Super Stock Blog

Let's make our own bull run!

Month: June 2009

Western Refining Looking Good

Continuing the oil play, I introduce you today to Western Refining (WNR).  This stock is a great long-term play with the rising price of oil.  They recently got a 50% haircut when there was high speculation that they will not be able to pay off their high debt.  Last week, they announced that they were making a stock offering that would generate the necessary revenue to get rid of the debt.  Worse case scenario, we’re looking at them surviving another 5 years.  Best case scenario, this thing is gonna move up high and I expect doubling within the next year.

Technically, the stoichastics look good.  It’s past the bottom 20 right now.  It’s had a huge drop and we have a strong support coming in at $7.35.  The stock also doesn’t reflect the market very well which works to our advantage when this market could drop again below 7,000 on the dow or continue its move up.  There was great insider trading buying in at $9 after the money came in.  I’d suggest getting in soon.

Canadian Sands + Dividend = $$

As the market continues to plummet and things continue to worsen, dividend stocks will allow you to continue to win.  They work for long-term investors.  People that can wait it out a few years.  As they wait, they get rewarded.  I have a couple stocks I like currently that are pretty safe and if you have money to invest it will make you pretty rich in a few years.

HTE, Harvest Energy Trust, is a open-ended investment trust in Canada.  Their primary investments are in oil-related industries including shale-mining, oil refining, and drilling.  They also do invest heavily in petroleum and natural gas.  Right now, with crude oil hitting highs of $70, their stock price of $6.21 looks like a real bargain.  This gives you a dividend of 8.40%.  As with all stocks, make sure you do your due diligence!  I mention DD because HTE will get taxed in 2011 by the Canadian government and this will lower the dividend.  I do believe buying at this time will continually yield a pretty good dividend.  As oil prices go back up, you will see this stock price go up and you will happily be enjoying a nice dividend no matter what happens in the future.  I do believe oil prices will rebound, and I also believe this will rebound sooner than later.

PWE, Penn West Energy, is another open-ended investment trust in Canada.  They are paying off a yield of 11.40%. This one is also at a very low price.  I think both will be a good way to make money long-term and if you are willing to wait it out, you will be handsomely rewarded as oil gets back to its normal $80+.  Oil could become the next major currency.  Think about it, US dollar going down, what does everyone still use in the world?  Even with hybrid cars we still rely on that black gold.

If you have some money in your bank, put some of it in these two stocks.  Why not collect a fatty dividend!  When the market finally moves up, you will continually be rewarded and when the time comes when you need to sell, you can surely bet the price of these stocks will be more than it is right now!

Waiting for the right time to Short Treasuries

We are looking at a unsustainable rally.  The government has put a lot of programs in place that are propping up the stock market.  Look at all those TARP payments.  They’re all in the billions and they have kept the bank stocks up in the market. Some banks have more than doubled from their March lows.  Bank of America, BAC, has increased 300% from its bottom.  That’s insane!

China has a problem with these TARP payments.  They have been continously funding our economy by buying our debt.  However, their funding has been decreasing as they see us printing billions of dollars to pull ourselves away from this recession.  Tim Geithner recently made a visit to China to persuade them to continue to buy the US Dollar.  He went to a university and all the chinese students got a good laugh when he stated the economy was in great shape and the United States will continue to have a strong dollar.

The chinese need some convincing to continue to help us out.  They don’t want to fund us if our US Dollar is going to get weaker.  They can start buying other currencies that still keep their strength.  Hence, the government needs to give them ‘more for their money’.  They start raising the yield on the treasuries.  To do this, the government starts buying the treasuries.  Countries like China will get a fat yield for holding the US Dollar.  However, this artificial buying to keep the yield up cannot last forever.  Our treasury yields are reaching historic lows, and when these prices finally drop, we need to plan to take advantage of the situation.

This is where our two short ETFs come in, ProShares UltraShort Lehman 20+ Year Treasury ETF (TBT) and Direxion Daily 30 Year Treasury Bear 3x Shares (TMV).  When the government keeps lowering the price, we make money.  People will not buy treasuries unless they can get a nice yield for their money.  The government will have to raise interest rates, lower the price of the treasuries, or continually buy them up to continue this trend.  Whatever way they do it, shorting will be the way to go.  It’s just a matter of time to do it.  Currently, treasury prices are kind of high but in the next few months I expect there will be a good time to get in.  Just monitor those prices and yields and wait for the right time to bite!

Natural Gas is Bottoming Out

Yup, it’s time to start loading up on UNG, the natural gas ETF.  The summer has hit so it would seem like the worse time to buy this commodity, but market conditions and technical analysis give us a good reason to start getting into this stock.  It’s showing high volume, a flat-lining curve, and it appears to have start it entry back up.  This stock was at a high of over $40 just one year ago.  It has reached a very low price of $14 within the last month, and currently goes for $14.56.  As we get furthur into the weeks ahead, I see a increase in the price as demand starts increasing with futures trading.  Look as oil, it has irrationally moved back over $70 not because of demand but people are trading it and bumping that thing back up to levels from last year.

The normal ratio of oil to gas has averaged 6:1, we’re looking at over 14:1 currently.  It’s time for natural gas to move.