Archive for 2013

Swing trading portfolio – week of June 17th, 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

Optrader 

Swing trading virtual portfolio

 

One trade virtual portfolio

 

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





The Jury: Still Deliberating

The Jury: Still Deliberating

Courtesy of Paul Price 

Jury image

Five weeks ago I wrote that the Thomson Reuters Insider Transaction Ratio was screaming ‘caution’. An excerpt of that May 11, 2013 column is shown below:

"A normally reliable short-term indicator is looking bearish.  

"Insiders, on balance, always sell more shares than they buy because they receive so much stock through employee compensation and bonus plans. The Thomson Reuters Insider Transaction Ratio considers it bullish when company officers and 5%+ holders, as a group, sell less than twelve times the dollar amount that insiders are buying. When that ratio exceeds 20:1, it is considered to be bearish, signaling widespread distribution.

"This indicator has proven fairly accurate looking out weeks to months. It is too volatile  to be useful for longer periods. I matched up the past 12-months signals to the movement of the SPY (S&P 500 ETF) to illustrate where it went right and wrong.

"The twin bearish insider selling peaks last September and October appeared to have provided valuable advanced warning of the sell-off that ended in mid-November. The short burst of intense insider selling that took place this past January ended up being a false negative. Five of the six major ‘buy’ signals worked out well.

Thomson Reuters Insider Trading Ratio May 10, 2013

"Both the SPY and Dow Jones Industrials closed at new all-time highs last week. Company officers have been active sellers. The Thomson Reuters Ratio is back in dangerously high territory. Will this be a good signal or a misleading one? Only time will tell."

*******

That extremely bearish signal turned out to be less than perfect.

The S&P 500 and the DJIA both moved higher for another seven or eight trading sessions before reversing trend. They have, however, gone sideways since the insider signal flashed the yellow caution light.

DJIA & SPY May 10, 2013 - Jun 14, 2013

What is the insider transaction ratio saying about the mid-June market? It has come back into neutral territory.

June 14, 2013    Insider Transaction Ratio

It appears that the last year’s signals have been more predictive on the bullish side than the bearish side.

Stay tuned for further updates as the remainder of 2013 unfolds.





Superman Joins a Union

Courtesy of Mish.

Inquiring minds may be wondering what would happen if the “Man of Steel” were forced to join a union. The following video explains.

Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com



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Entitlement America And The High Cost Of “Free”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Almost three years ago we first highlighted the real math behind the surging entitlement class that America has become. So why does a large portion of the population choose not to work when there are many jobs available? The answer is simple. If you can receive 2-3 times as much money from unemployment, disability, and/or welfare benefits (subsidized housing, food stamps, free cellphones, etc.) as you can from a temporary or part-time job, and live a life of leisure, why work? This is the ugly reality we illustrated just six months ago and the situation – amid what is apparently called a ‘recovery’ remains a depressingly real sign of the times. The political allure of free is so strong that an alarming number of people choose to become wards of the entitlement/welfare state rather than captain their own destiny. Indeed, while many are ‘proud’, 49% of American households now receive one or more government transfer benefits amounting to 18% of all personal income and a burden of $7,400 for every American – seemingly threatening the supposed self-reliance that has long characterized the American national psyche.

 

Via the Ludwig von Mises Institute,

Why does a large portion of the population choose not to work when there are many jobs available? The answer is simple. If you can receive 2-3 times as much money from unemployment, disability, and/or welfare benefits (subsidized housing, food stamps, free cellphones, etc.) as you can from a temporary or part-time job, and live a life of leisure, why work? In 2011, the U.S. government spent over $800 billion this “welfare,” exceeding expenditures on Social Security or Medicare.

In the Denver arena where Mr. Obama gave his DNC 2008 acceptance speech, a woman in the audience became overwhelmed by the speech and said that she no longer needed to worry if she could make her car or mortgage payments because he would take care of it for her. In Cleveland, a woman claimed that she was going to vote for President Obama again because he gave her a free cellphone (along with a litany of other entitlement giveaways). Before you growl, you should know that the free cellphone program was instated by President Bush in 2008 through the FCC’s Universal Service Fund. Fees for these “free” cellphones are paid…
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Prisoner’s Dilemma: Will Investors And The Fed Collaborate?

