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High-Flying Friday – Dow 20,000 in Sight!

Dow 20,000?  

Why not, nothing is out of bounds now that investors have shown they are prepared to accept insane valuations for stocks.  We're still skeptical and very well-hedged (and our hedges are getting crushed) but it's more than offset by the ridiculous gains in our long-term positions so party on Trumpmerica!

As you can see on the chart, we came off the 10,000 line in 2011 rose 75% to 17,500, pulled back to 15,000 (33% retrace) and now we're on the road to 20K in one mighty leap since the election, adding 1,000 points since election day – not even counting the 500-point sell-off that occurred right before the rally began (blow-off spike down).

The 5% line off 18,000 was, of course, 18,900 and you can see we had a brief pause there before shrugging off resistance and heading higher.  The 7.5% line is 19,350 and not too much upside resistance there and then it's a hop, skip and a jump to 20,000 – no problem! 

In fact, the Russell 2,000 is just under 1,350 and that's up 200 points since early November (not counting their spike down) and that is just shy of 15% so the Dow is MILES behind if the move in the Russell is real (we have bet it is not but those bets are killing us!).  The Nasdaq is up 4.3% and the S&P is up 5.5% and the NYSE, the broadest index, is up 4.8% so it's really the Russell that's a huge outlier – and that's why we're shorting it.

HOWEVER, we could be (and have been) very wrong about the Russell and, if so and it heads higher still, then it's the other indexes that should be catching up so we can hedge our hedges with long positions on the Dow, S&P and Nasdaq.  For example, the Dow ETF (DIA) is at $190 so a 5% move in the Dow would be $199.50 and we can make the following play to gain leverage:

  • Buy 30 DIA March $188 calls at $6.70 ($20,100)
  • Sell 30 DIA March $193 calls ar $3.75 ($11,250)
  • Sell 5 AAPL 2019 $97.50 puts for $10 ($5,000)

This spread requires a net cash outlay of $3,750 and the spread pays $15,000 back if the Dow even squeaks higher into March expiration (17th) and you can use any stock for an offset but Apple (AAPL) is a major Dow component and makes a very desireable buy at $97.50 and the margin on 5 short puts is just $5,000 – so it's a very efficient trade that profits $16,250 (433%) if the Dow goes up 2.5% – good deal, right?

A trade like this is especially relevant for those of us short the Russell Futures because, for a very small amount of money, we can insure against further damage from a continuing rally – very cheap insurance – especially if you offset it with a stock you'd REALLY like to own anyway – any of these components would do:  

 &   &   & 
Nov 23 111.23 0.00 0.00% 0.00 0.00 3,731 37,367,800 593.11B Sparkline Chart
Nov 23 149.74 Up 0.22 Up 0.15% 149.03 150.81 3,071,172 3,510,070 92.41B Sparkline Chart
Nov 23 212.31 Up 1.20 Up 0.57% 209.37 213.41 3,734,879 3,158,930 88.92B Sparkline Chart
Nov 23 131.21 Up 0.23 Up 0.18% 130.86 131.99 3,610,508 5,276,210 162.12B Sparkline Chart
Nov 23 161.98 Down 0.69 Down 0.42% 161.36 162.38 2,256,350 3,482,070 154.02B Sparkline Chart
Nov 23 113.07 Up 0.33 Up 0.29% 111.56 113.43 8,467,354 6,826,620 307.61B Sparkline Chart
Nov 23 120.14 Up 0.45 Up 0.38% 119.73 120.76 2,872,059 4,512,730 99.77B Sparkline Chart
Nov 23 172.25 Up 0.34 Up 0.20% 171.76 172.75 1,477,958 1,922,850 103.60B Sparkline Chart
Nov 23 113.07 Up 0.67 Up 0.60% 112.44 113.23 1,004,781 1,771,730 32.12B Sparkline Chart
Nov 23 153.54 Up 1.28 Up 0.84% 150.96 153.74 2,838,847 3,732,240 146.14B Sparkline Chart
AAPL was our stock of the year last year so you know we love them.  We cashed out at $130 so $111 is still a bargain to us and $97.50 is just silly.  IBM was our runner-up for stock of the year in 2016 (we went with the Natural Gas ETF (UNG) instead) but IBM is already up 50% for the year, so it seems like that's pushing our luck.
 
But that brings us back to our problem with the Dow components, they started the year at 16,000 and 19,000 is already up 18.7% and 20,000 would be up 25% which is quite a lot – especially in an economy that is growing at about 3% at best.  Generally, stocks just got much more expensive – but they don't make much more money!
 
Maybe none of that matters as we make America great again and, of course, money has been pouring out of bonds at a breakneck pace with the 20-year note ETF (TLT) dropping 15% off it's highs.  So bonds drop 15% and the ultra-sensitive Russell goes up 15% – makes sense, sort of…

The reason the Russell is outperforming the S&P and other indexes by about 4:1 is because money is indiscriminately flowing into equities and the average Russell component has a market capitalization of $1.8Bn while the average S&P component has a market capitalization of $40Bn so, if a person allocates anything more than 5% of their equity flows to small caps, they will rise disproportionately to large caps.  I'll bet you can see from your own IRA of 401K that you allocate much more than 5% to small caps.

This, of course, also sets them up for a nasty fall if people change their minds and decide to pull money out, which is why we're focused on the Russell as our hedge position – but we never expected this much of a rally.  As noted by the WSJ chart, a big move in biotechs, material and energy companies has also added fuel to the Russell fire.  

OPEC has their big meeting on the 30th (next Wednesday) and, if they fail to come to an agreement, we could see a sharp correction in the energy sector.  There's also still plenty of things to be concerned about (see this morning's news notes) but I don't want to be all doom and gloomy on a holiday weekend – I just want to stick with our hedges but also hedge our hedges for a mall cost – just in case this rally never comes back to Earth.

Spreaking of Earth, here's a really cool chart of how much debt we citizens are all in and keep in mind that's per person, not per family! 

