Archive for 2013

Swing trading portfolio – week of April 15th, 2013

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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Swing trading virtual portfolio

 

One trade virtual portfolio

 

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





“Wise Men” Propose Theft to Bail Out Banks

Courtesy of Mish.

Far be it from bondholders or banks that caused the debt crisis to be punished for their sins, German ‘Wise Men’ push for wealth seizure to fund EMU bail-outs.

Two top advisers to German Chancellor Angela Merkel have called for a tax on private wealth and property in eurozone debtor states to force the rich to fund rescue costs, marking a radical new departure for EMU crisis strategy.

Professors Lars Feld and Peter Bofinger said states in trouble must pay more for their own salvation, said arguing that there is enough wealth in homes and private assets across the Mediterranean to cover bail-out costs. “The rich must give up part of their wealth over the next ten years,” said Prof Bofinger.

The two economist are members of the Germany’s Council of Economic Experts or “Five Wise Men”, a body that advises the Chancellor on major issues. There is no formal plan to launch a wealth tax but the council is often used to fly kites for new policies.

Prof Feld said a new survey by the European Central Bank had revealed that people in the crisis countries are richer than the Germans themselves. “This shows that Germany has been right to take a tough line of euro rescue loans,” he said.

Study Details

Supposedly the median or midpoint wealth level, stripping out the super-rich is as follows:

  • Spain €183,000 for Spain
  • Italy  €172,000 for Italy
  • Portugal €102,000
  • Cyprus €671,000
  • Austria €265,000
  • Germany €195,000
  • Holland  €170,000
  • Finland €161,000

One look at the data is all it takes to conclude the report does not pass the “sniff test”. A closer look shows the study was also undertaken before the Spanish property bubble imploded and that it ignores pensions.

Yet, the “Wise Men” embraced the study. Why?

The answer is simple. The study gave them the incentive to propose what they wanted to propose all along: theft to bail out failing banks that made stupid loans.

As Ambrose Evans-Pritchard points out in his article “Any serious move to a wealth tax could the erode the pro-euro ardour of South Europe’s uber-rich.”

Indeed. So just how wise are the alleged “wise men”?



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Gold, Silver In Asian Liquidation Mode As China Growth Slows More

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

UPDATE: Spot Gold $1426 (from $1564 highs Friday)

As Asia opens to the bloodbath that occurred in precious metals on Friday in the US, it would appear that more than a few traders got the ‘tap on the shoulder’. Shanghai futures are limit-down and spot gold and silver prices are plunging once again as we suspect forced margin-calls and the raising of cash (to cover extreme variation margin – or capital reserves) needed in JGB positions, as we explained here. Liquidation is certainly the theme of the evening – investors are selling JGBs (6th day in a row of multiple-sigma moves in long-dated Japanese bonds 30Y +56bps off its post-BoJ lows at 1.60%!), selling Japanese stocks (Nikkei -128 pts, second biggest down day post-BoJ), selling US Treasuries (futures down), selling gold and silver (gold spot down over $100 from Friday’s highs), and despite selling JPY early (retracing 30% of the weakness post-BoJ), JPY is practically unchanged (jerking lower only on the US futures open and Asian equity open) – it seems Mrs.Watanabe is struggling and unwinding some her excessively short JPY and long NKY positions.

 

Gold down over $100 from Friday’s highs…

 

Which takes spot gold back to the 38.2% Fib retracement of the most recent low to high swing…

 

Tokyo COMEX Gold -9.2% (limit down) – looks like a giant post-BoJ roundtrip…

 

Silver ugly too…

 

Another day, another 4-sigma move in JGBs…

and post the China data…

  • GDP Miss
  • Retail Sales Miss
  • Industrial Production Miss
  • Fixed Asset Investment Miss

which stands in the face of the ‘survey-driven’ PMI data…

… everything is red – JGBs down, Japanese stocks down, US Stocks down, US Treasuries down, Gold and Silver down, Copper down, Oil down, Rubber futures limit down

 

 

Charts: Bloomberg





Gold In Asian Liquidation Mode

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

UPDATE: Spot Gold $1426 (from $1564 highs Friday)

As Asia opens to the bloodbath that occurred in precious metals on Friday in the US, it would appear that more than a few traders got the ‘tap on the shoulder’. Shanghai futures are limit-down and spot gold and silver prices are plunging once again as we suspect forced margin-calls and the raising of cash (to cover extreme variation margin – or capital reserves) needed in JGB positions, as we explained here. Liquidation is certainly the theme of the evening – investors are selling JGBs (6th day in a row of multiple-sigma moves in long-dated Japanese bonds 30Y +56bps off its post-BoJ lows at 1.60%!), selling Japanese stocks (Nikkei -128 pts, second biggest down day post-BoJ), selling US Treasuries (futures down), selling gold and silver (gold spot down over $100 from Friday’s highs), and despite selling JPY early (retracing 30% of the weakness post-BoJ), JPY is practically unchanged (jerking lower only on the US futures open and Asian equity open) – it seems Mrs.Watanabe is struggling and unwinding some her excessively short JPY and long NKY positions.

