Taking Stock: That was a Retest

We finally had the retest, and it looks as though we will get another one, considering that we are at Dow 8000 and possibly dropping a little more.

The market, according to both Dan Fitzpatrick and Dr. Stephen Leeb, will probobly be stuck in a range for a couple more months until the stimulus packages and cash infusions work their way in to the economy, but I am not incredibly concerned about that because of the number of stocks that I have that are in an uptrend despite the somewhat stagnant, but volatile, market.

I noticed that Wells Fargo (WFC) gapped up, and now appears to be forming a flag pattern, which can be seen in the decreasing volume. Wells Fargo is quite possibly the only bank that did not need any cash infusions from the government, besides the money that they recieved for having acquired Wachovia. I think US Bancorp might be in a similar position also, but don't hold me to it.

I downloaded the conference call for CE Franklin last night, and they sound as though they are in a decen position. I need to look to see how much of their business is dependent on Canadian tar sands. Tar sands is expensive to extract & process, so it needs the price of oil to be at $80/bbl in order to be profitable. Other CAPEX (CAPital EXpenditures) have been being cut and/or reduced since the price of oil has been dropping. My understanding is that the CAPEX that has being cut is related to the places where it is expensive to produce oil for a profit, so those projects have been being cancelled. CE Franklin's Debt/Equity ratio is beautiful, coming in at 0.165. Their stock price is still below the book value also. I also noted in the conference call that they might make some more acquisitions, since the troubled economy has created some value and opportunities.

It looks as though Gold may have finally broken out above the $900/oz. level, and silver is following in suit. As Dr. Stephen Leeb has been saying for quite some time, the price of precious metals will likely outperform the rest of the market.

Crystallex (KRY) is in a definite uptrend. It was interesting to see that Hugo Chavez indicated that private gold mining companies may not be excluded from mining in Venezuela.

NovaGold (NG) is also in a definite uptrend. They managed to get thier bridge loan situated, and recieved some financing. What they need now is to get their Rock Creek mine back on-line, if they have not already done so.

Yamana Gold (AUY) and Pan American Silver (PAAS) have been in an uptrend, but should only be accelerated by the increase in the price of gold and silver.

Hexcel (HXL) is another that should now be in an uptrend. They had a good earnings report, and consequently had 2X the volume that day and four days of rally to follow it. That day of 2X volume put them above the 20DMA and 50DMA, with the 20DMA moving above the 50DMA. They should be in an uptrend now, but will be confirmed if there is a pull-back to the 20DMA and bounces off of it. I'm looking forward to the Boeing 787and the Airbus A380 to go in to production, hopefully starting this year. I think the production of those jets will be a considerable boost to the economy. B/E Aerospace (BEAV) is in an uptrend also, which is in the Aerospace sector along with Hexcel.

Consensus is that the price of oil is bottoming out, and can be seen in the price of Transocean (RIG) and Ultra Petroleum (UPL).

Dryships (DRYS) has really screwed up this time. They have been caught in the credit crisis, along with having a Debt/Equity ratio of over 1.3, which is quite high. George Economou has subsequently canceled some recent orders for some newbuilds, and canceled the dividend for the fourth quarter in order to preserve and/or raise cash. I sold all of my shares for the time being, but will watch for the price to bottom out so that I can but it back again. Part of my reasoning to buy it back is due to the BDI continuing to increase, thanks to China.