Dark arts descend upon the super american football match up

Canned water dealer Liquid Death hired a real-life witch to cast a hex on the Rams during tonight’s Super Bowl match up.

How far have we strayed from the god of christian lore? Throughout the sports game a witch will be cursing those holy Rams and their Matthew Stafford, summoning the powers of bealzibub in the name of profit and marketing.

Contrary to the bets of football gamblooors, my fate rests in the hands of algorithms cobbled together by a ragtag group of online misfits. Said algos have me leaning bullish into a super intense week. When fortuna’s wheel spins, I prefer to have my footing on solid ground — not superstitions. I’d rather base my gambles on whale migrations that god or the devil.

Moving on…

Some attention-hungry DC journalists starting tweeting out some real greasy INVASION tweets Friday afternoon, spooking the already spooked markets more than they already were.

NEWS: The U.S. believes Putin has decided to invade Ukraine and communicated those plans to the Russian military, three officials tell @nickschifrin. Two admin officials say they expect the invasion to begin next week—echoing what Secretary of State Blinken has said.

— Geoff Bennett (@GeoffRBennett) February 11, 2022

Tensions are running high economically and geopolitically — one in the same.

The last thing we need is a battle. What this world needs right now is calmer, darker minds to prevail. The Rasputins of the world. Folks who drink reindeer piss and wander around talking to trees.

If these power-hungry meat-hounds keep up this cock-measuring contest. We’ll all be fucked. Living underground, fighting off radiation wolves and eating Raul’s pumpkins.

I intend to take the week slowly.

There are hot trader accounts on twitter who swear by actively trading these highly volatile markets. I tend to step aside and let them mash each-other’s books. Then, once the storm recedes, I sort of drift back in and pick up the pieces.

The nice thing is I still don’t have my tools. So I don’t feel pressured to take action.

I made an error last week. Shooting from the hip in the NASDAQ futures market. It worked out and I captured two stacks of fiat american dollars. That is trouble. I SHOULD not and WILL not trade like that again.

I suppose I am cautiously bullish with an eye on capital preservation?

Okay for now.

Raul Santos, February 13th, 2022

And now the 3745th edition of Strategy Session. You know it’s getting dodgy when the Marcus Aurelius quotes come out.

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Stocklabs Strategy Session: 02/14/22 – 02/18/22

I. Executive Summary

Raul’s bias score 2.73, neutral. No clear bias. Perhaps a rally early in the week. Then look for the reaction Thursday morning (after Nvidia and Walmart earnings) to dictate direction into the weekend (long holiday weekend, markets are closed next Monday in observation of President’s Day).

II. RECAP OF THE ACTION

Choppy through Tuesday. Rally Wednesday. Reversed lower Thursday and hard selling through Friday and into the weekend.

The last week performance of each major index is shown below:

Rotational Report:

Key Tech and Discretionary under pressure. Energy continues to trade independent of the equity complex. Financials flat as investors eye rate hikes.

slightly bearish

For the week, the performance of each sector can be seen below:

Concentrated Money Flows:

The selling skews over the last thirteen weeks have been dominated by sellers. Last week buyers skewed the ledger but these aren’t really the type of industries that drive the market.

slightly bearish

Here are this week’s results:

III. Stocklabs ACADEMY

Geopolitical risk elevated

We operate independent of news as much as possible. But one cannot simply ignore invasion headlines like the ones put out by DC journalists last week. We have an overbought cycle (bullish statistics) through end-of-day Tuesday. That is the only systematic signal we’re working with heading into the week. I am inclined to lean on that stat as long as Russia does not invade Ukraine.

Note: The next two sections are auction theory.

What is The Market Trying To Do?

Week ended searching for buyers

IV. THE WEEK AHEAD

What is The Market Likely To Do from Here?

Weekly forecast:

No clear bias. Perhaps a rally early in the week. Then look for the reaction Thursday morning (after Nvidia and Walmart earnings) to dictate direction into the weekend (long holiday weekend, markets closed next Monday in observation of President’s day).

Bias Book:

Here are the bias trades and price levels for this week:

Here are last week’s bias trade results:

N/A (did not update model)

Bias Book Performance [11/17/2014-Present]:

Ether discovery down matured, others not so much

Markets fluctuate between two states—balance and discovery. Discovery is an explosive directional move and can last for months. In theory, the longer the compression leading up to a break in balance, the more order flow energy to push the discovery phase.

Market are most often in balance.

Every week this newsletter uses auction theory to monitor three instruments, the Nasdaq Transportation Index, PHLX Semiconductor Index and ethereum. Readers are encouraged to apply these techniques to all markets.

Transports still look like they are in discovery down, but the long-term balance outlined below may serve to stabilize price back into balance.

See below:

Semiconductors have that old failed auction above. Not a good look for bulls. Then last week we saw a clear conversion of support into resistance. If this chart starts to accelerate to the downside, expect the entire equity complex to follow.

Ether appears to be in balance. Whether it can brush off the weak overall context remains to be seen. But this is definitely a healthier looking chart than the two above.

IV. INDEX MODEL

Bias model is neutral into February option expiration. We were Bunker Buster three reports back. This is the second Bunker Buster in recent history, with the previous one being eleven reports back. The Bunker Buster before these recent two was forty nine weeks ago.

Neutral heading into next week. No bias.

Here is the current spread:

V. 6-month Hybrid Overbought

On Tuesday, February 1st Stocklabs went hybrid overbought on the 6-month algo. This is a ten day bullish cycle that runs through Tuesday, February 15^th, end-of-day. Here is the performance of each major index so far:

VI. QUOTE OF THE WEEK:

“You shouldn’t give circumstances the power to rouse anger, for they don’t care at all.” – Marcus Aurelius

Trade simple, stop getting worked up

Comments »

Indexmodel is calling for the short, via Rose Colored Sunglasses. Stocklabs is somewhere between a few oversold cycles and last week we had about as textbook a Bunker Buster as one can hope to expect.

