October 31st, 2014 - Issue #760

In This Issue

1. 10 signs that an unregistered offering may be a scam
2. U.S. Stock Index Bulls Stage Impressive Rally, But Stiff Overhead Resistance
3. Economic Calendar

1.  10 signs that an unregistered offering may be a scam

From the NFA ( National Futures Association ) website NFA: Investor Newsletter

Many companies engage in legitimate unregistered offerings to raise funds from qualified investors. In the past, soliciting or advertising unregistered shares was prohibited but, in 2013, the Securities and Exchange Commission (SEC) adopted a rule that allows unregistered offerings to be promoted provided an exemption is filed. These types of investments are not subject to some of the laws and regulations that are designed to protect investors in registered offerings, such as public stock sales that require disclosure documentation to be on file with the SEC. Despite these new regulations, fraudsters are still finding ways to pass investment scams off as unregistered offerings.
If you are presented with an opportunity to invest in an unregistered offering, in addition to your thorough research of the investment and the person selling it, the SEC advises investors to be on the lookout for these common signs of potential fraud:
1. Claims of high returns with little or no risk. This is a textbook warning sign of fraud. Every investment carries some degree of risk, and usually the potential for greater returns comes with greater risk.
2. The investment professional is not registered. Many forms of investment fraud that target retail investors are perpetrated by unregistered persons. Always check whether the person offering to sell you an investment is registered and properly licensed regardless of whether you know him or her personally. Investment registration, background and qualifications can be checked using FINRA's BrokerCheck or NFA's BASIC for derivatives investments.
3. Aggressive sales tactics are employed. Scam artists often pitch an investment as "once-in-a-lifetime," and create a false sense of urgency to force hasty decisions. Resist the pressure to invest quickly and take the time you need to properly investigate any investment before sending money or signing any agreements. A reputable investment professional will let investors take their time to do research.
4. There are problems with the sales documents. Avoid any investment in which the salesperson will not provide anything in writing. Legitimate offerings usually will be described in a private placement memorandum, or PPM. Additionally, sloppy offering documents containing typographical, spelling or other errors can be a red flag that the investment may be a scam.
5. There are no net worth or income requirements. Federal securities laws limit many private securities offerings to accredited investors.
6. No one else seems to be involved. Most offerings involve a number of third parties, such as brokerage firms, accountants or law firms. Be cautious if no one besides the salesperson appears to be involved with the deal, or if you are told not to contact someone who supposedly is involved with the investment.
7. It appears to be a sham or virtual office. A fraudster may establish a mailing address within a state in which he or she has no legitimate operations in an attempt to qualify for an exemption from registration. Be wary of any company that only has a P.O Box or you are unable to verify that the company has any actual operating presence in a given location.
8. The company is not in good standing. Any company seeking your investment should be listed as active or in good standing in the state where it was incorporated or formed. Every company must file and pay annual taxes to maintain this good standing. Each state, usually under the Secretary of the State, maintains a publicly accessible online database of companies.
9. The investment offer was unsolicited. Always consider the motivation of a person offering an investment, whether they are a stranger or close friend. Fraudsters often exploit the trust and friendships that exist in groups of people who have something in common. Be especially suspicious if you are asked to keep the investment opportunity confidential.
10. There are suspicious or unverifiable biographies of managers or promoters. Don't just take the promoter's word on his or her background. To appear legitimate, fraudsters may represent that they have had a successful career in the relevant industry when nothing could be further from the truth. Independently verify any claims, and ask the promoter for references.

Read the rest at:

NFA: Investor Newsletter

2. U.S. Stock Index Bulls Stage Impressive Rally, But Stiff Overhead Resistance

From our friend Jim Wyckoff

Jim has an excellent daily newsletter where he reviews different markets, alerts you for potential trades and much more. Included is his great bi-weekly newsletter with charts and a little longer term outlook. We recommend checking out his website, educational CDROM, and services at www.jimwyckoff.com click on image below to enlarge

The U.S. stock indexes have made a dramatic rebound from the October downside debacle. Bulls have upside momentum but there are now stiff resistance layers just above the market. This is still a very mature bull market run in the stock indexes. The indexes will now have to push to new for-the-move highs to gain the kind of upside momentum that would suggest a fresh, significant leg up in prices in the near term.

3. Economic Calendar

Source: Moore Research Center, Inc.

* Please note that the information contained in this letter is intended for clients, prospective clients, and audiences who have a basic understanding, familiarity, and interest in the futures markets.

** The material contained in this letter is of opinion only and does not guarantee any profits. These are risky markets and only risk capital should be used. Past performances are not necessarily indicative of future results.

*** This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts herein contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgment in trading!