 

Gold down over $100 from Friday’s highs…

 

Silver ugly too…

 

Another day, another 4-sigma move in JGBs…

and post the China data…

  • GDP Miss
  • Retail Sales Miss
  • Industrial Production Miss
  • Fixed Asset Investment Miss

… everything is red – JGBs down, Japanese stocks down, US Stocks down, US Treasuries down, Gold and Silver down, Copper down, Oil down

 

 

Charts: Bloomberg





Ex-Soros Advisor Sells “Almost All” Japan Holdings, Shorts Bonds; Sees Market Crash, Default And Hyperinflation

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Previously, we have pointed out why Japan’s attempt at reincarnating its economy, geared solely at generating a stock market-based “wealth effect”, and far less focused on boosting the country’s trade surplus or current account, is doomed to failure, namely due the drastically lower equity participation by the general population and financial institutions in the country’s stock market. Sure, foreign investors will come and go renting each rally for a period of time, but unless the local population participates in the “reflation attempt” (which has already sent the price of luxury goods, energy and food through the rood), or in other words change the behavioral patterns of two generations of Japanese in under two years, the inflationary shock will simply leads to a loss of faith in the government and ultimately Abe’s second untimely demise. Not surprisingly, 4 months after Japan set off on the most ludicrous economic experiment in history, and one week after the BOJ announced its plans to double its balance sheet, Abe’s approval rating has already begun sliding with a poll by Asahi just reporting that popular support of Abe’s cabinet is already down to 60%, down from 71% a month ago.

The reflationary reality has finally started to get official recognition with the very Goldman Sachs (who like in Europe and the US is behind this epic experiment in hidden taxation of consumers) asking how popular inflation would be in Japan, and answers:

How popular will inflation be in Japan? Assuming the BoJ is successful and inflation rates rise, one interesting dynamic will be the political support for ‘super-easy’ monetary policy. The majority of financial household assets sit in deposits, which until now have earned a positive real rate. While long-term inflation expectations move higher, the Yen and equities re-price rapidly but the negative impact on deposit returns from negative real rates will only be felt once inflation has actually started to materialise. This is clearly not an immediate concern as the government’s approval ratings remain high ahead of the Upper House elections this Summer. Still, PM Abe’s policy aim of beating deflation may become less popular at some stage because the implied distributional choices of higher inflation may become clearer for voters. For example, higher inflation


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Priced For Perfection – A Return To ‘Normal’ Won’t Be Enough

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

The equity rally over the past 18 months has been driven by multiple expansion. As Morgan Stanley’s Gerard Minack notes, equity markets have been highly correlated with macro surprises – whether economic data have been exceeding, or falling short of, consensus forecasts – through this expansion. However, we note that the potential for a market setback is extreme; as the gap between what seems increasingly needed to sustain the rally – better growth and earnings news – versus the prospect of weaker US growth is as wide as it has been in five years. The macro news flow is now disappointing in the major developed economies. Moreover, there’s been a pseudo-seasonal pattern to the ebb and flow of surprises, with weakness typical in the middle quarters of the year. The very recent weakness in the US is more troubling though as it is set against the backdrop of already-sluggish global growth, which is most pronounced in the developed markets; and reflecting the sag in global growth (and earnings), global equities have already stalled outside the US. The out-performance of equities versus bonds over the past year is consistent with solid macro improvement and as the chart below indicates, that hope is fading fast.

 

Global equity valuations (MSCI World 1Y Forward P/E) have been highly correlated with G10 Macro Surprises. What should be very clear is the fact that Macro turns lead equity valuation adjustments (red arrows then blue arrows). What is more disconcerting is the current disconnect is very reminiscent of the levels and divergence that occurred in 2008…

 

And to confirm this ‘hope’ priced in – the relative performance of equity over bonds (orange line) already prices in a return to pre-new-normal levels of economic activity globally (judged by Global PMIs). However, those Global PMIs are not playing along

 

It seems to us that between US (and Japan) dramatic outperformance of their G10 peers

 

…and the disconnects between macro- and micro-valuations that BTFD in US equities now is hardly the ‘cheap’ shiniest ‘turd’ trade every asset-gathering talking-head suggests it is.

Charts: Bloomberg and Morgan Stanley





Which Nations Are Next? The Credit Market Answers

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

The debate about the usefulness of sovereign credit default swaps (SCDS) intensified with the outbreak of sovereign debt stress in the euro area. SCDS can be used to protect investors against losses on sovereign debt arising from so-called credit events such as default or debt restructuring.