With all these signalled crossed, and the way January sloppily ends on Monday, making us suffer through this wretched month for another business day, well chaps I am inclined to step aside.

I want to impart a bit of wisdom to my dear reader today. Work is about purpose. Without purpose or goals or whatever there will be a million distractions and then there is the toxic mentality of greed. More for the sake of more.

My needs are simple—to live in a progressive community full of smoking hot babes. A town with a thriving techno scene and quality bath houses. Good, nutritious food. Health for ma familia. That’s it.

I’ve earned enough to satisfy these needs indefinitely, even if I never worked another day in my life.

I’m the captain now. Now that there is no need to work I can pursue the sweet life and I shall. Speaking of, I shall make my way west later this week to enjoy some reprieve from the mundane grey streets of Detroit in exchange for a nice ski chalet up near Lake Tahoe.

With that in mind, and the way signaled are crossed, my time these next few days will be best spent getting my affairs in order. This will likely keep me out of trouble—because if I was hellbent on trading this tape next week I would be working the short side aggressively, and who know? That might be painful.

I know I haven’t really worked yet this year. I will work again soon. I figure, two months without work is a minor break. So hopefully I will find some clarity in the mountains and then come back to work.

Maybe I won’t. We don’t know.

But February has always been good to me when I don’t force opportunity. IPAs and PBJs for breakfast. Reefer and snowsports all day. Hootch and fish meat for dinner by a nice fire. Let the accounts do their things and ride into quarter end a champion.

But as always, who knows this year. This is Jim Biden’s america, a much healthier place with much less chaos and white trashedness. That chaos was pure gold for me. Now that democracy has won and the idiots have been run out of all major city centers. There is a peaceful unease amongst the people who buy stocks and other risk assets.

So we don’t know.

I hope you’ve learned something valuable from these musings. Risk assets have made men’s fortunes long before we existed and they will continue doing so long after we’re gone. So find some nice boobs and hot baths and mountains from time-to-time, or whatever sends you into a state of bliss. Then bring that energy back to the game.

Seh la,

Raul Santos, January 30th, 2022

And now the 374th edition of Strategy Session. Programming note—I will not be producing a strategy session next weekend.

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Stocklabs Strategy Session: 01/31/22 – 02/04/22

I. Executive Summary

Raul’s bias score 2.98, neutral*. Expect a choppy week. Perhaps a rally through Monday then selling pressure through Tuesday. Then watch for Alphabet earnings Tuesday after the bell to provide direction to the overall tape.

Meta reports Wednesday and Amazon Thursday, both after the bell. Then non-farm payroll could provide direction into the weekend.

*Index Model signaled Rose Colored Sunglasses (bearish), see Section V.

II. RECAP OF THE ACTION

Gap down and heavy selling Monday morning, eventually formed a sharp excess low and rallied into the close. The rest of the week was choppy but ultimately resolved higher with a Friday rally.

The last week performance of each major index is shown below:

Rotational Report:

Tech out in front last week. Bulls would ideally like to see Discretionary alongside Tech, but overall decently healthy rotations.

slightly bullish

For the week, the performance of each sector can be seen below:

Concentrated Money Flows:

The selling skews over the last eleven weeks have been dominated by sellers. Sellers skewed the ledger again last week. None of the industries on the positive side of the ledger are much use in swaying the overall market.

slightly bearish

Here are this week’s results:

III. Stocklabs ACADEMY

Signals are crossed again

Sometimes this happens. Signals start to be conflicting and the environment really is not where I trade best. Everyone’s style is different, but my strategy is to stack as many favorable statistics as possible before I engage.

There will always be another trade. The markets were here long before us and will continue on well after we’re gone. I am content to avoid the tape next week.

Note: The next two sections are auction theory.

What is The Market Trying To Do?

Week ended searching for sellers

IV. THE WEEK AHEAD

What is The Market Likely To Do from Here?

Weekly forecast:

Expect a choppy week. Perhaps a rally through Monday then selling pressure through Tuesday. Then watch for Alphabet earnings Tuesday after the bell to provide direction to the overall tape.

Meta reports Wednesday and Amazon Thursday, both after the bell. Then non-farm payroll could provide direction into the weekend.

Bias Book:

Here are the bias trades and price levels for this week:

Here are last week’s bias trade results:

Bias Book Performance [11/17/2014-Present]:

Some potential failed auctions the other way

Markets fluctuate between two states—balance and discovery. Discovery is an explosive directional move and can last for months. In theory, the longer the compression leading up to a break in balance, the more order flow energy to push the discovery phase.

Market are most often in balance.

Every week this newsletter uses auction theory to monitor three instruments, the Nasdaq Transportation Index, PHLX Semiconductor Index and ethereum. Readers are encouraged to apply these techniques to all markets.

Transports still appear to be in discovery down but if you look back to July 15^th you can see we exceeded the recent swing low only to sharply reverse. This could be a bullish set-up, a failed auction.

See below:

Semiconductors have that old failed auction above and potentially printed a failed auction below. Buyers will need to confirm this set-up by making a strong move higher.

Ether for another week still has the discovery down look.

V. INDEX MODEL

Bias model is Rose Colored Sunglasses bearish into this sloppy Monday month-end. We were Bunker Buster last report. This is the second Bunker Buster in recent history, with the previous one being nine reports back. The Bunker Buster before these recent two was forty seven weeks ago.

Rose colored sunglasses calls for sellers to pressure the tape lower.

Here is the current spread:

VI. 3 month Hybrid Oversold

On Thursday, January 13th Stocklabs went hybrid oversold on the 3-month algo. This is a bullish cycle that ended Friday, January 28th end-of-day. Here is the final performance of each major index:

VII. 12 month Hybrid Oversold

On Thursday, January 20th Stocklabs went hybrid oversold on the 12-month algo. This is a 10 day bullish cycle that ended Thursday, February 3rd end-of-day. Here is the performance of each major index so far:

VIII. QUOTE OF THE WEEK:

“A proud man is always looking down on things and people; and, of course, as long as you are looking down, you cannot see something that is above you.” – C.S. Lewis

Trade simple, with humility and kindness

Comments »

Not going to sugar coat it lads, things are looking pretty bleak in the old equity complex.

