The Golden Apple Short

I am now short AAPL and Gold. Neither one has broken but I believe those breaks to be very near. APPL 255.35 is just below its 50 day of 257.95 and is sneaking through it with no fanfare. I like this kind of action because it reduces the significance of this important average. Not to mention that this is the 4th time it has broken it in the last 7 weeks.

Gold (GLD) is trading at 121.55 its 50 day is at 118.47. Most if not all the people I talk with feel that Gold is bullet proof. Those are the conditions that develop before a crash. I think that it is getting ready to crash.

I am calling these short positions the Golden Apple. Want to take a bite??? I didn't think so.


Message for Al... Bought the SCO at 15 today..Double short Oil
Updated my picks at socialpicks.co/mikey22222
Note: AAPL closed at 251.49 could bounce back to 50 day at 258 would add to it there.

Mikey

CANDIES trend is reversing

The latest and greatest of the hot stocks story is starting to reverse trend. Before this last rally the Candies ( CMG, AAPL, NFLX, DECK, ISRG, ESRX, CRM) relative strength caused the experts(Cramer et al) to recommend to the public to buy these stocks because they held up the best in the decline. Their charts all look the same.


CMG


AAPL



NFLX



DECK



ISRG




ESRX




CRM




These stocks are in big big trouble. Notice the MACD has a non confirmation on the new highs of all of these stocks. The short term trading objective is the 200 day is for all of these. CMG 108, AAPL 218, NFLX 72, DECK 114 ESRX 45, CRM 72 ISRG has already broken the 200

Mikey

My Two Favorite Shorts AAPL and Gold

My two favorite shorts are Gold and Apple. I'll be darn that they have two articles on these today that say they are both going to go parabolic. What a surprise.
Here are the articles.


On Monday investors were chattering about the upside in gold [GCC1 1238.2 -17.6001 (-1.4%) ] even though the precious metal has already surged 12% over the past 6 months.

The bullish speculation was largely triggered by the outcome of this past weekend’s G20 summit, in which world the leaders fell back on the "Sinatra doctrine" – that is, leaving each nation to do it "my way".

That’s a pithy way of saying each nation plans to adopt different and tailored policies in dealing with the European debt crisis; and not take a unified approach.


Instant Insights from the Fast Money desk

In the wake of these developments widely followed commodities investor Dennis Gartman tells the Fast Money desk gold could make a sharp move higher - in fact it could be parabolic.

”I hesitate talking about parabolic moves – but when you compare this period to other periods of time in the past (when we’ve had parabolic moves), that’s what well may happen,” he says during a live interview.

Parabolic moves in commodities tend to fall into patterns, Gartman goes on to explain.

“The market starts slowly and takes several years to build.

Then, in the last 10% of the time frame you get 50% of the price movement. I've seen it time after time in 35 years of doing this. And I get the sense that gold is about to do that same thing."

Gartman also feels that gold has room to run because it's something he calls the anti trade. “It’s anti dollar, anti euro and anti the British pound,” he says.

And if you're worried that we're looking at a bubble because retail investors are driving the run in gold, don't be. According to Gartman it's largely institutional money and not money from Main Street.

What’s the bottom line?

"The propensity for people at the margin to move into gold continues," says Gartman. "The trend is up and I continue to be bullish of gold."



---------

APPLE DRIVES TECH GAINS

The bulls spent Monday fighting early weakness in the market by pushing technology shares [XLK 21.542 0.067 (+0.31%) ] higher.

Blockbuster sales of Apple’s [AAPL 268.141 1.441 (+0.54%) ] latest gadget – the iPhone 4 -- ignited enthusiasm across the sector. 1.7 million units were sold over the first 3 days the device was available to customers. Chip stocks [SMH 27.49 0.32 (+1.18%) ] traded higher broadly on the phone’s success.


If we were not in this market environment I think Apple shares would already be north of $300, says Jon Najarian. I believe its Apple’s strength that’s driving tech.

But with those kinds of sales and the best product launch in Apple history, the stock should be higher, muses Brian Kelly. I think investors should separate Apple from tech, broadly.



I can only say that to have Dennis Gartman on the other side of my trade is a comfort. I love that this article appears when Gold is down 17 bucks. Remember the other article telling us to buy the seasonal pullback? Nice.

Apple has been all over the news lately announcing great sales of the IPAD and the new I PHONE yet the stock is slowly selling off. Just like Gold the news is great.

Charts look amazingly similar don't they?

Gold 1240.80 -15.40


AAPL 268


I expect both to be at their Feb lows real soon.

Mikey

That was the week that was (TW3)

Monday 6/22/10 DJIA 10442.41 -8.23 10 year note 3.25% 1240.70-17.60 Dollar Index 86.23 +.26 Oil 77.82 +.64

China allows Yuan to rise against the dollar. The market rallies and then fades.
More than 1/3 of the borrowers in the loan modification program drop out.

Tuesday 6/23 DJIA 10293.52 -148.89 10 Year Note 3.17% Gold 1240.80 +.10 Dollar Index 86.40 +.17 Oil 77.21 -.61
Home resales fall in May by 2.2% to 5.5 million annual rate.

75% of the banks have repaid TARP money causing Geithner to call the program a success. The US earned 21 billion in profits.

UK unveils austerity budget and raises value added tax and increases capital gains tax to 28% from 18%. Big banks will also be taxed.

