Tech Stocks - Alibaba (BABA) and China/Semiconductor Stocks Updated/Fixed for fonts

Tech Stocks - Alibaba (BABA) and China/Semiconductor Stocks

First disclosure - We missed this bubble and are really upset that we missed it - made money in the last two bubbles but did not see this one even though it was staring us straight in the eyes. But this was an important lesson learned and a very expensive one at that. We missed many amazing stocks and that is what upsets us the most.. Truly disappointing..

Now back to the markets:What a run up - absolutely amazing - it was a classic up move from a huge pullback from earlier in the year. Every stock was just going up, up and up. There was no stopping the BULL train and indices hitting new highs - many stocks hitting new highs - company valuations crossing $1Trillion - bigger than the GDP of many nations put together.. Yet not one analyst or talking head or journalist (except that 1%) were willing to utter the word BUBBLE. New startups being valued at numbers that exceed the 2000 bubble, funding at levels not seen even in 2000 - Idiot Masayoshi - raising 100B funds like candy.. These are the signs of bubbles - not a single soul is scared or even concerned - margin debt at all time highs. P/S of companies at records - companies making no money being funded as they are going to make BILLIONS.. We have to say these are all signs we have seen and witnessed before and these never end nicely.. We have become addicted to bubbles and we have now perpetuated 3 within a span of 18 years - that is unheard of. Massive money printing and FOMO amongst the VCS, the investing public and machines doing the trading has led to this excess of massive proportions. There is not a single day when a company is going public - which is a sign the smart money (VCs) are cashing out - while everyone is high and drunk.. Some examples of stocks trading at ridiculous P/S - NOW - over 18x P/S; ETSY - over 14x P/S; and there are many more. The numbers of companies trading at these type of valuations is absolutely staggering. And every new company has now a valuation above $1B - it is an absolute joke - NVDA trading at over 170B market cap and P/S of over 15 for a semiconductor company - that is unheard of in the history of semi companies. Full disclosure - we are short NVDA.Here is a comment from ex CEO Scott McNealy from good old Sun Microsystems which eventually went out of business: read the words - they are actually amazing from a valuation perspective:



Anyway we can go on and on and now the 10Y Treasury is yielding over 25 bp over 3% and heading higher. Housing bubbles are cracking in many parts of the world - India, Australia, Canada, Hong Kong, New York, Denver and many other locations are starting to breakdown from this incessant building of homes and apartments (flats as they are known abroad)You can only blow a bubble so big before it eventually explodes.. And the Fed and the world are all addicted to bubbles. We have huge issues with pensions all around the world - debt to GDP ratios at extremes and student loans, auto loans (with high car payments ever and highest number of payback years). Credit card debt at extremes and everyone is loaded with debt - this is unsustainable. The Indian banking system which was flush with loose money and corrupt insiders is now unraveling at a rapid pace and the INR is dropping to record lows while the markets are finally coming down. We think there may be a reset - do not know when and how - but something has to give because we have gone past the limits of what makes sense. It would have been better if the central banks had a good plan and approach to the crisis and managed it in a much slower and better fashion - but that is not what happened - they turned on the tap at full speed and now what we are experiencing is the overflow effects with no control left. It is like unleashing a monster.. If they would have taken a slow and gradual approach we would not be where we are today - staring down another bubble.. Unfortunately we want quick fixes and have been addicted to these bubble methods - which in the end always lead to busts.. This bust will last longer then anytime before and it will not be pretty. Just wanted to pen down our thoughts this week.We would sell the stocks like BABA - broken down and many tech stocks are finally breaking the 200d SMAs (some have already done so and have gone down since - look at MCHP and now we expect the same for TXN and BIDU etc.) So buy and hold works great when everything moves up in tandem but fails when things go sideways and/or start to breakdown.. We will update more next week. We are recommending short on ETSY and ROKU.

There is some exciting news coming from our site/platform - keep tuned..Good luck trading.

Founder Trucharts.com/Co-founder JETSTOX.com 

Do we keep buying or sell here..

Trucharts Blog 8/24/2018

Do we keep buying or sell here...

