Friday, December 28, 2007

Gold vs U.S. dollar

Gold & U.S. Dollar

Cyclic Opposition

We view the shorter daily cycle on the streetTRACKS Gold Shares (NYSE-GLD) ETF plotted above the daily cycle of the U.S. Dollar Index.

Note the current cyclic opposition - We now have a buy/gold sell/Dollar condition that could persist through mid January 2008

Sunday, December 23, 2007

Santa Claus

Technical Phenomena & Annual Events December through January in sequential order

TAX LOSS SELLING: Stocks in down trends are generally exposed to panic liquidation in the last two weeks of the tax-loss selling window. Two examples would be Celestica (CLS) and Talisman (TLM). These stocks will typically rally from Christmas through the new-year mid-January

SANTA CLAUS RALLY: It is a well-known phenomenon, first discovered by Yale Hirsch and published in his Stock Trader's Almanac. During this year-end rally, stocks tend to advance, sometimes sharply, from the day after Christmas to the first two days after New Year's Day.

Several drivers for the Santa Claus Rally:
The end of tax-loss selling.
A tendency for investors to fund IRAs (RRSPs) at the start of a new year.
Financial institutions and mutual funds seeking to be fully invested for the New Year.
Upbeat year-end stock forecasts for a good January (the January Barometer).

This year Santa arrived on Friday December 21, 2007

THE JANUARY BAROMETER: As January goes – so goes the year. Not to be confused with the January Effect that observes the performance of small cap vs. large cap stocks in January.

The "First Five Days" in January indicator holds loosely that the direction of the first five trading days of the year is a valid predictor of the direction of the market for the remainder of the year.

As proof of the indicator's effectiveness, it's proponents look at a 55-year record and state that of 35 "First Five Days" that finished up, the stock market finished up in 30 of those years - an impressive 85% win rate for the Barometer. Caution this is not a money management tool!

Friday, December 14, 2007

Fort Chicago Energy Trust

I bought Fort Chicago Energy Trust (TSX-FCE.UN) to-day for my RSP because of the

recent return of FCE.UN to a sector relative Out-Performance

The chart below is that of FCE.UN plotted above the TSX Utilities Index

The two lines below are averages of relative performance (RA)
Note also the long base

Wednesday, December 12, 2007

Orphaned Stocks

On October 24, 2007 - Standard & Poor's Canadian Index Operations announces the following index changes to the large cap S&P/TSX 60 Index

Alcan will be removed from the S&P/TSX Composite and Capped Composite, the
S&P/TSX Equity and Capped Equity, the S&P/TSX 60

Cott Corporation (TSX:BCB) and Celestica Inc. (TSX:CLS) will also be removed from the S&P/TSX 60

Gildan Activewear Inc. (TSX:GIL), Inmet Mining Corporation (TSX:IMN) and Uranium One Inc. (TSX:UUU) will be removed from the S&P/TSX Completion and Equity Completion indices and placed in the S&P/TSX 60, 60 Capped and Equity 60 indices. These transactions will be effective after the close of Wednesday, October 31, 2007
Indexers and tax loss selling has killed this stock - often orphaned stocks will perform better after being booted from a benchmark index

Friday, December 7, 2007

Zarlink Stopped Out Breakwater Entered

On Thursday mid-day we bailed out of our Zarlink trade at 68 cents. On Wednesday there was a big cross of 4 million shares at 70 cents and so we decided to sell if the stock traded for two days under the cross price. Clearly this trade was not working from the moment we took on the position. We rolled the proceeds into the over-sold Breakwater at $1.75

Dec 06, 2007 Sell ZL Cdn. 10000 10000 0 0.68 Filled
Dec 06, 2007 Buy BWR Cdn. 4000 4000 0 1.75 Filled

Wednesday, December 5, 2007

Bombardier Inc. bull?

There is always a bull market somewhere, the key is to identify a long term theme and stick with it .

Aerospace and transportation is a long term theme.