Wednesday 6/24 DJIA 10152.80 -145.64 10 year note 3.13% Gold 1234.80 -6.00 Dollar Index 86.04 -.36 Oil 76.35 -1.50
Oracle beats Q4 EPS by 40%. 30 year Mortgage rates fall to record lows at 4.69%.
Durable Goods rose .9%

Thursday 6/25 DJIA 10298.44 +4.92 10 year note 3.11% Gold 1245.50 +1.40 Dollar Index 86.01 -.03 Oil 78.06 +2.35
New home sales at record low sales plunge 32% in May as tax credits expire. Medium price of homes fell 1% to 200,900.

Obama sacks US commander McCrystal

14,100 filers wrongly received housing tax credits including 1300 prisoners.

Friday 6/26 DJIA 10143.81 -8.99 10 year note 3.11% Gold 1256.70 +10.30 Dollar Index 85.57 -.44 Oil 78.06 +2.35
Financial reform bill deal reached. Biggest since great depression. Should raise costs to banks and borrowers. will add 20 billion in taxes on banks and hedge funds. Derivatives that are related to equities, commodities and credit default swaps that are not investment grade will have to be held in a capitalized subsidiary.

Consumer confidence hit a 29 month high with the University of Michigan index rising to 76 highest since Jan of 2008.


Notice the 10 year note falling from 3.28% on Monday to 3.11% on Friday. The news which was bad all week ended with the rather comical rise in the consumer confidence survey that ended in a 29 month high. Interest rates are falling and in a hurry and the stock market is fading. The economic news is bad but the recovery hype is keeping the public optimistic. Mortgage rates hit a 30 year low and that means something. It means that the economy is in bad shape. I continue to like the short side of this market.

Mikey

Gold (1246) Propaganda 101

Here is the lastest article on CNBC on Gold Current price 1246


Central Banks Join the Ranks Of Investors Who Like Gold
Is the world going back to a gold standard?

Not really. But with central banks around the globe holding more gold in reserve, it certainly has people talking.

Gold has been rising because of increased demand and decreased supply, U.S. Global Investors' Ralph Aldis said. Although in the past sales by central bankers made up for the difference, nowadays central banks are becoming net buyers.

“We will see some derivation of a gold standard in the next 5 to 10 years," said Brian Hicks, U.S. Global Investors money manager, in a conference call this week with financial advisors and consultants.

A true gold standard would mean you could exchange paper notes for a fixed amount of bullion. While Hicks isn't suggesting that, he expects there will be “some percentage, perhaps 20%” of reserves will be in a “basket of currencies”.

When asked to clarify this comment after the call he added: “We have been seeing baby steps in the direction of countries holding more gold in their official reserves, and that this gold in effect is backing their currency.”

America gradually moved away from a gold standard beginning with World War 1. Then, in 1971, President Nixon closed the gold window, ending the ability of Americans to convert US dollars into gold at a fixed price gold of $35 an ounce.

"A handful of central banks are buying gold as a small portion of their monetary reserves," Jeff Christian, founder of CPM Group said. "There is a gigantic difference between that and governments collectively using gold as the basis for currency valuations—which is what a gold standard is."

Because the US is the biggest holder of gold in the world—with about 8,133 tons—the dollar is in some sense backed by gold, but not in the traditional sense of a gold standard.

"Dollar value is not backed by gold but by the sum of the U.S. government's assets, of which the military is our primary asset," Christian said.

When asked if we could return to a gold standard, Christian replied: "Only gold bugs are talking about this."

Still, Hicks' comment on a gold standard was just part of the bullish tone on the U.S. Global Investors conference call.

U.S. Global Investors’ Ralph Aldis led much of the call – he is Sr. Research Analyst and co-manager of U.S. Global Investors Gold & Precious Metals [USERX 16.89 0.02 (+0.12%) ] and U.S. Global Investors World Precious Minerals Fund [UNWPX 18.53 -0.01 (-0.05%) ].

Aldis gave a synopsis of some of the fundamental reasons for why gold has been rising starting with the basics: more demand, less supply.

About 3000 metric tons of gold are “consumed” each year—by the jewelry industry, investors and industrial users—while only about 2,200 tons are being mined. While the gold market has been more or less in that situation for years, sales by central bankers usually made up the difference. That is no longer true. In fact, central banks have become net buyers.

Hicks added some details after the call. “You are seeing central banks buying more gold," he said. (According to the World Gold Council, Saudi Arabia has more than doubled its official gold reserves, and Russia bought more than 25 metric tons in the first quarter of 2010).

"At the same time, European central banks are selling far less gold than in recent years,” he added. “Gold sales under the Central Bank Gold Agreement—the year for them ends in September, and so far only 41 metric tons have been sold—about one-tenth of the allowable amount.”


The European central banks are selling less gold than in recent years, said Brian Hicks, U.S. Global Investors money manager.

Aldis also discussed how China has become not just the biggest producer of gold in the world (325k tons/year) but also, how it is quickly turning into its biggest consumer.

None of the gold being produced in China, leaves China. It is all sold on the Shanghai exchange and purchased by the Chinese government - which takes an awful lot of production out of circulation.

In addition, Chinese consumers are being encouraged to diversify their assets and are buying gold for both jewelry and investment. And that gold is generally being imported into China.

Historically, there have been periods where gold stocks have outperformed bullion, and vice versa. But Aldis expects stocks to outperform the physical asset in part, because of differing tax treatments—especially relevant if you’re shopping for commodity ETFs.

Aldis said interest rates will need to go up and debt to go down before you see a headwind to gold. And with central banks here and in Europe fighting deflation, you may not see that for some time.

Finally, seasonal demand usually picks up in the August, September time period when the jewelry buyers step into the market.

