on hiatus for a bit, site recommendation

sorry i haven't been able to post a message for a bit, but i have been getting slammed at work.. here's a good website that has a good daily technical analysis of the general market and some trading ideas. be sure to check back regularly for new ideas when i get back my regular life =)

http://www.alphatrends.blogspot.com/

NBR + good website link

Quick post, have been rather busy with work. I will reiterate my belief in NBR, which is now trading only 3 pts from its 52 wk low. The risk-reward look good here in terms of potential drops vs potential raise. Oil drilling/service got hit particularly hard last week, but I think this is a good time to buy a few shares. However, be cautious in this market though and don't buy all at once, with all the fed governors and "Uncle Ben" speaking and kicking the topic of inflation thru this week and the PPI/CPI being released in mid-week. It is kinda scary when a good CD is now outperforming the SP500 YTD.

This finanical blog got recommended in Barron's this week. Interesting blog, check it out.
http://knighttrader.blogspot.com/

Tough markets

Between inflation worries to the slowing economy to a massive US trade gap to high commodity prices to Iran to potential bird flu... AHHHH, makes me wonder whether I should pull all my money out and hide in a bunker somewhere.

Today's market is tough. It doesn't seem to be as easy picking stocks as it used to. However, here's what I'm thinking in each of the following sectors.

Retail: It is hard to dissect this sector because no one know how the typical consumer can stand up to expensive gasoline. Also, I read a Barrons article that $750 billion in mortgage-equity withdrawals were made in 2005, and approximately 50% of this flows back into the economy. This represents 5.8% of the US $13 trillion economy. With the rising interest rates and softening housing prices, consumers may not have as easy of an ability to access their home's equity. I am trying to look into the higher-end luxury retail, which includes COH and JWN. However, I'm weary whether they can buck the trend when the other retailers like WMT and TGT faces pressure.

Financial: According to the Morningstar article below, Mastercard's fair value is at $80. While I'm not sure if I am that optimistic, I actually believe there's another good reason to look at this stock. It is current trading at 15.65 PE and 0.86 PEG, vs AXP's 18.78 PE and 1.42 PEG. Of course, AXP is more than just a credit card processor, but when compared side by side, MA doesn't look too bad. http://news.morningstar.com/article/article.asp?id=164365

Biotech: In addition to CERS, I will add GILD to the potential list. They developed the drug Tamiflu. Also, their HIV drug, Truvada, is supposedly to be in high demand because it has almost no side effects and requires patients to take only a single pill once a day. They hit my screen because of the recent upgrade by JP Morgan, but will have to do more research.

Another set of interesting stocks:
- TTM, an automotive company in India, saw vehicle sales in May jumped 45% from a year earlier. Play this one with caution though, as it may get dragged down by the liquity outflow from the emerging markets.
- SPWR teed off a lot of investors by offering 7 millions shares at $29.5. However, with high energy cost and a supposedly better solar cell (SPWR's solar cell is 25% more efficient than typical solar cell, according to a statement made by the CEO of Cypress, SPWR's parent company), this may be a good time to nibble.
- GLD may not generate the exciting +/- 5 to 10% spike that NXG and EZM does on any given day, but if you believe in the gold story, this will get you in holding the actual metal without worrying about management or workers or any number of issues plaguing mining companies at any given point.

No ideas, need to do research on retail, financial, biotech

I've been swamped lately, haven't been able to get a chance to look at potential stocks. The goal for me now is to diversify the portfolio and add something from the non-energy category. I do have ideas in the various sectors. I will research and update on the weekend.

retail: COH, JWN, JCP. The last two reported good sales in May despite of high gas prices
financial: LEH or one of the investment banks, MA. Morningstar had an article out about MA that it could double from its IPO price.
biotech: CERS. I am very clueless in this sector, but CERS looks like an interesting play. It work with blood safety technology and was featured in BusinessWeek a couple of weeks back.

I am still in a watchful mode on the stock market, especially when it spikes up and down on every piece of data released.

OT, but it is kinda bizarre that my watch list of EZM and OXPS has performed better over the past couple of weeks than my current holdings..

VLO in, additional info on NXG

Bought VLO at 60.85. Should've look to enter below 60 but didn't have much time to analyze and make the trade until Friday.. S&P has a target at $77. Not sure if I'm that optimistic, looking to exit this around 70-72. Stop at 56.