You can see how Japan is an island unto itself and there's Italy, where the possible collapse of the $169Bn Monte dei Paschi bank could severely damage Italy's $1.8Tn GDP.  All of those red countries have very little room to move on policy while, on the bright side – our $20Tn National Debt (103% of GDP) doesn't seem bad at all compared to Japan's 250% so President Trump can spend $20Tn and we still wouldn't make it to the center of that map!

Have a great weekend,

- Phil

 


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  1. Phil, 

    Can you please suggest a current oil and Nat Gas play for a new member? (non Futures)

    thanks 


  2. Hey Phil……Firstly, happy Thanksgiving….I hope you enjoyed the day. What are your thoughts on coffee here? Looks like 150 will be tested and hopefully find support. I´m in March contracts right now.


  3. Good Morning.


  4. Phil

    Rig is buying Transocean Partners LLC (RIGP)

    Do you see any trades in this purchase?

    Thanks


  5. market closes at 1 right?


  6. Phil/TLT – We are short the 2018 $115 puts on TLT in one of the portfolios.   I'm wondering if it would make sense to sell the 2018 $130 calls for $3.60 for additional cover.  Isn't it unlikely that rates plunge again in the next 14 months?  Seems like a good opportunity to sell more premium.  Let me know  thx  


  7. I guess the mkt will never go down… 

    Being a contrarian these days is painful.


  8. @jabo

    You'll get a big sell off if you find out the Russians did hack into the results upon a recount of WI, MI and PA and Hillary Clinton is now the rightful Prez.  So probably not much of a chance of a big correction in near term.


  9. Phil/aapl

     

    Good morning to you!

    Being stock you don't mind owning at $97—any concerns about the Chinese market not panning out for growth? And if so, where do you see growth in iPhone sales coming from? 

    India has not been as much of a story as china was a coup,e of years ago..the money is just not there in India at the ASP's apple sells at. 

    I think we could easily see a 20-30% decline in aapl stock in 2017, perhaps down to $85? One may say that would make it real cheap with $9 in earnings, but we have to remember that the $9 number can change very quickly…with one earnings report. Yes, they have that $35 in cash overseas, but it's a smaller net number now with the $30b or so in debt they have taken on for buy backs and dividends.

    Please share your thoughts…seems like a quiet day


  10. Wow, look at CLF go. 


  11. CLF – I started covering too soon.  Covered some more with the Jan $10 calls.  Wouldn't mind selling some at $10.86 if they get exercised.


  12. Rustle— I don't think the Russians could make TZA stop bleeding… Dangit!


  13. Good morning!

    I hope everyone had a nice holiday but, if you're here this morning – you're a hard-core trader so let's get down to it:

    Oil/Dkot – Well, I'm not expecting the OPEC meeting to amount to much but we still expect UNG to be over $10 into hurricane Season (Oct) next year so I like:

    • Sell 5 LNG 2109 $30 puts for $4.60 ($2,300)
    • Buy 20 UNG 2018 $7 calls for $2 ($4,000)
    • Sell 20 UNG 2018 $10 calls for 0.95 ($1,900) 

    That's a net $200 credit on the $6,000 spread that's $2,000 in the money to start – what's not to love?  Your upside potential is $6,200, which is a 31x return on cash and your obligation is to  buy 500 shares of LNG if they fall 25% to $30 for $15,000 (less your $2,000 credit) and ThinkOrSwim says they only need $1,500 in ordinary margin to cover that trade (and PM would be about $0!).   Actually, might be our Trade of the Year for next year!  

    Coffee/Del – It's a macro call for us based on high consumption and unfavorable growing conditions so we're just into accumulating whenever it's cheap.  Historically, it's cheap anyway. 

    RIG/QC – We're already long RIG, the whole thing is a shell game they played to shed debt and underperforming assets – it's why we liked them in the first place.  It's hard to say it's a good idea to chase them now as they are up 25% from $9 at the start of the month based on speculation of good times that may never come but I do think they're a good value- especially if they re-test $10.

    1pm/Jabob – Yep, half a day.  Or, half a bee – either way I'm happy.  

    TLT/Palotay – I know, so annoying.  We'll have to roll them is all.  Not sure I want to make that move while it's down, I think it's oversold and will drift back up as the Fed tightens but says it's "experimental" or whatever.  As an overall trade, in the OOP, it's the Dec $133 puts we sold for $2.60 but we already cashed in the $140 puts for a $2,300 profit so net $4.90 is our sold price and we break even at $125 and I'm pretty confident we at least hit that on a bounce.

    I don't try to "fix" a trade just because it has a loss – especially if the fix is to take the opposite position.  You WILL have losses in a hedged portfolio – it's impossible not to and, in the OOP, for example, we cashed out the $140 puts on Aug 5th and then the short puts became a hedge.  Since then, the net of the portfolio has gained $30,000 and this happens to be one of the losers – but that's not reason to turn the trade into something it wasn't meant to be. 

    Never/Jabob – I'd like to say never say never but it looks like you're right!  frown  Of course, we though it would be a very low-volume week and Wednesday was 54.7M on SPY, less than half a normal day and the whole week, including today, won't add up to one day's volume on the 9th or 10th so you can look at a meaningless data-point that could be reversed in a day and decide it's the end of the World but I choose to continue to look at the fundamentals and they tell me to stay bearish (but to hedge per the above DIA play – just in case we never do go down).

    Meanwhile, as noted this morning, I added 5 short /TF at 1,344 and we just hit 1,342 for a quick $1,000 and that raises the short basis of my 10 shorts by 1 point so I'm happy.  

    If you are staring at a screen waiting for a 20-point drop to save you – you may have a very, very long wait!

    Recount/Rustle – I don't even dare hope but those statistics are very, very strange.  

    Jill Stein raises nearly $5 million for recount effort

    Why are people giving Jill Stein millions of dollars for an election …

    Stein's fundraising goal was $2.5 million — and donors blew right past it. At that point, as New York magazine first reported, the goal spiked to $4.5 million, and new language on the donation page admitted that costs could rise higher. “The costs associated with recounts are a function of state law,” wrote the Stein campaign. “Attorney's fees are likely to be another $2-3 million, then there are the costs of the statewide recount observers in all three states. The total cost is likely to be $6-7 million.”

