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Michael Clark
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Michael J. Clark was born and raised in Sinclair, Wyoming. He is a poet, novelist, artist, historian, and market analyst. His fine arts portfolio can be found at the following address: His writing portfolio can be found at:... More
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    Nov 14, 2012 7:29 AM

    . 14 November 2012

    My last post stressed the weakness of Canadian banks and suggested that Canada (and Europe) was going to join the American selling party. Today, I 'm suggesting Australian banks are vulnerable here -- and I'm also suggesting (just suggesting) that the housing bubbles in both countries are going to pop. Both country's have historical Debt Bubbles generated by low interest rates (too low for too long) and by housing bubbles.

    I don't intend this blog to be about the Canadian/Australian housing bubbles -- and the effects on banks in a declining economy. But both countries have historic housing bubbles, both much more overbought and excessive than the US housing bubble. I will visit this issue some other time.

    Today I want to show a relatively new indicator I am using to screen stocks -- its my CGTS Differential Weekly Moving indicator; and this indicator gave us this screen today. We look at the top and the bottom 25 using this screen. And what we see is that the top 25 have an amazing similarity: they are almost all inverse ETFs, that profit when stocks fall.

    We have charts of some of the top 25; and we have charts of the bottom 25, emphasizing our theme for the night: Australian banks seem to be topping; and US housing stock are starting to break apart, one by one.

    We see gold stocks valiantly trying to resists selling; US TBonds are hot again; the US Dollar is gaining strength by the day -- all signs that the selling in the markets is getting stronger.

    TOP 25 CGTS Diff WEEK  
    1IMMR5Immersion Robotics 
    2TZA5Direxion Daily Small Cap Bear 
    3TSU5TIM Part (Tele Cellular) 
    4PSQ5Short QQQ Index ETF 
    5TWM5Short Russell 2000 Index ETF Daily 
    6SBB5Short Small Cap 600 S&P ETF Daily 
    7QID5Short NASDAQ Index ETF 
    8RWM5Short Russell 200 Index ETF Daily 
    9EWV5Short MSCI Japan ETF Daily 
    10EPV5Short MSCI Europe ETF 
    11REW5Short Technology ETW Daily 
    12BZQ5Short Brazil Shares ETF 
    13IEF57-10 Year TBond Fund 
    14TIP5Barclay's TIPS Bond 
    15SMN4Short Basic Materials 
    16MUB4I-Shares Muni Bond Index 
    17SDP4Short utilities ETF Daily 
    18EFZ4Short MSCI EAPE Index ETF Daily 
    19YHOO3Yahoo Inc. 
    20IRWD3Ironwood Phama 
    21HURN3Huron Consulting 
    23VXX3VIX ETF 
    24SDD3Short Small Cap Index ETF Daily 
    25SIJ3Short Industrials ETF Daily 
    BOTTOM 25    
    25VPHM-5ViroPharma Inc 
    24TXT-5Textron Corp 
    23ARUN-5Aruba Networks 
    22NFX-5Newfield Explorations 
    21TYO-5Short 10-Year TBond ETF 
    20CA-5Computer Associates 
    19ANZ.AX-5Australia/New Zealand Banking 
    18BZF-5Brazilian Real long currency 
    17CUT-5Lumber ETF 
    16NAB.AX-5National Bank of Australia 
    15EUFN-5Euorpean Financial Index 
    14BBD-5Banco Brandesco SA 
    13HPQ-5Hewlett Packard Daily 
    12EWM-5Malaysia Index ETF 
    11SFL-5Ship Finance Intl. 
    10RVBD-5Riverbed Technologies 
    9CSCO-5Cisco Systems Daily 
    8MAKO-5Mako Surgical Corp 
    6EWJ-5Japan Index ETF 
    5SAN-5Banco Santander 
    4BBVA-5Banco Bilbao Argent SA 
    3IO-5Ion corp 
    2BYD-5Boyd Gaming 
    1^TNX-510-Year CBOE Interest Rate 

    Top 25

    Let me reiterate: the indicator in use for tonight's report is the very light yellow indicator appearing in the pane second from the top. Usually, when it spikes up, it indicates a buying opportunity.

    IMMR, Immersion Robotics, looks very strong at the moment. But remember, the direction of the markets is DOWN; so any counter-movement stock needs to be watched carefully.

    TSU is giving a buy signal through the CGTS 5-Day Differential -- but it has not really moved much yet. Everything seems in place for a good move up.

    QID, the inverse Nasdaq ETF, is the strongest of the three issues here overall. The picture of QID should be enough to encourage bulls who are holding on that this is no ordinary selling in the making.

    (click to enlarge)

    (click to enlarge)

    (click to enlarge)

    Bottom 25

    Here come the Aussie banks and one US housing stock that we really feel are all three ready for new short positions.

    NAB, National Australian Bank: Short.

    ANZ, Australia/NewZealand Bank: Short.

    BZH, Beazer Homes: Short.

    All three issues are showing accelerated selling and all are breaking down through support and trend levels. A careful examination of all three panes will show our technical logic for assuming these issues are breaking down.

    (click to enlarge)

    (click to enlarge)

    (click to enlarge)

    Need to run. Best of luck with trading.

    Michael J. Clark

    CGTS, Hanoi, Vietnam

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Comments (2)
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  • Tack
    , contributor
    Comments (14399) | Send Message
    A little late for BZH, don't you think? It just had a 17% panic sell-off on Monday, occasioned by somewhat of an overreaction to its one-time loss on a debt extinguishment. The company beat on both revenues and earnings, absent that loss on debt.
    14 Nov 2012, 08:19 AM Reply Like
  • Michael Clark
    , contributor
    Comments (9717) | Send Message
    Author’s reply » Wish I would have traded my gut-feeling a couple weeks ago.


    We'll see if support at 10.90 can hold. I think it may not. If 10.90 doesn't hold, then it has support at about 7.


    I think the housing stocks are all overbought.
    14 Nov 2012, 09:37 AM Reply Like
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