Monday, June 30, 2008

Breaking bad

Breaking news! USA might invade a middle-east country for its probable possesion of nuclear bombs or its potential to build them.

Where have I heard that before?

WTI Oil jumped to a ATH after the many news about U.S. ready to attack Iran, one of "the axispowers of evil". This is an event that has been in the air for a long time and probably one of the causes to the high race in oil this year. The interesting thing is though, will the attack be justified if no weapons of massdestruction are found, just like in 2003, Iraq? It probably will be, because as history has taught us; It's the winners that write the history.

I believe there is a very small risk that Iran has those weapons, but would a president take that 5 % risk of being attacked without acting? It's a dilemma that no man wants to face, but what one should keep in mind is that Iran is not Iraq. Iran defended themselfes for 8 years against U.S. supported Iraq without loosing. Iran has approximately 4 times as big population as Iraq and most importantly, Iran has a united people.

Been on holiday for a week and haven't had the opportunity to log on internet, but world indicies has faced large downturns this month which was expected. It wasn't a question of if it would happen, rather when. Oil is still a big focus of the market but the coming Q2 reports are starting to catch my eye, although an U.S.-Iran war would take the lead of primary focus.

Friday, June 20, 2008

Economy dilemma

After a short look at an interesting chart over the correlation between the oil price and the dollar, I am now fully confident about the major impact the dollar has at oilprices. That might explain the latest weeks consolidation in dollar and oil (rather days). So, if Bernanke confirms the expectations by a raise in the interest rate, we will see a major drawback in oilprices, but I don't think that is going to happen. I don't believe FED wants status quo and I don't think they wasn't aware of last weeks big hype about inflation. This will put ECB in an interesting position with an even more weakened dollar which in the end will have a major impact on the real economy on one hand and an economythreating inflation on the other hand. Jean-Claude Trichet is facing a dilemma and the outcome will probably be a small raise.

Sunday, June 15, 2008

Primary vs. Tertiary

As both Nasdaq and Dow Jones made a doubletop a couple of weeks ago stockowners could say goodbye to the secondary uptrend and make themselves ready for what Elliot Wave fantasts calls "wave C", the last and longest downtrend in a correction. The bear market has according to this been over now for a couple of weeks and the sentiment has been very bad since then, but momentum is about to turn and the tertiary trend will most likely be upwards after the fantastic finish from U.S. indicies this friday. So, be ready for a short relief race this week with Asia in the starting-block, but don't be naiv... as long as the primary trend is downwards, don't trade for a upturn and even though longterm investments are temping now, be patient, there will be better chances to fill your portfolio.

Round Two

It's not something that couldn't been figured out. It's not something that just exploded in a day or two. It's not round one anymore in this economic meltdown. It is now more likely to be a overlap by the second round, the inflationdriven round.

The coming weeks are to be filled up by soccer and Q2 reports. The premier will probably result in Netherlands as Euro Championship winners and the posterior will most likely show a major earnings fall and big downturn once again in the stockmarket. This, I presume, will be one of the final phases of this redoubtable crisis, but that does not mean "Everything is fine now, let's consume". According to the G8; "Commodity Prices Replace Credit Squeeze as Major Risk". I mean, we have not seen the end of the oilrace, one of the only commodidities that rises under controlled upturns. I can surely see a oilprice in 2008 that exceeds 150 dollar, though, the highroller politicians are not likely to let that happen so easily and according to Bloomberg, Saudiarabia might announce an increase in oilproduction in June 22 putting the oilprice on high pressure.

Monday, June 9, 2008

Bear invasion from Mars

The market sentiment is now as bearish as in March and nothing is worth owning. Lehman brother's reported a catastrophal loss at 2.8 billion dollars followed by a tradingstop in the Swissborn bank USB. This after speculation about huge subprime losses and suspicion about a share subscription right problem. Either way, the fog is probably becoming clearer for the masses and we are not likely to see a turnabout for most indicies in the near future. Stay bearish and stay alert, the sentiment can change extremely fast.

Sunday, June 8, 2008

No turnabout in sight for the dollar

The dollar is again in stormy weather after a for many after a ominous speach from Jean-Claude Trichet. After last weeks historic rise in the price of oil, Trichet is not excluding a interest rate rise in July. This interest rate policy is the opposite of the U.S. and will cause major trouble for Treasury minister, Henry Paulson who has expressed his political will to have a stronger dollar, especially to the euro. A dollar, not likely to turn on a penny or even on a zimbabwian billion dollar bank-bill. The last years falling dollar has made many to doubt the dollar as a standard currency in international trade.

As you can see at this picture, the primary trend is upwards for the Euro/dollar index and I can't see where it would stop with Federal Reserve's current policies.

Friday, June 6, 2008

Red light district

After the fastest advance in U.S. unemployment since 1986 and the price of oil that after its drawback to 120$/barrel had its biggest price/day-increase in history, graphs are likely to be as red as red light district primarily next week. I will and I surely hope that you will go in sellpositions and take this opportunity to make good money. The bear market rally is hereby over and we are back at square one. Beware, for the panic and fear is here again anytime.

Wednesday, June 4, 2008

Fast visit

I bought the two warrants yesterday and sold them today, due to lack of time to watch the monitor and a belief that OMXS30 will have a short rally up to 990, maybe 1000. The return reached almost 20 %, but the profit will be much larger in a couple of months, that I can promise. Now I'm going to congratulate my friends who are graduating today... I am gratuating tomorrow!

Tuesday, June 3, 2008

No time, got to work

Not much time for writing today, but I'll give up a few minutes for this. OMXS30 catastrophy today. Opened at 14:30 because of further technical problems with Saxess, but luckely it didn't cause any major problems such as panic and major selloff. I am at this point looking at a good time to invest with my last money. I am seeing a major downturn in the coming months and I hope to make a lot of money by buying longterm put turbowarrants. Firstly, I'll put 40 % of the capital in
TOXS8W1040SHB with knockout at 1025, secondly I'll put the rest with a bit safer position, TSOXS8W1070CAR with a knockout at 1055. It doesn't really matter when I put my calls since it's supposed to be longterm, but I'm still a bit worried since it's turbowarrants. My vision about OMXS30 is 730 in at least 3-6 months. No time right now to justify my vision, but I promise I'll give you the analysis.

See ya

Monday, June 2, 2008

Blame the deptors

Today, OMXS30 opened a bit late at 9:40 because of the technical problems that occured at the lauching of Saxess, a new system of trade. Not unsurmised, we saw a big fall in the beginning to the support of 990, but the 980 supports shortterm virginity should still be the main focus for future advance.

Oil has not yet recovered from last weeks big drop, but is likely to keep on rising this week although many analysts now claim that we're seing an bubble form and that a fall of 20-40% is probable. A scenario that we're seing more and more of, primarily from the housingmarket, but more interesting in debt.

As you can see, the U.S. economy has increased it's debt alarmingly much for almost 60 years now. Is it the consequenses of this we se now in shape of the subprimecrisis or will it adjust to a normal proportion with no larger impacts. What I am sure of is that this crisis and probable recession might have the potential to become one of the worst this generation has ever seen.

Anyway, the interesting thing about this statistic is that the latest debt bubble broke after the greatest stockmarketcrash of all time. It broke 5 years after the beginning of the depression and 2 years after the debt bubble broke, in 1937 (8 years after 1929), we saw a 47 % fall in stocks. In the 2000 hysteria, we saw a major fall in stocks, especially internetrelated. That was 8 years ago, but I have no information whether the debt has started to fall or not. Either way, we are facing a huge problem, not only for americans but for the world economy.