Week is over, the optimists won, go dig a hole elsewhere

Some of you guys crack me up. Ferreting in-and-out of the tickers of garbage pail companies, clicking your hard-earned money around in some futile attempt to cure boredom? I think? It is not a money making pursuit from what I can see.

If you want to extract fiat american dollars from the global financial complex there are three ways:

1. Invest—-sit and fast and think.
2. Trade one instrument better than 99% of the competition.
3. Consistently execute the signals of an algorithm.

I pulled off a bunch of big wins these last few weeks simply by investing in the absolute best companies and CEOs in the world. I didn’t go out and try to find “the next {insert quality company here}” like all these Motley fucking fools. I let Our True Leaders do the heavy lifting. I just sat in the back seat, telling jokes and enjoying the scenery.

Square was a no brainer. I will invest in any CEO who can spend two months at a silent retreat. Noble Jack works hardt then STFU and listens to the wind. That is where all the best ideas come from.

Making money in the stock market can be so simple but some of you jokers take the most convoluted route down this gold-bricked road.

I am in far too good of a mood to sully it trading this Friday tape. I’d imagine most of the real hitters are off enjoying these final days of summer anyhow. Only lonely souls unable to find meaning in life are spending their whole day staring at computer screens on a Friday in August.

Go build something. Anything. No sense waiting for the perfect place to build. Start where ever you are now.

This is Plato’s republic.

Now I am off to work outside.

Cheers and good tidings,

Raul Santos, August 7th, 2020

NASDAQ futures are coming into Thursday with a slight gap up after an overnight session featuring elevated range and volume. Price was balanced overnight, balancing along the 11,100 level. At 8:30am jobless claims data came out better than expected and introduced some buyers to the tape. As we approach cash open, price is hovering above the Wednesday midpoint.

Also on the economic calendar today we have 4- and 8-week T-bill auctions at 11:30am.

Yesterday we printed a normal variation up. the day began with a gap up beyond range. Sellers made a small drive lower on the open, resolving the gap and pressing into the upper quadrant of Tuesday’s range before finding responsive buyers. Said buyers sent price up to a new daily high but were unable to take out the all-time high print established during Globex. That high is still in place. Buyers took price range extension up after defending the midpoint, and we spent the rest of the day chopping above the mid.

Heading into today my primary expectation is for buyers to gap and go higher, probing beyond the current high print 11,144. Look for sellers up at 11,200 and two way trade ensues.

Hypo 2 stronger buyers sustain trade above 11,200 and probe the open air, tagging 11,300.

Hypo 3 sellers press down through overnight low 11,051.25 and tag Tuesday’s naked VPOC 11,033 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

NASDAQ futures are coming into Wednesday flat after an overnight session featuring elevated range on elevated volume. Price worked higher overnight, marking a new record high before returning to unchanged. As we approach cash open, price is hovering near Tuesday’s high print.

On the economic calendar today we have ISM non manufacturing index at 10am.

Yesterday we printed a neutral extreme up. Range compressed for a second day. The day began with a gap down in range. Buyers quickly resolved the gap up with a drive up off the open. Said buyers took out the Monday high by a few point before falling down through the midpoint. This happened before initial balance was broken. Sellers steadily rotated down and erased the morning move, pushing the market range extension down. Sellers were unable to take out Monday’s low however. Instead price ramped higher into the close, eventually pressing neutral and closing on session high.

Heading into today my primary expectation is for buyers to work up through overnight high 11,144 on their way to tagging 11,200 before two way trade ensues.

Hypo 2 sellers work down through overnight low 11,055.75. Look for buyers down at 11,022.25 and two way trade to ensue.

Hypo 3 stronger sellers tag 11,000 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

NASDAQ futures are coming into Tuesday gap down after an overnight session featuring extreme range and volume. Price poked higher overnight, setting a new record high before finding sellers around the key 3:30am New York hour. The rest of the session was spent rotating lower, and as we approach cash open, price is hovering around the lower quadrant of Monday’s range. The market profile structure is textbook long liquidation, forming a lowercase letter-b shape, which suggests a temporary phenomenon where sellers squeeze out longs then struggle to press lower (See the first chart below).

On the economic calendar today we have Factory orders at 10am.

Yesterday we printed a normal variation up. The day began with a gap up beyond last wee’ks range and buying drive that probed beyond all-time highs. The rest of the session was spent essentially marking time and accepting higher prices. Participants finally took the market range extension up by a few ticks around 2:30pm and we ended the day chopping along the topside of the daily midpoint.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 11,046.75. From here we continue higher, up through overnight high 11,092. Look for sellers up at 11,137 and two way trade to ensue.

Hypo 2 stronger buyers sustain trade above 11,137 setting up a move to tag 11,200.

