Birchtree's Account Talk

[Birchtree]

Re: Birchtree's account talk

From my friends at MLPF&S,Inc.

As we see it, new recovery highs on the DJIA and S&P 500 are unlikely to be confirmed by similar new highs on most technical indicators - such as advance-decline statistics, new 52 week highs, volume, or momentum. As a result, it does not seem to be unreasonable to suggest that, even if some of the market averages make new highs, most individual stocks have probably already reached their highs for the year and have begun their own cyclical declines. Our approach, therefore, is unchanged: we believe that rallies (including the current one) are opportunities to become defensive and/or to raise some cash in anticipation of renewed weakness in the months ahead.

The Birchtree doesn't believe a blessed word of this nonsense - be right and sit tight. Snort.

 

[Birchtree]

Re: Birchtree's account talk

We have new all-time highs on the NYAD again - currently looking for another thrust move to put us into a higher orbit, but until the bottoms above bottoms structure is violated price will continue to move higher overall. So overall, things are looking mighty fine right now for a continuation of the uptrend that started in 2002. The NYSE breadth MSCUM has now moved above +500 level.

Oil prices holding back SPX today - but individual stocks are rocking just under the surface. Light my fire. The gains on the NYSE should portend bullish sentiment into 2008. Did I really say that? Birchtree you should be more careful - the bears are still lurking with their claws.

 

[Birchtree]

Re: Birchtree's account talk

If we make new all time high on the ratio adjusted NYAD during this current sequence the sky is the limit.

 

[Birchtree]

Re: Birchtree's account talk

The NYAD (Daily) cumulative at 147654 is a new all time high. The NYSE AD composite continues to make new highs after breaking out the week ending August 4, 2006. The weekly NYSE AD composite MCO has achieved its highest posting since December 2004, making a clean break of its controlling long term resistance. A nice strong pattern coming off the June lows, and further upside momentum in the longer term would generate a bonafide initiation thrust signal. The composite weekly AD MCO is currently at +43, enough for decisive resistance break out. A move above +50 in the coming weeks would spark an initiation thrust. Snort.

 

[Birchtree]

Re: Birchtree's account talk

I got some more bull manure to shovel before the weekend is up. Consumer spending in the U.S. rose 0.8 percent last month, the most since January. The rise in spending followed a 0.4 percent June increase. Incomes were up 7.1 percent from the same month last year. Disposable income was up 6 percent in the last 12 months. My pockets are a wee fuller, too.

Consumer spending is dominant in the economy as a whole to such an extent that it is, by itself, the sector that cyclically determines the direction of the overall economt. This being the case, carefully monitoring overall consumer spending - or even more significantly, forecasting the direction of consumer demand - is the key that unlocks effective forecasting for most other developments and sectors in the economy. The 2000 bear market began as the rate of growth in consumer spending peaked and began to slow. Spending so far is holding and I am too. Snort all the way to DJIA of 11,722.98.

 

[Birchtree]

Re: Birchtree's account talk

As in the 1994-95 experience the Treasury - bill appears to have unlinked with the Fed funds rate. Following the same pattern as it did in 1995 as the market was about to lift-off into a 50% gain in the next 15 months, and 165% over the next four years. I like it...will be buying tomorrow no matter the flavor of the market. The Oceanic has now penetrated the $1M again and I'm presently 11 points shy on the Tugboat for my yearly $1.00 gain in the C fund.

 

[Birchtree]

Re: Birchtree's account talk

I just completed the purchase of 34 individual stocks and my stomach is tight - but I know this is the right thing to do. And I've got more todo tomorrow. I looked back at the buys on the June/July bottoms and most are higher now, so the direction is correct.
But it is never easy in the face of adversity. Snort. Waiting for Godot.

 

[ocean]

Re: Birchtree's account talk

Birch,

How can you compile 34 individual stocks to buy in one day and some more tomorrow in addition to your oceanic portfolio. With that many stocks on hand, you can run your own mutual fund company. Let me guess, it is Birchtree funds.

Ocean

 

[Birchtree]

Re: Birchtree's account talk

Ocean,

A good percentage of those wall flowers were DCA additions to my current holdings - getting ready for the next bull run. I have another 17 lined up perhaps for tomorrow - and a plethora of dividend reinvestments due in the middle of the month. So if September is tough at least I'm doing the DCA on the lows. I actually have 300 free trades available to me before the end of the year - then the clock starts again with another 400 free trades.
if the market goes up I make money, if it goes down I buy cheaper while giving some back. I sincerely believe a serious up move is in the making and if so....well I won't brag. You have to be in to win.

