Posts Tagged ‘SOX’

Monday – “Markets in Turmoil” According to CNBC – Must be Time to Buy!

What a fantastic contrary indicator!

CNBC hit the panic button this weekend with their "Markets in Turmoil" special report where they trot out their crisis team of Jim Cramer and Maria Bartiromo in an attempt to stampede all the remaining sheeple out of the markets on Monday Morning (see our Friday morning post for our view on why we thought Friday's drop was going to be a bear trap).

"An awful May is replaced by the start of a frightening June" is CNBC's opening voice over and it gets dumber and dumber from there as "America's Financial News Network" bangs the fear drum right at Asia's open (9pm) and then uses the panic in Asia to prove their point to EU and US traders that there's something to worry about.  

I could go on and on about how ridiculously evil this network is and how horrible it is that we allow these Financial propaganda networks to manipulate the markets to the benefit of the highest bidder but, in the long run – who cares?  If you watch CNBC and take it seriously – just like people who watch Fox to find out what's going on in the World – you reap what crap you have sown.  

SPY DAILYWe are not, in any way, gung-ho bullish but we're also not going to play bearish.  On the whole, as we reviewed in this week's Stock World Weekly (available free this week!) - we are "wishy washy" in our positions, cashy and cautious and doing just a bit of bottom-fishing as we HOPE (not a valid investing strategy) that this is the bottom as we HOPE the G8 takes some rational action.

We made a bullish play on the Futures at 9:13 last night, while CNBC was clearing out all the suckers at Dow (/YM) 12,000 but we took that money and ran as we popped over 12,075 (up $375 per contract) early this morning and flipped to a bullish play on oil (/CL) off the $82 line and those contracts are already $82.40 – up $400 per contract at 8am.  

We were also very excited to see AAPL back at our buy point of $555 early this morning as AAPL is pure rocket fuel for the Nasdaq when it bounces and AAPL can move quickly back to $580 on any hint of…
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Goldilocks and the 300,000,000 Bears

Talk about feeling outnumbered!

As the guy in Airplane kind of said – "Looks like I pricked the wrong week to get bullish!"  Of course, as I often tell people I am neither bullish nor bearish – I'm rangeish – and our range is the 5% band between around Dow 10,200 and S&P 1,070, which takes us as low as Dow 9,690 and S&P 1,016 and as high as Dow 10,710 and S&P 1,123 before I really "flip flop" my positions.  Despite the fact that this is the range we predicted last October and is the range we've been in (other than a brief trip to 11,200, which we shorted the hell out of) all year – people still seem to find it necessary to call me either bullish or bearish as we navigate the channel.

I suppose I have been HOPEFUL for the month (now heading into day 14) that we will finally make a little progress and establish a higher floor at our usual mid-points while, at the same time, the MSM have decided that we are all going to die.  That does make me kind of bullish by comparison doesn't it?  We are mainly in cash and we are well hedged to the downside so, unless we are REALLY heading much, much lower, there is little profit in speculating to the downside, other than our quick trades.  As PT Barnum once said:

"A man who is all caution, will never dare to take hold and be successful; and a man who is all boldness, is merely reckless, and must eventually fail. A man may go on "’change" and make fifty, or one hundred thousand dollars in speculating in stocks, at a single operation. But if he has simple boldness without caution, it is mere chance, and what he gains to-day he will lose to-morrow. You must have both the caution and the boldness, to insure success." 

Balance is the key to long-term success and we've had many conversations about that in Member Chat.  Our goal is to be neither bullish or bearish but rather to sell premium to both the bulls and the bears when conditions permit us.  As Ravalos said Friday in Member Chat:

"Ever since I became member (actually before I became member I


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Global Chart Reveiw Shows Key Inflection Point

Chart Review by Michael Clark

“By a continuing process of inflation, government can confiscate, secretly and unobserved, an important part of the wealth of their citizens.”

    -- John Maynard Keynes

SO, IS THIS FINALLY THE 'REAL' CORRECTION?

What a week it was.  The Bears gave the Bulls some payback.  Obama got a wake-up call.  And the banks got a well-deserved scare (and we hope they will get a well-deserved hair cut).

