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Philstockworld April Top Trade Review

Image result for top trade ideasYes, this is Monday morning's Report.

I don't have much to say about the markets, they are back near the highs and we'll see if they hold tomorrow, not today, as it's Monday and Monday's don't matter.  What we do need to do is bargain-hunt in case it is a real rally and the best way to do that is to look back on past trade ideas and see if we can find some that haven't gone up yet.  

We did our last Top Trade Review in Marchso it's a good time to do one of those and, as our Members well know, the vast majority of those trades turn positive so, when they're not, it's usually just a matter of time.  As of the March review, we had looked at Top Trades that were initiated through July and, out of 32 trade ideas in 30 weeks, we had 24 winners and 8 losers but 2 of the winners turned around by Sept and that left is with 26 wins and 6 losses for a very solid 81.25% winning percentatge.

Our Top Trades are what we think are our best trade ideas of the week with the highest chances of winning and we send out Alerts to our Members via Text and Email but we don't have a specific portfolio for them as they ofen ended up in one of our 5 various Member Portfolios already.  

There's a bit of randomness to the reviews in that we check in on trades after roughly 6 months so they are usually in progress and may be randomly up or down at the moment but that's why these reviews are so great for identifying bargains that simply haven't made a move yet.  These are the Top Trade Ideas for August and September:

Tuesday, Aug 1st: Teva (TEVA) – We felt TEVA has bottomed out in early Aug but we were wrong and it did go a lot lower before bouncing back.  Our trade idea was:

As a new

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The Forward P/E Ratio Has Collapsed


The Forward P/E Ratio Has Collapsed

Courtesy of 

James Mackintosh notes that the recent correction in the S&P 500 has brought valuations down enough for it to be noticeable.

From the Wall Street Journal:

Only once before have U.S. earnings expectations risen so far, or so fast, as they have this year. Yet, investors couldn’t care less as shares are down. The result is that Wall Street’s favorite valuation measure has fallen at a speed usually only seen in a crisis.

That doesn’t mean stocks are a screaming bargain. But the 12-month forward price/earnings ratio on the S&P 500 has fallen from a 16-year high of 18.6 times adjusted earnings at the end of January to 16.4 times at Tuesday’s close, putting it back to where it stood in 2014

He says that this sort of thing has only really happened before or during crisis periods, like the blowup of Long Term Capital Management in 1998 or the Greek debt crisis in 2010.

I don’t know of any current crises happening today but maybe market participants believe one is on the way?

Or, as Ben Carlson described yesterday, it’s just that multiples are coming down as lower-risk Treasury bonds are offering more competition for capital, now that there’s a yield attached to them.

From A Wealth Of Common Sense:

Rising interest rates and their impact on stock market performance should also be considered from an asset-allocation perspective. Investor capital has to go somewhere — stocks, bonds, cash, real estate or alternative investments — and those allocation decisions are often driven more by relative value than absolute value.

I’d also point out that part of the reason for the collapse in forward P/E, beyond just the fact that stocks have fallen from their highs, is that earnings estimates have shot up during the course of the year. We go into Q2 earnings season with the consensus expecting 18% growth. That same consensus was at 12% growth for S&P earnings when 2018 began.

Stock investors on higher floors take more risks – here’s why


Stock investors on higher floors take more risks – here's why

File 20180409 114092 5pnx2l.jpg?ixlib=rb 1.1

Do Wall Street’s high-rises fuel risky behavior? ErickN/

Courtesy of Sina Esteky, Miami University

Stocks have been on a bumpy ride lately as concerns over a trade war prompt investors to rethink their appetite for risk.

But what prompts people to take risks in the first place? A desire for wealth? Fear of failure? Personality? Gender? Age? Education? Race?

While studies have found that each can play a role, research I recently conducted with colleagues found another surprising factor: their location inside buildings, specifically their distance from street level.

Business and the environment

Winston Churchill, himself known as a risk-taker, famously said: “We shape our buildings and afterwards our buildings shape us.”

Yet over 75 years since Churchill said this, we still don’t know all that much about the role buildings play in shaping how we behave.

Winston Churchill understood that buildings can affect our behavior. AP Photo

While our understanding of the human psyche and behavior has changed radically over the past few decades thanks to advancements in various branches of psychology and neuroscience, study of the link between humans and their physical environment seems to have mostly been on hiatus since the 1970s.