Such a conundrum buy or sell. Stocks keep moving up on the Nasdaq - this is very reminiscent of the 2000 bubble - the Dow Jones moved up first, stagnated and then the NASDAQ took over. We are seeing so much froth - in all stocks and at prices that are exhibiting absolute bubble characteristics. But yet stocks keep moving up - and we believe this may be driven by FOMO and central banks seeing the US economy as strong and buying stocks - think about that central banks buying stocks. Never has that happened in the history and ever since central banks have been in existence - money printing has become the norm and no longer an exception. Risk metrics are being thrown out the window and the predictions are getting frothier each day as if there will be no event that will kill this bull market. Valuations for all metrics are at the highest ever and yet there is not a sign of even a single bear on TV. Just run a check on price to book and price to sales along with PE screeners and you will see what we see as the most frothiest market ever. Every deal is getting funded and VCs are raising funds at an unprecedented levels. Everyone is an investing genius when all assets are moving up.. Very typical behavior at the top of bull markets.. You can never call a top until all leading stocks start breaking down.

Anyway - that was a short treatise on our thoughts as to where we are in this stage of the longest bull market in history. We are witnessing one of the biggest bubbles - and we do not know when or how this will end. In this market a $10B market capitalization is considered to be very low. Companies like VEEV, NOW, ALGN, and many others have revenues of no more than $2.2B but their market caps exceed over $78B - total annual revenue for these companies - $4.7B - so the multiple is - 16.59 - so for every dollar in revenue - people are willing to pay $16.59 - hmm - and the Fed says there is no bubble or folks come on TV and say - it is all great - bubbles are made this way.. 

On another note - marijuana stocks CGC and TLRY are trading at P/S of over 150 - so people are paying $150 per ever $1 of revenue - TOTAL MADNESS.

But these thoughts aside, we know this is an excellent market for trading and making money on a short term basis and also by the use of options or intra day or even from day to day trading. We are seeing machines doing a lot of the trading based on very elemental trading signals and this tells us that fundamentals do not matter - no matter what anyone is saying - there is froth, technical trading and money is being made at a frantic pace..

Using options or put spreads for stocks that are moving sideways or are in an uptrend is a very good way to generate income on your portfolio - candidates for these type of spreads would be CAT, DE, EA, IBM, ATVI, MNST, QCOM, INTC. 

No charts this week but checkout some new features on our site like our dynamic screener at with multiple options for screening:
http://www.trucharts.com/drpScanner.aspx

Our single variable scanner at:
http://trucharts.com/Scanner.aspx

We are planning to go long BIDU, EA, QCOM and INTC. We are heading into the AAPL announcement in September so you can be long stocks supplying to AAPL - like IDTI, INTC and others.

Good luck trading - check out our buy/sell signals on our page http://trucharts.com/Stockcharts.aspx

Subscribe and get access to all our features along with notifications..

Good luck trading.

Trucharts Founder

Greece Referendum - How will markets react this week? Trucharts.com Blog - week ending 6/26

Greece Referendum - How will markets react this week? Trucharts.com Blog - week ending 6/26

Well looks like our call on the weakness in the underlying fundamentals of the markets are finally coming to fruition. Earnings from ORCL (ORCL chart), Micron (MU Chart) were pointing to a slowdown in the tech sector - which we alluded to in our blog. 

We stated to take profits and hedge your positions with covered calls or puts a month out for a strike price 5% to 10% below the current prices, for some protection to the down side. INTC - chart below (weekly):

As you may have read in the news INTC is planning layoffs and with the MU news of slowdown in the PC sector we expect that INTC will very likely state the same. The ALTR buyout was primarily to fill their old fabs and they paid a hefty price for ALTR. Seems like a sign of desperation. We will be shorting INTC tomorrow.

Then this weekend we have the news from Greece calling for a referendum. We think the Greek leaders are doing the right thing and letting the people of Greece decide the fate of the country. The creditors are not happy but the choice of cutting back benefits/pensions significantly and hurting the people of Greece is not to be left in the hands of the a few politicians and the Germans. We will have to wait and see how Greece exits the Eurozone - we think they may have already made that decision.

