The chart below is the GLD ETF weekly candle chart. According to technical analysis, gold is at an inflection point. This inflection point is a function of price being in-between the 50 and 100-simple moving average. Depending on your opinion of the 50-simple moving average, perhaps it can be ignored, for it is a short-term indicator and averages after the 50 are considered to be longer-term, even with weekly candle bars.

Opinions aside, the GLD has absolutely respected the 100-simple moving average. In May 2012 until July 2012, there were a total of six touches between the GLD and the 100-simple moving average. As price consolidated, tension was built and the result was a 10% rally.

The GLD has touched the 100-simple moving average about three times as of late, the white oval in the chart. This may be the beginning of similar horizontal consolidation or the calm before the rally. To the contrary, the SLV ETF lost its 100-simple moving average and it is now about to start having a negative slope for the first time in about three years! Silver, however, still has the support of the 150-simple moving average and the futures curve in gold is still pointing towards $1800 gold in 2017, see the charts below for details.

Feel free to e-mail any comments, feedback, suggestions, or general inquiries to… Author salernoma@mx.lakeforest.edu

The FTC is unlikely to act on the allegations made by Ackman, which only reinforces the confidence of those betting against Ackman’s short position.  Robert Chapman, of Chapman Capital, is one fund manager who has gained notoriety for being on the opposite side of Ackman.  The short interest ratio for HLF was nearly 27% according to Nasdaq, which released this number on December 14^th, prior to the Ackman’s presentation.  If the ratio is even higher than that now then it would be even more unlikely for the shares to fall.  HLF also has an attractive dividend, which is around 3.1%.  The dividend payout should keep investors interested in buying the stock.  Daniel Loeb, of Third Point LLC, recently took an 8.2% stake in HLF, that’s roughly 8.9 million HLF shares. Third Point is the most recent firm to bet against Ackman’s claims.  Tim Ramey, an analyst from D.A. Davidson and Co., stated that Loebs investment “sounds incredibly wise to us.”  Ramey went on to state, “The Ackman case doesn’t have any merit.  It attempts to prove the company’s a pyramid scheme when the prima facie evidence is that it’s not.”  The bets against Ackman have been stacking up and are providing support for HLF shares.  Shares of HLF are more likely to hit $55 a share rather than falling to $25.  Today, January 10^th, is HLF’s analyst day.  The meeting should provide investors with a better understanding of what exactly is going on inside the company.  The company is likely to spend a majority of the meeting defending itself against Ackman’s allegations.

Author: Tyler Sciortino

Contact for questions or inquiries at tsciortino312@aol.com

CLX shares recently suffered a 5.8% pullback starting 12/19/12 and bottomed out 12/31/12. Historically speaking, CLX suffered a similar short-term move from 6/21/10 to 7/6/10. In both cases, CLX rebounded quickly after the dive. The next supposed move is horizontal consolidation for a few bars before moving back up to the top of the channel; as the CLX chart below displays with various annotations and highlights.

In both cases, CLX has/had its compilation of moving averages below it and moving with a positive slope. Additionally, in each case, the aforementioned bottom was found when the equity came close to the 200 day moving average and bottom of the channel. The parallels in the chart are very interesting, however one does not even have to believe that the two instances will mirror each other perfectly. The bottom line is that CLX is in a powerful channel that it has historically respected and traded along with and considering the massive moving average support below us, a test of the upper bound may be in order.

Fundamentally, CLX recently announced that they will hold a webcast discussion disclosing their second-quarter, fiscal year 2013 results on Monday February 4th 2013 at 1:30pm ET.

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Author salernoma@mx.lakeforest.edu