The markets reacted, as one might expect, with selling.  Actually, the selling began before the Massachusetts election and before Obama sent a shot across the Goldman Sach's bow.  Last week Intel announced surprisingly strong earnings; and the stock started up and then sank.  For the past half-year investor behavior had been the reverse: a buying spree for any stock that did not lose as much as it might have — beating 'Street expectations' that had been dumbed down over and over again during a quarter so that the company could report 'surprising' strength.  Suddenly, now, even good earnings are being greeted with selling.  Then came Massachusetts — wasn't that a Bee Gees' song?
 

All the lights went out in Massachusetts

Anyway, readers want to know where the markets stand today, after the sell-off this week.  My view of it — my 'view', not my gut-feeling — is that we are, so far, merely correcting from an over-extended rally.  This rally has been bizarre, to say the least.  This has been a 'fear rally' — usually the 'fear' side of the equation is when selling comes in, 'greed' driving the expansion.  But fear of systemic failure has driven this rally; and Ben Bernannke has been the captain sailing the 'Boat of Fear',   Ben's logic — that more debt will solve the insolvency crisis — has a shadow side, the logic that a collapse in stock prices will result in systemic failure, international chaos, revolution, repression…made him believe that preservation of the status quo was requiired, at any price.  A 'make-believe' recovery could be jump-started, perhaps, if the Fed could just stimulate (and simulate) another asset-bubble.  After all – that is how his mentor and predecessor, Alan Greenspan, had become the darling of the coctail party crowd, leading member of Time Magazine's 'Committee to Save the World';
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Dr. Strangebear

Here are a few quick posts by Tim Knight at Slope of Hope. - Ilene

Dr. Strangebear

Or……..how I learned to stopped worrying and love the bull.

I bought a very large position in SSO earlier today for a couple of reasons:

  • I don’t get my jollies out of losing money;
  • The OPEX week clearly has import;
  • I was impressed and convinced by Fujisan’s post last night, calling for – if memory serves – a push to 1086 by Friday.

I am having fewer and fewer compunctions about buying select stocks. That is evident from my watch lists.

One cause for concern for the bulls remains…………..volume! Just take a look at the volume graph; it’s simply pathetic.

0916-sso 

When Does the V Exhaust?

It is generally true that prices climb higher at a far slower rate than they drop. This rally, however, has been a remarkable exception. The push higher has been explosive, and it has pushed higher with just about the same timetable and force as the drop itself.

0916-V

The question, of course, is: when (if ever) will it end?

There are as many opinions as there are traders, but a few general camps would be, using the example of the Russell 2000 above:

  • It has another 10% to go, and it will happen quickly. That would be painful for the bears, but I would hasten to point out that, at that level, the Russell would have completely retraced to the neckline of a head and shoulders pattern spanning three years whose beauty would make bears (if there are any left by then) weep tears of joy.
  • It’s done climbing and will start falling. This has been uttered so many times by so many parties (including, I admit, a few times by me) that it’s not even worth considering anymore. The entire, "OK, now………….errr………OK, NOW!………..oh, wait…………….errr, NOW!" gets really, really old.
  • We’re in a major new bull market and it’s simply going to keep pushing its way through to progressively higher prices.

For the bears out there who would like some encouraging news, the semiconductor index – which is a helpful bellweather – is looking like it is approaching a huge area of resistance. This is why I bought SSG yesterday.

0916-sox  

Snark and Despair All the


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Testy Tuesday Morning

Our levels are holding so far

We came right back to 1,000 on the S&P yesterday but it held like a champ and that gave us the confidence to take a bullish cover on our longer DIA protective puts, right at 3:04, ahead of the usual 50-point stick save but it was a move we initiated right at the bottom at 2:30, catching almost the dead bottom on our roll.  Of course it's total nonsense but it's total nonsense we can count on with 8 stick saves of at least 50 points in the last 90 minutes coming in the last 10 market sessions accounting for 400 points of Dow gains or ALL of our gains since July 20th when we "broke out."

As illustrated in David Fry's SPY chart, the only exceptions to the stick save were the last two Fridays and I said to members in yesterday's chat, perhaps that is somehow significant that the collective we call "Mr. Stick", does not feel confident enough to make bullish plays into the weekend anymore.  Today we should head right back to re-test 1,000 on the S&P but we are much more bearish overall, having taken profits yesterday and covered our unrealized gains in our $100KP - the plan we discussed in yesterday's morning post.

