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Underexposed - Canadian Stock Journal

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  #151 (permalink)
Calgary Alberta/Canada
Posts: 934 since Feb 2014

deaddog View Post
I agree that you shouldn’t panic on a sell off. Do you have an exit strategy in place for FP if it keeps falling?

Fundamentally it’s a newspaper. Advertisers are spending their money on social media. I don’t see much of a growth opportunity.

Normally a dividend yield of 13% is a red flag. They haven’t cut this month but I’m guessing it’s a matter of time. Their history shows cuts in 2011 and 2012.

If they do announce a dividend cut then there will be another panic sell off. When do you take your loss.

that dividend has been paid for years...

Dividend Summary - FP Newspapers Inc.

In 2009 it has paid a dividend of $0.06/share...then since 2010 to the present it has regularly...every month paid $0.05/share which right now is a 12% annual yield.

If this were a company that was inconsistent in its dividend payment or suddenly raised its dividend to that level, I would agree with the red flag scenario.

But this is not the case....you purchase this stock for its dividend which in Canada is taxed at roughly 1/2 that of normal interest income and there is no other simple , non-dividend investment that can touch that return.

Do I have an exit plan for this stock.....no...if anything I would probably increase my holding for the dividends

Stock Market Quotes | Stock Market Charts and Graphs

As you can see here the stock has its ups and downs...but the dividend over those years was consistent and religiously paid.

This stock is purchased for that dividend...not growth. I intend to show that dividends are worthwhile collecting.

To sell now would not be advisable in this case as

1. I would forgo those dividends.
2. I would incur a real loss rather than a paper loss.

I do not expect the Winnipeg Free Press to disappear...

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  #152 (permalink)
Legendary Market Wizard
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Underexposed View Post
that dividend has been paid for years...

Dividend Summary - FP Newspapers Inc.

In 2009 it has paid a dividend of $0.06/share...then since 2010 to the present it has regularly...every month paid $0.05/share which right now is a 12% annual yield.

In 2009 the distribution was 9.5 cents per month.
In 2010 they paid a special distribution in stock of 30 some odd cents then did a share consolidation so that every one had the same number of shares.

Here are a couple comments that scare me from the quarterly report.

FPI declared dividends of $0.600 per share, resulting in a payout ratio of 95.1%.

In response to the declining advertising revenue FPLP has experienced over the recent quarters, we are completing a review of our operating costs at all our business units and have and will continue to implement cost reduction actions wherever this makes business sense.

Somebody is dumping

"The days when I keep my gratitude higher than my expectations, I have really good days" RW Hubbard
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  #153 (permalink)
Calgary Alberta/Canada
Posts: 934 since Feb 2014

deaddog View Post
In 2009 the distribution was 9.5 cents per month.
In 2010 they paid a special distribution in stock of 30 some odd cents then did a share consolidation so that every one had the same number of shares.

You cannot base judgements today on happenings over three years ago that is prehistoric history. Look at the dividend payouts for the years from 2010 to the present....very consistent...monthly payouts of $0.05 on share prices worth between $4 - $6/share.

to me there are no red flags ....that quarterly report was based on advertising revenue following Christmas....this is a typically low advertising period. It is My opinion that this is a huge over reaction. The company has no debt, It is not going to disappear, it is the dominant newspaper in the region that it services....it will bounce back.

My only regret in this play was not waiting for the March financials before purchasing this stock.....THAT WAS MY MISTAKE...but I am not going to compound that mistake by taking a huge REAL loss when I am confident of a rebound.

this stock is ridiculously low IMHO...it is $0.30 below its lower Bollie....to sell now would be to sell a day or so before recovery and if that happened you would kick yourself around the block for panicking.

I am going to purchase more of this stock at the right moment and that moment has not arrived.

Look at the above chart during the previous fall on May 15...see the formation of the indicators below the main chart....there is a MACD/BBwidth squeeze there...about the same time as that squeeze happens you note that the Slow Sto starts to recover its value.

The time to buy this stock will be when BOTH the MACD and BBwidth reverse direction to form that squeeze look.....that will be the end of the down turn...I will be buying for capital gain as well as dividends.

Here is the status of my portfolio here as of 10:30am MST

Despite the fall of this stock....I am still on the plus side for gains for the week....I am currently wondering what I will sell in order to have cash to buy more FP and I am thinking BXE.TO at the moment though that may change...the decision won't happen for at least 2-3 days.

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  #154 (permalink)
Calgary Alberta/Canada
Posts: 934 since Feb 2014

Well, let us look at gold again as it has been a week or so since I last did a full comment.

Not much has changed...we seem to go from one triangle of resistance/support to another. I find it fascinating that this process is as slow as it has been. Notice the constant lower highs since mid-March as well as the consistent higher lows for the same period. This to me reflects the indecision as to where the price will ultimately go. That support line has been really tested 3 times (the shadows below the support) but each day this attack is thwarted. A breakout/down could happen at any time now but cetainly something major should happen before the end of May.

the price IS looking a tad bullish at this point. In that blue circle see Slow Sto has been slowly climbing, as well the MACD also has higher highs (muted though they be) and the BBwidth has taken a significant jog downward...to a point not seen for 6 months.

the BBWidth indicator is the trigger and it is a hair trigger now. The fact that the Slow Sto and MACD are rising gives us the direction.

Early morning today saw the price fall suddenly to about $1290 which is the near bottom of the lower Bollinger Band but it quickly popped up $1297 which is pretty much where the 20day SMA is located...so another attacked directed toward the Support line was denied.

this is my "sentiment chart" Look at the area circled in the ADX chart at the bottom. I call this cross and recross of the DI+/- lines "chaining" and this shows indecision...currently it is looking a bit on the bullish side as it is green line up.

the RSI is very neutral though right now it looks to rise over 50. The CMF in the main chart is trending bullish.

So this chart gives hope for a bullish move though it is only a very mild indication

the Ichimoku chart here is slightly bearish...the CCI is mildly bullish, while the On Bal Volume is bearish. In the Ichimoku the price of Gold has been bearish for a while as it is below the clouds. However the clouds have a small window of the next week or so where they are very thin. So a push in the price of gold may result in it rising easing above the clouds....if this does not happen though then that thick red cloud on the horizon will make things difficult for a long while afterward. Mixed messages here.


The results of this look are mixed but I would say it looks a tad bullish now .... but this tart has teased us before and change her mind very fast.

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  #155 (permalink)
Calgary Alberta/Canada
Posts: 934 since Feb 2014

Well this seems like a bit of a Simon Says game...one step forward 2 steps back.

Here is the status to date for this portfolio

Two days of bad losses but overall we are still in the black overall. If this were a loss due to one stock I would be worried about that stock and would probably have bailed on it. However this seems to be a general malaise, most stocks had losses based on profit taking and general sentiment...not the least being the sentiment there should be a correction in the USA markets.

We have collected some dividends this week to compensate some to the losses

As you can see, this is starting to accumulate and next month dividends from FP.TO will be added. The money is added to CASH to be reinvested.

And what has happened to FP.TO

Well it has stated its recovery and is now back into the Bollinger Band envelope as I predicted. Look at the indicators....see how the MACD and BBwidth are hinting at a reversal of their respective trends....thus forming this MACD/BBWidth "pinch"....it is not there yet and until it is the stock price can fall again (this rise could only be a rest).

But I don't think it is a rest as the Slow Sto is rising nicely as well.

Will it rise back just as fast as it fell...could happen but I doubt that very much. The first step of the recovery is to return to the 20daySMA (dotted green line)....this could take 2-5 days...from there it will wander above/below this average until the Bollinger Bands tighten....from that point it could breakupward or down...right now that is not apparent...but as I said earlier, that rapid fall was an over-reaction to the financial report + the double whammy of the view of the economy by many.

Hopefully things settle down next week.

Oh yeah....gold....that tart is just a tease...the price getting tighter and tighter between resistance and support.
Well most like it tight but then it can be a mess when the sentiment explodes :P That may happen in the next week...Something has to happen there soon

It is a long weekend in Canada this week....see you in the next couple of days

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  #156 (permalink)
Calgary Alberta/Canada
Posts: 934 since Feb 2014

Well I am back from the long weekend holiday...no snow for a couple of weeks now finally!! Weather is weird everywhere I suppose I should not complain about a little snow off and on...{sigh}

I was looking for some change in Gold but the ratchets just get tighter with no breakout...up or down....this cannot go on forever.


We are almost at the apex of that triangle now...amazing

The price tested that resistance line today but failed to cross it. There is some mild positives in the indicators below but they are far from being definitive...the best line through the Slow Sto is still positive for the last month but the last peak was lower than the previous on...however the it has not fallen below the last low in that chart. The MACD has a slight positive slope for the same time period AND (you need a magnifying glass ) the last high is a higher high.

As shown above...the CCI and On Bal Vol cancel eachother out. but looking closely at the thin red/blue lines they are converging...not diverging...you want the blue line above the red. the commodity's price has about 8 days to rise otherwise it will be stalled under that red cloud.


Still too close to call but I still think the bullish side wins over the bear by the smallest of margins...when I look at that first chart showing the triangle...I would say it would not be unreasonable for this situation to resolve itself within the next 1- 5 days...Monday or Tuesday at the latest.

