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Wednesday Rebound – Russell Jumps 3% Pre-Market

ImageIs this Democratic Rotation?

With the Democrats looking to take both Senate seats (and control of the Senate) away from the Republicans, the small-cap Russell 2000 Index has gone crazy this morning, jumping 3% pre-market on the assumption that the first thing Joe Biden will want to do is make America great again for small businesses and the middle class.  The Nasdaq, on the other hand, has become a haven for Oligopolists and there may be some trust-busting coming their way as now Tech is becomming "too big to fail".  

”The market is pulling in implications of what a Democrat win would mean for the economic recovery,” said Peter Rosenstreich, head of market strategy at Swissquote Bank. “Expected increase in fiscal stimulus and infrastructure spending would bode well for cyclical or growth stocks. Tech stocks may not benefit as much, and that may have something to do with their stretched valuations.”

As we know from our fabulous 5% Rule™, 3% is too much for an index to move in a session so we should expect at least a 0.5% retrace (10 points) back from the 2,040 line on /RTY (Russell Futures) back to 2,030 and, if that fails, another 10 points to 2,020 will be the proper test so see if we're going to hold the bullish uptrend.  

Meanwhile, speaking of Oiligarchs, 53 people were arrested in Hong Kong this morning for the crime of "subverting state power" during the pro-democracy sessions last summer.  In a blatant display of Fascist refusal to recognize the Democratic process, the majority party refused to allow a newly elected official to be sworn in – promting a walk-out by the minority party in protest.  

Oh, wait a minute, that happened in Pennsylvania, not China.  China hasn't gone that far off the rails yet…  

Republican Sen. Jake Corman, the top-ranking senator, said Monday he wouldn’t permit Mr. Brewster to be sworn in because of Ms. Ziccarelli’s pending lawsuit in federal court. The suit alleges that the Allegheny County Board of Elections improperly counted mail-in ballots that were signed but undated. In late November, the state Supreme Court ruled against Ms. Ziccarelli, finding that a missing date wasn’t a reason to invalidate a ballot.


“Ziccarelli’s position is that Pennsylvania election law is entirely clear that voters must sign and date their mail-in ballot to be counted,” Mr. Corman said in a statement.

Democratic state Sen. Jay Costa, the Senate minority leader, tweeted Tuesday, “A leader who ignores the will of voters and refuses to seat a duly elected Senator – is no leader at all…We are not going to bear witness to this sham.”

People, this is now going way too far.  We have seen all kinds of crazy political crap go on in other countries but I have never, in my lifetime, seen a duly elected offical be rejected by the opposing party.  Sure, they object all the time.  They impeach, they investigate – but they don't refuse to follow the process – this is no longer America if we allow this to happen!  

Following the rules is not optional.  Politics isn't a board game where the best cheater wins (but it is a game where the Banker always wins, unfortunately).  We are teetering on the verge of Anarchy and the Anarchist in Chief is still challenging his own election defeat – even though he lost by 7M votes.  In fact, Mike Pence is due to certify Joe Biden's win this afternoon but what if he doesn't?  We don't even have a rule for what to do there because it's UNTHINKABLE.

Gazette opinion: Pence should live up to his own beliefs | Editorial |  billingsgazette.comU.S. states have already certified the results, and Pence’s role on Wednesday as president of the Senate is to “open all the certificates,” in the presence of the House of Representatives and the Senate, the U.S. Constitution says.  Trump suggested Pence could do more than that.  “The Vice President has the power to reject fraudulently chosen electors,” Trump wrote in a tweet, his latest unfounded suggestion that the election was marred by widespread fraud.

“The Vice President and I are in total agreement that the Vice President has the power to act,” Trump said. “Our Vice President has several options under the U.S. Constitution. He can decertify the results or send them back to the states for change and certification.”

“If he doesn’t come through, I won’t like him quite as much,” Trump said.

Meanwhile, as if facts matter, Private Payrolls dropped 123,000 in December vs gains of 75,000 expected by leading economororns.  This 400% miss is more likely to boost the market than to harm it, however as it clearly shows we need MORE FREE MONEY.  This is a very harsh reversal from November's + 304,000, reflecting the lockdowns coming back into effect just after Thanskgiving.  

We have Fed Minutes this afternoon at 2pm and early earnings come out tomorrow but now the focus will be on Friday's Non-Farm Payroll Report to see if we can hold these record-highs.


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  1. Good Morning. Really. 

  2. Love the extra space!

  3. So much winning! Please Mr. President, we need to stop winning, we are tired of winning!

    In other news, there is now only on small D democratic party in the USA! Thankfully, the autocratic party being rejected last night.