We expect volatility in the markets this week - we alluded to the topping nature of the markets for the past few weeks and how the weakness in the individual DOW component stocks, transportation stocks as a sign of topping behavior. Here is the chart for SPY and DIA (weekly) - notice the weakening technicals (RSI, Moving Averages and MACD) - SPY has not closed below it's 13 week SMA - Chaikin Money Flow is still positive - the next two to three weeks are critical and we have to see if the SPY can hold or bounce of the 50 week SMA. We also stated how the markets have been playing the round number games with the Dow Jones 18000 level, SP500 2100 level and 5000 for the NASDAQ for the past 6 weeks with three digit moves every week.

SPY Chart:                                                            DIA Chart:

SPY support at 208 and DIA support at 177. Here are the daily charts - keep an eye on the moving average support lines:

 

What to do this week:

1. It is going to be a shortened trading week very likely with low volumes going into     
    the weekend because     of the 4th of July weekend.

2. Sell some covered calls and buy some protection - we are heading into earnings      
    season.

3. Take some profits as we stated earlier - nobody is going to complain or regret 
    locking in some profits.

4. Watch critical support levels for your stocks - you can do this easily with our charts 
     support resistance option on the stock charts page.

Our positions: Long BIDU, CYBR, Z, - short INTC/AMBA. All positions hedged with calls and puts.

On another note here is the chart for IBB ETF (Biotech stocks) - just see it's support level at the 13 week SMA - unbelievable.

We added new features to our site - a quick chart box on the home page and a new chart skin color scheme on the stock charts page - check these out - nice new features to have. The charts we are showing are with the new color scheme.







Some articles for good reading:

http://techcrunch.com/2015/06/26/the-tech-industry-is-in-denial-but-the-bubble-is-about-to-burst/

http://www.businessinsider.com/stock-market-is-a-petri-dish-2015-6

http://www.nytimes.com/2015/06/27/business/international/chinese-stock-indexes-plunge.html

http://www.zerohedge.com/news/2015-06-27/bad-breadth-milestone-warning-stocks

http://www.zerohedge.com/news/2015-06-27/chinas-370-billion-margin-call

http://www.econmatters.com/2015/06/chinese-stocks-how-to-think-like.html

http://www.zerohedge.com/news/2015-06-27/desperate-china-cuts-key-policy-rates-after-stock-market-crash-its-just-1987

http://finance.yahoo.com/video/risky-buyers-making-comeback-housing-233326345.html

http://www.zerohedge.com/news/2015-06-28/ecb-says-greek-bank-holiday-now-necessary

http://www.zerohedge.com/news/2015-06-27/moodys-fitch-fret-over-billions-student-loan-abs-defaults-loom

Positioning your portfolio - Summer 2015 and Markets Direction - Blog Trucharts.com

Trucharts.com - Market positioning and where markets are for the summer - Blog Update for Week ending 6/19/2015

Well we guess by now you are all used to the volatility and jerky moves in the markets for the past few weeks. Markets that move sideways for a long period of time are either topping, consolidating, and what we call confused markets. For the past several weeks, we have been seen these wild 3 digit moves up and down and primarily the markets holding the 18000 for the DOW, 2100 for SP500 and now 5100+ for the NASDAQ. This has been occuring every single week. The Russell 2000 hit a new high as did the NASDAQ and everyone is ready to party like its 1999. 

Market pundits are trying to justify why the market valuations are low compared to 2000 - but some of their points sound absurd. Granted there are companies with good earnings and low PE ratios - but these are few and far between. Zero rates from the Fed, market speculators, big firms and heavy stock buybacks are the reasons driving this market and we have shown several examples of charts that look like exponential chart patterns. With everyone chasing performance and yield, stocks have been the only game in town and therefore we are seeing astronomical valuations for many companies - especially in biotech and stocks that are up for no reason (check the charts for stocks (for last 7 years period) like UHAL Chart; SHW chart; AMBA chart; IBB chart; REGN chart and many others. 

Here are the charts for DIA chart, SPY chart, IWM chart and QQQ chart from the week ending 6/19. You can see the DIA and SPY have not broken out yet and based on the market internals, we are seeing some fundamental weakness in the Industrial stocks, Utility stocks and the individual DOW component stocks - just check here the DOW 30 stocks with the mouseover charts feature: here is the link - DOW 30 stocks - check each chart and you will see how each of these stocks are doing currently.  