So far I have looked at nothing but TA for a judgement. It is hard to find unbiased news on gold...but I will see if I can find some and see what they predict.

Nothing much has changed in this chart...the CMF is still green side up, the RSI is dead-assed neutral but there is a glimmer of positive in the ADX DI +/-....see in the circle...the green DI+ is diverging from the red DI-...it isn't rocketing away but it is not converging....this is more and more looking like a bullish signal...not indecision.

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  #157 (permalink)
Calgary Alberta/Canada
Posts: 934 since Feb 2014

Ok...Gold spot prices get tighter and tighter. The maximum price a buyer will pay (resistance price) is getting very close to the minimum price a seller will accept (support price). This cannot go one forever....sooner or later one or the other has to blink.

So...I think I have a pretty good handle on the TA for the spot price of Gold. To me it is clear that something will significantly happen this week...earlier I predicted 1-5 days which would take us to next Monday...a window of 5 business business days.

I thought I'd look at some news and see if there was any insight there

The best place to start in my opinion is on Kitco.com...most of the news is free of hype. Here is the URL

Kitco Precious Metals News Headlines - Gold News, Silver News, Platinum News

it is here you should find decent news to choose from..and that is where I went. The most unenlightening in that list is MarketWatch...the reason I say so is that most of their analysis is 20/20 hindsight. I do go there occasionally if something major has happened...they will analyze that to death IMHO. Here is their discussion on gold prices

Demand data fail to give gold much of a boost - Metals Stocks - MarketWatch

here are a couple of quotes:

A break below $1,283 is possible, and this could see gold quickly fall to test longer term support at $1,200, he said. adding that’s likely to happen if the technical traders continue to dominate. “However, should physical demand pick up on rising geopolitical tensions and Indian demand return with the easing of [import] duties, gold could quickly challenge resistance” at $1,385 and $1,418, he said.

Tell me something I haven't already figured out...Technical traders looking for a break in the support???? Not this trader. {sniff}

Traders looked to the week’s speeches from various Fed officials. On Monday, San Francisco Fed President John Williams said it will likely be more than a year before the central bank begins raising interest rates. Dallas Fed President Richard Fisher also appeared with Williams, while former Fed Chairman Ben Bernanke spoke at a separate event.

“Williams did caution about the diminishing improvement in housing, and suggested that the continued tapering and subsequent rate hikes ahead should not be expected to offer an environment of totally smooth sailing,” said Erik Gebhard, co-founder of Altavest Worldwide Trading.

This has little to do with the current price of gold and is more about filler for the article. There is some talk about diminished demand...well yes...that is why the price has fallen so much....but it offers nothing about the mexican standoff happening now.

the next news source is BullionVault

Gold Bar & Coin Demand Hits 4-Year Low | Gold News

this is a little better. It at least discusses the #1 and #2 buyer of gold bullion...China and India. The world does not revolve around US interest rates IMHO for everything.

Bar and coin demand in No.1 gold buyer China and No.2 India – where import restrictions to try and boost the Rupee's value have forced inflows to the less visible "grey market" – more than halved in Q1 2014, dropping 54% and 55% by weight respectively and falling well over 60% by value from Q1 2013.

India's year-on-year drop in legal gold imports then worsened in April, notes the latest Precious Metals Update from gold bar refining giant Heraeus, dropping 74% from 2013's record levels, sparked last spring by the 2013 crash in world gold prices and finally leading the Congress-led government – defeated by a landslide in this month's national elections – to impose a de facto gold import ban from July.

ok...there are good reasons why the price of gold has dropped...nothing to do with US interest rates....the major players in the game decided to reduce imports...that makes sense to me.

Flows of gold from Western vaults to satisfy the demand of eastern consumers," says the World Gold Council, "have slowed as global gold markets have gradually returned to a more 'normal' state of affairs" – evidenced by the drop in Asian gold premiums over and above London's prevailing large-bar price, taken as the benchmark by bullion dealers worldwide"]"Flows of gold from Western vaults to satisfy the demand of eastern consumers," says the World Gold Council, "have slowed as global gold markets have gradually returned to a more 'normal' state of affairs" – evidenced by the drop in Asian gold premiums over and above London's prevailing large-bar price, taken as the benchmark by bullion dealers worldwide.

hmmmm....this reinforces my dislike of gold ETF's that claim to be backed by gold in their vaults.

this is a website that offers comment and data on where gold is going.

Harvey Organ's - The Daily Gold and Silver Report

this is a comment that would scare me a bit..

The two ETF's that I follow are the GLD and SLV. You must be very careful in trading these vehicles as these funds do not have any beneficial gold or silver behind them. They probably have only paper claims and when the dust settles, on a collapse, there will be countless class action lawsuits trying to recover your lost investment.
There is now evidence that the GLD and SLV are paper settling on the comex.


