Was surprised this morning to see that we are already heading into the final full week of March. Options have expired, the sun is out, and I am still bogged by this kitchen remodel.

The only work I am contracting out is the counters. The installer scheduled himself to come out Tuesday and take measurements and then he’s running two-to-three weeks out. Yep. I cannot install the back splash, range hood, upper shelving until then. I haven’t had a kitchen sink for nearly three weeks and it is going to be three more until I do. Same with the dishwasher. I have no idea how people live long-term without a dishwasher.

So much of my strength and ability to help others comes from my kitchen. Even when I am trading, I often place my trades, work to neutralize the risk on a position, then head into the kitchen to let my runners work while I monitor from a distance, via the 70-inch sammy, whislt listening to tunes and frolicking to-and-fro from the garden to the kitchen. Making tasty health foods, the real medicine of the good life, for myself and familia.

The kitchen is where I consult weary travelers and apply salves. It is where I do much of my reading and writing. It is so essential to everything I do.

Now I’ve been ‘work-from-home’ for nearly nine years. What has been new to many of you is modus oporandi over here. I’ve been developing Mothership as a place of business this entire time. I usually have every inch dialed in and could tell you from memory where anything (ANYTHING) is. Losing the kitchen has been eye-opening. So many of my projects are off the rails. I can hardly remember to pay my bills on time.

Thankfully I have my office. I’ve managed to put down some good trades. Good enough to keep the lights on and pay for all the dang carry-out I’ve been eating.

The Mothership updates are likely to elevate my game to a new level. Along with the kitchen modifications I have big plans for the fields this years. I’ve expanded my working land significantly. I have three different non-gmo corn strains I am working with this year along with a variety of other foods. But the big show for me is corn. Being of Italian decent, I am the first of my people to take corn seriously. They’re too busy growing pomodori and basillico and frijolis. For whatever reason, they never made the leap to american agriculture aka corn babay. But look at me. I am the captain now. The elders are taking it easy these days and rightfully so. They’ve earned it. They’ve built more in the last 50 years that most of yous could ever dream. They are TIREDT. Not me. I shall take the reigns and continue our legacy.

Moral of the story? If your clan has been in america for more than 50 years and you are the patriarch, and you’re not holding shit down, sewing the land and operating a state-of-the-art kitchen to keep yourself and your family as happy and healthy as possible, you are going to fall behind those of us with the immigrant hustle embedded in our bones.

Okay back to work.

I am bullish heading into March. Time to do nothing with the accounts. They should have been added to back on the Bunker Buster. I am the captain now.

Raul Santos, March 21st, 2021

And now the Strategy Session. Be sure to check out the notes about concentrated money flows. They are telling a story.

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Stocklabs Strategy Session: 03/22/21 – 03/26/21

I. Executive Summary

Raul’s bias score 2.95, neutral. Powell works price higher through Wednesday, then look for third reaction to GDP and jobless claims data due out Thursday morning to provide direction into the second half of the week.

Major NASDAQ component Adobe Inc. is set to report earnings Tuesday, after market close.

II. RECAP OF THE ACTION

Choppy. Buyers drove higher through Tuesday. Wednesday markets gapped down then marked time until The FOMC announcement then shot higher. Thursday through Friday morning saw sellers erasing the Fed move. Then buyers resumed control into the weekend with a mellow rotation higher.

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

Rotational Report:

Energy slammed lower and continues to trade independent of the rest of the market. Otherwise mild sell rotations across the board. Slight green shoots from Healthcare and Staples.

slightly bearish

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

Concentrated Money Flows:

Don’t forget the major buy flows two weeks back. We have not seen any follow through on them yet, nor have we seen any selling of a magnitude that would expect us to doubt upside follow through.

Check out last week’s flows — most of the selling was seen in energy industry groups which we’ve already established trade independent of the overall market.

Median return on the week was right around -1% and volume delta over the last 30 days is essentially flat.

Money flows are slightly bullish.

Here are this week’s results:

III. Stocklabs ACADEMY

Three month oversold signal is useful

On Thursday, March 18 Stocklabs flagged oversold on the 3-month technical and hybrid signals. You may notice I never include any 3-month signals in the Weekly Strategy Session, but lately I’ve been giving it more consideration.

There are two bits of data from the 3-month oversold signals that are slightly better than 50/50 odds. The 5-day return on both Tech and Hybrid is around a 58% win rate with an average return of about 25 basis points. And the 10-day return of the hybrid algo. It has a 59.26% win rate with an average return of around 33 basis points.

This is useful, especially since we can draw statistical significance from the 10-year back test due to having at least 50 samples.

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:

Powell works price higher through Wednesday, then look for third reaction to GDP and jobless claims data due out Thursday morning to provide direction into the second half of the 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]:

Semiconductors still show balance, Transports could launch

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 clearly are in a continued discovery up phase. We can see how steep the ascent is. This is likely, at some point, to resolve with a sharp move in either direction to break from the wedge. My primary expectation is for a blow off buy move higher, but the break could just as well happen to the downside. For now, discovery up continues and is bullish.

See below:

Semiconductors have a head-and-shoulders pattern printed but more importantly we have a clear range to work with. Balance is the call until one of these edges cleanly breaks.

See below:

V. INDEX MODEL

Bias model is neutral for a third week after signaling Bunker Buster three weeks ago and being neutral for the thirteen weeks prior to that. No bias heading into next week. Here is the current spread:

VI. QUOTE OF THE WEEK:

“Of course I deprecate war, but if it is brought to my door the bringer will find me at home.” – James A. Garfield

Trade simple, be ready

Comments »

Lads one thing I’ve always loved about being an index futures trader is the quarterly nature of our dear derivatives. Last Thursday most active traders rolled forward from the March contract to the June. I always wait until the weekend to do so, even if I am actively participating, which I most certainly was not last week. But I’ve spent the better part of this morning refreshing and rebuilding my charts for the June contract which inevitably leads to warm thoughts.

Try as I may to finish installing a new kitchen at Mothership quick enough to hightail it west for one last romp in the snow, that likelihood decreases with every passing week.

