So today, all the hedgies ran in/covered their shorts. This list is full of broken charts. What we want to see to "believe" is see them pass over resistance and show something other than an oversold bounce. Which is what some retailers have done say over the past 7 weeks. Otherwise they are just dead stocks walking enjoying an oversold bounce, no different than financials from November 2007 - July 2008
Every chart looks like this (see below)... and frankly as they rally into either their 20 or 50 day moving averages (which is about 1 more good day for most of them) they will most likely be shorted right back down.... these are easy shorts with stops placed right above resistance - across the board. If you are 'wrong' and this is a 'real rally' in these groups you get stopped out for a small loss, and you turn into a happy go lucky quant computer going long commodities on the 'global economic rebound' thesis. But do we really expect ANY rally to last for more than a few days? It's now been a full day and a half - thats akin to 5 weeks long back in 2007. This move is getting long in the tooth - it's getting close to 48 hours.
So you say buy Tesoro (TSO)? I say I already own it, its called Mosaic (MOS). You say I need some Vale (RIO)? I say, got it covered - hello look at my Foster Wheeler (FWLT). I need to buy a Brazilian steelmaker? Nah, Peruvian copper works just the same. Stupid to sell Atwood Oceanics (ATW), an oil driller? Nah - got it covered, it's called CF Industries (CF) now. There is no difference anymore - they all have the same story - so no need to own 20 when 4 will do nowadays. You see, to hedge funds moving in and out, it's all the same stock - it's just a video game now - the only difference among these are if you have to type 3 or 4 letters in during your buy or sell order.So I lightened up some our commodity/global growth exposure across the board today, and hoping (but not counting on) 1 more nice day Monday or maybe 1 nice hour - after all it's soon Sunday night in America and you know what that means - an arranged shotgun marriage by Treasury, a surprise Fed cut, or a bailout. So hopefully we can rally Monday on these "surprises" that should be coming our way Sunday. Yawn. Can't wait for the shocker - the only question now is will it come before the 1 PM NFL games, or after? Or on this weekend will they "save" both Lehman and Washington Mutual (2 for 1 special this week?) or just 1? Oh the suspense is killing me.
(oh yes it's Friday night in America so you know what that means as well = 50%+ chance of a bank going under)
| Symbol | Company Name | % Price Change Today |
| RES | RPC Inc | 16.7 |
| VIP | VympelKom OAO | 14.9 |
| AEM | Agnico-Eagle Mines Ltd | 14.9 |
| CLR | Continental Resources Inc(Oklahoma) | 13.0 |
| MITSY | Mitsui & Co Ltd Depository Receipt | 12.8 |
| LIHR | Lihir Gold Sponsored ADR | 12.6 |
| TC | Thompson Creek Metals Co Inc | 12.0 |
| MDR | McDermott International Inc | 11.3 |
| GG | GOLDCORP INC | 11.1 |
| HOC | Holly Corp | 11.0 |
| FWLT | Foster Wheeler Ltd | 11.0 |
| HUN | Huntsman Corp | 10.4 |
| TCK | Teck Cominco Ltd | 10.2 |
| BVN | Buenaventura ADR | 9.7 |
| KGC | KINROSS GOLD CORP | 9.4 |
| PCU | Southern Copper Corp | 9.4 |
| MBT | Mobile Telesystems ADR Rep 5 Ord Shs | 9.3 |
| AAUK | Anglo American ADR | 9.3 |
| MTL | Mechel ADR Rep 3 Ord Shs | 9.2 |
| ZION | Zions Bancorp | 9.1 |
| CMP | Compass Minerals International Inc | 9.1 |
| KBR | KBR Inc | 9.1 |
| MIR | Mirant Corp | 9.1 |
| CLF | Cleveland-Cliffs Inc | 9.0 |
| ABX | BARRICK GOLD CORPORATION | 9.0 |
| STOSY | Santos ADR | 9.0 |
| VLO | Valero Energy Corp | 8.9 |
| LULU | lululemon athletica inc | 8.8 |
| NRP | Natural Resource Partners Units | 8.7 |
| SQM | Sociedad Quimica y Minera de Chile | 8.6 |
| PAAS | PAN AMERICAN SILVER CORP | 8.5 |
| ENER | Energy Conversion Devices Inc | 8.4 |
| SID | Companhia Siderurgica Nacional ADR | 8.3 |
| RTP | Rio Tinto ADR Each Reptg Four Ord Shs | 8.3 |
| SNV | Synovus Financial Corp | 8.2 |
| AHGP | Alliance Holdings GP LP | 8.1 |
| ACI | Arch Coal Inc | 8.0 |
| BHP | BHP Billiton ADR | 8.0 |
| FCX | Freeport McMoRan Copper & Gold Inc | 8.0 |
| IX | Orix Corp Depository Receipt | 7.9 |
| WBD | Wimm-Bill-Dann OAO | 7.8 |
| BRY | Berry Petroleum Co | 7.7 |
| BVF | BIOVAIL CORPORATION | 7.6 |
| ASBC | Associated Banc-Corp | 7.5 |
| DRQ | Dril-Quip, Inc | 7.5 |
| TRA | Terra Industries Inc | 7.4 |
| BBL | BHP Billiton ADR | 7.4 |
| POT | Potash Corp | 7.4 |
| AGU | AGRIUM INC | 7.3 |
| FTO | Frontier Oil Corp | 7.3 |
| MOS | Mosaic Co | 7.2 |
| FHN | First Horizon National Corp | 7.0 |
| MMR | McMoRan Exploration Co | 6.9 |
| XCO | EXCO Resources Inc | 6.8 |
| PBR | Petroleo Brasileiro ADR Reptg 2 Ord Shs | 6.7 |
| UBB | Unibanco Depository Receipt | 6.7 |
| ACGY | Acergy ADR | 6.6 |
| SMS | Sims Group ADR Representing 1 Ord Shs | 6.6 |
| AWC | Alumina Ltd Depository Receipt | 6.5 |
| CNX | CONSOL Energy Inc | 6.4 |
| CF | CF Industries Holdings Inc | 6.4 |
| ATW | Atwood Oceanics Inc | 6.3 |
| RDC | Rowan Companies Inc | 6.3 |
| CXO | Concho Resources Inc | 6.3 |
| HERO | Hercules Offshore Inc | 6.2 |
| TX | Ternium SA | 6.2 |
| GDP | Goodrich Petroleum Corp | 6.2 |
| UPL | Ultra Petroleum Corp | 6.2 |
| NETC | Net Servicos de Comunicacao ADR | 6.1 |
| OII | Oceaneering International Inc | 6.1 |
| SWN | Southwestern Energy Co | 6.1 |
| KWK | Quicksilver Resources Inc | 6.1 |
| NUE | Nucor Corp | 6.1 |
5 comments:
And the impact on the public is ...
retail gas hit $4.60 in Knoxville/Oak Ridge, Tennessee this afternoon. About 10 percent of stations were out of fuel; those that had fuel had lines at each operating pump.
Knoxville is a terminus of the Colonial Pipeline, the corporate headquarters for Pilot Oil [think truck stops], and a transport hub for motor carriers.
This is the commodity crisis hitting main street.
Oh well, pass the koolaid, we'll just stay home, drink beer, and watch football.
You are so right ... I've been running various scans and it just boils down to commodities one day and financials two days later. Doesn't matter what I scan for... 'Stocks over a moving average, moving average crossovers, stochastics above 20..etc..
Anyway, it sure is nice (in a contrary fashion) to see Texans paying more for gas than Californians ... When I was working down there, there was about a 50 cent a gallon differential.. Right now, up in the expensive foothills, we are paying $3.89 ...
jegan
thanks for all your hard work on the site!! And, I am laughing my ass off right now...
I am just a guy "moonlighting" as a swing-trader (it's too derogatory to call myself a day-trader... those guys go broke).
Anyway, you are absolutely right.
The one thing to add - is that "these days" every small-time, 6-figure-pot, mouse-clicker (like me) is piling into trades and gun-jumping every obvious momemtum and resistant level trade (as you outline in this post).
This is causing crazy, unsustainably steep drops, rather than old-fashion (circa 10 years ago) trends to "reasonable" equilibrium points.
Whiplash all-around - not to mention the "well-intentioned" disruption that we have the feds and treasuries regulary introducing into the system. Boy, are they activist government types.
Equity markets (and probably most others) just don't trend anymore, but rather lurch...
The mouse clickers and super-rich hedge *fun* guys (now getting redeemed to death) must be causing havoc for Ben and Paulson's behavioral finance algorithms.
Anyway, thanks for you blog and the good laugh on a Sat night as I ponder my fantasy football line-up and short cover target zones and stop short-cover points.
Shawn
Your comment about it's Friday night in a America so there is a 50% chance a bank will go under this weekend...It's sad, but true......Dollar is weakening as a result of Lehman's bankruptcy. Do you think this will lead to higher commodity prices? It seemed during the commodity sell off, that the dollar was getting strong every day. Perhaps there will be a reversal and the short financials/dollar and long commodities will be the trade again. Which would be fine with me since I'm still long coal stocks like BTU, PCX, and ANR.
hrs, I bought gas Thursday night knowing they'd jack it up. Why they increase gas before the storm even hits is something only blind regulators should ask - but they don't care. We went from $3.79 to $4.29 overnight here.
Shawn, yes lurch is the correct word. There is a lot of ironies. Lehman on behalf of its biggest clients (hedge funds) was cheering on the removal of the no uptick rule. Look what took them down - I tell you these financial entities helped create Frankensteins and their creations came back to destroy them. Irony.
Rey,
Expect the same for the next 18 months or so. Every Friday night we'll have a good chance. To tell you how pathetic it is, IndyMac Bank which I believe was top 3 biggest failures was not even on the FDIC "troubled bank" list a quarter before it went under. washington mutual which is probably going to be taken over by JPMorgan since it is in so much trouble is not on the FDIC troubled bank list. This tells me the troubled bank list is near useless.
I think the dollar to commodity link is overblown. Commodities were run up by levered hedge funds finding something to work in a very tough market of November 07-June 08. That is clear now. There is a good thesis behind these names, but levered hedgies take a good thesis and take it to the extreme. Now they are unwinding or being forced to be.
The dollar is now barely down during one of the most destabilizing periods in US financial history. Why? It makes no sense? My gut is hedge funds are piling in. And that's all that matters in these markets. Where they go to play, despite any factual evidence or fundamentals, is where the prices move.
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