Saturday, September 19, 2009

Market Trend Continues - W/E 9/18/2009 CODE GREEN

At the end of each week I like to analyze what the market did by using several ways to evaluate the trend. There is some tracking error in each method which is why I like to use several and then compare the results of each to get a consensus. I use BarChart to get all my data.

Value Line Index - This is an arithmetic index of 1700 stocks followed by Value Line. I like an arithmetic index because it duplicates the way most individuals purchase stocks. You buy 10 or 20 stocks with equal dollar amounts of each. Professionals and mutual funds might weight by market cap but most individuals don't.

  • This week BarChart used 12 technical indicators and the VLA was a BUY in 12 of 13 indicators with only one HOLD
  • The Index was tracking above its 20, 50 and 100 Day Moving Average (DMA)

BarChart Market Momentum - This week BarChart followed 6000+ stocks and determined how many traded above their Daily Moving Average (DMA)

  • 85% above the 20 DMA
  • 87% above the 50 DMA
  • 90% above the 100 DMA

This is very positive and was above the percentages for last week and last month.

BarChart New High/ New Low ratios - I take how many stocks hit new highs vs new lows for various time periods. A number 1.0 or greater shows an upward trend.

  • 20 day H/L ratio - 1635/204 = 8.0
  • 65 day H/L ratio - 1167/50 = 23.3
  • 100 day H/L ratio - 1047/35 = 29.9

Clearly there are many more stock hitting new highs than new low so that is a very positive sign.

Summary: All my indicators are in the same direction - UP. The Stock Market appears to be having a short, mid and long term trends all in the same upward direction - I call a CODE GREEN and would continue to BUY into this market.

I'd like some feedback to find out is this analysis is helpful to you. Please feel free to make comments below or email me at

Friday, September 18, 2009

IPOs: Investments or pie in the sky

Lately, I've noticed a lot more articles about Initial Public Offerings - IPO's. This is an area of investing I really don't follow because long ago I decided the cards were stacked against me. You can only buy shares from the Sales and Underwriting group and they seemed to be talking out of two sides of their mouth. They were promising the companies that they'd get them the highest possible prices for their stock offering and at the same time telling the public that "This is the opportunity of a lifetime and you'd better get in on the ground floor!" Since I'm such a little fish in the big pond I figured they'd make me the sacrificial lamb and I'd get fleeced.

Last year at one of the Money Shows I had an opportunity to attend a session by Jon Markman and he offered some suggestions on how to make a few bucks on IPOs but I was still cautious. I don't cover them in my blog: Financial Tides because I use BarChart to follow stock and they do not analyze any stock that hasn't been trading for at least 6 months, so where would I get information on the subject?

This morning there was an article by Sara Lepro titled "As stocks keep rallying, IPOs return". She said the IPO market had tanked last year but that at the present time there were 89 new issues in the pipeline, since she said there were only 43 IPOs completed last year that got my attention.

I found the FTSE Renaissance IPO Composite Index and it's been up 35.3% YTD through August compared to only 13.0% for the S&P.

I did further research and found MSN Money Central has a whole section called IPO Center. Now I've found a source for unbiased and independent information on IPOs. I looked at some of the returns under the Performance tab and those returns looking really enticing. If small businesses can't get the money from the banks maybe I might give them a little bit of mine.

I'm considering buying a few shares that I research at the IPO Center and storing them away for a few years. How about you?

Please give me your thoughts below.

Jim Van Meerten is a full time investor and blogs on Financial Tides. He is a past winner of the MSN sponsored Strategy Lab Open and was a contributor in the 2008 Strategy Lab.

Speed up with Expedia (EXPE)

Put a little speed in your portfolio with an addition of Expedia (EXPE). It's in my S&P 500 Marketocracy fund. EXPE is a holding company that provides wholesale and retail travel services to off line retail travel agents and the public.

Some of its holdings include,, Trip Advisor and Hotwire. I've used them all and gotten fine results. It operates in the US, UK, Germany, France, Italy Netherlands and through investments in China. Pretty global!

The fundamentals of the balance sheet are solid and growing. Although it had a loss for 2008, it has healthy profits for the first 2 quarters of this year.

It has competion from Orbitz (OWW) and Priceline (PCLN). The stocks market cap is 7B to PCLN at 7B and OWW at only 519M. It wins in the revenue comparison with 2.9B compared to 2B for PCLN and only 800M for OWW.