Sometimes the project seems to be moving along nicely. Other times I go to move a plug and make a real horror show of a mess of the drywall. I am not handy. I come from a long line of builders but I build out of necessity not passion. My passion is gardening and earth keeping and gathering natural resources.

Now I may be just a humble speculator, by trade, but I don’t let the challenges of installing a kitchen get me down. If I can understand high level physics books then I can most certainly install tile and plumbing. Moving water is one of my specialties, waste or otherwise.

And while I’d rather be building fountains I want a big ass farm sink for processing all the dang food I grow. So here we are.

The upcoming week is likely to be full of shenanigans. There is a FOMC annocement. The gambling halls down in Chicago are placing one hundred prercent odds that the Fed will leave the benchmark borrowing rate unchanged a 0-0.25%. There is still likely to be an EKG burst reaction around 2pm Wednesday. And as participants digest the language coming out of Powell’s Fed during the 2:30pm presser, we ought to gain a decent idea where the market is headed into the second half of the week.

What most of my peers don’t seem to realize is my approach to trading allows me to make 600-900 fiat american dollars real quick. And I do that a few times a week. I don’t glue myself to the terminal, addicted, going after trade-after-trade-after-traded. That is no way to live. I secure the bag then I go and enjoy life. If I cannot see all the stars aligned for me to become active, it makes money, long term, for me to do anything other than trade. Literally sitting completely still, in the yard, listening to birds, makes me more profitable than engaging my edge all the heckin’ time.

I never took up speculation for the sake of speculation. It was a means to a lifestyle I desired—one where I am free to do as I please. No one’s master. No one’s slave. Cooking tasty food. Swimming. Drinking hootch and being the rock of my familia. That’s it.

So while there is always the opportunity to go after more.MORE.MOAR…I ask myself, “at what cost?” Right now I work too hardt. This heckin’ kitchen has me stressin’. And if it’s not wrapped up by about April 20th, then it’s going to start to infringe on my outside work. My passion.

We cannot have this.

Therefore I must focus on making incremental progress on the Mothership kitchen even if it means falling behind on my speculative finance work. I do not apologize if this leaves any of you hanging.

I’ve never promised to feed any of you fish. At my best, I am a resource for generating your own ideas on how to fish. That way, when I am gone, you don’t cease up. Psychologically you are unchanged and you make your way just fine, emotionally convinced that you can handle your own self business.

At my worst I am just a heckin’ distraction.

I will likely find time to trade the opens most days this week. But my screen time will remain limited until this dang kitchen is back operational.

Raul Santos, March 14th (Pi Day!), 2021

And now the 329th edition of Strategy Session. Enjoy:

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Stocklabs Strategy Session: 03/15/21 – 03/19/21

I. Executive Summary

Raul’s bias score 3.58, medium bull. Continued upward momentum early in the week. Then look for third reaction to the FOMC announcement Wednesday afternoon to dictate direction into the second half of OPEX week.

II. RECAP OF THE ACTION

Buyers in control all week long everywhere except the NASDAQ. The NASDAQ saw a hard sell Monday then sort of chopped higher for the rest of the week.

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

Rotational Report:

Rotations higher across the board. Slightly risk averse to see Utilities as the second best performers. The lagging Tech sector also not suggesting a clear bullish week ahead.

neutral

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

Concentrated Money Flows:

Industry flows were heavily buy side, performance wide. Nearly seven pages of industries with returns over +3%. Median return was an impressive 5.74% while 30 day volume delta skewed negative, perhaps due to accounting for the recent sell off several weeks back.

bullish

Here are this week’s results:

III. Stocklabs ACADEMY

No signals

Scanning through the various OBOS signals for the Stocklabs algo quickly reveals we have no statistical backing from the software heading into the week that we can use to form a bias. Nothing from IndexModel either. Therefore being neutral, the focus is on only taking high quality trade set-ups and only for scalps. No reason to press winners in this environment.

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:

Continued upward momentum early in the week. Then look for third reaction to the FOMC announcement Wednesday afternoon to dictate direction into the second half of OPEX 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]:

Semiconductors come into a choppy 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, 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 in a clear discovery up phase.

See below:

Semiconductors appear to be in a choppy range. The Fibonacci retracements above and below current prices are broad areas where I expect price to bracket and work sideways.

See below:

V. INDEX MODEL

Bias model is neutral for a second week after signaling Bunker Buster two weeks ago and being neutral for the thirteen weeks prior to that. No bias heading into next week. Here is the current spread:

VI. QUOTE OF THE WEEK:

“All cruelty springs from weakness.” – Seneca

Trade simple, be kind

Comments »

Good evening lads,

I took a break from installing the kitchen from hell, jackin’ off and all the other deviant things I do to update the weekend research and here we are. There was a bunker buster last week. Yup. Sure was. There is something to be said about being prepared for a price acceleration…so I shall. In the past I’ve taken to the futures market during a bunker buster week and I would start out only working the short side of the tape, then eventually I would switch and only work the long side. The challenge was often times the bunker can bust right off the get go Monday morning.

In fact, I thought that might have been the case last week. Right on the open Monday the NYSE TICK went third sigma up. Thems are ‘go with’ ticks. I had to resist with every fiber the base impulse to sit down and start ripping long /nq trades. Instead, I stayed in my nightmare kitchen, brooding about the next time I could jack off, and from my mobile phone I placed buy orders for GOOGL and TACO and something else. I dunno exactly which tickers. It doesn’t really matter. Wednesday I did it again TWTR and TACO and something else, and Friday a third time COST and TACO and AMZN.

Expecting selling, I was patient and had my little shopping list like I was going to Costco to stock up on supplies for the old jack shack and I just checked the names off the list then walked past the dollar fifty hot dogs and went back to the empty box that once was a kitchen.

I eat from one bowl, no matter what the food and I use the grey water from my laundry to worsh it rinsed. I drink municipal water from a mason jar I fill from the sink next to the toilet.  This is also where I shit and make coffee.