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

The recent market weakness (selling off in equity indices and widening in credit spreads) shares many elements of the previous dips this year, which should give bulls some comfort (the Italian- and Cyprus-led dips didn’t last very long). However, there are elements which are concerning – as Citi notes, positioning in long equity and credit positions are notably ‘long’, and how weak cash credit has been this time around. As Citi points out, investors and the Fed are trapped in a prisoner’s dilemma. Will everyone collaborate (investors hold to cash positions & dovish Fed) or betray (investors start unwinding cash positions & hawkish Fed)? The strategy each player follows will determine whether the weakness this time around is to be faded (like the previous ones this year) or not.

The following discussion – via Citi’s credit team – relates to ‘widening’ in credit spreads but is just as useful in considering the weakness in equity markets since the cap[ital structure arbitrage-led relationship between equity and credit as liabilities on the balance sheet of a ‘firm’ means that any disconnect cannot last long.

Via Citi,

The recent widening on the back of concerns about a “rates back-up” (and its potential to create substantial selling pressure across many asset classes) shares, at least on the surface, many of the characteristics of two widenings we’ve experienced this year: the “Italian”- and “Cypriot”-led widenings in the second half of February and March, respectively. In those two cases, the widening faded after one or two weeks.

This time around, the credit index has not started to tighten (rally yet)…

However, as we show below, positioning this time around seems more stretched than in previous widenings and cash credit has been much weaker than anytime this year. As we argued last week, we are at a pivot point, and we expect US yields (on the back of the Fed’s message next week) to give direction to the market.

(Upper pane – credit positioning is the most ‘net long’ since 2011… Lower pane – equity margin account debit balances highest ever)

 

In all the three widenings this year, the weakness has been led by synthetic products, with

(i) real money investors holding to their cash positions and hedging with synthetic instruments


continue reading





Prisoner’s Dilemma: Will Investors And The Fed Collaborate?”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

The recent market weakness (selling off in equity indices and widening in credit spreads) shares many elements of the previous dips this year, which should give bulls some comfort (the Italian- and Cyprus-led dips didn’t last very long). However, there are elements which are concerning – as Citi notes, positioning in long equity and credit positions are notably ‘long’, and how weak cash credit has been this time around. As Citi points out, investors and the Fed are trapped in a prisoner’s dilemma. Will everyone collaborate (investors hold to cash positions & dovish Fed) or betray (investors start unwinding cash positions & hawkish Fed)? The strategy each player follows will determine whether the weakness this time around is to be faded (like the previous ones this year) or not.

The following discussion – via Citi’s credit team – relates to ‘widening’ in credit spreads but is just as useful in considering the weakness in equity markets since the cap[ital structure arbitrage-led relationship between equity and credit as liabilities on the balance sheet of a ‘firm’ means that any disconnect cannot last long.

Via Citi,

The recent widening on the back of concerns about a “rates back-up” (and its potential to create substantial selling pressure across many asset classes) shares, at least on the surface, many of the characteristics of two widenings we’ve experienced this year: the “Italian”- and “Cypriot”-led widenings in the second half of February and March, respectively. In those two cases, the widening faded after one or two weeks.

This time around, the credit index has not started to tighten (rally yet)…

However, as we show below, positioning this time around seems more stretched than in previous widenings and cash credit has been much weaker than anytime this year. As we argued last week, we are at a pivot point, and we expect US yields (on the back of the Fed’s message next week) to give direction to the market.

