$EEM I was at a cocktail party (translation: kegger) last night with many savvy and somewhat savvy business people. The talk was of places to invest during an economy that was out of their league and lifetime. Sanguine yet nervous. Grateful yet wanting. Instead of the usual back-stabbing, gossip and boring human minutia that typically litters parties of this ilk, these 30-40 people swapped investment ideas like life lines.

I, of course, said nothing and didn’t tip my hand that I was a trader. It dawned on me through the din of their nervous glances that I hadn’t looked at the emerging market ETFs in a spell. Motivated to work I left without sampling a single plastic cup of Hamms beer. My loss, but one I could make up for at the nearest 7-Eleven.

Looking at EEM above, we see the same chart patterns played out in every US stock: the 2008 market crash followed by the 2009 sucker rally, followed by a bit of consolidation or minor pullback.

Wash, rinse, repeat.

I’d be a buyer of EEM if it managed to close above 35. I’d begin with a seed position and build into strength after each Point & Figure buy signal (provided EEM continued to move up). Always buy strength and sell weakness. The chart breaks with a close below 30. But that break doesn’t mean the chart is broken…it’s just weakness. Sell it. Leave knife catching to mouth breathing people with extra cash and sweaty gamblers. Think of it this way:

Take your kayak a and walk it to the nearest Class IV river. No matter where you launch your kayak, there’s always some show off meat-sack trying to swim against the current. Iron man training. Wait for him to wedge his foot in a rock and drown, then launch your kayak with the current and note his mistake as a way to gauge undertow.

It’s the same in the stock market. Watch for the guy with knife cuts on his hands and run the other way.

Wash, rinse, repeat.

In honor of the 4th of July – our nation’s 233rd birthday – I thought I would break my recent streak of highly opinionated posts and list a few examples why I love being a complete nerd.

-Stephen Hawking recently spoke about how humans have entered a new stage of evolution, one which does not focus so much on the Darwinian concept of internal genetic mutations as an “external transmission phase”, where the accumulated knowledge of our forebearers has become as important to our species’ continued growth as our phospho-linked nucleotide chains.

-If fusion takes too long to become a reality, it’s cool to know that researchers have been hard at work at equally creative yet much more tangible methods of power generation, including using the waves of the ocean as well as creating “turbine kites” that fly upwards of 30,000 feet high to capture wind energy.

-Quantum encryption is inching ever closer to becoming a commercial reality.  Freaking amazing.

-While the idea of moving an object firmly anchored in spacetime faster than light is impossible, there is no property of the physical universe which prevents spacetime itself from moving at superluminal speeds (after all, it happened just after the Big Bang).  This is the foundational idea behind the theory that “warp drive” may not actually be impossible to achieve.  The idea rests upon the ability to move a “bubble” of spacetime – within which resides the ship to transport – faster than light through the universe.  There are obviously thousands of additional questions that need answers and equations that require solutions before this moves beyond the theoretical stage, in particular this one about spacetime bubbles becoming unstable at superluminal speeds.  Nonetheless, the theory is sound.

Have a wonderful 4th of July, everyone!