In summary, I have reduced Mothership to Cruise America RV living conditions and morale is sort of…idk…off.

In any event, physically I am strong as an ox. I can literally rip cabinets off the walls with my bear (bare?) hands. Performance wise, doing okay. Next week? We don’t know. One bite at a time.

Raul Santos, March 7th, 2021

And now the 328th edition of Strategy Session. Enjoy:

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Stocklabs Strategy Session: 03/08/21 – 03/12/21

I. Executive Summary

Raul’s bias score 2.95, neutral. Sellers assert some pressure on prices early in the week before a choppy second half of the week.

II. RECAP OF THE ACTION

Third sigma NYSE TICK on the open Monday, kicking the month off with a full day of conviction buying. Tuesday erases much of the Monday gains then a sharp trend lower through to mid-Friday. Markets turn around late Friday and rally into the close.

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

Rotational Report:

Rotations mostly higher. Energy continues to trade on its own planet. Concerning divergent weakness from key Tech and Discretionary sectors.

neutral

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

Concentrated Money Flows:

Industry flows slightly skewed to the sell side of the ledger, but not by much. Volume delta well over +5% suggests buyers were more aggressive with their orders. Median return a bit below +0.5%.

neutral

Here are this week’s results:

III. Stocklabs ACADEMY

The week after a Bunker Buster

So the Bunker Buster managed to forecast the selling. The IndexModel does a decent job of providing a good explanation “why” the market does what it does. We look at raw data generated by the net interactions of all market participants. No headlines. No gurus. Not the moon. Just orders.

The tendency after the model successfully forecasts behavior is to become aggressive. Well, heading into this week we have no IndexModel to work with. The model is neutral. Stocklabs is neutral. There is nothing to work with.

Hopefully we used last week’s selling to accumulate larger positions in our favorite long term investments. If we executed that part of our strategy well then this upcoming week is the time to do nothing.

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:

Sellers assert some pressure on prices early in the week before a choppy second half of the 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]:

Possible signs of 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, 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 saw buyers form a sharp excess low. This could be the early set-up for a new balance.

See below:

Semiconductors also formed an excess low, right around the breakout zone from a prior consolidation. Primary expectation is for a new range to take hold.

See below:

V. INDEX MODEL

Bias model is neutral after signaling Bunker Buster last week and being neutral for the thirteen weeks prior. No bias heading into next week. Here is the current spread:

VI. QUOTE OF THE WEEK:

“A journey of a thousand miles begins with a single step.” – Lao Tzu

Trade simple, this trade now, then the next

Comments »

I read a beautiful tweet this morning:

Did shrooms
With my wife
Saw a vision
Came up with a billion dollar idea
Manifesting under a full moon
I love my life

— No 🔑 No 🧀 (@bitcoinzay) February 28, 2021

And whether or not this nice man came up with a billion dollar idea, we don’t know. It doesn’t matter. I know well the feeling behind the message and that he was brave enough and has a strong enough relationship with his wife to take psychedelics together is a wonderful thing.

Set and setting are so very important when you take these chemicals. Self-awareness skyrockets when we introduce these compounds to our body. The mushrooms show you what you need to see. Most of us have some goblins hiding out in our psyche, wrong doings, whatever, which is fine, however confronting those spooky things around the wrong people and/or in the wrong place is a recipe for a bad time.

You know, running down the street naked, rolling around in gutter puddles, stuff like that. No bueno.

I spend a good deal of my time building places I feel safe going on a trip. You would not believe how difficult it is to create total outdoor privacy. Pure, garden of eden style, nudity without the risk of offense, writhing around on the ground asking the gods why, why, WHYYYY? outdoor privacy. Ask me how I know.

There are a few ways. The first and least labor intensive is go to a national forest and hike at least a half day into the wild then venture off any beaten path. You will find, however, that it is extremely difficult to get away from humans. They. Are. Everywhere. Again. Ask me how I know.

Next you can build privacy. But don’t assume a six foot wooden fence will do it. It won’t. Don’t assume 20 acres of land will do it. It won’t. Some fucker always has the higher ground. I work hard in this department.

You need to become one hell of a gardener. In the north, emerald green arborvitaes are your friend. They need lots of space though, more then you might give them if you’re impatient and want privacy NOW. I recommend planting two rows of them in a checkerboard formation. So with a six foot wooden fence and about $5,000 fiat american dollar’s worth of arborvitae stock you are well on your way to creating total visual privacy. Guess what? You still need to create audible privacy.

You would not believe how fucking god damned nosy people can be when you start howling like a wolf. You’re going to need to build some fountains. Big ones. You really need lots of white noise if you’re a moaner.

Okay now the third way: obtain the high ground. This works well especially in the city where there is all sorts of other noises. Climb or otherwise gain access to the tallest building in sight. Bring a couple snacks, some forty ounce bottles of malt liquor and the psychedelic of choice. Make sure you have the mental fortitude not to lose your head up at those heights. I recommend a faithful companion.

The fourth way is a totally different set of circumstances and will result in a totally different experience. Which is fine. And can be wonderful — go to a massive gathering of freaks (rave, masquerade, festival) and sort of just go with the flow. Blend in with the wookies. Experience the deep interconnection to your fellow humans. Beware though. They may gross you out at some point—what with all their gluttony and pores….their pores…and their stimulant impulses.

So yeah man there you go. Those are a few ways to set up for a nice trip.

BACK TO MARKETS: We have a signal to work with from the IndexModel. The first one in thirteen weeks. Hallelujah. Bunker Buster. This is a wild signal. It calls for an acceleration to the downside which eventually leads to a low that can last for weeks. Months even.

And we’re heading into March. And the moon is big. And last week we had all that spooky numerology guff going on (3.33 on 02/21/21).

I do not day trade during Bunker Buster signals. But I do accumulate/add to long term investments. Therefore I will use the week to buy more TACO, TWTR, TSLA, FAMI, GOOGL and so on.

I will likely put out morning reports still. Or just tweet out my levels. Either way thank you for stopping by and just know I am looking for fast selling to buy into.