(Upper pane – credit positioning is the most ‘net long’ since 2011… Lower pane – equity margin account debit balances highest ever)

 

In all the three widenings this year, the weakness has been led by synthetic products, with

(i) real money investors holding to their cash positions and hedging with synthetic instruments


continue reading





Water Cannon And Tear Gas In Turkey: The Photo Exhibition

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Two weeks after the break out of protests in Turkey, often times violent, the local discontent is nowhere closer to resolution. In fact, it is getting worse, and is on its way to converge with the “resolutions” adopted in its neighbor Greece following news that two Turkish union federations said on Sunday they would stage a one-day nationwide strike on Monday in protest at the forced eviction by riot police of hundreds of anti-government demonstrators from an Istanbul park. From Reuters: “The Confederation of Public Workers’ Unions (KESK), which has some 240,000 members in 11 unions, and the Confederation of Revolutionary Trade Unions (DISK) announced the strike in a joint statement. Three other groups representing doctors, engineers and dentists will also join the action, it said.”

And so “the economy gets it” until the politicians respond to the protestors in a satisfactory fashion, which may be a problem, because just like in the “Occupy XXX” movement in the US, nobody is exactly sure just what the demands are.

Regardless, the local protests, now accompanied daily by high pressure water cannon and constant tear gas make for some spectacular stills, such as the following series of photos over the weekend from Istanbul and Ankara.

A protester is attacked by water cannon during crowds in Kizilay square in central Ankara, June 16, 2013.

 

People take cover from water cannons during a protest at Kizilay square in central Ankara, June 16, 2013.

 

A protester is sprayed by a police water cannon during a demonstration at Taksim Square in Istanbul June 16, 2013.

 

A protester is being sprayed by the police’s water cannon during a demonstration at Kizilay square in central Ankara June 16, 2013.

 

Riot police use a water cannon to disperse anti-government protesters at Taksim square in central Istanbul June 15, 2013.

 

Protesters are attacked by police water cannon at the entrance Gezi Park near Istanbul’s Taksim square June 15, 2013.

 

A woman is attacked by water cannon during protests in Kizilay square in central Ankara, June 16, 2013.

 

A riot policeman orders protesters to evacuate Gezi Park near Istanbul’s Taksim square June 15, 2013.

 

Protesters are attacked by police water cannon next
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Guest Post: The Unknown Unknowns And Survivor Bias

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

Survivorship bias helps us understand why success stories are not what actually helps us succeed.

 
Former Secretary of Defense Donald Rumsfeld is famous for uttering a koan-like description of the epistomological ambiguity of human experience:
There are known knowns; there are things we know that we know.
 
There are known unknowns; that is to say, there are things that we now know we don't know.
 
But there are also unknown unknowns – there are things we do not know we don’t know.
(Interestingly, it appears Rumsfeld did not pen the koan himself; correspondent J.S.S. noted that the original source may be Landmark Education of Seattle, Washington.)
 
I recently read two fascinating accounts of why we have such a difficult time knowing what we don't know: it's called survivor bias, and what that means is we only get information from the survivors, not those who perished and vanished from the records.
 
A mid-list author recently explained how listening to the handful of authors who make it big financially is completely misleading: Survivorship bias: why 90% of the advice about writing is BS right now.
 
Here's how this works: big-bucks Author Z says, here are the 10 steps you need to take to become as successful as me. The list always mentions perseverance, being nice to your readers, writing 1,000 words a day and so on.
 
The 99.9% of writers/authors who make less than $10,000 a year


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Don’t Fear the Taper

Courtesy of ZeroHedge. View original post here.

Submitted by ilene.

Don’t Fear the Taper

Screen Shot 2013-06-15 at 3.48.24 PMIn this week’s newsletter, we present reasons for being long stocks and discuss the “Taper.” Click on link: Don’t Fear the Taper, 6-14-13.

Quantitative easing (QE) programs, courtesy of the Federal Reserve, have pushed cash into Primary Dealer accounts at the fastest rate in history. This has been massively bullish for equities over the past four years, as the Primary Dealers used some of that cash to bid up equity prices. This will likely continue until the Fed significantly curtails or discontinues its QE operations. 

US stock indices have been marking time during the past four weeks gauging “talk” about whether Chairman Ben Bernanke will slow down his printing presses. Notwithstanding the rumors, we doubt that QE tapering is on the horizon.

In our view, unless the Fed stops funneling money to the Primary Dealers, which we deem doubtful, pullbacks in stock prices are likely temporary pauses along an upward path. Therefore, in both of our Virtual Portfolios (Value and Put Selling), we are remaining long and unhedged.

