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Robert Edwards
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Contrarian daytrading technician who specializes in locating high probability short term trades while predicting price movement directions with over 85% accuracy. Most of my trading involves either extremely short term micro scalping of stocks or commodities (using 1 minute bar charts), or swing... More
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  • IAMGOLD (IAG) Has Bottomed Just Like I Called It So BUY NOW!!!!!

    Back on July 24, 2015, when IAG had just closed at $1.22, I wrote an article, click here, where I called IAG a fire sale you did not want to miss! Well, just look at the daily chart since then:

    (click to enlarge)

    After calling for a bottom at $1.22 (which happened to be the lowest close ever in the stock both in the past and likely in the future), the next morning we retested the flash crash low of $1.15 as I had predicted (in WeChat trading room) would be required, before rallying. We have only since gone straight up for the past 6 trading days, hitting $1.61 on Friday.

    Anything under $1.80 in IAG is still a fire sale, and you do not want to miss the opportunity to score big in this stock. The above chart shows what happened the last time IAG bottomed at $1.42 in November 2014. We paused briefly under $2, only to surge to $2.50 in just 9 trading days off the bottom. After consolidating for 2 weeks, we popped to $2.82 and ultimately to $3.39. The move from $1.42 to $3.39 took about 11 weeks.

    Now that IAG has bottomed at $1.15 and shot back to hit $1.61, it would appear that the bottom is in, and with the MACD buy signal, we can expect similar moves like we saw last November. So that means, one can expect to see a rally towards the $2.80 to $2.85 area shortly where IAG could pause. Then after falling back to maybe $1.50, expect a second surge towards the $2.20 level. From there, we could fall back to the $1.85 level before moving up towards the $2.50 to $2.75 level, where we will probably face significant resistance.

    Earnings are coming out after the close on Wednesday, August 5, 2015. That could cause IAG to slip back down a few cents, and give those who missed the bottom, another chance to buy. Many of you already missed the $1.15 bottom and it is doubtful you will get another chance to buy much under $1.30 ever again. You may not want to squander your chances to get involved in a stock with the ability to double or triple in value in less than 3 months.

    To follow along as we buy IAG as well as GLD, GDX, KGC or other mining stocks or Gold futures, or trade crude oil (UWTI and DWTI), natural gas (UGAZ and DGAZ) and other commodities, join us in our private Short Bull Trading Room on WeChat. Just download the free app on your phone or tablet, and then add "bobed1". You can then send me a message so I can invite you into the room. Still plenty of room.

    You can also subscribe to my free weekly newsletter. Send an email to shortbull2020@yahoo.com if interested in subscribing. Again, it is free!

    Disclaimer:

    The thoughts and opinions in this article, along with all STOCKTALK posts made by Robert Edwards, are my own. I am merely giving my interpretation of market moves as I see them. I am sharing what I am doing in my own trading. Sometimes I am correct, while other times I am wrong. They are not trading recommendations, but just another opinion that one may consider as one does their own due diligence.

    Tags: IAG
    Aug 01 6:52 PM | Link | Comment!
  • Short Term Price Projections For Gold (GLD) And Crude Oil (UWTI)

    December Gold

    The above daily chart of December Gold futures shows stability above $1080, despite seeing only a couple up closes in the past 16 trading days, and a current drop of 3 days in a row. Until we get a rally to "undo" the current severely oversold condition, further drops should be limited. There is better than a 50/50 chance that we will hold support in the $1065 to $1072 level for now, and should get a rally soon of $80 or more. If we should break lower, it should be a bear trap, and I do not see a drop below $1050 for now. Until we see a move back above $1100, scalping from the long side should be quite profitable if playing the gold futures or GLD.

    I won't post charts of the gold miners or GDX or GDXJ, at they are too depressing, but I do believe that buying IAMGOLD (NYSE:IAG) and Kinross Gold Corp (NYSE:KGC) should do fine if one patiently holds for the next gold rally. The triple leveraged ETFS (NUGT and JNUG) are absolutely toxic and cannot be safely purchased until gold establishes a bottom which it has not yet done.

    September Crude Oil

    Finally September Crude Oil Futures prices have stabilized at the $47 per barrel level. After two up days off the lows, today we saw some profit-taking. However, on near-term dips and possible retest of the lows, expect the bottom to hold. For those not long, buying UWTI when crude oil is trading between $47.60 to $48.50 should work out well. Here is a daily chart of the triple leveraged ETN (NYSEARCA:UWTI):

    (click to enlarge)

    The MACD is giving a buy signal in UWTI, as shown in the above chart. With a rally back towards $54 in crude oil, UWTI should return to prices above $2.20. Despite all the negativity in the media it will not be easy to keep crude oil below $50, let alone $40 or anything lower. Unlike worthless paper gold which has become less prized than a pet rock, crude oil has real intrinsic value due to the fact it remains an indispensable primary energy source, so it should not drop any lower in price than is absolutely necessary. It has taken perfect alignment of the stars to get crude oil back under $50 and we should not remain trading in the $40s for long. Relief for beleaguered bulls should be shortcoming.

    To follow along as we buy IAG as well as GLD, GDX, KGC or other mining stocks or Gold futures, or trade crude oil (UWTI and DWTI), natural gas (UGAZ and DGAZ) and other commodities, join us in our private Short Bull Trading Room on WeChat. Just download the free app on your phone or tablet, and then add "bobed1". You can then send me a message so I can invite you into the room. Still plenty of room.

