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Independence Day vibe is bullish and lazy

I have been slacking on my market research routines and this is not something I want to get into the habit of doing.  The Sunday research I began 241 weeks ago elevated my trading.  The morning trading reports have always been my rock, even in the most uncertain times.

This week starts with a Monday the first day of a new quarter.  That means I will be making an adjustment to the quant system I run using Exodus and Motif.  Then I will likely be taking the rest of the week easy.

I’ve been all around this great big world and there are few places more enjoyable than Michigan these next few weeks.  It is real hot, not that California pleasant heat but real, oppressive temperatures.  There are freshwater rivers and lakes everywhere.  Spirits are high.  Therefore as important as it is to not become lazy with my research, I can also avoid error by simply not trading.

The market will still be here when I dial back in, just like it was here long before and will be here long after.  Cheers to free market capitalism.  It is the only ethos worth acknowledging.

Now I must be going, a good friend’s birthing day party is about to kick off at a nearby swimming pool.

ciao ciao and kiss kiss

-Raul Santos, June 30th, 2019

Exodus members, the 241st edition of Strategy Session is live.

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Summer is finally here, sweet summer hallelujah, models are bullish again

That Bunker Buster signal on 06/02 was really something, wasn’t it?  Paired with an Exodus Hybrid Oversold that fired that Friday before the weekend, and we had double the reason to wake up Monday morning, huevos swinging low as we came to market and bought equities.

That bearish signal last Sunday was not the same.  It was like, “Really IndexModel?  Your robot brain thinks it’s a good idea to short here, just a few bull thrusts away from all-time highs, in the wake of a Bunker Buster no less?”  I began shorting /nq_f late Monday and actually saw some traction.  I positioned into SQQQ.  It was maybe looking like an okay move, given the mid-week Federal Reserve wild card.

There was a clear third reaction up to the Fed actions and it was then that I abandoned my short selling campaign, leaving only SQQQ to ride because that is how I trade IndexModel.  It is a five day commitment.  I only tweet when neccecary and third reaction almost always earns a tweet:

But given the CONTEXT, you know, summer time, third reaction up, bunker buster a few weeks ago, hovering near record highs, I didn’t waste my time in front of the computer, shorting the nq_f.

Context was a missing link to my success as a trader for a long time.  All the mentors I found and paid good money to for help could not properly use their words to describe what context was.  They kept it down in their gut or something I don’t know.

Anyways I did my best to quantify context and every.single.day. I do my best to use my words, here in the sacred halls of iBankCoin and on Twitter to call out context.

That’s all I have to say about that.  Models are back to bullish and there is an island in Detroit calling my name.  Enjoy the first day of summer fam, for tomorrow we go back to pulling fiat out of the financial system.

Raul Santos, June 23rd, 2019

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Free Exodus Strategy Session, it calls for more chop

It is well past the time of day when I normally conduct financial research, and earlier I subjected myself to 75 minutes of hatha-style contorting.  Pair that with intermittent downpours of hot rain, and the act of preparing this Sunday’s Exodus Strategy Session was a bit of a sluggish go.  It’s still solid research.  When I began publishing my findings into Exodus, I was met with an issue at the private entryway behind the paywall enjoyed by iBC elites.  Perhaps The Fly has revoked my access card.  In any case, I was forced to make an executive decision to put the report live outside the paywall, in the ghettos of iBankCoin where public conversation regularly drifts to violence and impulse.

Therefore you have, you all have unfettered access to my weekly research.

For the c-suite types roaming about these back allied streets, who need to return to turning tricks or whatever it is you all do, the executive summary is sufficient reading.  It sums up, in as few words as needed, what I expect to happen over the next five trading days.

Enjoy this 235th edition of the Strategy Session on the house, gyarrrr.

Raul Santos, May 19th 2019

—————————————-

I. Executive Summary

Raul’s bias score 3.08, neutral.  More chop.  Look for price to mark time via volatile price action that accomplishes little directional discovery.  Watch for the third reaction after the FOMC minutes Wednesday afternoon to provide direction into the second half of the week.

II. RECAP OF THE ACTION

Big gap down into Monday for the second consecutive week. Monday closed week but the rest of the week was spent discovering higher prices.