  4. China's influence:

  5. Good morning, everyone and Happy, Healthy and Prosperous New Year!

    Here is the link to today's webinar….

  6. LOL. Now they are delisting the Chinese Telecoms.  Oye ve.

  7. Well, I see my X play is now ITM.  Nicey nice!

  8. Pharm you still did not explain your X play of yesterday properly. Possible I am dump to understand.

  9. Yodi,

    Pharm did; six minutes after your inquiry. 

    X stock is 18.08 or so. If called away at $20, you get 1.92 + 1.12 (Feb $20C) = 3.04.

    3.04/16.98 is ….. wait for it…. 17%.

  10. I see here on TV we have an other corona party in Washington

  11. randers1 Thanks I understand the Math but the Feb 21 20 call was trading yesterday only at some .85 cents. not 1.12 

  12. Yodi/X – I was able to sell the Feb $20 for $1.09

  13. CHL?


    What are everyone's thoughts?  I have a Jan2022 27.5 call option that has no bid price (today)…  Would it make sense that if CHL gets does get "relisted" that my option will still be in effect (assuming it is prior to Jan2022)?

    Is there any precedent for this?

  14. daveo I do not want to labor the subject but I checked the option at the time and it was trading for .85 and that confused me. Obviously if you wait long enough as now you could get 2.32. Just a matter of timing.

  15. Yodi/party  Only a schweinhund would attend…. 



  16. Good morning!

    Big Chart – 3,780 is the 20% line on /ES so keep an eye on that.  Bad news is good news from ADP and PMI was slower too at 54.8 but Factory Orders are up 1% but slowing from up 1.3% last month.  Oil had a good draw (8M) so the indexes are generally happy about that but it was really a net build so I'm looking for a shorting opportunity:

    • EIA Petroleum Inventories: Crude -8.0M barrels vs. -2.1M consensus, -6.1M last week.
    • EIA Gasoline +4.5barrels vs. +1.5M consensus, -1.2M last week.
    • EIA Distillates +6.4M barrels vs. +2.3M consensus, +3.1M last week.
    • Futures (CL1:COM +0.4%)

    CHL back to delisting so anyone who want's to get off the roller-coaster should do so – or at least get some covers.