Hypo 3 sellers press down through the Monday low 10,971.50 and find buyers right around here before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

NASDAQ futures are coming into the first official trading day of August gap up after an overnight session featuring extreme range on elevated volume. Price worked steadily higher overnight, first taking out the Friday high during the Globex open at 6pm Sunday, then balancing up along it until about 6:20am New York. Since then price has worked higher and as we approach cash open price is hovering above the 07/21 high. Recall that 7/21 was the day sellers defended the top of their 07/13 conviction selling day and reversed the auction lower.

On the economic calendar today we have ISM manufacturing index and construction spending at 10am followed by 3- and 6-month T-bill auctions at 11:30am.

Last week also kicked off with a gap up. The whole week was spent bouncing along, above last Friday’s high before buyers eventually ended the week on a strong note. Through all this the Russell and Dow (which don’t contain big tech) lagged behind. The last week performance of each major index is shown below:

On Friday the NASDASQ printed a neutral extreme up. The day began with a gap up. Sellers drove lower off the open and made short work of closing the overnight gap. Sellers then continued lower, tagging Thursday’s naked VPOC before a strong buying rotation sent price back up to the daily midpoint. Sellers defended and made a new low, but by late afternoon a powerful ramp was setting up. Buyers eventually ramped price clean up through the entire daily range and ended at a new high of day.

Neutral extreme up.

Heading into today my primary expectation is for buyers to gap-and-go higher, probing up beyond all-time high print 11,058.50 before two way trade ensues.

Hypo 2 stronger buyers tag 11,137 before two way trade ensues.

Hypo 3 sellers work into the overnight inventory and close the gap down to 10903.50 then continue lower, through overnight low 10,876.25 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

Quick administrative note: last week I published the R.R.F. portfolio but my China correspondant and fellow R.R.F. architect ROBERTO BREGANTE was apparently not satisfied with his choices. These update have to be made Monday:

COST, WMT, AMZN, MSFT, GOOGL, BABA, OKTA, BYND, (TWLO REMOVED), BRK.B, SNE, ADBE, (AVLR, LVGO, MTCH ADDED)

Anyhow, August is hustle month. I have been going over my notes from the last few years and apparently I have a habit of launching new ventures in August. I think it is some kind of natural trigger from hearing the crickets and cicadas. Their vibrations jolt me into some kind of urgency where I remember that winter is coming, and that if I am to get a project off the ground I’d better act soon before the call of the wild lures me back into the Canadian Rockies.

Maybe this winter I won’t be granted access to the sacred northern lands of Canada in which case I will set up base camp somewhere in the Tetons and explore the back country.

In any event now is the time to put projects in motion or they won’t be materialize and before I know it we’ll have taken another lap around the sun and I’ll have a few more greys in my beard with nothing to show for it.

I want to develop land lads. I come from a long line of builders and warriors and their heritage menaces me. I either need to fuck or fight or build otherwise I become an unruly citizen, prone to over aggression and other hedonistic impulses.

Regarding the global financal complex. Things are going well for us futurists. The coined bits had a strong showing over the weekend and all last week our True Institutions of Leadership, organizations like Alphabet and Amazon and Tesla and Apple, immortal beings that systematically erase archaic notions of national borders drawn by disgusting politicians in suit and tie, our True Institutions of Leadership closed out July strong.

When the NASDAQ wins, humble Raul wins. And all models point to a continued victory for Big Tech this first week of August.

That is all I have time for today. Models are bullish into the first week of August.

Cheers and trade’em well.

Raul Santos, August 2nd, 2020

Exodus members, the 297th edition of Strategy Session is live. Go check it out.

NASDAQ futures are coming into Friday pro gap up after an overnight session featuring extreme range and volume. Price spiked upward during settlement on the winds of big tech earnings then marked time for the duration of Globex, balancing in the upper quadrant of the July 21st range (cash high day). As we approach cash open, price is hovering above the July 21st midpoint.

On the economic calendar today we have Chicago PMI at 9:45am followed by consumer sentiment at 10am.

Yesterday afternoon we heard earnings from Apple, Alphabet and Amazon. Apple is +6.5% in premarket trade. Alphabet and Amazon are -1% and +5.5% respectively.

Facebook may have reported yesterday also. They are +7.5% in premarket trade.

Yesterday we printed a double distribution trend up. The day began with a gap down in range. After a brief open two-way auction seller stepped in and worked price down through the Wednesday low by a few points. Sellers failed to rotate lower and this set up a sharp reversal. Price was range extension up before New York lunch hour and continued to campaign higher through the break. By early afternoon price was chopping and grinding higher, up beyond the week’s high prints. Then during settlement it spiked higher and erased the majority of the 07/23 conviction sellling.

Heading into today my primary expectation is for buyers to press up through overnight high 10939 and tag 11,000 before two way trade ensues.

