Fed Decision Looms: FEARLESS MARKET

What happened to the fear of net neutrality, Y2k or the idea of the Fed even changing its language to suggest that MAYBE just MAYBE they might taper bond purchases?

Since 2008 it was an unthinkable option for the Fed to hike 100bps in a single meeting. Such an egregious act of war upon the markets would be met with 10,000 Dow points down. It would mean the end of the world. But here we are CLAMORING for 100bps because “OMG INFLATION IS SOOOO SCARY” — but nothing has changed. Oil is less than $100 and gas prices have been at or around these levels since 2007. The fear mongering has abated and so the slave cattle are now agreeing with the prevailing wisdom — which is to HIKE RATES sky fucking high in order to SAVE the economy. That’s right, we are SAVING the economy by slowing it down.

Tomorrow the official GDP numbers come out and Barclay’s is looking for a contraction of 0.6%. They are now calling it a “technical recession” on Bloomberg — because you know — it’s not a REAL fucking recession — two consecutive quarters of GDP declines — because this one is being sponsored by Vlad Putin.

It’s very hard to separate market bias from the idiots who control policy. You see and hear these people and just want to sell it short. But then you realize — it’s all bullish and a casino for rich people to rig numbers in their favor.

We embark on the Fed decision inside the hour and it’s likely we will rise — because markets seem to only want higher prices after Fed meetings.

Both GOOGL and MSFT posted better than expected results, causing tech stocks to rally today. We had 3 down days following a 10% lift. Leaning into that short, in hindsight, was a mistake and now the chophouse is open and in session.

Today’s gains are concentrated in tech, which was poleaxed yesterday. This is the perfect tape for permanent bulls to just sit back and buy. There was a pullback and now we’re spring boarding higher again.

I got caught in SQQQ and a series of old man stocks which are getting hit too. I closed out the short and a few others and will now hold and wait to see if markets weaken throughout the day.

Down 120bps early going, not chasing tech here either.

The NASDAQ shed 220 points today, reaffirming a downtrend that seemed lost just a week ago.The NASDAQ gains for July are now HALVED, +5% down from 10% and the reason for that is simple.

The idea of a soft landing and/or “mild recession” is fast becoming a fairy tale — buttressed by the weak numbers out of WMT and job cuts at SHOP. This reality has caused Wall Street to price in risk again, revoking the recent gains in consumer oriented stocks. The risk to buying this dip is this simple fact: this time is different.

This leg lower is based on fundamental news, which warrants a tangible reassessment of earnings. Things needs to be priced for recession and we are nowhere close to that at these ELEVATED levels.

Technically speaking, we should bounce soon. I just couldn’t get myself to commit to the technicals when the fundamentals were staring at me demanding that I be cautious.

As such, I closed +75bps, DOWN from a session high of +1.5% — heavily hedged and long a pastiche of energy and monkey pox plays — because why the fuck not.

I snapped this midday, a telling tale of post modernism Americana.

Todays working themes sums up America pic.twitter.com/tD4nbMCkBX

— Stocklabs (@stocklabsapp) July 26, 2022

This is the perfect way to end the world, via wanton degeneracy via MONKEYPOX begotten by sodomites.

Without going into the details of the news, which is nonsense anyway, it’s important to note the market is viewing this as an issue — as Monkeypox stocks are bid higher in a DOWN 200 NASDAQ day.

I am long CODX, INO and I traded out of VRAX for a 4% gain. There are others, such as CMRX, SIGA, TNXP and GOVX — but I am playing these because they’re not up 50% and it is my belief the plebs will get around to sopping up secondary names.

Pox aside, we have a DOWNWARD pressured market with little to nothing of note. I am long LNG plays, hedged by short NASDAQ, Bitcoin and the banks — +130bps for the session so far.

Let’s take that SNAP miss from last week and how that effects online advertising and also view these SHOP and WMT disasters for what they truly are and conclude THE CONSUMER IS DEAD,

On top of that, European banking is dead too, as shares of UBS descend into the pits of hell.

If what I’m saying is true, the recent rally predicated upon the notion of “MUHHHHH THINGS ARENT SO BAD” needs to be completely revoked and stocks back down to annual lows.

I came into today heavily long natty and short stocks, and I’m up 0.7%. I’m now only long CODX (MONKEYPOX), BG (AG), and SQQQ (FUCK THE NASDAQ).

I’d be shocked if we weren’t pinned to lows by the end of the day.

More good news, European gas Futs are back to the March highs, after Russian cut the gas to Germany yesterday and haven’t turned it back on.

But more importantly for the narrative of global recession, Canadian piece of shit Shopify fired 10% of its workforce with immediate effect, because business is slow and they’re not selling that many baseball’d hats anymore.

Shares are through the floor, off by 15.5%.

It appears, at least for the time being, the early Ukraine war trade is back, with commodities running hot and everything else in shambles.

It’ll most likely be destroyed tomorrow. If you were long tech, you lost money today. You did little unless concentrated in commodity plays, which is nice but also a recipe for disaster.

I closed about flat for the session, after taking the morning off — but got lucky with my quant +4.34%. If commodities pull back tomorrow, that account will be down 3-4%. That’s just how the volatility works now.

