Buzz Bits: Dow, Nasdaq Giddy In Green
Your daily Buzz & Banter highlights...
One dog goes one way, the other dog goes the other way, and this guy's sayin', "Whadda ya want from me?' - Todd Harrison - 3:52 PM
I hear ya Tommy, there seem to be crossed looks all over the street today. The bulls are wondering why Wal-Mart sales didn't spur the herd (or, Wal-Mart for that matter). The bears are curious why the lethargic financials (Goldman Sachs notwitstanding) and Venezuela didn't weigh on psychology. Meanwhile, the tape is tracing out a nothing day on light volume.
One of the first things I learned---but something that took me years to put into practice--is the ability to "know thyself" and trade less when unsure. There is a fine line between that and the "proactive patience" we strive to acheive and, indeed, I'll likely scrunch my nose if I suffered from premature evacuation on (the halving of my) S&P puts.
As I said earlier, there's no looking back--profits reside in looking forward--so I'm taking a deep breath as we edge into the close. Make no mistake--this is a tough tape and anyone who says otherwise (or pretends to know, with certainly, where we're headed) is likely someone you should filter out of your process.
I'm gonna flip lids into the close and attempt to nibble on that inbox before the next best meld and tonight's Bones show. Area Minyans are welcome to attend as, well, we're a community and that's what we do.
May peace be with you.
What's the Good News? - Adam Michael - 1:50 PM
BPZ Energy (BZP) reported a successful oil test today. This is very positive news for the company, and I expect the results from this well to be revised upwards as additional tests are performed over the next two weeks.
The stock has over 4.5 million shares short which could add additional fuel to the fire. Why so many shorts? BZP has a $400 million market cap but no production (yet). I expect the company begin oil production in the Corvina field by year end. By this time next year, I expect the company to be producing 8,000-10,000 BOPD (barrels of oil per day).
BPZ has a land package in Peru of several million acres of highly prospective land. This stock will remain volatile until production (and positive cash flow) begins, but I would not be surprised to see a market cap north of $1 billion in a year. I am headed down to Peru tomorrow on an analyst trip to check out the company's assets and will have a full report for the 'Ville when I return late next week.
Position in BPZ
Spotlight on Gold - Lance Lewis - 9:32 AM
Note spot gold is breaking out above its downtrend since the April peak and is now set to challenge the key $700 level as soon as tomorrow.
Click to enlarge
Also note the GLD gold ETF inhaled a whopping 13 tonnes yesterday, bringing its gold holdings to a new all-time high of 528 tonnes. Other than the first few days of this ETF's inception in 2004, this ranks as the 6th largest one-day gain behind some 14 to 18 tonne one-day additions that occurred in January of 2005 and 2006, which were most likely merely large beginning of the year-type allocations to gold.
Yesterday's large purchase, however, appears to be even more significant given where and when it has occurred (outside of this January timeframe), and I read it as extremely bullish. It's also precisely what we would expect to see given that we are expecting gold to benefit from the Fed being forced to ease soon.
Position in gold shares
View From Q - Quint Tatro - 8:25 AM
Good morning Minyans. While you're sipping on that coffee and catching up on the news flow, here are some ideas to consider for the day:
Boo continues to have the upper hand as futures are pointing to a lower open and traders await some more economic data. The arguments are strong supporting a continued decline however I am allowing the individual charts to be my guide and so far I am still holding my ground and not heading for the hills. Many of my existing positions, are holding well and until they break below my stop, I will let them do their thing.
Solar stocks have been hot recently and I am inclined to think they may not be done with their run. I am watching Ja Solar (JASO) which has started to consolidate around the $36.00 level quite possibly preparing for another leg up. Typically, I would remain patient with a play like this, with one eye on the 50 day moving average. Should the stock dip to this level, I may take a starter position and continue to watch it closely. If it fell through my purchase price, by the close, more than likely I would take my loss and move on, however if it held the key moving average, I would be encouraged and look to add more. I would like to see the stock consolidate a bit more in this area and then surge over the short term high of $38.66 on volume, at which point I would add another piece. Similar formations can be found in Ascent Solar (ASTI) and First Solar (FSLR) all of which are high on my watch list.
I think the key at this juncture is to take it slow. If you have enjoyed gains over the last few weeks, don't be afraid to book some in order to protect profits and keep exposure low. Should stocks advance after consolidating the recent run, you will have ample time to redeploy.
Go get 'em today.
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