bhc investment Journal

bhc investment

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Hello!

I am the editor of bhc investment. I have introduced myself at

http://www.trade2win.com/boards/mem...introduce-yourself-post423025.html#post423025

and I am very excited to be part of this community. I will be keeping a trading/investing journal here and wish you all a happy and prosperous 2008!

As far as the Dow is concerned, I believe we are still in a bear market and the move from the January low is a countertrend. Once the countertrend is exhausted, the January low will be retested and eventually breached. Now, I am just waiting patiently for a meaningful high pivot to form. No position has entered yet so far.

With best wishes
bhc investment
 
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Hello GJ!

I think I'll call myself a technically driven fundamentalist. I am a huge fan of Warren Buffett, George Soros, Jim Rogers, and James Simons. I believe the fundamentals will win out in the long run, but price actions are irrational and tend to 'propagate' from a dominating time frame to another. I always keep myself well aware of most of the major events in the world, the facts, the lies, and the pivotal changes that could later become significant in future market development.

I tend to build up a sense of anticipation after studying the price actions across a number of time frames. I don't like following what the news, the CNBC/Bloombery is telling us. I like to anticipate what will be the next headline news.

For example, I correctly predicted that Crude Oil will make a new all-time high just after the sell call by Tom DeMark.

With best wishes
bhc investment
 
Some of my big gainers this year: Gold (from 730), Natural Gas (from 7.X), and Crude Oil (from 102.66), etc. I went again Boone Pickens when I was rolling over my position in Natural Gas.
 
Currently, yes -- I am waiting for some meaningful price actions to unfold in Sugar #11 before considering adding to my position, again.

I do the Dow, S&P 500, and Russell 2000 futures indices as well. We are seeing some form of optimism returning Wall Street, but I believe it is still a bear market. I will be shorting it if I can figure out the when and where.
 
This is what I said back in March:

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I suggested buying Crude Oil @ 104.04. Today Crude Oil hit $118! This year for the first time the collective oil appetite of emerging markets -- many of which don't pay the market price for oil -- will exceed that of the U.S.
 
There was a pullback of about 2% in Gold yesterday. I think we could see a meningful pivot forming here on the daily time frame. The market has tested the 900 support level for a few times now. Let's see if it's going to hold and subsequently bouncing off from there.
 
Hey bhc,

I just wanted to say that your journal interests me as I am someone from the complete opposite spectrum to yourself. It will be good to read your analysis from a fundamental point of view and a more investment rather than trading approach.

You mention you are anticipating Gold to move higher. The divergence between Gold and Oil has been something I have been watching recently. Do you mind me asking what your fundamental reasons are behind Gold possibly moving higher?
 
Hi Jay!

First of all, let me clarify: I make use of the technical aspects of the markets very substantially as well. I don't buy and sell simply based on the fundamentals. I believe price actions in the markets are irrational, I am a believer in George Soros' theory of reflexivity [1], and they tend to 'propagate' from 1 dominating time frame to another; every successful/consistent trader/investor makes use of some form of a market timing model, such as George Soros makes use of Tom DeMark's services and Warren Buffett times the markets through market sentiment to a certain extent, which is best described in his famous quote [2]:

"At the start of the party the punch is flowing and everything's going well, but you know at midnight it's all going to turn into pumpkins and mice. People think they'll be able to get out just before midnight, but everyone else thinks that too. What the wise man does at the beginning [of a rising market] the fool does at the end. Once a price history [rising market] develops enough for other people to see it and get envious, greed takes over markets. We simply attempt to be fearful when others are greedy, and greedy when others are fearful."

My view on Gold:

-- Gold is a currency. It has been seen that way for centuries, and will continue to be seen as a storage of purchasing power for the centuries to come.

-- As with all things on earth, Gold has its cycles of up's as well as down's. Gold was in a nearly 20 years of bear market between 1980 and 2001. Within that period of history, investors bought stocks and was shying away from Gold. It was a boom time for "paper assets", because of their higher yieldings.

-- Since 2001 Gold has been gradually moving to the upside. Such a move is signifying the return of "real assets", alongside commodities such as Wheat, Cotton, Sugar, Crude Oil, Natural Gas, etc. Investors are now shying away from "paper assets" and buying into "real assets".

-- The switch between "real" and "paper assets" has repeated several times in human history, each of which tends to enjoy at least 15 years of up's or down's.

-- The appreciation of "real assets" will be inflationary, which is now being felt world wide.

-- Although Gold has been gradually appreciating since 2001, it's inflation adjusted value has only just made a new all-time high. I believe the bull market in Gold is surely not yet over, and will possibly last for years to come.

-- With central banks around the world, particularly the Fed and now the BoE, literally printing gigantic amount of money in order to bail out the banks, which made irresponsible bets on risky and now worthless assets and securities, it makes the case for Gold as a currency even stronger. Our central banks are now cranking up their printing presses at full tilt, you got to be kidding me if you want me to continue holding the paper money they printed!

Personally, I believe Gold is still pretty "cheap".

With best wishes
 
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bhc,

You need to go through your personal settings and select the type of vendor you are.

Also do not put links to your site in you post thanks.

Nine
 
bhc,

You need to go through your personal settings and select the type of vendor you are.

Also do not put links to your site in you post thanks.

Nine

Hi Nine!

I am not a vendor. I am just an investor.

OK. Will not put links to my site.