    But others have spoken publicly, including the sister of Huma Abedin, Clinton’s closest aide. “A shift of just 55,000 Trump votes to Hillary in PA, MI & WI is all that is needed to win,” Heba Abedin said on Facebook, urging people to call the US justice department to request an audit.

    Chaos is fun!

    AAPL/Maya – A company with a p/e of 13, not including close to half it's market cap in CASH!!! does not need to grow when it's peers are trading at p/e's of 20.  Also, poor economy or not, there are 50M Chinese people who would be considered in the top 20% of the US but there they are the top 4% ($100,000 or more net worth) who can afford IPhones and India is about the same and globally there are about 2Bn solid, potential customers for AAPL phones (and other stuff) and they buy a new phone every 3 years so 700M phones a year and AAPL is selling 218M of them (29%) and, as the phone prices get cheaper – AAPL will enlarge their potential market.  As it is already, an IPhone 5 is generally a give-away phone from most carriers yet it's miles better than most free phones you can get on the intro level.

    As to the $30Bn, yes, that's how they move cash from overseas back to the US without being taxed, they borrow to buy stocks and pay it back through various transfers (shhhh!) so call it $225Bn left overseas ($31/share) instead of $255Bn but, then again, another $10Bn is coming in a month! 

    Just let me know how many shares you will sell me at $85 and I'll be happy to write you a check! 

    CLF/Palotay – Holy cow.  It's funny how long that was a "dead" stock.  Must have gotten 100 FU's from Jabob…


  14. you are wrong— at least 200 FUs Phil!!!


  15. The biggest exchange-traded fund tracking the U.K.’s FTSE 100 Index is seeing a surge in popularity, with traders paying the most since December …


  16. <i>Mathematician and physicist Freeman Dyson has had a career as varied as it has been successful. A former professor of physics at Princeton’s Institute for Advanced Study, he has worked on the unification of the three versions of quantum electrodynamics invented by Richard Feynman, nuclear reactors,</i> …


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  19. Jill stein/ she must feel guilty. She almost nadered Hillary.  Vote for stein was more than trumps margin in Wisconsin Michigan and New Hampshire; but not Pennsylvania. 

    I'm more in line with Jill but had to join the majority. I always felt sick about this election. I'm from pennsyltucky. Could feel the siren call/wall of slime  of the Donald was working. Anyway stein (a doctor) mumbled something sympathetic to the anti vaxxers.  She should know better. 


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  22. Phil That LNG and UNG trade, I think to much Apfelsider yesterday 2109 a bit far in the future and the LNG has 2019 options so why go for 2018?


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  28. Saudi Arabia has pulled out of talks with non-OPEC producers including Russia planned for Monday because the exporters’ group still has no internal …


  29. The flood of “fake news” this election season got support from a sophisticated Russian propaganda campaign that created and spread misleading articles online with the goal of punishing Democrat Hillary Clinton, helping Republican Donald Trump and undermining faith in American democracy, say …


  30. Phil again ( I lost my comments) possible to much Apfelsider yesterday but the UNG LNG LNG no 2109 trades to far in the future and why don't we not take the UNG 2019 play 7/10 cost 1.00 and the 2019 LNG credit 4.30 on the 30put?


  31. Phil/

     

    Aapl: I see that rational side too…it's just that the media sees 'lack of new products', 'lack of innovation' 'stagnation in iPhone unit sales', 'first ever year over year decline in growth'….

    So, after last earnings report for instance, we saw disappointment rule the stock price. the low PE, has been low forever as there is no conviction in the company.

    So one does run the risk of sentiment beating out fundamentals, even long term and especially in aapl's case!


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  37. The future of oil

    The world’s use of oil is approaching a tipping-point, writes Henry Tricks. But don’t expect it to end imminently<p>AT THE TURN of the 20th century, the …


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    You don't know hardcore until you've seen "Hardcore Henry."
    https://www.youtube.com/watch?v=96EChBYVFhU


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  51. JO weakening again…

    Any new play that you would recommend?


  52. Phil,  thanks for the article on Freeman Dyson.  Sort of like being in the room with him and having a conversation.  Have a great week end everyone.


  53. FUs/Jabob – You're probably right, we need a counter.  cool

    Election/Rexx – On the whole, I'd rather move on but, if there's a chance of stopping this tragedy before it starts – it's worth looking at!   I like the thing with the electoral college – this election isn't really official until the 19th!

    LNG/Yodi – Well, logically, if you can sell the 2019 $30 puts for $4.60, then the 2109 $30 puts should be about $400 – that would seem worth selling!  Hey, I think I just figured out why it's so easy for us to make money – those short put sales really add up over time!  cheeky

    I wonder if we could back-test selling short puts against all Dow components 10% below the money, every two years for 20 years?  Would be an interesting number.  

    Anyway, yes, that is what we're doing, I just changed the mix because, if /NG does collapse – we might not want to own so much LNG and, of course, no sense being greedy when you can make 3,100% in two years.

    AAPL/Maya – Yes, but the media is neither buying or selling AAPL stock – I am.  The media also tells me I should be driving a tough Ford truck and eating at Arby's – plenty of things I don't listen to over there!  If you trade based on the PRICE of a stock – then AAPL may not be for you but I buy a stock for the VALUE and, if it gets cheap – I buy more.  Generally, over time, it tends to work out (see CLF, FCX…) and I sure feel much better sleeping at night with value stocks in my portfolio.

    Wow, oil really collapsing, taking /RB with it – glad we cashed out!  

    And honey badger, he don't care….

    Might be us buying, of course.

    Frigging Russell again:

    JO/Jabob – Not without reading up some more and trying to figure out what's going on.  I'm not on top of ag futures enough to be sure there's nothing to worry about – so I worry.  Remind me Sunday afternoon when I'm back and I'll try to do a bit more reading.

    Dyson/Newt – I love hearing what smart people have to say.


  54. thanks Phil..

    looks like 15 in a row for the RUT..

    FU ME!!!!!!!!!!