As we write, futures are up as Greece is trying to avoid printing drachmas and stay within the Euro zone. This is like the never ending story - it is like a soap opera - with the Greek Prime minister and the finance minister playing lead roles and the Germans are getting tired of it - but do not have a choice but to deal with it.

What should you be doing now: 

We would take a very defensive posture here and take some profits in profitable positions and sell some covered calls, and to protect downside risk with buying some puts on your positions - maybe 10% below (strike price) the current price - these are cheap, knowing that the volatility (VIX) is low and the puts would be cheap insurance. We typically hedge our positions as long and short and try to keep our portfolio balanced. We definitely still think there is risk here on the downside. 

NASDAQ is being hitting new highs primarily because it is being driven by the biotech stocks. These stocks may still go higher, but as they do, so does the risk. In addition, many new IPOs are healthcare related and biotech focused. We would be wary of trading these - unless you have the stomach or risk profile to handle volatile stocks. 

From a stock perspective, we are long BIDU, CYBR, Z, TWTR - we like MO, PM here for short term trades. We missed BTI at 104 (major support). We are short AMBA, and INTC.    
Here is a recap of some of the interesting articles we liked and have provided the links here:

What is the meaning of a "dry-bubble" to VCs?
http://www.zerohedge.com/news/2015-06-17/silicon-valleys-fantastic-dry-bubble

China bubble news:
http://www.zerohedge.com/news/2015-06-20/so-you-think-you-are-rich

California Drought:
http://www.zerohedge.com/news/2015-06-18/california-has-never-experienced-water-crisis-magnitude-%E2%80%93-and-worst-yet-come

TSMC and AAPL news - very interesting read and outlook on semi stocks:

http://blogs.barrons.com/asiastocks/2015/06/18/even-apple-cant-save-tsmc/?mod=yahoobarrons&ru=yahoo

Till next week. 

Good luck trading.

Markets Direction - Up or Down? Where are we headed? Trucharts.com Blog Update

Markets Direction - Up or Down? Where are we headed? Weekend Blog Update week ending 5/29/15

We have not had a chance to do a weekend update due to the jet lag from travel and other pressing matters. Finally getting some time to put my thoughts down related to the markets from the past 3 weeks and heading into the summer session.

Well NASDAQ hit a new high, markets moved higher and many earnings were reported. Avago bought Broadcom - a $37B acquisition (we think they paid too much - almost 5.5x sales) and then we have Intel buying ALTR this week - from an earnings we had HD, LOW and many other companies that reported earnings in the past couple of weeks. ULTA also reported but the stock reversed after reporting its earnings as did HD. There is talk of additional mergers in the semi company space - here are the companies that we think are ripe for consolidation - MXIM, IDTI, TXN, SLAB, MCHP, ADI, NVDA, AMD, SWKS, MRVL, XLNX, AMBA and probably many others we are missing.  Keep an eye on these stocks. NXPI, AVGO, INTC and other big semi companies would be possible acquirers. With the AVGO and BRCM merger - the merged company will be the 3rd largest semiconductor company after INTC (1) and QCOM (2).

Our drug stock picks LLY, MYL and TEVA still holding strong. The biotech sector has been holding the NASDAQ up and we expect that this sector will eventually fall - we just cannot predict when - there is technical weakness in the ETFs in the biotech sector.

We are very concerned about the underlying weakness in the markets - structurally. We are seeing many stocks breaking down in the DOW and S&P500. In addition, stocks are reversing after reporting earnings - check HD, ULTA. Housing stocks are dropping - indicating that the markets are anticipating rate hikes from the Fed. We think the Fed sees an asset bubble and are being left with no choice but to start raising the Fed funds rate. Housing prices are moving up. unemployment is down to 5.3%, homes on the west coast are selling at prices higher than asking - and this has been the longest period for the rates being at near zero - now close to 6+ years and over the past week we posted an article on FB and G+ where Byron Wein discusses how the Fed has pumped over $3T into the markets - we concur. And then we see this article over the weekend:

- http://finance.yahoo.com/news/robert-shiller-bubble-element-were-140322037.html 

All these are pointing to over valuation in the markets and the complacency is remarkable. The VIX was down last week and we expect this to spike higher in the coming weeks. We stated that we would take profits here and hedge positions with calls and puts. Adding some shorts is in our plan for the coming week.  We are long BIDU, TWTR, Z (all hedged with covered calls) and are looking to short MSFT, and possibly IBM. 