The performance of each major index is shown below:

Rotational Report:

Rotation into risk averse sectors

slightly bearish

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

Concentrated Money Flows:

Exodus [PPT 2.0] streamlines how we can research the individual behavior of each industry and how it pertains to overall market sentiment.

Using the Industries screen, we can filter for the Median Return [1 week] of each industry.  I have established an arbitrary -/+ 3% cutoff for qualifying industries of interest.

Money flows skewed bullish in a subtle way, with many key driver industries populating the positive side of the ledger.

bullish

Here are this week’s results:

III. Exodus ACADEMY

Still on the bearish side of  ‘Hybrid Chg %’

I have found it extremely useful to monitor the ‘Hybrid Chg %’ column on the Historical tab, which is found under the Market drop down menu.

That big -12.15 reading printed on March 22nd dropped off page 1 last Tuesday.  Then Friday May 3rd, Exodus printed a big plus 10.

But only a few short days later an even bigger negative 10 hit.

The data point is yet to be taken out, despite some conviction buy days Wednesday and Thursday.

CAUTION

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?

Bias Book:

The following biases were formed using basic price action and volume profile analysis. By objectively observing these actual attributes of the market we gain a sense of the overall market context. To quantify the effectiveness of this approach, each of the 4 equity indexes (/ES, /NQ, /YM, and /TF) has been assigned a fixed long/short target using a standard 14-period ATR. Each week there will be an outcome of win, loss, or timed stop on all four indexes. The first bracket level hit is deemed the winner in the event that both sides are tagged. This will be tracked and included in the Exodus Strategy Session.

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

[Note: All levels are as quoted on the front month future contract (currently June 2019) by the IQFeed Data Servers. Prices may differ slightly from your data provider. If you do not have a platform which provides real-time futures quotes, please click here for a free (but limited) alternative.]

Here are last week’s bias trade results:

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

Compression Watch: Semiconductors fall back into balance, Transports balance out

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, the more order flow energy to push the discovery phase.

We are monitoring two instruments, the Nasdaq Transportation Index and the PHLX Semiconductor Index.

Transports seemed to find buyers below the key support level lost two weeks back, and the index now looks to be back in balance.

See below:

The semiconductor index lost a support level we expected to hold and are now back inside a wide balance area dating back more than a year.  Expect the levels slightly lower to behave like a magnet for price.

See below:

V. INDEX MODEL

Bias Model: neutral

Bias model is neutral for a second consecutive week after six consecutive bullish weeks.

Here is the current spread:

Vi. QUOTE OF THE WEEK:

“Pay attention to what’s in front of you—the principle, the task, or what’s being portrayed.” – Marcus Aurelius

Trade simple, handle every trade at your best

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Q2 scaries: so many red flags yet we continue to rally

I have a long working list of reasons this market shouldn’t (the most dangerous word in speculation) be rallying, yet here we are again, just a 150 points or so from all-time highs on the NASDAQ.  The PHLX semiconductor index is already there.  This weekend more reasons were added to the ‘should not be rallying’ list like the continued leadership by the Materials sector.  What’s up with that?  Is inflation starting to be a thing, in a bad way?  Headlines are scary too, way too rosy, look at this hubris from Barron’s:

So yes, I am cautious.  But the system is the system and IndexModel, the model I built with brawn and raw exchange data is my only faithful guide during my active campaign to extract fiat American dollars from the global financial complex.  And IndexModel again signaled bullish this Sunday.  Therefore my directional bias these next five days is higher.

If we believe the markets to be a wholly efficient mechanism which has priced in all known information, then there are very few factors we need to consider before making a decision to buy or sell.  In reality, all we need to monitor is the way some goods are currently auctioning.  It is the flow of orders that happens in real time that gives us the relevant information we need to make day-to-day entry and exit decisions.

When it comes to investing, it helps to hard wire some assumptions into place. Things that only need to be reconsidered infrequently and ideally when you are high atop some mountain or way out in the ocean.  Some of my hard wired assumptions:

The Federal Reserve is the most powerful entity in the world.

