Note:
No blog Friday. Heading back to the States for Alumni Weekend and High School reunion.
S&P E-mini Futures:
No new high overnight, while NQs made one.
Markets:
Not Comey, not the UK elections, not the ECB (which moments ago dropped guidance on rate cuts in a step toward exiting stimulus) -- the real news is from the BoJ:
"The yen rose and Japanese bonds fell as the central bank was said to be re-calibrating its communications to acknowledge it’s thinking about how to handle a withdrawal from monetary stimulus" -- Bloomberg
This is not about success by the BoJ to conquer deflation. It's acknowledgement of failure.
As in they can't afford to keep going.
As in look out below when the markets figure it out.
Rates are moving higher around the world so far this morning.
Mood:
Taking their cues from a supermodel (Giselle) a while back, British Football players demand to be paid in Euros
Wonder if it has anything to do with weak GBP sentiment and sky-high EUR sentiment -- currently at 89% bulls.
Short EURGBP may be in order.
FX:
JPY reversed and weakened considerably after the BoJ news hit, a sign of disbelief possibly. Or a sign that the current market momentum can last for a while longer, one that I agree with.
Treasuries:
Prices red. Slight buying tails appearing, however.
10-year JGBs "sold off aggressively" on the BoJ story, never a good sign.
Energy:
WTI crude faceplanted yesterday after DoE data showed a huge build in inventories.
Guess we know not to trust API, which only a day before reported a draw.
WTI and NG both down. Maybe crude can bottom around 45.
Metals:
Gold and platinum lower. Copper and palladium higher. Silver trying to turn from neg to pos.
S&P Outlook:
Both the SPX and NDX kept the pressure on higher prices, with the NDX quickly negating the possible impulse down yesterday.
This should at least target the 2440 and 5900 areas respectively.
Hope it doesn't happen Friday when I'll be away from the screens.
Option shopping:
1) A 15-day .74 delta QQQ put asking 4.62
2) A 19-day .75 delta VIX call asking 1.55
I think I see the better deal.
Might get some for Friday, just in case, if VIX can get back under 10.
Even if there's a market rally Friday, VIX might stay where it is or even firm up.
Thursday, June 8, 2017
Wednesday, June 7, 2017
Wednesday -- Pinterest's 24X Multiple
S&P E-mini Futures:
Flat.
Markets:
Asia was mixed, and Europe mostly green ex-UK.
Lots o' monetary & political drama before the week is done.
Mood:
Still pretty frothy in Silicon Valley.
Pinterest Raises $150 Million at 2015 Share Price
The pretty photo company is now valued at $12 billion on revenues of "targeted" $500 million.
A pretty euphoric multiple.
FX:
AUD & SEK the big movers thus far, stronger and weaker respectively.
USD firming.
Treasuries:
Long end still outperforming short end. Not a good trend.
Energy:
WTI crude down, even on API figures showing a draw. NG rallying.
Metals:
Red here across the board.
S&P Outlook:
Part 1 of yesterday's scenario may have played out.
Of concern is the NDX which may be working on an impulse down, raising the odds of a trend change. But note, in the pre-market, the NQ contract has just about completed a wave-1 overlap.
Flat.
Markets:
Asia was mixed, and Europe mostly green ex-UK.
Lots o' monetary & political drama before the week is done.
Mood:
Still pretty frothy in Silicon Valley.
Pinterest Raises $150 Million at 2015 Share Price
The pretty photo company is now valued at $12 billion on revenues of "targeted" $500 million.
A pretty euphoric multiple.
FX:
AUD & SEK the big movers thus far, stronger and weaker respectively.
USD firming.
Treasuries:
Long end still outperforming short end. Not a good trend.
Energy:
WTI crude down, even on API figures showing a draw. NG rallying.
Metals:
Red here across the board.
S&P Outlook:
Part 1 of yesterday's scenario may have played out.
Of concern is the NDX which may be working on an impulse down, raising the odds of a trend change. But note, in the pre-market, the NQ contract has just about completed a wave-1 overlap.
Tuesday, June 6, 2017
Tuesday -- Super Thursday, JGBs, Lace For Men
S&P E-mini Futures:
Small, choppy breakdown from yesterday's consolidation thus far.
Markets:
Asia mixed, Europe red.
Bloomberg is touting "Super Thursday" when the ECB meeting, the UK elections (which are looking stranger and stranger for PM May), and former FBI director Comey's congressional testimony all take place.
I'd rather watch the yen and 10yr & 30yr JGBs which are acting weird along with a 1% decline in the Nikkei.
Mood:
Lace for men. Apparently it's an LA thing.
