June 30, 2014
Market Strategies Newsletter
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How To Invest 10000
Covering High Return Balanced Stock Market
Investing Strategies To Make Money In Up Or Down Markets
Over 284% Gains In 2013
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In 2013 YTD gains were $28,479
Over 284% Returns
A $10,000 Portfolio would be worth $38,479
The last 3 years our gains have gotten progressively greater year over year.
284% Returns for $28,400 Profits In 2013
171% Returns for $17,100 Profits In 2012
77% Returns for $7,700 Profits In 2011 (only 33 weeks)
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What Should I Invest In
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Market Strategies
$10,000 Trading Account
Traders Comments
There are three open positions:
BA July 130 Calls; CLDX July 16 Calls; KIRK July 20 Calls
Funds in Use $ 1,562
Gain for the week $ 1,018
YTD Gain $ 1,457
We are entering week 26, so the first half is officially over.
We made $1,018 and brought YTD gains to $1,457 with $1,562 funds in use.
The market continues to grind higher and the S&P500 closed less than $2 off the new high close of 1,962.87 from just last Friday. This run from mid-May has been an example of a market that continues to “self-correct.” Every decline has been met with new buying. The biggest setback occurred between 6/9 and 6/12, and even that was only from the new high of 1,955 and 1,925…and in less than a week was making yet another higher close of 1,956.98.
As I went through the charts this weekend there were no shortages of great looking longs.
Statistically, the week coming up to July 4th is an up week. The problem is that this year it is only really a three day week. Volume has already shrunken to 1999 levels and to me that means risk increases with decreased liquidity.
As I have discussed before, every market has its own “personality.” This would be a particular setup that occurs on a regular basis. The head and shoulders formation that fails and turns into a new up leg has been repeated over and over again. Another area that has been and continues to work is the “gap-fill” trade. Just take a look at any of the gaps down on bad news (earnings, failed new product launches, etc.) and watch for the new trading range and wait for the break….BBRY had okay earnings but bad guidance at the $9.50 level and had a 3 week decline to $7.25. After almost three months of consolidation it broke out over $8 and has had a 4 day move to over $10.
VMW broke from $107 to $90 and has spent 3 months between $90 and $98..a break over $99.15 could yield $105-107 pretty quickly.
DKS came down from $53 to $43 overnight and has spent the last 30 days consolidating.
It made a nominal new high on Friday @ $46.19. A continuation from here goes to the $50 area.
A couple more are WFM, FNSR, BLOX, and POWR.
Market Strategies $10,000 Trading Account
Trade Table
| DATE | TRADES | PRICE | COST | PROCEEDS | RESULTS |
| 06/26 | Bought 8 BA July 130 Calls | 1.28 | 1024 | ||
| 06/26 | Sold 4 FCX July 35 Calls | 1.08 | 432 | 164 GAIN | |
| 06/25 | Sold 2 TLT July 110 Calls( 100% Profit Rule )Sold 2 TLT July 110 Calls later same day | 3.062.93 | 612586 | 306 GAIN280 GAIN | |
| 06/24 | Sold 4 FCX July 35 Calls( 100% Profit Rule ) | 1.34 | 536 | 268 GAIN | |
| 06/23 | Bought 4 TLT July 110 Calls | 1.53 | 612 | ||
| 06/19 | Bought 4 CLDX July 16 Calls | 1.50 | 600 | ||
| 06/09 | Bought 8 FCX July 35 Calls | 0.67 | 536 | ||
| 06/06 | Bought 10 KIRK July 20 Calls | 0.45 | 450 |
Remember, these trades are based on your participation in the
TEXTING SERVICE TO RECEIVE ALL UPDATES.
Previous closed out trades not listed here may be seen in previous market letters in the
We may trade weekly options and they are noted: SPY 1/25 147 for SPY Jan 25th 147 calls or puts.
