Coiling

BVN, a Peruvian mining company came back from the dead in January of 2016. After bottoming at $3.27 it rallied almost 400% in 8 short months. As you would expect after such an enormous run, it needed to take a rest, consolidating sideways for the last 17 months, allowing those wanting to sell the opportunity to do xo. But after this long sideways journey, the selling is waning, price has formed a cup and handle continuation pattern and is coiling above its rising 200 day moving average. A confirmed breakout above the pattern’s neckline points to a target in the $22-3$23 range, some 40% higher.

Risk management is easily controlled as it would make no sense to hold on to the position if it closed below the prior low of 14.13. If you really wanted to give it more room, a break of the 200 day moving average would be my final exit point. Either way, the risk-reward ratio is well above the desired 3:1 target and as such provides a compelling opportunity.

February 2018 Charts on the Move Video

February welcomed back volatility and our first double digit decline in many, many months. February also marked the end of the intermediate term parabolic blowoff and points to further consolidation in the coming months as I discuss in my latest video

https://youtu.be/aec4QquCfUk

The Market is Crashing .... or Not

Like everything, its a matter of perspective. Top pickers continue to call for a market top and hunker down in the "safety" of zero return cash or bonds whose value is declining due to rising interest rates.  These are the same people who have accurately predicted 17 of the last 3 corrections. They may eventually be proven right but tops are only known after the fact. It’s important to listen to the market and interpret what it is saying rather than react to human emotions.

I have to ask, is the chart below indicative of a market that is in such a decline that you should bail out of your stock positions? Out of 70 country stock markets analyzed, ZERO are in a bear market (as defined by down 20% or more from their 52 week high). This chart helps to put into perspective today’s global risk appetite which is clearly favoring stocks. This could change at any time but until it does it’s always best to stay with the trend, ignore the noise and avoid bad investment decisions driven by emotions.

Is This the Reason for the High Divorce Rate?

This the Reason for the High Divorce Rate?

Do you think, based upon the Economists data below, if the tradition of the man giving his bride-to-be an engagement ring changed to giving stock certificates would materially decrease the divorce rate? At least they would be starting off on better financial footing (said with tongue planted firmly in cheek)

Regeneron – The End of the Bull?

Regeneron, REGN, makes a compelling example of allure of biotech stocks for investors. After breaking out higher in 2009 from a multi-year base, it’s stock went on to post gains of more than 5000% in 5+ years, peaking in August of 2015. Since that time, it has declined almost 50%, something difficult for buy-and-hold investors to experience, unless they got in real early and are still positive on their positions (which only makes it slightly less difficult).

Notice how in 2015 the stock eventually fell below its rising 200 day moving average, bounced off of (green) support and made one more attempt to move higher. That next move higher failed and made a lower high and has now broken below the black uptrend support and once again fallen below (a now falling) 200 day moving average.  Price sits at the bottom of support and a continued probe lower and hold below will likely be the trigger that REGN’s uptrend is done (as in put a fork in it) and to expect much lower future prices. Take note and memorize what has occurred as this is a classic long term topping pattern that most all investments mirror when their bull run eventually ends.