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
23,376 Blog Posts

Chasers Are Getting Killed; And So Are the Bears

The big story today is short sellers got poleaxed at the open in unrelenting buying. We had names +15% on no news, fucking the long-short hedge fund managers into early coffins.

Now the chasers are being beaten across their faces, as the $SPY ebbs into the red.

So what is the play?

My suspicion is this is a trap. We have markets diving lower and the water is once again inviting for the bears. However, bear in mind several things here.

1. the dollar is 1.02% v the euro. It was down more, but still down as we price in rate cuts.
2. Gold, silver, oil and copper are all sharply higher because of the dollar.
3. Massive gamma squeeze took place due to heavy short positions amongst the first class citizenry in asset management.
4. The Russell is still +2.3%

How am I responding?

I was long but in defensive stocks at the open and had to cull them early. My gains ranged from +0.8% to 1.3%. When markets broke lower I hedged and then began to sell off my longs as we ticked lower. When hedged, each time I sell a long increases my short exposure, obv.

About an hour ago I went NET SHORT at 25% of holdings, $UVIX, $TZA, $FNGD. $LABD — but now I closed them all out for handsome gains (+2.1%, +0.8%, +2.4%, +1.5%) leaving me with longs and 60% cash.

BOTTOM LINE: the thrashing back and forth is due to an ideological battle taking place with chasers against non-chasers. Ultimately, the chasers always win and if forced to bet here — I’d bet on 10 green candles into the close followed up with a +100 NASDAQ tomorrows to insert the final dagger into the heart’s of the bears for 2023.

+63bps in highly professional trading.

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A Great Short Squeeze is Underway

Stocks are OFF THE HIGHS now — but just a short while ago heavily shorted stocks were +5.5% for the session, high beta up in kind. The only way to describe the pin action is “incredible” but not unique. This is what happens when the bears lose their shirt and the ram is pressed against the wall.

You’d be wise to avoid thinking the market will reverse lower and collapse here. There is weakness in risk averse stocks — which stymied my trading gains this morning. Even still, I am +80bps for the session, down from +120bps. I got a little overzealous this morning and chased some things and ended up taking some Ls. These things happen.

My longer term strategic was +3%, now +1.8%.

Is it over?

I don’t think so. However, I am 90% cash in my trading here — only because of the time of day coupled with the idea that perhaps, just maybe, we might see a downside reversal. I am not suggesting it will happen, but merely open to the idea.

The thing about rallies such as this: you needed to be in yesterday before the close to bank the coin. You can possible scalp a little here and a little there — but if you missed out and find yourself chasing stocks already +15% for the day — YOU PLACE YOURSELF AT GRAVE RISK in the event of a reversal.

It’s important we all understand our places in the big scheme of things. Not all of us are destined for greatness. Some of you will never be great and have been designed to plod along merrily in ignorance. This is not my journey, as I am burdened with the task of greatness and battle each and every day to escape the pangs of mediocrity.

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LET ME EXPLAIN SOMETHING TO YOU PAL

Let me explain something to you pal. I will choose my words very carefully here as if not to be unclear about what I am trying to convey.

I stand before you a very intelligent man, perhaps the best trader ever, accustomed for winning over decades of toil and tumult. I’ve grown used to winning and expect to see the Ws line up aside my name, no matter the case.

Up nearly 400bps in my strategic and +244bps in trading for the session.

I have undergone a transformational event since 2020, following the creation of Stocklabs — which has increased my annual returns by a factor of 5. I don’t tell you this because I want to sell memberships — but because it’s a fact.

BEHOLD as the grandiosity of the market lays waste to the last remnants of the bears — ripping their heads off and skinning them for their fur. The colder climes are here and with it is my indifference to your stubbornness, missing out on what is the best run since 2021.

We do not trade with our emotions and succumb to our feeeeelings. I couldn’t give a fuck about my own feelings; imagine how I feel about yours. We trade with our heads and our balls, swinging hard and low into the tape — methodically and also with purpose to increase the wealth of our estates for the future.

The reasons for today’s +200 NASDAQ meltup are in fact IMMATERIAL. We do not care why stocks were up, at some point, we merely observe and react. If you’re not prepared to react and do what is the right thing to do for yourselves and your loved one’s — you should cease playing in the sand box of men — take your money and stick it in the wall.