There are rare occasions where people are able to meander and slither their way from one trade focus to the next. I will tell you, however, that the vast majority of people are unable to move from oils to tech in a seamless fashion and time it correctly every single time.

The best course of action for people out there is to either take a balanced approach to the market, 10% weightings in all sectors, or simply trade very small and keep more than 30% cash at all times.

The likelihood that we’ve seen the bottom is remote. The fact that you are expecting grandiose returns in a market that is temporarily dislodged from reality is a mistake. Trading with trends is correct. However fun it might be, at some point the trend will point towards the fundamentals again and last I checked that isn’t looking too hot.

In my opinion, I’d prefer a counter-correlation approach to the market here, in favor of slaving to the indices. There will be a day, some time soon, when markets will fucking plunge into the sand and all of your bear market bounce gains will be washed away. You will hold, or even double down into leverage, because nothing says “I have a small dick” like doubling down on a bad trade — and then you’ll descend back into anarchy with 30% losses. You do remember those losses just a month or two ago, yes?

Bottom line: It’s not a race and you don’t have to make 4% per day — only retards aim for returns like that. If by the end of the year you’re up 25% — you could consider yourself to be in the up 1% of investors on the planet.

I haven’t seen material news today. Perhaps the market is finally getting around to positioning for the fall and winter; but it’s clear as day now that investors are pricing in the inevitable freezing of the sausages in Berlin this winter. We are seeing natural gas spike to session highs, +3.8%, oil is bid higher, tankers who transport natty bid higher, and basically all key players in the production and transport of LNG to Europe also bid higher.

I view this trade as obvious and because it is obvious it is also risky, filled with fresh money traders who will bail on it with any news that might be viewed as bullish for a warm German Christmas.

HOWEVER, I think it’s worth taking, nonetheless — especially now with August looming and the commodity sector back in play. If you’re going to allocate into energy, say 10-15% of your portfolio, you might as well focus on this aspect of the trade.

Another curious lift today is in potash plays like MOS and IPI. Early on during the war, sky was the limit for these names and then, out of nowhere, they got dismembered and then destroyed. Regardless of whether or not Germans will also starve this winter, MOS is trading super fucking cheap and is a buy, alongside other fertilizer plays like IPI and CF.

Into the close, I might not hedge, but I will have lots of cash in reserve.

I took half the day off, not because I had to or even wanted to — but because I could. One of the perks of being a little known niche blogger in a small corner of the world is that I can take a day off and if you’re not looking close enough — you won’t even notice it.

I spent the past hour trying to find reasons to sell short the market and I could not, so I went long. Since I fleshed out of my holdings in the AM, I did not participate in the big run up in many commodity names in my trading — but did fully in my Quant. The quant, SIR, is +3.5% for the session, whilst my vacationing monkeybrain is +0.12%.

Never fear, I have innate gifts to really trade well during certain non-descript streaks, which could neither be explained or forecasted. They just happen and after they do — I am up a bunch of money.

Into the final hours I trade, I suspect strength in the Dow, oils, natty, and the banks. I especially like the regionals. The best performing ETF for July is NAIL — 3x homies. What does that tell us?

If you insist on being short, maybe go with an SQQQ hedge against trending sectors. There is more strength in the smalls, so TZA might not be ideal.

More later.

Firstly let me explain to you why you should pay attention to this post and me boasting about how great I am.

I was in professional money management for 18 years and was always the best investor of any of my peers. I have been investing, first on paper and then real, since I was 10. I had always wanted to be a stockbroker and take my crafty extremely seriously. I, I, I, I. You get the gist. The fact of the matter is, if you are reading this post — odds are I am a much better investor/trader than you. You might be able to ski better, ride on a bicycle faster, or even best me at a game of tennis — but I can out-trade you you cunts so pay attention and your lives might improve via my guidance.

I have 3 accounts that I share inside Stocklabs. Every trade is logged and tracked for pnl in a public portfolio. They are 100% transparent. Within those portfolios I have 3 focuses:

1: Day/swing trading: This is my main portfolio, the one with the most invested and it is primarily used for day and swing trading. Although I have lessened the degree of Intra day trades in 2022, it was a frantic account since 2020 — at times registering 100 trades per day. My style has shifted dramatically in 2022, leaning more on end of day positioning with hedges and opening tick harvesting. My risk is mostly mitigated by holding time. You can’t lose if you’re not exposed. That account is +46% for the year. All trades are inspired by or by using the tools inside Stocklabs. Trades rarely make up more than 5% of the overall account and losses are cut short very fast, max drawdown in the range of 5-7%.

2. Quantitative trading: I set filters on my screens for fundamentals and technicals and position once per month. Each position is equal weighted at 5%. This account had been +20% for 2022, but got clobbered last month and is now down 2.6%

3. Algorithmic mean reversion trading: This is an account that only trades when Stocklabs flags oversold. Upon the first signal, I allocate 33% of my account into TQQQ. If another OS hits inside max holding time of 5 trading days, I add another tranche until fully invested. Each purchase resets the holding time and I sell hook or crook after 5 days. That account is +15.55% for 2022.

Net value of these accounts are $925k. I started all of these accounts inside Stocklabs in late 2020 at $250k.

That’s who I am pal, and you’re nothing.