Swing Trades, Oil Stupidity

by John Dalt

12/31/08

Today was last day of the year, so let’s do some house cleaning. The 20-year treasuries ETF (TLT) I have mentioned has been moving down since its high on 12/18. Currently it has lost 5%, yesterday’s Investors Business Daily ‘Big Picture” article reported that the “the 10-year Treasury fell to 2.11% from 2.14% late Friday. The market for short-term commercial paper fell by $6.94 billion the week ended Dec. 24, the first drop in nine weeks.” I still maintain it might be dangerous to fight the FED, but if we see strength on this, it may be a GREAT short.

If you had bought GLD on 1/2/08 at the open for $83.56, you would have made money.  GLD closed today at $86.52, I checked the weekly charts, and GLD would have made money every year for the last 4 years. 

I closed six swing trades today.  This made 14 closed trades on the Swing Trade Service with an average gain of 4.6%.  That really adds up!  Currently, you can see these free on the ‘Swing Trade’ page of the web site.  I update it daily.  We will offer a premium paid service with e-mail updates soon.  I invite you to follow along if you would like, you can visit it here.  This is FREE for you. 

Another web site feature is the Long-Term Portfolio.  These are my current recommendations for the long-term investor.  Again, this will be a paid service soon, but for now, it is FREE to you. You can check it out here. 

Another feature of the web site you might find useful is the News Feeds page.  I check this on and off during the day.  There are three different news feeds featured.  You can click on a headline and read any story for quick information.  It is faster than reading a paper or watching the evening news.  Many times, all they do is read the headlines!  Check it out here. 

The market drifted higher today to finish out the year.  I expect the first few days of the new year to be lower.  One of the trades closed out today was the crude oil (USO) position discussed on 12/22/08.  I wrote “The price will not depend on shortages at the moment, but the perception of supply disruption.”  This was exactly what happened today.  I was able to grab 7% in 14 days.  There is still oversupply on the market; I will buy it back in January.  Crude went up today because Russia is threatening Natural Gas supply to the Ukraine.  The pipeline through Ukraine also supplies Western Europe.  This was a stupid reaction.  You cannot use crude oil to heat homes that have natural gas heaters.  One TV talking head said Russia was cutting off Gas, as in gasoline.  DUH!  This happens sometimes, a rumor causes a price disparity that is unfounded.  There may be other factors, but it never hurts to take profits! 

This has been a great year.  Not necessarily in the market, but we are all here at the end!  Hope you had a great Christmas and enjoy the KU game tonight. 

WARNING:    The information presented in this newsletter is based on generally available news releases, corporate filings, current events, interviews and the editor’s opinions.  It may contain errors and you should not make investment decisions based solely on what you believe you have read here.  Do your own research, it is your money.  If you lose it, it is your responsibility, not ours or your grandmothers!  The editor may or may not have a position in any securities discussed.  The editor may have held a position in a security earlier, or in the future.

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