Introducing the You Tube Channel and The Traders Handbook.

I have opened a You Tube channel and another blog to discuss everything about trading, from systems to the psychology. So check it out and enjoy.

http://www.youtube.com/user/FreshLookWS?feature=mhee

http://tradershandbook.blogspot.com

Week Ahead (Aug 15-19)

Monday starts the week’s flow of news with the TIC long-term purchases.  This data represents the balance of domestic and foreign investment. The market impact tends to be significant but varies from month to month. Demand for domestic securities and currency demand are directly linked because foreigners must buy the domestic currency to purchase the nation's securities, which will be a good indicator of how capital flowed in this volatile month for the market.

Building Permits will be released on Tuesday. It's an excellent gauge of future construction activity because obtaining a permit is among the first steps in constructing a new building which will indicate how the housing market recovery is doing.

On Wednesday we have the release of the PPI (Producer Price Index). This tends to have more impact when it's released ahead of the CPI data , which is on Thursday, because it's a leading indicator of consumer inflation - when producers charge more for goods and services the higher costs are usually passed on to the consumer.

CPI  will be released on Thursday showing consumer prices  for the month accounting for a majority of overall inflation. Inflation is important because rising prices lead the central bank to raise interest rates out of respect for their inflation containment mandate.

Unemployment Claims will also be released on Thursday. This is currently the nation's most important economic data. The market impact fluctuates from week to week but will be important as it is one of the most watched economic data amongst the street. Although it's generally viewed as a lagging indicator, the number of unemployed people is an important signal of overall economic health.

Week in Review for Financial Week Aug 8-12

Each day of this week has seen the Dow Jones industrial average swing at least 400 points. The week started with a 634-point plunge Monday responding to S&P’s Downgrade of US debt, but on Tuesday, the Dow soared 429 points after the Federal Reserve's announcement on the economy and interest rates Tuesday. The Dow bounced up 100 points, then fell 400 points, and then roared back more than 600 points — all within an hour and a half. Wednesday showed the Dow continuing its free-fall erasing all of Tuesday’s gains and some with a 520 point decline. Global financial markets rebounded sharply Thursday after a drubbing Wednesday, extending one of the most volatile streaks in history for stocks. The Dow Jones Industrial Average surged 423 points. It marked the first time in the index's 115-year history that it has moved by more than 400 points for four consecutive days. Friday ended with a 125 point rally in the Dow ending the week  just 1.5% lower, surprising after the volatile week we have had.
The current market mayhem was kicked off by concerns about a wide range of economic problems, including seemingly intractable unemployment in the U.S., political paralysis in Washington, continuing weakness in the financial system and over-extended European governments. The sheer number of moving parts that investors are trying to keep their eyes on has made it hard to stay focused on any one problem.  With many economists now fearing the recovery is in jeopardy of reversing into recession, it may be some time before Wall Street can find its footing again. Ultimately, stock markets are driven by corporate earnings which are improving.

Commentary for Financial week Aug 8-12

Wall Street's gut-wrenching turbulence in the last six trading days has sent many investors into a state of paralysis, watching helplessly as the Dow Jones industrial average free fall 520 points one day only to soar 430 the next. Baron Rothschild, an 18th century British nobleman, once said "Buy when there's blood in the streets, even if the blood is your own." Rothschild made a fortune buying in the panic that followed the Battle of Waterloo against Napoleon.  And there is no further shortage of contrarian investing advice out there. One of my investment idols, Warren Buffet once said “Be Fearful When Others Are Greedy and Greedy When Others Are Fearful” and being one of the richest men in the world, his returns show no lack of proof of his financial abilities.

So with fear running rampant on Wall Street this week, is this the time to buy? Well that depends on which camp you are in. Double dip or sale, if you believe that we are going in a double dip though unlikely then I say cash and safe havens such as gold, blue chip stocks and fixed income is the way but if you think this is the sale before the next leg of this bull market then take Cramer’s advice and buy on the panic sell offs.

