Today's Ride

Today was a beautiful fall day with temps in the low 70s, so I saddled up and went for a quick bike ride before the kids went trick or treating.

The route took me along the lake for a couple miles, then out into the country, past the local Pete Dye-designed golf course, then back around the lake, through town, and then home.

Nothing too exciting to write about, except the new pavement along the east shore of the lake. What a great ride. At one point I was cruising along at 20 MPH seemingly without effort. New pavement makes me happy! Yeah, I'm easy.

Here is the elevation profile for today's route courtesy of MapMyRide. My top speed was hit between mile 3.5 and 4.5.

Here are the stats for the ride:

Distance: 10.79 miles
Time: 0:46:23
Avg. Speed: 13.9
Max. Speed: 28.8
Calories Burned: 553

On another note, the fam spent last weekend at the cottage in Grand Haven, Mich., and during our stay we paid a visit to the Rock & Road bike shop looking for a new set of wheels for Mrs. Dogwood.

We want to go on century bicycle rides together and Mrs. Dogwood wants to try her hand at a triathlon or two next year, so we've been looking at bikes whenever we find a shop.

Long story short, we went, we saw, she test rode, we thought about it over night, then we bought. Her wheels of choice: a 2008 Giant OCR C3.

After test riding an aluminum frame OCR1, my wife hopped on the C3, which has a carbon fiber frame, fork and seatpost. She said it spoke to her and said "go fast!" So she did. 

When she arrived back at the bike shop she had a big smile on her face and I knew immediately which bike we would ultimately be buying. Our salesman, Doc, a Coast Guard retiree, left us alone to talk about the pros and cons of the two bikes, but Mrs. Dogwood kept staring at the C3.

Thankfully, we have a strong marriage, so I didn't feel too threatened by her new found love.

We spent the evening reading reviews on the bike and discussing what types of riding she will be doing, the aforementioned centuries and triathlons, as well as cross training for her marathons. (She finished the Grand Rapids Marathon two weeks ago in 4:04:04)

We're also talking about doing the Ride Across Indiana next July, which looks like it would be a lot of fun.

If we do any multi-day cross country bike trips like I'm wanting to do, then I'll be the one pulling the BOB trailer on my aluminum-framed Raleigh since heavy bags and trailers cannot be attached to the carbon fiber frame. Yeah, she was definitely thinking ahead.

Saturday morning we returned to the bike shop and bought the bike. Easing the pain, the price was marked down $500 thanks to a year end and model end sale. 

Since we didn't have a bike rack with us, the shop is going to hold the bike for pickup in the spring, which I think will give me just enough time to wreck my Raleigh. 

Daddy needs some fiber, and I'm not talking about Wheaties!

1 More B4 11 04

McCain's last campaign commercial. Well, probably not, but it should be.

Get Them While You Can

It appears that General Motors is killing the Tahoe, Escalade and Yukon SUVs. Just in time for sub-$2 gas!

Grand Haven Photo Blogging

It was fall break at our daughter's school, so we took advantage of the four-day weekend and went to the family cottage in Grand Haven, Michigan, for one final visit before the cottage is closed up for the winter.

As to be expected this time of year, the weather was changing for the worse as a front moved through bringing colder weather with a chance for snow on Monday.

On the plus side, the winds generated impressive wave action on Lake Michigan giving us incredibly beautiful views from our perch at the top of the sand dune.

The winds picked up overnight and by this afternoon I couldn't resist the urge to take a walk along the beach. It felt at least 10 degrees colder at water level and the wind was so strong it was difficult to breath while facing into it. Ah, the sacrifices I make for my readers!

I walked along the beach toward the pier and lighthouse located at the entrance to the Grand River, then went about halfway out on the pier. Large waves and the lack of a wetsuit prevented me from venturing out any further.

Below are a few pictures I snapped during my walk.

MA 50 Cross Over & Cross Under Updates

Triple MA Cross Over Update

Long-Term Trades Not So Much

Last week I purchased AA, STLD and PFE with the idea of holding the stocks for months if not years, especially since their yields were all north of five percent.

Well, this morning I wimped out and sold all three because I didn't like the way the market was trading. For a while I was disappointed in that decision, but this afternoon's carnage has cured me of such emotions. What a blood bath.

Of course, the market is now bouncing hard into the close, but I don't care at this point. It is ugly out there and confidence seems to be waning on a daily basis, especially mine. 

If the market calms a bit, then I'll buy these three back soon. If the market continues to sell off, then I'll buy these three back at lower prices.

Here are the buys & sells for the official blog record.