I went over last week’s data to see if any minor adjustments that may have occurred from having quality raw data instead of k-mart data would have signaled the short last Sunday. It doesn’t seem likely to model would have caught the down move.

The model is signalling Bunker Buster again. If you recall, we had one of these eight weeks ago. When they happen in close proximity of each-other like this that is a bit of a red flag.

There are other technical red flags but we won’t get into them here. Read the Strategy Session if you want to see everything I am looking at.

The real red flag is my emotional state. I am thriving right now. Winter has finally made its way into the north and it is doing wonders for my bones. I am toiling and doing gymnastics and going to the bath houses and disco raves. I’ve been doing my business in the woods like a bear and drinking hootch. It just seems like if we were really close to a bottom I would be feeling a bit more despair.

Michigan is an interesting place. We have these radical political polar opposites. Speaking with commoners of these lands yields a common thread — civil war is imminent. The lefties think it as much as the righties. I blame cable news. I don’t ever let that toxic bull shit enter my perceptual lens.

The truth is, I’ve already made it. On a fluke I bought a modest single family home in 2010 pretty close to the generational bottom in housing. Then I retired from corporate finance and found my footing as a full-time speculator. After that I learned how to grow a decent amount of my food. I know how to make beer (but I don’t right now — too busy). I have farms. Plurl. Elder Raul has a cabin in the woods I can bug out to if the city goes haywire.

I am building a complex in the city that ten trucks full of bugaloo butt clowns couldn’t breach with a full detail of assaulting rifles and rpgs. So I make my way through the world carefree and easy. On top of all of this, I am terribly good looking and folks just heckin’ like me.

Like I can disarm most situations with the power of word. And when I can’t daddy-o I can run a 4.6 second 40 yard dash and parkour my way to safety.

I can dig a hole as strongly as anyone.

At some point one has to choose freedom. This country offers it. This is the best country in the world man don’t let those fear mongering doche bags twist your mind up.

With that freedom comes responsibility. For the common man. Does that mean dying on a hill because you’re suddenly an observer of some 20-something-year old losers acting a fool? Maybe chivalry is needed. Most of the time it isn’t.

Choose your battles.

Or chose not to battle. Just build compounds and if the bandits manage to breach your fortifications, let them take the compound and go live under a bridge somewhere near a national forest.

It really is that simple lads.

But yes, markets are looking dicey. I’ll look to add some long exposure during the week but the fucking Matterhorn is not on my buy list. I am buying quality. Microsoft. Google. Tesla. COSTCO. Berkshire. WALLED MART.

Have you ever played Monopoly? Only one person wins.

Okay for now,

Raul Santos, January 23rd 2022

And now the 373rd edition of Strategy Session.

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Stocklabs Strategy Session: 01/24/22 – 01/28/22

I. Executive Summary

Raul’s bias score 1.83, STRONG BEAR*. Sellers continue to pressure the tape. Watch for a strong buyer response at some point during the week. This could mark a tradable low into the next few weeks. Possible catalysts for a reversal — Big Tech earnings Tuesday-Thursday (MSFT, TSLA, AAPL) or Fed rate decision/press conference Wednesday.

*Index Model signaled Bunker Buster, see Section V.

II. RECAP OF THE ACTION

Gap down Tuesday into the holiday-shortened week. Sellers defended the gap zone through Thursday then accelerated to the downside Thursday afternoon. Reflexive rally early Friday was overrun by sellers who continued to pressure the tape into the weekend.

The last week performance of each major index is shown below:

Rotational Report:

Full-on risk off rotation out of the equity complex.

Bearish (but also nearing extremes that could be considered bullish)

For the week, the performance of each sector can be seen below:

Concentrated Money Flows:

The selling skews over the last ten weeks have been dominated by sellers. Sellers logged another massive ledger print. Bull need to do something major to turn these tides.

bearish

Here are this week’s results:

III. Stocklabs ACADEMY

Holiday pivot LOWER

Well we seemed to have pivoted off the holiday to the downside. Perhaps this is the start (middle?) of capitulation we need to see to form a low. The selling prior to last week had been methodical, under the surface, and only hitting certain sectors.

For now sellers are in control.

Note: The next two sections are auction theory.

What is The Market Trying To Do?

Week ended searching for buyers

IV. THE WEEK AHEAD

What is The Market Likely To Do from Here?

Weekly forecast:

Sellers continue to pressure the tape. Watch for a strong buyer response at some point during the week. This could mark a tradable low into the next few weeks. Possible catalysts for a reversal — Big Tech earnings Tuesday-Thursday (MSFT, TSLA, AAPL) or Fed rate decision/press conference Wednesday.

Bias Book:

Here are the bias trades and price levels for this week:

Here are last week’s bias trade results:

Bias Book Performance [11/17/2014-Present]:

PHLX confirms the failed auction

Markets fluctuate between two states—balance and discovery. Discovery is an explosive directional move and can last for months. In theory, the longer the compression leading up to a break in balance, the more order flow energy to push the discovery phase.

Market are most often in balance.

Every week this newsletter uses auction theory to monitor three instruments, the Nasdaq Transportation Index, PHLX Semiconductor Index and ethereum. Readers are encouraged to apply these techniques to all markets.

Transports broke compression to the downside. Now this chart appears to be in discovery down. Perhaps we find a new, wider range sometime in the future.

See below:

Semiconductors confirmed the failed auction when we made a hard move away from the failure wick last week. This is a troubling set up as semiconductors are been the driver of our entire secular bull market for the last few years. A failure here could set up many quarters of bearishness. As always, we’ll take it one week at a time.

Ether still has the discovery down look.

V. INDEX MODEL

Bias model is Bunker Buster heading into month-end. This is the second Bunker Buster in recent history, with the previous one being eight reports back. The Bunker Buster before these recent two was forty six weeks ago.

