Dragonfly Capital | Aug 22, 2012 09:47AM ET
So I hear that Warren Buffett took another tubby and decided that Municipal Bonds were no longer a good thing to own. First questions: Was Meredith Whitney in the tub with him? Second: Dude what are you thinking? Giving him the benefit of the doubt and since he is a longer term investor let’s start with a look at the weekly chart to see what is out there.
That foxy old man looks prudent on this time frame. But he has a very long view. Maybe we should glance at the monthly chart as well. The rising channel dominates this chart. There are some signs of a topping action with the RSI flattening in technically overbought territory, with declining volume and a MACD that is fading. But the trend remains higher. For a long-term investor like Mr. Buffett you would expect a break of the channel lower before dumping them. Maybe he is just early or maybe he got a tip in the tub.
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