  55. Jabob – I just joined you in some TZA.  Even the proverbial dead cat bounces when thrown down the stairs ! ! ! 8-)


  56. Black Friday Reports?  I'm ensconced again at my mountain-top island retreat, but coming home from Thanksgiving with family yesterday saw that the parking lots for all the malls, mega-walmarts, and outlet malls along the highway were PACKED by 7pm. Had to catch a ferry though, so just couldn't stop to find out what great deals we were missing…


  57. Crazy option pricing on CLF today. My position jumps from -$6K to +$4K and back again several times today already!


  58. albo…I keep waiting for the dead cat..

    Unlike CLF and FCX..

    TZA is never going to recover long term.. What a POS fund!


  59. TZA – jabo – please tell us when you capitulate!


  60. Well, the 3X leverage doesn't help.


  61. I guess a good lesson is never assume that people will want to take $$$ off the table regardless of how crazy the run seems.


  62. LOL Scott – that's the signal.

    Leverage/Albo – Yep, 3x leverage 15 days in a row is going to add up to something.  

    Jabob, you should have put the money in TNA:

    Up almost 50% is actually doing better than TZA is doing badly, maybe TNA makes a good short now?  At least that way, the decay is in your favor.

    TNA 2018 $110 puts are $29 and the $80 puts are $15.50 so net $13.50 on the $30 spread is an interesting play.

     Lesson/Jabob – "The market can remain irrational longer than you or I can remain solvent." – Keynes. 


  63. Albo,

    Just look at it as car insurance it runs out every year TZA and thank God you still alive.


  64. Yodi – Good point.


  65. Phil – You're right about TNA.  Better play.

    Have a great weekend !


  66. Well, that was a nice short day – they should do that every day. 

    Some commodity pits used to only trade for an hour a day – that was the life!  

    SPY volume down around 30M and they are punching us up into the close – just because they can.

    Have a good weekend folks,

    - Phil


  67. CONFERENCE/Vegas

    I have interest from about 15 people so far. 

    Thank you to all that emailed me

    I am trying to arrange the meeting for the weekend of Feb 18-20 in Vegas.

    Requests have been sent to Caesars, Mandarin Oriental as well as Four Seasons. Waiting to hear back

    regarding rates and availability

    If we cannot get the weekend of 18th, will try for the 11th of Feb.

    Additional details to follow!


  68.  Check with Greg, we have a show in New York in February. It certainly can't be that weekend and the weekend after it would be very tight for me. 


  69. Maya1 / Vegas

    What is the main theme or the topics that are planned to be reviewed at a Vegas PSW Conference?  


  70. Jabob FUs/Phil – counter, hell, we need graphs. Plot over time, stock specific….our very own TA indicator. Check this one against your favorite, Hanjongin.  ;)


  71. Phil/greg

    Greg DID TELL ME the NYC Tradeers show over the Feb 25th weekend and also said the following weekend was also off limites(march 5th weekend)

    So, I am trying for the Feb 18 weekend, and failing that, Feb 11 weekend.


  72. GClay/Vegas

    Topics will be at Phil's discretion solely. If this works out, I guess we will hear from Phil.

    We are at the beginning stage of planning. Have narrowed it down to two weekends in Feb.

    Trying to get prices from hotels to see what it will cost our group and depending number of people  price per person will be determined.

    I hope that helps?


  73. CONFERENCE/Vegas/ Feb 11 vs 18

    Well, we have the Presidents' Day holiday on Monday Feb 21 and markets are closed.

    So, if Phil was planning on live trading then we have to have the CONFERENCE on Feb 11 weekend.

    Phil?


  74. Policymakers are on the hunt for capital outflows disguised as foreign investment.<p>China’s central bank has urged commercial banks in Shanghai to guard against money outflows via the Shanghai Free Trade Zone (FTZ) disguised as foreign investment, two sources with knowledge of the instructions said …


  75. LONDON — The controversial leader of Hungary who erected a fence along his country’s border to keep migrants out says Donald Trump has invited him to visit Washington.<p>Prime Minister Viktor Orban said in an interview published online by business daily Vilaggazdasag that Trump made it clear to him …


  76. China’s trade figures continue to disappoint. Having shown a promising uptick in August, after spending the year in negative territory, September and October both again show solid reductions on the previous year. This is particularly so for exports, but also the case for imports, further confirming …


  77. It might seem disingenuous to pose such a question: Could Saudi Arabia, OPEC’s de facto leader, undo much of its public relations and media spinning work over the past year trying to convince global oil markets that indeed a much needed oil production cut is on the horizon and walk away from …


  78. As reported yesterday, India’s unexpected crackdown on “black money” which saw the elimination of the old high denomination bills, is not going well, …


  79. S&P 500 Targeting 2260

    Markets are overbought, but this does not preclude an additional move higher.<p>There are specific technical levels for traders to target on the S&P 500.<p>…


  80. LONDON (Reuters) – After a number of false starts since the term was first coined five years ago, the idea of a ‘Great Rotation’ out of bonds into stocks is again gaining traction.<p>Almost $2 trillion has been wiped off the value of global bonds since Donald Trump was elected as the next U.S. …


  81. They still face prosecution over foreign exchange contracts for the Malaysian ringgit.<p>Two Australian banks have offered to pay fines for “cartel conduct” when trading foreign exchange contracts for the Malaysian ringgit, in the latest controversy engulfing banks and their manipulation of foreign …


  82. There is a key metric that shows just how out of control property prices are in London are right now — the price-to-earnings ratio.<p>According to housing research group Hometrack, the price-to-earnings ratio in London is now at 14.2x. Basically, this means that the average property buyer in Britain’s …


  83. <b>(CNN) —</b> A legal tug-of-war between Ugandan authorities and a for-profit international chain of schools has led to the education provider being ordered to shut down in a matter of weeks, leaving the lives of thousands of pupils in limbo.<p>Uganda’s High Court has described the Bridge International …



  84. PSW/Portfolio tracking

    The virtual portfolios are tracked through power options correct?  Does anyone use them for their personal ports, or any other services/sites useful?