    • Movie theater chain AMC Entertainment (NYSE:AMC) gained 6.6% after Dow Jones reported that the company in talks for a European financing deal.
    • AMC in talks for its U.K. unit Odeon to borrow up to GBP300m; AMC is in talks with Apollo (NYSE:APO), others for deal backed by European assets
    • Yesterday, AMC CEO Adam Aron said he's still hunting for half a billion dollars in liquidity to operate the theater chain through 2021
    • RH (RH +2.6%) makes an initial equity investment of ~$105M in connection with real estate development initiatives in Aspen, Colorado, that includes properties to be developed into retail locations, hospitality concepts, residential developments, and workforce housing projects.
    • Under the transaction, Aspen selected to develop the first RH Ecosystem, inclusive of an RH Gallery, RH Guesthouse, RH Bath House & Spa, RH Restaurants and RH Residences.
    • The equity investment is funded from its existing cash balances.
    • The Company plans to operate the RH branded businesses as part of the Aspen ecosystem and to be a real estate investor and partner for the remaining properties.
    • RH plans to open the RH Gallery on Galena, and the RH Guesthouse at the Historic Crystal Palace, which will include the Company’s first RH Bath House & Spa, in 2022.
    • Cowen Washington Research Group analyst Jaret Seiberg weighs in the shockwaves in the cannabis sector from the Georgia Senate runoff elections.
    • Sienerg thinks the STATES Act is most likely of the pending legislation as it could move regardless of what happens to the filibuster. He says the MORE Act becomes possible absent filibuster, though it is seen as possibly a step too far for moderate Democrats
    • "In either case, we expect Congress will give cannabis companies access to commercial banking and insurance. We also see medical cannabis being protected. Capital markets access is largely dependent upon enactment of either the STATES Act or the MORE Act."
    • What could go wrong? Sieberg warns if Congress quickly passes the SAFE Act, which gives cannabis companies access to commercial banking and insurance, that could rob cannabis of the momentum needed to get to legalization before the 2022 midterm election.
    • Tilray (TLRY +15.2%), Canopy Growth (CGC +16.2%), HEXO (HEXO +13.7%), Cronos (CRON +12.3%), OrganiGram (OGI +11.9%) and Orchard Therapeutics (ORTX +40.2%) are leading the pack of cannabis stocks holding on to their gains off the Georgia Senate election buzz.
    • John Stephens, CFO of AT&T (T +1.1%says significant investment in network performance with attractive wireless device pricing for new and existing customers should continue to drive migrations to unlimited plans and momentum in the company's wireless business.
    • The company expects to generate free cash flow of $26B in 2021 with a payout ratio of 50%, built upon management's guidance of at least $26B of free cash flow in 2020.
    • The company has refinanced more than $60B of debt at historically low rates and reduced its amount of debt coming due through 2025 by about $30B.
    • Q4 results will be out on Jan 27.
    • Ford (F +1.6%reports U.S. sales fell 9.8% in Q4 to 542,749 vehicles to beat the consensus expectation of a 14% drop.
    • Total retails sales fell 3.4% Y/Y.
    • Truck sales declined 12.5% to 288,698 units, SUV sales grew 4% to 216,732 units and car sales plunged 41.1% to 37,319 units.
    • F-Series sales dropped 15.2% to 198,388 units for the quarter, F-150 sales were off 32.7%.
    • “Fourth quarter represented an inflection point at Ford in our transition from cars to a much greater focus on iconic trucks, SUVs and electric vehicles to better serve our customers. We began to see our strongest evidence of this in December with retail sales up 5.3 percent with the launch of our new F-150, Bronco Sport and Mustang Mach-E. We are well positioned to see the benefits of our focused efforts throughout 2021.” – Andrew Frick, vice president, Ford Sales U.S. and Canada
    • November Factory Orders+1% vs. +0.7% consensus and +1.3% prior (revised from +1%).
    • Shipments +0.7%.
    • Unfilled orders -0.1%.
    • Carnival (CCL -1.9%) says customers have been notified that it is extending its pause in all operations from all U.S. homeports through March 31, as well as select ships and homeport operations related to itineraries and dry dock work.
    • Booked guests were given options for a future cruise credit and onboard credit package or a full refund.
    • The company has extended cruise cancellations on an almost monthly basis due to COVID-19 developments.
    • The rally in Carnival off positive vaccine news in December was short lived.
    • December PMI Composite Index: 55.3 vs. 55.7 consensus and 58.6 prior.
    • Service: 54.8 vs. 55.3 consensus and 58.4 prior.
    • Output and new order growth ease from November's peaks.
    • Cost burdens rise at survey-record pace.
    • Business expectations moderate amid pandemic uncertainty.

  17. Democrat or idiot I would not risk my health for that clown.

  18. Looking forward to the orange schweinhund himself… 



  19. These people I see there on TV all have kaka in their cabesa.

  20. Still an empty stage possible he does not get his yellow wig right

  21. It is incredible to see a clown talking so much trash to a bunch of crazy people. and the world still can see such a fool. The king ???? without cloth.

  22. Was für eine Blamage für America diesen Clown zu sehen und was für einen Mist er redet. I changed the channel 

  23. BA has a weekly bull flag. I am easing into the March 250 Cs for ~6.35.  This is a big OTM risk, but IF airlines start to recover due to the vaccine….look out.

  24. Whoa….The polar vortex is splitting in two, which may lead to weeks of wild winter weather

  25. GLD has now back filled the gap. One wants to dip their toes in, the Feb 180Cs for 4.20 are a good way to start. Selling 1/2 of the Jan 182s for 1.14 or so.

  26. SO….buy the stock and sell the strangle Jan23 62.5/50 C/P for net $50.85.  Oil and Utilities are supposed to do well.

  27. CHL down 6% .. big Don buying on the self generated dip .. must need money for TrumpTV.

  28. We can hear you!  :)

  29. Webinar today?

  30. sorry got it :)

  31. LOL. Now pro-Trump protestors are storming the Capital….what a cluster'f has become of this country after Trump.

  32. Trump Tweet that is causing the riot…..nice.

  33. In a different country, the news would be about a coup attempt! These GOP clowns have unleashed a force that they won't be able to control now! Now Pence and Grassley have been taken a secure location! 

    Can you imagine if this was a BLM protest? 

  34. Capital Police said that Congress needs to have their gas masks ready.

    Mayor of DC has mandated a curfew. How many more days??

  35. Pharm/Riot
    I congratulate (insert your sarcasm emoji here) your (even though I am a naturalized citizen and have served in the military, I still consider myself fortunate to have been allowed to live here and believe I am a guest here) country. The beginining of the end of democracy was 4 years ago.

    Today is the culmination of that process and we now have an autocracy. Absolutely no different from the African dictatorships I personally experienced in the 20th century.


