You are a free subscriber to Me and the Money Printer. To upgrade to paid and receive the daily Capital Wave Report - which features our Red-Green market signals, subscribe here. A Harley Davidson Trade and the Week in Review...Things haven't looked this bad for HOG since April. That's a good thing for contrarians looking to take advantage of the Fear...
Dear Fellow Traveler: This is typically a day that I do a chart party… but I’m sort of out of that mental mode right now. I’ll dive into some charts this week at Money Printer… but I do want to slow things down a tad for the next few days. Why? Well… when you have an eight-year-old, you know that you’re on a bit of borrowed time for Christmas. Those “Questions” have started… the ones that require a solid… “Well, what do you think?” when it comes to the man who will now be breaking in our windows due to the lack of a fireplace in our new house… This week could be the end of this era… She’s too rational, and some of the kids at school have already been saying things (a little too bluntly). That innocence all goes by so quickly that it doesn’t make logical sense. But the world doesn’t slow down for us… It just keeps spinning… This will be a very good week… Amelia’s off from school… I get my annual box of high-end baseball cards for myself, and this is my wife’s favorite holiday. We’ll be in New York to see friends next weekend, see the trees in the city… and unwind the rest of this year, which is necessary. Don’t work too hard this week… I’ll probably knock out my Postcards in the next 48 hours… as I hope (I hope) that the things outside my control don’t bubble up. I don’t just wish a great single day… or eight days… but a great last 10 for you through the end of the year. Make the most of this time… start forging new habits now (not on January 1), and think about how those goals align with who you want to be. That latter element is what matters… because a goal doesn’t accomplish anything for you. Understanding how these things align with your values and purpose will help you stay committed to whatever changes you aspire toward. This was a tough year for me… but I’m not going to wish the next 10 days away just to get to 2026. No, we’re going to slow down and make the very most of this time. Today, I have a little bit of a change… No rant about monetary policy… but a question about a pretty good company that has seen better days… So, first a question… What Is Wrong with Harley-Davidson? As I start to assess my list of quality and momentum opportunities for early 2026 - that list comes out for Capital Wave readers in about 10 days - I have started my research. I use a combination of Ben Graham intrinsic value analysis, Piotroski F score analysis, key moving averages, and historical 52-week assessments. This morning, as I whittled our names down from about 100 to 25, one name really stood out and finds itself under the microscope. Harley Davidson (HOG). I looked at this chart and said… “What the hell is going on here?”
Now, I’m not a motorcycle rider. I’ve listened to occasional interviews about the challenges of revamping this brand. But the last time I really paid any attention to it, it was an interview between its CEO and Morgan Stanley. And as I started reading interviews and articles since 2023… this is just one battle after another… Here are the challenges in just 30 months…
Coincidentally, Morgan Stanley is also the shop that recently cut its price target to $21 with a Sell Rating. But we’ve reached this point now where the math warrants some conversation. By many traditional metrics, this stock looks cheap. It’s trading for 70% of Book Value, Free Cash Flow under 6.5x, and EV/EBITDA at 9.44. It also has a surprisingly short float at 15% and has just bottomed out on oversold conditions in the Relative Strength Index and the Money Flow Index for the first time since April… See the blue at the bottom of the RSI and MFI on the Daily? Last time we were here? April… during the whole problems with Trump and trade.
The point is that we don’t tend to stay in both of these conditions very long. That’s a deep contrarian sign here. Coming out of Quad Witching, investors and traders should watch that orange line - that’s the eight-day exponential moving average. We want to see HOG start to turn here, and for that orange line to recover back toward the pink (20-day), blue (50-day), and green (100-day) moving averages. I know this is overly simplistic… but we are currently overbought, the stock is very cheap, and it maintains a strong F score. No one wants this thing… I can’t find a Seeking Alpha recommendation to save my life… Wall Street isn’t bearish… but it’s not helping. UBS’ Robin Farley put the stock at a $27 target on November 13. No other well-rated analyst has anything to share. We are down in the territory where targeting a put spread ahead of earnings makes sense - and we hope that the pressure unwinds from oversold territory. You’d have to want to own the company for $19.70… if it were filled (and I’m still debating this…) But if you look out to January 23, 2026, selling the $20-$18 put spread and succeeding at a $0.30 credit - could deliver a 76% probability of profit… a 17.6% return… and an annualized gain of 189%. Again, I’m speaking to my more advanced traders on this. For investors who don’t like options… pay attention to that 8-day EMA. If we start to see some positive crossovers, it will be worth speculating on very tight stocks back at these key moving averages. This is a contrarian buy after Triple Witching, sentiment low, and momentum starting to improve. It will definitely be a buy when our Russell 2000 signal turns Green… which feels like it’s 48 hours away. It’s worth a bid here with a tight stop in the 3% range. Finally… our January Quality Momentum list arrives in a week for members, as does our 2026 outlook on trends, key math behind our momentum readings, and much more. So, pick up a subscription for at least a month to get all these benefits… But you can also lock in an annual subscription right here… Finally, for our Founding VIP members, we will host our quarterly call in mid-January. I will have an update on this as we move toward the end of the year. Now… for the week in review… Monday, December 15 Have All of Us Gotten Bitcoin Wrong?What if we’re wrong about Bitcoin? What if we keep treating Bitcoin as an asset… modeling it, trading it, hedging it, when it’s acting like something else entirely?
