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Saturday, March 2, 2024

Friday Futures Fakery – Do you REALLY think a downed airline doesn’t matter?

Can we possibly be this jaded? 

Even on Wall Street, where ruining the lives of the middle class is a sporting event, you would think that the tragic death of 298 people being shot down in an airplane would AT LEAST cause the markets to pause for more than a few hours.  That's not what the Futures would have you believe – they are moving up this morning (7:30) as if shooting planes out of the sky isn't a reason not to trade stocks at their all-time highs

While our long trade ideas from yesterday's morning post worked out fantastically, we were very fortunately NOT GREEDY at 10:03, when I said to our Members:

Philly Fed up huge (like NY), 23.9 vs 10 expected though 17.8 last month means they were just being too pessimistic.  That should give us a nice pop but I'd take those Futures profits off this run!  

SPY 5 MINUTEAs you can see from Dave Fry's SPY chart, our timing was near perfect as things turned sour very quickly.  That then worked out well for our oil shorts, which went from the $103 conviction target I laid out in the morning post (subscribe here to get them pre-market every day) back below $102, where I said to our Members at 11:34:

There goes $102 on oil!  Congrats to the players!  That's the new stop line, of course. 

That was a very quick $1,000 PER CONTRACT profit on /CL and, right after that, we got the plane crash news so we increased our hedges in our Short-Term Portfolio and we added BA July $128 puts at $1.25 (because it was a BA plane involved in the incident) and they finished the day at $2.18 (up 74%) as well as DAL Aug $37 puts at $1.50, which were already $1.92 by the day's end (up 28%).  I don't like to take advantage of tragedies like that – but it was the fastest way to add good protection to our portfolios.  

YUM had a bit of a tragedy yesterday and the net 0.30 bearish trade we featured for you in yesterday's morning post (from our live Member Chat at 1:57 on Wednesday) hit $1.75 during the session and we were able to cash in with a 683%, one-day gain!  I'm a lot happier with that one (and our LVS and EBAY plays, which were also winners) than I am about BA and DAL, but it's our JOB to use the news to our advantage – even when it is tragic.  

Those USO Aug $39 puts we picked yesterday morning (and these are just the FREE ideas!) finished the day at $1.44, despite oil jumping up over $103, so we're very happy with those and will be looking forward to things calming down a bit in the near futures.  It's not just airline attacks, we also had Israel moving into the Gaza yesterday and, even though neither one of them have any oil – anything in the middle east is an excuse to pump oil up into the weekend so they can rape you at the pumps. 

We took a long poke at the Russell Futures (/TF) this morning but all nickels and dimes so far, which means the morning "bounce" is weak and we're more likely to go down than up – but it's a very tricky call with today being July Options Expriations.  

Still, I certainly wouldn't go into this weekend without some serious hedges!  We'll discuss some more of those strategies in today's Member Chat.  

Have a great weekend,

– Phil



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