“People have been waiting for the price to correct, but we have unusually high amounts of debt and we are not seeing the usual summer sell-off,” Aldis said. He suggested that investors watch for dips to get long during the summer lull and notes, “17 of the past 18 years we have had a seasonal rally.”


All very impressive but I remember when the Central Banks were supposedly selling their Gold. That was in 2000 and 2001 at 280 to 300. I remember that they were saying that Gold was no longer considered money. It paid no interest and it was a relic of the past. They now are saying that Gold is the only true money and that the world has lost confidence in all governments and their curriencies. They say Gold will not drop until interest rates rise. I also remember that in 2000 and 2001 that the mutual funds were CLOSING their Gold stock funds due to lack of interest.

This article is saying that there are only buyers and no sellers. It is telling you to come to the party. It then says that, seasonally, it pullbacks in the summer and rallies in August and September and to use this pullback to buy. It tells you that 17of the past 18 years we have had a seasonal rally in August and September. I am betting that 17 out of 19 will be the scorecard after September. Party on Gold Bugs.

Mikey

Salesforce Dot Com

This stock ahs been heavily recommended for the past 6 months. What have the insiders been doing?

Insider Transaction History
Date Name-Position Transaction Shares Price Range ($) Shares Held Mkt Value
6/21/10 Benioff Marc R
Chief Executive Officer Sale 10,000 96.19 – 96.19 11,781,000 $961.9 K
Van Veenendaal Fran...
Officer Sale 1,500 97.41 – 97.41 13,795 $146.1 K
Harris Parker G
Officer Sale 467 97.41 – 97.41 532,548 $45.5 K
6/18/10 Harris Parker G
Officer Sale 467 96.50 – 96.50 533,015 $45.1 K
Benioff Marc R
Chief Executive Officer Sale 10,000 96.00 – 96.00 11,791,000 $960.0 K
6/17/10 Benioff Marc R
Chief Executive Officer Sale 10,000 96.46 – 96.46 11,801,000 $964.6 K
Harris Parker G
Officer Sale 467 94.88 – 94.88 533,482 $44.3 K
Young Shirley
Director Sale 10,000 96.00 – 96.00 32,500 $960.0 K
Young Shirley
Director Exercise of Options 10,000 25.19 – 25.19 32,500 $251.9 K
6/16/10 Smith Graham V
Chief Financial Officer Exercise of Options 4,000 52.28 – 52.28 8,442 $209.1 K
Benioff Marc R
Chief Executive Officer Sale 10,000 94.07 – 94.07 11,811,000 $940.7 K
Smith Graham V
Chief Financial Officer Sale 4,000 93.82 – 93.82 8,442 $375.3 K
Harris Parker G
Officer Sale 467 93.82 – 93.82 533,949 $43.8 K
6/15/10 Benioff Marc R
Chief Executive Officer Sale 10,000 94.58 – 94.58 11,821,000 $945.8 K
Smith Graham V
Chief Financial Officer Sale 2,500 93.75 – 93.75 8,442 $234.4 K
Harris Parker G
Officer Sale 467 93.75 – 93.75 534,416 $43.8 K
Benioff Marc R
Chief Executive Officer Stock Gift 15,000 0.000 – 0.000 11,821,000 $0.0
Smith Graham V
Chief Financial Officer Exercise of Options 2,500 25.97 – 25.97 8,442 $64.9 K
6/14/10 Benioff Marc R
Chief Executive Officer Sale 10,000 94.89 – 94.89 11,846,000 $948.9 K
Van Veenendaal Fran...
Office6/11/10 Harris Parker G
Officer Sale 42,873 90.81 – 93.17 535,350 $3.9 M
Robertson Sanford R
Director Sale 3,000 93.46 – 93.46 -- $280.4 K
Benioff Marc R
Chief Executive Officer Sale 10,000 94.89 – 94.89 11,856,000 $948.9 K
Robertson Sanford R
Director Planned Sale 3,000 -- – -- -- $280.1 K
6/10/10 Benioff Marc R
Chief Executive Officer Sale 10,000 91.60 – 91.60 11,866,000 $916.0 K
Harris Parker G
Officer Sale 467 91.37 – 91.37 578,223 $42.7 K
6/9/10 Benioff Marc R
Chief Executive Officer Sale 10,000 90.08 – 90.08 11,876,000 $900.8 K
Harris Parker G
Officer Sale 467 89.23 – 89.23 578,690 $41.7 K
6/8/10 Benioff Marc R
Chief Executive Officer Sale 10,000 87.82 – 87.82 11,886,000 $878.2 K
Harris Parker G
Officer Sale 467 89.00 – 89.00 579,157 $41.6 K
6/7/10 Benioff Marc R
Chief Executive Officer Sale 10,000 88.86 – 88.86 11,896,000 $888.6 K
Van Veenendaal Fran...
Officer Sale 1,500 90.07 – 90.07 16,795 $135.1 K
Harris Parker G
Officer Sale 467 90.07 – 90.07 579,624 $42.1 K
6/4/10 Benioff Marc R
Chief Executive Officer Sale 10,000 91.93 – 91.93 11,906,000 $919.3 K
Harris Parker G
Officer Sale 467 92.66 – 92.66 580,091 $43.3 K
6/3/10 Benioff Marc R
Chief Executive Officer Sale 10,000 93.58 – 93.58 11,916,000 $935.8 K
Harris Parker G
Officer Sale 467 89.31 – 89.31 580,558 $41.7 K
6/2/10 Benioff Marc R
Chief Executive Officer Sale 10,000 87.04 – 87.04 11,926,000 $870.4 K
Harris Parker G
Officer Sale 467 85.69 – 85.69 581,025 $40.0 K
6/1/10 Van Veenendaal Fran...
Officer Sale 1,500 84.97 – 85.00 18,295 $127.5 K
r Sale 1,500 96.69 – 96.69 15,295 $145.0 K
6/1/10 Schellhase David R
General Counsel Sale 137 84.70 – 84.97 3,563 $11.6 K
Benioff Marc R
Chief Executive Officer Sale 10,000 85.68 – 85.68 11,936,000 $856.8 K
Conway Craig A
Affiliated Person Planned Sale 3,000 -- – -- -- $259.6 K
Dibianca Suzanne
Unknown Planned Sale 100 -- – -- -- $8.5 K
Harris Johnson Fami...
Trustee Planned Sale 3,736 -- – -- -- $317.6 K
5/28/10 Schellhase David R
General Counsel Exercise of Options 365 0.000 – 0.000 3,563 $0.0
Harris Parker G
Officer Sale 622 86.44 – 86.48 581,959 $53.8 K
Van Veenendaal Fran...
Officer Sale 78 86.44 – 86.44 19,795 $6.7 K
Schellhase David R
General Counsel Sale 68 86.44 – 86.44 3,335 $5.9 K
Benioff Marc R
Chief Executive Officer Sale 10,000 86.47 – 86.47 11,946,000 $864.7 K
Hu George
Officer Sale 417 86.44 – 86.44 1,276 $36.0 K
5/27/10 Smith Graham V
Chief Financial Officer Sale 613 85.38 – 85.38 8,442 $52.3 K
Van Veenendaal Fran...
Officer Sale 154 85.38 – 85.38 19,664 $13.1 K
Harris Parker G
Officer Sale 621 85.38 – 85.38 582,164 $53.0 K
Benioff Marc R
Chief Executive Officer Sale 10,000 86.31 – 86.31 11,956,000 $863.1 K
Hassenfeld Alan Geo...
Director Sale 25,000 86.39 – 86.39 15,000 $2.2 M
Schellhase David R
General Counsel Sale 121 85.38 – 85.38 3,221 $10.3 K
Hu George
Officer Sale 209 85.38 – 85.38 1,276 $17.8 K
Hu George
Officer Exercise of Options 417 0.000 – 0.000 1,276 $0.0
Hassenfeld Alan Geo...
Director Exercise of Options 25,000 8.00 – 8.00 15,000 $200.0 K