Bunker Buster calls for an acceleration to the downside and an eventual formation of a tradable low.

Here is the current spread:

VI. 3 month Hybrid Oversold

On Thursday, January 13th Stocklabs went hybrid oversold on the 3-month algo. This is a bullish cycle that ends Friday, January 28th end-of-day. Here is the performance of each major index so far:

VII. QUOTE OF THE WEEK:

“A person who thinks all the time has nothing to think about except thoughts, so he loses touch with reality and lives in a world of illusions.” – Alan Watts

Trade simple, think slow, move fast

Comments »

Good evening lads,

I just did drunk yoga in Detroit. I went to a bar near ma farm and it was filled with sports women in high tech gear on rubber mats and I was like? Sure… let’s contort mammas.

I picked up a Modelo Especial from the serving wench and unfurled my mat. Striped a few layers off (it’s 15 degree Fahrenheit here) and sipped ma soda whilst the deed jay put down some whale noises.

Soon class began. I let out a few deep, earthy burps and twisted too-and-fro. Immediately caught a glimpse of a wonderfully furry womans armpit. That drives me wild.

So of course from there on out I did my best to assert my dominance, pushing deeper and stronger into the poses.

Now I am back at the bar and it’s awkward—these sports women are looking at me like I’m a eggplant sandwich and I’m drinking a marg.

Okay for now.

 

Stock market looked fucked. I’m sorry about that. I know how quickly fortunas wheel can turn. Putting me back in the dirt. But for now I’ve netted a cool 15k in nft profits on the week and tight women with hairy armpits want to eat me.

 

Grateful,

 

Raul Santos, January 20thz 2022

 

 

 

Comments »

Good day lads,

Not much to report from up here the the peaceful north. Temps are in the single digits. I can sit outside in peace without being menaced by the boomers and their souped up lawned mowers. It’s just me and the bird and the fountains. I’m pretty sure the birds are real and I dug that fountain deep so it could run through the winter and so far it is operating exceptionally.

Markets still look iffy. We need to see something major to negate seller control. Jamie Dimon calling for all those interest rate hikes last week was pretty silly. Bankers are such pieces of shit, but I suppose we’re all guilty of pandering to our own interests from time-to-time.

Striving to work towards the common good can be hard. You wouldn’t believe how many folks are out to grift. Even seemingly in need hobos will pull a fast one, coming to your coat drive and taking all the nice new coats and selling them for hootch.

Scoundrels. Of course.

We cannot let the bad actors turn us into one. There is an axiom that nice guys finish last. Well I am out to disprove it. For better or worse.

We are still in the murky zone of a risk cycle reset. We are seeing little pockets of growth—mostly metaverse stuff which why the hell not? Right? We’re all trapped, man. And also huge insurance agencies like Berkshire. You know why BRK.B is doing so well? Two reasons: folks are scared and they have actively sought to diversify their c-suite.

Having the inputs of people from different walks of live. Way different walks of life. Is a key component to success. I’ll die on this hill.

The days of a bunch of bros from the same fraternaty thriving are over, man. Look at me? I’m the captain now and my crew is quite swarthy but also has some ladies that are really fancy.

It takes a bit of this and that to make a good soup.

Okay. No sense extending ourselves into high risk stocks until the smoke clears. Berkshire and blunts until otherwise noted.

Raul Santos, January 16th 2022

One more thing — no premium data yet.

And now the 372nd edition of Strategy Session.

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Stocklabs Strategy Session: 01/17/22 – 01/21/22

I. Executive Summary

Raul’s bias score 2.83, neutral. Look for buyers to hold price above last week’s lows during the holiday-shortened week.

U.S. markets are closed Monday, January 17^th in observation of Dr. Martin Luther King Jr. day.

II. RECAP OF THE ACTION

Gap down and selling pressure through Monday morning. Then a strong reflex rally through Wednesday morning. Choppy through Wednesday before sellers stepped back in and pressured the tape. The Russell and Dow made new lows late in the week while the other majors were bullish divergent.

The last week performance of each major index is shown below:

Rotational Report:

Weakness across the board. However bulls can find some respite in the slightly bullish divergent tech sector.

Energy followed through on the strength seen two weeks back and printed another strong weekly candle.

slightly bearish

For the week, the performance of each sector can be seen below:

Concentrated Money Flows:

The selling skews over the last nine weeks have been dominated by sellers, including last week’s strong skew.

bearish

Here are this week’s results:

III. Stocklabs ACADEMY

Holiday pivot

Just an observation. I’ve noticed the markets pivoting around a holiday. There was the Valentine’s day massacre and the Thanksgiving pivot last year. I have not run a study to put statistical conviction behind this observation. It is just an interesting observation that merits additional homework. Meanwhile I will be watching for a potential pivot higher next week. Buyers need to do something big to overrun the selling pressure of these last several weeks.

Note: The next two sections are auction theory.

What is The Market Trying To Do?

Week ended searching for sellers

IV. THE WEEK AHEAD

What is The Market Likely To Do from Here?

Weekly forecast:

Look for buyers to hold price above last week’s lows during the holiday-shortened week.

Bias Book:

Here are the bias trades and price levels for this week:

Here are last week’s bias trade results:

Bias Book Performance [11/17/2014-Present]:

PHLX held range low but still has a failed auction print

Markets fluctuate between two states—balance and discovery. Discovery is an explosive directional move and can last for months. In theory, the longer the compression leading up to a break in balance, the more order flow energy to push the discovery phase.

Market are most often in balance.

Every week this newsletter uses auction theory to monitor three instruments, the Nasdaq Transportation Index, PHLX Semiconductor Index and ethereum. Readers are encouraged to apply these techniques to all markets.

Transports perhaps have the most interesting chart. Keep an eye on this compression, the eventual break could provide clarity on overall market direction.

See below:

Semiconductors give us caution due to the failed auction above but did rally hard off of range low. This is another interesting balance and until it resolves it is difficult to forecast overall market direction.