Okay for now.

Raul Santos, February 28th 2021

And now the 327th edition of Strategy Session. Enjoy:

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Stocklabs Strategy Session: 03/01/21 – 03/05/21

I. Executive Summary

Raul’s bias score 2.55, medium bear*. Selling velocity increases to the downside, ultimately forming a sharp, excess low that holds for the rest of the week. Third reaction to Non-farm payroll data Friday morning sets direction heading into the end of the week.

*Bunker Buster signal triggered, see Sections III and IV.

II. RECAP OF THE ACTION

Pro gap down into the week. Sellers control the tape through early Tuesday. Buyers strong Tuesday and erase Wednesday’s down gap. Strong selling Thursday. Choppy Friday, chopping along the weekly lows.

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

Rotational Report:

Rotations uniformly lower except for energy which continues to trade independent of other sectors.

slightly bearish

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

Concentrated Money Flows:

Industry flows skewed heavily to the downside last week. Median return nearly -2% but not quite. The median 30-day volume delta remains negative suggesting a continued outflow of capital from the equity complex.

bearish

Here are this week’s results:

III. Stocklabs ACADEMY

Bunker Buster

This is the first bunker buster signal of 2021. There were four bunker busters in 2020 (2/2, 3/22, 6/28, 11/1). This signal is bullish, in a sense, but has been hard for me to use to my advantage in my day trading. I have however found it to be a useful time to accumulate additional long-term investments.

Therefore I will use the upcoming week to add to my favorite investments of 2021, especially into any fast selling. The key is to wait for responsive buyers to emerge. This will look like a sharp, fast bounce off the lows. It could come as soon as Monday morning.

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:

Pro gap down into the week. Sellers control the tape through early Tuesday. Buyers strong Tuesday and erase Wednesday’s down gap. Strong selling Thursday. Choppy Friday, chopping along the weekly lows.

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]:

Semiconductors wearing out support zone

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 still look to be in discovery up. Primary expectation is for a continued up phase.

bullish

See below:

Semiconductors have pressed into their local support level hard three times. The more times a support level is tested, the weaker it becomes. This could lead to a fresh leg lower. This general drawn box envisions where a new balance may form along the highs.

Or we could switch right into discovery down.

Or the support holds and discover up continues.

All this to say the key semiconductor index is looking uncertain heading into March.

neutral

See below:

V. INDEX MODEL

Bias model is signaling bunker buster after thirteen consecutive weeks of neutral readings. This signal calls for an acceleration to the downside that ultimately discovers a tradable low.

VI. Stocklabs Hybrid Overbought.

On Friday, February 5^th Exodus flagged hybrid (and technical) overbought on the 12-month algo. This is a bullish cycle that ran through Monday, February 22nd end-of-day. Here is the final performance:

VII. QUOTE OF THE WEEK:

“Three things cannot be long hidden: the sun, the moon, and the truth.” – Buddha

Trade simple, be patient

 

 

Comments »

I come from a long line of angry men. It is no excuse. I can do better. So many of the ways I usually channel all this physical rage vibrating in my body are gone from my life. The weights. The pools. The all-night raves. The 120 degree yoga rooms. Digging holes.

I’ve been on the computer since 8am after I triggered on some nice feller from Ohio after he dunked on me over on the Twitter. I felt like a real dumbass after that.

Anyhow I did all the weekend research. I am pretty spent, intellectually. I wish I could go empty my physical tank in the same manner.

Exercising at home is not the same. The great outdoors of Detroit are flat and bleak. Maybe I’ve just rip the damn cabinets off the walls.

It took five months to get everything I need for a new kitchen. It’s all sitting in the garage of Mothership. Should be pretty bitchin’ when it’s done.

Anyhow. Yeah. I need brainless work.

We slayed the NASDAQ last week. It took way too long maybe that has me ornery also. I sort of chopped wood Wednesday through early Friday. Then had to stick around all heckin’ day Friday to finally capture the move up to 13,800. I know, first world problems.

I’m telling you—I need to be hooked to a plow and made to work the land. Otherwise I end up a dull boy.

Happy Valentine’s Day.

Raul Santos, February 14th, 2021

And now the 325th edition of Strategy Session. Enjoy:

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Stocklabs Strategy Session: 02/15/21 – 02/19/21

I. Executive Summary

Raul’s bias score 3.58, medium bull. Prices work higher Tuesday and through to Wednesday afternoon. Then look for the third reaction to Wednesday afternoon’s FOMC minutes to dictate direction into the second half of the week.

Wal-Mart reports earnings Thursday before-market-open. This major retailer/employer’s earnings could turn the whole market.

U.S. markets will be close Monday in observation of President’s Day.

II. RECAP OF THE ACTION

Gap up and slow rally through Tuesday. Fast selling Wednesday morning ultimately erased by early Thursday. Choppy along the highs until a late Friday ramp higher.

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

Rotational Report:

Mixed rotations, predominantly higher. Tech strong but discretionary soft. Risk tolerance remains elevated.

slightly bullish

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

Concentrated Money Flows:

Industry flows not quite as heavily skewed as last week’s report, but still skewed bullish. Median return up over +2% after being greater than +4% the week prior. Key semiconductor industry groups populating the positive side of the ledger. No industry has a median return below -3%.

bullish

Here are this week’s results:

III. Stocklabs ACADEMY

No news is good news

The News tool inside Stocklabs can be especially powerful when a position I own makes an abnormal move. One of my favorite themes of this decade is the movement away from consuming animal flesh. Beyond the obvious technology plays like $BYND is mushrooms.

One of my long term holdings, Farmmi INC (ticker FAMI) saw its price move +40% last week. I like to know if a re-pricing of this scale is due to new information becoming public or a simple supply/demand based discovery process because it tells me how to treat the behavior.

A news driven move I will be skeptical of. I need to dig into any releases and check sources, and determine whether there is merit to the move. Then, my most likely expectation is for price to “return to the scene of the crime” meaning check back to the prices before the move happened.