Screen Shot 2013-06-12 at 6.59.39 PM

The Fed is Unlikely to Taper

America’s national debt now runs approximately $16.5 trillion. President Obama use his power to hold rates down because the cost of higher debt service would devastate his political agenda. 

Bernanke does Washington’s bidding so he is probably just ‘talking down’ market enthusiasm by leaking news of a coming ‘taper.’ In this fashion, he uses fear of reduced QE to contain equity prices without actually changing the Fed’s policy.

During the fiscal cliff debate in December 2012, people assumed tax rates would be much higher in following years. That precipitated an enormous amount of accelerated income and dividend payments that would have been made in 2013. Because of the higher income booked in Q4 2012, estimated tax payments due January 15, 2013, soared. This reduced the size of the expected Q1 deficit. 

Bernanke’s primary mission is to monetize the debt created by federal budgets that far exceed revenues. We see no way for the Fed to reverse course on QE regardless of the whispers to the contrary. 

The Fed has painted itself into a corner and there is no way to unwind the QE trade without debt service costs eating everyone alive. Unwinding would cause interest rates on U.S. sovereign debt to soar, because no one would buy debt at interest rates…
continue reading





NSA, UK Spied On Politicians, Intercepted Emails, Eavesdropped On Russian President’s Phone Calls

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

The espionage scandal that keeps on giving has released its latest installment, once more courtesy of the Guardian, which on the eve of tomorrow’s starting G-8 meeting reveals that foreign politicians and officials who took part in two G-20 summit meetings in London in 2009 had their computers monitored, their phone calls intercepted, and fake internet cafes were set up on the instructions of the British Government Communications Headquarters (GCHQ), the sister organization to the US NSA.

Naturally, it wasn’t just the GCHQ – according to the Guardian, during the 2009 G-20 meeting there was an NSA attempt to eavesdrop on then-Russian leader, Dmitry Medvedev, as his phone calls passed through satellite links to Moscow.

And while broad espionage allegations can be deflected by pretending by the rhetoric-endowed and teleprompter-aided that only terrorist threats were targeted, it will be very difficult to explain why the national information super spooks used every trick of the trade to spy on the so-called leaders of the developed world.

The disclosure raises new questions about the boundaries of surveillance by GCHQ and its American sister organisation, the National Security Agency, whose access to phone records and internet data has been defended as necessary in the fight against terrorism and serious crime. The G20 spying appears to have been organised for the more mundane purpose of securing an advantage in meetings. Named targets include long-standing allies such as South Africa and Turkey.

And like that, one more conspiracy theory is relegated to the “fact” bin, as those using the “tin foil, crack-pot conspiracy theorists” fallback, are slowly becoming the biggest laughing stock in town.

So who gave the green light for this blatant spying operation, which assuredly takes place at every meeting of the world’s leading political (and other) dignitaries? Why that supreme gold top-tick timer himself, Gordon Brown:

There have often been rumours of this kind of espionage at international conferences, but it is highly unusual for hard evidence to confirm it and spell out the detail. The evidence is contained in documents – classified as top secret – which were uncovered by the NSA whistleblower Edward Snowden and seen by the Guardian. They reveal that during G20 meetings


continue reading





 
 
 

Zero Hedge

Enemy Of The People?

Courtesy of ZeroHedge. View original post here.

Via The Zman blog,

There has never been a time when normal people did not know the media was biased and biased in a predictable direction. For every non-liberal in the media, there were at least ten liberals. The ratio was probably higher, but then, as now, some lefties liked to pretend they were independents or some third option.

The media used to invest a lot of time denying they had a bias and an agenda, but the only people who believed them were on the Left, which had the odd effect of confirming they had a bias and an agenda.

...



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Phil's Favorites

A 2019 Earnings Recession?

 

A 2019 Earnings Recession?

Courtesy of 

Shout to Leigh!

On the new Talk Your Book – Josh Brown is joined by Leigh Drogen of Estimize, one of the leading providers of crowdsourced financial and economic data to talk about the trend in corporate profits that could potentially lead to an earnings recession later this year.