I mentioned NXG earlier. They issued a press release Thursday afternoon announcing new drilling results at their Young-Davidson mine. On the news, it jumped about 5% afterhours and another 4% on Friday. I am still not sure if I should be buying this yet, considering the AZK aciquistion is still pending. If the deals goes through, this will increase the number of shares in NXG by 107 million shares, almost a 50% increase from the current outstanding 214 million NXG shares. Also, AZK ended trading Friday at $2.91, which is still a slight premium to the NXG offer of .741 NXG for each AZK share. I may accumulate a little bit if it gets to $3.5-$3.6.

VLO interesting, CHK dangerously interesting

Quick post.. When you saw those tickers in the post's title, you must think I'm crazy for thinking these when the whole energy sector is getting slammed. But then, hey, this is when you look to establish a position in good stocks.

VLO - Largest independent refiner in North America, can refine the cheaper heavy sour crude, great management, stock buyback underway, trading at 9 PE present and 8.24 future PE, when Yahoo Finance indicates the Oil and Gas Refining Industry average PE is 10.91.

CHK - Natural gas play. Great management with insider buying. This may be a bit tricky because of the mild winter in the US last year and an already large natural gas storage (rumor that at this pace, they may run out of storage for the natural gas later this summer). But then, with natural gas prices so beaten up already and a predicted active hurricane season, this may be worth a look.

AMTD in, EZM out, and NXG interesting..

Quick break from work ... My last post mentioned OXPS and AMTD as potential buys. I decided to wait on OXPS and bought AMTD at $17.11. I had a chance to buy in OXPS at ~$26.5 but I read a bearish S&P report that it will stiff competition from the other brokers and its margins will compress over the next 12 months. Hoping this isn't a mistake, but OXPS now in a holding pattern..

EZM popped from a close of $2.1 yesterday to a high of $2.46 mid-day with the commodities price spike today (Copper was above the $3.8 mark at one pt). As much as I like EZM, this bounce is unnatural (yeah, the alarm hit my head pretty hard this time around). Sold at $2.44, looking to buy back in the $2.1's. Still believe this is a potentially good company.

NXG is a stock that I used to own (and made a very bad mistake on, which I'll write about in a future point). Today, they announced they will acquire AZK for C$3 in a share swap. NXG is down ~4% in a fairly bullish day for commodities stocks. However, if NXG can pull this off without being rejected or thrown into a bid war, NXG may be a good play. One of the biggest worries investors have with NXG is that their Kemess-South property will run out before their Young-Davidson or Kemess-North can be brought up to production. With AZK's upcoming production at the Casa Berardi mine later this year, this will fill the gap and line up a set of producing properties for NXG. Add in NXG's great management, this could become the first stock that I will buy and hold onto for long term. I am waiting to see how this shakes out. AZK is now trading above the takeover price ($2.91 or ~C$3.25 in afterhours), so NXG may be pressed to raise the bid. I hope NXG had been accumlating AZK before this announcement..

Lesson Learned - Seizing opportunities

This is sure to be the first of many lessons I will need to write up.. Seize opportunities..

About a month ago, I saw a mining company called Eurozinc (ezm) pop up on the IBD Top stocks under $10 list. After digging around and listening to a conference call, I found out this company is mining copper (hot commodity) and will start mining zinc later this year (EVEN hotter if projected shortage holds for 07). From that, I traded and held holdings from under $2 to $2.1.

On 5/11, Jim Cramer on his Mad Money show featured this company but for a rather shady reason, that since RTI just signed a contract to sell Titanium to Airbus and Eurozinc is one of RTI's supplier, that Eurozinc will receive some "pin action" (which I think is bogus because they call copper/zinc a commodity for a reason: it doesn't matter who dug them out of the ground). To add on to the suspicion, he featured the stock on the day where Eurozinc announced rather disappointing earnings at .03/share (one analyst had it at .08/share) and the stock has dropped from its yesterday's close of $2.98 to $2.66, but he stated that this would be a good opportunity to buy on the dips.