Although CDS that reference sovereign credits are only a small part of the sovereign debt market ($3 trillion notional SCDS outstanding at end-June 2012, compared with $50 trillion of total government debt outstanding at end-2011), their importance has been growing rapidly. With the growing influence of SCDS, questions have arisen about whether speculative use of SCDS contracts could be destabilizing – and this caused regulators to ban non-hedge-related protection buying.

The prohibition is based on the view that, in extreme market conditions, such short selling could push sovereign bond prices into a downward spiral, which would lead to disorderly markets and systemic risks, and hence sharply raise the issuance costs of the underlying sovereigns. The IMF’s empirical results do not support many of the negative perceptions about SCDS. In particular, spreads of both SCDS and sovereign bonds reflect economic fundamentals, and other relevant market factors, in a similar fashion. Relative to bond spreads, SCDS spreads tend to reveal new information more rapidly during periods of stress, admittedly with overshoots one way or the other. Given the current apparent ‘stability’ in many nations’ bond market spreads, the chart below suggests an alternative way of judging what the credit market thinks – the volume of protection bid – and in this case some interesting names emerge.

Do Sovereign CDS Lead or Lag – the answer is both…

The Hasbrouck statistic shows whether SCDS or sovereign bond markets move faster to incorporate news: when the statistic is higher than 0.5, SCDS lead the price discovery process; otherwise, bonds lead. Statistics are estimated from a panel vector error correction model using rolling two-year windows of daily data. Resulting series are smoothed using a one-month moving average.

The chart below shows at what times SCDS lead and what times bonds have lead…

 

Vertical lines indicate events related to the global financial and sovereign debt crisis (upper panel) and to the EU’s ban on naked short sales of SCDS instruments (lower panel) as follows:

  1. Bear Stearns collapse (March 14, 2008).


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Weekly Market Commentary: Breadth Recovers, But Still Net Bearish

Courtesy of Declan Fallon

The Masters has me distracted, so I will just show two charts:

The Nasdaq has had a very good run of form of late, but it hasn’t really changed the breadth picture a great deal.  Bulls will look to the new swing low which will be confirmed if the Nasdaq Summation Index crosses above its 5-day EMA, and other breadth indicators hold their 5-day EMA.  Bears will see a dominant bearish trend, particularly in the Percentage of Stocks above the 50-day MA, and suggest the current run is nothing more than a relief rally.

From a trading perspective, you need to protect yourself against false breakouts.  Because of the vulnerability of the breadth metrics it will be important 3,270 holds as support (for the Nasdaq).  A loss of 3,168 would confirm a ‘bull trap’.

The Nasdaq 100 shows the battleground nicely. Horizontal support at 2,825 is key.

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Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com. You can read what others are saying about Zignals on Investimonials.com.

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Gold And 5 Years Of Global Central Bank ‘Temporary And Emergency’ Monetary Policy Actions

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

When all this began, we were reassured that extraordinary balance sheet expansion and the ZIRP environment were merely temporary and only to get us through the short-term emergency. The following chart and table covering the monetary-policy-on-steroids of the Fed, ECB, BoE, and BoJ suggests this is a long-emergency indeed… and the current disconnect between the ‘planned’ expansion of central bank balance sheets and gold suggests that Cyprus’ central bank head may just replace UK’s Gordon Brown as the worst market-timer ever.

 

Five years of temporary, emergency-only actions by the world’s central banks… (click for large more legible version)

 

As all of these actions took place and the balance sheets of the world’s central banks exploded – and each time, Gold has front-run that move…

 

This time it appears (once again) gold was right (in its guess to April 2013) and unless all the central bankers in the world are about to be forced to stop the seemingly unstoppable plans they have (black arrow indicates Fed and BoJ expectations alone), then Gold (just as in late 2012) is set to recover significantly.

 

Charts: IMF and Bloomberg





Germany’s ‘Five-Wise-Men’ Confirm Wealth Tax Is Coming

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

As we have vociferously warned since September 2011, and most recently as the Cyprus debacle exploded explained why it is just beginning, Germany’s Council of Economic Experts (or so-called ‘Five Wise Men’) just confirmed a wealth tax is coming. As the Telegraph reports, confirming our expectations, Germany warns that states in trouble must pay more for their own salvation, arguing that there is enough wealth in homes and private assets across the Mediterranean to cover bail-out costs. They further added that targeting deposit-holders is also a mistake, since the “resourceful rich just move their money to banks in northern Europe and avoid paying,” preferring instead taxes on property or other less-mobile assets, “for example, over the next 10 years, the rich should give up a portion of their assets.” As we noted here and here, the differences between mean and median wealth in the peripheral nations suggest that people in the bailed-out countries are often better-off than those in Germany – – “this shows that Germany has been right to take a tough line of euro rescue loans.” However, the implications of a wealth tax – implicitly impacting the pro-euro Southern European uber-rich – raises the specter of EU breakup once again.