  85. Phil I am curious if you have any opinion on how oil will be manipulated this week with the OPEC meeting. My gut feeling is that they will be making positive noises and announce some kind of production cut deal that will send oil higher but of course we also know that any deal will end up falling apart as they cannot really enforce it. I just don't think they will let oil drop to $30 again with no deal. I don't think I will want to be trading on a gut feeling with potential losses of a large magnitude, but am curious what you think anyway just for fun in a paper trade. Thanks Phil. 

    I am also curious if you think that coffee will start to move higher again after the holiday. I started taking long positions as it dropped and would love to see $160 again to make a nice haul with my cost at about $157.


  86. Forecasting The Next Recession Based On The Calendar And The Presidency

    It's worth stressing that the timing of each recession has little to do with the election of a new president.  Before Truman, at least one recession began during every presidency. Since then, there have been 5 presidencies where a recession never started after their election until they left office 


  87. On Friday, after reading the latest shift in the every changing, always fluid OPEC narrative, according to which Saudi Arabia was demanding Iranian …


  88. I recently purchased an accessory for a phone that required assembly instructions. Unfortunately, the English instructions were unintelligible—incorrect grammar, missing words, sentence fragments, etc.<p>Last month, I received an offer for a credit card—which I already have and regularly use—that was …


  89. Your 20s are, at least according to one psychologist, the “defining decade,” because they play a huge role in who you’ll become personally and professionally.<p>So don’t screw them up!<p>We’re only kidding — you’ll definitely screw them up in some capacity, and that’s okay.<p>If you can make at least some …


  90. Diplomats who gathered earlier this month in Marrakech, Morocco for COP22, the United Nations climate change summit, already faced a difficult proposition: how to fine-tune and implement the international agreement on climate change drafted last year in Paris.<p>The election of Donald Trump as the …


  91. 16 paradoxes that will make your head explode

    “I know one thing,” Socrates famously said: “that I know nothing.”<p>This statement is a paradox in itself, demonstrating the complexities of self-referential statements, but it also suggests a crucial insight from one of the founders of Western philosophy: You should question everything you think you …


  92. ‘You Hacked, ALL Data Encrypted’<p>San Francisco Municipal Railway riders got an unexpected surprise this weekend after the system’s computerized fare systems were apparently hacked. According to the <i>San Francisco Examiner</i>, the MUNI system had been attacked on Friday afternoon.<p>MUNI riders were greeted …


  93. CARACAS, Venezuela — It’s not so easy to find someone who still uses a wallet in Venezuela, where inflation is expected to reach 720 percent this year and the biggest bill — 100 bolivars — is worth about 5 U.S. cents on the black market.<p>The currency has dropped dramatically in value as Venezuela’s …


  94. The surgeon general’s new approach on substance abuse has policy implications for law enforcement.<p>For the first time ever, a sitting U.S. surgeon general has declared substance abuse a public-health crisis. “It’s time to change how we view addiction,” Vivek Murthy said in a statement last week, …


  95. The IRS has issued a summons for data on millions of users of the bitcoin exchange Coinbase, but some are dismayed by sweeping nature of the request<p>A US government request to trawl through the personal data of millions of users of the cryptocurrency exchange Coinbase signals the start of an effort …


  96. LOS ANGELES — With the mega-arrival of “Moana” over the holiday weekend, the reinvigorated Walt Disney Animation Studios cemented its status as cartoon-dom’s reigning powerhouse for non-sequel films.<p>“Moana,” one of the best-reviewed wide releases of the year, collected about $81.1 million at …


  97. PALM BEACH, Fla./WASHINGTON (Reuters) – U.S. President-elect Donald Trump tweeted on Sunday that<p>besides winning the Electoral College “in a landslide” in the Nov. 8 election: “I won the popular vote if you deduct the millions of people who voted illegally.”<p>The allegation, made without evidence, …


  98. Italian olive farmers face disastrous harvest

    For about 10 days every November, Arrigo Peri, a Rome orthodontist, closes his dental practice, drives to Puglia, in the heel of Italy, and indulges his passion – olives.<p>“Making olive oil is like making wine,” he says. “It’s like being an artist.”<p>But this year, artistry gave way to misery. The …


  99. Outstanding loans have risen sharply to 40% of GDP but analysts fear the end of the credit binge could trigger a crisis for the wider world<p>Chinese household debt has risen at an “alarming” pace as property values have soared, analysts have said, raising the risk that a real estate downturn could …


  100. AMSTERDAM (Reuters) – Royal Dutch Shell expects to pump out all the fossil fuel reserves listed on its balance sheet, its chief executive said, dismissing concerns that production limits in the wake of the Paris climate accord could hit the energy giant’s valuation.<p>In an interview with Dutch …


  101. Why journalistic ‘balance’ is failing the public

    Renowned reporter Christiane Amanpour recently told a conference of the Committee to Protect Journalists that they should aim for truth over neutrality.<p>Watching the recent US presidential campaign unfold, she said she was “shocked by the exceptionally high bar put before one candidate and the …


  102. Daimler has been fleshing out its electric vehicle strategy over the last year and a big part of it came to life in Paris earlier this year with the unveiling of Mercedes’s new ‘EQ’ brand and the first vehicle under that electric brand: ‘Generation EQ’.<p>The German automaker admitted that it fell …


  103. Without a policy announcement, China’s central bank has effectively tightened monetary conditions in recent weeks, an analysis of its transactions …


  104. CNN/ORC poll: A nation divided, and is it ever

    <b>(CNN) —</b> After a bruising presidential election featuring the two least liked major-party candidates in recent history, more than 8-in-10 Americans say the country is more deeply divided on major issues this year than in the past several years, according to a new CNN/ORC poll. And more than half say …


  105. Warren Buffett once said, “Our favorite holding period is forever.”Many <b>CVS Health</b> (NYSE: CVS) shareholders probably bought the healthcare giant’s stock thinking that they might be able to buy and never sell.But even Buffett has sold his fair share of stocks well before forever arrived. Is it time …


