Sunday, November 29, 2009

Dubai, Real Estate gone Awry!!

It is so important to realize when the market hands you clues to use when trying to dictate direction. On the night before Thanksgiving, news hit the wires that Dubai is requesting an extension on repayment of it's loan. Then on the day of thanksgiving the LSE was shut down due to price depreciation, and little was reported of this. When the US market opened up for trading on Friday, it was down triple digits and picked an unusual day to notify traders that more problems are facing the financial sector. The problem that is shaking the global markets is that Duabi is heavily supported by foreign investors such as China, Japan, and many European countries. The problem is the US relies on China to keep buying our T-bills in efforts to bail us out of our economic woes and with the banks still fragile may now have to pony up for a rescue plan for this desert Oasis which is now starting to look like a mirage. This could derail the current uptrend that we are facing as the dollar may become the safe haven for foreign investors, lowering the price of oil and spreading fears of panic again if the Dubai economy turns to sand. There is a Dark shadow with commercial real estate looming and if this plays out could be the tip off to the second down trend that many have been cautious of since the markets recent uptrend. Monday 11/30/2009 will be the true test of major selling or will the market shake off the bad news and move higher? Stay tuned as this story develops. Looking around the charts have notice that we are seeing quite a few bearish patterns setting up and that spells trouble. An example of this is a Head and Shoulders Top on the stock symbol TEX.
As stated in our last post the market is showing sign of cracking so now longs pay close attention and pick a spot that you are happy with profits for winning at the game of investing is letting the market lead the dance and taking profits on a regular basis. To get more charts like these try our free 2 week trail and learn the clues the market provides at Remember it is not what you make on your stocks but what you keep. As always, take all ye can and give nothing back.

Friday, November 20, 2009

OIH may walk the Plank

Looking over some charts this evening and noticing that one particular sector looks as if it is about to hit rough waters. Guess which one? Is the suspense getting to you? The Sector is OIL and it's service providers. When you take a look at OIH and stocks that comprise this ETF you will notice that many of these charts are displaying a topping effect, such as an head and shoulders top or another topping formation known as the double top. They say one can learn from the past and when you take a look at the chart of the OIH, you can see that we have visited this once before and the pattern failed to work it way to completion, or as I like to call it a Head fake. (Sorry for the pun.) Either way the difference between failure and success is the sector as a whole is setting up versus a few when this pattern last occurred. We will see if this pattern will be successful in meeting it price objective of $98.00 from it's current price of $117.10.. So get out the swords and tell this stock that it is time for it to walk the plank, for it has an appointment with Davy Jones' Locker. Take all ye can and give nothing back.