Millions of W-2 employees blindly feed money into the stock market every pay period and their entire retirement is dependent upon a thriving stock market.  To placate the masses, The Fed will keep this puppy propped.

Technology has changed the pace and shape of economic cycles, and right now we are on the hockey stick growth curve portion of a Moore’s Law-esque chart (see: Let’s talk about AI and crocodiles for more info).

Baby boomers are finally losing control.

The economy is a zero sum game.

Nature always wins and is indifferent.

Market timing is possible.

Dollar cost averaging is easier.

With those rules in place, I only want to invest in cults.  If Scientology had a ticker you best believe I would own it.  Cults I will always have exposure to: Apple, Amazon, Google, Tesla, Adobe, Goldman Sachs, Twitter, Microsoft, bitcoin, longevity (CRISPR, etc).

Back to trading.  Trading is not investing.  You cannot dabble in trading just like you cannot dabble in mixed martial arts.  There are people like me who take trading very seriously.  There are thousands of hours of research, reams of data, planning, and thousands of hours of devoted screen time behind every trade I take.  I am ruthless and fast, like a fox, because the competition has more resources and plays as dirty as they can.  When you step into an arena like electronic futures, nothing else matters but the auction and mental clarity.  Distractions kill.  Hubris, kills.  Errors, kill.

To trade you need private office space fitted with some decent machinery (unless you’re sharing a space with other fully devoted traders).  You need full, distraction-free autonomy for at least 2-3 hours, lots-and-lots of money to lose while you learn, and a commitment to the craft.

Anyhow I am rambling.  Sunday research is complete, it is cautiously bullish heading into the second full week of Q2, and pretty much every thing we need to know will be seen on the PHLX semiconductor index.  Be sure to check out the morning trading reports, which I post around 9am New York.

I am off to shake away these Q2 scaries by digging some holes in the yard.

Cheers and trade’em well

Raul Santos, April 7th, 2019

Exodus members, the 229th edition of Strategy Session is live, go check it out!

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Lyft did not kill the equity markets (yet) what you need to watch heading into Q2

Late last week I allowed my mind to paint a negative bias onto the market.  My ego took a commanding lead on my thoughts for petty reasons—I never liked LYFT really, begin in bed with General Motors and all, with their money losing livery service.  For that matter I’ve got a bit of a bias against these unicorn IPOs, probably because they’ve lost me so much money (see: Snapchat o_0).  My pride has been assaulted by hyped up IPOs, but so what?  Other factors were at play.

As solid as my March Madness stock looked heading into last week, I lost to Operator, whose stock also looked real nice heading into the week.  When I say, ‘looked nice’ I mean the daily price charts looked, to my trained eye, like charts that would go up.  Anyways, as much as one week doesn’t matter to my position, I lost.  Again, petty.  I lost a game.

Anyways, the models lads, throughout my emo Friday, were expecting higher prices.  They couldn’t care less that one percenters were dumping their unicorn shares into public markets by the billions, or that RAUL was losing some website tournament.  Never.  They do not concern themselves with the petty.

The models are a better guide than emo RAUL any day.  Heading into Q2 they are bullish.

I have a long list of reasons ‘why’ this market should (such a nasty word) be selling off but by golly it isn’t.  It could.  And maybe it will.  If I want to know ahead of time I think I know how.  The only way to think beyond the logical parameters of IndexModel is to watch the PHLX semiconductor index.  It has told the story for years, often a few weeks ahead of the broad market.  You don’t have to take my word for it.  Go back and look for yourself how the October 2018 breakdown preceded the market-wide selling.  Or what it has done since.

Any reasonable reader should now be asking me what will happen next.  Of course I don’t know.  But I do know exactly what level to watch and a few ways we could behave around that level and that will give me the conviction I need to take action.  That level, until further notice, is called ‘Resistance becomes support’ and is shown below in black:

Saturday was a lovely spring day, with heavy rains falling from sunrise to sunset, then turning to snow overnight.  Today I woke to a surreal landscape of snow and ice, and it felt like some much needed breathing space.  I was not ready for the second quarter.  For spring.  Now I am.

You can be too.

RAUL SANTOS, March 31st, 2019

Exodus members, the 228th edition of Strategy Session is live, go check out my notes in Section IV where I lay out the two scenarios for upside/downside on the PHLX.