I believe them!! Technically a close below 89 is a reversal.



Mikey

I went to the Mall today and the first thing that I saw was a for lease sign on a Mervins Store. The stores that I went in had 60% off signs all over the place. This is antidotal evidece that Bernanke's testimony last week about the recovery is a bald faced lie.

This blog will not be about the economy It will be about great shorts. I present to you the following charts:

AAPL 270.80



CRM 95.95



DECK 160.33



ESRX 51.92




In addition with the rcent options expiratiom rally I am rebuying the following Short ETF's, which have pulled back nicely

SMN 37.00



EDZ 40.13



SCO 14.08



I am still adding to DZZ 10.96



and ZSL 32.53




Mikey

The story turns toward Deflation

I have been talking about Deflation for the past year. This story appeared on the CNBC website today.

Economists and policymakers generally don't take the D-word lightly, but when enough economic indicators show falling prices, it's time to ask if deflation, not inflation, is the more immediate threat to the US economy.

By one measure or another, reports on producer prices, consumer prices and import-export prices in the past week all showed declines—meaning falling prices—and they're hardly the first negative readings this year.

"There's clearly deflationary pressure," says Dean Baker, co-director of the Center for Economic and Policy Research, who worris that the "economy is just drifting along."

"We haven't seen an economy like this in 70 years," adds David Resler, chief economist for Nomura Securities.

Resler's referring to the intermittent recovery period following the Great Depression, marked by high unemployment, anemic growth and, yes, deflation—which depressed prices on everything from bread to stocks.

For much of the past 16 months, however, as stock prices stormed back, investors have been focused on the prospects of an inflationary spike, but history shows deflation is a greater threat and may very well be more of consideration in the Federal Reserve's monetary policy.

Deflation is the economy's version of a vicious cycle. As prices fall, so do wages and profits. Demand, consumption and production also fall. Jobs are cut. Consumers put off purchases. Plants slow. Prices and wages fall again. The negative forces feed off of each other. What's more, as cash becomes more precious, debt becomes more painful. Lower interest rates are lowered—eventually to rock bottom—and become a dead-end.

Some of those conditions, if not the full dynamic, are clearly extant in the current economy.

"We have much of the economy unemployed, capital and labor resources underutilized, and excess capacity to produce goods, so producers have a difficult time raising prices." says Resler.

Of course, some are having to cut prices.

Though both the PPI and CPI are marginally positive this year—meaning prices overall have been rising—both inflation gauges posted negative readings last year and more than a few economists find that disconcerting.

"We see it as uncomfortably low," says Scott Anderson, senior economist at Wells Fargo, who sees a double dip in housing and a significant slowdown in consumer spending, two forces with the potential to drive down prices. "There isn't the fuel you need to really get inflation going."

Resler notes that over the past year a third of the 29 components in the CPI have declined in any given month. By contrast, during the 90s, when inflation was higher than today but moderate by historical standards, the ratio was a third. During the high inflation periods of the 1970s and 1980s, no more than one or two of those components would fall in a month. Sometimes, not one of them declined.

Some of the declines in the recent period were categories such as apparel and lodging.

"Those are things that reflect consumer discretionary spending," says Resler.

A month ago, Resler's team warned there's a 25-percent chance that core inflation—which excludes food and energy—will be flat in 2010.