As the economy recovers both business and personal travel should be increasing and the use of their services will soar.

Any stock needs some buzz to move and there are 15 analysts following this stock. Recent analysts recommendations have had 3 BUYS and 1 HOLD.

On the technical side BarChart rates EXPE as an 88% Buy with 10 out of 12 TA indicators a BUY and 2 a HOLD. Recent price action had 5 new highs in the last 20 trading sessions with 4 new highs in the last 5 trading sessions. Price movement has been 57% for the last 65 trading sessions.

Good numbers, analysts buzz good recent technical action.

Recommendation: BUY under 25 with a protective stop loss at 21.

Disclosure: I hold no position in EXPE at time of publication.

Recession over? Tell the bankrupt and unemployed!

I do write on some other sites. Recently an article I wrote for MSN's Money Central Money Blogs Top Stocks was read by over 57000 readers with almost 500 comment in the first 24 hours.
I'm providing the link for my readers: Recession over? Tell the bankrupt and unemployed

Thursday, September 17, 2009

As Drug use Increase so Should Bioscrip's Margins

Today all you read about is Health Care. One of the ways to control Health Care costs is to use drugs instead of surgery and hospitalization. The new Health Care Plan will have a very large drug benefit in it no mater what form it takes. According to BarChart one of the drug companies continuing to hit new highs is Bioscrip (BIOS).

BIOS's product is comprehensive pharmaceutical care solution through the use of specialty medication distribution systems and clinical management services. They fall in the Retail Drug Store sector and have major competition from Rite Aid, Herbalife, Walgreens and CVS.

Although they are the smallest of the group with only 1.4 billion in revenue analyst are starting to notice them. Arnold Mark of Piper Jaffray recently put out an Overweight recommendation on BIOS. Why?

Although the have had increasing revenue for the last 3 years, last year they had some non-reoccurring expenses that gave them a loss. This year they have been increasing profits every quarter and project a profit by year end. Their gross profit margins have always been positive. Good numbers on a fundamental basis, but how about the technical analysis numbers?

BarChart uses 13 TA indicators and they rate this stock a BUY on 13 out of 13. The price has hit 5 new highs in the last 20 trading sessions with 3 in the last 5 days. Its 65 day price return has been 47%.

My recommendation: The new Health Plan will have a major drug component so BUY BIOS at the 6.50 range and put a protective stop loss at 5.50

Wednesday, September 16, 2009

Recession Over? Ask the Unemployed!

I'm having a hard time with the Fed's talking head saying the recession is over and the economy is in recovery. What charts are they using?

We are a consumer society and our real measure of the economy is what the consumer buys; whether it's for cash or on credit. There seems to be a short supply of both.

Unemployment is rising and about to cross 10%. If 10 % of our consumers have no job and the other 90% isn't sure how long they'll have one either who will be spending money?

Credit card balances are rising at the same time lenders are cutting back credit limits, there will be a crunch soon.

I'm seeing too many for rent signs in store windows that used to be occupied and too many for sale signs on residences with unmowed lawns.

My best indicator for the recession being reversed will be after the unemployment rate peaks above 10% and it comes back down below 10%. When people are back to work and unemployment is down to 5% then I'll wave "The Recession is Over!" banner; not before.

Give me your comments below or email me at

International Printing (IP) May Start Printing Money

International Printing (IP) is one of the leading companies in the paper products industry. Its name says it all. They produce printing and writing paper as well as pulp, tissue, paperboard and packaging material. They even produce chemicals that others in the industry use. Their markets are truly international and they serve the US, Europe amd the PAC rim.

Their main competitors are Weyerheauser (WY) and MeadWestvaco (MWV). Their Market Cap is 10.8B to WY's 8.3B and MWV's 3.9. Revenues are similarly comparable with 25.8B compared to WY's 6.5 and MWV at 6.2.

As the world economy comes back online the demand for packaging and paper product should soar and IP will start printing money.

The stock is part of my Marketocracy S&P 500 holdings.

On a short term technical basis BarChart is high on this stock. In the last 20 trading sessions IP has high 13 new highs and given a 104% return over the last 65 trading sessions. Of BarChart's 13 technical indicators IP is 13 for 13 BUY!!!

Recommendation: BUY at this level of around 25 with a protective stop loss at the 50 Day Moving Average of 20. Move you stop loss up weekly to protect your profits.