 

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Another week applying the process to make the moneys

Apparently my finance/trading content sucks.  It’s self-serving, unoriginal, and as if that weren’t enough—it’s rude.

The annoying thing is, I’ve been way more ‘right’ in my approach and predictive analysis than all the popular accounts.

A blog that only exists for the sake of improving my own trading game.  I’ve been doing this for a real long time, hardcore addicted to trading, studying, learning, blogging and communicating my technique since 2009.  I tried to make my words more entertaining for a while.  My views went way up, my ego followed alongside, and my trading suffered.

Nowadays I only blog about a news bit or ticker symbol or macro thingy if I think something really needs to be said.  The morning reports read like instructions for a universal remote.  They are filled with money making goodies, like LITERALLY the best nq_f trading levels in the industry, but you don’t care.  You want to be entertained, perhaps to escape an otherwise monotonous job in the wonderful world of finance.

Save yourself the time then and steer clear of the RAUL blog.  This is a place for hardcore traders who are determined to take control of every investment/trading decision made on their own behalf (and perhaps for the people they hold dear), and to do so with the explicit intent of extracting fiat from the global financial complex.

MOVING ON

The model is bullish again.  It was neutral last week, but all you had to see was Monday morning’s action to know what needed to be done Tuesday.  Many a RAUL blog have centered around how to trade the day after a trend day, I’m sorry I wasn’t here to refresh you.  I was out east, exploring the snow storm hitting Vermont and snowboarding before global warming reasserts itself and sinks us back into another godawful hot summer.  I did tweet, and if you want to follow along with my running mental dialogue, this is the place to do it:

 

The gambling halls in Chicago are currently placing a 1.3% probability on the Fed to drop interest rates by 25 basis points this Wednesday.  Imagine the Fed actually being dumb enough to LOWER interest rates with wonton degeneracy already heating up in the house flipping market.  These are not intelligent bets:

In summary, the upcoming Fed meeting is not a live meeting.  Rates will stay UNCH.  The predictive models prepared and operated here on the RAUL blog expect a calm drift, perhaps with an upward bias—drifting until Wednesday afternoon.  Then we will use third reaction analysis after the rate decision to predict direction into the second half of the week.

IT REALLY IS THAT SIMPLE HAHAHA, YES!

If you want complexity, and confusion, there are lots of chart loving, statistic spouting, podcast jaw-jackin’ accounts for you to spend your precious time on.

YEAH JAW JACKIN’ BEATIN’ IT YEAHHH

If you want simplicity, you can stop by the RAUL blog weekdays around 9am and Sunday afternoon for the absolute minimum amount of communication on how to make money.

RAUL SANTOS – March 17th, 2019

Exodus members, the 226th edition of strategy session is live.  I am slowly warming up to trading bitcoin futures, or perhaps just trading the underlying bitcoin but using the futures trading data to drive decisions.  Keep an eye on Section III.  Also, check out exactly what I expect from the PHLX semiconductor index, for it will likely tell the whole story, even if the broad indices seem murky.

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Some clarity during rollforward week

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

The Fly has been sharing an entertaining video that depicts a rigged market being manipulated by bad actors who are toying with a speculator:

Sadly, many of you actually BELIEVE that major markets,billions of dollars in daily liquidity, and tens of thousands of daily participants are, in fact, rigged.  If this is you, do yourself a favor and stop trading now.

You are going to lose all your money.

Listen, markets do not care how you are positioned.  They are a representation of the net interaction of everyone participating.  Do individual stocks with low liquidity present manipulation risk?  Yes.  Does the NASDAQ 100? No.

If you cannot surrender yourself to the fact that you are completely powerless in affecting the outcome of a liquid market, AND also accept that it is a fair auction that simply exists to facilitate transactions, you will be dealing with some serious mental headwinds while attempting an activity (trading) that requires clarity.

I have been a dick these last few weeks on Twitter.  If someone has a bias different than mine, I have been trying to get into their head and drive errors.  I am going to stop doing it.  Some people will always let their ego run wild.  I really shouldn’t get in the way of them making mistakes anyhow.