It's also the latest example just how weird things get when liquidity is out of control.
It's from Hologram City.
FX:
JPY jumping by nearly 1%.
"10yr JGBs were relatively flat with only minimal gains seen amid a cautious risk tone, while the 30yr JGB auction also failed to spur firm demand despite the b/c printing its highest in 8 months of 3.63."
Failed to spur demand . . . if it continues, it's as close to Doomsday as you can get in today's fragile world.
Treasuries:
2s &5s looking a lot shakier vs 10s & 30s lately, meaning the curve is tilting toward inversion, meaning keep your eye on the ball.
Energy:
WTI crude down slightly while NG rips.
Metals:
Copper red while the shiny stuff rips.
S&P Outlook:
Very rough plan for next few days.
Small, choppy breakdown from yesterday's consolidation thus far.
Markets:
Asia mixed, Europe red.
Bloomberg is touting "Super Thursday" when the ECB meeting, the UK elections (which are looking stranger and stranger for PM May), and former FBI director Comey's congressional testimony all take place.
I'd rather watch the yen and 10yr & 30yr JGBs which are acting weird along with a 1% decline in the Nikkei.
Mood:
Lace for men. Apparently it's an LA thing.
It's also the latest example just how weird things get when liquidity is out of control.
 |
| Who you lookin' at, tough guy |
FX:
JPY jumping by nearly 1%.
"10yr JGBs were relatively flat with only minimal gains seen amid a cautious risk tone, while the 30yr JGB auction also failed to spur firm demand despite the b/c printing its highest in 8 months of 3.63."
Failed to spur demand . . . if it continues, it's as close to Doomsday as you can get in today's fragile world.
Treasuries:
2s &5s looking a lot shakier vs 10s & 30s lately, meaning the curve is tilting toward inversion, meaning keep your eye on the ball.
Energy:
WTI crude down slightly while NG rips.
Metals:
Copper red while the shiny stuff rips.
S&P Outlook:
Very rough plan for next few days.
Monday, June 5, 2017
Monday -- Late Post
Errands, man. Step out before the bell for some greeting cards and gasoline and it's amazing how time just gets vaporized here. Gave up trying to make it back before the open and went out to breakfast at a new place I've had my eye on. Had a couple empanadas argentinas. Muy rico.
Another weak decline has been bought, yet the upside is getting weaker too. Perhaps a near-term peak is coming soon.
VIX, A/Ds, ticks, TRIN -- all lining up as price completes the subdivisions of the five-wave rally.
This is what I was thinking Friday afternoon. Still am. SPX probably much the same as well.
Another weak decline has been bought, yet the upside is getting weaker too. Perhaps a near-term peak is coming soon.
VIX, A/Ds, ticks, TRIN -- all lining up as price completes the subdivisions of the five-wave rally.
This is what I was thinking Friday afternoon. Still am. SPX probably much the same as well.
Friday, June 2, 2017
Friday -- Weak Jobs Mean More Fed?
S&P E-mini Futures:
Higher, though off best levels of new pre-market high.
Markets:
Green across Asia and Europe. Energy & metals getting slammed, but could be a buy setting up in oil.
Possibly the weak NFP has something to do with Wall Street's giddy feeling vs the reality in commodities:
138K new jobs vs 182K estimated and prior 211K.
Weak jobs mean more Fed -- the last thing we need.
Mood:
The latest tear-jerker from the press:
Puerto Rican Exodus Is Speeding the Island’s Economic Collapse
Fiscal mismanagement and corruption is speeding the collapse of the PR government while the US gets blamed.
Puerto Rico gets $6.5 billion in assistance from the US each year.
The power utility monopoly, broke. The water monopoly, broke. The pension system, broke. The highways, crumbling. The malls, filled.
"The population drop is astonishing."
The traffic is astonishing. The crowds at the mall are astonishing. The number of new restaurants is astonishing. The amount of lines for just about anything, even gasoline, is astonishing.
I've waited for an hour just to deposit a check at a bank.
Maybe the writers from Bloomberg and The New York Times could visit the island before they simply print what is handed to them by public relations firms.
Elsewhere, this story has a vague '80s feel to it:
Chinese Firm Buys 253-Year-Old French Crystal Maker Baccarat
Recall the Japanese practically bought half of NYC just before the Nikkei imploded. Will be interesting to watch how China behaves.
FX:
More USD weakness on NFP. More CHF & JPY strength for possible macro warning.
Treasuries:
Looking positive post-NFP.
Energy:
WTI crude slammed. Brent slammed. Gasoline slammed. Heating oil slammed. NG higher.