What is the thing that Leigh is seeing in the data that Wall Street isn’t yet picking up on? What segment of the stock market is most at risk? Why is the crowd smarter than the narrow consensus of Wall Street analysts?

Check out Estimize ...



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ValueWalk

D.E. Shaw Investment Calls For Leadership Change At EQT

By ActivistInsight. Originally published at ValueWalk.

Elliott Management has offered to acquire QEP Resources for approximately $2.1 billion, contending the oil and gas explorer’s turnaround efforts have done little to lift the company’s share price. The company responded and said that a thorough review of the proposition is imperative in order to properly act in the best interests of shareholders, “taking into account the company’s other alternatives and current market conditions.” The news came only a month after Travelport Worldwide agreed to sell itself to Siris Capital Group and Elliott’s private equity arm Evergreen Coast Capital for $4.4 billion in cash and two months after Athenahealth was bought by Veritas and Evergreen for $5.7 bi...



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Kimble Charting Solutions

Gold & Silver Testing Important Breakout Levels!

Courtesy of Chris Kimble.

Gold and Silver from a long-term perspective have created a series of lower highs over the past 8-years. Will 2019 bring a change to this trend? A big test is in play!

Gold since the lows in 2016 has created a series of higher lows, while Silver may have created a double bottom.

Gold & Silver are currently facing break attempts a (1) and (2). These falling resistance lines have disappointed metals bulls for the past few years.

The direction of Gold and Silver weeks and months from now should be highly influenced by what each does as they are attempting to break above important resistance levels.

To become a member of Kimbl...



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Insider Scoop

UBS Says Disney's Streaming Ambition Gives It A 'New Hope'

Courtesy of Benzinga.

Related DIS Despite Some Risks, Analysts Still Expecting Double Digit Growth From Communications Services In Q4 ...

http://www.insidercow.com/ more from Insider

Digital Currencies

Russia Prepares To Buy Up To $10 Billion In Bitcoin To Evade US Sanctions

Courtesy of Zero Hedge

While the market has been increasingly focused on the rising headwinds in the global economy in general, and China's economic slowdown in particular, while the media is obsessing over daily revelations that Trump may or may not have colluded with Russia to get elected, a far more critical, if underreported, shift has been taking place over the past year.

As we reported in June, whether due to concerns over draconian western sanctions and asset confiscations following the poisoning of former Russian military officer Sergei Skripal, or simply because it wanted to diversify away from the dollar, Russia liquidated virtually all of its Treasury holdings in the late spri...



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Chart School

Weekly Market Recap Jan 13, 2019

Courtesy of Blain.

In last week’s recap we asked:  “Has the Fed solved all the market’s problems in 1 speech?”

Thus far the market says yes!  As Guns n Roses preached – all we need is a little “patience”.  Four up days followed by a nominal down day Friday had the market following it’s normal pattern the past nearly 30 years – jumping whenever the Federal Reserve hints (or essentially says outright) it is here for the markets.   And in case you missed it the prior Friday, Chairman Powell came back out Thursday to reiterate the news – so…so… so… patient!

Fed Chairman Jerome Powell reinforced that message Thursday during a discussion at the Economic Club of Washington where he said that the central bank will be “fle...



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Members' Corner

Why Trump Can't Learn

 

Bill Eddy (lawyer, therapist, author) predicted Trump's failure based on his personality, which was evident years ago. This article, written in 2017, references a prescient article Bill wrote before Trump became president, in July, 2016, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...



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Biotech

Opening Pandora's Box: Gene editing and its consequences

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

 

Opening Pandora's Box: Gene editing and its consequences

Bacteriophage viruses infecting bacterial cells , Bacterial viruses. from www.shutterstock.com

Courtesy of John Bergeron, McGill University

Today, the scientific community is aghast at the prospect of gene editing to create “designer” humans. Gene editing may be of greater consequence than climate change, or even the consequences of unleashing the energy of the atom.

...

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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...



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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

Free eBook - "My Top Strategies for 2017"

 

 

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Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

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

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

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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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