Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
CATHY WOOD ARK GARBAGE ARK Funds Heading for 90% STOCK CRASH! - 22nd Jan 22
Gold Is the Belle of the Ball. Will Its Dance Turn Bearish? - 22nd Jan 22
Best Neighborhoods to Buy Real Estate in San Diego - 22nd Jan 22
Stock Market January PANIC AI Tech Stocks Buying Opp - Trend Forecast 2022 - 21st Jan 21
How to Get Rich in the MetaVerse - 20th Jan 21
Should you Buy Payment Disruptor Stocks in 2022? - 20th Jan 21
2022 the Year of Smart devices, Electric Vehicles, and AI Startups - 20th Jan 21
Oil Markets More Animated by Geopolitics, Supply, and Demand - 20th Jan 21
WARNING - AI STOCK MARKET CRASH / BEAR SWITCH TRIGGERED! - 19th Jan 22
Fake It Till You Make It: Will Silver’s Motto Work on Gold? - 19th Jan 22
Crude Oil Smashing Stocks - 19th Jan 22
US Stagflation: The Global Risk of 2022 - 19th Jan 22
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
NVIDIA THE KING OF THE METAVERSE! - 10th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
MATTERPORT (MTTR) - DIGITIZING THE REAL WORLD - METAVERSE INVESTING 2022 - 7th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
METAVERSE - NEW LIFE FOR SONY AGEING GAMING GIANT? - 6th Jan 2022
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Three Macro Investment Plays – CYB,TBT,YCS

Stock-Markets / Investing 2010 Oct 31, 2010 - 03:39 PM GMT

By: Peter_Navarro

Stock-Markets

The market remains in an uptrend but it is a “weak dollar” rally, not a “strong economy” rally. In real, dollar-adjusted terms, the market is closer to flat. A possible crash triggered by the weakening economy or a currency war is not out of the question. Don’t fight the trend – but I’m certainly not jumping in on the long side with both feet either.


China’s recent interest rate hike and Fed Chief Ben Bernanke’s recent QE2 interest rate cut put us on a collision course. You simply can't have one country lowering interest rates in another country raising interest rates when the two currencies are held together by a fixed peg. Something has to give, and I think perhaps that Ben Bernanke is trying to force the Chinese to revalue the yuan because the Fed chairman knows that the White House and Congress don't have the backbone to do it – and the Fed chairman also knows that reducing the global imbalances between China and the US is critical to long-term recovery.

From an investor's point of view, I see three related macroplays: Long the yuan via CYB, short the long bond via TBT, and short the Japanese yen, YCS. (I have all three positions)

The yuan MUST eventually rise and can’t go down so CYB is very low risk. Once the yuan starts to rise, long bond yields must rise because the Chinese. Buying as many treasuries as they do now. This will cause a spike in TBT. The yen is grossly over-valued because the yuan is grossly undervalued – it must fall once the yuan starts to rise.

I continue to allocate 20% or more of my portfolio to small cap, discovery stage biotechs outside the cycle. I said to get into SVNT prior to an FDA ruling that would lead to a 75% pop. I said to sell SV is NT after the pop because it might be hard to get a buyer for the company. Now that SVNT has fallen dramatically because of a failure to find a buyer, I think it is a buy again and has at least a 25% upside. (I bought on drop).

Right now, my favorite little penny play and best performer is Stellar Biotech (SBOTF) – it has almost doubled since I first noted it in the newsletter. (Check my previous newsletters for more detail.) I've also begun to build a position in Direct TV as a long term secular play as satellites spring up all over.

My other highly risky penny play that is making a very nice move on low volume is LPTN. If it breaches a buck, it should start to run nicely.

Since I got into the rare earth bonanza a bit late, my small positions in several stocks are flat to down; but I'm not really worried because this is a long-term building project. So far, I have opened small positions in ARAFF, GDLNF,GWMGF, and LYSCF. Only GWMGF is up. (As previously noted, I purposely stayed away from Molycorp as it is way too expensive.)

I sold Hovanian for a small loss and reloaded with Beazer, which has better technicals – so that's my play on the housing sector, which I think is at a bottom.

I dumped him my shares in DUSA, MDVN, and TEVA not because I have lost faith in it but simply because I wanted to deploy my cash elsewhere and I didn't see much upside in the near-term.

I also closed my position in QTWW on news that it was going to undergo a reverse stock split. I just hate that crap, and reverse stock splits invariably reduce a stock’s price.

I closed my short position in GameStop with a very nice little profit -- with the market trend robustly up, just don't want to be short now.
I also opened a position in a penny stock called Converted Organics (COIN). It's got excellent technicals and came up on my Market Edge screen. It's a good long-term play on agriculture.

Stocks that I am long: ARAFF,BZH,COIN,CYB,DTV,DUSA,FEED,GTXO,GWMGF,GDLNF,LPTN,LYSCF,NRGX,SVMI,SNT,
SBOTF,SVNT,TBT,YCS

Navarro on TheStreet.com

Click here to review my videos on TheStreet.com.
———-

Professor Navarro’s articles have appeared in a wide range of publications, from Business Week, the Los Angeles Times, New York Times and Wall Street Journal to the Harvard Business Review, the MIT Sloan Management Review, and the Journal of Business. His free weekly newsletter is published at www.PeterNavarro.com.

© 2010 Copyright Peter Navarro - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in