Despite this, a peculiar group of academics have made great strides in recent years when it comes to understanding human-environment interactions: business researchers.

A growing number of scholars in business schools – including my own – have been investigating how people’s financial and consumer decisions are affected by factors in the built environment. Labels have emerged to describe these findings, such as “atmospherics,” “sensory marketing,” “servicescapes” and “embodied/grounded cognition.”

For instance, studies have shown that people are more creative in rooms with high ceilings, more likely to vote in favor of educational initiatives when they are physically in a school, seek more variety when shopping in narrow aisles, prefer romantic movies in cold rooms and are more likely
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Facebook’s social responsibility should include privacy protection


Facebook's social responsibility should include privacy protection

File 20180411 536 1b7n5pb.jpg?ixlib=rb 1.1

Does this man understand how his company can be a responsible member of society? AP Photo/Pablo Martinez Monsivais

Courtesy of Scott Shackelford, Indiana University

In his congressional testimony, Facebook founder and CEO Mark Zuckerberg seemed to understand the importance of protecting both the security and privacy of Facebook’s 2.2 billion users. People in the United States have come to realize the power of technology companies in their daily lives – and in politics. As a result, what they expect of those companies is changing. That’s why I believe, privacy protection must now become part of what has been called corporate social responsibility.

To its credit, the massive social network has begun taking action. Zuckerberg has promised the company will apply the protections of the European Union’s General Data Protection Regulation to all users around the world. It will also require political advertisers to provide additional transparency, as a new weapon in the reported “arms race” Facebook finds itself in with Russian propagandists. And the company is partnering with researchers to better understand its role in elections.

But there are those in Congress and in Europe who don’t think Facebook has gone far enough yet. European Data Protection Supervisor Giovanni Buttarelli, for example, has suggested Facebook views its users as “experimental rats.”

In my view as a scholar of law and ethics in the technology industry, Facebook – and other leading tech firms such as Google and Twitter – should join nations around the world and declare that privacy and cybersecurity are human rights that must be respected.

It’s not enough to just connect more people

Zuckerberg himself has already embraced the idea that internet access is a human right. And his company is planning to “connect the next 5 billion people” who have yet to go online. That will, of course, also create plenty more Facebook users just as the company’s growth plateaus in the West.

Several countries – as varied as France, Finland, Costa Rica and Estonia – have also taken the stance that …
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TGI Friday the 13th – Bulls are Feeling Lucky

We're still waiting on a few of bounce lines:

  • Dow 23,800 (weak) and 24,200 (strong)
  • S&P 2,640 (weak) and 2,684 (strong)
  • Nasdaq 6,500 (weak) and 6,700 (strong)
  • NYSE 12,450 (weak) and 12,600 (strong)
  • Russell 1,520 (weak) and 1,540 (strong)

Even with this morning's pre-market rally, we still have to take the same 3 red levels we were looking for yesterday so we'll have to remain well-hedged into the weekend because we don't change our stance until at least 3 of five of the Strong Bounce levels are captured AND HELD – for at least one full day after a close above.

As you can see on the chart, 2,693 is the 50-day moving average on the S&P 500 so that's the real goal as it needs to be over that line to avoid (or at least put off) forming a "death cross" below the 200 dma into July earnings.  Remember, we predicted strong bank earnings in our Big Bank Theory Report last Thursday and our Trade Idea for Citigroup (C) is looking very good as they have already jumped $4 since we made the play:

The markets are generally back to bullish as Trump walks back threats against Syria and, more importantly, says he may want to put us back in the Trans Pacific Partnership (…
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Will it hold?


Will it hold?

Courtesy of 

The current liberal fantasy: Special Counsel Robert Mueller will present a series of reports to Congress about the activities of the Trump campaign during and after the election along with some indictments, including one for the President for obstruction of justice. Congress will then begin impeachment proceedings and remove the President from office, ushering in the Pence administration, followed in short order by a Blue Wave in the 2018 midterms that renders Mr. Pence impotent (legislatively speaking).

Okay. Maybe.

Or…and I’m just thinking out loud here…we have another Saturday Night Massacre, wherein Rosenstein and Wray are removed from office, the new appointee at the top of the Justice Department ends the investigation with the stroke of a pen and everyone freaks out for a week, followed by some other distraction, like a surprise Kardashian pregnancy or another Hollywood star being outed as a abuser of women. Then we all gear up for the new NFL season and President Trump cruises into a third chaotic year in office.