 

Via The Telegraph,

Any serious move to a wealth tax could the erode the pro-euro ardour of South Europe’s uber-rich. The ECB bond buying policy has largely rescued the wealthiest strata while the full brunt of EMU austerity has fallen on ordinary people and the unemployed.

 

The political debate on euro membership may change dramatically if rich Cypriots, Italians, Spaniards, and Portuguese start to see EMU as a threat to their property, rather than a defence.

Via Der Spiegel,

Prof Lars Feld, another “wise man”, highlighted a recent study by the European Central Bank, which Germans say show that the people in bailed-out countries are often better-off than those in Germany. Less than half of Germans own their own home, lower than the rate in many southern eurozone members.

 

The ECB study found that the “median” wealth in Cyprus is €267,000 (£227,600), compared to just €51,000 in Germany. The median or midpoint level –


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Phil's Favorites

Trump and the problem with pardons

 

Trump and the problem with pardons

Courtesy of Andrew Bell, Indiana University

As a veteran, I was astonished by the recent news that President Trump may be considering pardons for U.S. military members accused or convicted of war crimes. But as a scholar who studies the U.S. military and combat ethics, I understand even more clearly the harmful long-term impact such pardons can have on the military.

My researc...



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Zero Hedge

"You've Been Had": Elon Musk's Grand Hyperloop Vision Debunked As "Scam"

Courtesy of ZeroHedge. View original post here.

It looks as though everybody, including the media, is starting to understand that Elon Musk's once grandiose "Hyperloop" idea, to be built by The Boring Company, isn't the futuristic game changer that it was pitched as. In fact, it's looking more and more like a very rudimentary idea that's been around for decades: a car in a tunnel. 

And people are catching on that this is not what Musk repeatedly talked about when baffling the public with bullshit publicly describing the idea of a Hyperloop. Over the weekend, the ...



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Insider Scoop

Jefferies Sees 60-Percent Upside In Aphria Shares, Says Buy The Dip

Courtesy of Benzinga.

After a red-hot start to 2019, Canadian cannabis producer Aphria Inc (NYSE: APHA) has run out of steam, tumbling more than 31 percent in the past three months.

Despite the recent weakness, one Wall Street analyst said Friday that the stock has 30-percent upside potential. 

The Analyst

Jefferies analyst ...



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Kimble Charting Solutions

DAX (Germany) About To Send A Bearish Message To The S&P 500?

Courtesy of Chris Kimble.

Is the DAX index from Germany about to send a bearish message to stocks in Europe and the States? Sure could!

This chart looks at the DAX over the past 9-years. It’s spent the majority of the past 8-years inside of rising channel (1), creating a series of higher lows and higher highs.

It looks to have created a “Double Top” as it was kissing the underside of the rising channel last year at (2).

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Brexit Joke - Cant be serious all the time

Courtesy of Read the Ticker.

Alistair Williams comedian nails it, thank god for good humour! Prime Minister May the negotiator. Not!


Alistair Williams Comedian youtube

This is a classic! ha!







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Digital Currencies

Cryptocurrencies are finally going mainstream - the battle is on to bring them under global control

 

Cryptocurrencies are finally going mainstream – the battle is on to bring them under global control

The high seas are getting lower. dianemeise

Courtesy of Iwa Salami, University of East London

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Biotech

DNA as you've never seen it before, thanks to a new nanotechnology imaging method

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

 

DNA as you've never seen it before, thanks to a new nanotechnology imaging method

A map of DNA with the double helix colored blue, the landmarks in green, and the start points for copying the molecule in red. David Gilbert/Kyle Klein, CC BY-ND

Courtesy of David M. Gilbert, Florida State University

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ValueWalk

More Examples Of "Typical Tesla "wise-guy scamminess"

By Jacob Wolinsky. Originally published at ValueWalk.

Stanphyl Capital’s letter to investors for the month of March 2019.

rawpixel / Pixabay

Friends and Fellow Investors:

For March 2019 the fund was up approximately 5.5% net of all fees and expenses. By way of comparison, the S&P 500 was up approximately 1.9% while the Russell 2000 was down approximately 2.1%. Year-to-date 2019 the fund is up approximately 12.8% while the S&P 500 is up approximately 13.6% and the ...



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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

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It's Not Capitalism, it's Crony Capitalism

A good start from :

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OpTrader

Swing trading portfolio - week of September 11th, 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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Promotions

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In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

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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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