How to make Money in the Stock Market.This blog looks at how you can make money trading and investing in Forex, Stocks Options and Futures.


Friday, 14 March 2008

Bear Stearns- Bailed out by JP Morgan and NY Fed-Is there more to come ??


After looking like opening to the upside the markets took a nosedive this morning on the news that Bear Stearns is being given 28 days financing from JP Morgan and the NY Fed, there has been rumours for a while in the market about Bear Stearns having liquidity problems and this confirms them to be true.They are looking to put in place some permanent financing to help them with liquidity. If companies the size of Bear Stearns can get in to trouble then we should really start to be concerned about the impact of the Credit Crunch. I have said before that I am steering clear of Financial's and this further keeps me away from them for the time being.The only way to play theses is the same as Jim Rogers, short them or buy puts on any rallies.


This news and the drop in the Dow has pushed April Gold Futures up over $1000 currently they are trading at $1003, having hit a high of $1007.There are also rumours(unsubstantiated ) of a possible emergency Rate cut by the Fed-when will they learn !!



Today 09:13am

Bear Stearns Companies Inc JPMorgan Chase and NY Federal Reserve Bank providing financing for 28 days, working on permanent financing

- JP Morgan in conjunction with the Federal Reserve Bank of New York, has agreed to provide secured funding to the Company for an initial period of up to 28 days. Through its Discount Window, the Fed will provide non-recourse, back-to-back financing to JPMorgan Chase. JPMorgan Chase is working closely with the Company on securing permanent financing or other alternatives for the company.

Trade The News - Live Audio Breaking News Analysis and Futures Calls



Best Wishes





Thursday, 13 March 2008

Gold hits $1000, Retail Sales Decline-Paulson says a Strong Dollar is very much in the US interest-yea right !!


Well it happened even quicker than I thought but Gold hit the $1000 mark earlier today although it has since backed off slightly, Retail sales numbers disappointed again ,dropping 0.6% versus expectations of a rise of 0.2-0.3%.This has had an impact on the major Indices with the DJI down 185 points at the moment just off the days lows.


Hank Paulson is currently speaking and saying the same old mantra of how a Strong Dollar is in the US interests, only a couple of days after "helicopter Ben" scatted another $200 Billion dollars in to the markets like confetti, not quite sure how that will help a strong dollar.but hey how would I know. It looks like the engine of US growth the consumer may be finally drawing in its horns amongst the pressures form the Credit Crunch and Housing.If they continue to spend less and less this will really start to create big problems. With oil hovering around $110 and gas prices going through the roof, who can blame folks for not getting in their car and driving to the mall to send more ?


I am staying long and strong Precious Metals and Commodities, my position in PHPM (Precious Metals ETF) is up 51% on an annualised basis, DBA (Agriculture ETF) is up 186.9% annualised and the cotton ETF is up 235% annualised. Now is not the time to be buying stocks especially in Retail, or Financial's.


Best Wishes




Stocks decline after record Rise yesterday-Gold moving towards $1000

As I mentioned in my earlier post, I really don't feel that yesterdays rise was anything other than a massage upwards based on the Fed's announcement of a $200 Billion injection to improve liquidity.Today after rising at the open we worked our way back to end up with declines across the board.

The Dow Jones industrial average (INDU) lost 0.4%, the broader Standard & Poor's 500 (SPX) index lost 0.9% and the Nasdaq composite (COMP) lost 0.5%.


The announcement of the injection of capital from the Fed sparked a short covering rally but today we returned to concerns about what the economy is doing .The Retail Sales numbers are due out on Thursday and they will be closely watched to see what consumers are doing, if we see further declines in retails sales then it will likely spark another moving lower of the indices.


Oil hit an all time high above $110 a barrel before closing just below that, I can well remember the raised eyebrows when Goldman Sachs forecast $100 by 2009 in July 2007. looks like they were dead wrong and we got there a lot sooner !!


For me Commodities are still the place to be at least in the medium term, sure we will see pullbacks, some of them vicious but I do not see them being a bad investment over a 2-3 yr horizon.Gold was up again at $985 and I don't think it will take much for us to see $1000 in the next couple of weeks.