Which one of these outcomes is better for the mental health of the investor class? Maybe neither. Maybe the Constitutional Crisis brinksmanship pushes us through the floor established this past winter at around 2550 and then permanently puts risk appetites on a downward slope for the cycle.

I don’t think a rational person could believe they possibly know which of these things will happen but I do think it’s rational to say neither is good for sentiment.

Is it too hopeful to expect a third attempt on the support level in this market to resolve in a bounce? Is it more reasonable to believe that a third attempt will be the straw that breaks the camel’s back and takes us out of a trendless consolidation and firmly into a downtrend?

As you can see in the chart above, we’re down from the highs. In the bottom pane you’re looking at the percentage of S&P 500 stocks that are currently above the 200-day moving average – 56% of them are, meaning more than half of the market’s stocks are still in an…
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Thrilling Thursday – Quick Gains Made Shorting Oil and Gasoline as OPEC Loses Control


As you can see from the chart, we made just under $2,500 shorting Gasoline (/RB) futures into yesterday's run-up after inventories.  We also picked up $1,560 on our oil shorts so all is very, very well this morning despite a slow week trading futures (it's generally been too crazy to risk). 

Things are still risky but we had a net build in EIA inventories yesterday so the Fundamentals were bearish and oil spiked up on Syria fears but Syria themselves are not big suppliers of oil and the real news is OPEC, for the 5th time this year, being forced to admit the rest of the World is simply filling the gap of their production cuts (now 1.8Mb/d) with overall Global Supply UP 180,000 barrels a day led by the US adding 1.5Mb/d – mainly from shale production.  

There's simply no Fundamental reason for oil to be over $65 so, yesterday, when we got that silly spike up on oil after the weak Inventory Report, I said to our Members:

Wow, that was a crazy reverse on /CL.  I'm back short at $67.45 with a stop over $67.50 – I dare them!  /RB too at $2.075 – ridiculous!  

As you can see, $67.45 turned out to be the dead to – perhaps BECAUSE we called it but we'll take the win either way and we'll certainly take the $1,560 profit!  This morning we stopped out back over $66.50 but we're happy to go back short on /CL below that line with tight stops above.   The Dollar is back over $89.50 and, as long as we hold that line – I'll be liking the oil short but we should be thrilled to take $500/contract gains at $66 as it's still almost the weekend – which is a very dangerous time to be shorting oil.

If you are Futures-challenged and want to make a longer-term play against oil prices, the Ultra-Short ETF (SCO) is down at $18.78 and we can play to get out before the May Holiday weekend with the May (18th) $18 ($1.70)/$20 (0.85) bull call spread at 0.85 on the $2

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To serve a free society, social media must evolve beyond data mining


To serve a free society, social media must evolve beyond data mining

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Social media companies combine many pieces of information into a complex digital profile. Tetiana Yurchenko/

Courtesy of Aram Sinnreich, American University School of Communication and Barbara Romzek, American University School of Public Affairs

As Congress and the public wrestle with the Facebook-Cambridge Analytica scandal, many people are now realizing the risks data collection poses to civic institutions, public discourse and individual privacy. The U.K.-based political consulting firm didn’t just collect personal data from the 270,000 people who used researcher Aleksandr Kogan’s online personality quiz – nor was the damage limited to 87 million of their friends. Facebook recently revealed that nearly all of its 2.2 billion users have had data scraped by “malicious” people or companies. The firm itself has joined calls for better privacy regulations.

For years, watchdogs have been warning about sharing information with data-collecting companies, firms engaged in the relatively new line of business called some academics have called “surveillance capitalism.” Most casual internet users are only now realizing how easy – and common – it is for unaccountable and unknown organizations to assemble detailed digital profiles of them. They do this by combining the discrete bits of information consumers have given up to e-tailers, health sites, quiz apps and countless other digital services.

As scholars of public accountability and digital media systems, we know that the business of social media is based on extracting user data and offering it for sale. There’s no simple way for them to protect data as many users might expect. Like the social pollution of fake news, bullying and spam that Facebook’s platform spreads, the company’s privacy crisis also stems from a power imbalance: Facebook knows nearly everything about its users, who know little to nothing about it.

