iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
20,691 Blog Posts

Stubborn Market Doesn’t Want to Trade Lower

Rule #1 in the short sellers handbook says “Ye shall not short boring stocks that do not go down, especially when they should.”

If something doesn’t seem right, that’s because it isn’t. Had you listened to the advice in rule #1 in the short sellers handbook — you would’ve saved yourself a small fortune over the past 2 months. Sure, stocks “should’ve” traded lower — but they didn’t. Here we are in a boring Friday, post massive melt up, and the Dow is off by 120. But the VIX is flat, in spite of oil down 5% and the smallest of the smallest of caps are still catching bids. Dare I say this market does not want to trade lower?

I really want it too, especially since I have a 15% position in SOXS. Today is a Friday we all know markets do not bottom on Fridays — but the morning move has concluded and if we’re going to trade lower — it won’t happen now. If it does, it will trade lower after 3pm.

Ergo, time to cover said shorts and look for some reversal to the upside trades. What else is new?

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25 comments

  1. trumpmeister

    Bought more stocks this morning on the dip. Thanks for the cheaper price. Going higher from here later.

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  2. zaporozhets

    I’m a little bearish here:
    Large caps that have been leading indexes higher look overbought on the daily charts and could correct modestly (example AMZN),
    US coronavirus cases spiked higher to 28K yesterday amid states re-opening,
    China/HK–implementation of new security laws could reignite U.S.-China trade tensions,
    S&P futures touched upper resistance, could test middle Bollinger at 2884,
    Businesses re-opening at reduced capacity, but will they reach even that limited upper bound with many people still nervous to go out or not having any income?
    In short, good news built in but risk is prices correct lower…

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    • moneybagz

      This is a wonderful example of media conditioning. Literally your post reads like an amalgamation of DJ news wire Pravda. You’re a lemming, a sheep, a minnow. See pal even ‘Le Fly’ falls for it, sashaying in and out of triple inverse ETNs, liquidating entire retirement accounts on headlines of the Black Death killing millions only to realize the entire modeling of the Black Death was based on a stochastic whose code was even far simpler than exodus’s.

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      • tjnyt

        Couldn’t have said any better.

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      • peaches

        when ur done arguing with strawmen… teach us about the “stochastic code” used to model the BLACK DEATH

        please!

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      • numbersgame

        The pandemic, economy and stock market are related, but they ar not the same thing.

        As for “the models”, the prediction for millions of deatsh is still valid for the conditions that predictionwas made under: no changes in social distancing. It’s pretty simple:

        Death rate * popualtion size = number of deaths.

        A 0.3% death rate will get us to 1 Miilions deaths, and the actual death rate is at least 3 times that – including those that show no symptoms (it is 4-5% if you just look at confirmed infections).

        What some people don’t get is that you can’t flip a swithc to turn the economy back on. They also forget that our “great” pre-covid economy was sustained by record-low interst rates. COVID-19 was the trigger, not the cause of the problems. Like JPow said on Sunday, we shoudl ahve been able to run a budget surplus and let rates rise in 2018-19 if the economy was strong.

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        • peaches

          “Like JPow said on Sunday, we shoudl ahve been able to run a budget surplus and let rates rise in 2018-19 if the economy was strong.”

          Moscow Mitch and Paul “I hate skilled labor” Ryan had to pull off a massive transfer of wealth to the nobility that doesn’t work for their money… that is what these whores were hired for. Paul Ryan retired like 5 minutes after the bill was passed. What sort of representative of the people retires after spending a trillions of dollars and channeling 80% to a class of humans who add ZERO productivity to the economy?

          We needed to lower corporate tax rates because the largest economy the world had ever seen was… um… humming along perfectly. Corporate executives literally told us they were going to spend the money inflating the market with buybacks and/or sending direct cash injections to the feudal lords (no not you guys)

          Republicans donkey punched the economy. It was supposed to be awesome I dunno what happened?!?

          No big deal. As long as you sold your stocks before March you got your nut off. Frat boys don’t go to jail.

          Perverts… like the guy mocking Jesus in his avatar.

          These are the same clowns that insist “this is a christian nation”

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          • peaches

            finance is to economics like the culinary arts are to nutrition.

            the population is devouring burgers with glazed donuts and using the argument that “yummy food can’t be bad for me”

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        • peaches

          Also Numbers,

          USD makes up over 50% of the currency out there. I’d bet its way higher but I don’t want to exaggerate.

          Everything else shares the rest of the space.

          Everyone else will have MORE economic trouble out there than we do.