Monday, December 3, 2007

Tim Horton, money maker?

Tim Horton is a wanted stock - now a component of the S&P/TSX60 this liquid stock is being discovered by nervous money managers who will lighten up on the commodity issues and have a need to stay invested

Friday, November 30, 2007

Rotational Structure

All bear markets can vary in terms of structure

This bear appears to be rotational in nature

Note the price peak in the leading Financials in May 2007 - and the subsequent A-B-C type correction

Plan now for the same A-B-C correction in the lagging commodity sensitive sectors.

Wednesday, November 28, 2007

Tech stocks vs Gold stocks

Technology stocks on a relative basis under-performed gold stocks through 2005 - 2006

In late 2006 our Relative Averages (RA) began to display a shift away from gold stocks to technology stocks

Any new 52-week high in the XIT would confirm our studies

Monday, November 26, 2007

Bollinger Bands vs True Range

I tried Bollinger Bands and found they generate too many "False" signals

True Range bands solve this problem

Bill Carrigan

Thursday, November 22, 2007


We bought Zarlink to-day November 22, 2007 @ 75 cents because inspite of a negative press release the stock had a big volume day with no price change. This positive technical action is supported by the strong relative performance of its peers in the Information Technology sector.

Monday, November 19, 2007

Portfolio Insurance

Our "Own Bull" - "Own Bear" Beta Pro ETF's are issuing an "Own Bear" signal.

See chart above

Get those portfolios insured!

Friday, November 16, 2007

Getting Technical's financial Glossary

Welcome to Getting Technical's financial Glossary Of Investment Terms that covers the important investment stuff. Study the following and you’re on your way to being a successful investor.

By the way, did you hear about the two Financial Planners on the Titanic? One of them felt the ship shutter and shouted - I think we hit something. The other replied - why should you care, it's not your boat.

Important Stock Market Definitions

Bull Market: What the markets do after you sell because of a recession, corporate scandals, political unrest, war jitters and soaring oil & gold prices.

Bear Market: What the markets do after you buy because of bright economic conditions, corporate earnings growth, peace in the middle east, and low oil & gold prices.

Bonds: A magical piece of paper that is worth more when the economy is bad and then worth less when the economy is really bad.

Stock: A magical piece of paper that is worth more when the economy is good and then worth less when the economy is really good.

Call Option: The opportunity to lose small amounts of money over short time periods.

Cash Flow: The movement of money from a mutual fund to the fund manager. Sometimes called management fees or MER’s.

Commission: The money you pay to your broker to buy and sell.

Trailer Fees: The money you pay to your financial planner to buy and never sell.

Day Trader: The opportunity to loss large amounts of money over short time periods.

Long Term Investor: A day trader who has refused to sell a losing trade.

Good Investor: Will agonise for weeks over a buy decision and sell on impulse.

Bad Investor: Will buy on impulse and agonise for weeks over a sell decision.

Investor Advocate: A bad investor looking for someone else to blame.

Financial Planner: Jack of all trades and master of none.

Margin Debit: The unique opportunity to have your original investment go to zero and lose 200 percent of your capital.

Market Correction: What the markets do the day after you buy stocks.

P/E Ratio: Better known as the panic/exit ratio. Fund managers use this number to calculate the time required for all of the unit holders to bail out of a fund.

Short Position: A type of trade where a person sells stocks they don't actually own. You can also be short on rent payments, car payments and alimony.

Stock Broker: The master illusionist who disappears when your stock goes down, only to reappear if the stock subsequently rallies.

Stock split: When your ex-wife and her lawyer split your equity portfolio equally between themselves.

Fundamental Analyst: Analysts who think they are right.

Technical Analyst: Analysts who think the market is right.

Momentum Investing: The art of buying high and selling lower.

Value Investing: The art of buying low and selling lower.

We welcome other additions to our Glossary

Dollar Cost Averaging: The Strategy of averaging down on a losing mutual fund investment.

Bill Carrigan