"If we had an unchanged core [now at just under 1.0 percent] for several months, the year-over-year change would be pushed down to 0.4 percent," estimates Resler, which would easily beat the record low of 0.7 percent set in 1961.


The behavior of the CPI in 2009-2010 has more in common with the period eight years ago right before the Fed shared its concerns about deflationary risks and in doing so cut rates to 1.00 percent in mid 2003.

Economists say the risks are greater today than in 2003, even if the Fed has said less about it.

The auto, banking, consumer and housing sectors are all clearly weaker. Mortgage debt is higher while lending is much lower.

"The debt over-hang is still "a real issue," says Anderson. "That's why in many ways this is more insidious."

"You need pristine credit to get a loan," says Anthony Sanders, a professor at George Mason University and the Mercatus Center. "And that's what causes deflation. You need risk-taking."

The Obama administration's stimulus plan and other initiatives, the scourge of inflation hawks, is also a contributing factor, according to the deflation camp.

"This rampant government spending is making deflation a greater possibility," says Sanders. "It's crowding out the private sector, which would be spending money on projects that it sees as profitable and also has a higher profit margin."

Right now, the deflation debate is more about possibility and probability, rather than reality, with disinflation—rare itself—the actual case.

"I can understand people who have concerns about deflation looming," says FAO Economics chief economist Robert Brusca, who is not among the believers. "But you should be careful in assuming there is something special going on."

Brusca says history shows the CPI usually hits a low point around one year into the recovery period and that one big difference this time is that the inflation rate was historically low before the recession even began in late 2008.

Another big difference, says economists, is that the Fed has more counter-deflation policies in place, which has already helped.

That also helps explain the central bank's decision thus far to leave monetary policy alone. never mind remove any of its emergency measures, positions it is expected maintain at its June 22-23 meeting.

"It's certainly one reason why the Fed will be on hold until mid 2011," says Anderson. "Fear is growing at the Fed about an adverse trend in inflation. Instead of talking about an exit strategy, it becomes a question of perhaps even restarting assets purchases."

Or, as Baker, suggests "taking quantitative easing to another level."

Going forward, the deflation dynamic is likely to get even more complicated, thanks to a spate of new negative forces, including a spike in the value of the dollar, a slump in oil prices, a double-dip in housing and the sovereign debt crisis in Europe, which simultaneously promises government austerity measures and more cheap-money borrowing.

There's also future Obama administration policy moves to contend with, notably a hike in income tax rates for the highest earners in 2011.

"We're relying on the top five percent to keep spending and we're planning on taxing them more," quips Sanders, who also cites the government's relentless support of the big banks as a major mistake. "We're taking the Hoover-Roosevelt playback and following it page by page."

Options expire and June puts go to Heaven

DJIA 10429 +26.30 SPX 1118 +1.96 Nasdaq 2310 +3.11 VIX 23.80 -1.25 Gold 1258.4 +9.70 Silver 19.15 +.379 Oil 77.04 +.25 RBOB(retail gas)2.14 -.019 Nat Gas 5.03 -.13
DBC(Commodities)22.37 -.06 EURO 1.2373 -.0014 Aussie .8692 +.0024 Dollar 85.95 -.03
EEM (Emerging Market Index)39.90 +.16 EWZ (Brazil)67.27 +.43 FXI (China) 40.62 +.01
TLT (LT US Bonds)97.60 -.25 IEF (7-10 yr US Bonds)93.55 -.18 GDX(Gold Miners)54.14 +1.18 IYR (Real estate)51.17 -.21 (XLF Financials)14.82 +.04 XLE (Oil) 55.55 +.03 XLB (Materials)30.95 +.04 XRT (Retail)39.46 -.40 XLK (Tech)22.33 -.08 XLV (Health care)29.58 -.28 XHB (Homebuilders)15.86 -.16


Today is options expiration's day. The first week out of the May expiration was below 10000 and Europe was collapsing. The VIX was in the mid 30's and the boys were calling for a correction. The oil spill was in full force and the picture was grim. Miraculously on options expiration's we have rallied 600 points from that mess and the world is a safer place. Who would have known?

That is the nature of this game and it never changes. Reality is what they say it is particularly in the short run. I am trying to guess their story just as you are. So where does it go from here. I think there is still some more works to do on the upside to convince the shorts that they are in the wrong place. I am sold on the idea that a hit on Gold will happen as the story puts on its rose colored glasses.

Gold "broke out" today and it trading at 1261. I added to my DZZ today at 10.46 on this breakout.


The VIX Back in its normal range




The DJIA has rallied from first of June note the relationship. Please note the MACD has rallied back up to the zero line. A rollover is a sell signal.




Mikey

Put Buster rally continues

DJIA 10370 +180 SPX 1140.40 +20.77 Nasdaq 2296.39 +52.36 VIX 25.96 -2.62 Gold 1234 +9.70 Silver 18.58 +.17 Oil 76.83 +1.71 RBOB(retail gas)2.1198 +.043 Nat Gas 5.18 +.18 DBC(Commodities)22.35 +.34 EURO 1.2346 +.0095 Dollar Index 86.23 -.566
EEM (Emerging Market Index)39.72 +.95 EWZ (Brazil)66.73 +1.76 FXI (China) 40.86 +.75
TLT (LT US Bonds)96.32 -.37 IEF (7-10 yr US Bonds)92.96 -.35 GDX(Gold Miners)51.02 +1.12 IYR (Real estate)52.04 +.87 (XLF Financials)14.70 +.25 XLE (Oil) 55.35 +1.31 XLB (Materials)30.94 +.57 XRT (Retail)40.55 +.36 XLK (Tech)22.19 +.50 XLV (Health care)29.59 +.38 XHB (Homebuilders)16.49 +.26

Stocks rallied Tuesday as the euro gained against the dollar after a number of successful European debt auctions eased investor concerns about the euro-zone's solvency crisis. Just in time for the June option expiration's and the end of the quarter window dressing. What is window dressing? I will address this in a future blog.