What if it doesn’t matter whether it’s in a bubble or if it’s even investable? What if everyone is wrong about what it really is at its core… So… what is it? Tuesday, December 16 Everyone Everywhere About to Be an Expert on Japanese Banking PolicyThe last 13 months of market volatility didn’t come out of nowhere. It started in Japan. Every spike, every tremor, every “why is this happening?” moment traces back to stress in the world’s cheapest funding source. It all started with this chart…
Now… everyone keeps asking why gold and silver are going higher? Have you looked at the Yen side-by-side with each metal?
Weird… huh? Wednesday, December 17 Why They Need You in Debt... (No, Really, They Do.)The American Dream is no longer about a house and a car. It’s an invitation into long-term duration payments with an amortization schedule and a place to park growing liquidity...
You think I’m kidding? Well, I dare you to read this… Thursday, December 18 The Department of Justice Takes Out a Flashlight And Reveals...It was just two weeks ago that I asked where the next fraud would emerge…
Well, it didn’t take the Department of Justice to put out the indictment on one of the largest used auto networks in the nation… This could land one CEO in prison for life. Friday, December 19 Airline Miracles and Other Things I ThinkFor years, I took a flight back and forth between Baltimore and Ft. Myers for work. Every flight south would include a dozen or so people in wheelchairs… they’d board…
But by the time the flight landed, they were magically healed. They’d walk off the plane as if a man in the sky anointed them… Now… that same trend has gone national in the Wall Street Journal… Saturday, December 20 Damn this New York Times Analysis...Want to know my real problem with the New York Times editorial staff? Why, as a financial journalist, am I really pissed about this type of stuff? No NYT editor read that article before it was released and asked… Why doesn’t the word “Federal Reserve” come up just once in this article?  That’s pretty basic. But you know what else doesn’t appear in this article? “Quantitative easing,” “monetary policy,” or “asset inflation.” It’s not shocking… but what is these days? That’s all we have for Sunday… If you missed it… I released the latest edition of Postcards from the Edge of the World on Saturday with a new recommendation to protect against inflation and extraction… And the Insider Buying Report, we took a 100% gain on HYMC… and turned our attention to a new coal selection. Read about it here… See you tomorrow… with our next issue of The Capital Wave report. Join… as we’ll look for a change in our momentum reading this week… Stay positive, Garrett Baldwin About Me and the Money Printer Me and the Money Printer is a daily publication covering the financial markets through three critical equations. We track liquidity (money in the financial system), momentum (where money is moving in the system), and insider buying (where Smart Money at companies is moving their money). Combining these elements with a deep understanding of central banking and how the global system works has allowed us to navigate financial cycles and boost our probability of success as investors and traders. This insight is based on roughly 17 years of intensive academic work at four universities, extensive collaboration with market experts, and the joy of trial and error in research. You can take a free look at our worldview and thesis right here. Disclaimer Nothing in this email should be considered personalized financial advice. While we may answer your general customer questions, we are not licensed under securities laws to guide your investment situation. Do not consider any communication between you and Florida Republic employees as financial advice. The communication in this letter is for information and educational purposes unless otherwise strictly worded as a recommendation. Model portfolios are tracked to showcase a variety of academic, fundamental, and technical tools, and insight is provided to help readers gain knowledge and experience. Readers should not trade if they cannot handle a loss and should not trade more than they can afford to lose. There are large amounts of risk in the equity markets. Consider consulting with a professional before making decisions with your money.
|
Subscribe to:
Post Comments (Atom)
0 Response to "A Harley Davidson Trade and the Week in Review..."
Post a Comment