Screen Shot 2014-05-05 at 9.13.38 PMTim Reazor
Chief Investment Strategist
NorAm Asset Management

On Saturday’s “Your Money” radio program during the hold them or fold them segment I said to fold bonds and oil for the week.  By fold as I explained on the air I meant harvest profits and wait for the next setup for these trades.  Well it appears oil may be setting up and bonds continue to break down.  Nothing shows this better than a picture so let’s take a look at crude oil futures and 30-year Treasury bond futures on a daily chat.  Bonds are the first chart you see and crude will be second chart.

IDB 6 4 14 Leading Off.Time to get back into Oil

IDB 6 4 14 Leading Off.Time to get back into Oil_001On my charts my moving averages are the 8-day exponential moving average in green, the 21-day exponential in pink and the 34-day exponential in yellow.  As you can see in on the first chart, that is the bonds chart, price has broken all the way through the 34 and fighting to climb back.  This isn’t constructive and this is the price action I expected to see as the fledgling uptrend starts to find its legs.  There isn’t a solid entry point and buying shares in TLT, the bond ETF, or calls with a Delta of 70 may leave you worse for wear.

Now take a look at the second chart; it’s the chart of crude oil futures.  This now looks more constructive.  Why?  We’ve come all the way down to the “34” found support and now we’ve closed above the 21-day.   What I want to see is a second close above the 21-day and then I’ll start to build a position using USO. USO is the crude oil ETF.   You don’t want to buy big… you want to start small – maybe a few shares or a few Delta 70 calls with a least a 45-60 day timeframe.   If price continues to climb and the 8-day becomes support I’ll continue to build my position.  I’ll stop building if crude becomes extended off the 8-day.   On the journey higher I want to see price clear the $104 levels and then start to harvest profits around the $105 price level.  Maybe I’ll leave 1/3 of the position at the $105 level depending on how prices action in the case there is a move even higher.  This roughly translates into a $39 into $40 dollar move in USO.

What’s the exit plan?  If we lose support at the 21-day and move to the “34” I’m out.  When we’re at the 34-day the door that is open the widest is the door to lower prices.  It’s always best to take a small loss and look to re-enter vice clinging to hope of a move higher that may never come.

 To see my watch-list and game plan for this week watch this video – http://vimeo.com/96957792

 To hear my expanded thoughts on the markets, how to be positioned and the psychology of this market listen to the radio show I’m lucky enough to co-host with Danny Stewart – http://www.thewallstreetshuffle.com/category/podcasts/

You can listen to the show live on Saturday’s at 10:00 AM – just click this link and bookmark it – http://www.iheart.com/live/1190AM-4276/?autoplay=true

You can also listen via the iHeart Radio app.  Simply download the app to your smartphone and search for 1190 AM Dallas.  There is even an alarm you can set to remind you of when our show is on.

If you want to come into my office and learn about credit spreads send me an email.  It would be a pleasure to meet, bond and talk stocks together – tim.reazor@NorAmAsset.com

I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor

I hope today’s newsletter helped.

Best Regards,

Tim

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.

Screen Shot 2014-05-05 at 9.13.38 PMTim Reazor
Chief Investment Strategist
NorAm Asset Management

This is a make or break week for the fledging uptrend.  China PMI is out and the number most likely will sustain the uptrend until Thursday.  The ECB speaks about rates in Europe. This will affect all markets.  Remember, what counts in this game is how the market interprets the information… not what you think.  Even if the uptrend “survives” what the ECB throws at it Friday looms large.

 Friday brings us the non-farm payroll numbers.  This is big.  Why?  Contracting GPD along with a bad employment report could give bears the fuel they need to crush the trend higher.

 How should you prepare?

Execute your plan.  If you plan is to nibble on a few high quality stocks do so.  Have tight stops and use small size to protect yourself for major portfolio damage.  You can always scale in after with more size later.

 For credit spread traders… there will be so much pent up volatility this week that I think you can wait until Friday morning after the market opens to place your trades.  If you do wait until Friday morning let the market open up and shake out the emotion.  The true intentions of the market should be know by 10:30 central time.  In regards to spreads; this is a marathon not a sprint.  If you sit this week out it’s ok… your goal every week to make the most amount of money while assuming the least amount of risk.  If you’re not comfortable skip the week.  Now, one more word on this topic… I’m betting that you’ll find great premium 2 standard deviations out on Wednesday afternoon.  So, if you’re experienced you should be able to find some great opportunities.

 Here are two resources to help you successfully navigate the market.