 

[ocean]

Re: Birchtree's account talk

Birch,

I was embarrassed to ask, what's DCA. (I've seen you mentioned it before). How could you get 300 - 400 free trades?

Ocean

 

[Birchtree]

Re: Birchtree's account talk

Ocean,

DCA = dollar cost average. The trades are based on the level of portfolio worth. $1M gives me that many trades. I pay a fee that is also portfolio based rather than commission based. It's actually a lot cheaper for me to do my buying this way. I have a tendency to build in smaller blocks and sell in larger blocks. It's dollar cost averaging on a larger scale - nothing to it. I have 87 more stocks that I will buy before the month is finished. And more CSX is on the list. I have a number of beauties that may leave the portfolio later in the year to be replaced by new wall flowers. All they need is a good application of sweet superlative bull manure and they grow into beauties. But every time a beauty leaves there are tax consequences and it's always a difficult sacrifice. Snort.

 

[ocean]

Re: Birchtree's account talk

Birch,

How can I not know what the DCA is. Huh!!!

As for your portfolio based, I would not have that kind of treatment because I don't have that type of portfolio outside of TSP. As for TSP, I am trying to build it to a $1M size, well .. may be in the next 10 years and I think it is achievable. But by then, I will live off from some of the proceed from the returns while I retire.

I can see dropping a few percentage points on the C fund would not even make a dent on your overall portfolio. Happy investing.

Ocean

 

[Birchtree]

Re: Birchtree's account talk

Ocean,

Make no mistake the opportunity is there - I'm still working my TSP for future gains and with the increased ceilings there will be many others that will follow but only they will achieve their goals even sooner. Every time I absorb a body blow by giving some back on a temporary basis my ribs hurt. The bear clawing me is part of being in the woods of investments. But now Goldilocks has arrived to save the day for a better future. Thank you Geroge Bush.

 

[Birchtree]

Re: Birchtree's account talk

I can't help it - just bought another 17 wall flowers and 1 dog. Looking forward to tomorrow to spend some more - hurt me, hurt me please.

 

[Birchtree]

Re: Birchtree's account talk

The pain feels so good I couldn't wait - just bought another 20 special wall flowers. And I'll more than likely pull down another bunch tomorrow.

 

[Birchtree]

Re: Birchtree's account talk

The Dow volume MCSUM is currently at a high level of +1342 and will keep the Dow from declining with any kind of vigor for a while. Large price declines just don't happen with the MCSUM this high. I need an intra day break to the downside so I can place some more buy orders in the morning. I'm simply trying to buy myself into happiness. Snort. And I got the ability to do it.

 

[Birchtree]

Re: Birchtree's account talk

The yield curve has completely inverted and that may be bad news for corporate profits. Since 1970, every yield-curve inversion has been followed by a full blown profits recession (the lead time has varied from six to 24 months; the average has been 15 months). This time around a profits recession could occur in mid to late 2007. The bottom line; earnings expectations for next year are probably too optimistic. That would interfere with the Dow approaching my target of 17,000 so I'll just have to keep an eye open without to much fear. No fear here at this point in the cycle.

 

[Show-me]

Re: Birchtree's account talk

Wow! I was beginning to think you never had a bearish thought cross your mind. Glad your not looking through rose color glasses.

 

[Birchtree]

Sweet Janet

Ms. Yellen argued that inflation is likely to come down in the coming year because of slower growth and flattening energy prices. In addition, she said that research at the San Francisco Fed has found that in the past decade inflation has shown a greater tendency to revert to its long-run average. That runs contrary to the conventional finding that inflation, once it rises or falls, has a strong tendency to persist at its new level.

"This evidence is important because, if it holds up, it implies that inflation may move down from its elevated level faster than many forecasters expect," Ms. Yellen said.

Now is the time to focus on the factors that will eventually force the Fed policy makers to ease. I try to position my portfolio to play many months out from now - and at the same time constantly looking back over my shoulder. The BULL in my opinion is prepared to stomp and close the trap on many complacent bears.

 

[Pill]

Re: Birchtree's account talk

Birch,

Thanks for your posts. I've have gotten allot from them. I am noticing some are haters. But I think its more out of being envious. Keep em comin....