I expect this rally to hold or go higher until the end of the month. The VIX should be below 20 for me to initiate shorts. I will add to my DZZ on when Gold closes below 1200

Mikey

Why are we in Afghanistan? Read this

DJIA 10190 -20.18 SPX 1089.63 -1.97 Nasdaq 2243.96 +.36 VIX2 8.58 -.21 Gold 1223.30 -5.60 Silver 18.41 +.18 Oil 75.12 +.24 RBOB(retail gas)2.06 -.0129 Nat Gas 5.05 +.053 DBC(Commodities)22.01 -.21 EURO 1.2265 +.0165 Dollar Index 86.49 -1.027
EEM (Emerging Market Index)38.77 +.01 EWZ (Brazil)64.97 -.68 FXI (China Index)40.11 -.6
TLT (LT US Bonds)960.91 -.50 IEF (7-10 yr US Bonds)93.32 -.08
GDX(Gold Miners)49.90 -.89 IYR (Real estate)51.17 +.06 (XLF Financials)14.45 -.06 XLE (Oil) 54.04 -.28 XLB (Materials)30.37 -.30 XRT (Retail)40.17 -.42 XLK (Tech) 21.70 -.04 XLV (Health care)29.28 +.12 XHB (Homebuilders)16.23 +.11

Investors shouldn't get too excited about the trove of mineral treasures found in Afghanistan. Experts say it could take at least a decade before the discovery yields anything in the marketplace.

Though the future potential is extreme, the immediate impact of the mother lode in iron, copper, gold, cobalt, niobium and lithium likely will be nil.

A host of logistical, political and and geographical barriers must be dealt with first.

"This is huge news. It's the kind of thing that can have an impact on psychology today and may have an impact on psychology tomorrow," says Dennis Gartman, who manages a hedge fund and edits the daily Gartman Letter. "But it's a mining project. That's 10 years in the future."

Early estimates for the discovery, disclosed by the New York Times, are about $1 trillion.

Such a level surely would be enough to impact world markets and set off geopolitical battles over who will get to mine the rich deposits. But the extent to which it actually impacts prices and the broader Afghanistan economy isn't even close to being determined.

"The United States and China will find themselves butting heads their often," Gartman says. "They're both going to try to influence any government that exists there."

Indeed, there's also the complicated governing structure in the country, in which President Hamid Karzai's government holds a tenuous grip over national affairs while the Taliban is a continuous disruptive force.

"There are some pretty big issues given Afghanistan's land and infrastructure," says Philip Silverman, managing partner and chief trader at Kingsview Management, a commodities trading advisory firm in New York. "It's certainly going to complicate the situation in Afghanistan, with the Taliban and the world."

Investors should watch how the contracts are awarded and any signs of development in Afghanistan that could accompany the find.

Getting the goods to market while overcoming the country's primitive mining system will be among the key challenges, Silverman says.

Find Could Be Worth $1 Trillion Europe Troubles to Intensify: RossGartman 'Appalled' by Spill Reaction

"We would be looking to see when they start talking to some of the private industries and seeing how they would be looking to bring them in, and closely looking at what's going on in the military conflict," he adds. "One trillion dollars worth of minerals below the ground could certainly embolden the Taliban to a place where it might not calm things down. It might layer a whole new set of problems on the situation."


I thought we were trying to find Osama. It turns out they are the Saudi Arabia of Lithium...you know batteries for your cell phone. SANTA MARIA !!! Well at least I know what are troops are fighting for.....Blackerries.

I love this story because it is the perfect cover story to take Gold down because if they do it now everyone will say that the price move was an over reaction. The truth is Gold is ready to dive.

Some Charts

Homebuilders: No gain from August of last year After all those tax credits



GDX Goldminers No gain since October of 2009 After all the Gold hype



XLF Financials Same price as August of 2009 after the TARP was paid back






Mikey

Don't rule out a rally from here

DJIA9938 +122.97 SPX 1062.02 +11.55 Nasdaq 21.70 -3.33 VIX 33.67 -2.90 Gold 1237 -3.50 Silver18.25 +.09 Oil 72.03 +.59 RBOB(retail gas)1.989 -.0056 Nat Gas 4.79 -.11 DBC (Commodities)21.46 +.17 EURO 1.1952 +.0028 Dollar Index 88.37 -.09

We are at the low end of a trading range and the VIX is high and the mood short term is negative. This sets up for that rally I expected in June to tell everyone that Europe is going to be OK and this sell off was just a bad dream. Gold would be a loser in this scenario.

Besides Ben says:Federal Reserve Chairman Ben Bernanke said he doesn't expect the economy to slide back into recession. Now we would not want to disappoint Ben.

The public is also starting to get ready to sell so now would be a good time for them to take off the edge a little. Why? Because they(the boys) don't want to buy the stock now. So I expect a rally soon plus as an added bonus it would wipe out the June put players. June options expire on the 18th.

Mikey

Note: AAPL 249.06 was down today and closed below 250. This is a sell to me here. I think this one goes down even in a market rally. That also goes for all of the prior high flyers like BIDU CRM ESRX and CMG NFLX and DECK

Inflation?.. Well that's their story and they are sticking to it

Their story is a Lo whooo zer!!! Please look at the following

Commodity charts...See any inflation here? All of these charts start In May 2008. All I have hear for two years is we are going to have inflation. You Tell me is this inflation?