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Investing Strategies
Market Laboratory – Weekly Changes
Prices are copied from Barron’s Weekly and Yahoo Finance and may be incorrect
| Dow16,851.84 -95.24-0.56% |
Nasdaq4397.93+29.89 +0.68% |
S&P 5001960.96-1.91-0.10% |
Transportation 8175.52 -29.59 -0.36% |
Russell 20001189.50 +1.07+0.09% |
Nasdaq 1003844.44+41.80+1.10% |
| Gold (spot)1319.00+2.80+0.2% | Silver (July)2107.7+12.8+0.6% | Crude105.74-1.52-1.4% |
Heating Oil 300.35-5.50 -1.8% |
Unleaded Gas3.0742-0.0220-0.7% | Natural Gas4.409-0.143-3.1% |
| VIX11.26+0.41+3.9% | Put/Call RatiosS&P 100166/100’s+39/100’s | Put/Call RatiosCBOE Equity53/100’s+6/100’s |
Bonds 136-.29 +1-18 3.35% -0.08% |
10 Yr. Note125-03 +2662.53% -0.08% | Copper316.80+5.50+1.8% |
| CRB InflationIndex310.82-2.11-0.7% | B9arron’s Confidence70.4%-1.0% | S&P100866.54+0.39+0.05% |
5 Yr. Note 119-124+157 1.62% -0.07 |
Dollar80.02-0.21-0.04% | DJ Utilities571.71+5.25+0.93% |
| AAIIConfidenceIndex | Bullish37.2%+2.0% | Bearish21.1%-3.0% |
Neutral 41.7% +1.0% |
M1 Money Supply+13.51%June 16th | M-2 MoneySupply+6.82%June 16th |
M1…all money in hands of the public, Time Deposits Traveler’s Checks, Demand Deposits
M2.. adds Savings and Money Market Accounts both compared with the previous year.
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Good Stocks To Invest In
New Stock Recommendations $100,000 Portfolio
1) Buy 2000 MVIS @ $ 2.05 O.B.
2) Buy 2000 AMSC @ $ 1.50 O.B.
Each stock is allocated a theoretical $ 5,000 share of the portfolio unless otherwise indicated.
| Stock | Purchase Price | Purchase Date | Stop/Loss | Price/Date Sold | Profit/(Loss) | ||
| HERO 500 | 4.44 | 06/20 | 4.12 stop | 4.21 6/23 | ( $ 115 ) | ||
| RNN 2500 | 0.90 | 06/10 | 0.87 | ( $ 75 ) | |||
| FXC 150 | 34.25 | 06/10 | |||||
| INO 500 | 8.92 | 05/30 | 06/10 200 @ 12.02 06/19 300 @ 9.13 |
$ 620 $ 63 |
|||
| AGQ 100 | 58.60 | 05/28 | 06/19 70.01 | $ 1,141 | |||
| SPXU 100 | 53.05 | 05/22 | |||||
| NBG 300 | 2.95 | 05/19 | |||||
| BOOM 300 | 19.90 | 05/16 | 6/26 22.09 | $ 657 | |||
| GLXZ 5000 | 0.46 | 05/12 | |||||
| XRGYF 5000* | 0.407 | 03/14 | |||||
| OSIR 300 | 15.94 | 02/13 | |||||
| INSM 300 | 15.37 | 01/29 | 06/18 16.98 | $ 483 | |||
| GRPN 500 | 10.40 | 01/28 | |||||
| RPTP 400 | 15.37 | 01/16 | |||||
| AA 300Sold 200 | 10.06 | 01/10 | 6/26 14.87 | $ 854 | |||
| WLT 300 | 16.22 | 12/23 | |||||
| GSG 150 | 32.64 | 12/23 | 32.21 sco | ||||
| NBG 300 | 4.08 | 8/12 | |||||
| TEXQY* 200 | 6.56 | 7/11 | |||||
| NBG 300 | 12.10 | 5/23 | |||||
| HL 1000 | 4.10 | 3/04 | 2.64 sco | ||||
| AAPL 35 | 76.85 | 11/08/12 | |||||
| REPR* 5000 | 0.22 | 10/22/12 | .12 sco | ||||
Recommendations will be both listed in this letter and texted to members.