The registered vaults at the GLD will eventually become a crime scene as real physical gold departs for eastern shores leaving behind paper obligations to the remaining shareholders. There is no doubt in my mind that GLD has nowhere near the gold that say they have and this will eventually lead to the default at the LBMA and then onto the comex in a heartbeat (same banks).

No this may be a little alarmist...but still...to me if I wanted Gold I would stick to bullion or coin....though if I really thought the financial apocalypse was coming I would be like Asians and buy 24kt gold chain....WHY? what are you going to do with a single 1 oz gold coin or wafer worth say $1000 - $3000 when you want to buy groceries or services? Get out your file and rasp off a bit??.... 24kt gold chain is 97% gold and you take out a link or two and go shopping....makes sense to me.

Here is a chart showing the depletion of gold by companies that are supposed to back their investors with gold bullion

it seems to agree with what the previous blogger, Harvey Organ, was talking about though it is COMEX not GLD or SLV. Paper gold is not worth the paper it is written on...you are fooling yourself IMHO.

Lastly is an article written by Kitco itself

May 20 Afternoon Gold Report With Jim Wyckoff

another good source of good info.

It was a very light day for U.S. economic data Tuesday. Traders are awaiting Wednesday afternoon’s release of the minutes from the latest Federal Reserve Open Market Committee (FOMC) meeting. That report is arguably the most important world data point of the week.

I will add another quote from Harvey Organ....lots of stuff to plow through in his blog...is it gospel? I am not sure but he seems to back up his assertions with data.

Tomorrow, Putin visits China set to sign the huge "holy grail" deal. This will be the start of the huge waterfall in the uSA dollar.


Well we read the reason for the decline in gold price (reduced demand of China and India) and it appears that tomorrow, Wednesday, is an important event be it the Fed Reserve announcement or Putin inking a deal with China

It falls in line with what I am seeing in the charts.....like I said....this triangle cannot narrow to the apex forever....someone will have to blink.

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  #158 (permalink)
Calgary Alberta/Canada
Posts: 934 since Feb 2014

well, the bleeding has stopped and some of the losses were reclaimed. Here is the status as of today.

FP.TO is still the big loser...but there has been a recovery there

The share price is within the Bollinger Band envelope, however, is this a bottom recovery or is it just a rest before falling again in a serious way.

the first clue that this might not be over is the fact that the MACD/BBWidth "pinch" is not complete. Also the share price seems reluctant to aim at the 20 daySMA...this looks very much like the pattern that happened on mid-March. However the Slow Sto looks promising so PATIENCE is required there will not be a rapid recovery with this stock...But then I bought it for the dividends long term

Gold??? well it is getting tighter again between resistance and support....if that is possible

nothing much to do but sit tight for now

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  #159 (permalink)
Calgary Alberta/Canada
Posts: 934 since Feb 2014

I cannot stand it!!! Never have I seen such a triangle filled to the apex before

Look at it....the range narrows and narrows

{sigh} I keep hitting the submit instead of preview button....too excited I guess

Note in the above chart the widening distance between the DI+/- lines...getting more bullish

I cannot embed the Ichimoku chart but open the thumbnail and look at the thin red/blue lines...the red has arched down to the red

Conclusion for me is that Gold will break out tomorrow...it will break the resistance line....how high it will go is a mystery but it cannot go on this way much longer....Monday at the latest but I think it will be Friday.

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  #160 (permalink)
Birmingham UK
Experience: Intermediate
Platform: NinjaTrader
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Trading: YM/Gold
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Underexposed View Post
Look at it....the range narrows and narrows

Sadly that's all we can say. It's certainly a coil and from here it should be interesting to see if the indexes also go with it or go opposite, in either direction.

I'm thinking:

a) Both up, printers have found yet another tricksy way to debase or hide debt, rather than destroy it. Sideline smart money needs to keep acquiring gold and actual companies to preserve real wealth. Life goes on, but most are poorer. No change there.

b) Gold up, indexes down, fear of systemic issues finally reappearing, including major conflicts, end of current financial system, less law and order. Maybe the magicians are out of tricks.

c) Gold down, indexes up, party continues, all is well in the world, for a year or two more.

d) Both down, debt destruction takes hold, the rest of the world can no longer hide from China's mountains as well as keeping USA and Europe under the rug.

e) All options will continue to rotate and need hedging against or taking advantage of.

F) That because of floating currencies it's actually impossible to make sense of the options or predict anyway, and we will continue to have all four just playing tag until the bond market finally says ENOUGH.

g) That it's Friday and yet another bank holiday so have a great weekend.

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March 21, 2015

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