To see my watch-list and game plan for this week watch this video – http://vimeo.com/96957792

To hear my expanded thoughts on the markets, how to be positioned and the psychology of this market listen to the radio show I’m lucky enough to co-host with Danny Stewart – http://www.thewallstreetshuffle.com/category/podcasts/

You can listen to the show live on Saturday’s at 10:00 AM – just click this link and bookmark it – http://www.iheart.com/live/1190AM-4276/?autoplay=true

You can also listen via the iHeart Radio app.  Simply download the app to your smartphone and search for 1190 AM Dallas.  There is even an alarm you can set to remind you of when our show is on.

If you want to come into my office and learn about credit spreads send me an email.  It would be a pleasure to meet, bond and talk stocks together – tim.reazor@NorAmAsset.com

I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor

I hope today’s newsletter helped.

Best Regards,

Tim

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.

Screen Shot 2014-05-05 at 9.13.38 PMTim Reazor
Chief Investment Strategist
NorAm Asset Management

Your brain tells you that the market should not be going up.  Your heart tells you that our GDP was really bad so you should short this market.   Your eyes tell you from looking at the charts that you’re missing / going to miss the move higher or worse that you’re positioned on the wrong side of the trade.  With all of this confusion what should you do?

 Wade back in… with a lifejacket.

 Develop a watch-list and start to take small positions in one or two potential leaders.  Several of the stocks mentioned on the radio and in my videos are already on the march.  Sanchez Energy (SN) is already extended, but there are many more setups out there.  Enable (ENBL) is still in an IPO base if you care to take a look.

 You need to put yourself in a position to succeed.  Do the following to help yourself find success in the markets.

• Identify a potential leader, not junk, not low-priced or something you think is undervalued.  Look for genuine leaders.

• Know your stock’s proper buy-point.  Don’t chase stocks that are extended.  There are many reasons to not chase to list here.  I’ll cover the reasons on this Saturday’s radio show and video.

• Set your stop at no more than 5% below the proper buy point.   You need tight stops in the markets.  Gains are hard to come by.  If you have two stocks and one is a 20% gainer and the other a 20% loss you’re at breakeven.  If one stock gains 20% and the other is a 5% loss you’re still 15% ahead of the game.  I know this seems simple and easy, but how many of us have forgotten about this during the heat of battle?

• Set profit targets at 15%-20%.  If you’re afraid of missing a huge move then sell all but a 1/3 of your position when you hit a price target.  This way you’ll still participate, but you’ve harvested profits while limiting risk.

To see my watch-list and game plan for this week watch this video http://vimeo.com/96256833

You can listen to the radio show, Your Money, live on Saturday’s at 10:00 AM – just click this link and bookmark it – http://www.iheart.com/live/1190AM-4276/?autoplay=true

You can also listen via the iHeart Radio app.  Simply download the app to your smartphone and search for 1190 AM Dallas.  There is even an alarm you can set to remind you of when our show is on.

If you want to come into my office and learn about credit spreads send me an email.  It would be a pleasure to meet, bond and talk stocks together – tim.reazor@NorAmAsset.com

I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor

I hope today’s newsletter helped.

Best Regards,

Tim

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.

Screen Shot 2014-05-05 at 9.13.38 PMTim Reazor
Chief Investment Strategist
NorAm Asset Management

If you’re in the TLT trade I’ve discussed in this newsletter and on the radio with Danny Stewart be prepared to take some profits.  We’re approaching the $115.34 price extension I’ve been targeting.  This trade has worked best by harvesting profits at extensions and re-entering at support.  A quick note about size; when you buy only buy a ½ position.  Why?  There is no guarantee that TLT will hold support levels.  If stocks run higher, bonds will most likely go lower.  Using a tight stop and smaller size limits your losses; which is crucial for this unforgiving market.

 What’s Next for Bonds?

 I’m writing this on Wednesday evening.  By the time you read this the GDP number will have been released.  Bond prices and yields will be affected by the number.  If the market interprets the information as “good” then stocks should rally and bonds most likely will fall.  If the market interprets the GDP number as “bad” then bonds should rally and stocks should fall.

Before you do anything tomorrow morning let the markets settle out.  There will be several head fakes before the markets true move is known.  It’s always best to harvest profits aggressively and keep loses small.

To see my watch-list and game plan for this week watch this video http://vimeo.com/96256833

You can listen to the show, Your Money, live on Saturday’s at 10:00 AM – just click this link and bookmark it – http://www.iheart.com/live/1190AM-4276/?autoplay=true

You can also listen via the iHeart Radio app.  Simply download the app to your smartphone and search for 1190 AM Dallas.  There is even an alarm you can set to remind you of when our show is on.