As for me, I closed fully long and leveraged in fact at 118% of equity — interested in MOAR — in spite of the fact that I retire into a glass of Bordeaux at recourd highs.

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FED VICTORY LAP CAUSES MARKETS TO RAGE HIGHER

The Fed came out and talked some shit, causing stocks to giga-spike to the upside.

Here were the main takeaways

December: “Recent indicators suggest that growth of economic activity has slowed from its strong pace in Q3…Inflation has eased over the past year but remains elevated.

U.S. FED RATE FUTURES RAISE ODDS OF MARCH 2024 RATE CUT TO MORE THAN 60%

The Fed holds its benchmark interest rate in the 5.25%-5.5% target range for a third meeting.

What does it all mean? It means the Fed is comfortable with the trajectory of inflation and is becoming more concerned with growth, suggestive of a series of rate cuts to come in 2024. The market is rallying because monkeys like to eat bananas. In fact, markets tend to DROP when the Fed lowers rates and rise when they go up, all to do with the general condition of the economy.

I happened to be LEVERAGED LONG at 115% before the statements and now possess gains of +110bps in trading, +131bps in my longer term strategic account.

To answer questions posed to me: Yes, all basic members of Stocklabs get access to all of my portfolios.

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Biotechs Might Bust Loose in 2024

Historically, the biotechs are one of the best places to blow up your account. It’s also a place where speculation runs rampant in what I like to dub “black box trading.” This is especially important during economies in transition, when people want to invest in themes without having to face the realities of earnings and revenues. During bubbles biotechs perform best and we’re all captivated by the science and the Baker Brothers’ holdings sheets. But over the past 2 years, this industry has been an anathema, partly due to restrictive financing due to higher rates and more importantly the public’s disgust with the scientific community post COVID vaccine flop.

At any rate, this is an industry down 50% over the past two years, with large losses in both the big biotechs and the small.

I don’t have any specific catalyst as to why this industry might be poised to bust loose in 2024, other than two salient points.

1. Rates have probably peaked, creating a more accommodative environment for raising capital.
2. Over-fucking-sold.

Some of my favorite beaten down names include ILMN, EW, CRSP and perhaps even the bastards at $PFE down by half. There are dozens of biotechs down more than 50% the past 2 years and I’d be lying if I sat here and told you I had any idea what the fuck most of those companies did. I have learned experience in seeing this sector go through dramatic peaks and troughs throughout my investment career and very rarely do they stay down for years at a clip.

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Never Short a Boring Market

On one hand I sort of feel as if the gains for the year have been had, and enjoyed. On the other, I want more. I am cognizant of the fact that my desires don’t necessarily gibe with the future outcomes — but the trends has been higher and all bids are being bought.

In the past week or so the breadth has narrowed, making it difficult to trade indiscriminately. The small caps have lagged and the truly degenerate stocks have been dismantled. This is the reason why I’m -1.4% for December. I’m not too worried about my performance, since the month is young and I feel good about my handle on this particular tape.

I closed the session down 14bps, heavily leveraged long without hedges at 115% of equity. I have soured on basic materials and now favor healthcare, risk averse, and select tech names. I do like certain retail oriented names, such as SBH and GOOS. We are of course in the middle of the Christmas shopping season and things appear to be doing just fine, unfortunately.

The tape is slow and methodical and many people are choosing to trade less — in preparation of the holiday down time. The year has been good — but not easy. I look forward to tackling the puzzle of the market in 2024 and beyond but before I do, damn it, I want to make another 5% from here.

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Bitcoin FUD is Retarded

Hello Sirs —

I’d like to take a moment out from your day to remind you that — if you’re not participating in the dissolution of the central banks by way of investing into $BTC and other high brow cryptos — you are in fact retarded.

The arguments against crypto are always the same, predictable fear, uncertainly, and doubt — stemming from “it’s fake” to “it’s a trap.” There is no need to overthink this, as there is no need to overthink the condition of the ever rising stock market. The fact that people bid up $BTC makes it true. The idea that it’s all a scam is rooted in paranoia. The fiat currency racket is a scam. The gold mine FOOLS are scam artists, pretending the value of their raw metal will save them from the pangs of central bank collapse, when in fact central banks more or less control the price of gold.

It’s true, gold has been a fine denizen to store wealth — but it’s not transformational and isn’t accessible to all and it certainly cannot be used easily to buy and sell things.