  36. What a disaster!

  37. How the f*ck did the protestors get in the senate chamber? Is anyone in charge?


    Where's Al Haig when we need him?!!!

  38. Protestors milling around the senate chamber and doing who knows…WTF?


    BLM protestors would be 'finished' by now….

  39. 1020 – apparently – the DC mayor asked for national guard and they were no allowed to be at the capital……  Now the speaker of the House is asking for the National guard to be deployed and TRUMP is sitting on order ( or his disciples) …

  40. Simply FUBAR….

  41. Trouble believing this crap at the Capitol. 

    Unbelievable that a random collection of untrained folks could get inside the Capitol building. Politics aside, it's the Capitol Police to blame not Trump. They were supposed to protect the Capitol. If they weren't able to stop an undisciplined mob from penetrating the defenses of the nation's capitol buildings how would they do against trained adversaries? Brings to mind the fictional cinematic dramas about terrorists successfully taking over the White House (Olympus Has Fallen) and blowing up Congress (Lone Survivor).

    In a sense Trump did the country a favor by focusing attention on our incredible lack of preparedness.

  42. FUBAR … SNAFU from an earlier war.

  43. Holy crap! 

    What the Hell happened during my webinar?

    Polar vortex/Pharm – May lead to really bad things. 

    Riot/Maya – This is madness!  I am dumbfounded that this has happened to our country in just 4 years.  

    As 1020 says, how the F did they get in the Senate chamber?  They knew there would be a protest, where are the police?  Were they pulled away?  

    Guard/Batman – This is crazy.  What a signal that we can't protect our own Capitol from chaos.  

  44. Found a new description of a tdump supporter….  ;)

  45. We protect our capital like we protect our cyber security….. :(

  46. Now some president supporter senator is asking the president 'to do something'!

    He has already done what he wanted to do! What do you mean 'do something'? This is what he has done! Do you think there will be any legal repercussions for him?

    Spineless, self serving senate has been accomplice to this…. What democracy does the US have, again??

    I want to throw up…

  47. Riot at D.C. capital and portfolio solidly in the green.  Check….

  48. Meanwhile, this weekly TSLA $800 calls were sellable for $4.70, now $2.50.

  49. Ahh, tomorrow the markets will be up 1000pts. More free monkey money… :)

  50. Might have to impeach Trump again or invoke the 25th amendment!

    In the meantime, mission accomplished. No election certification today! 

  51. Riots/After hours

    The republican led senate had 4 years to call their supreme leader out on all his shenannigans. However, they had their own selfish motives for playing along with him. And now some have the gall to say 'This is not who we are'. Sorry, but this exactly who we are or have become in the past 4 years.

    People, especially the senate republicans only thought of themselves, as long as they were getting rich along with him.

    while the dollar may be the all important aspect of life here (and even the dollar is no longer 'mighty') for the rich and as.. licking, we won't know the value of what we have lost until it's too late.

    I can attest to that from experience. It was not fun being shot at, just for being a student…all because the dictator in that country could do whatever he wanted and people lived in fear. Theirs was also called a 'democracy'. A 'one party' democracy, it was called and the ruling class there also sang the same tunes as we hear today in the US from the Commandant.

    EVERY republican senator NEEDED to do something today, and over the past 4 years for that matter. 
    We had a democracy in name only…

    OK, I feel a little better now, but nausea will linger for much longer, I am afraid!

  52. I've never been so embarrassed to be an American.  What a shameful country we've become.

  53. I've gotten calls today from people overseas from Singapore, China, Taiwan, Ireland….  These are people I haven't talked to in a long time and never talked politics.       checking in on my well being… as we'll as trying to understand what is being done to reign this man in….  I'm at a loss…   Trunp ensured there was not enough protection today…. then he unleashed this insurrection on the Capital….  He tied the police, National Guard;s hands then unleashed his followers on our Capital.  …   

    Article 25 must be invoked!!!!!!!   I don't care if it's pence or McConnel or Pelosi –  We need him stopped and out of power. TODAY…..  

  54. The SPAC Bubble May Burst—and Not a Day Too Soon

  55. Trump Must Pay | National Review

  56. This Is a Coup

  57. Airlines to Try Ultra-Cheap Fares to Get the World Flying

  58. Hi guys We have discussed the subject many times on this site. I can only say the world is shocked about the disarranged clown's action. Even Putin must have been surprised about the action of his pupil. The best thing the US could do is lock him away TODAY. The man is NOT NORMAL in his head. A danger to humanity. Regretfully the bullets fired yesterday at the capitol hit the wrong person.
    Besides the problem with corona I sincerely hope we will enter a more peaceful time.