  106. A massive stock market rally is on our doorstep according to several noted economists and distinguished investors.<p>Ron Baron, CEO of Baron Capital, is …


  107. <i>From Marc Hanson of M Hanson Advisors</i><p><b>Houses have NEVER BEEN MORE EXPENSIVE to end-user, mortgage-needing shelter buyers</b>. The recent rate surge …


  108. Online Thanksgiving Day sales totaled $1.93 billion<p>Black Friday is setting new records online.<p>Online sales on Black Friday will hit $3.05 billion, up 11.3% on last year, and surpassing the $3 billion mark for the first time, according to estimates from software company Adobe Digital Index. That’s …


  109. by williambanzai7 – Nov 25, 2016 12:35 PM<p>Boycott Amazon…<p>American Pravda<p>by Sprott Money – Nov 25, 2016 11:21 AM<p>Although we cannot predict how far …


  110. People’s Bank of China Deputy Governor Yi Gang said the country has “very adequate” foreign reserves and the yuan remains strong compared with the …


  111. Indian stocks fluctuated between gains and losses as lenders offset an advance in energy companies and metal makers.<p>State Bank of India tumbled for a …


  112. HONG KONG — Global investors in two weeks will get direct access for the first time to the stock market in the Chinese city of Shenzhen, giving them a chance to bet on a tech-heavy clutch of private companies on an exchange sometimes called China’s Nasdaq.<p>But many investors will be skeptical, and …


  113. China risks wasting $490 billion by building more coal power plants than it needs as slower power demand growth and less polluting energy sources …


  114. The presidential election may signal big changes to the way is finance is regulated<p>BEFORE the presidential election, Wall Street dreaded Donald Trump …


  115. Businesses in the U.K. service sector are increasingly pessimistic about the future as sales slow and costs rise, according to the Confederation of …


  116. SEATTLE–Amazon.com Inc.’s first cloud-computing conference in 2011 was a curiosity. Many of its 6,000 attendees worked for startups that had chosen to buy access to processing power and data storage via the web from Amazon Web Services rather than own and maintain their own data centers.<p>With the …


  117. There’s a Chinese saying that stems from the philosophy in Sun Tzu’s ancient text “The Art of War”: You can kill 1,000 enemies, but you would also …


  118. OPEC is embarking on a last-ditch diplomatic push to reach an agreement for an oil production cut, with the oil ministers of Algeria and Venezuela …


  119. Dow 19000 was nice, but Dow 20000 is the real milestone to watch and maybe even fret about.<p>The Dow Jones Industrial Average is roughly 5% away from reaching the next millennium marker. If history is a guide, it probably won’t be a straight shot getting there. But when the Dow hits 20000, holding …


  120. REPORT: Samsung might split itself in two

    SEOUL (Reuters) – South Korea’s Samsung Electronics Co Ltd will consider splitting itself into two as proposed by U.S. activist hedge fund Elliott Management, Seoul Economic Daily reported on Monday citing an unnamed source.<p>A split would allow the heirs of the founding Lee family to strengthen …


  121. Policy pledges by U.S. President-elect Donald Trump are bullish for Japanese share prices, which will build on their recent gains in 2017, according …


  122. The Engine of Inequality: Privilege

    <i>November 28, 2016</i><p><i>This is what we’re up against: a status quo that has institutionalized soaring inequality and rising poverty as the only possible</i> …


  123. China’s zombie companies can rest easy. It’s a shame the same can’t be said for investors in the nation’s banks.<p>The big five lenders, starting with …


  124. Well, that escalated quickly.<p>Global reflation and a stronger US dollar are the reasons to go long Japanese equities, according to Morgan …


  125. Copper’s recent surge appears to be built upon sand.<p>Normally, when commodity prices jump — and LME copper is up 21 percent this month — it’s …


  126. The 30 Highest-Paid Celebrities Under 30 In 2016

    Taylor Alison Swift was born on Dec. 13, 1989 in Reading, Pennsylvania. Thanks to her album and tour named after the year of her birth, the 26-year-old pop superstar banked $170 million in a year, which makes her the top-earning celebrity in the world.<p>Swift’s 1989 tour grossed $200 million in North …


  127. Dollar weakens vs. yen, other currencies amid oil-production uncertainty<p>The dollar weakened sharply against the yen and other currencies in Asia trade Monday as renewed uncertainty over the direction of oil production amplified a selloff after a post-U.S. election surge.<p>The U.S. currency fell more …


  128. Every investor should keep an eye on these 7 “post-Trump” world events<p>Lampooning Larry Kudlow is like shooting fish in a supermarket. I ought to be …


  129. Good morning!

    We had a nice sell-off going for a while but it reversed on the EU open but I can't see how this rally hasn't exhausted itself.  

    Still, last 3 trading days of the month and an OPEC meeting mean anything can happen and probably will.  The calendar is busy with a lot of data and 7 Fed speakers ahead of next week's Fed meeting and GDP tomorrow may be lower than the 2.9% estimate last time and, of course, Non-Farm Payrolls on Friday:

    Futures are at 19,100, 2,205, 4,860 and 1,345 (/NKD is 18,300) and of course I still like shorting the Russell as they've been up for 15 days but it's like looking at a roulette wheel that's come up red 15 times in a row – it seems like black is a good bet but why buck the trend and, in the end, it's a gambler's fallacy as either one is exactly as likely to happen on the next spin.

    The Dol;lar is 101.10, a bit lower than Friday's 101.5, oil is $46 after testing $45, /RB back to $1.377 and /NG $3.18 holding up very well.  Gold popped back to $1,191.

    And, don't forget – there IS a recount going on and that's going to cause uncertainty – even though it's not likely to change anything.

    Trump responds to recount efforts

    • The Clinton campaign is backing Green Party candidate Jill Stein's efforts to take a fresh look at voting results, stating it planned be a participant in recounts in Wisconsin, Pennsylvania, and Michigan.
    • President-elect Donald Trump called the decision a "scam" and "nothing would change," claiming that he won the popular vote as well as the electoral college if "the millions of people who voted illegally" were deducted.

