Month: November 2004

The Avalanche is Coming

Here’s an interesting article from the Times Online. Yes, the dollar has tanked since Bush was re-elected, and with the media finally working itself into a frenzy over the dollar we may be due for a bounce, but the trends discussed below are longer term and will outlast short-term bounces. Check it out:


From China With Love

Ever wonder what the Chinese central bank thinks about the U.S. and its desire to see yuan rise against the dollar (and rise now, not later!)??  Here it is, from

BEIJING: A senior Chinese central bank official has warned the United States not to blame other countries for its own economic difficulties, a report said.

Li Ruogu, deputy governor of the People’s Bank of China, also said in an interview with the Financial Times that foreign pressure would not force China to move faster on freeing up its exchange rate system.


Meridian Bioscience Inc.

Vivo_101804_gif Meridian Diagnostics Inc. (Nasdaq: VIVO). I took a look at this one after noticing its earnings report. Overall ranking 15th out of 137 stocks in IBD’s Medical-Products group (89th percentile). 80-87 percentile in sub categories. EPS/RS: 78/84. Market cap = $220 million, $237 million enterprise value, $79.6 million revenue, EV/revenue = 3x, EV/EBITDA = 13.4x, P/E = 24.6x, forward P/E = 22.7, profit margin = 11.5%, ROE = 31.3%, LFY revenue growth = 11.4%, % held by institutions = 27.2%, % short = 1.4%, $0.48 annual dividend (3% yield). Most recent quarter: 30% revenue growth, 58.3% earnings growth, beat estimates by 36%.


CryptoLogic, Inc.


Here’s an interesting small cap from Canada, CryptoLogic, Inc. (Nasdaq: CRYP), which is a software and services provider to the worldwide Internet gaming market and says its ECash Direct software has processed more than US$12 billion in secure electronic transactions utilizing proprietary, real-time cryptographic technology to enable secure e-commerce and information transmissions.  I noticed this company’s 11/5/04 earnings release, which showed $16.6 million in quarterly revenue, up 43% from the same quarter last year, and 23.5% earnings growth, which beat estimates by 31%.  I usually like to see EPS gains in excess of sales gains, but I took a quick look anyway and this is what I found:


Market Update

No changes to report in market conditions since my 11/6/04 post…  The rally rolls on.  On a short-term basis we are even more overbought, leaving latecomers waiting for a chance to get in as they watch their favorite stocks run away from them.  Shorts are getting toasted pretty good right now, too.  If we don’t get a little pullback soon we may get an upside capitulation, as late longs rush in at the same time shorts can’t take the pain any longer and are forced to cover.  We’ll see, that’s not a prediction, just one of many scenarios that could play out.

Dell: We Have Liftoff


Dell (Nasdaq: DELL) is just one of many stocks that have powered the rally since the last week in October.  Here we see it blasting out of a tight 13-month base on the highest weekly volume in 21 months (see circled areas on chart).  Many other stocks have had similar launches, especially small caps, techs, and medicals.  I’ll see about putting together a list soon, as soon as I finish sorting out the most recent batch of earnings reports.

On Art

Creativity is allowing yourself to make mistakes.  Art is knowing which ones to keep.

-Scott Adams

Fire’s Out


That warning doji candle and negative stochastic crossover mentioned three days ago (see "Up in Smoke" post) were negated the following day by the powerful tall white candle that came on impressive volume, as the Spiders (Amex: SPY) and many stocks, ETFs (exchange traded funds) and indexes simultaneously broke out of trading ranges to multi-month, multi-year, or all-time highs.  The powerful momentum is demonstrated by the near vertical advance from the $110 low and the breaking above the RSI (relative strength index) trendline.  See circled areas on the chart details.


Up in Smoke

The mainstream financial media (WSJ, CNBC, IBD, etc.) has been pushing “the market wants Bush” agenda all election season and now they’ve gotten what they wished for, four more years of Bush. Well today the cadre of the deaf, dumb, blind, but unfortunately for everyone, including themselves, not mute millions who “voted their wallets” got a surprise, although they don’t know it yet because we closed up today.