Corn ....How about the hungry world senario?



Wheat ....no not here




Copper...China hording copper? Nah



Platinum This is a semi precious metal Cracking?




Oil Remember 200 dollar oil and all those shortages..not working here



Dollar Index I thought they said the dollar was going to go down..remember the FED printing all that money? Well are they??



CRB Index An index of all commodities Looks down to me




They have touted inflation, recovery and commodities for the last 5 years. It is not working. The average person thinks we are going to have inflation. These charts tell the opposite story. That is the power of the media. I have been telling the deflation story for the past 3 years. The media does a good job of covering it up. Gold is the main cover. The public looks at gold and then draws a conclusion on inflation. If you control the price of gold you can control the public thought on inflation. As long as Gold stays up the public will believe there is inflation.

Notice the Bond market It is starting to trend up, This means that the long term rates are falling. They have been telling us rates are going higher..not true



Here are the world stock markets: No inflation here

India Just starting to get hit


Japan look out below


Emerging Markets ...Woops


Brazil.. Oh no Mr. Bill


US markets


And the Big Dog China




In summary, the dollar is going up, long term interest rates are falling, world markets are getting hit hard including our stock market and the commodities markets are heading south. Inflation that's is a bald face lie and prices are saying it.




Mikey

Experts put out Buy on AAPL 253.48.. Say that Gold is going to 7000

Ahead of Steve Jobs' keynote address at the Worldwide Developers Conference, a BGC analyst initiates Apple [AAPL 253.48 -2.485 (-0.97%) ] Monday with a 'Buy' rating and a $350 price target.

Analyst Colin Gillis tells Fast Money during a live interview that the iPad is an "untapped" platform for advertising and sees enormous potential in the electronic reader. He says the company has great products that people want and thinks an economic slowdown would affect Apple less than most. Gillis says Apple could almost be classified as "non-discretionary" spending and says that along with food, air and water, people need Internet connectivity.

Notice that they have a price target is 350. If you a short that will get your attention. Right.



Here is the same kind of thing that they are saying about Gold

Gold's 'Real Move' to $7,000 Coming: Asset Manager

The "real move" in gold is to come, predicted Egon von Gruyerz, founder of precious metals investment and storage company GoldSwitzerland.com, on Monday.


He told CNBC he sees the inflation-adjusted price of gold [XAU=X 1243.95 25.95 (+2.13%) ] "easily" rising to six times its current price ($1,210) to around $7,000 an ounce in the future on "normal" inflation.

"Adjusted for real inflation (as per shadowstats.com) the 1980 gold peak in today’s prices corresponds to around $7,200 today. So gold could easily go up 6 times from the current price of $1,220 and still be within normal parameters," von Gruyerz's latest report for GoldSwitzerland.com said.


"Gold is at this point not a bubble," he added. "It is not overbought."

An important barrier for gold is $1,220 an ounce and that barrier will be broken and it's "going to shoot up by probably $100 very quickly," von Gruyerz told CNBC.


If you are a short that will get you to cover 1220. I say 1220 is a fantastic short.

Notice that in both cases they are calling for a price much higher that it is now AFTER they have had a big move. That is common at this stage. I believe that these two are spectacular shorts in here.


Here is the chart on AAPL notice the MACD.



A break of 250 sends it down. God forbid, if the company missed their earnings one time by even .01 the stock is toast. I find the timing of this conference and this reco very interesting. The stock is right at its 50 and breakdown price and they tell you it it going to 350.

On Gold...
Von Gruyerz told CNBC gold could go higher if the world encounters hyperinflation. The fears stemming from the European debt crisis will enhance gold's safe haven appeal, according to von Gruyerz.

Gold.. Inflation???? Inflation??? Look at the commodities and the stock markets around the world. That is inflation??? I think this expert on Gold has his head up his ass, butt he has alot of company in there now.

Mikey

Jobs numbers Disappoint

DJIA 9938 -315.48 SPX 1066.52 Nasdaq 22240-78.86 VIX 35.30 +5.84 Gold 1215 +5.70 Silver 17.39 -.54 Copper 2.80 -.14 Oil 71.21 -3.40 RBOB(retail gas)1.9936 -.087 Nat Gas4.79 +.10 DBC (Commodities)21.28 -.64 EURO 1.1968 +.002Dollar Index 86.28 +1.07



The truth comes out the jobs report is bad. U.S. employers added 431,000 jobs to nonfarm payrolls in May, but 411,000 of those were temporary census workers. The private sector added just 41,000 jobs, well short of the more than 500,000 economists had expected. The unemployment rate, however, fell to 9.7 percent from 9.9percent in April.

Frankly, I was looking for a bounce into June expiration and that may still happen. This is what makes this game so hard if you trade. You know what the answer is 1 year from now but they can mess with with at any time. It is, however their game, and I can respect that.

They are turning up the heat on the longs now. Silver gaped down today and a close below $17 will be the the end of Mr. Happy face for the silver bugs. That and Gold are the only two commodities that have not broken down. The rest are just plain fat getting smoked. I think there inflation story is going to come into question and soon.

I will add to my ZSL on a silver close below 17 and my DZZ on a Gold close below 1170. Added to SRS 29.17 today and shorted SPG 82.56 and AEM 57.64. Looking to short AAPL below 250. I like AAPL short because they usually don't bottom the market until they waste AAPL. Gold is a great short because when it goes it will confirm the commodity hit which is well underway now. You know for every move at the end it must make perfect sense.