Take heart in knowing that when $BTC drops in value — it’s merely a way station onto greater and bigger things. HOWEVER, I do not have an expectation with regards to price targets or when in fact the price will truly soar. I just know that it will, eventually. It might happen post nuclear detonation or dissolution of the ECB or perhaps it’ll take another bout of rapid inflation coupled with bank failures. But one thing I am certain about is this: people will, one day, seek refuge away from fiat and when they do $BTC and other quality cryptos will be a place to preserve value. At that point, there will be a frenzy to get in, globally, so it makes sense to buy some every month now, as if paying a bill, for a just in case scenario.

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Bad Breadth Tape

Call it a wrap for 2023. We are now trading listlessly, suggestive of market exhaustion. We have every reason to jimmy higher based on the fact Joe Biden defeated the inflation monster — yet, incredulously, we’re only up a little. It’s worth nothing the small caps are sharply lower — but who cares about them?

Overall, market breadth is once again in the shitter — at 40%. We haven’t been over 70% since 12/1. But we shouldn’t be surprised. This is part and parcel of trading during the month of December, largely a piece of shit month low lighted by PAGAN XMAS where men head out there and buy all manners of shit for their children and wives — load up on credit card debt and/or deplete some of their cash reserves — for a holiday that was never meant to be.

Once upon a time Christmas was to celebrate the birth of the son of God. Nowadays we celebrate a fat home invader squeezing through your chimney to eat your cookies and to drink your milk.

I am down 20bps today. My ‘revenge trade’, thus far, flopped — but I haven’t given up on the idea just yet. As my readers know, “The Fly” is a virtuous man with many talents and is deserving of stocked market wins. At times it will appear that I have lost the narrative, drowning in the volume of my own trades and/or hubris. But rest assured, I’ll come right back to preside over all in time as Chieftain of the Market — scalping heads, merrily, along the way.

More later.

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REVENGE LOOMS

I was lost in the forest of the market today, stemming from my disinterest. I’ve taken up a new avocation — learning to code. By my math, it will take me the next 13 years of my life, spending roughly two hours per day every day, in order to get good. I will of course learn fast and believe I am good way before I am actually good. But to be actually good at anything, roughly 10,000 hours is required.

I shed 128bps today and I took the position of cold hearted revenge heading into tomorrow. I am LEVERAGED LONG 123% in some of the finest stocks with the intent to skin alive those who chose to bet against me. I realize no one actually bet against me and these are merely figments of my imagination. However, I find it impossible to do anything without steaming directly ahead into an enemy camp.

For the month, I am roughly flat, which is disgraceful juxtaposed against the NADAQ’s +1.7% showing. I find solace in the fact that my Strategic Holdings account is +5% for December and also know that very soon my revenge will be serve extra cold and without mercy.

This sort of jargon really helps motivate me to thrust ahead, especially since it’s all so mundane and pointless — me out here “trading away” in a digital hellscape with the sole purpose of increasing my digital dollars so that one day I can drop dead and leave it all to my children who’ll spend it post haste on stupid things trips, homes, clothes — all of the things I deprived myself of in this life in exchange for toil and self imposed hardships.

GOOD DAY.

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The Tape is Still Bullish

I saw Napoleon over the weekend — what an uninspired piece of shit production. Everything was bad — from the set to the acting to the moronic and anti-historical storyline. It seems to me, movies have gotten progressively worse since COVID. It’s almost as if these writer and actors are now, somehow, oddly impaired — producing shit tier films. I’ve also marveled at how CGI has gotten worse over the years, something that doesn’t make any sense but presents itself all the time in modern cinema. It just goes to show you how unserious a people we are.

I have taken the day off until now — by by 105bps. The market is good, led higher and stronger by retail, basic materials and a very strong big in the semis. $AVGO has finally achieved the $1,000 roll, which of course was inevitable. I had bet my eternal soul for nothing in return it would happen and voila — here I am right but without any gains to show for it since I was not long.

I was long $SE into today and got bagged due to Tik Tok buying their chief competitor. Today is not a runaway melt up sort of day. With cryptos lower, we have a mix, a rotation even, out of the more degenerate names and back into the lesser degenerate names.

I will attempt a foray at regaining some losses into the final hour — but more importantly set up for the morrow.

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