Best Wishes






Wednesday, 12 March 2008

Is the worst over ?-Should we Start Buying Stocks again ?

Yesterday there was a huge rally in the stock markets, Look at the 5 minute Intraday chart below:




The markets continued higher at the outset today but with little conviction and already at the time of writing, the DJI is 100 points off its high. My own view is that we are seeing bounces inspired by well orchestrated news releases and manipulation by the Fed and others to stop the  markets plunging.I am sure a lot of you have heard or read about the PPT(Plunge Protection Team) Plunge Protection Team  who's role is to try to stop catastrophic drops in the market by intervening when appropriate.A lot of people feel that there role has now morphed and they are intervening far more often in the markets to maintain the perception of a strong economy and a bull market.  There has been a number of press articles lately indicating that they are back in the markets Bush convenes Plunge Protection Team. I think we will see them being increasingly less and less effective as time goes on and people realise that there is no real substance to these rallies only manipulation. For myself I am sticking to Precious metals and Commodities as I have been advocating of late. I do not think we are out of the woods yet and there are definitely still a few hungry bears roaming around in the Bushes.


What are your views, should we be buying stocks again, is the PPT a good thing or is it getting in the road of market forces.



Best Wishes



Tuesday, 11 March 2008

Eliot Spitzer-Ironic, Sad or Well deserved ?


Isn't it amazing how so often in life those that rise to prominence on a crusade of some sort or other end up falling by the wayside, I am sure there are many in Wall Street and beyond who can barely hide their glee at the predicament that Eliot Spitzer now finds himself in.It does though boggle the mind that people who set themselves up as champions of good or head off on morale crusades often come unglued.

Well what do you think, is it divine retribution or should it have nothing to do with his work or do you think he has been extremely two faced ? be intrigued by your thoughts and comments / World - Spitzer under intense pressure to resign



Best Wishes





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Monday, 10 March 2008

Will Gold reach $1000 ?

Gold nearly made the $1000 mark and I feel it is only a matter of time before we get there.However as we all know in the markets things never go up or down in a straight line.As ever I am always looking to bring you ways to trade that expand the options we have particularly in situations like just now where it may be prudent to step aside from the stock market and let it do its thing for a while. Gold is in the news as we have seen some spectacular moves -up and down.Now there is another ETN that allows you to be able to trade Gold long and short in your account and also with some leverage without having to resort to futures or futures options.


Deutsche Bank at the end of February listed the DB Gold Double Short ETN (DZZ), DB Gold Double Long ETN (DGP) and DB Gold Short ETN (DGZ) on the NYSE Arca.( DGP | ) For more information see the link  this allows us to  trade Gold in both directions and take advantage of the large movements that we will no doubt see on its way to $1000 any beyond. make no mistake I am a Gold bull but it would be nice to be able to make some money on the pullbacks as well.


Best Wishes




How to Short Commodities using ETF

In my last post we talked about how to make money from  increased food prices and looked at the  impact these prices would have on livestock such as Live cattle and Lean Hogs. I mentioned that for the more adventurous amongst you you might also wish to look at shorting the grains as they have risen very far very quickly.Shorting Commodities has traditionally been very difficult until the recent advent of Contra ETF's.

These ETF's will move higher when the price of the commodity goes lower allowing you to benefit from declining prices by buying the ETF.One of the most forward thinking of the companies involved in these Contra ETF's is ETF Securities   ETF Securities will allow you to go short a number of the major traded commodities and since you are buying and not selling they should be  tradable in most accounts.

A major shortcoming of many  brokerage accounts has been the inability to make money when markets are doing anything but going up, now with these new ETC/ETF that is no longer a problem.It also allows for some quite sophisticated trades to be placed-for example if you are bought in to the story of the last two posts of mine and you are an aggressive trader you might consider going long livestock and short grains by buying one of the livestock ETF's such as CATL (Live Cattle) and buying one of the Short ETF such as SWEA (Wheat).


The volatility in the stockmarket currently is very difficult to invest in and is being driven back and forward by news and by the manipulations of the big boys, the commodity markets however are more fundamentally driven by supply and demand and so are easier to predict in the medium term.


Best Wishes