Metals:
Copper the lone ranger, lower. Shiny stuff green post-NFP.
S&P Outlook:
Yesterday had a weird feel to it. It could have been the last gasp of some "b" wave sucker play or, based on several internals which were quite strong, it could have been a small wave 3 in a rising wedge that would have bearish consequences in a couple weeks or so.
Higher, though off best levels of new pre-market high.
Markets:
Green across Asia and Europe. Energy & metals getting slammed, but could be a buy setting up in oil.
Possibly the weak NFP has something to do with Wall Street's giddy feeling vs the reality in commodities:
138K new jobs vs 182K estimated and prior 211K.
Weak jobs mean more Fed -- the last thing we need.
Mood:
The latest tear-jerker from the press:
Puerto Rican Exodus Is Speeding the Island’s Economic Collapse
Fiscal mismanagement and corruption is speeding the collapse of the PR government while the US gets blamed.
Puerto Rico gets $6.5 billion in assistance from the US each year.
The power utility monopoly, broke. The water monopoly, broke. The pension system, broke. The highways, crumbling. The malls, filled.
"The population drop is astonishing."
The traffic is astonishing. The crowds at the mall are astonishing. The number of new restaurants is astonishing. The amount of lines for just about anything, even gasoline, is astonishing.
I've waited for an hour just to deposit a check at a bank.
Maybe the writers from Bloomberg and The New York Times could visit the island before they simply print what is handed to them by public relations firms.
Elsewhere, this story has a vague '80s feel to it:
Chinese Firm Buys 253-Year-Old French Crystal Maker Baccarat
Recall the Japanese practically bought half of NYC just before the Nikkei imploded. Will be interesting to watch how China behaves.
FX:
More USD weakness on NFP. More CHF & JPY strength for possible macro warning.
Treasuries:
Looking positive post-NFP.
Energy:
WTI crude slammed. Brent slammed. Gasoline slammed. Heating oil slammed. NG higher.
Metals:
Copper the lone ranger, lower. Shiny stuff green post-NFP.
S&P Outlook:
Yesterday had a weird feel to it. It could have been the last gasp of some "b" wave sucker play or, based on several internals which were quite strong, it could have been a small wave 3 in a rising wedge that would have bearish consequences in a couple weeks or so.
Thursday, June 1, 2017
Thursday -- Uber, Airbnb, Peak Passive Investing
S&P E-mini Futures:
At upper end of choppy holding pattern overnight.
Markets:
Asia and Europe mixed to mostly green. Rates higher around the world.
Mood:
Sadly this story was presented as a good thing:
Soon more people will be driving Ubers and renting out Airbnbs than working in finance
(Ironically, I just rented an Airbnb. While viewing a listing, the site kept telling me to "go ahead and book, you won't be charged." Weird. Then when I did book, the price magically jumped 25% and, yes, my card was charged immediately.
Launched in San Francisco, but now run in Dublin, Ireland. No phone number. Just a website. Doubtful I'll be using this company much more.)
Peak Passive Investing:
An Amazon engineer is letting thousands of Twitch users play the stock market with $50,000 of his own money
Hilarious quotes and tidbits:
"After the first day, I'm a lot more bullish than I already was" about the game, the engineer says.
"Players have chosen for him 'a reasonable, diversified portfolio' that includes hot tech stocks like AMD, Tesla, and Apple."
"He's really in it for the love of the game."
"If a lot of these [stocks] start crashing tomorrow, then things could get dicey," says the engineer.
FX:
USD strength. JPY weakness.
Treasuries:
Prices heard Fed's Powell loud and clear: the Fed wants to reduce its balance sheet by half. The good thing is it's not different than what has already been reported previously.
Energy:
WTI crude and NG rallying.
Metals:
Gold, silver, and platinum down, because who needs shiny metals when the Fed might cut its balance sheet. Copper and quasi-shiny, quasi-industrial palladium higher.
S&P Outlook:
Here's the way things looked right after the bell yesterday in the NDX:
Still think there is a possible flush in store down to around 5740-5750 in "4" before a zoom to "5." Then a bigger flush.
Both NDX and SPX closed at 78.6% retracements, which raised the odds of the above scenario.
There is no reason why a more complicated pattern such as a triangle can't materialize, but all it means to me is to keep my powder dry a bit longer.
Materially below 5740, especially on a closing basis would have me looking short.
Bought QQQ 141 puts at the close, just in case. Would not want to miss a trip to 5300.
Looking for above 2418.71 in SPX. Below 2400 probably negates this idea.
At upper end of choppy holding pattern overnight.
Markets:
Asia and Europe mixed to mostly green. Rates higher around the world.
