A Comment -- General Comments From an Expert (A Commentary)

Fear factor. He is measuring Dow Industrials vs. TLT 20-year Treasury Bond. As fear increased in the early part of last year, prices were falling. With the TLT we have the same fear level but the prices are much higher, the divergence between price and fear. Market is saying the fear is likely to abate. He wants the TLT to roll over.

Gold. A-B-C Correction in Gold chart shows a long-term primary trend line, which goes back to 2004. It shows the A wave down followed by the B rally followed by the C wave. What is interesting about this C wave is that it subdivided and he expects that this is probably it. Expect gold will rally but keep in mind that it is still over loved and a crowded trade so don't go overboard.

Oil. Origin of the current uptrend in crude is around 2001-2002. Chart show that we are in a 4th wave correction and are almost done and is now trying to break out. We may run up to the old peak of $147 in the next 1-1.5 years. That could end crude’s large secular uptrend. Energy stocks may outperform. Usually in a 5th wave advance, there is a lot of bullishness, which is great but sometimes fundamentals can deteriorate. Test will be “will crude make a new high”. He thinks unlikely. Thinks oil stocks will lead this advance. He would prefer oil service stocks and the integrateds.

Natural gas. Still hasn't formed a bottom. This year's weather has created a lot of problems. It could drag on for a while yet. Long-term, it is probably a good theme but if you are going to look at natural gas, you have to look for the infrastructure i.e. companies that are building pipelines and LNG for export.

Employment. US Non-Farm Payrolls chart’s pattern is quite bullish. There was a consolidation up to 2008 followed by a breakdown. It then rallied back to above the support line. He feels it is forming a symmetrical triangle and is trying to break out to the upside. This is a very bullish chart.

Silver. Chart shows a very complicated correction. It had its spike in March reaching $49. In August, quite high while silver was down at $43, which he feels was an early warning on precious metals. Chart shows a very serious 5 wave correction. It is now back to the support level of about $27 and he thinks the correction is probably over for now. The equity side is probably a better trade.

Markets. There will be some very good opportunities this year but you will have to continue to be targeted. If you can focus on where the money is going there is some money to be made. It's a stock pickers market and a market where you are going to have to continue to be tactical and pick your spots. He continues to favour midstream energy companies that are providing infrastructure to the energy industry. Continues to favour that REITs as well as large-cap global dividend payers, where the cash flows are stable.

Oil. The one risk that we face in the energy space is that oil prices are elevated because of what is going on in Iran. Consumption in the US was down year-over-year in December and there is a bunch of new production coming on. It is not impossible that prices back off a little bit here.

For people who want to follow when callers call in on specific stocks, they can go to apps.facebook.com/modelprice and you'll see the graph that Brian actually sees in terms of model price and other work that he does so you can actually see what he does and play along.

Markets: There are three clouds – Slow growth in the US. This could be the year the housing surplus starts to disappear in the US and is the reason there are missing jobs. While china is slowing, he doesn’t see it slowing below 8% and that will keep the companies up. Third, Europe debt situation. He sees rates coming down and successful bond auctions. That will be the one that is back and forth and has some volatility to it. If the Iranians block the straights the price of oil could go up to $130 and shock the world economy. The US election could cause uncertainty to deepen in the US but that doesn’t seem likely at present. Volatility will not be as heightened as it was last year. It was quite irrational.

Squeezed a little bit of profits out of the markets last year. Tech Analysis allows you to become profitable as a opposed to be a victim. In 2012 he looks forward to more volatility. A trader should not become a victim. The first last 8-9 months were very traditional trading patterns but then Europe happened and it became a news flow oriented market. He would say that the trading patters in 2012 will become somewhat more normalized.

Oil: Has some significant resistance at $104 and it is just coming into that right now. Downtrend was broken and we got the rally and top level is $104. Will it break that? Just trade based on what happens. Sideways trend as opposed to down trend.

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Markets were up today because a lot of China, India, Europe and even the US Purchasing Manufacturing Indexes were up. This is a sign of economic expansion. This was combined with some year-end window dressing being reversed. Also, you generally find the 1st day of the new year is higher. Europe is still the wild card that needs to be solved and thinks we are in a European recession but North America avoids a recession.

Silver. Good time to get in? He treats this as a poor man's gold. At least in gold you have some feeling that it is a form of insurance, alternative currency, safety, etc. He prefers companies with high production growth, such as Tahoe (THO-T), rather than just own silver.