It’s the bad side of being hyper-competitive.  I want to destroy people when I need to be more compassionate.

Anyways, the upcoming week is shady.  The March futures contracts are still trading, which skews volume studies.  I will be trading the June contract starting Monday morning.  And my main guide for the upcoming week will be the PHLX semiconductor index.  Last week, in the Strategy Session, I highlighted how it could set up a bear trap. Well, it appears it has.  How we go forward from here will tell the story for the entire stock market:

Position accordingly.

Exodus members, the 225th edition of Strategy Session is live, go check it out!

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Good to be back, model is bullish

I spent a good part of my work day updating my research.  It took longer than it needed to because a task tends to fill the space allotted to it.  The day before I left for a few weeks I managed to accomplish an impressive amount of tasks.  I tied up nearly every loose end in my life.  Why had those things sat, incomplete for so long?  Why was I able to wrap them *all* up in such a short period of time?

These are the things I wonder about.  I am time wealthy. Most of you are very time poor. Being on sound financial footing as a 33 year old without child, you must imagine I am surrounded by many people who are time poor.  Very successful people on paper, running successful businesses, bringing home millions of dollars per year who are very time poor based on their own choices.  Whatever.  Doesn’t matter.  Spending too much time on my stock market research has me worried.

Have I already started to drift back into my slow rut after weeks of roaming free?  The rut has its perks—it keeps me on the right path for trading.  But it also is hard to turn out of, if needed.

Sitting at the main control panel of Mothership for several hours today has been interesting.  My anatomy has changed a bit from two solid weeks of snowboarding.  It does not enjoy my old sitting posture.  These new muscles in my deep core demand stimulation, not this desk loafing atrophy.

I also sense a bit of hubris in my writing that makes me wonder if I will drift away from my trading system in a way that hurts me.

I suppose you don’t need to read through my internal awareness.  You’re hear for headstrong insight into the world of investing and trading.  The model, lads, it’s bullish.  It has sereved as a faithful guide since not avoiding the Q3 market correction.  It has been rock solid since then.  It is bullish.

Therefore I will take to the NASDAQ 100 come Tuesday, and I will be working any down gaps inside the prior day’s range closed with my buy orders.  I will be gunning for the overnight high AND range extension up sometime before lunchtime New York.  I will continue to press my long bets, especially the one’s I have been quietly placing inside Exodus that pertain to a certain eco-friendly industry group.

The only things that can stop me from working my plan are a dramatic negative reaction to the Fed minutes Wednesday afternoon, some sort of geopolitical catastrophe, or my own reckless ego.

Exodus members, of course I still love you.  The 222nd edition of Strategy Session is live.  Sorry to abandon you for a few weeks.  Hope you’ve all been holding up well. My abandonment is a perfect example of why you should develop your own systems.  One day your old pal won’t be around anymore.  Perhaps I’ll move to Wyomah and start herding alpaca.  Who knows.  Anything could happen.

bullish until otherwise stated

RAUL SANTOS, February 18th, 2o19

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Woke blogging gets no play in the fin-twit universe

If you are really good at something, then the peers you are competing against aren’t going to like you.  That’s why I love blogging here on iBankCoin aka the island of fin-twit-misfits, consistently calling it how I see it.  I can be as crass as a keyed up trucker without repercussion from some dick nosed manager/handler.  More often than most I’m right, and the fin-clique can’t share my work because I use boulevard vernacular.

Wannabe traders seem to gravitate towards blogs that cannot forecast—to feel good blogs that shade real life traders who trade and blog about how they trade and forecast.  I forecast, like a horoscope, using set of objective rules to interpret something.  Is it perfect or always correct?  Hardly.  What fun would that be?

Anyways, here’s what I stated before abandoning my post for a few weeks:

Aaaaand here’s what has happened since:

I’m going to be watching this setup closely heading into month-end.  In the meantime, enjoy your favorite list-posting feel good fin-tweeter, for whatever it’s worth.

STRATEGY SESSION UP NEXT.