I am quickly able to determine no news is associated with the movement by screening the News feed inside Stocklabs for “Farmmi”. Notice: If I attempt to screen using the ticker symbol a ton of useless noise feeds in because the software cannot differentiate between FAMI and “family”.

Knowing how to query large data sets is one of the skills most millennials take for granted. However, done correctly, on Google or in Stocklabs or elsewhere, and the world is your oyster.

There is no news behind the big move in Farmmi, therefore I shall continue to maintain my holding and perhaps add to it.

Due diligence complete in two minutes using the Stocklabs News tool.

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:

Prices work higher Tuesday and through to Wednesday afternoon. Then look for the third reaction to Wednesday afternoon’s FOMC minutes to dictate direction into the second half of the week.

Wal-Mart reports earnings Thursday before-market-open. This major retailer/employer’s earnings could turn the whole market.

U.S. markets will be close 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:

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

All systems are up

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 continued their discovery up phase.

bullish

See below:

Semiconductors broke higher out of a mini balance on news of a chip shortage. Discovery up.

bullish

See below:

V. INDEX MODEL

Bias model is neutral for an twelfth consecutive week. No bias.

VI. Stocklabs Hybrid Overbought.

On Friday, February 5^th Exodus flagged hybrid (and technical) overbought on the 12-month algo. This is a bullish cycle that runs through Friday, February 19^th end-of-day. Here is the performance thus far:

VII. QUOTE OF THE WEEK:

“If there is no struggle, there is no progress.” – Frederick Douglass

Trade simple, challenge your research

 

Comments »

I suspect this entry will be overlooked for the most part, what with the NFL, or rather Tom Brady, putting on one of the best shows in the world today, but alas, I am back from the mountains lads. My research is caught up. I feel ready to re-engage the speculative financial markets.

And daddy we have some good signals heading into the week that’ll have me working the long side of the tape until I say otherwise.

There is nothing more empowering than a set of tools to consistently help reset the footing and mind of a hardened speculator. I spent the last twelve days or so drinking hootch and careening down rocky cliffs with a board strapped to my feet. In my downtime I’d shitpost on Twitter about doge and other internet culture that most of these fintwit dopes seem to be unable to grasp.

Let’s have an aside for a moment, shall we? And discuss why doge coin is working…

If you were around back in 2017 during the first big run in bitcoin then maybe you remember what it was like to see something mysterious and detached from the traditional financial markets skyrocket in value. However, you had to be in Miami beach during Art Basel to fully appreciate the reality of it.

I am telling you…it made the madness of the human mind visceral.

That Saturday night, the first weekend of the festival, at the Fontainebleau (no Impala) was the most absurd display of influencer wealth I have ever seen in my life. I am telling you, it was shocking. Dozens, I am not exaggerating, DOZENS, like at least thirty, of Lamborghini cars DEFACED with wretched paint jobs…made to look like Mario Cart toys, emblazoned with Bitcoin symbology. Amongst other things.

Women I’ve never heard of nor cared to know, dressed like cheetahs, followed by no less than five helpers all pointing cellphone cameras and flashlights at them.

Asian dudes, on laptops, with thousand dollar bottles of champaign next to them, rapidly trading YES TRADING LIVE, big denominations, while the thump of club music pulsed through the air.

Basketball players, b-list celebrities, money like you’ve never seen on display.

A real horror show and I loved it. I saw this little model of a dumpster—created with excruciating attention to detail, no bigger than a shoe box, sell for $5,000.

I was so tickled by it all I had to learn more. I had a tiny platform back in Detroit, a town that has a strange connection to Miami. I am the organizer of the Stocktwits meet-up group up here and I started calling meetings. Giving presentations and listening to anyone who bothered to show up. This is when I met real blockchain folks.

These were not the flashy kind from Miami. These were hunkered down discrete types, speaking about revolution, about upheval of the whole financial system. On their coattails, the most corporate, douche baggy, privacy stealing organizations on the planet.

What a shit show…

Anyhow this is right around when all these shit coins started materializing. With a few simple keystrokes, White Papers were formed and suddenly every dickhead had their own cryptocurrency.

It really tarnished bitcoin and CRYPTO WINTER ensued.

I kept faith in bitcoin. I accumulated it for the next several years. I also accumulated bitcoin cash and bitcoin gold because I had no idea what any of it meant. I accumulated ethereum as well because, and I shit you not this is how simple I keep things…it had a cool name.

Some of the local blockchain heads talked me into buying EOS also. But it was all above my head and that’s when I sort of had enough of it all.

But then there was DOGE.

Less than a single fiat penny each, this was a coin that had a lovable dog on it. I knew it was the type of thing the internet could make work.

And we’ve come full circle to me shitposting on Twitter when not snowboarding. Memes are what control the collective consciousness of earth.

This has been the case forever. Why do you think the Christians became so powerful? That fucking image of a cross. One of the most powerful memes of all time.

Dogs and cats do really well on the internet. A doge coin will do really well in today’s society.

This isn’t rocket science people.

Now I may be just a simple speculator, but I hope, that during my tenure here at iBankCoin I have demonstrated, live, more than anyone, what the ingredients are for being a strong investor. We invest in people and we invest in religions. That’s it.

The people must be sexy, like Daddy Elon or Noble Jack. The religions must be drastic, like bitcoin and now doge. Sure, there are situation where we invest in other stuff, like my call on oil back in April. When the financial markets throw the baby out with the bathwater we have to be there to eat the baby. That’s just how nature works. Then, since we knew Biden would win and how most people will fuck up and invest in solar going into a Democratic president and how the market rarely rewards common sense thinking, we stayed bullish on oil and continue to be bullish on oil. But these situational things are not the type of investments that change our life. People, sexy people change our lives. So do religions. These are the types of investments we need to constantly seek out. Then we accumulate and think. And fast. And wait.

They don’t come around often.

Anyhow, enough of that, there is a Super Bowl to watch. That handsome lad with the nice hair is attempting to do the impossible, be old and win. Beware an old tiger sensing his last fight.