    Trump quotes Hillary Clinton, rages against Wisconsin recount effort in hours-long tweetstorm

    Clinton to take part in recounts

    • Taking pains to try and appear to be keeping the whole affair at arms length, the Clinton campaign nevertheless says it plans to be a participant in recounts in Wisconsin, Pennsylvania, and Michigan.
    • From a blog post from Clinton campaign lawyer Marc Elias: "Because we had not uncovered any actionable evidence of hacking or outside attempts to alter the voting technology, we had not planned to exercise this option ourselves, but now that a recount has been initiated in Wisconsin, we intend to participate in order to ensure the process proceeds in a manner that is fair to all sides."
    • Green Party candidate Jill Stein says she's nearly raised all of her $7M goal needed to initiate recounts in those three battleground states (she's already done so in Wisconsin).
    • Trump's combined margin of victory in the three states was 107K votes, and while Elias says the campaign doesn't think that can be overcome, "we have an obligation" to those who cast ballots for HRC.

    Trump trades give in to gravity

    • Trades that performed best in the three weeks since Donald Trump's election victory are taking a breather, with the dollar and U.S. bond yields falling from recent peaks and equity index futures signaling stocks will slip from all-time highs.
    • The dollar could face further resistance in the week ahead given potentially risk-laden events such as the midweek OPEC meeting and Italy's Dec. 4 referendum on constitutional reforms.

    Industrial profits accelerate in China

    • Profit at industrial companies in China picked up last month as prices recovered, but growth was skewed towards high-polluting heavy industry.
    • According to the National Bureau of Statistics, profits in October rose 9.8% to 616.1B yuan ($89.1B).
    • The biggest gains were seen in the traditional raw material production sector and smaller returns in high technology and equipment manufacturing.

    Up To Eight Italian Banks May Fail If Renzi Loses Referendum

    This is what Europe's biggest bank expects from Italy's crucial referendum

    Italy needs reform and a euro exit is inevitable

    US Housing Market In Peril As "Increase In Mortgage Rates Has Shocked Consumers"

    Black Friday Sales Slump As Retail Tracker Admits Holiday Season "Off To A Slow Start", Blames Warm Weather

    Retail wars continue on Cyber Monday

    • ShopperTrak reports a 1% drop in store visits during the two-day period covering Thanksgiving and Black Friday.
    • The slight dip in traffic was largely anticipated as e-commerce growth continues to soar. Online sales for the Black Friday to Thanksgiving time frame were up 17.7% to $5.27B, according to an estimate from Adobe.
    • The Super Bowl of online shopping starts at midnight. The National Retail Federation expects 122M Americans to shop online tomorrow on Cyber Monday vs. 121M last year.
    • Early analysis indicates that Wal-Mart (NYSE:WMT) through its Jet.com add-on and Target (NYSE:TGT) via hard-hitting promotions are significant players in keeping up with Amazon online this holiday season.
    • Previously: Black Friday wrap: Records fall, retail winners and losers (Nov. 25)

    Black Friday online sales forecast to top $3B

    • Adobe estimates online Black Friday sales will top $3B for the first time as they rise 11.5% to $3.05B.
    • The firm also says that today could be the first day in retail history that $1B in sales will be generated by mobile devices.
    • Source: Bloomberg

    Black Friday Shoppers Curb Spending as They Chase Discounts. Holiday shoppers spent less money over the Black Friday weekend than in 2015, another sign that U.S. consumers remain wary about opening their wallets without deep discounts. Shoppers spent an average of $289.19 over the four-day weekend, including both online and offline purchases, the National Retail Federation said on Sunday, citing a survey conducted by Prosper Insights & Analytics. Consumers shelled out $299.60 in 2015, the trade group found. The weekend was characterized by heavy markdowns and a shift toward e-commerce, meaning there were smaller crowds at the mall. Forty-four percent of consumers did their shopping online, compared with 40 percent at brick-and-mortar stores. In either case, many of them were looking for just one thing: a good deal.

    Investment firms weigh in on Black Friday standouts

    • KeyBanc calls Amazon (AMZN -0.1%) and Wal-Mart (WMT +0.7%) early winners of the Black Friday shopping period based on channel checks.
    • The investment firm confirms other reports that mall traffic is light. Within the mall sector, Lululemon (LULU +0.2%), Victoria's Secret (NYSE:LB) and Gaps (GPS -1.4%) are called outperformers – while concerns are raised over Buckle (BKE +0.6%) and Vera Bradley (VRA +0.8%).
    • Cowen also sees Wal-Mart as a winner. Pink (LB) and American Eagle Outfitters (AEO+0.2%) are also doing wel, according to analyst Olivia Chen.
    • MKM Partners has an eye on margins. The combination of "virtually all" retailers offering broad discounts on store assortment and a low level of inventory heading into the shopping period is striking.
    • FBR Capital reiterates the broad theme that online sales are diluting Black Friday store traffic. Despite the overhang – Carter's (CRI +0.2%), Hanesbrands (HBI -0.3%), Chico's (CHS +0.7%) and Children's Place (PLCE +1.3%) are called out by FBR as standouts.
    • #BlackFriday

    Energy stocks on watch with OPEC mania

    • Oil prices are bouncing around the $46 level as traders bet on whether OPEC will slash output at its closely watched meeting on Wednesday.
    • While Libya has announced it won't take part in any OPEC cuts and Saudi Arabia hinted that the oil market would rebalance itself, some still feel the group will be able to rein in global oversupply.
    • Venezuela's oil minister will also meet his Algerian counterpart later today before the two meet with Russia to seek support for a production cut.


    OPEC deal to set market tone this week

    • A deal on Wednesday that delivers a concrete supply reduction of at least 1M barrels a day, with non-members such as Russia on board could boost oil beyond its recent $40-$50 range.
    • News before the weekend stating Saudi Arabia wouldn't attend a gathering with non-OPEC producers on Monday prompted a significant pullback, but crude prices could bounce around over the next few days as the group tries to resolve internal differences.
    • Tomorrow's talks will be converted into another OPEC-only meeting, sources toldReuters.

