One Chart, One Question
(November 8, 2014)
Now that we've conducted an unbiased overview, I can reveal the mystery stock. Just for fun, let's look at one chart and ask one question: is this stock continuing its downtrend or is it in the process of reversing? To avoid any bias, I've removed any clues to its identity.
Glancing at three common indicators, MACD, stochastic and RSI (relative strength), we note they have all turned up or are starting to turn up. We also notice that what looks like a key line of support/resistance was broken sharply to the downside, and price has reverted equally sharply back up to that line. So far, this could be interpreted as a bounce back to resistance, a move that will be followed by a resumption of the downtrend, or it could be interpreted as a classic Bear Trap, a sharp move below support that sucks in all the Bears who are anticipating a further collapse in price. Which interpretation is most likely to be correct? It's too early to say, but the possibility that price has traced out a falling wedge suggests that the Bear Trap/reversal scenario might well be in play, as falling wedges are classic reversal patterns. Now that we've conducted an unbiased overview, I can reveal the mystery stock: it's actually not a stock, it's a commodity: bat guano, a highly valued natural product. Like many of the commodities, bat guano has been in a free-fall, and the majority of financial pundits have been calling for further declines. Even bat guano Bulls have reluctantly conceded the inevitability of further large declines. Very few bat guano analysts are calling for a reversal here. The sentiment, in other words, is uniformly negative--everybody's on one side the boat in the bat guano trade. Add the overwhelmingly negative sentiment to the falling wedge/Bear-Trap spike down/recovery, and it seems the majority (Bears) might be surprised by a major reversal here. OK, the chart isn't actually bat guano. That was another way of maintaining an unbiased view. As far as I know, there is no bat guano index.
So what's this chart of? Everybody's favorite emotional trade: Gold.
Get a Job, Build a Real Career and Defy a Bewildering Economy (Kindle, $9.95)(print, $20) Are you like me? Ever since my first summer job decades ago, I've been chasing financial security. Not win-the-lottery, Bill Gates riches (although it would be nice!), but simply a feeling of financial control. I want my financial worries to if not disappear at least be manageable and comprehensible. And like most of you, the way I've moved toward my goal has always hinged not just on having a job but a career. You don't have to be a financial blogger to know that "having a job" and "having a career" do not mean the same thing today as they did when I first started swinging a hammer for a paycheck. Even the basic concept "getting a job" has changed so radically that jobs--getting and keeping them, and the perceived lack of them--is the number one financial topic among friends, family and for that matter, complete strangers. So I sat down and wrote this book: Get a Job, Build a Real Career and Defy a Bewildering Economy. It details everything I've verified about employment and the economy, and lays out an action plan to get you employed. I am proud of this book. It is the culmination of both my practical work experiences and my financial analysis, and it is a useful, practical, and clarifying read. Test drive the first section and see for yourself. Kindle, $9.95 print, $20
"I want to thank you for creating your book Get a Job, Build a Real Career and Defy a
Bewildering Economy. It is rare to find a person with a mind like yours, who can take
a holistic systems view of things without being captured by specific perspectives or
agendas. Your contribution to humanity is much appreciated."
Gordon Long and I discuss The
New Nature of Work: Jobs, Occupations & Careers (25 minutes, YouTube)
NOTE: Contributions/subscriptions are acknowledged in the order received. Your name and email remain confidential and will not be given to any other individual, company or agency.
"This guy is THE leading visionary on reality.
He routinely discusses things which no one else has talked about, yet,
turn out to be quite relevant months later."
"You shine a bright and piercing light out into an ever-darkening world."
Or send coins, stamps or quatloos via mail--please request P.O. Box address. Subscribers ($5/mo) and those who have contributed $50 or more annually (or made multiple contributions totalling $50 or more) receive weekly exclusive Musings Reports via email ($50/year is about 96 cents a week).
Each weekly Musings Report offers six features:
At readers' request, there is also a $10/month option. What subscribers are saying about the Musings (Musings samples here): The "unsubscribe" link is for when you find the usual drivel here insufferable.
Dwolla members can subscribe to the Musings Reports with a one-time
$50 payment; please email me if you use
Dwolla, as Dwolla does not provide me with your email.
The Heroes & Heroines of New Media: oftwominds.com contributors and subscribers All content, HTML coding, format design, design elements and images copyright © 2014 Charles Hugh Smith, All global rights reserved in all media, unless otherwise credited or noted. I am honored if you link to this essay, or print a copy for your own use.
Terms of Service:
|
Add oftwominds.com |