AA bought @ 11.87, sold @ 11.12 for a loss of .75 per share (-6.3 percent)

STLD bought @ 8.47, sold @ 9.99 for a gain of 1.52 per share (+17.9 percent)

PFE bought @ 16, sold @ 16.80 for a gain of .80 per share (+5 percent)

Prospects Update

I bought AA today at $11.87. It is currently trading at $13.

Prospects

The recent beat down in the stock market has rekindled my interest in value plays, so I went over to Finviz and searched for stocks that were trading below book value with a yield of at least five percent.

After looking through 71 pages of charts, the following stocks are under consideration for my dad's IRA. I'm am prepared to hold these stocks for months or a couple years if necessary. One stock, NI, would be predominantly a yield play rather than a price appreciation play.

I'm not committed to purchasing any of these stocks, I'm just thinking through the possibilities. I'm also looking at some growth stocks, but I haven't had the time to look through those charts.

New Long-Term Trades

After the market tested last week's low during this morning's trading session, I started buying stocks for my dad's IRA, which I've had in cash since July.

I made two buys today, the first was Pfizer at $16 with a yield of nearly eight percent. I will place a stop loss just below last week's low, which I don't expect the stock to encounter again any time soon.


The second purchase was Steel Dynamics at $8.45.

I traded this stock months ago as part of my trend following system and exited the trade with a 30 percent profit, but that was in the good ole days when it traded in the 30s.

Today, STLD is in the single digits after weeks of brutal selling by mutual fund managers and hedgies. Yesterday, the company reported earnings had nearly doubled.

Steel Dynamics is a well-run company with great long-term potential, but at this price I believe it may be a takeover candidate if the steel industry needs to consolidate in a slowing global economy.

While I'm waiting for the stock price to go higher, however, patience will be rewarded with a yield close to five percent. And for safety's sake, a stop loss will be placed below last week's low.


I believe the market is beginning to form a tradable bottom that could potentially last several weeks, so I want to begin building longer-term positions. The low set last week and today will require extra effort on behalf of the bears to break through, so it seems like a reasonable time to go long.

An added bonus is that buying stocks down here gives you an easy to identify stop loss level at the recent lows. Breaking those lows will lead to enormous pain so getting out before such a free fall will be an account and sanity saving exercise.

Finally, since bottoming is a process and not a one-day event, I will be scaling into stocks over the next several days as the market pops and drops while building a base for the next bear market rally. With each trade, a stop loss will be put in place just in case this is nothing more than a pause that refreshes the short sellers for the next leg down.

Joe the Plumber Interview

Oil Prices & the Cost of Gasoline

Earlier today on Twitter, FeedTheBull asked:

Have you seen a historical gas price chart based on Oil $USO? Would be interested to see where gas prices were when oil was $74.97

I replied that I have not seen such a chart, but I would poke around the Internet to see if I could find something. 

After a few minutes of searching, I found downloadable spreadsheets with historical price data at the Energy Information Administration website. So, instead of looking for a chart comparing gas and oil prices, I created my own.

The specific data used in the chart is the monthly average spot price for West Texas Intermediate Crude, and the national monthly average retail price for regular gasoline. 

Since the difference in price between oil and gasoline is so great, I divided the price of oil by 10 so the information would scale appropriately on the chart. So, when looking at the left side scale, the number 2 = $2 for gasoline, but $20 for oil, etc.

Emily & The Pumpkin Patch

Took the morning off to go on a preschool field trip to the local pumpkin farm with my four-year-old daughter Emily.

We took a hayride back to one of the pumpkin fields, then the kids went in search of the perfect pumpkin. 

After everyone had a pumpkin, it was back into the hay wagon for the trip back to the farm.

It started to rain on the ride back, but that didn't stop the kids from playing in the corn-filled sand box or the straw-bale maze. 

Emily didn't go into the maze because it was too dark, but she did spend a lot of time climbing up on top and then jumping off into a pile of straw. 

After about 30 minutes of playing, the rain started coming down harder so we loaded everyone into the cars and drove back to preschool for snack time.

Everyone had fun, including the parents, and the kids had a great adventure.

Today's Ride

I hurt, therefore exercise is bad for you.

It was a beautiful fall day with temperatures in the mid-60s and by 2:30 this afternoon I couldn't take it any more. So, I walked out of the office, pumped up the tires on my bike, and headed for the country roads around town.

Today's route took me past the lake for two miles, then out into the country past corn and soybean fields. Then it was a few miles along the south bank of the river, then a few miles along the north bank of the river, back through the country, and then another two miles along the lake and back to the house.

Fall is my favorite season, so I really enjoyed the colors and watching the farmers harvest their crops, except for the part where I had to ride through corn dust because a farmer was harvesting along the rode. A little dusty and the road was covered in small chunks of corn cobs, but it wasn't too bad.