Raul Santos, February 7th, 2021

And now the 324th edition of Strategy Session. Enjoy:

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Stocklabs Strategy Session: 02/08/21 – 02/12/21

I. Executive Summary

Raul’s bias score 3.85, medium bull. Stocks are flat-to-lower early in the week. Then look for price to rally higher into the end of the week. Watch for third reaction to Fed Chairman Powell’s Wednesday afternoon speaking to dictate the move into the second half of the week.

II. RECAP OF THE ACTION

Gap up to begin the week then a conviction buying range Monday. Pro gap up into Tuesday and move conviction buying. Some consolidation through early Thursday, then a continuation of the rally through Thursday and Friday.

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

Rotational Report:

Broad rotation higher. Energy leading but as always trading independently. Utilities and Staples lagging behind, along with healthcare.

bullish

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

Concentrated Money Flows:

Industry flows skewed heavily to the positive side of the ledger. Median industry return on the week well over 4%.

bullish

Here are this week’s results:

III. Stocklabs ACADEMY

Industry analysis

This week the way I analyze money flows between industries finally migrated away from Exodus. I figured out a way to use Stocklabs instead and I like the results. What makes Stocklabs so powerful is the ability to tailor the tools to fit different trading styles.

I trade NASDAQ futures, primarily during the opening bell. A major component of my strategy is formulating a directional bias heading into the week. I need objective means of doing this. Having a highly customizable industry analysis is a powerful way to aid this process. I can see which industries are having abnormal returns, what the market caps of these industries are. This gives me a sense of the “quality” of what is moving higher and lower.

I then codify this information on a sliding scale: bearish, slightly bearish, neutral, slightly bullish, bullish.

As I do this, over time, I gain even more objective information about my process and the results it produces.

Armed with these types of tools I build confidence in my independent analysis of the speculative financial markets. Even if I have losses on a week, I know there is information to gain and a continued path forward.

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:

Stocks are flat-to-lower early in the week. Then look for price to rally higher into the end of the week. Watch for third reaction to Fed Chairman Powell’s Wednesday afternoon speaking to dictate the move into the second half of the 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]:

Transports in the driver seat

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 rallied hard last week after giving up a price zone we expected to behave as support two weeks prior. When I last reported two weeks back, we expected the recent breached resistance (12/9ish highs) to be converted into support. Instead sellers cut a bit deeper, working back down to the old range high that held as resistance for years.

That level was strong support however, and the reflexive rally off of us reveals a ton of information. UPS earnings also helped the case. The package delivery company posted record profits last week and rallied more than +4% on the week.

All these things considered, while we may be forming an early range/balance, what is more likely is that Transports are in a discovery up phase.

bullish

See below:

Semiconductors behaving quite methodically. This is an extremely extended index, yet it found support at the logical Fibonacci retracement level around 2875. Keep an eye on that level as price consolidated up here along the highs The longer price can work sideways, the better the case for bulls. However, a reversal off the highs could likely start with capturing the 2875 level and holding price below it.

A move lower like that could set off selling across the broad market.

For now…balance.

slightly bullish

See below:

V. INDEX MODEL

Bias model is neutral for an eleventh consecutive week. No bias.

VI. Stocklabs Hybrid Overbought.

On Friday, February 5^th Exodus flagged hybrid (and technical) overbought on the 12-month algo. This is a bullish cycle that runs through Friday, February 19^th end-of-day.

VII. QUOTE OF THE WEEK:

“The most difficult thing is the decision to act, the rest is merely tenacity.” – Amelia Earhart

Trade simple, trade the plan

 

Comments »

Here is an anecdote about Gamestop that may not have any value, but I want to air it out regardless.

Nephew Raul is 13 now, but two years ago I asked him what he wanted for his birthday. He said, “an Ironman helmet.” I was like, “Where do I even buy something like that?” And he said, without hesitation, “Gamestop.”

I was stunned. Here I thought Gamestop was just like some kind of video game store but apparently my young nephew was buying durable goods there.

Anyhow stuff like that always makes a nerve tingle in the speculator quadrant of my mortal flesh. And usually I do some research then act upon it. But that time I didn’t. I just went to Gamestop and bought him the helmet and moved on with my life. Good uncle, shitty speculator. Selah.

The lesson? When the yoots [sic] speak confidently about publicly traded companies, hunker down and make a serious decision about allocating capital.

Now I would have been two years early to the party. Would I have continued to hold into last week’s feeding frenzy?

We don’t know.

I don’t dwell in those sort of ‘what ifs’ however, because I am too busy working hardt on the next big thing.

Do I have a next big thing right now? Sort of. But my highest conviction investment going into 2021 is heckin’ Del Taco. Not exactly earth rattling stuff. I am working on a big land deal, and boy is it taking forever, but let’s stick to the matter of extracting fiat american from the world of speculative public markets, shall we?

Most of us had big Januarys. Making lots of moneys. Either ‘on paper’ or IRL. Now what? January will be done after this week. Is it our intention to continue pressing into these markets, milking them like coked up robots? Or can we be grateful for our early gains and just like go live a little?

I think you know my answer. I shall be taking my gains and heading to the mountains to spend them on fancy airBNBs, big meals and mountain nature fun. I am going to be off the grid for a while, so this entry will serve as a final logging of my thoughts for a bit. Feel free to leave a comment about your favorite way to spend fiat american. In the meantime, wish me luck as I head into the great snowy peaks of the west.

Raul Santos, January 24th, 2021

And here is my final research report for now. The 322nd edition. Enjoy:

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Stocklabs Strategy Session: 01/25/21 – 01/29/21

I. Executive Summary

Raul’s bias score 3.55, medium bull. Equity markets hold the highs, trading sideways, perhaps with a slight upward bias. Then look for price to pivot Wednesday afternoon after the Powell conference.

Be aware of major tech earnings: Microsoft Tuesday after market close, Apple, Tesla and Facebook Wednesday after market close.

II. RECAP OF THE ACTION

Gap and go higher Tuesday into the holiday shortened week. Pro gap up Wednesday is bid higher. Tech heavy NASDSAQ leading while the Russell lagged.