Ether will be monitored going forward as a third contextual component. The ethereum network currently has a market cap just under $500B. The PHLX is about $3.5T. Therefore while we analyze ether alongside semiconductors, we ought to give more contextual weight to semiconductors than ethereum.

Ethereum continues to have a discovery down look.

V. INDEX MODEL

Bias model is neutral heading into the third week of 2022. Mode printed a Bunker Buster signal seven reports back. The Bunker Buster before the most recent one was forty five weeks ago.

No bias heading into the week.

Here is the current spread:

VI. 3 month Hybrid Oversold

On Thursday, January 13th Stocklabs went hybrid oversold on the 3-month algo. This is a bullish cycle that ends Friday, January 28th end-of-day. Here is the performance of each major index so far:

VII. QUOTE OF THE WEEK:

“We must accept finite disappointment, but never lose infinite hope.” – Dr. Martin Luther King Jr.

Trade simple, expect to win, accept the losses along the way

Comments »

Alright the good news is Stocklabs is alive and well and as useful as ever. I was able to put together a research report that I have about 80% confidence in which is better than nothing.

I still need to resolve this premium data fiasco if I am to power my market profile charts. That means I likely will not be actively trading NASDAQ futures Monday. But I put some emails out over the weekend, and I expect to be up-and-running by week’s end.

Some red flags jumped out, and while we may be temped to turn to popular Twitter accounts or to watch the television doom screen, the entire situation can be responsibly managed by keeping the PHLX semiconductor index pulled up on one of your screens at all times.

One of the market’s favorite behaviors is to test beyond a prior swing level, fail and sharply reverse. We call them failed auctions. Often it means our next course of action is to return to the midpoint of whatever balance we attempted to escape, and then the next move is a test of the opposite edge of balance.

Semiconductors are vital to the secular bull these we carried into the new decade. This could be the beginning of a meaningful correction. As always, we don’t know. But we have earning out of major component $TSM Thursday before the open and that may give us some clarity on whether semiconductors will continue to hold this big-ugly-year-long balance or begin to trend lower.

Another micro economic factor to keep on our radar re: semiconductors is the deal NVIDIA is perusing to acquire Arm Holdings. It is being held up by an FTC suit and E.U. investigation. The outcome would likely put some movement into the PHLX also. Elevated risk.

Any other seemingly meaningful “news” can likely be tuned out. It’s not going to help us find the clarity we need to work the tape well.

Okay for now, yes? We’ll take things as they come.

Raul Santos, January 9th, 2022

And now the 371st edition of Strategy Session. She’s a little dodgy, but enjoy:

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Stocklabs Strategy Session: 01/10/22 – 01/14/22

I. Executive Summary

Raul’s bias score 2.58, medium bear. Sellers continue to pressure the tape lower through Tuesday morning. Then the action could become choppy with Fed’s Powell set to speak Tuesday at 10am. Keep an eye on the PHLX semiconductor index. It looks set up to probe the low-end of recent range. The behavior of the key index is likely to drive broad equity prices. Earnings out of Taiwan semiconductor Thursday morning are likely to provide visibility on direction heading into the end of the week.

II. RECAP OF THE ACTION

Some strength Monday to start the year. The Dow continued higher through Tuesday but stalled and formed a failed auction after making new record highs. Heavy selling Wednesday and grind lower for the rest of the week.

The last week performance of each major index is shown below:

Rotational Report:

Discretionary and Tech once again under pressure along with Healthcare. Financials were strong, perhaps with investors positioning themselves early for the expected rate hikes later this year.

Energy continues to trade in its own world, vulnerable to geopolitical risk. The most recent risk is associated with violent protests and calls for removal of the current government in Kazakhstan.

For the week, the performance of each sector can be seen below:

Concentrated Money Flows:

The selling skews over the last eight weeks have been dominated by sellers. Last week’s skew was slightly to the negative side.

slightly bearish

Here are this week’s results:

III. Stocklabs ACADEMY

New year new volatility

Price calmly drifted into year end. As long as you were positioned with the biggest and best, it was a decent close to the year. Volatility returned during the first week of trade, even hitting Big Tech.

This environment has been kind on Financials though. I don’t particularly care for the sector, but I have been a big fan of Berkshire Hathaway, especially due to their recent commitment to diversity in the c-suite.

Investors carry guilt by nature. To have the ability to invest is a privilege, and then to make capital gains from doing nothing more than assuming risk can make one feel they’ve done something wrong.

That is why I look for investments into places that ease those troubles. Berkshire fits the bill and Buffet is the stuff of American folk lore.

Note: The next two sections are auction theory.

What is The Market Trying To Do?

Week ended searching for buyers

IV. THE WEEK AHEAD

What is The Market Likely To Do from Here?

Weekly forecast:

Sellers continue to pressure the tape lower through Tuesday morning. Then the action could become choppy with Fed’s Powell set to speak Tuesday at 10am. Keep an eye on the PHLX semiconductor index. It looks set up to probe the low-end of recent range. The behavior of the key index is likely to drive broad equity prices. Earnings out of Taiwan semiconductor Thursday morning are likely to provide visibility on direction heading into the end of the week.

Bias Book:

Here are the bias trades and price levels for this week:

PHLX failed auction is a huge red flag

Markets fluctuate between two states—balance and discovery. Discovery is an explosive directional move and can last for months. In theory, the longer the compression leading up to a break in balance, the more order flow energy to push the discovery phase.

Market are most often in balance.

Every week this newsletter uses auction theory to monitor three instruments, the Nasdaq Transportation Index and the PHLX Semiconductor Index. Readers are encouraged to apply these techniques to all markets.

Transports made a strong move a few weeks back and have since retraced a portion of it. Buyers may come into the week intending to convert recent resistance around 6606 into support. Unlike semiconductors, transports have a mini failed auction below, which may help keep prices elevated. Earnings out of Delta Thursday morning might provide some clarity to this chart.

See below:

Semiconductors broke out from balance, made a new high, the auction stalled and failed and now we are back in range. This is a troubling set-up for bulls and is likely to lead to a test of the bottom of the recent range. It could lead to a much larger sell-off.

Ether will be monitored going forward as a third contextual component. The ethereum network currently has a market cap just under $500B. The PHLX is about $3.5T. Therefore while we analyze ether alongside semiconductors, we ought to give more contextual weight to semiconductors than ethereum.

Ethereum appears to be in a discovery down phase. Buyers have been defending the 3,000 millennial mark over the weekend, but there is no sign of clear balance yet. This chart is discovery down heading into week two of the year.

V. INDEX MODEL

Bias model is neutral heading into the second week of 2022. Mode printed a Bunker Buster signal six reports back. The Bunker Buster before the most recent one was forty five weeks ago.

No bias heading into the week.

Here is the current spread:

VI. 3 month Hybrid Overbought

On Wednesday, December 22^nd Stocklabs went hybrid overbought on the 3-month algo. This happened right as the prior signal ended, thus generating a fresh 10-day cycle. This is a bullish cycle that ends Thursday, January 6th end-of-day. Here is the performance of each major index so far:

VII. QUOTE OF THE WEEK:

“I have observed that those who have accomplished the greatest results are those who “keep under the body”; are those who never grow excited or lose self-control, but are always calm, self-possessed, patient, and polite.” – Booker T. Washington

Trade simple, kindly

 

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Happy New Year dearest iBankCoin lads.

I sort of took the first week off. Not by choice. My premium data feed was cut-off at the strike of midnight. I came into the new year cold and alone with no data to soothe me.

Apparently a good friend of mine had pinned me into a legacy rate all these years ago and it finally expired and now they don’t want to make good on the offer anymore.

They want me to pay many more dollars per month for data. And I took offense to it because as soon as the new year struck it seemed like everyone was out for me lucky charms.

Modern society preys on the weak. Oh, 50-some-year-old lady, you’re locked out of your Robinhood account? I have called to help. Please send me a photo of your driver’s license and stay on the line with me. We’ll have this resolved lickety-split. Click.

And just because there are tens of thousands of miserable fucks who would just as soon rip your eyeball out and feed it to you doesn’t mean we have to stoop to their unsavory tactics.

Did anyone see that video of the giant rockslide in Brazil over the weekend? The commentary below the video is fucked. Fine, make light of multiple deaths. But other people go so far as writing things like, “fuck’em.” So tough and miserable behind their computer screens.

And soon we’ll be even more immeresed in the world-wide-web. Have you chaps strapped into the new Oculus yet? Absolutely incredible. A huge step towards the end of productive humanity. But also a tool that will empower a whole new generation of creators to do powerful things. I suppose it comes down to the guidance of our youth.

I have a clear goal. I always have. Without it I would be washed away by the torrential stream of opportunities that cross my desk on a weekly basis. My job is to extract as many fiat dollars as possible from the global financial complex. Said dollars are then to be converted into real assets—modern agricultural equipment that automates the process. Good cement with drain pipes and radiant heat running through it. Giant pole barn warehouses with forklifts and electric vehicle charging.

Society may be on a trajectory that is leaving most of yous behind, but I have been playing this game from 5 years in the future for quite some time. As soon as some enterprising mother fucker with deeper pockets gets hip to my latest idea, I’ve already skimmed the creme. They can have the milk of it. I am not here to trudge through life earning an 18% EBITDA. Fuck that.

ALL THIS STATED…my negotiations for premium data are ongoing. I have feelers out with a couple other data providers, but no deal yet. Therefore I do not have the information I need to produce IndexModel. Two weeks without Sunday research would legitimately make me feel sick. So I am going to put together a mini report in a bit.

Stay tuned.

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This game really is beautiful, isn’t it? And for the most part we’ve convinced everyone to play it. Even those red commies committed to putting down the sword and picking up the computer and going to work, toiling, in industry and game. We’re all here, clicking buttons and pulling various levers in economic combat, essentially with the only violence being the taking of moneys from one another.

The lines on the map are fading. Nation-states, a popular ethos taken up after the fall of the Holy Roman Empire in the mid-1500s, is finally on its way out. Took hecking long enough but here we are.

I don’t care how many crowds full of high-school dropouts pile into the NASEDCAR gaming tracks and chant vugarities, there is no more risk of a revolution.

This drives the jaded liberal nuts. Their faces, constantly kept pushed into the latest news cycle to the point of suffocation, their so hecking on edge that when I tell them nothing matters they go bananas.

But the fact is nothing matters. We’ve come to far. Western civilization has won. The fairy tails that kept communities under control for many hundreds of years are being clearly seen for what they are. Too many people have the internet. And books and games and documentaries and trivia games, all in the native tounge. And with enough presentation of facts they all come to the same conclusion that it’s all a silly power game.

And the rules have shifted. Now it is all about who has the most nimble warchest and who has the ignition keys to the internet cannons?

Numbers on screen flutter around and fortunes are made and lost. The big ponzi keeps on ticking.

The key is to gain a sense of who is currently competing and whether they have the resources to out gun a little squirrel on their home computer with a few 100k in their armory.

Remember, a crocodile can go a decade without feeding. I reference this often. They just sit there, in a puddle of mud waiting for the big meal to stumble down in and then WHACK! They strike and feed and gorge with the speed an tenacity of an apex predator.

In speculation I am the crocodile. That is why I couldn’t buy into those bored apes. They didn’t fit my ethos. But I knew I needed to feed on the NFTs. There was no reason to look down my nose at that big dinner.

Penguins were close enough. I love the winter and FISH MEAT. So I am a penguin now, while I wait for my rabbit virtual reality hedonist layer to be built. Then when we go 3-d I will be a wiry rabbit who loves a to disco dance and have sex with bunnies.

Okay see I wrote too long and now it has gotten weird.

Trading will be limited this week. I am back to lifting weights again, but I have to go at 7am before all the spittle blowing buffoons show up and stink up the whole place like leaky shit ass.

Ho ho ho.

Raul Santos, December 26th 2021

And now the 370th edition of Strategy Session. Enjoy.

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Stocklabs Strategy Session: 12/27/21 – 12/31/21

I. Executive Summary

Raul’s bias score 3.83, medium bull*. Price drifts sideways throughout the final week of the year, perhaps with a slight upward bias.

*extreme Rose Colored Sunglasses (e[RCS]) bullish bias triggered, see Section IV.

II. RECAP OF THE ACTION

Gap down Monday and test of last week’s low. The auction stalled and turned higher and we rallied for the rest of the holiday-shortened week.

The last week performance of each major index is shown below:

Rotational Report:

Just the most ideal rotations for bulls, especially after seeing Discretionary and Tech come under heavy pressure two weeks back. Utilities, Staples and Financial rotated away from—suggesting risk appetite was elevated throughout last week’s rally.

bullish

For the week, the performance of each sector can be seen below:

Concentrated Money Flows:

The bullish skew seventeen weeks back was negated six weeks ago. Then we had three consecutive weeks of heavy sell flows, where four weeks back was the most extreme we’ve seen yet.

Two weeks back we had another may selling skew (ledger dominated by sellers).

Last week the ledger did skew to the positive side, but not to a magnitude high enough to cancel out the heavy selling skews of recent past. Also the positive side of the ledger was populated by less-than-idea industry groups.

slightly bearish

Here are this week’s results:

III. Stocklabs ACADEMY

Clean year end

On the last report we leaned on the 11/28 bunker buster as our swing low. Our theses was tested last Monday and prevailed. While the low was taken out slightly, the auction immediately reversed higher. Thus forming a quality-looking low.

Now we have this final week of 2021. I suspect some active market participants are taking the entire week off. But there algorithms or apprentices are surely manning the proverbial work stations to ensure the markets behave.

Barring some unexpected geopolitical event, with all the context we have the expectation is for a drift into year-end. If we push far in either direction early in the week, I will be on the lookout for a trend reversal back to the mean (weekly unchanged).

That said, I see no need to fade a strong rally early in the week (or even to sell down any positions). But I may not buy additional risk should we rally early in the week.

Note: The next two sections are auction theory.

What is The Market Trying To Do?

Week ended searching for sellers

IV. THE WEEK AHEAD

What is The Market Likely To Do from Here?

Weekly forecast:

Price drifts sideways throughout the final week of the year, perhaps with a slight upward bias.

Bias Book:

Here are the bias trades and price levels for this week:

Here are last week’s bias trade results:

Bias Book Performance [11/17/2014-Present]:

Lows rejected // finding balance

Markets fluctuate between two states—balance and discovery. Discovery is an explosive directional move and can last for months. In theory, the longer the compression leading up to a break in balance, the more order flow energy to push the discovery phase.

Market are most often in balance.

Every week this newsletter uses auction theory to monitor three instruments, the Nasdaq Transportation Index and the PHLX Semiconductor Index. Readers are encouraged to apply these techniques to all markets.

Transports have us monitoring a compression. The short-term discovery down we called for last week came to an end last Monday when this key contextual index printed a failed auction. A three day rally followed. Now it appears we have indeed made a higher-low in an intermediate term discovery up phase. The short-term auction is in balance/compression.

See below:

Semiconductors held the low-end of range and still appear to be in balance.

Ether will be monitored going forward as a third contextual component. The ethereum network currently has a market cap just under $500B. The PHLX is about $3.5T. Therefore while we analyze ether alongside semiconductors, we ought to give more contextual weight to semiconductors than ethereum.

Ethereum could still be in discovery down. The $4,000 millennial mark appears to behave as a pivot between discovery down and balance. All that stated, the call heading into next week is for balance.

V. INDEX MODEL

Bias model is signaling extreme Rose Colored Sunglasses (e[RCS]) bullish bias after being neutral for three weeks. Before those neutral prints we had a Bunker Buster signal four reports back. The Bunker Buster before the most recent one was forty three weeks ago.

Heading into the final week of 2021 Index model is calling for a calm-sideways drift perhaps with a slight upward bias.

Here is the current spread:

VI. 3 month Hybrid Overbought

On Wednesday, December 8^th Stocklabs went hybrid overbought on the 3-month algo. This is a bullish cycle that ends Wednesday, December 22^nd end of day. Here is the final performance of each major index:

VII. *new* 3 month Hybrid Overbought

On Wednesday, December 22^nd Stocklabs went hybrid overbought on the 3-month algo. This happened right as the prior signal ended, thus generating a fresh 10-day cycle. This is a bullish cycle that ends Thusday, January 6th end-of-day. Here is the performance of each major index so far:

VIII. QUOTE OF THE WEEK:

“In this formative period, the soul is unsoiled by the warfare with the world. It lies, like a block of pure, uncut Parian marble, ready to be fashioned into—what?” – Orison Swett Marden

Trade simple, step away and refresh the mind as needed

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Ho ho ho chaps. As you may recall, we came into the week operating under the notion that low-of-week was in. That was not the case. We ticked the low late-morning Monday, and then the low looked even better.

And now we are rallying in all the right places. Probably because some cool-headed woman entered the citadel and flipped the proverbial switch, saving us boneheaded men from our troubleshooting chicanery. The best gains are happening in the best places, of course.

Tesla motors.

Ama-zon’d books.

Goo-gedle omnipotent.

Alt-coins ponzis.

What a time to be alive. Be sure to spread some pagan xmas cheer you animals.

Raul Santos, December 22nd, 2021

 

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I make forecasts based off of cold data. Sure, I use words to gussy it up, to make this simple but tough business a bit easier to bear. But my calls are backed by signals generated both autonomously by Stocklabs and manually via the indexmodel process.

On 11/28 Indexmodel signaled bunker buster for the first time since February 28th. You may ask yourself, “what good is a signal that fire that infrequently? Daddy needs more trades.” I find great solace in such an indicator. The thing about your humble pal Raul [hpR] is he works way too hardt. Doing things most of yous would quickly call it quits on.

I peeled 17 mattress out of the ground behind my urban farm. A group of boys, poor as it gets and left without the oversight of a reasonable person, built some kind of wrestlemania jump park on what was then abandoned land. Earth eventually grew over it, and I had no idea it was there when I shelled out the dough for the land.

I probably should have rented a bobbed cat to make short work of the endeavor. But I channeled my immigrant grit and mined them one-by-one with pick and lever bar.

Everyone wants to be early. To have been in Brooklyn before they were priced out. Or Tesla when it was $40/share. Or Bored Apes when they were 0.25e. But most folks don’t know the reality of being early.

In fact, often times folks are too early. Or they’re just plain wrong.

But being early in urban real estate is not glamorous. It can be exponentially rewarding, and I know what it takes to activate a site, to create a conduit of opportunity and eventually a flywheel that spits out moneys.

Enough of that. It doesn’t matter. That’s ego taking over.

The infrequent signals are something I can use to allot capital to long-term investments without too much thought.

The signals are the signals are the signals. The signals are telling me low of month is in. They are not a 100% win rate.

This time could be a loser. It is not my job to predict that. My job is to click to buttons on the computer that make the numbers on the screen go from my bank account to my brokerage account and then into FB, BRK.B, GOOGL, AMZN and so on.

Maybe next week numbers go up. We don’t know.

Okay for now.

Raul Santos, December 19th 2021

And now the 369th edition of Strategy Session. Enjoy.

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Stocklabs Strategy Session: 12/20/21 – 12/24/21

I. Executive Summary

Raul’s bias score 2.83, neutral. Buyers regain control of the tape. Equity prices rally throughout the holiday-shortened week.

U.S. markets will be closed Friday in observation of Christmas.

II. RECAP OF THE ACTION

Small gap up to start the week. Sellers drove lower all day Monday and we were gap down Tuesday. Sellers kept price down on the lows until the Wednesday afternoon FOMC rate decision and press conference introduced a strong bid. All of Wednesday afternoon’s rally was reversed Thursday by a trend down. There was some continuation lower early Friday before buyers stepped in and stabilized prices into the weekend.

The last week performance of each major index is shown below:

Rotational Report:

Key tech and discretionary sectors saw heavy selling on the week. Meanwhile investors rotated into risk averse utilities and staples. Healthcare also strong.

slightly bearish

For the week, the performance of each sector can be seen below:

Concentrated Money Flows:

The bullish skew sixteen weeks back was negated five weeks ago. Then we had three consecutive weeks of heavy sell flows, with three weeks back being the most extreme we’ve seen yet.

Two weeks ago the ledger skewed slightly negative, but we saw a nice pocket of semiconductor groups on the positive side of the ledger. However last week we saw another major negative skew.

bearish

Here are this week’s results:

III. Stocklabs ACADEMY

Less attention, time to rally

By the end of last week the prevailing sentiment seemed to be exhaustion. The uptick in volatility paired with a negative news cycle has taken its toll on most of the active market participants I monitor.

Add in the stress of year-end, holiday preparations, and we might have reached the point where folks step away.

I’ve thought we reached this point for weeks, and perhaps I am merely projecting my own state onto the behavior of the markets.

I am leaning on the signaling from indexmodel and Stocklabs. The bunker buster signal on 11/28 still marks our local swing low, and we have three days left in the 3-month hybrid overbought signal that triggered December 8^th.

I pair these two emotionless indicators with my own subjective read of sentiment. I layer in calendar/moon context and formulate this forecast. Is it perfect? Absolutely not. But it is the best method I’ve come up with.

Note: The next two sections are auction theory.

What is The Market Trying To Do?

Week ended searching for buyers

IV. THE WEEK AHEAD

What is The Market Likely To Do from Here?

Weekly forecast:

Buyers regain control of the tape. Equity prices rally throughout the holiday-shortened week.

Bias Book:

Here are the bias trades and price levels for this week:

Here are last week’s bias trade results:

Bias Book Performance [11/17/2014-Present]:

Ether has clear reading, the others are not discovery down

Markets fluctuate between two states—balance and discovery. Discovery is an explosive directional move and can last for months. In theory, the longer the compression leading up to a break in balance, the more order flow energy to push the discovery phase.

Market are most often in balance.

Every week this newsletter uses auction theory to monitor three instruments, the Nasdaq Transportation Index and the PHLX Semiconductor Index. Readers are encouraged to apply these techniques to all markets.

Transports are beginning to compress. Short term it looks like discovery down. Intermediate term we’re still in the process of making a higher low—discovery up. Put it together and it looks like balance/compression.

See below:

Semiconductors printed a massive red candle Thursday but for now appear to be in balance.

Ether will be monitored going forward as a third contextual component. The ethereum network currently has a market cap just under $500B. The PHLX is about $3.5T. Therefore while we analyze ether alongside semiconductors, we ought to give more contextual weight to semiconductors than ethereum.

Ethereum transitioned into discovery down last week by leaving its recent balance zone behind via a series of lower highs and lows. See below:

V. INDEX MODEL

Bias model is neutral for a third week after signaling Bunker Buster three reports back. The Bunker Buster before the most recent one was forty two weeks ago.

Heading into the holiday-shortened week neutral. No bias.

Here is the current spread:

VI.12 month Hybrid Oversold

On Wednesday, December 1^st Stocklabs went hybrid oversold on the 12-month algo. This is a bullish cycle that ends Wednesday, December 15^th end-of-day. Here is the final performance of each major index:

VII. 3 month Hybrid Overbought

On Wednesday, December 8^th Stocklabs went hybrid overbought on the 3-month algo. This is a bullish cycle that ends Wednesday, December 22^nd end of day. Here is the performance of each major index so far:

VIII. QUOTE OF THE WEEK:

“The first principle is that you must not fool yourself—and you are the easiest person to fool.” – Richard Feynman

Trade simple, execute the system

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