We got a re-test and a re-failure of the Russell at exactly our 574 target right at 11:15 and the the Qs never even mounted a serious threat on our 40 line so it wasn't a tough call for us in the morning.  The other levels we are watching, Dow 9,297, S&P 1,000, Nasdq 2,017, NYSE 6,438, Russell 562 and SOX 308, are looking shaky and may not stand up to another test, especially if we get any bad news on our upcoming data with Wholesale Inventory and Productivity Reports on deck this morning.  Our bearish additions were an ERY spread (3x Energy bear) and COF Sept $40 puts, which are already up 10% from our 12:17 pick.  It wasn't all negative, we liked a couple of buy/write plays and we took a very bullish spread on FRE, which should do very well this morning.  At 12:57 we had noticed FRE moving up and, in Member Chat, we were discussing the merits and my take was this:

FRE/Ifl – The float of FRE is just 650M shares and they


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GDP Friday – How Much Will Be Enough?

Can the S&P make 1,000 today?

As we can see from AlphaTrends chart, that's going to be a tough breakout and, even if we do make it, can we hold it?  In yesterday's post I said we were ready to switch off our brains and BUYBUYBUY the rally and our breakout levels did all hold yesterday but I decided, in Member Chat, that we needed to raise the bar slightly before we started shutting down our thought processes into the weekend.  We simply used the 2.5% lines of Dow 9,297, S&P 1,000 (interesting!), Nas 2,017, NYSE 6,438, Rut 562 and SOX 308 in my 10:16 Alert as our official buying breakouts but those same levels gave us a great indicator to get out of our longs and press our shorts as they ALL failed by 11:09.

Personal Consumption Q1 09

It is going to be very much up to the GDP report and we have a pretty low-bar expectation of -1.5% but that's a heck of an improvement over last quarter's -5.5% and this earnings season has been nothing if not a celebration of "getting worse more slowly."  As we all know, personal consumption makes up 70% of the GDP while government is about 18% and business investment just 12%.  Durable goods are only 8% of the GDP while consumables (which includes clothes and, obviously, food and fuel) are 20% and 40% is "services" but 1/4 of that number is Real Estate so that's a little confusing. 

As we know, not much is actually getting better but that's not the issue with GDP as we are measuring "growth" compared to the prior 4 quarters and our prior year was a disaster!  This is like when a raging fire causes a house to collapse and you stand there looking at the wreckage and say "at least most of the fire is out now."

The good news is the comps just keep getting easier and easier the worse things get so, at some point, you are bound to improve!  As you can see from Briefing.com's Real GDP chart on the left, there's a pretty wide disparity between the Real and Nominal GDP and that's because the Real GDP meansures the production of goods and services valued at constant prices.  So we aren't
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Phil's Favorites

Rand Paul Blasts McCain Over Perpetual War: "He Would Bankrupt the Nation"

Courtesy of Mish.

Senator Rand Paul blasted fellow Republican Senator John McCain over McCain’s perpetual warmongering on ABC’s “This Week”.

Some are undoubtedly disheartened by political infighting, but this infighting is good.

These are debates the country desperately needs to have.

Earlier today Rand paul stated “We’re very lucky John McCain is not in charge.”

Sen. Rand Paul (Ky.) ripped fellow Republican Sen. John McCain (Ariz.) on Sunday after McCain criticized President T...



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Zero Hedge

Trump Administration Toughens Asylum Rules, Speeds Deportation Process

Courtesy of ZeroHedge. View original post here.

Amid judicial blockages, and rogue border agents, it appears the Trump administration is still trying its best to follow through on its campaign promises to crackdown on illegal immigration. As Reuters reports, The Department of Homeland Security has prepared new guidance for immigration agents aimed at speeding up deportations ...



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ValueWalk

Warren Buffett - How to Calculate Intrinsic Value

By The Acquirer's Multiple. Originally published at ValueWalk.

One of our favorite investors here at The Acquirer’s Multiple is Warren Buffett.

Lat week I provided and excerpt from Buffett’s ‘Owner’s Manual’ – In June 1996, Berkshire’s Chairman, Warren E. Buffett, issued a booklet entitled “An Owner’s Manual” to Berkshire’s Class A and Class B shareholders. The purpose of the manual was to explain Berkshire’s broad economic principles of operation.

]]> Get The Full Warren Buffett Series in PDF

Get the entire 10-part series on Warren Buffett in PDF. Save it to your ...



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Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Managers at a $1 trillion asset manager say investors are dangerously underplaying 3 things (Business Insider)

2016 was not a great year for forecasting. 

