 were hit harder and fell 1.1%. Financials should have rallied on this news but the XLF fell 2%. So much for the Fed being able to manipulate the markets. Stimulus packages, multiple rate cuts, bail-outs, etc. have failed to change the direction of the markets, which is now decidedly down.  Counter-trend rallies during corrections are by no means a signal to jump back in the markets. Bear market rallies can be sharp to the upside and come back down even faster. It’s best to wait for a ‘follow-through’ day before committing money to the long side of stocks. More info at www.goldenticker.com

Countrywide Financial CEO Angelo Mozilo cashed in on $130 million in stock and it was just reported yesterday that 33% of their subprime mortgages are delinquent. Something is terribly wrong here.

Fed Will Slash Interest Rates Tomorrow- Over 1% in a Week.

JANUARY 29, 2008: The Nasdaq gained 0.3% but volume was light again as traders await tomorrow’s Fed meeting where they are widely expected to cut rates by 1/2%. That would be a 1.25% cut in just a week, the biggest in 25 years. Some are saying that the Fed may have to cut rates below the current 2.5% inflation rate. Durable goods orders came in strong which may lessen the chance of a 1/2 point cut. Nevertheless, the Nasdaq has been rallying lately on falling volume-a sign that this unconfirmed rally could fail. Former leaders like Google, Amazon.com, and Apple are still below their 200-day moving averages-a major sign of weakness. Potash, Monsanto, and Deere have been holding up better than most stocks but are rallying on decreasing or ‘wedging’ volume. Counter-trend rallies during corrections are by no means a signal to jump back in the markets. Bear market rallies can be sharp to the upside and come back down even faster. It’s best to wait for a ‘follow-through’ day before committing money to the long side of stocks. More info at www.goldenticker.com

Paul Krugman warns of housing bubble and financial turmoil in September, 2006.

Housing and Stock Bubbles Hurt – These Don’t!

Things may be getting really scary on the global financial scene, but always remember to smile no matter what happens.

JANUARY 25, 2008: The nascent 2-day rally could not make it a third day as all 4 major indexes staged a ‘bearish reversal’ but pulled back in lighter volume. The Nasdaq started out strong but lost 1.5% and was down 0.6% for the week. It’s hard to believe that the Fed did a ’shock and awe’ surprise rate cut of 3/4% this week. This is an indication that we are in a severe correction. Credit concerns got the blame again today for the fall. The light volume today may be due to traders staying on the sidelines ahead of next week’s Fed meeting where they are widely expected to cut rates further. Transports, fertilizers, and solar stocks were strong today. Finance, retailers, and computer related stocks were weak. Some leaders were SPWR +6%, MTL +7%. Notable losers were YGE -5%, RIMM -4%, AAPL – 4%. This latest rally has the feel of ’short covering’ and is by no means a signal to jump back in the markets. Bear market rallies can be sharp to the upside and come back down even faster. It’s best to wait for a ‘follow-through’ day before committing money to the long side of stocks. More info at www.goldenticker.com

The Inevitable Collapse of the US Dollar – A “must see” video.

Peter Schiff has been a voice of reason for many years and now many of his dire predictions are materializing.

The Stock Market Will Crash Tomorrow-Jan. 22, 08

Bond Insurers MBIA and Ambac in Freefall.

It’s never pretty when your stock falls over 50% in one day.

“Our House, in the Middle of a Slump” (funny!)

Leave is again to the Brits to find a sense of humor in the all the misery of the global real estate meltdown.