Market Movers

I am not seeing a lot of good money making opportunities on the long or short side right now. I moved some money into my Paypal account, which is yielding 4.73%. The September $50 Calls on UNH looking tempting. On the short side Superior Essex (SPSX) looks like a decent short except the downside volume has been minimal.

Note: Please do your own due diligence before making a trade.

Bounce

Markets saw a nice bounce today. I still have cash on the sidelines. The commodities will lead this market higher.

India Gets Knocked Out

I have a few friends that live in India and follow the Indian economy pretty closely. One of my relatives also owned the India Fund (IFN). IFN is a close ended mutual fund.
One ugly chart the past couple of weeks. One of my friends rode this from $30 to $50. Luckily he got out. The downside volume in May is troubling. Also see EEM.

My 2 cents, IFN & TIE along with a few other high fliers look like charts from March of 2000. I will never forget when my macroeconomics professor said, "rich people love bear markets."

Silver Wheaton (NYSE: SLW)

I added some Silver Wheaton (SLW) today. The stock is oversold and the valuation is reasonable. This is my long term silver play. I am going to make a move on FCX closer to $52 or $53.

Freeport McMoran (FCX)

Since I am still a novice at technical analysis I asked Mike to take a look at Freeport McMoran (FCX). I will probably take a stab at a few shares on Monday. If not, I will buy some long term call options.

Mike is one of the most respected traders/bloggers on the net. He is one of the few people that I have conversed with that has actually made me a better trader (find money making trades as well as capital preserving trades).

Subscribe to Trader Mike's Blog Here (Free)

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Mastercard IPO (NYSE: MA)

One of the reasons why I am recommending trying to get into the Mastercard IPO is not just the brand name but the business model. Mastercard basically runs an oligopoly with Visa on credit card facilitation services. Oligopoly spells fat profits.


61,520,912 Shares From Issuer (Class A)
Lead Underwriter: Goldman Sachs & Co.
Price Range: $40.00 - 43.00

Dividend Policy: Expects to pay a quarterly dividend of $0.09 per Class A or Class B Share.
Use of proceeds: "...increase our capital, defend ourselves against legal and regulatory challenges, expand our role in targeted geographies and higher growth segments of the global payments industry and for other general corporate purposes" (Source: Mastercard Prospectus p.38)
$650 million will be used to repay current Class B shareholders.

Net Operating Fees for Q1: $495M (2006) vs. $412M (2005) (p.44)
Expenses For Q1: $348M (2006) vs. $307M (2005) (p.46)
Total Liability for US Merchant Lawsuit & Other Legal Settlements: $615M
Net Income: $267M (2005) vs. $238M (2004) (p.52)

Have fun reading the 250 page prospectus.

Back Up The Truck On Gold Stocks

I feel like Cramer right now. I want to back up the truck on gold stocks. Right here, right now. My top names are Goldcorp (GG) and Freeport McMoran (FCX). My silver play is Silver Wheaton (SLW). All three of these stocks have gotten whacked the past week. Now is the time to buy. I normally would like to buy strength but this is an exception. I am already long Silver Wheaton (SLW). I am going to add either Goldcorp (GG) or Freeport McMoran (FCX) to my portfolio next week. With FCX you get a fat 2.2% dividend at these levels plus copper exposure.

Stock Market Update

Rough day for the markets again today. As I have said before, I have be doing some selling the past couple of weeks. Instead of going short the market, I am keeping some cash on the sidelines.

Google (GOOG) and Broadcom (BRCM) are showing some nice relative strength despite the down day. Keep an eye on those two names the next couple of days.

3-Bagger

I sold my entire position in Titanium Metals (TIE) this morning for a nice 300% gain. I mentioned that I will be increasing my cash position. This is my second stock sale in two days. I can't watch a nice gain slowly evaporate like what I am doing with Broadcom (BRCM). I will revisit Titanium Metals below $60.

Goodbye Gilead (GILD)

I sold my position in Gilead Sciences (GILD) today. I will be increasing my cash position. I didn't like any of the action at all today. I am also looking to sell my positions in Broadcom (BRCM) on any bounce and Titanium Metals (TIE) on any further strength. Check out Trader Mike's charts for analysis on the S&P.

As far as my watch list, PTRY broke down technically today. NIHD still looks like a decent long on one more day of down action.

Portfolio Changes Coming

I am about ready to take my money and run out of Broadcom (BRCM) and Gilead (GILD). Stocks on my watch list include Commercial Metals (CMC), Universal Stainless & Alloy Projects (USAP), NII Holdings (NIHD), Focus Media (FMCN), and The Pantry (PTRY).

Keep An Eye On Canada

I have posted about this before but I will say it again. I would be betting on the Canadian dollar to strengthen against the USD in 2006. I would not be surprised if one Canadian dollar can buy more than one USD come January 1, 2007. I am not a currency trader, but clearly the trend is continued strength in gold, copper, silver, and any currency except the USD. You might want to consider converting your dollars to buy international stocks instead of buy the ADR.

IBD Free Access & Commodity News

IBD is giving free access to its "Daily Graphs Online" from May 8th through the 10th. Registration is not required to access the charts.

A Gold Mining ETF is in the works.

Buffett Sells His Silver

Business Readings

Good session for the bulls today. Here are a few interesting articles...

Bolivia: No plans to nationalize US-run silver mines

Soda Distributors to End Most School Sales

US awards $1 billion for cell-based flu vaccines

Microsoft to acquire in-game advertising pioneer Massive Inc.

Portfolio Update

Here is how the portfolio looks as of 5/4/06.
YTD Return: 18.7%
(Includes Dividends and Commissions)

Top 10 Holdings (% of Portfolio)
1. Titanium Metal (TIE) 13.4%
2. Broadcom (BRCM) 11.2%
3. Bema Gold (BGO) 10.3%
4. Etrade (ET) 9.1%
5. Cerner (CERN) 8.7%
6. Chesapeake Energy (CHK) 7.7%
7. Silver Wheaton (SLW) 7.7%
8. Banco Bradesco (BBD) 7.0%
9. Citigroup (C) 5.3%
10. Altria (MO) 5.3%
Other 14.3%
Short: None

Best Holding YTD Return: Titanium Metals (Up 134.75%)
Worst Holding YTD Return: Cerner Corp. (Down -11.37%)
Most Recent Transaction (3/29/06): Sold Position in New River Pharma (NRPH)

Silver Continues Rise, Stocks Lag

The Silver ETF (SLV) is up 10% in three days while the silver stocks SLW, SSRI, SIL, & CDE have lagged.

If you have seen the price of silver lately it has been hitting new highs everyday. The interesting thing is that silver stocks are now lagging the price of silver. Just something I thought I would point out. Many of the stocks have had big runs in the past year plus you are seeing some multiple contraction.

Note: I am long SLW

Watch Out Google!

Amazon.com (AMZN) announced today that they would switch from Google based technology for its A9.com to Microsoft Live. Google is still the Bentley of online search but Microsoft is now the 300M.

The search technology looks a lot like Google. Plus I'm listed right below Super Bowl Champ Ben Roethlisberger (br-7.com). What's not to like?