With best regards
bhc investment
 
Hi boon! I've been reading your blog for a couple of weeks now, very interesting read. Keep up the good work.

ps: hello t2w!
 
Thanks for your insights into the Gold markets.

Your take on Gold is very interesting and something to watch for in the future. You mentioned the return of "real assets" in regards to many other commodities, gold included. Do you believe it's people wanting to hold on to these assets in favor of economies weakening or the increase in demand from the likes of developing countries such as India and China?
 
BHC has made some very good points about gold. I'm still slightly unsure about gold's direction. Ever since the heavy correction we seen recently, gold seems to be going nowhere. We have to remember the american government still hold substantial amount of gold in their vaults, if they were to liquidated even a small percentage of their inventory to raise capital, gold price will not hold. Retail gold don't seem to be doing too well because of the high prices. Currently china is the largest gold producer in the world, is there a need for them to diversify their foreign reserves to gold? Will the next US fed rate cut be the last cut? If it is and the american economy stablizes the dollar will rebound and thats bad news for gold. So there is something to think about. Even so I would still like to have a little exposure to gold.


ps: BHC: I thought gold inflation adjusted price has not reach all time high of the 1980s yet. Isn't it about the $2000 mark in todays market?


regards,
Lenk
 
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Thanks for your insights into the Gold markets.

Your take on Gold is very interesting and something to watch for in the future. You mentioned the return of "real assets" in regards to many other commodities, gold included. Do you believe it's people wanting to hold on to these assets in favor of economies weakening or the increase in demand from the likes of developing countries such as India and China?

I would like to draw a line between precious metals and commodities; I see the former as a form of currency, Gold in particular.

We are living in a world of fiat currency. All the paper money printed by central governments are no longer backed by Gold. In particular, the total US money supply has more than doubled in the last few years. The more money they print, the lower the purchasing power. Investors are buying Gold because they want a currency that can retrain its purchasing power, and that's not paper currency. (There's a video in which John Williams of Shadow Government Statistics explains about the M3 statistics. The video is also posted on my website.)

As with commodities, it's simply because of supply and demand. The developing world has gotten richer with a rising population of middle class who demand better food and higher protein, who has money to spend on stuff.
 
BHC has made some very good points about gold. I'm still slightly unsure about gold's direction. Ever since the heavy correction we seen recently, gold seems to be going nowhere. We have to remember the american government still hold substantial amount of gold in their vaults, if they were to liquidated even a small percentage of their inventory to raise capital, gold price will not hold. Retail gold don't seem to be doing too well because of the high prices. Currently china is the largest gold producer in the world, is there a need for them to diversify their foreign reserves to gold? Will the next US fed rate cut be the last cut? If it is and the american economy stablizes the dollar will rebound and thats bad news for gold. So there is something to think about. Even so I would still like to have a little exposure to gold.


ps: BHC: I thought gold inflation adjusted price has not reach all time high of the 1980s yet. Isn't it about the $2000 mark in todays market?


regards,
Lenk

Yes, Gold is going no where at the moment. If you are going to be a net buyer of Gold in the coming days/weeks/months/years, that's exactly what you want it to be. You want to buy it cheap and sell it when it's expensive!

No, I disagree -- the US government has no Gold in their vaults!

Personally, I believe the diversification by foreign governments as well as SWFs into "real assets" is inevitable and some are already doing so.

I don't like speculating what the Fed is going to do -- the Fed follows the market; the Fed follows interest rates. Read my post on my website named "Why I Want to Abolish the Fed too!"

With best wishes
bhc investment
 
No, I disagree -- the US government has no Gold in their vaults!

Don't know how accurate wikipedia is but according to this america has largest reserves in the world.

Official gold reserves - Wikipedia, the free encyclopedia

and also this Fund to sell gold reserves to plug budget deficit - Telegraph says IMF might be dumping some gold and also I read somewhere that the Swiss is considering dumping some gold too but not in open market.

This also provide a funny read The Politics of Debt The Gold Scam


ps: BHC: I hope you don't misunderstand, I'm not trying to undermine your forecast. Just giving the readers some impartial views and something to think about.

regards,
lenk
 
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Don't know how accurate wikipedia is but according to this america has largest reserves in the world.

Official gold reserves - Wikipedia, the free encyclopedia

and also this Fund to sell gold reserves to plug budget deficit - Telegraph says IMF might be dumping some gold and also I read somewhere that the Swiss is considering dumping some gold too but not in open market.

This also provide a funny read The Politics of Debt The Gold Scam


ps: BHC: I hope you don't misunderstand, I'm not trying to undermine your forecast. Just giving the readers some impartial views and something to think about.

regards,
lenk


-- Lenk, for information on Gold, I would like to draw your attention to the Gold Anti-Trust Action Committee. There's a great deal of information on their website that's never talked about in the mainstream media.

-- As I have said before, I don't speculate on what the Fed is going to do. Similarly, I don't pay much attention to what the IMF is going to do. Yes, they are a big player in the market, but what they are going to do doesn't really change my long-term view. In most cases, the big players tend to do things at the wrong times and wrong prices. For example, China Investment Corp invested a big stake in the Black Stone Group, but that IPO has been going downhill ever since it started trading. Gorden Brown, the ex-Chancellor of the Exchequer of the UK, sold 3/4 of the UK's national Gold reverse. That selling didn't tank the Gold market. In fact, it marked pretty much the lowest point of Gold in the last 10 years!

-- Everybody is free to express their views. Many thanks for your comments!
 
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