Here is the elevation profile for the ride:

Minimum elevation was 728 feet and maximum elevation was 781 feet, for a total change of 53 feet. Due to scaling, the profile looks a lot worse than it actually is, mostly just gentle, rolling hills.

Here are the stats for today's ride:

Distance: 16.39 miles
Time: 1:06:35
Avg. Speed: 14.7
Max. Speed: 22.5
Calories Burned: 839

MA 50 Cross Over & Cross Under Updates

Not many stocks crossing over the MA 50 in the last few weeks, but the MA 50 Cross Under system is simply smoking in this environment with a year-to-date ROI of 59.89 percent.

Given the beaten down nature of the market, though, I don't think there are too many more stocks sitting above their MA 50 to trigger future trades! Now that is an interesting problem! Another week of intensive selling and I believe both of these systems will be sidelined due to a lack of available candidates.

Triple MA Cross Over Update

Both the five and four-day holding periods are showing a loss for the year, but they are still outperforming the S&P by huge margins.

Bottom Call?

According to Dealbreaker, SAC Capital went to 100 percent cash on Wednesday.

If true, this might go down in the history books as the ultimate bottom call.

Stay tuned.

Friday By The Headlines

MarketWatch had some great headlines today that perfectly captured the mood in the market, which ranged from gloom, to exhilaration, to fear, and then relief. I rode that emotional roller coaster and was mentally exhausted by 1 p.m.

I took advantage of the morning drop and made some money going long QLD and UYG when the Nasdaq Composite started bouncing off the S2 pivot point. Unfortunately, I committed one of the cardinal sins of day trading and allowed winners to turn into losers.

By then, fear was setting in and everyone headed for the exits, including me. I didn't care about the money, I just didn't want to be blown out in a 2,000 point decline if the Armageddon trade became a reality. Better to lose a couple hundred dollars than the entire account.

As it turned out, the market retraced the entire morning move, retested the lows, chopped around for a couple hours, then shot skyward, setting a new daily high, then giving up half the rally in the last 15 minutes or so.

When the rally began around 3 p.m., however, I was so wary of 40 and 50 point swings in the NQ (Nasdaq 100 futures), that I took a pass. I didn't trust the rally. Had no confidence in it. And wanted nothing to do with it even though I spent hours waiting for it.

Yes, I could have made a lot of money in 45 minutes, but my brain was fried and the day just needed to end. Trading with such a mindset is dangerous, and it has taken me quite awhile to get to the point where I'm okay taking a pass on a move when I have a lousy attitude or am feeling mentally or physically tired.

I've found that I trade the morning move best and that my alertness and willingness to take risk diminish as the day proceeds. By 2 p.m., I'm usually ready to call it a day if the afternoon trade hasn't developed yet. Today, my brain was done by 1 p.m.

Anyway, here are those headlines I was telling you about. They do a pretty good job chronicling an historic day on Wall Street.

Tokyo Free Fall

Saved another headline for the history books. Tokyo dropped 11 percent tonight before recovering slightly. As of this post, Dow futures contract is down 230, Nasdaq 100 is down 27, and S&P 500 is down 30.

Chart Porn

Trader Mike serves up the chart porn as he reviews the "controlled crash" over the last three weeks.

Max @ Retard Trading

A Jefferson Krull classic. Not for the faint of heart or the politically correct.

Top Advisor Leaves Obama Campaign

In honor of tonight's presidential debate, which I will not be watching because I believe they are nothing more than scripted performances devoid of substance, I bring you this late breaking news.

A top advisor to Senator Obama has left the campaign as a result of growing policy differences. Please watch the video for details.


H/T: Instapundit

Nasdaq 100, Long-Term View

If you want to know where the market is going, sometimes it helps to know where it has been. With that in mind, I am posting the following 10-year weekly chart of the Nasdaq 100 (NDX).

In 2005 and 2006, the 1,400 level provided support and a launching point for the rally that took the index to over 2,200 last fall. The market has since retraced nearly 100 percent of that move.

Prior support also can be found at 1,300 in summer 2004, and 1,200 in mid-2003.

For Fibonacci fans, the 61 percent retracement level for the 2002-2007 rally would be approximately 1,350, give or take a few points since I'm doing rough eyeball-quality calculations here. Or in other words, another 100 points down.

MA 50 Cross Over & Cross Under Updates

The MA 50 Cross Over system is holding onto a slight profit, while the MA 50 Cross Under system continues to shine in this market.

Triple MA Cross Over Update

The five-day holding period has slipped into the negative for the year, while the four-day holding period is still showing a slight year-to-date profit.