It’s not enough for people to delete their Facebook accounts. Nor is it likely that anyone will successfully replace it with a nonprofit alternative centering on privacy, transparency and accountability. Furthermore, this problem is not specific just to Facebook. Other companies, including Google and Amazon, also …
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What Now Wednesday – Trump’s Manic Tweets Cost Markets Half Their Gains

He's at it again.

In a tweet that was so bad at 7am that they have already pulled it by 8, Trump pushes the Nuclear Clock to 11:59:59.9 by threatening Syria and Russia with missile strikes.  Remember when Trump said you shouldn't tell your enemies your plans in advance?  Too bad he didn't stick to that. 

The tweet may be gone but the damage is done and the Futures have already given back half of yesterday's silly gains and it's going to be a busy data day with Fed Minutes at 2pm (which was going to bring down the markets anyway) but CPI is coming right up and Atlanta Fed is at 10, EIA at 10:30, a 10-year note auction at 1pm (we're borrowing $21Bn this week) and Bed Bath and Beyond earnings after the close, which I think will be very telling.

Of course, Trump can't stay mad at his Putie for too long and his last tweet (so far) has offered to reconcile by offering to "help with their (Russia's) economy" and "stop the arms race" Trump just started by cliaming to have "nice, new and smart" missiles.  

As noted by Bloomberg, A strike that hits Russian assets in Syria — even if unintentionally — could result in a dangerous game of one-upmanship, potentially dragging the U.S. further into a conflict the president wants to leave. Oil prices rose after Trump’s remarks, while U.S. stock futures fell and the Russian ruble slumped to the lowest level in 16 months.  Russia has already strengthened Syria’s air-defense capabilities, deploying S-400 missile batteries after U.S. strikes a year ago hit a Syrian base.

Image result for trump putin nuclearThe most important thing about a U.S. strike is the potential for Russian casualties as a result of any military activity there,” said Ayham Kamel, head of Middle East and North Africa research at Eurasia Group. “That is where there’s a risk of an escalatory cycle that would be much more meaningful than attacking Assad’s forces.”  In March, Valery Gerasimov, chief of Russia’s General Staff, already warned the US that “in the event a threat arises to the lives of our servicemen, the Armed Forces of Russia will take retaliatory measures
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Chart o’ the Day: No, it’s not all tech stocks


Chart o’ the Day: No, it’s not all tech stocks

Courtesy of 

The US stock market has absolutely creamed international stock markets in the post-crisis recovery – at a rate of 2.5 to 1 by some measures.

This has led to a popular misconception that it was the US indices’ weighting toward a few giant technology stocks that happened to have done really well (tech represents 25% of the S&P 500 but just 12% of the MSCI All Country World Index).

JP Morgan Asset Management begs to differ. I’m making their chart of the week my chart of the day today.

Below, you’ll see that the outperformance of US stocks vs international stocks even when we strip tech stock exposure out of both indices:

Some investors wonder if without technology, this outperformance would still exist. As shown in this week’s chart, the answer is yes – removing tech from both indices leads the performance differential to narrow, but still points to U.S. outperformance. Furthermore, the S&P 500’s robust performance excluding tech highlights that this bull market has been about more than a single sector.


Weekly Market Recap 
JP Morgan Asset Management – April 9th, 2018


Zero Hedge

Facebook Moves 1.5 Billion Users' Data Out Of Europe To Circumvent New Privacy Law

Courtesy of ZeroHedge. View original post here.

This doesn't bode well for Facebook CEO Mark Zuckerberg and what remains of his tattered credibility.

After Zuck suggested (but stopping short of promising) during testimony before Congress last week that he would treat all Facebook users' data as if it fell under the European Union...

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Phil's Favorites

Trump's exports-good, imports-bad trade policy, debunked by an economist


Trump's exports-good, imports-bad trade policy, debunked by an economist

The White House frets about how the U.S. imports more stuff than it exports. AP Photo/Ben Margot

Courtesy of Ian Sheldon, The Ohio State University

President Donald Trump’s trade policy leaves international economists like me scratching our heads.

His apparent desire to start a ...

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Digital Currencies

Cryptos Continue To Surge As Tax-Day Passes

Courtesy of ZeroHedge. View original post here.