Mikey

Jobs numbers Friday..Expect big gains

DJIA 10228 -20.48 SPX 1098 +.10 Nasdaq 2241 2292.29 +11.19 VIX 30.09 -.08 Gold 1209 -13.50 Silver17.95 -.36 Oil 73.46 +.60 RBOB(retail gas)2.06 +.04 Nat Gas 4.648 +.22 DBC (Commodities)21.90 +.09 EURO 1.217 -.006 Dollar Index 87.25 +.37

It's that time again the jobs report. This one is going to tell us that the economy is picking up steam. The media is down playing those numbers today and the market is acting weak so I would not rule out some fireworks when the numbers are released. That would off the recent sell off and wipe out the puts.

Just like the auto numbers that were juiced by the government the jobs numbers will be juiced by the Census workers. Let's see the housing sales blew up because of the tax rebate. The auto sales blew up because of government fleet buys and now the jobs numbers will blow up because of Census workers. Now that is reality.

Mikey

Car Sales Explode...THANKS TO THE TAXPAYERS...Will GM get out of Bankruptcy?

Great News...Auto sales explode. Ford sales increased 22% GM sales increased 17% and Chrysler's increased SURGED 33%. Wow that's great but upon closer inspection fleet sales, lead by government purchases, increased 33%. That's right the government is cooking the books. Notice that consumers had a harder time finding deals this year but I guess the government did not.

These Bozo's are guying new cars for the government that really helps the economy, right? Well it helps the numbers which is what it is all about. The virtual is more important than the real. They say the outlook remains rosy for the summer. Ford is even ramping up production so that must mean that car sales are are going to keep going up. Well as long as the government keeps buying then Ford, GM, and Chrysler are Happy. The economists are happy the Congress is happy and the President is happy. Hey they are all going to be happy why not you?

The real truth is that the increases from a year ago are weak. A year ago sales were non exixtant.

Here is the article.

Drivers snapped up new models and rental-car companies and governments expanded their fleets in May, leading to big U.S. sales gains for most automakers. The exception was Toyota, whose tepid results showed that the company's discounts are losing their luster.

The industry's overall jump in sales shows that automakers are benefiting from a fragile but improving economy. Credit is thawing for cars loans and gas prices are stable. Consumers even shrugged off an 8 percent decline in the stock market last month. Ford [F 11.85 0.44 (+3.86%) ] will boost production through the fall, a sign that it thinks shoppers will keep buying.

Detroit automakers Ford, General Motors and Chrysler Group saw double-digit sales gains over the same month last year, when GM was headed into bankruptcy protection and Chrysler was already there.

Ford's sales rose 22 percent, boosted by strong demand for the F-Series pickup and new Ford Mustang. Sales to rental, government and commercial fleets rose 32 percent.

Ford said its inventories have fallen to a 48-day supply; a 60-day supply is the standard. U.S. sales analyst George Pipas said Ford is increasing second-quarter production by 15,000 vehicles to 640,000 cars and trucks. That would make second-quarter production 42 percent higher than a year ago. Ford also anticipates it will raise third-quarter production.

GM's sales rose 17 percent, led by a jump in sales of its four remaining brands—Chevrolet, Buick, GMC and Cadillac. Those brands got a lift from strong new products, such as the Chevrolet Equinox midsize crossover, Chevrolet Camaro muscle car, and Buick LaCrosse sedan.

Fleet sales spiked to 38 percent of GM's sales. Those sales can hurt resale values and brand image, but the company said it expects to end the year with 25 percent of its sales to fleets. Ford said it will end the year with about 30 percent of its sales to fleets.

Chrysler sales surged 33 percent in May, marking the first month in more than two years it sold more than 100,000 vehicles. Strong sales of its Jeep Wrangler, pickup trucks and minivans helped to drive the increase.

Consumers Struggle to Find Deals

Consumers found that deals were slightly worse than in April. The average industry incentive was $2,603 per vehicle last month, down from $2,631 in April and $2,943 in May of last year, according to auto information company Edmunds.com. Toyota spent $2,169 per vehicle, $160 less than in April.

Incentives are lower than in previous years because deep production cuts have left dealers with lean lots, making them less eager to cut prices, said Jesse Toprak, vice president of industry trends and analysis at auto pricing site TrueCar.com.

The outlook for auto sales through the summer appears rosy—provided the economy cooperates.

The financial markets need to stabilize and employers need to start hiring at a faster clip for sales to continue climbing, said Paul Ballew, a former chief economist at GM who is now chief economist at insurance firm Nationwide. "Big-ticket items get impacted by a choppy recovery," he said.

But several trends bode well for new car sales. Prices for used cars have been rising, which means consumers on the fence between a used and new car are more likely to buy new, Taylor said.

In addition, gas prices remain steady, home prices have started to stabilize and consumers are becoming more eager to replace their aging vehicles. "That free fall of home equity that consumers were looking at has stopped in most markets across the country, and that's important," he said.

The former economist at GM (give me a break)says Car sales are going in the The financial markets need to stabilize and employers need to start hiring at a faster clip for sales to continue climbing. Let me take a real long shot guess and say that the Jobs numbers are going to be great Friday. That will tie the bow on this thing. Let's change this story to a feel good love in now and bring in Mr. Smiley face to kick the puts butt.

The government is orchestrating this whole false recovery. The bought the banks stocks and then allowed then to trade their way to profits using taxpayer money and then sold the stock for a profit. They bought GM and are now pumping up their sales and will, bring them public and turn a profit on them. Where is the profit going for the money made on these trades???


Mikey