          Everyone else will therefore run up balance sheets as well

          so, um, wonk wonk,

          If we convert all other currencies into dollar amount… then we can imagine…

          if the BOE buys one billion USD in pound denominated assets, aka “prints one billion USD worth of pounds”

          This debases their currency MUCH more than a same sized amount in real dollar Fed activity

          Now, the American economy is *not* +50% of the global economy right?

          and the entire commodity structure (besides gold? pikers: zoom-out-of-your-oil-charts-please)

          … is a pile of resources under the ground, rotting in fields, no longer producing DOLLARS… and the mines/fields are owned by heavily indebted agricultural and commodity extracting companies.

          Powell knows all of this. Too much USD printing will put rates negative. As long as we don’t print at the same scale as the rest of the central banks everything is gucci. Everyone around the world will see faster M2 growth in their respective currencies and they will buy US Bonds and equities. Counterparty risk with US treasuries does not exist, because nuclear submarines. Counterparty risk with US stocks… well, something tells me the guys making 70% on oil stocks are not investing long term.

          *I’m holding TMF. bonds and gold are in an uptrend that is supported by economics. stocks… are in a bear market. the poor and uneducated are dumping their life savings in stocks because of an over simplified understanding of “buy low and sell high”

          like an 80 year old who thinks his new 40 year old mistress has a “tight” snatch.

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      • numbersgame

        The pandemic, economy and stock market are related, but they ar not the same thing.

        As for “the models”, the prediction for millions of deatsh is still valid for the conditions that predictionwas made under: no changes in social distancing. It’s pretty simple:

        Death rate * popualtion size = number of deaths.

        A 0.3% death rate will get us to 1 Miilions deaths, and the actual death rate is at least 3 times that – including those that show no symptoms (it is 4-5% if you just look at confirmed infections).

        What some people don’t get is that you can’t flip a swithc to turn the economy back on. They also forget that our “great” pre-covid economy was sustained by record-low interst rates. COVID-19 was the trigger, not the cause of the problems. Like JPow said on Sunday, we shoudl ahve been able to run a budget surplus and let rates rise in 2018-19 if the economy was strong.

        Now even doctors aren’t necessariyl good at basic math, and peopel tend to beleive what they want, especailyl when nothin is 100% ceratin. So plenty of jackasses still beielve this is “just the flu.”

        And in terms of conditioning, it is very hard to beat: “buy the dip, the market always recovers,” so that is waht is driving the stock market, not any grasp of the long-term econmoic consequecnes of the pandemic and the years of loading up on debt prior to that.

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  3. roguewave

    Just heard a stat. I think it was for 15 and under.

    ‘demic to date, how many kids have died from Covid in the entire US?

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    • numbersgame

      Under 15 age, under 15 deaths is my guess.

      The more imprtant question: why? Figure that out, and you have a cure.

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    • roguewave

      And the answer: 5

      Yes, they have closed all of the kindergartens and grade schools for less than 1 in 1 million chance of dying.

      Fauci knows this.
      From day 1 there has been fuckery afoot.

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      • numbersgame

        That is NOT why they closed the schools.

        They clsoed the schools because
        1) The virus is highly contagious, and you can get it even from asymptomatic people. We’ve known that since **Janaury**.
        2) If you have a lot of peopel( ie, kids) in very crowded building contanst intermingling, that is an ideal way to spread a virus.

        You can almost gurantee that 50-70% of the kids in school will get it, and pass it on to their whole household. The schools are closed to protect the ADULTS, not to protect the kids.

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      • numbersgame

        To be clear, I’m not *defending* the school shutdonw, i’m just explainign it. Many of the parenst are under 40, and almsot all are in their under 50, so not in a huge danger themselves.

        However, if you look at the demographics of the governemetnla leadership in the US, and if you look at the dmeographics of those that lost their job, you can see why the US decided on a total shutdown.

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      • Mr. Cain Thaler
        Mr. Cain Thaler

        We didn’t close schools because we were eorried about the mortality rate of 8 year olds.

        We closed schools because children are fucking disgusting and elementary schools in particular are like a Silk Road but for disease. We didn’t want it getting home to grandma/grandpa.

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  4. trumpmeister

    It’s funny that there are a lot of bear shitters who try to play doctor and rationalize their bearish perspectives. I’m probably the only real MD here and I am buying stocks continuously.

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    • moneybagz

      How’s business been?

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      • trumpmeister

        Elective procedures are down and admins are asking docs to take pay cut.

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        • peaches

          hmm. paycuts. sounds bearish.

          you do get paid in MONEY right?

          nevermind, i forgot doctors can live off their dividends

          https://www.comptia.org/certifications/security

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          • trumpmeister

            There is a diff bet asking and demanding a pay cut. Haven’t been approached for this yet. If I do, I would fold up my beds, tell Big Brotha to gfto, and chill at home.

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          • peaches

            40 million unemployed and people in your place of work are talking about “asking” for paycuts.

            *not bearish*

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    • the_wolf

      Not the only one,……
      I’ve been buying energy since March
      Up 70% And uuuuuge in size

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