Overbought readings

At this juncture, the stock market looks very overbought. While timing declines based on such indicators in not of much value, it certainly does imply that any further gains from here will be tenuous and prone to sudden downdrafts. The indicators I follow for this are:

• CBOE index and equity put/call ratio
• ISE sentiment index
• VIX/VXO volatility indices

Long term dollar chart

As much as the fed has been trying to debase the dollar, this long term chart shows that it's fallen back to a little below where it was before the tech boom (the dollar index is the weighted avg. of the dollar against trading partners). If technical analysis has any value, the dollar should now bounce off that lower wedge line. On the other hand, a breakdown below that line will be mighty significant which might propel gold, silver and stocks to the sky!

Silver

All I can say is WOW!!

nflx

While the broader markets have gone nowhere since reaching their peak in April, Netflix stock has doubled! Of course, the company has been going gangbusters while the competition lays by the wayside. Reasons attributed to the meteoric rise are expansion into Canadian markets, savings from postage costs as more subscribers shift to watch content online and the potential to add more subscribers attracted to its increasing arsenal of entertainment programming.

In spite of these reasons, valuing such a company at almost 60 times earnings is insane! This is purely a momentum stock. While it may do really well as a company in the long run, the stock will most likely not give good returns for anyone buying at such lofty levels. I just shorted some, ready to get my fingers burnt a little but will bail if it continues to go stratospheric.

Junk

The junk bond rally through this year has been an absolute blessing for many companies. This means that companies with low credit ratings are able to issue bonds at favorable interest rates. Also, there is a lot of debt that needs to be refinanced in the next few years. Remember that the unavailability of short term financing was one of the big problems of the prior crisis. Although I don't have a sanguine view of the economy, it looks like the fiscal strain on many companies is being eased. Still, the household sector is in shambles and until that is restored, there will be no rapid growth in GDP.

Solving a pain point leads to opportunity

This is a strong belief..that a truly successful idea needs to come with a solid value proposition. On that note, I am almost ready to opt in for a 2 year contract in lieu of an upfront discount for the purchase of my next Android phone. However, what phone do I buy? Can I test drive a phone to check out whether I like it or not?

The open-source nature of Android and the already available emulation platform lead me to believe that it is in the benefit of the phone manufacturer to write a s/w program (or web interface program) that allows potential customers to take their product for a test drive. The main concern here would be a dilution of the experience the user has when physically handling the device. Any clever ideas to resolve this pain point?

Why is INTC getting hammered?

Intel recently reported results that looked very impressive, blowing past estimates on top and bottom line for the prior quarter and proving great guidance for the current one. However, even since the pop in stock from that report, there's been a slow slide in the price, taking it below the 20 and 50 day moving averages. My question is why?

The one reason I can surmise is that investors think we are at the peak for this cycle. Intel's results were heavily bolstered by their server sales with the consumer lagging. But aren't companies supposed to be in a new refresh cycle?

Or is it because Intel intends to buy Infineon's wireless baseband division? It is a much lower margin business than processors but does bolster Intel's ability to provide the entire suite of chips to sell phone manufacturers.

Any more thoughts from my adoring readers? :)