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

Rotational Report:

After two weeks of lagging behind, Tech makes a big move out in front, leading the market higher. Flanked by the quality Discretionary sector. Everything else sort of lower.

bullish

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

Concentrated Money Flows:

Industry flows skewed a bit to the positive side of the ledger.

slightly bullish

Here are this week’s results:

III. Stocklabs ACADEMY

Customized screens

Inside Stocklabs every screen has the ability to be customized. Look for the blue plus symbol (+) any time you see a list of stocks, industries, or anything else. Clicking this symbol opens a window that allows for customization of the page.

For example, I modify the Industry page to show me the one week return instead of the default daily return, and add in breadth readings along with volume delta.

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:

Equity markets hold the highs, trading sideways, perhaps with a slight upward bias. Then look for price to pivot Wednesday afternoon after the Powell conference.

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]:

Transports attempt a favorite market pastime

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 appear to be converting old resistance into support. This level is likely to hold and lead to a new high. If not, a quick trip back into the old balance zone could catch the markets by surprise.

bullish

See below:

Semiconductors continue to discover higher prices.

bullish

See below:

V. INDEX MODEL

Bias model is neutral for a ninth consecutive week. No bias.

VI. Stocklabs Hybrid Overbought.

On Thursday, January 7^th Stocklabs flagged hybrid overbought on the 12-month algo. This bullish cycle ran through Thursday, January 21^st end-of-day. Here is the final performance of each major index:

VII. QUOTE OF THE WEEK:

“Chance favors the prepared mind.” – Louis Pasteur

Comments »

I dunno. I might not trade for the next few weeks.

First of all winter is finally here. It took long enough. Second I am due to travel over to Lake Tahoe on Wednesday and there just so happens to be some big snow hitting the mountain/lake region.

You must realize, there has been very little snow in the Sierras this year and yet, just maybe, we’ve timed our trip perfectly to have some powder days. I am elated.

I’ll also be meeting my new young nephew, son of our China correspondent, ROBERTO BREGANTE, whilst west…and the prospects of all these events has me in far to good of a mood to potentially sully it trading futures.

You see lads, there are events and people who mean far more to me than economic gain. Two of those things are family and powder days. Put them in the same place and well…good luck putting me to work.

I think finding a passion for something real and tangible can go great lengths in making you a better investors and trader. Gives you perspective and clarity on why you do all these silly things you do to extract fiat american dollars.

The pageantry around transitioning power away from the mean old man to the friendly old man doesn’t even move my meter. However, the women around me seem to be in better spirits and that’s always nice.  Maybe soon they will be up for something daring—like a long night in a cold warehouse drinking hooch while it snows and big speakers wale out metronomic beats for hours on end.

We don’t know.

For now I am content that snow is coming and I am due to ride it with the people who mean the world to me.

Ciao for now.

Raul Santos, January 22nd, 2021

Comments »

Greetings lads. By the looks of it, the NASDAQ is set to open above the prior record high after a barn burner of a globex session. Wall Street seems to be pricing in progress, at least in the pre-market, and with prices at these levels there is not much I feel confident doing at the open.

The higher time frame is likely to be active on the open, either covering shorts, adding to longs, or selling to raise cash. That activity could be erratic at times, and without trading levels to work with up here, I have no way of formulating a trading edge.

Which means I’m not going to trade. There seems to be growing interest lately around why people work. This is good. Having honest conversations about why we work is important to advancing as a species. Why do you work? And this isn’t a question about getting money. Forget that. We are talking about America. Why do you work in America?

You don’t have to. The votes have spoken. We are moving in the direction of universal basic income. That means, in our first world, basic human rights will included food, shelter, education and medical care. None of these things need to be worked for. They will be accessible to all.

Working, commuting, all that stuff, can be very detrimental to one’s health. Many jobs, even ones that currently require college degrees, will be eliminated by automation. If you didn’t have to work, what would you do? Why would you do those things?

These are the types of questions all of us should be meditating on.

Progress has won. The past is the past. Nationalism is dead. We are all earthlings and we’re all going to die. What we choose to do with our brief mortal existence is important. Will it be work? To what end?

Me, I don’t work. I do toil endlessly to grow food that actually has minerals in it. Why? It helps keep my family healthy and might extend our mortal existences by a few years. Also I like how outside work makes me feel—strong and tan.

Why be strong and tan and live longer? Because that means more time to be a ski bum.

Why be a ski bum? Because it makes me feel really, really good when I push my physical limits.

Yes, I am a hedonist.

I also enjoy trading opening bell. Competing in one of the biggest arenas of speculative finance and being good at it bring me joy.

I am a hedonist.

Why do I type these blogs and do all the research stuff? Accountability to my homework makes me a better opening bell trader and I like out competing other agencies and people who possess far more resources than me.

Why?

Because fuck them. Who knows whether they achieved the higher ground through honest or deplorable means, but the laws of large numbers dictate that all things eventually return to the mean. That means the underdogs have potential to rocket higher, overshooting the mean for a bit before reaching some kind of zero gravity, then eventually too reverting to the mean. All while the institutions nervously do their best to sustain flight above the mean. These laws of nature bring me joy.

I am a hedonist.

Anyhow, I am not too proud to know when I have no edge. Today I have no edge. Therefore I will go read books, exercise, peruse the latest seed catalogs, then lean into a nice nap.

Adios.

Raul Santos, January 20th, 2021

Comments »

Good afternoon and good tidings lads. That first working week of 2021 was something was it not? Yes yes and while external events seem to continually trigger babied boomers and weak chinned men who hide behind even weaker beards, the woke or whatever you want to call us are just like…of course.

Nothing amuses me more than when a person logs into a social media platform to air their grievances about the social media platform using the social media platform’s tools. These are very special people. This one especially amuses me. Some folks think I bootlegged Mike’s handle when I made mine. Now here he is, up in his ivory tower somewhere in Florida (lol) tweeting about how he left Twitter:

i propose mike surrenders his handle to me https://t.co/pAkeUamkSd

— RAUL (@IndexModel) January 9, 2021

Going on Twitter to talk about how he doesn’t use Twitter. L. O. L.