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How Exodus Strategy Session navigated the v-shaped recovery

I have been out of pocket for a few weeks.  Despite my best attempts to secure WIFI in the arctic lands of British Colombia, I failed.  Subsequently, I have not done my Sunday research in three weeks.  This must have been very nice for my enemies, who didn’t need to compete against a living legend.  But I am back inside mothership and have made the rest of my work day open for research purposes.

While I catch up on recent stock market happenings and use said happenings to form a forecast for the upcoming trading week, here are the old notes from Section III of the strategy session.  I have kept a running dialog since IndexModel fired the “Bunker Buster” signal on December 15th, 2018.  In the following notes, you will see that the systems we utilize to forecast direction stayed on the right side of the recovery.  While we did not avoid the Q3 correction, we did successfully avoid becoming bearish during the bounce, which would have been an all together painful mistake and losing endeavor.

Without further adieu, my research up unto this point:

December 16th, 2018:

The last time IndexModel signaled Bunker Buster was on 04/01/2018.    The other 2018 BB signals were 03/25 and 02/04.  The 03/25 signal and 04/01 signal fired sequentially, ultimately marking swing low for the next six months.  The February signal was successful also, but not for as long a period.

December 23rd, 2018:

The 12/19/2018 BB signal is interesting.  The timing of it into year-end and December OPEX, with the prevailing sentiment calling for a market crash, heading into the last FOMC rate decision of the year, with our contextual NASDAQ Transportation index on the verge of a breakdown, is giving me strong bullish conviction into year-end.  The look bad.  The news cycle is negative.  The holidays are distracting.  These are opportunistic conditions where the competition seems to be collectively leaning the wrong way AND distracted.

With the IndexModel back to neutral [see Section V] and Exodus still in an active hybrid oversold signal [section VII] the models are aligned for upside.

#developing

December 30th, 2018:

Everything expected above was wrong.  Now we have another Bunker Buster.  Two in close sequence has been a trait seen near swing lows historically, therefore I am skeptically bullish.  Extremely skeptical.

THOUGHT FROM FOUR WEEKS AGO:

Signs of swing low emerging.  Lots and lots of people calling it a bear market bounce.  Not many think we can v-shape back up to the highs.  In fact, I have not seen that sentiment expressed anywhere.  The prevailing sentiment is to initiate shorts into this ‘bear market rally’.

We are in yet another active Exodus hybrid oversold cycle (triggered Christmas eve) and IndexModel is neutral.  These conditions, per my 215 weeks of tracking Exodus and IndexModel statistics, favor upside.

#cautiouslybullish

January 6th, 2019:

With Exodus going hybrid overbought on Friday and the behavior of the industry performance (Section II) I am becoming more confident in the bullish case.  I expect price to work higher at an increasing velocity in the coming week.

January 13th, 2019:

The e(RCS) signal from IndexModel gives an interesting layer of context to our current recovery.  The signal has often precluded weeks where price simply drifts sideways.  With our key contextual index, the PHLX semiconductor index, coming into old support (which is likely to behave as resistance now), it makes sense to see a pause in upward action.  However, if price simply corrects by trading sideways (a time-based correction) as opposed to a return of volatility and downward selling pressure, that will bode especially well for a continued recovery.

January 20th, 2019:

Holiday shortened week, monthly OPEX out of the way, index model calling for a calm drift via the Extreme Rose Colored sunglasses signal, no major tech earnings scheduled—with these contextual pieces aligned, my primary expectation is for continued price stabilization, perhaps not as strong of movement to the upside as we saw during the week of 01/13 – 01/18 (last week).

January 27th, 2019:

Tons to digest and this is likely to accelerate the movement of prices.  But I expect little to be accomplished.  IndexModel is still showing extreme Rose Colored Sunglasses which signals an expected drift perhaps with a slight upward bias.

***

RAUL here.  I am going to be back later on this President’s day with fresh findings.  Stay tuned.  My spirit is envigorated after spending weeks underneath the largest atmospheric river North America has even seen in my 33 years on earth.  This freshness, paired with my desire to fuck up all these bush league fin-twitter personalities has me quite optimistic in my findings.

#developing

If you want some extracurricular activity, here is my blog entry from December 30th, where I first suggested a v-shape recovery was likely.

okay, now I go to work, ciao ciao kiss kiss

 

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