Hypo 2 stronger buyers make a run for all-time-highs, taking out the high print11,058 on their way to tagging 11,100.

Hypo 3 sellers press into the overnight inventory and close the gap down to 10,793.50 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

NASDAQ futures are coming into Thursday gap down about -120 after an overnight session featuring extreme range and volume. Price drove lower overnight, steadily rotating downward from about 8pm New York until about 5:30am. From then onward price has stabilized. At 8:30am U.S.A. GDP data came out worse than expected. As we approach cash open price is hovering a bit below Wednesday’s low.

On the economic calendar today we have 4- and 8-week T-bill auctions at 11:30am.

Major NASDAQ components Apple, Alphabet and Amazon are all set to report earnings after the bell. Their collective results are likely to sway the NASDAQ.

Facebook reported earnings Wednesday after the bell. Shares of the social media conglomerate are -1% in pre-market trade.

Yesterday the NASDAQ printed a normal variation up. The day began with a gap up and after a brief two-way auction buyers began to campaign higher. Said buyers pressed the market range extension up earl on but failed to take out Tuesday’s high. Instead we chopped along the topside of the daily midpoint until 2pm when the Fed left their benchmark borrowing rate unchanged at 0%. Third reaction was up after the announcement and price eventually spiked higher, close the open gap left behind Monday. We fell back to the midpoint once more where buyers defended. We ended the session near the highs.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 10,675. Buyers take out overnight high 10,702 before two way trade ensues.

Hypo 2 buyers stall out ahead of 10,625 setting up a move down through overnight low 10,502. Buyers defend 10,500 and two way trade ensues.

Hypo 3 sellers gap-and-go lower, trading down to 10,425.50 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

NASDAQ futures are coming into Wednesday gap up after an overnight session featuring elevated volume on extreme range. Price was balanced overnight. Sellers managed to work price about -1.75 points below Tuesday’s cash low before discovering buyers. Failed auction down around 2am. From there price steadily campaigned higher, and as we approach cash open price is hovering above Tuesday’s midpoint.

On the economic calendar today we have the Fed meeting announcement at 2pm. CME Fed Fund Futures are pricing a 100% probability of the central bank leaving their benchmark borrowing rate unchanged at 0%. At 2:30pm we’ll hear from Fed Chairman Jerome Powell who is scheduled to give a press conference.

Major NASDAQ component Facebook, Inc is set to report earnings after the bell. The company will also be on Capitol Hill today along with Amazon and Apple dealing with politicians who want to argue the tech companies have become too powerful.

Yesterday we printed a neutral extreme down. The day began with a gap down. After an open two-way auction in range sellers probed down into the lower quadrant of Monday’s range. By 10am the auction had reversed higher and managed to go range extension up before New York lunch. Said buyers were unable however to close the overnight gap. Instead we sold off into the afternoon after failing to take out the daily high around 2pm. Sellers managed to press neutral and end the day near session low.

Neutral extreme down.

Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 10,539.75. From here sellers continue lower, taking out overnight low 10,512.25. Look for buyers down at 10,500 and two way trade to ensue. Then look for third reaction after the FOMC decision to dictate direction into the end of the session.

Hypo 2 stronger sellers close the gap down at 10,457.75 before two way trade ensues. Then look for third reaction after the FOMC decision to dictate direction into the end of the session.

Hypo 3 buyers press up through overnight high 10,617.50setting up a move to close the gap up at 10,675.50 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

NASDAQ futures are coming into the last Tuesday in July with a slight gap down after an overnight session featuring extreme range and volume. Price popped higher after the bell Monday, pressing up near the upper quadrant of last Thusday’s range. Recall that last Thursday was a conviction sell day. That Globex rally lasted until about 9:15pm New York. The rest of the session was spent steadily rotating lower. As we approach cash open, price is hovering about +30 points above Monday’s midpoint.

On the economic calendar today we have consumer confidence at 10am followed by 2- and 7-year note auctions at 1pm.

Yesterday we printed a neutral extreme up. The day began with a gap up then an open test drive up. Buyers rejected an attempt right at opening bell by sellers to reclaim last Friday’s range. This set up a drive that lasted about 30 minutes. From there sellers stepped in, first taking price back to the midpoint, then after a bit of a battle pressing range extension down. During RE down buyers were unable to close the Friday gap. Instead buyers once again rejected a move into the Friday range. This time it kicked off a steady campaign higher, eventually pressing neutral and closing at session high.

Neutral extreme up.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 10,675.50. From here we continue higher, tagging 10,700 before two way trade ensues.

Hypo 2 stronger buyers sustain trade above 10,707.25 setting up a run up through overnight high 10,758.50. Look for sellers up at 10,795.75 and two way trade to ensue.

Hypo 3 sellers drive down through overnight low 10,601 off the open, setting up a tag of 10,546 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves: