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Everything posted by inthemoneystocks

  1. People Are Clueless About The Price Of Oil, This Is Why The psychology of people involved in the stock market never ceases to amaze me. On February 11, 2016 crude oil traded as low as $26.00 a barrel, but people in the stock market were terrified to buy it at that level. In fact, many of the financial talking heads on television were saying that oil would go down to $10.00 a barrel. These types of remarks caused people in the public to avoid investing in crude despite the commodity trading at new yearly lows and being severely oversold. Now crude is trading above $50.00 a barrel and people are afraid to sell it short despite crude rallying higher by nearly 100 percent since February. Many of the financial talking heads are now saying that oil will go to $75.00 a barrel before peaking out. Isn’t it funny how these so called experts come up with these levels? What are they using to say these statements. The truth is that they are probably hoping it comes back to that level so their investments can work out or recover from the 2016 decline earlier this year. If anyone looks at a chart of crude oil they could clearly see oil has major resistance around the $50 to $55.00 dollar area. Today, crude oil is trading around $51.00 a barrel. There are many factors that affect the price of crude oil. Some of these factors include oil production output, weather, geopolitical events, and the U.S. Dollar. Out of all of these factors the strength and weakness in the U.S. Dollar seems to be most important. Please understand, most of the oil in the world is traded in U.S. Dollars. So if the U.S. Dollar is strong against most other currencies in the world the oil price will likely decline. That was certainly the primary reason for the decline in crude throughout the past two years. There are many ways to trade oil despite using oil futures these days. ETF's and ETN's such as the United States Oil Fund LP (ETF)(NYSEARCA:USO), iPath S&P GSCI Crude Oil Total Return(NYSEARCA:OIL), and the ProShares Ultra DJ-UBS Crude Oil(NYSEARCA:UCO) are just a few different vehicles that can be used to trade oil on the long side. Some short side trading equities for crude include the ProShares UltraShort Bloomberg Crude Oil ETF(NYSEARCA:SCO), and the DB Crude Oil Double Short ETN (NYSEARCA: DTO). Full disclosure: I currently own SCO shares. Nicholas Santiago Inthemoneystocks
  2. Molycorp Inc (NYSE:MCP) is a rare earths play that has been pounded. The stock is trading at $1.31, from a 52 week high of $7.59. This stock is forming a nice technical bottom and will likely see a major pop soon. Below are the three reasons. 1. On September 11th, 2014, Molycorp Inc (NYSE:MCP) secured $400 million of funding. This means they have enough cash to operate for quite some time before bankruptcy is an issue. If they can reach certain milestones, it is likely more funding will be made available. As Molycorp is trading at near bankruptcy levels, it is undervalued and likely will rise. 2. Rare earth is a main component of missiles and radar systems. With global conflict soaring, involving almost every major world power, prices are likely to go much higher. This will boost the chance of Molycorp meeting its key numbers and potentially turning a profit. 3. Per their press release on Tuesday, September 30th, 2014, "Molycorp Announces that its Expanded Leach System Has Now Been Placed Into Service at its Mountain Pass, California Facility". They appear to be on the right course of action, moving towards expanding production just as prices should begin to increase. In addition, the chart has obviously bottomed on the daily, signal a technical pop on the horizon. Gareth Soloway InTheMoneyStocks
  3. The stock market continues to sell off for the third day in a row. Just last Friday, the markets opened at a new all-time high. Why is this time different than other pullbacks in the market? Below are the three reasons things are different this time. 1. Alibaba Group Holding Ltd (NYSE:BABA) went public with tons of hype. The stock opened around $93.00 and closed right there. All the hype of the 'biggest IPO ever' did little to push more buyers into the market. Please be aware that in 2007, the markets topped on the much hyped IPO The Blackstone Group L.P. (NYSE:BX). This was the Alibaba of its time. 2. The Scotland 'No' vote on independence was hailed as a major victory for the currency markets as well as the debt markets. The futures rallied higher as word trickled in that the people of Scotland voted against it. The very next day, the markets saw little to no reaction to the positive side. In fact, the markets opened higher and sold. 3. The Federal Reserve remained dovish last week in their commentary. The markets saw a minor pop and have since sold off. The Fed no longer has major buyers willing to commit money to this market at these highs, especially since everyone knows interest rates will be raised by mid next year. The above three events all happened last week and the markets saw almost no upside and have quickly dropped below the recent lows. The market is no longer reacting to good news with significant upside. This is a major change in character to what we have seen weeks and months ago. Gareth Soloway InTheMoneyStocks
  4. Baidu Inc (NASDAQ:BIDU) is known as the Chinese Google. That comparison alone tells you this company is a powerhouse. The key thing to understand is that China has over 1.3 billion people while the United States has only 313 million. If Google has a valuation of $372 billion, why can't BIDU have a valuation 4X greater? Right now BIDU has a market cap of $53 billion. This is the mentality that has driven investors to buy this stock. Anyone betting on best of breed in China is betting on BIDU. Having said that, considering the latest economic woes of China, my bet will be that investors can buy BIDU much cheaper than the current levels. $114 will be the first spot my toes dip into the buy BIDU water. The stock is currently sitting at $151.47 per share. Stocks are not so much a good gauge of reality, instead they gauge emotion. Euphoria and fear are the driving forces. With the stock market making a top in this vicinity, fear will soon take over and push a majority of stocks much lower. Cheers! Gareth Soloway InTheMoneyStocks
  5. Facebook Inc (NASDAQ:FB) has a classic bear flag that is forming under the 20 moving average on the daily chart. This is one of the better patterns you will see and ultimately tells of much further downside on the stock. Even today, the stock is underperforming a market that is flat. Facebook is trading at $68.21, -0.98 (-1.42%). Key supports will be $58.85 and $53.45. Gareth Soloway InTheMoneyStocks
  6. The markets find themselves near all time highs once again, just two weeks after it appeared the sky was falling. So what gives? Is the market headed for another 30% move higher in 2014 or is there an epic collapse on the horizon? All signs point to a classic scam by large institutions to lure the small investor into the market prior to a 2007 type fall later this year and in 2015. The media and analysts have piled back on the buy-the-dip commentary. Investors are pushing more capital into the markets every day, in many cases they are borrowing money to do it. The use of margin is at all time highs. The last time it was at all time highs was in 2007, prior to the financial collapse. History tells the truth and ultimately there are far too many similarities to ignore. For the record, the similarities not only mimic 2007 and 2000 prior to the epic drops but also going back as far as 1929. Many 'experts' and media commentators are saying there will be no collapse. Considering they are manipulated by the big banks...of course they would say that. First, it is important to understand the game that is played. Large institutions use emotion to take money from the smaller investors. There are 90 million Americans that invest and less than 1% avoid being caught in this game. How does it work? Using the media and analysts along with the stock market moves, they pull the strings of investors to get them in and out when they wish. That means getting them to buy at the highs on a market and getting them to sell at the lows. Have you ever wondered why everytime you enter a stock it seems you are on the wrong side? That is the game being played on a minor scale. How do you avoid the game? Simply do the opposite of what your 'gut' is telling you. If you feel like you should buy the market? Stay in cash or short it. If you are extremely scared, too scared to buy the market...then buy it. If the media is pumping Twitter (TWTR) like crazy at $75 (like they did a few months ago), short it. If the media and analysts are trashing a stock, buy it. A great example was when J.C Penny fell just a few weeks ago to $5.00. The media was trashing it and many gurus were saying it was going to '$1.00'. Yet here it sits with a 20%+ gain at $6.10. This works so well it is almost scary. Why do the institutions do this? Simply put, it is to profit. It all comes down to the mighty Dollar. When the markets or a stocks get too extended, the big players need to get out. By hyping those stocks, they lure the small investors into the market and can sell right to them. Once the institutions unload, the markets fall and the small investor loses their money. When low enough, the fear hype will reach a level that causes 'long term investors' to sell their positions right to the institutions. Once this happens, the markets can go higher again. This latest rally and bullish sentiment in the media and analysts is just a way for the big institutions to get you in the market before the drop it. Read the signals and think logically. Gareth Soloway
  7. As we all know, the major stock indexes such as the Dow Jones Industrial Average, and the S&P 500 Index are in a confirmed correction at this time. The major stock indexes in the United States have all fallen by more than 5.0 percent since topping out in mid-January. Traders and investors that are looking for stocks to buy should look for stocks and sectors that are showing relative strength when compared to the major stock indexes. One sector that has shown strength in the near term has been the large natural gas stocks. Some of the leading stocks in the sector include Cabot Oil & Gas Corporation (COG), Chesapeake Energy Corporation (CHK), Southwestern Energy Co. (SWN), and Devon Energy Corporation (DVN). All of these stocks mentioned are holding up well despite the recent downturn in the major stock indexes. Traders can watch for near term daily chart support on Devon Energy Corp (DVN) around the $56.00 level. This is an area on the chart where the stock should find institutional sponsorship. The $56.00 level was also an area where the stock broke out in August 2013. Often stocks will revisit their breakout levels before rallying higher again. Nicholas Santiago
  8. Would it shock you to know that options are a total scam when you hold them into expiration? Would it surprise you to know that the institutions manipulate stock prices into expiration to maximize their profit? If you are like me and have traded and invested for years, you are not surprised. All others, let me explain the game. Overall, options can be played throughout the month and done correctly, you can make money. However, I strongly warn against holding them into expiration. Why? Because the institutions will push stocks they have sold large options positions in, to have them expire worthless. In other words, classic stock price manipulation occurs so the institutions can walk away maximizing their profits while the little investor ends up losing everything. Let me walk you through it step by step. Institutions sell a majority of options. The buyers of these options are the small investor. The small investor pays a premium to buy the option. This premium becomes 100% profit if (and only if) the option expires worthless. Knowing that, it makes sense to think that institutions would want to maximize their profits and have reason to manipulate stock prices to achieve that goal. The institutions have computer programs that will tell them exactly where a stock must close to maximize their profits. On options expiration Friday, watch for key stocks like Apple, Google, Amazon or JPMorgan Chase to close at round, even numbers. Like $500, $55 or $81. This would be the strike price on the option where the institutions maximize profits. I have seen this happen almost every options expiration Friday. Knowing that this happens gives the average investor the ability to be out of options prior to the manipulation. Education and knowing the shady games of Wall Street give us the ability to profit for life. Gareth Soloway
  9. Yesterday, Janet Yellen was confirmed by the Senate to be the next Federal Reserve Chairman. History will judge her to be the one holding the markets... Yesterday, Janet Yellen was confirmed by the Senate to be the next Federal Reserve Chairman. History will judge her to be the one holding the markets reins as the next mega stock market bubble collapses. It is somewhat unfair she will be blamed almost entirely, as a majority of the damage will have been inflicted by her predecessor Ben Bernanke. However, she has always been as dovish, if not more than him, never dissenting. The bed for the United States and world has already been made. At this stage it is just degrees of bad that Janet Yellen can control. How much more money is printed? How much higher does the stock market go as the bubble inflates? How much more debt will the U.S government take on and how much higher will the balance sheet of the Federal Reserve go? Top 3 Reasons This Market Will Collapse In 2014-15 1. The Federal Reserve Balance sheet has risen to over $4 trillion. The Federal Reserve is still planning on printing $75 billion every single month going forward. As the economy continues to improve, inflation is going to jump (this always happens with a better economy, even ignoring the massive printing of money that has been done). History has shown us that when inflation starts, it is very hard to control. A good example is China in recent history. In addition, never in history has this much money been printed. 2. Rates are going much higher and soon. We have already seen the 10 yr yield surge above 3%, up about 100% from its recent lows. As much as the Federal Reserve wishes it could control rates, there will be a breaking point where the flood gates open (it likely started already). Rising rates will put a major halt to economic growth as the borrowing of money becomes too expensive for most. Housing will take another hit as well. This means higher unemployment and lower economic growth...just as the economy was starting to do better. 3. The stock market will crash. The stock market has risen 150% off the 2009 lows (without any major corrections) partly because the world is not ending but mostly because the Federal Reserve has been there to backstop any negatives with more printing of money. That money has artificially deflated rates causing money to flow into the stock market. The bottom line is that the market is on a drug called QE. There is no fear of anything because the market feels the Federal Reserve will always be there to bail it out. As the Federal Reserve lowers the amount printed, the market will stall in these upper levels (starting to see that now). As rates rise and economic activity start to stall out later in 2014, the market will hope for more intervention from the Federal Reserve, however quickly realize the Federal Reserve's former tactics will not work. This is where the major freakout will happen. Imagine drug withdrawal. As Janet Yellen takes control of the Federal Reserve, the markets expect more of the same. While the bed has already been made, she will likely make it worse by continuing to feed the drug of QE into the market and economy. There is only disaster waiting at the end of this ride. There is no way you can print over $4 trillion dollars and not have some negative overdose down the line. The markets are priced to perfection and the dark clouds can be seen on the horizon. The Federal Reserve portrays itself as having the ability to always control the outcome. However, we clearly know from history this is not the case. Beware the bubble collapse cycle which hits in mid 2014-15. Gareth Soloway InTheMoneyStocks
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