Just take a look at the stocks that popped on our sell signal strategy here:Just sort the page by volume from highest to lowest by clicking on the volume column twice: 

http://www.trucharts.com/FilteredStocks.aspx?ConditionId=8174,8175,8176

Watch for our regular daily posts and positions updates on Twitter and FB.

Again - watch the Greek situation, China stock bubble, and sell here to take some profits and wait for a better opportunity.

Good luck trading. Check out our special subscription rates and we offer the best feature set on the web for our lowest subscription rates - here is the link: 

http://www.trucharts.com/truCharts_Services.aspx

Do checkout our backtest feature - it is the fastest on the web and ummatched by any site.

Link is: Backtest feature - play with it and you can use it to try some paper trades.

Please help by spreading the word of our site.

Trucharts founder and team

Stock Market 5/28 - Midday Update Tuesday - Trucharts.com -

Midday Market update: 5/27

Stocks are bouncing back from the drop yesterday post Memorial day holiday from a possible buy the dip philosophy and possible Greece solution. 

We doubt this move/rally and would look to sell into rallies and take profits - NASDAQ is up from the biotech stock moves and some tech stocks. We like $DE, $BIDU and went long $TIF today. Stocks getting hammered are $WDAY, $KORS and $SHAK.  We like $MO and the tobacco stocks for their dividends and would look to go long. Short gold for now.

Markets look extended still and volatility is still low. Oil is dropping. Watch SVXY and VXX.

Where are the markets headed - UP or DOWN?

Trucharts.com - Blog Update - Week ending 5/15/2015

Where are the markets headed - up or down??

We were unable to publish our blog for week ending 5/8 as we were in China due to blogging restrictions. We are going to summarize the market events for the last two weeks and provide our outlook for the coming weeks and thoughts on some trading.

Well we noticed a pattern during the past two weeks - markets would be sluggish during the early part of the week and then ramp into the end of week trading - week of 5/8 we had a huge move on Friday and last week the big move occured on Thursday. Bonds which have been crushed for the past few months (see TBT chart below) bounced back and it is currently oversold and we expect TBT to move up to its 50d SMA. This will lead to a drop in yields in the coming weeks and interest sensitive stocks should move higher - housing stocks like DHI and LEN to move higher. Markets moved higher on Thursday due to the lower retail number print and the jobless claims number. The markets are totally schizoprehnic - every data point is like a tug of war between the bulls and the bears - but we think the bulls are winning.

The indices like S&P500 brokeout to a new high last week and we expect the move higher. Check the charts below for DIA, SPY, SVXY and TNA. With the Fed pumping money into the economy and staying on the sidelines with the low or ZIRP will drive stocks higher. The Fed is stuck in a corner and we have been saying this for weeks. There is internal strife within the Fed governors and there is lot of jawboning going on the interest rate hike front. This is creating a stable trading environment in stocks - we especially like the drug stocks and stocks with weekly option expirations. The NASDAQ moves are being dictated by the biotech stocks. We expect the biotech ETFs to move higher here - these have still not closed below the 13 week SMA.

Our USO position closed on Friday, we are looking to go long BIDU,TWTR. Oil did bounce back and is back at being above $60. Gold rallied and we expect a pullback. The Greece situation has been nothing but noise. Eurozone economies did well due to the pullback in the Euro, but the markets saw a pullback last week. China is in a bubble and will not end until everyone is loaded up - there is a billionaire being made every week - reminds us of the 2000 Nasdaq tech bubble. 

We are still long MO,DNKN,BIDU and we will close our BOX position this week.

ISEE C/P ratio hit a new 52 week high on Thursday - it recorded a reading of 228 and that means over 2.2 calls were being bought for every put. This typically points to a higher market. Hedges are cheap now as volatility is low and we recommend buying some SPY puts and or puts for your positions at 10% below for 30d out timeframe.