If you want to come into my office and learn about credit spreads send me an email.  It would be a pleasure to meet, bond and talk stocks together – tim.reazor@NorAmAsset.com

I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor

I hope today’s newsletter helped.

Best Regards,

Tim

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.

Screen Shot 2014-05-05 at 9.13.38 PMTim Reazor
Chief Investment Strategist
NorAm Asset Management

The gold trade I’ve been discussing with you for quite some time is broken.  Gold lost the $1288 price level falling 2+% today and is now clinging to $1661 support.   You may be asking why don’t we hold on to shares of GLD or the delta 70 calls that may have 40+ days left to expiry.  We could wait for a bounce and then sell, but ask yourself this simple question.  Which door is open most at the moment in gold?  Is the door to higher prices open or lower prices open the widest. Lower prices win the day for the moment.

What’s Next?

This $1261 price level is key.  If $1261 can’t hold then $1250, $1235 and $1218 are in the cards.  Will we get a bounce?  We’ll most likely bounce at some point, but when is the huge question.  I’ve found that my first opportunity to sell and take a small loss is usually my best opportunity.  Remember, we can always revisit this idea when prices firm up.

To see my watch-list and game plan for this week watch this video http://vimeo.com/96256833

You can listen to the show live, Your Money, on Saturday’s at 10:00 AM – just click this link and bookmark it – http://www.iheart.com/live/1190AM-4276/?autoplay=true

You can also listen via the iHeart Radio app.  Simply download the app to your smartphone and search for 1190 AM Dallas.  There is even an alarm you can set to remind you of when our show is on.

If you want to come into my office and learn about credit spreads send me an email.  It would be a pleasure to meet, bond and talk stocks together – tim.reazor@NorAmAsset.com

I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor

I hope today’s newsletter helped.

Best Regards,

Tim

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.

Screen Shot 2014-05-05 at 9.13.38 PMTim Reazor
Chief Investment Strategist
NorAm Asset Management

This week I’m nimble.  The market as you’re well aware is at an inflection point.  It has been for some time.  I have a watch-list that I’m ready to nibble on should this move higher prove true.  I’d like to see more volume, which equals conviction come into this upside move.  The reason why is simple.  If there is institutional conviction a move higher can sustain a few blows that the market is sure to deliver.  If there isn’t participation from the institutions then any blows that the market delivers won’t be repelled so easily.  In fact the markets can tumble lower more easily without the institutions participation and that’s why I remain cautious in regards to this recent move higher.

I do respect price and the fact that the markets may already be coming out of the starting blocks for the next move higher.  This is why I have a watch-list and a game plan.

To see my watch-list and game plan watch this video http://vimeo.com/96256833

I also discussed this very topic on the radio show I host along with Danny Stewart.  To listen to this week’s show click this link – http://www.thewallstreetshuffle.com/category/podcasts/

You can listen to the show live on Saturday’s at 10:00 AM – just click this link and bookmark it – http://www.iheart.com/live/1190AM-4276/?autoplay=true

You can also listen via the iHeart Radio app.  Simply download the app to your smartphone and search for 1190 AM Dallas.  There is even an alarm you can set to remind you of when our show is on.

If you want to come into my office and learn about credit spreads send me an email.  It would be a pleasure to meet, bond and talk stocks together – tim.reazor@NorAmAsset.com

I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor

I hope today’s newsletter helped.

Best Regards,

Tim

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.

Screen Shot 2014-05-05 at 9.13.38 PMTim Reazor
Chief Investment Strategist
NorAm Asset Management

Are you feeling like the stock market world is moving up without you? All the names you know and love are moving higher – Apple, Netflix, Tesla – and you’re not in them!  How can stocks move up without you?! What are we going to do about this?

 Form a watch-list.  Why?  The NASDAQ has just crossed about the 50-day simple moving average.  That’s a big deal!  Did it make this accomplishment on low volume?  Yes! That’s why I’m not head over heels in love with this market.  There’s also another reason not to love this market for the time being.  Bonds are still near their highs.  As a matter of fact bonds are at ten-week support.  If this were a bull-phase in the market cycle bonds would have broken support today.  Maybe bonds will break support on Friday or next week.  Once bonds break decidedly lower equities should then move up with volume and then you’ll know it’s time to be back in stocks.

 On this upcoming Saturday’s radio show and video (May 24th) I’ll be talking about proper position sizing, my stock watch list and how to trade USO and TLT.   I’ll also teach you credit spread techniques.

 You can listen to the show live on Saturday’s at 10:00 AM – just click this link and bookmark it – http://www.iheart.com/live/1190AM-4276/?autoplay=true

 You can also listen via the iHeart Radio app.  Simply download the app to your smartphone and search for 1190 AM Dallas.  There is even an alarm you can set to remind you of when our show is on.