The UK's decision to leave the European Union, and President Donald Trump's win despite what the polls showed, humbled many people who were sure that the opposite outcomes would happen.

China Suspends All Coal Imports From North Korea (NY Times)

...



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Digital Currencies

How to Use, Trade, Store and Invest in Bitcoin Digital Assets - Step by Step, Part 1

By Reggie Middleton

(Originally published on Zero Hedge)

I will teach novices and experts alike how to fit Bitcoin into an investment portfolio safely and with the optimum risk-adjusted potential - along with step-by-step guides, instructions and tutorials.

This first part of the series starts with the basics, obtaining and managing your bitcoin.

What is Bitcoin?

First off, we need to know what Bitcoin is since most media pundits and even experienced financial types truly do not know. Bitcoin (capital "B") is a protocol driven network (very similar to that other popular protocol-based network, the Internet). This network is a blank tapestry upon which smart and creative actors can paint a cornucopia of applications (just like applicat...



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Kimble Charting Solutions

Fear Indicator; Hitting highest levels in history, says Joe Friday

Courtesy of Chris Kimble.

Markets have been on a steady rise and the same can be said for Inverse Fear ETF (XIV). Below looks at Inverse Fear ETF (XIV) since the lows in 2011.

CLICK ON CHART TO ENLARGE

What a difference a year can make! One year ago this week, XIV was testing rising channel support, as relative momentum was hitting levels last seen at the 2011 lows.

...



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Members' Corner

Save Your Relationship?

Courtesy of Nattering Naybob.

Once again it's "in the Toilet Thursday" or "Thursday's in the Loo".

Our last episode How to Poop At Work? answered the question, what to do when your at a big fancy pants meeting, when out of nowhere, you need to download a brown load?

This week's installment, Save Your Relationship, demonstrates that people will do just about anything to save their relationshits...

...

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Mapping The Market

NSA May Be Withholding Intel from President Trump

By Jean Luc

These GOP guys were so worried about Hillary's email server and now we find out that we had something close to a Russian mole in the White House. In the meantime, Trump keeps on using his unsecured phone, had high level conversation in his resort in front of dinner guests! It's getting so bad that rumors are now circulating that the NSA is not sharing information with the WH:

NSA May Be Withholding Intel from President Trump

By 

….Our spies have had enough of these shady Russian connections—and they are starting to push back….In light of this, and out of worries about the White House’s ability to keep secrets, some of our spy agencies have begun withholding intelligence fro...



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OpTrader

Swing trading portfolio - week of February 13th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Chart School

Weekly Market Recap Feb 12, 2017

Courtesy of Blain.

The week that was…

The quite long in the tooth rally continues as we had 3 days of minor loses to begin the week; ending with 2 days of moderate gains.  We are in a bit of a quiet zone as most S&P 500 companies have now reported earnings, the Federal Reserve is not a “worry” for about a month and a half, and the major economic news of the month hit the prior week.  So the gnashing of teeth (or not) about government policy seems to be the main driver right now- late in the week it was announced some major new tax initiatives would be coming down the pike soon which the market liked.

President Donald Trump said Thursday that an announcement concerning taxes is on tap for the coming weeks, which his press secretary later said would involve an outline of a comprehensive tax plan. “...



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Promotions

Phil's Stock World's Las Vegas Conference!

Learn option strategies and how to be the house and not the gambler. That's especially apropos since we'll be in Vegas....

Join us for the Phil's Stock World's Conference in Las Vegas!

Date:  Sunday, Feb 12, 2017 and Monday Feb 13, 2017            

Beginning Time:  9:30 to 10:00 am Sunday morning

Location: Caesars Palace in Las Vegas

Notes

Caesars has offered us rooms for $189 on Saturday night and $129 for Sunday night but rooms are limited at that price.

So, if you are planning on being in Vegas (Highly Recommended!), please sign up as soon as possible by sending...



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Biotech

The Medicines Company: Insider Buying

Reminder: Pharmboy and Ilene are available to chat with Members, comments are found below each post.

I'm seeing huge insider buying in the biotech company The Medicines Company (MDCO). The price has already moved up around 7%, but these buys are significant, in the millions of dollars range. ~ Ilene

 

 

 

Insider transaction table and buying vs. selling graphic above from insidercow.com.

Chart below from Yahoo.com

...

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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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