Disclosure: I hold no positions in IP at the time of publication

Tuesday, September 15, 2009

CNBC Blah! Blah! Blah!

Is it just me or does CNBC give you a headache too??? I thought when I became a full time investor I'd enjoy watching TV while I researched investments on BarChart and blogged but CNBC is ridiculous! I have to turn it off to concentrate.

The guest just yell at each other, cut off others before they can express their views and are so rude that half the time I get nothing out of the discussion - and I use the term "discussion" loosely! More like a brouhaha!

Larry Kudlow is the worst among them. He wouldn't have lasted 10 minutes in Mrs. Tyson's 7th grade English class. I could hear her now: "Larry Kudlow, you didn't raise your hand. You shut your mouth and don't interrupt others. One more word out of your mouth and I'll rap your knuckles with a ruler and put you in the corner. Just keep it up young man and you'll be down in Dean Beal's office and your fannie will feel the rath of his paddle. Now do you understand me? Your rudeness reflects on your parents and your poor upbringing!"

Larry Kudlow does not know the meaning of civil discourse. He must have never taken a debating class or he'd know there are rules to follow.

Today on Street Signs, Erin Burnett totally lost control of two professors or think tank guru's. I got nothing out of their rude and obnoxious yelling. I went to look at the replay video but even the directors of the program thought the clip had no value and didn't post it.

Fast Money in no better. BLAH! BLAH! BLAH!

What about Mad Money and Jim Cramer??? I never thought I'd say this but Jim Cramer is the most civilized person on CNBC. He may yell and scream but never at a guest. He asks questions, lets the guest fully answer, listens and then asks meaningful follow-up questions?

You can join my protest and put CNBC on MUTE. Sit down and read my blogs, or your favorite blogs of others. Read a good book on investing and learn something, uninterrupted.

Read the blogs, try to understand the authors points, if you disagree, type off a well thought out and polite comment and save your sanity.

Bloggers unite in civil discourse.

Please give me your comments below or pen off a reply to me at

Monday, September 14, 2009

Search in a New Language - Chinese - Baidu - BIDU

Baidu (BIDU) is the leading Chinese language Internet search engine. It has been in my Jim Van Meerten/BarChart New High model portfolio on Marketocracy for some time. I add stocks to my New High Fund when I see stocks trading over 100K per day that continue to hit new highs.

BIDU's main competition in the Chinese market is SINA and SOHU. BIDU has 545M in revenue while SOHU has 485M and SINA 372M. Why do I like BIDU above the others?

As I've shared before, I use BarChart to find stocks having upward price momentum and good underlying fundamentals. BarChart's 13 technical indicators all have BIDU as a BUY for a 100% Buy rating. The stock continues to hit new highs and has hit 10 new highs in the last 20 trading sessions.

Recommendation: BIDU is trading around 375, a high price. Many think it may fall so use caution and put a stop loss around the 50 day moving average of around 330. This is not a stock to buy and hold but might be a good one for a closely monitored trading portfolio.

Give my your opinion at

Disclosure: I have no actual position is BIDU at time of publication

Genworth Financial - GNW - Comeback Story

Genworth Financial (GNW) has been in my Jim Van Meerten/BarChart S&P 500 fund on Marketocracy for a few weeks and has been a great performer lately. GNW is a comeback story. Lately some of the rating agencies have given them a bad rap, but we know the poor record the rating agencies have had recently.
GNW is in the "Lifestyle Protection" business. That's the new fancy name for insurance that protects income: Life Annuities, Disability, Long Term Care and Life Insurance. It has some major competition in Allianz, ING, AIG & AXA. The whole industry is poised to make a comeback because of a flight from securities to safety and as the investment climate brightens so should GNW's bottom-line.
Why am I so high on GNW when the rating agies aren't:
  • GNW recently was awarded a BIG contract with the Teacher's Retirement Fund of Texas - one of the largest retirement funds in the US to provide Long Term care for its members.
  • BarChart has it rated as a 96% BUY with 12 of its 13 technical indicators a BUY and only one hold.
  • The stock has hit 10 new highs in the last 20 trading sessions for a monthly gain of 46%

Recommendation: BUY - presently trading at around 11 and I'd place a protective stop at its 50 Day Moving Average @ 8. Move the stop up as the stock rises but sell if it trades below its 50 DMA.

Genworth's Site