After he featured the stock, it received a crazy Cramer spike of 20% to trade to a high of $3.22 afterhours, an all-time high for the stock. Alarm bells did go off in my head and I proceeded to sell ~40% of my holdings in afterhours. While this is a good decision, I believe I still made a mistake in not seizing the opportunity and selling more/all of it. From Kitcometals, Thomson projected it will earn 27 cent for 06 and 32 cent for 07. With the earnings miss, I should have seen that this stock was trading close to its future valulation (balanced with the potential future miss), take profit, and buy back on the dip.

Well, one week later, compounded with the commodity correction that took place, it went to as low as $1.85 before bouncing back to $2.16 at Friday's close.

Lesson learned here, seize opportunities. In my opinion, a 50% pop in initial investment would have set off bells of an experienced investor that it's time to take the money off the table. If that alarm wasn't loud enough, a Cramer pop of 20% should have smash the alarm over my head.. I am now setting firm stop and sell points for my stocks and will only move them if something is really, truly moving the fundamentals of the company.

Stock of interest - OXPS, maybe AMTD

Recently came across an article from Dow Jones news titled "Volatility a Boon to Options Exchanges". Quick summary, the Chicago Board Options Exchange noted its SP500 Index Options traded at a record 1 million contracts on Thursday and the International Stock Exchanges (ISE) saw more than 3.8 million contracts change hands on Wednesday - its 2nd highest volume. The ISE Chief Executive stated in a conference call that trading volume for the entire options industry is to increase when the market returns to higher violatility. The article then comments on that the violatility is inspiring some investors to buy put options to protect against further stock declines and that traders are selling options to take advantage on the rise in price that comes with increased violatility expectations.

All in all, regardless of who is trading what, it sounds like more trading = more commissions! Quick picking through the different plays, I come across OptionsXpress. They are highly rated for their stocks site and execution, and their numbers for April 06 shows that their daily avg revenue trades is at 31500, 89% higher than April 05 and 18% higher than March 06.

The concerns I have though is that the stock looks weak (broke 50-day, 100-day moving avg), 200-day is at $25, stock is already up 100% over the year, its seems to be stuck in a trading range that tops at about 32, its PE is higher than its competitors, and competition from other active trading services such as Tradestation, Power Etrade, and Ameritrade Apex. It's up 1.75% today but at a slightly sub-3 month avg volume..

Another interesting note, OXPS increased accounts 3% from March 06 whereas AMTD added less than 1%. Also, OXPS has 184k accounts with 4.2 billion assets and 125 million margin balance, AMTD has 6.1 million accounts with 266 billion assets and 7.9 billion margin balance.

I need to do more research, perhaps listen to a conference call, but this could be a nice buy. They have a shareholder's day on Wednesday morning.

I also have been looking at AMTD with the recently pullback lately. However, something spooks me about this stock (I heard they were slow in lowering commission/margins to be competitive,, not sure how the merger with TD is going to shake out, and they're giving $500 to sign up for Apex!?).

First post - Introduction

After funding my stock account in last year, I have come across numerous lessons that seems to repeatedly rear their ugly heads during my weakest moments (ex: pick any of the days over the past week during the commodities correction) and cost me to make some extreme mistakes. Instead of tattooing those lessons to my forehead to remind me of them, I figure it may be easier for me to write everything down and use this blog as a reinforcement (besides, I'll probably have to shave my head and use part of my chest to fit everything in if I chose the first route..). I apologize if this sounds a little self-serving, but I hope that by sharing my lessons and picks along the way, I may be able to force myself to make a good case before buying any particular stock and lessen the errors that cost me and, most likely, many other novice investors. And, of course, any comments and advices (and even criticism) are greatly appreciated, as long as they are above a basic decency level (no profanity, insults to other posters, etc).

First order of busines, I have a disclaimer. I am a novice trader, so please take what I write with a healthy set of skepticism as I am still learning new lessons from both the market. I am also a novice blogger. If I make any mistake along the way or stray outside of blogging conventions, please let me know. I tend to run toward risk in my stock picking and portfolio. To me, a stock account should be used to attempt to leverage a high rate of return; for a moderate and safe rate of return, I believe the CD and bonds rate today are competitive and a better way to go. More detailed disclaimer at the footer of the page.

Again, please feel free to let me know how I can improve both as a trader and as a blogger. Welcome to my blog.