speculative - AXPW.ob

If anyone follows anything about batteries, they know about John Petersen and his altenergystock.com blog. (really good info., started following him with his seeking alpha articles, but i prefer his older picture better:)

The man knows his stuff, and his persistence push of acid-lead batteries (aka AXPW.ob) has made me a follower of the name, despite my liking to lithium and SQM.

Today the stock is indicating a change in trend, and it looks to want to break from its multi-month downtrend. There could be a sizable spike in the name, and given its low level, I think it is worth the risk here.

Look how it is breaking from the 20 SMA, which has been consistently keeping the stock down. And in early Feb to present, there has been a stable consolidation. Could see 1.60 or even 2.00 if some positive info develops.

At the current state of the company, AXPW.ob is purely a trade.

FYI... my opinion is that SQM is the better investment, and AXPW.ob is purely speculative.

A word on AAPL

So much talk regarding AAPL last week. IMO, all because of Cramer. There is no way around it, the man has the Soap Box to move certain aspects of the market, especially individual names.

I completely agree with the man on AAPL, and since he provided the catalyst to its upward momentum, here is how I plan on playing it. (I was going to wait for the momentum to start then provide this post, but Cramer quickened the process.)

I do not plan on selling it until the weekly charts tells me to sell it. When the Red line of the Slow STO moves above 80 and lingers for a week or two, I will sell some.



AAPL is cheap (was cheaper before, but in relation to its growth still relatively cheap). And with Friday's move, IMO, it started its momentum upward. Despite being overbought, on the daily, its attractive valuation and breakout will allow it to keep rising, while consolidating its overbought position as it rises. (this can happen)



With this in mind, I will be day-trading it, buying Jan 2011 AAPL 210 calls on any downward move of the stock.

Market Thought... not chasing

The market is too overbought.


With the market move, and my new target prices for the stocks I am looking for, a market move to the 200 SMA maybe unrealistic right now.

Fundamentally I am a market Bull, and the market sold off harder than I thought it would Jan/Feb given the earning reports. Although I was expecting a consolidation in Jan, the market was completely detached from the fundamental story. If the market now starts acting normally with respect to earnings power fundamentals, the downward move to the 200 SMA will be postponed.

So I will most likely close out my market protection upon the current overbought consolidation, then stay heavy in cash and trade around the names of interest. Then utilize that cash when we get that solid downward move.

The piece of data that caught my eye on Friday was that Consumer Credit was improving. (video) This would mean normalized earnings power should be used to value banks. My favorite is JPM on a pull back. But the Volcker rule would seriously effect its overall biz, so a play not having the Volcker rule as a 'gray cloud' depressing valuation, WFC would be the purer play on the consumer credit improvement. I would wait for a consolidation from the overbought condition from both JPM and WFC. For WFC my entry would be 27-28. For JPM my entry would be 41.

Market Thought... bi-polar

Just a quick market thought...

We go from 'sell everything' to 'buy everything' in a matter of days. I do not like getting caught up in this 'buy, buy, buy' or 'sell, sell, sell' mentality. (I just like utilizing it when I see it.)

Right now we are in the 'buy, buy, buy' mentality. Cramer even hyped up AAPL the other day for that very reason. (Don't get me wrong, I would like to thank him, as I am in the name, but its dangerous, especially when we are in such an inconsistent market.)

Many individual names are very overbought now, and regardless of the technicals, anytime I get the feeling of this 'buy, buy, buy' mentality I get uneasy. Especially when it is paired with a low and very oversold Vix.

I have limit order triggers on my long positions. I sightly increased my put protection. If limit orders get executed, great. If the market reaches 1140-1150, the orders should be executed, and I will effectively be short the market. (At that level, in the current mini-rally, we will be too overbought, for me to be interested in staying long many names.)

New Targets

With the current market, I have to established new entry points for the names I want to go heavy in.

1. GOOG - 520 is definitely a floor. It may go to 530s with a declining market.

2. GS - around 157-158. (Some really nice action today.)

3. IBM - around 124. A case can be made that there is support here, but with a declining market a lower tide will lower all boats, and the 124 level is where the tide might take IBM.

4. Apple - This one is a bit tricky. I want to say the 204 level, but conservatively speaking its 200. (I will act on some at the 204 level.)

Market Thought... up a notch

With the SP500 rising, and media complacency setting in, if I was cautious before, that cautiousness is only increasing. As the markets rise, my long positions seems to be getting reduced and my protection is becoming a market short.

Here are some patterns I am paying attention too:

Within the Vix, this hump in the Slow Stoch (highlighted within the box) suggests over the next couple of days we may see a spike.


The next is the SP500/Vix overlay chart that I consistently have up here. But this time, its flashing red.

The interesting aspect of this chart is how the Vix acts. It first uses the horizontal blue line as support, then the horizontal dotted red, then back to the blue line. But notice it tends to overshoot the horizontal blue line (captured w/in the circles).

I still believe there are plenty of bargains out there (i.e. IBM), but I also can not ignore the technicals.

Senator Jim Bunning...

You epitomize what is wrong with the Senate. (article)