Checkout our backtest article we posted last week for our site and also check out excellent subscription rates for full access and it is currently discounted at 50% for one year access - here is the link - http://www.trucharts.com/truCharts_Services.aspx and we would really appreciate if you can spread the word for our site - and create a buzz - we know we have one of the best stock charting sites on the web. We have updated our home page and are still adding features daily. Check these out and send us your feedback - support@trucharts.com - your feedback is so critical to help us improve our user experience. 

Closed EEM short.

Here are some articles for some good reading this week. 

http://www.zerohedge.com/news/2015-05-16/what-goldman-telling-its-clients-sell-may-and-dont-come-back-one-year

http://www.zerohedge.com/news/2015-05-16/one-gauge-investor-sentiment-just-hit-6-year-high

http://www.zerohedge.com/news/2015-05-17/presenting-77-billion-p2p-bubble

Here are the charts we are watching this week:

 

 

 


Good luck trading. 

Trucharts Team

How to trade this week after the bad jobs report?

Trucharts.com - Blog - Easter Weekend - Stock Charts Free - and more.

How to trade post Easter and what to expect?

We talked about the horrendous job reports we got on Friday in our last blog update - just a reminder the reports showed 126K jobs created vs the expectations of 226K. Futures dropped on the news and the USD dropped - gold rallied and then we had oil rallying this weekend with the Saudi's raising the price of oil to the Asian nations because of demand. In addition, we have the nuclear deal with Iran and then the war going on in Yemen - this is definitely going to impact the oil price volatility. Gold is up today over $12+.

The talking heads on TV are already trying to predict the Fed's move in Q3 and we still expect that the Fed will raise rates in Q3 unless the jobs report stays below 150K. With summer coming, we expect the jobs report to improve going forward. 

Futures are down this evening (DOW futures down -115) after recovering from a 200 point drop and everyone is already trying to predict whether the Fed is going to hold off on raising rates based on one jobs report (which we think is a blip) and should resume an upward trend next month. The weather did have an impact and we suspect hiring in the oil sector was down. 

We indicated that the earnings news has not been very encouraging and we expect that the forecast for the tech sector for Q2 will not be strong. With INTC and SNDK lowering revenue forecasts, we expect numbers to be coming down in the tech sector - recommend taking profits in this sector. We are looking to short TSM and SPIL.

Since we now have to wait till the next jobs report, we expect that bonds will rally here and yields will drop and this will help the utility and dividend paying stocks to shine at least for the short term, in addition to retail/housing stocks. We like the following stocks:

MO - (we are long) www.trucharts.com/stockview.aspx?TICK=MO
RAI - www.trucharts.com/stockview.aspx?TICK=RAI
LO - www.trucharts.com/stockview.aspx?TICK=LO
M - www.trucharts.com/stockview.aspx?TICK=M
PHM - www.trucharts.com/stockview.aspx?TICK=PHM

We are short SNDK, and long USO, BIDU, MO, TWTR. We still like TWTR and you can also check out our predefined scans report on our site at www.trucharts.com/marketreports.aspx.

Also check out our special subscription deals for complete access to our site at:
www.trucharts.com/charts_services.aspx

Good luck trading.

Trucharts Team

Bought these hot stocks today - Markets Rally today

Market Rally 3/18/2018 - Thanks Ms Yellen - Greatly appreciated 

CORRECTED LINKS..IN THIS UDPATE..

Well today's Fed output (scientific term) was all but nonsense and as expected - the markets had done a classic bear trap and sucked everybody in. Our expectation was to stay net long and our picks from our blog this past week was right on the money - Euro rallied, Gold rallied, Oil rallied and the Fed will keep blowing bubbles till it learns a lesson it will never forget - till then keep partying.

We mentioned the XLU, SO, PCG, LLY and BIDU in our blog this past week and as part of our holdings - all of these stocks rallied hard today - staying long and going long more on BIDU or LLY..

Here are the charts:

www.trucharts.com/stockview.aspx?TICK=LLY


www.trucharts.com/stockview.aspx?TICK=BIDU


www.trucharts.com/stockview.aspx?TICK=XLU


www.trucharts.com/stockview.aspx?TICK=SO


www.trucharts.com/stockview.aspx?TICK=PCG

Good luck trading. 

Founder/CEO
Trucharts.com