Mood:
Sadly this story was presented as a good thing:
Soon more people will be driving Ubers and renting out Airbnbs than working in finance
(Ironically, I just rented an Airbnb. While viewing a listing, the site kept telling me to "go ahead and book, you won't be charged." Weird. Then when I did book, the price magically jumped 25% and, yes, my card was charged immediately.
Launched in San Francisco, but now run in Dublin, Ireland. No phone number. Just a website. Doubtful I'll be using this company much more.)
Peak Passive Investing:
An Amazon engineer is letting thousands of Twitch users play the stock market with $50,000 of his own money
Hilarious quotes and tidbits:
"After the first day, I'm a lot more bullish than I already was" about the game, the engineer says.
"Players have chosen for him 'a reasonable, diversified portfolio' that includes hot tech stocks like AMD, Tesla, and Apple."
"He's really in it for the love of the game."
"If a lot of these [stocks] start crashing tomorrow, then things could get dicey," says the engineer.
FX:
USD strength. JPY weakness.
Treasuries:
Prices heard Fed's Powell loud and clear: the Fed wants to reduce its balance sheet by half. The good thing is it's not different than what has already been reported previously.
Energy:
WTI crude and NG rallying.
Metals:
Gold, silver, and platinum down, because who needs shiny metals when the Fed might cut its balance sheet. Copper and quasi-shiny, quasi-industrial palladium higher.
S&P Outlook:
Here's the way things looked right after the bell yesterday in the NDX:
Still think there is a possible flush in store down to around 5740-5750 in "4" before a zoom to "5." Then a bigger flush.
Both NDX and SPX closed at 78.6% retracements, which raised the odds of the above scenario.
There is no reason why a more complicated pattern such as a triangle can't materialize, but all it means to me is to keep my powder dry a bit longer.
Materially below 5740, especially on a closing basis would have me looking short.
Bought QQQ 141 puts at the close, just in case. Would not want to miss a trip to 5300.
Looking for above 2418.71 in SPX. Below 2400 probably negates this idea.
Wednesday, May 31, 2017
Wednesday -- Trump Pulls Out, USDCNH Mess, Crude Mess, NQ Plays Solo
S&P E-mini Futures:
Modestly higher, but still below recent high.
Markets:
Asia mixed once again with Europe all green. Month-end window dressing.
Mood:
Not much in mood land other than Trump pulls out of Paris.
"That's hot."
FX:
Today's big mover is the Chinese offshore yuan (CNH). Notably stronger.
Per Bloomberg, CNH jumped the most in four months as funding costs exploded amid speculation policy makers were supporting the currency in the wake of a surprise sovereign rating downgrade.
Beijing hiked the overnight lending rate sharply, intent on burning shorts. Seems to be succeeding.
Treasuries:
Three-wave structures inside of three-wave structures. Messy.
Energy:
WTI crude cratered after its three-wave rally. Interested in the 46.50 area for longs. NG down in choppy trade.
Metals:
Silver red while gold, platinum, palladium, and copper rally.
S&P Outlook:
All the action appear to be in the NQ & NDX.
NQs are currently gunning for another five-wave rally, the end of which may be a prime spot to try shorts. Maybe around the 5840-5880 area. Maybe even 6000 could line up.
Seems the S&P may be taking its cues from NDX. Dow still lags. As does Russell.
NDX does not make me bullish as it probes the ether virtually alone.
Modestly higher, but still below recent high.
Markets:
Asia mixed once again with Europe all green. Month-end window dressing.
Mood:
Not much in mood land other than Trump pulls out of Paris.
"That's hot."
FX:
Today's big mover is the Chinese offshore yuan (CNH). Notably stronger.
Per Bloomberg, CNH jumped the most in four months as funding costs exploded amid speculation policy makers were supporting the currency in the wake of a surprise sovereign rating downgrade.
Beijing hiked the overnight lending rate sharply, intent on burning shorts. Seems to be succeeding.
Treasuries:
Three-wave structures inside of three-wave structures. Messy.
Energy:
WTI crude cratered after its three-wave rally. Interested in the 46.50 area for longs. NG down in choppy trade.
Metals:
Silver red while gold, platinum, palladium, and copper rally.
S&P Outlook:
All the action appear to be in the NQ & NDX.
NQs are currently gunning for another five-wave rally, the end of which may be a prime spot to try shorts. Maybe around the 5840-5880 area. Maybe even 6000 could line up.
Seems the S&P may be taking its cues from NDX. Dow still lags. As does Russell.
NDX does not make me bullish as it probes the ether virtually alone.
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