    Even If OPEC Gets a Deal, It Risks Reviving Battered Oil Rivals. Three days from a crucial meeting, OPEC’s deal to curb oil production and end years of global oversupply hangs in the balance. But even if ministers hash out a meaningful accord on Wednesday, there are dangers for the oil-exporter club. For two years, OPEC tried to bury a growing army of upstart producers by flooding the markets with crude. Reversing course might hand a lifeline to the battered survivors like Premier Oil Plc who are rushing to reap the rewards. The London-listed company, whose 60,000 barrels a day of output amounts to a rounding error for OPEC, expects to use hedges to lock in 2017 prices of at least $50 a barrel, a level Brent has only touched briefly this year. That means Premier Oil has adapted well enough to the assault to at least break even at half the price it received on the futures market in 2015.??

    Oil Industry Anticipates Day of ReckoningProspect of ‘peak demand’ prompts debate and long-term planning by global producers.

    An OPEC deal won't fix the oil glut

    Alberta to pay three power companies $1.36B to shut coal-fired plants early

    • Alberta's government says it will pay C$1.36B to three coal-fired electric generating companies – TransAlta (NYSE:TAC), Capital Power (OTC:CPXWF) and Atco (OTC:ACLTF) – for the province’s decision to close their plants early.
    • The government will pay a combined $97M/year, starting next year and continuing for every year until 2030, to shut down six of the companies' 18 power plants, with the other 12 plants in the province scheduled to close or convert to natural gas before 2030.
    • Alberta has said the changes it is making to the electricity market are needed to attract new, greener power plants in the province to offset the mandated closure of coal-fired generating stations by 2030.

    Carmakers on course to miss CO2 targets

    • Eight of Europe's largest carmakers are on course to miss carbon dioxide emissions targets that come into force in 2021, leaving them facing the prospect of billions of euros in fines.
    • Only four of the 12 largest companies – Peugeot Citroen (OTCPK:PEUGF), Toyota (NYSE:TM), Renault-Nissan (OTC:RNSDFOTCPK:NSANF) and Volvo (OTCPK:GELYF) – are on track to hit incoming EU goals, according to PA Consulting group, which advises many of the companies on manufacturing and technology.

    U.S. auto sales forecast to set a record in November

    • U.S. automobile sales are expected to increase 4.2% to a record 1.37M units in November, according to a forecast from Kelley Blue Book. The previous high for the month was 1.32M units.
    • This November includes two extra selling days than last year which provides an obvious boost. A high level of promotions around the Black Friday weekend is also seen as a sales driver.
    • KBB's forecast by automaker: General Motors (NYSE:GM) +8.6% to 249K, Toyota (NYSE:TM) +2.9% to 195K, Ford (NYSE:F) +0.1% to 187K, Fiat Chrysler Automobiles (NYSE:FCAU) -4.5% to 168K, Honda (NYSE:HMC) +9.1% to 126K, Nissan (OTCPK:NSANY) +8.3% to 116K, Hyundai-Kia (OTC:HYMLF) +7.0% to 113K, Subaru (OTCPK:FUJHY) +15.0% to 53K, Volkswagen (OTCPK:VLKAY) +5.5% to 47.5K.
    • Tesla Motors (NASDAQ:TSLA) isn't running up the volume quite yet to make the KBB list, but that is expected to change in 2017.

    China’s Ball of Money Is Rolling Back to Commodities. In China, money flow is tightly controlled and capital markets are relatively underdeveloped, meaning the economy works like squeezing a balloon. You press it in one place, and it bulges in another. Policy-maker moves to cool one expansion only serve to inflate another. Now that "gyration of bubbles," according to Société Générale SA’s chief China economist Wei Yao, has been heating up the commodities market again.

    Microsoft escalating emphasis on cloud services in China

    Everything Goldman Sachs predicts for 2017 — in one chart


  130. Vegas/Maya – The markets are closed on Washington's Bday (20th), not 21st but I'm not thrilled with that week anyway as I have to do the NY conference the next week.  Feb 11, 12, 13 sounds good.

    Vegas/GC – It's not really a theme.  We do a live seminar, like our Webinar, on Sunday for 4-5 hours where we discuss trading, strategies, stock ideas, etc. and then, on Monday, we look to put some things to work in a live trading workshop during market hours.  Since it's Vegas, that's from 6:30 am until 1pm on Monday.

    PowerOptions/Jeff – There's a free trial and, if you tell them you are with PSW, I think they give you a whole month to play with it.

    Oil/Craigs – It's not so much manipulation now as we'll finally have some FACTS to play with.  See above for current news notes.  I think no deal or lame deal and oil prices plunge – same thing we thought would happen after Thanksgiving anyway.  Any kind of deal may get a pop we can short into.  And yes, too crazy to play at the moment.

    Coffee/Craigs – We're playing coffee on macro issues regarding global warming trends and long-term crop damage and you want to know what will happen next week?  Sorry, no idea.  Coffee is not oil – it's not a manipulated market where you can see strings being pulled – it's up to God and you need to be in or out for the long haul.  

    Italy just had the worst olive harvest in decades due to climate change – if that's any indication of troubles to come. 

    Dollar/Pstas – I agree, over the long-term, it matters very little, it's the short-term correlation that's strong.


  131. /KC- Phil where's that crystal ball you have for these questions? So, I get that the play is on macro issues and is a long haul trade, but is there no rhyme or reason why it pops to 175 from 150 and then comes back to 155ish? I guess from your answer that there is not, but it seems that 150 is a good entry and in this case it probably didn't hurt to start poking at 155 and see if we don't get any pop from there. I also see that it could drop further, but that if we are willing to hold on we should see upside at some point in the not too distant future. I wasn't really looking for next week, just wondering if you would agree that poking long at 155 might be a worthwhile trade?


  132. craigs, as long as you are comfortable with 1x at 155, 2x at 150 (after being down $1875), and then 4x at 145 (after being down another $3750).

    with margin of 3630, need to have ~$20K to gamble (margin plus loss).  but you'd be even at $148.75.

    how's that for a phil-like plan?