If you want to come into my office and learn about credit spreads send me an email.  It would be a pleasure to meet, bond and talk stocks together – tim.reazor@NorAmAsset.com

I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor

I hope today’s newsletter helped.

Best Regards,

Tim

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.

Screen Shot 2014-05-05 at 9.13.38 PMTim Reazor
Chief Investment Strategist
NorAm Asset Management

This is a theme I’ve been coming back to for sometime this month.  I only want to be long commodities like crude oil and the stocks associated with crude.

It’s hard to make money in a market that that changes its mind from day to day.  It’s easier to make money in a market that is trending – as long you know the trend.

Right now crude oil and a handful of oil stocks are trending higher.

The easiest was to take advantage of this trend is to buy the crude oil ETF USO.  You could also look at stocks like Continental Resources (CLR) Diamondback Energy (FANG) Schlumberger (SLB) and Anadarko Petrol Corp (APC)

Here in the shop we have gains of 12%, 3% and 4% in CLR, SLB and FANG respectively.  We are currently not in APC.

On this upcoming Saturday’s radio show and video (May 24th) I’ll be talking about proper position sizing for the above stocks and ETFs as well as how to take profits and when to scale back in.

You can listen to the show live on Saturday’s at 10:00 AM – just click this link and bookmark it – http://www.iheart.com/live/1190AM-4276/?autoplay=true

You can also listen via the iHeart Radio app.  Simply download the app to your smartphone and search for 1190 AM Dallas.  There is even an alarm you can set to remind you of when our show is on.

If you want to come into my office and learn about credit spreads send me an email.  It would be a pleasure to meet, bond and talk stocks together – tim.reazor@NorAmAsset.com

 I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor

 I hope today’s newsletter helped.

Best Regards,

Tim

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.

Screen Shot 2014-05-05 at 9.13.38 PMTim Reazor Chief Investment Strategist NorAm Asset Management

For the record I’m still waiting for the market to fall apartJ. While I wait I want to come back to s central theme for me this spring. Selling credit spreads and being in commodities like oil and gold.

Why?  The manner in which we set up our credit spreads is forgiving.   We set up our spreads based on the standard distribution curve.  This is perfect for this type of market environment.  Why?  I can take in credit (income) and still achieve maximum profit if I’m wrong on the direction of the stock.  And in this choppy environment that’s exactly what investors need – a forgiving trade that typically produces positive results.

I also like crude oil here.  Crude has one of the most bullish patterns I’ve seen in awhile.  The easiest way to participate in this potential move higher is to use the crude ETF USO.  If crude clears resistance at $37.84 I’m looking for the move to extend up into the low $40s.    That’s not a guarantee, it’s just what I’m currently seeing on the charts.

US Oil USO 1 Yr - 5 20 2014

If you want to come into my office and learn about credit spreads send me an email.  It would be a pleasure to meet, bond and talk stocks together – tim.reazor@NorAmAsset.com

I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor

I hope today’s newsletter helped.

Best Regards,

Tim

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.

Screen Shot 2014-05-05 at 9.13.38 PMTim Reazor
Chief Investment Strategist
NorAm Asset Management

While I’m waiting for the market to fall apart J I want you show you two charts.  The first chart is for Apple (AAPL) and the second chart is for Netflix.  Apple has been bullish since earnings were released.  Apple is hitting a 52-week high and has look of a stock that wants to run.  It’s a leader.

Now look at Netflix (NFLX).  This stock has been a laggard. So what has changed? Netflix bounced off the 200-day simple moving average and reclaimed the 50-day SMA during Monday’s session.  That’s a big deal.  The question is what should you do?  Add these two names to your watch-list and stalk them.

Buying at this juncture in the market’s cycle is risky.  Why?  The Nasdaq is the lagging index.  If market is going to trend higher, then the Nasdaq will have to do what Netflix did on Monday – retake the 50-day SMA.  If the Nasdaq is going to do this both Apple and Netflix are going to play a critical role.  Until the Nasdaq gives you the green light stay nimble.  You can invest in both names once an uptrend begins.

Neflix NFLX 2 Yr - 5 19 2014 Apple AAPL 2 Yr - 5 20 2014

In this current environment I’m partial to generating income using credit spreads vice being directional.  That will change when the Nasdaq changes re-takes the 50-day SMA.

If you want to come into my office and trade with me send me an email.  It would be a pleasure to meet, bond and commiserate together – tim.reazor@NorAmAsset.com

I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor

I hope today’s newsletter helped.

Best Regards,

Tim

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.