Previous closed out stock and option positions can be found in past Market Strategies Newsletter issues available in the Subscriber Members Area.
For those of you who do not buy puts to protect your portfolio, there are many ETF’s that are the inverse of the DOW. The symbols are DOG, DXD, SDS,TZA and RWM, which go up when the DOW, S&P 500 and Russell 2000 go down and down when they go up. The DZZ goes up double when gold goes down.
Market Strategies $100,000 Trading Portfolio
Recommendations And Overall Comments
We closed out Shares of BOOM and AA for profits of $ 1,517
and took a loss on HERO for $ 115.
Options positions last week made $ 2,036.
Profits for the year rose to $ 6,942
We have open position losses now of about $10,1250 some of which are in both coal stocks and small cap bio-med stocks held over from last year.
We also have not counted dividends received on stocks like Apple, Nordic American (NAT) and JP Morgan.
We have three long options positions:
BA July 130 Calls; CLDX July 16 Calls and KIRK July 20 Calls
The Stock table has the following 17 positions:
AA, AAPL, GRPN, GLXZ; GSG, FCX, HL, NBG (3),
OSIR, REPR, RPTP, SPXU, TEXQY, WLT, XRGYF
The options call for a $ 2,500 investment unless otherwise stated; each stock position requires $5,000 unless specifically stated.
We are basing money management on a hypothetical
$ 100,000 and are using
$ 3,124 in three options positions and
$ 58,393 in 17 stock positions totaling
$ 61,517 with $ 36,447 in cash.
These figures are approximate. We do not count commission costs and there may be errors.
Executions that have occurred at or near the open or close of trading sometimes vary from ouractual numbers. For example, when something opens down and it is through our price, we take the next trade whether it is an uptick or continues lower. This sometimes results in a 50% trade that is slightly above or below the exact number.
Previous Week’s Recommendations and
Rules for the Market Strategies
$100,000 Portfolio Trading Account
- All options count for about $ 2,500.00 for model portfolio calculations unless otherwise stated
- When the option has doubled sell half the position
- Stop Loss protection is either half or offered with each trade
- The cost of the option is the asking price (or the price between the bid and ask, whichever is more realistic)
- The options will be followed until closed out.
- Option Symbols are stock symbol with expiration month and strike price
| Option | Cost | Date | Sold | Date | Profit/(Loss) |
| BA July 130 8 lots | Calls1.28 | ||||
| TLT July 1108 lots | Calls1.53 | 06/23/14 | 3.06( sold on 100% profit rule)2.93 Sold Balance | 06/25/1406/25/14 | $ 612.00$ 560.00 |
| CLDX July 16 8 Lots |
Calls 1.50 |
06/19/14 | |||
| FCX July 35 16 Lots |
Calls 0.67 |
06/09/14 | 1.34( sold on 100% profit rule)1.08( sold balance) | 06/24/1406/25/14 | $ 536.00$ 328.00 |
| KIRK July 2020 lots | Calls 0.45 | 06/06/14 |
Note: Previous closed out stock and option positions can be found in past Market Strategies Newsletter issues available in the VIP Subscribers Members Area.
