All the right junk in all the right places
I see the magazines working that Photoshop
We know that sh*t ain't real
Come on now, make it stop – Meghan Trainor
Well I'd love to say I hate to say "I told you so" but we're actually LOVING IT!
You would be loving it to if you followed our FREE Futures Trade Ideas (using techniques from last week's Futures Trading Workshop) at the end of yesterday's post, where I said pre-market:
That's why we have to switch off our brains and go technical in this kind of market. While TA may be voodoo, it's a voodoo a lot of people believe in and that, in itself, gives it power. It also gives us power to make money as we can see though the tricks that the Banksters are using to manipulate the TA and our Futures lines from yesterday still stand although Russell Futures (/TF) are 1,230 now and we also like Nasdaq Futures (/NQ) short at 4,600.
Right after that FAKE! pumped up open, we fell right off a cliff and the Russell ended up dropping 26.5 points, all the way to 1,203.50, which pays off $2,650 per futures contract while the Nasdaq fell all the way to 4,502.75, which was good for $1,945 per short contract – not bad for a free pick, right?
We had Tweeted out a more detailed pick from our early morning Live Member Chat Room (6:55 am) in which we also had picked 17,500 on the Dow (/YM) which paid $995 per contract and a long on oil at $44.50, which paid $500 per contract, a long on gasoline that broke even and a long on Silver at $14.50 that paid $1,250 at $14.75. See, you can make money betting both ways if you understand how Futures trading works.
We maintained our generally bearish stance into the close as we had very low expectations for today's Non-Farm Payroll Report and, in fact, job creation was a miss at 215,000 vs 231,000 last month and that's already (8:35) sending the Futures even lower (but we expect them to bounce back a bit today as less jobs = more easing). I won't get into our strategy again (see 7/25s very timely: "Using Stock Futures to Hedge Against Market Corrections").
Remember – we can only tell you what is going to happen in the markets and how to make money trading it – the rest is up to you…
Looking ahead, the BOJ held rates steady this morning at 0.1% but they continue to pump in 80 TRILLION Yen ($640Bn) in annual stimulus at a rate of over $50Bn a month into an economy that is 1/3 the size of the US. That would be like a $150Bn monthly stimulus in the US and, as noted above – it's all about that monetary base, which is rising at an astounding clip in Japan towards 70% of their GDP at the end of this year.
Likewise, assets held by the BOJ are now over $3Tn and again, that would be like our Fed holding double what they do at $9Tn or, as it is in Japan, 1/2 the GDP in Central Bank debt alone. Despite all the FREE MONEY being tossed into the mix, the economy is still clearly depressed and, despite the fact that the Daiwa Institute of Research estimates the economy shrank as much as an annualized 3.3 percent in the three months through June, BOJ Gov Kuroda says he doesn't THINK the weakness will continue.
Nonetheless, Asian markets were up this morning in HOPES that China will add more stimulus over the weekend to save the Shanghai Stock Exchange while the residents of Shanghai are all waiting for turns to climb to the top of this tower, so they can take a breath of non-polluted air.
This is one of the reasons we never believed China could keep growing at their breakneck pace, the pollution fallout alone is enough to slow them down as people are advised to limit their time outside over 100 times a year in Chinese cities due to the DANGER of breathing the air. This is the way LA was heading back in the 70s before all those crazy Democrats begin putting in environmental regulations that all 17 of the GOP candidates vow to roll back if we put them in office.
Politics aside, it's not just Japan ramping up the money supply as the US monetary base has grown from $800Bn to $3.5Bn in the last 8 years, and that's up 337% yet it too is having little effect on the broad economy as all those extra Dollars are being gobbled up by the people who need it least (the Top 1% people and corporations) while little or nothing is "trickling down" to the average citizen, who might actually put it to work.
Historically, this should be sending gold to the moon but gold remains in it's own little recession at $1,086 this morning although, of course, the Dollar is at 98.35 and that's what's pushing gold lower – not a lack of demand for the metal.
That being said, we've had two winners and one miss in the last few months trying to make 100% on the gold ETF (GLD) spreads and I'm feeling lucky today with GLD at $104 and we should be able to pick up the Aug $102.50/103.50 bull call spread for 0.55 or less and that spread will pay $1 in 14 days (21st) if GLD is over $103.50, which would be about $1,075 on gold.
We're going to grab 10 of those in our $25,000 Portfolio for $550 and, in our Short-Term Portfolio, we can go for 40 for $2,200 and hopefully get back $4,000 (81% profit) if our take on gold works out.
There's a nice way to go into the weekend – have a good one,
– Phil