Now I don’t believe we are staring down the barrel of another recession but I just don’t see any major catalyst to kick start the next leg of the rally. This puts Wall Street in a sort of financial limbo, where traders don't know whether to buy or sell  into the insane volatility seen this week. Equity bottoms tend not to occur when there is still a glimmer of optimism, in    Rothschild’s terms there still isn’t enough blood on the street but with over 4 Trillion dollars leaving the markets since the start of this “crash”, the falling knife is only a couple sessions away from hitting the floor. 

 The bottom line is the market is trying to discount all of the worst negative scenarios which have yet to occur, We need to see the European Central Bank and US Government take firm leadership and provide some substance to alleviate the fear  factor...and I think that's coming.

Double Dip or Sale? Daily Rant Aug 5, 2011

Baron Rothschild, an 18th century British nobleman, once said "Buy when there's blood in the streets, even if the blood is your own." Rothschild made a fortune buying in the panic that followed the Battle of Waterloo against Napoleon.  And there is no further shortage of contrarian investing advice out there. One of my investment idols, Warren Buffet once said “Be Fearful When Others Are Greedy and Greedy When Others Are Fearful” and his returns show no lack of proof of his financial abilities.

 

So with fear running rampant on Wall Street is this the time to buy? Well that depends on which camp you are in. Double dip or sale, if you believe that we are going in a double dip then I say cash is the way but if you think this is the sale before the next leg of this bull market then take Cramer’s advice and buy on the panic sell offs. However, there is an imminent problem, where is the catalyst? Now I don’t believe we are staring down the barrel of another recession but I just don’t see any catalyst to kick start the next leg of the rally. This puts Wall Street in a sort of financial limbo, where the bears are at their best but the bulls are still kicking and screaming as they go down.

 

Equity bottoms tend not to occur when there is still a glimmer of optimism, in Rothschild’s terms there still isn’t enough blood on the street but the falling knife is only a couple sessions away from hitting the floor. 

Gold Bears where is the downside? Daily Rant Aug 4, 2011

Gold bears, where are we really going? There are some markets that I understand that valuations can be skewed and there is therefore both buying and short-selling opportunities but I don’t understand how the precious metals market is one of those.

 Rather than take the near to long-term outlook think the reverse. Basic economics says that anything with a finite supply with continuous or increasing demand for it, will appreciate over time and doesn't gold and silver fit that description? Unless we find a new planet made of gold we have a finite supply on earth and with rapid global population growth, gold could appreciate to significantly higher levels from here.

With price targets on gold ranging from $1800 by the end of the year to $3000 by 2015, I don’t see much downside catalyst or sentiment for gold to stay at these levels or much lower. Now I will concede that gold will see weakness if the dollar strengthens significantly but like I said before basic economics point to higher gold. So my question lies in why are there Long-term gold bears in the market? And if you are one please post a comment below so I can understand your reasoning and so we can both learn. As far as today’s price action I would say that the bears won the battle but not the war. 

Introduction

Hello subscribers and accidental finders, it is my pleasure to introduce you to my blog which will complement my weekly newsletter, Fresh Look at Wall Street. On this blog I will post my commentary and opinions on all market actions that I think are interesting and important. 

So what can be expected from this blog? My daily thoughts, opinions and reactions to market news and moves also newsletter articles will be posted one day after the weekly e-mail release. To subscribe to the newsletter send an email to freshlookws@gmail.com with the email of the desired account.
So please enjoy and thank you once again for visiting my blog and please subscribe. 

But as a disclosure I do not and am not soliciting any broker or company. All brokers or company stocks discussed in this blog is based on my own analysis and posted as a journal of my own thoughts to benefit my readers and subscribers. Any positions or market methodology discussed may or may not be acted upon through my own accounts and are not a recommendation to any reader of this blog as I am not a licensed financial analyst or financial adviser.