MCP still hot

Molycorp took off like a rocket this morning after languishing for a couple of days.....

I see they report earnings on Aug. 8th.

It kind of looks like it will go above that $8 mark.

Control your risk,
gh

MCP update

Molycorp soared to $8 as anticipated. Now watch how it reacts. So far it acts like it can go higher.

The charts from then and now......

 

control risk, gh

Dianna

Dianna Shipping hit a recent high price ceiling for the third time this week. I love "triple tops" precisely because they are rarely the top. There is no reason for a price to hit a high price three times. The first time is because the price just got too high for the times. The price declines and those that missed the move buy, and those who need more stock buy the dips. The price rises back to the high. People sell at previous highs, expecting a range. And short sellers get active. The price declines a second time due to traders and those who erroneously bought the first rally wanting to get out at even.
If the price makes it to the high of the range for the third time a range is defined, at least. And the trend has changed if near a bottom.
My experience is that the stock will seek to break out above the range after hitting the top three times.

In this stock I notice a time period of about two months between the larger moves. I expect this time to shorten now.

This company is a beneficiary of the price of dry bulk shipping rates as reflected in the Baltic Dry Index

control risk,
gh

Producer Price Index

Handy, Max!

"Greek shipping companies, the owners of one in six merchant vessels, are ordering the most new iron-ore carriers since 2008, betting the five-year rout in charter rates may be nearing an end. "

Here is further on the rally in shipping rates as reflected in the BDI.

ship-rout-ending-with-most-orders-since-2008

Handymax and Supramax are naval architecture terms for a bulk carrier

http://en.wikipedia.org/wiki/Handymax

 This BDI thing may work out...............

gh

Why so many investors get "faked out".

While glancing around over on TBP I noticed this link to a Motley Fool article article on gold and why investors "fall for bubbles". Mentioning gold and bubble in the same sentence is another way to imply that when gold goes up it is just a bubble, of course. What, after all, is gold good for. It is just a barbaric relic according to some parties. I could say the same thing about oil I suppose and point out that as an investment it isn't really that good, since you have to burn it up to get any good out of it. And then it is gone. Same with most of the commodities of the soft nature, orange juice, oats, corn, soybean oil and the like. And you know what you get after you use them up..... And yes, when demand is strong for those commodities they can see dramatic rises in price and equally dramatic declines in price as the demand wanes or supply is brought to market. So I guess you could call them bubbles. As long as the price fluctuations have nothing to do with supply or demand. But what is a price fluctuation but a reflection of the strength of demand or supply?

Motley Fool, if I remember right was started in the mid-late 1990's as a sort of common mans investment advice purveyor. They were the antidote to the mindless investing of the 90's. But from what I've seen they have fallen into the commercial trap as well as any investment advisor. And their articles tend to have a homogenous taste that smacks of advice to the most ignorant of paying "investors".

I suppose I just take umbrage with anyone calling gold a bubble since it is essentially a currency. Although it is not as convenient an medium of exchange, as say, the U.S. Dollar around the world it functions much better in the other role of a currency. That role being as a store of value. Particularly over the long stretch of time. I can't think of a paper currency that has been in use for over a couple hundred years, can you?

And as far as value goes, the Dow Jones Average was at 660 in 1960. Now at 15,480 for a rise of some 2,245%.
In 1960 gold was at $35 an ounce, now at about $1200/oz. for a rise of about 3,328%.

It would appear that gold holds it's value over the long haul.

It is reassuring to myself when publications start to pronounce a "bubble" in gold. They pander to the uninformed and the short term. Most markets will disappoint the most people in the course of their wanderings. Low inflation has been the story for twenty years now, with only that short episode in mid 2000's. The big trends get started in fits and starts, as people jump in and out according to the news of the day. Most are thinking of deleveraging still............

I think a few gold investors are getting faked out. But what do I know?

Just thinking,
gh

Eagle

I looked up in the sky a few minutes ago and there was a bald eagle circling above. Not this particular eagle, but probably a genetic relation.

Maybe this EGLE will soar....

It would be about time. The BDI remains near recent highs............

gh

Jubilee!

In  biblical times there was a provision for a debt jubilee. A time when debts were forgiven. This could occur every 25 to 50 years. In my humble opinion it was an acknowledgment of the power of money to make money. And early recognition of the tendency of capitalism to concentrate money. "It takes money to make money".

Nowadays, since we are not a religious society, and neither am I, our democratic system will still, through the social tendencies of people to adopt what works, engage in a forgiveness of debts. Even if we have to make up some legal reason that fits in with our "modern" mindset.  So we put up with the Federal Reserve system and Mr. Bernanke who will despite our puritan impulses( that are only superficial) enable us to inflate our way out of our debts. And we will have the upper hand if we choose to do so since we own the reserve currency of the world!

Does anyone have any doubts that a government "of the people and by the people" will not in the final analysis inflate their currency in order to minimize the debts they have incurred as the result of the mercantilist manipulations of the centrally controlled economies of the rest of the world??

I have few doubts. We will make it look like we prefer to pay our debts in good money, but the fact remains that we all rejoice as our assets are inflated by the debasement of our currency.

And don't think that I do not approve. We have been schmucks. To put it mildly. To have the power of the reserve currency was wonderful as we needed to import our energy from the rest of the world. But it led to the hollowing out of our manufacturing base with the financialization of the world and with the emergence of the emerging market central banks who did not shrink from the task of a manipulation of their own currency.

But we have Bernanke and we will in the end best them at their own game through necessity.

Todays news:

Bernanke this afternoon.

And the history of debt forgiveness.

And I can't believe how radical I sound sometimes....... But I used to think those that were predicting bad things in finance were radical.....

Gold up sharply this evening....

gh

Commodities strong on a strong dollar

Steel, Iron, and Corn acting nice today, despite a long downtrend for all of them.

MolyCorp acting particularly strong today and lately.

AK Steel up as expected, not a decisive as expected.

And Corn looks to have bottomed. It took out the weak hands by going to new lows a few days ago and bouncing strong today. It is time to start betting on the weather in the Midwest...?

And the Baltic Dry Index up for the 2nd day after two day of modest declines. The BDI is getting close to a breakout from a long channel here at the "bottom". A breakout to the upside in shipping prices must be an attention getter.

I look at the BDI here.
Take a look at the longer term.

And the others:

Control your risk,

gh

AKS

I'll go out on a limb here:

gh

AKS bottom?

It looks like AK Steel may have bottomed for awhile. Here is why I think that.

Today AKS drifted down below recent lows on low volume. There was no urgency to the selling, for a change!

And shortly thereafter it moved sharply higher on much higher volume.

Charts:

On the fundamental side there was JP Morgan recommending a "buy" on commodities this morning.

 

gh