    You can also subscribe to my free weekly newsletter. Send an email to shortbull2020@yahoo.com if interested in subscribing. Again, it is free!

    Disclaimer:

    The thoughts and opinions in this article, along with all STOCKTALK posts made by Robert Edwards, are my own. I am merely giving my interpretation of market moves as I see them. I am sharing what I am doing in my own trading. Sometimes I am correct, while other times I am wrong. They are not trading recommendations, but just another opinion that one may consider as one does their own due diligence.

    Tags: GLD, UWTI
    Jul 31 3:33 AM | Link | 2 Comments
  • Down Over 18% In Two Days, Freeport-McMoRan, Inc.(FCX) Is Getting Washed Out

    Why FCX?

    Freeport-McMoRan Inc. (NYSE:FCX) has fallen 18.5% in the last two days, ending Friday at $12.29. It is starting to look very cheap. I am not saying you should rush in to buy the stock when it opens on Monday, but if you could pick up shares closer to the $10 level, you should be able to make a very profitable quick trade in the stock.

    I have a bit of nostalgic fondness for this stock as it used to be one of my favorite day-trading vehicles. Also I rode the stock down from the $20s, to a low of $7.87, back in 2008, and back up to the $20s and beyond. My patience was rewarded.

    Those buying at current rock bottom prices should on a long-term basis, also be rewarded when the prices of copper, gold and crude oil improve. However, my current interest in the company is only for a quick scalp, a mere trade. I am looking for a very oversold bounce to occur, once the price stabilizes.

    FCX reported earnings on Thursday and the stock has been killed for two days, as reported here. Earlier this year, Morgan Stanley was actually encouraged about the company's prospects and upgraded the stock in April. The bottoming of crude oil helped, along with stability in gold and copper prices. However, now all three markets have weakened and FCX stock has plunged. Here is a five year weekly chart:

    (click to enlarge)

    You will notice how the FCX stock price traded between $25 and $40 from late 2011 to late 2014. However, because FCX decided to diversify into the oil and gas arena instead of sticking with their copper & gold mining interests, they suffered with the drop in crude oil prices. The last major high occurred at $37.67 back in July 2014. FCX finished out 2014 at $22.76. In less than a month, FCX would fall to a low of $16.23. Then in February, a high of $21.63 was reached. Then came a March 2015 bottom at $16.81. During April and May, thanks to a rally in crude oil, FCX was able to finally get back to $22.74, about where FCX started the year. It appeared that FCX had found a new trading range between $16 and $23. But closing below support on Friday, July 20, 2015 at $15.88, was a bad omen. This past week the stock has been obliterated, hitting a low on Friday of just $12.17.

    To understand where FCX might again find support, we can look to see how FCX traded during the last hard smackdown back in 2008: Here is a weekly FCX chart going back to that time period:

    (click to enlarge)

    From a May 2008 high of $50.30, FCX fell during the financial crisis to a low of $6.31 (adjusting for dividends). You will notice how initially $10 held support and the stock traded between $10 and $13 for 4 weeks. I expect to see FCX do something similar should it again fall to $10. Then in November 2008, FCX plunged the next week to a low of $6.95, only to hit $10.30 the next week. Finally the major low was hit the following week at $6.31, the first week of December 2008. Just a week later we saw $10.14, and after 4 more weeks FCX hit $12.50. It is not shown on the chart, but by June 2009, just 6 months after bottoming, FCX hit $24.68. By January 2010, FCX hit above $36, and that started the trading range of $25 to $40 that FCX would remain in until recently.

    As we trade below $12, I now expect to see FCX struggle to find support somewhere between $10 and $11. When FCX fell from $37.67 to $16.23, that is a drop of 57%. From the recent high of $22.74, a drop of 57% would project a new low of $9.80. Thus the $10 area should be a good target price to buy FCX.

    Once FCX does bottom, expect it to trade in a range for 3 to 4 weeks. However, the ultimate low could be a plunge to $8, $7, or maybe $6, but I would expect to see a quick rally back to $10 within a week or so, with every plunge. Since $16 was recent support, it will likely become future resistance, and that is the long-term price level one should target, if crude oil, copper and gold should finally stabilize and rally out of their present holes.

    Summary:

    Scale trading in on FCX as it approaches $10 should work out well, as the company is extremely oversold and could bounce.

    On an operational basis the company does still earn a profit, but is forced to take big write offs based on lower valuations of its assets. In recovery, the appreciation of these assets should help bolster prices, just as they now are a drag. If copper, gold and crude oil prices remain at current rock bottom prices, FCX will have to take further write-offs which could plunge the stock below $10. However, somewhere around $6 to $8, there should be some real value discovered. The stock has a book value of over $13, and a forward PE of just under 7. The company plans to spin off the oil company interests which should improve the balance sheet and remove the drag of low crude oil prices. In any case, FCX has positive cash flow and can weather the storms for several more years. Just as FCX rallied from $16 earlier this year, I expect it will begin a rally around $10 in the short term with maybe some quick spikes lower.

    Disclaimer:

    The thoughts and opinions in this article, along with all STOCKTALK posts made by Robert Edwards, are my own. I am merely giving my interpretation of market moves as I see them. I am sharing what I am doing in my own trading. Sometimes I am correct, while other times I am wrong. They are not trading recommendations, but just another opinion that one may consider as one does their own due diligence.

    Tags: FCX
    Jul 26 3:51 AM | Link | Comment!
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