Crytpocurrencies are continuing their post-tax-day gains with Bitcoin above $8500, Ethereum at almost $600, and Ripple up over 30% on the week.

With Bitcoin back above $8,500...

And Ethererum is back above $550 - testing towards $600...

Certainly for now, the anecdotal performa...

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Insider Scoop

Cowen Says The Big Sell-Off In Skechers Is A Buying Opportunity

Courtesy of Benzinga.

Related SKX 25 Stocks Moving In Friday's Mid-Day Session Mid-Day Market Update: Skechers USA Falls After Weak Q2 Guidance; Ericsson Shares Climb... more from Insider

Chart School

Short Opportunity II

Courtesy of Declan.

The first chance for a short play got burned but there is a second one on offer for the S&P.

The S&P tagged channel resistance and while today's reversal off resistance didn't amount to a big percentage loss it did register as a distribution day. There wasn't any significant technical change so if this short does evolve it will do so with risk measured on a move above 2,717.

The Nasdaq may match a 'bearish evening star' but if this is the case there has to be a significant move lower tomor...

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Buffett At His Best

By csinvesting. Originally published at ValueWalk.

Bear with me as I share a bit of my history that helped me create SkyVu and the Battle Bears games. The University of Nebraska gave me my first job after college. I mostly pushed TV carts around, edited videos for professors or the occasional speaker event. One day, Warren Buffet came to campus to speak to the College of Business. I didn’t think much of this speech at the time but I saved it for some reason. 15 years later, as a founder of my own company, I watch and listen to this particular speech every year to remind myself of the fundamentals and values Mr. Buffett looks for. He’s addressing business students at his alma mater, so I think his style here is a bit more ‘close to home’ than in his other speeches. Hopefully many of you find great value in this video like I have. Sorry for the VHS...

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Kimble Charting Solutions

The Stock Bull Market Stops Here!


The Stock Bull Market Stops Here!

Courtesy of Kimble Charting


The definition of a bull market or bull trends widely vary. One of the more common criteria for bull markets is determined by the asset being above or below its 200 day moving average.

In my humble opinion, each index above remains in a bull trend, as triple support (200-day moving averages, 2-year rising support lines, and February lows) are still in play ...

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Members' Corner

Cambridge Analytica and the 2016 Election: What you need to know (updated)


"If you want to fundamentally reshape society, you first have to break it." ~ Christopher Wylie

[Interview: Cambridge Analytica whistleblower: 'We spent $1m harvesting millions of Facebook profiles' – video]

"You’ve probably heard by now that Cambridge Analytica, which is backed by the borderline-psychotic Mercer family and was formerly chaired by Steve Bannon, had a decisive role in manipulating voters on a one-by-one basis – using their own personal data to push them toward voting ...

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How your brain is wired to just say 'yes' to opioids

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


How your brain is wired to just say ‘yes’ to opioids

A Philadelphia man, who struggles with opioid addiction, in 2017. AP Photo/Matt Rourke

Courtesy of Paul R. Sanberg, University of South Florida and Samantha Portis, University of South Florida


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Mapping The Market

The tricks propagandists use to beat science

Via Jean-Luc

How propagandist beat science – they did it for the tobacco industry and now it's in favor of the energy companies:

The tricks propagandists use to beat science

The original tobacco strategy involved several lines of attack. One of these was to fund research that supported the industry and then publish only the results that fit the required narrative. “For instance, in 1954 the TIRC distributed a pamphlet entitled ‘A Scientific Perspective on the Cigarette Controversy’ to nearly 200,000 doctors, journalists, and policy-makers, in which they emphasized favorable research and questioned results supporting the contrary view,” say Weatherall and co, who call this approach biased production.

A second approach promoted independent research that happened to support ...

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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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NewsWare: Watch Today's Webinar!


We have a great guest at today's webinar!

Bill Olsen from NewsWare will be giving us a fun and lively demonstration of the advantages that real-time news provides. NewsWare is a market intelligence tool for news. In today's data driven markets, it is truly beneficial to have a tool that delivers access to the professional sources where you can obtain the facts in real time.

Join our webinar, free, it's open to all. 

Just click here at 1 pm est and join in!

[For more information on NewsWare, click here. For a list of prices: NewsWar...

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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...

Learn more About Phil >>

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About Ilene:

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.

Market Shadows >>