Achilles... I actually spent some time looking at a BABA short for next year based on tariffs etc. They only derive 10% of their revenue from the U.S. so I don't know. Its a tough one for me to understand. I suspect T/A will work well on this one from now until their next ER. Without strong a T/A, I'm scared to take it long or short. My limited T/A skills says it looks like a good short, but I would like to hear from CM or Eganon first.
Well, it might help you. BABA was a good short, but a long time ago. BABA built a double bottom in Sep '15 and Feb '16. Since then, BABA began to rebound. In this graph, you can observe correction during last 2 months was exaggerated compared to the price. Indeed, weekly RSI made a new low compared to June. Or, at the same time, we are @87 dollars, which is far above the former low @74 dollars. Price action tells you sellers don't hold the nuts. If buyers come back, stock would easily go to $100 then $120. At last but not at least : 85 dollars is the neckline of the double bottom (green line). Former resistance should become support. So 85 dollars is the natural support. To conclude : Buy if 85 dollars holds. CM
Achilles... I was reading all the "expert" opinions on different blog sites last night. I'll see if I can find which one it was.... but whichever one it was, it was legit. I'll dig around. One point the article did make too that I didn't post, was that if there is a trade war, aside from U.S. sales, it would hurt the average Chinese consumer, which would in essence hurt BABA. The guy had a bias to the short side, it caught my eye because I thought their U.S. sales were greater than that. They did more on "singles day" than AMZN did on Black Friday and Cyber Monday combined. Read up on TMall too.
this thread is an example of how one should be created. it starts with a goal and a lot of information posted by the OP. kudos to the author
Oil. Trump promised two sweeping changes to the global supply picture. 1. Trump promised and campaigned aggressivily on a complete deregulation of Americas domestic oil, gas and fracking industry. Including opening up the Alaskan north slope to "great American oil companies". The plays here are obvious - long us domestic drillers, frackers, wild catters and small to mid caps. Huge American vertically integrated Petro companies should make out like a bandit. Exxonmobile is an obvious play now that Rex tillerson is sec state elect. Connco Phillips. Chevron. Etc. Short us natural gas, and electricity futures. Part of the trump energy agenda is to reverse UN agenda 21 crap which imposes severe carbon taxes and regs on refineries and power plants. This has all been done by design to double and triple American energy costs relative to china, India and Mexico, thereby further chasing manufacturing overseas. Trump plans more domestic refining capacity and power plants. So gasoline, diesel and electricity prices should be coming down across the board. The bulk of the deregulation can come quick through both executive orders and gutting existing regulation. Which he also made aggressive promises on. 2. Isis is to be wiped from the face of the earth and daesh oil fields are to be conquered by American military forces for indefinite occupation. The proceeds from the Isis wells are to be used to finance the war effort and take care of veterans. Trump was emphatic about this his entire campaign. This was not a once or twice off the cuff casual semi vague remark. We're going in, we're wiping Isis out, we're taking the oil indefinitely. And who knows what's next. Now, what to do ? Point 1 says much lower prices. Point 2 says much higher. This is how I'm going to play it. Dereg happens first. I'm going to wait and see what trump does and how market reacts. If trump slashes energy regs big time and oil holds a bottom for a month or two, I'm going Long in a big way in anticipation of point 2. If after trump deregs oil sells off good, then I wait until I hear the war drums for Isis then reevaluate. Thoughts and opinions ?
Achilles, Lots of good ideas. My thought is that most of the market's initial moves are correct but there are likely to be discouragement points along the way, creating dips and buying points. The basic play is the obvious one - Buy the domestic "real stuff" economy. -I agree on refineries. I think CVI (Icahn's refiner) has run up excessively vs other refiners due to the connection, At this point I would consider some of the others. I think the action in CVI, however, has been very educational. It reminds me of the old days being able to make money off of CNBC mentions for large gains. Very frothy which suggests exited retail participation - total change in the environment that I think could continue and perhaps become more extreme between lull periods. -The new commerce secretary is a big steel guy, Trump has pounded the steel economy as a major theme, and tariffs were put in place early last year. Once again prices have jumped a great deal, but off of a low level. A long term chart shows the way these things can run during a real economic cycle that favors them. -Energy exports - I am still looking at this, but one obvious way to keep prices up and support the full energy economy (including coal vs. natural gas) is to massively expedite LNG and other energy exports. From a Trump perspective, it also has the benefit of helping to balance trade. Some interesting companies in this area. -Banking - I can't say I know what will happen with the yield curve, but so long as it is positive sloping with a reasonable spread I believe the coming deregulation will be a massive profit booster - the industry has been hamstrung by regulation. -The increased lending will also create a boom in "working man's" consumer spending as well as productive investment in "real goods". -Tax reform - Much of it has been discounted, but a serious reduction in corporate tax will massively help the more profitable domestic companies - mostly small/mid/micro cap as has been mentioned. The popular mind says that all companies have loopholes and don't pay the top rate - this is not true, I am a small cap portfolio manager/researcher and I can say many pay the top corporate rate and will get a large EPS boost if tax reform i substantial. -Construction aggregates - It is in part on infrastructure play, but also just a play on the "real stuff" economy. -Defense spending - Trump's bulling of the large contractors on cost might seem concerning, yet if he truly wants to expand the navy, and rebuild our military (I think he does) it will be good for the defense economy. The "bulling element" might provide dips to buy - and also might suggest looking at contractors who are a bit below the radar. -My long shot is Twitter - On one hand it is a confused, poorly run economy with a highly overvalued stock. On the other hand events on Twitter (Trump, now Russian embassy, etc) have been driving the news cycle for months - I don't see why increasing numbers of "news worthy" people will not follow trumps lead and make Twitter a primary "direct communication" tool, increasing its value for a takeover/acquisition by a company that can properly monetize it.