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This Weeks’ Economic Numbers and Media Data
| Monday | 09:45 hrs Chicago PMI June ( 61.0 vs 65.5 )10:00 hrs Pending Home Sales May ( 1.5% vs 0.4% ) |
| Tuesday | 10:00 hrs ISM Index June ( 55.8 vs 55.4 )10:00 hrs Construction Spending May ( 0.4% vs 0.2% )14:00 hrs Auto Sales June ( NA vs 5.7Mln Units )Truck Sales ( NA vs 7.7 Mln Units ) |
| Wednesday | 07:00 hrs MBA Mortgage Index 06/28 ( NA vs -1.0% )07:30 hrs Challenger Job Cuts June ( NA vs 45.5% ) 08:15 hrs ADP Employment Change June ( 200K vs 179K )10:00 hrs Factory Orders May ( -0.4% vs 0.7% )10:00 hrs Crude Inventories 06/28 ( NA vs +1.742 Mln Bbls ) |
| Thursday | 08:30 hrs Initial Claims 06/28 ( 315K vs 312K )08:30 hrs Continuing Claims 06/21 ( 2580K vs 2577K ) 08:30 hrs Trade Balance ( -$45.2 bln vs -$47.2 bln ) 08:30 hrs Unemployment Report June ( 6.3% vs Same )Total Payrolls ( 212K vs 217K )Private Payrolls ( 211K vs 216K )Hourly Earnings June ( 0.2% vs 0.2% ) Average Workweek ( 34.5 hrs vs Same ) 10:00 hrs ISM Services June ( 56.5 vs 56.3 ) 10:30 hrs Natural Gas Inventories 06/28 ( NA vs 110 bcf ) |
| Friday | Markets Closed for 4th of July Holiday |
Market Strategies Fundamentals
Stocks closed well. The S&P 500 has made at a record high 22 times this year. Good tape action at a time of poor economic numbers has caused many of the bears to think we are climbing a “ wall of hatred” instead of
“a wall of worry.” Some traders are looking for reasons why the market should go down rather than acknowledging why it has gone up. Many think we will open down 50-75 S&P points one morning. For that reason we always have on the books some short positions, while the bulk is basically long going into the next week.
Either Monday or Tuesday could see new all -time highs again and then the remainder of the short week depends on the major employment report Thursday.
We want to buy Puts on some the chemical companies that supply the farm belt. At the same time we would buy the RSP shares, an equal weight S&P which give credence to often overlooked mid-caps. Also the SPHB shares ( power shares high beta S&P 500 ) looks like a rally but there are no options liquidity in either.
DuPont Co ( DD: $ 65.44 ) – $ 2.99 on the week or 4.4%, cut its full year earnings guidance to $ 4.00-4.10 a share from $ 4.30-$ 4.40 as devastating weather conditions in the Midwest is taking its toll. The cold winter caused its crop protection herbicide sales to take a hit while sales of corn seeds are down because of dry weather. .In addition the refrigerant chemical business has been weakened by lower than expected selling prices. Raw material prices of components used in making ag chemicals are much higher priced than a year ago. Syngenta ( SYT: $ 75.09 ) has not performed much better but has too little option open interest while shown weakness along with DuPont.
Monsanto ( MON: $ 125.00 ) looks like it has made a top.
A new crop report will be issued tomorrow, Monday June 30th. It is expected to show improvement as the Northern Central Plains received much precipitation.. Use the improvement in weather as an opportunity to sell Monsanto ( MON: $ 125.) at $ 125.85 or better or buy the equivalent July or August Puts..
Precipitation throughout the farm belt improved soil moisture and crop conditions, but the continued dry conditions across the West and Central Plains ravaged crops and other vegetation. The modeled Soil Water Index indicated unsatisfactory soil moisture conditions across the southwestern third of the country, where impacts could be stress or wilting, and the Water Requirement Satisfaction Index indicated potential crop failure across much of the Southwest and Southern Plains. As of June 3rd, about 51 percent of winter wheat was in drought, down from 53 percent a month ago, 43 percent of the cattle inventory was in drought (down 1 percent), 29 percent of hay (down 1 percent), 22 percent of corn (down 4 percent), and 16 percent of soybeans (down 3 percent). June 2nd USDA reports indicated that 44 percent of the winter wheat crop was in poor to very poor condition, nationally (up 10 percent from a month ago), with state values of 78 percent in Oklahoma, 64 percent in Texas, 62 percent in Kansas, and 39 percent in Colorado. Nationally, 19 percent of the pasture and rangeland was in poor to very poor condition, with statewide values over 50 percent in California (70%), New Mexico (68%). US corn crop conditions for the 2014-2015 harvest are 59% in good condition, down 1 percentage point from the previous week, US Department of Agriculture data showed Monday.
The weekly survey slipped from last week’s mark of 60% but remains 7 percentage points ahead of the 2013 condition at the same point in the harvest, which was 52%, the USDA’s National Agricultural Statistics Service crop progress report for the week ended Sunday showed.
Of those surveyed, 17% of crops were in excellent condition — the best category designated by the USDA for crop condition — up from 2% a week ago and 7% at this point in 2013, coming off the drought-stricken crop of 2011-2012.
Market Strategies Economic Data
The number of Americans filing new claims for unemployment benefits fell marginally last week, but continues to point to steadily improving labor market conditions.
Initial claims for state unemployment benefits slipped 2,000 to a seasonally adjusted 312,000 for the week ended June 21, the Labor Department said Thursday.
Data on job openings has also pointed to strengthening job growth. The economy has experienced four straight months of job gains above 200,000, a stretch last seen in early 2000. The claims report showed the number of people still receiving benefits after an initial week of aid rose 12,000 to 2.57 million in the week ended June 14.That covered the survey period for household employment from which the jobless rate is calculated. Continuing claims had declined for five straight weeks, an indication that some long-term unemployed were finding work. The unemployment rate for people collecting unemployment benefits has held at 2.0 percent since April.
The GDP report for the 1st Quarter was a disaster. Canada had bad weather too, but their first quarter was at least positive. The Gross Domestic Product (GDP) in Canada expanded 0.30 percent in the first quarter of 2014 over the previous quarter.
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Market Strategies Technical Information
Support Levels S&P 500 1953-1946
Resistance S&P 500 1967-1996
Support Levels DOW 16,720
Resistance DOW 17,145
Support Levels QQQ 93.20
Resistance QQQ 94.50
Support Levels NASDAQ 4381
Resistance NASDAQ 4443
Market Strategies Cycles
July may be the best performing month of the third quarter, but the mostly negative results in August and September make the comparison easy. Two recent “hot” Julys in 2009 and 2010 where DJIA and S&P 500 both gained greater than 6% and a strong performance in 2013 have boosted July’s average gains since 1950 to 1.2% and 1.0% respectively which is not much to rave about. This strength inevitability stirs talk of a “summer rally”, but it has historically been the weakest rally of all seasons ( see page 70, Stock Trader’s Almanac 2014).
Trading on the day before and after the Independence Day holiday is often lackluster. Volume tends to decline on either side of the holiday as vacations begin early and finish late. Since 1980, DJIA, S&P 500, and NASDAQ have recorded net losses on the first trading day after. Russell 2000 is negative the trading day before and after.
Midterm-year July rankings are something of a mixed bag, ranking #5 for DJIA and S&P 500, averaging gains of 1.2% and 0.8% respectively (since 1950); while NASDAQ (since 1974) and Russell 2000 (since 1982) midterm Julys rank #11 and #12. NASDAQ has only advanced in three of the last ten midterm Julys with an average loss of 2.4%. Russell 2000 has advanced only twice in its last eight with an average decline of 4.3%.
But there are plenty of other ways to slice and dice ownership of this big-cap index. One of the most popular is the Rydex S&P Equal Weighted Index (RSP). Here, you abandon the idea of the S&P as a market-cap-weighted index (the biggest stocks get the biggest weighting) and instead all 500 stocks have the same weighting.
What this means is that you get proportionally greater exposure to the more “mid-cap” names in the S&P 500, since every stock is assigned the same weighting (0.2 percent of the fund). So the biggest stock by market cap, Apple (AAPL), with a $458 billion market cap, would have the same weight as, say, Union Pacific, with a $70 billion market cap. There’s also the old standby of investing in value or growth. The iShares S&P 500 Growth Index (IVW) invests in the faster-growing half of the S&P 500, while the S&P 500 Value Index (IVE) invests in the slower-growing half.
You might think that companies are defined as growth companies if they grow their earnings faster than their value counterparts, but it’s a little more complicated than that. Several different metrics are used, including price momentum, earnings per share, and sales per share, as well as price to book, price to sales, and price to earnings; S&P then ranks each stock by the ratio of its growth score to its value score.
There’s an opportunity to invest in value or growth. The iShares S&P 500 Growth Index (IVW) invests in the faster-growing half of the S&P 500, while the S&P 500 Value Index (IVE) invests in the slower-growing half.
You might think that companies are defined as growth companies if they grow their earnings faster than their value counterparts, but it’s a little more complicated than that. Several different metrics are used, including price momentum, earnings per share, and sales per share, as well as price to book, price to sales, and price to earnings; S&P then ranks each stock by the ratio of its growth score to its value score.
July Sector Seasonality (Stock Trader’s Almanac)
“One sector begins its favorable seasonality in the month of July, Gold & Silver based upon the Philadelphia Gold and Silver index. The Transport sector begins its seasonally weak period in July. As of this writing, there is still no Bear/Short ETF available that directly focuses on the Transport sector to take advantage of its seasonal weakness. No official trade will be made in the ETF portfolio. However, option traders could consider put options on iShares DJ Transportation (IYT) as it has a reasonably deep chain.
On the other hand, Gold & Silver offer numerous possibilities to trade. Because gold, silver and the companies that mine and explore for the metals have been significantly beaten down over the past month and are within striking distance of their respective 52-week lows, a diversified approach will be taken. As seasonal gold and silver strength begins, we will look to own both the physical metals and the miners at attractive prices. Global X Silver Miners (SIL), iShares Silver Trust (SLV), Market Vectors Gold Miners (GDX), SPDR Gold (GLD) can all be bought on dips below their respective buy limits (listed below in the ETF Portfolio). Should the buy limit for SLV be reached, we will simultaneously add SLV to the portfolio and sell ProShares UltraShort Silver (ZSL).
SIL top five holdings include: Silver Wheaton, Fresnillo, Primero Mining, Fortuna Silver Mines and Industrias Penoles. GDX top five holdings include: Goldcorp, Barrick Gold, Newmont Mining, Silver Wheaton and Newcrest Mining. SLV and GLD are physically backed ETFs that hold the actual metal in storage. GDX, GLD and SLV have billions of dollars in assets and trade millions of shares per day on average. SIL however, has assets of $206.7 million and daily trading volume around 200,000 shares per day, substantially less, but still sufficient to trade.”
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Rule 17B Attestations
Princeton has approximately 2,581,578 shares of AIVN both free and restricted and represents them for I.R.. Princeton also has about 40,000 shares of TXGE. Princeton is paid $ 1,500 per month from RMS Medical Products. Princeton has bought 81,100 shares of RMS Medical Products. Princeton Research has been paid $ 2,500 to write a report on Xinergy.
Princeton has been engaged by Target Energy. No contract is currently in place. When there is no movement in penny stocks, even though there is none or very small losses, we will liquidate ( sold AIVN on stop ) even though we like the company, if money is needed for better opportunities.
We now believe REPR represents upside opportunity. The Target ADR trades at about $ 4.50 in U.S. vs 0.045 in Australia. Princeton owns 400,000 Australia shares and about 500 U.S. ADR’s. Princeton was paid about 500,000 shares of Leo Motors.
Pursuant to the provisions of Rule 206 (4) of the Investment Advisers Act of 1940, readers should recognize that not all recommendations made in the future will be profitable or will equal the performance of any recommendations referred to in this e-mail issue. Princeton may buy or sell its free-trading shares in companies it represents at any time.
CONTACT
Please Direct All Inquiries To:
Mike King
(702) 650-3000
Princeton Research
3887 Pacific Street,
Las Vegas, Nevada 89121
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