Alright now listen, I mean nothing ill upon Mike or anyone else. Life is hardt enough as it is. There is no need for me to project cruelty across the interwebs. I am a decent feller, predisposed with a heck of a beautiful build, who happens to have bolted a model onto the side of Le Fly’s dang time machine that analyzes the behavior of the four major U.S. indices using AUCTION THEORY to create a five day forecast for the stock market. In other words, I built and index model.

That’s it.

That is why my handle on Twitter is @IndexModel (follow me bb…for fleets and tweets).

I came up through the school of thought that said it is impossible to predict the behavior of the stock market. While I hold this to be true, I learned that using data to drive the decision process takes a bit of the mental anguish out of this profession.  Then, the more I began to viscerally understand auction theory and order flow, and the natural way that behavior can move and sway the markets short term, the more I realized I could develop a short term hypothesis that was correct more times than wrong.

I could see…what the market was likely to do over the next 6-30 minutes.

Not always correct.

But correct more times than wrong.

You can drive all the way across the country seeing only a small bit of highway illuminated by the headlights. Same idea. Take it one turn, one straight away, at a time. Okay now make a broad brush stroke in the general vicinity you wish to travel. Now pick your way across the land, back tracking if you reach an impasse, following the water, and so on. This is the five day index model forecast.

If you’re not good at being wrong trading, investing…not for you. Go find some fucking cave with a decent echo chamber, on parler or 8chan or wherever the autists have reconvened, and join along in the circle jerk fantasy of being right.

Hahaha…I’m “right” just barely more than I’m wrong. It comes down to risk management and having my ego stomped, ground up, mutilated, humiliated, and ultimately disintegrated into the ethereal realm where my being simply became just another orb of light occupying a fleshy chemical compound for a blip of time, before floating back into the darkness of space.

Preserving the bindu, I then made my way back to the speculative markets of high finance and began to make my way through the great rotarian scheme as a consistently profitable speculator.

Anyhow nothing lasts. For now things are going okay and that means my job is to convert the recent inflow of fiat into real assets. Places and things I can work with my hands. Earthships and ground-to-air heat transfer systems that will stand for hundreds of years, off the grid, sustaining plant and mammal life.

That’s all. Listen I don’t want to make anyone feel bad about being on the wrong side of history. But dammit, sometimes the only way to make you fuckers see the light is to demean you a bit. For the sake of clarity. The devil knows you’ll need it if you’re to make your way through a world dominated by artificial intelligence and constant surveillance.

Google is good. Amazon is great. We surrender or privacy, as of this date. I’d much rather my life be in the hands of The United Technology Congomerate than The United States of America. Big tech, the internet, these things are more powerful than the intangible (aka collective consciousness) notion of nation states.

Lines on a piece of paper, man. If anything, this place belongs to the trees, man. They were here long before us. They’ll be here long after us—if I have anything to say about it.

We own nothing. Land. We are merely stewards of it during our brief mortal existence. Our body…could easily be caged up by a team of robots. Stocks…L.O.L.

I think they get the point.

Ciao,

Raul Santos, January 10th, 2021

And now, the 320th edition of Strategy Session. Read and enjoy:

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Stocklabs Strategy Session: 01/11/21 – 01/15/21

I. Executive Summary

Raul’s bias score 3.88, medium bull. Markets continue to hold the highs, perhaps trading sideways to mark time, perhaps with a slight upward drift. Keep an eye on Thursday morning. Earnings from Delta airlines and Taiwan semiconductor could put some directional movement into the overall tape heading into the weekend.

II. RECAP OF THE ACTION

Small gap up into the week is faded by sellers. Sellers manage to resolve open gaps left behind Christmas eve with a three heavy hours of selling before a responsive bid steps in, marking the low of the week. An early attempt Wednesday to recapture the lows came close on the tech-heavy NASDAQ but the other majors were well off their lows and we rallied into the weekend. Russell 2000 continues to be bullish divergent for a third week suggesting risk tolerance remains high.

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

Rotational Report:

Lagging tech leaves reason for concern. Energy continues to behave independently from the overall market. Staples and Utilities lagged.

slightly bullish

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

Concentrated Money Flows:

Industry flows break and show big inflows after being muted for several weeks. Last big skew happened back on December 20^th: http://ibankcoin.com/raul3/2020/12/20/how-to-invest-like-a-proper-degenerate/

bullish

Here are this week’s results:

III. Stocklabs ACADEMY

Earnings

The biggest improvement to Stocklabs is the quality and amount of data fed into the systems. As we head into earnings season a key feature becomes critical for navigating the week—knowing who is set to report and when.

This information can be accessed from the Market Overview page. Click the “Earnings” heading to bring up a seven day calendar. Click any date to see who is set to report earnings on that date.

As noted in the executive summary this week, keep an eye on earnings out of TSM and DAL Thursday morning. Semiconductors are the primary driver of our secular bull market and TSM is a major chip maker that could sway the entire PHLX semiconductor index.

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:

Markets continue to hold the highs, perhaps trading sideways to mark time, perhaps with a slight upward drift. Keep an eye on Thursday morning. Earnings from Delta airlines and Taiwan semiconductor could put some directional movement into the overall tape heading 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]:

Semiconductors back to rallying, Transports faked lower than ripped

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 nearly confirmed the failed auction set-up we’ve been watching for weeks. Instead the big red candle printed Monday was immidietly met by a big reversal higher Tuesday than an massive conviction rally Wednesday. This move takes the failed auction risk off the table. Now the question becomes, “are we in a fresh leg of discovery up or a balance?” Delta airline earnings Thursday morning may offer some clarity to our question.

See below:

Semiconductors continue to discover higher prices. MU earnings Thursday afternoon defiantly

See below:

V. INDEX MODEL

Bias model is neutral for a seventh consecutive week. No bias.

VI. Stocklabs Hybrid Overbought.

On Wednesday, January 6^th Stocklabs flagged hybrid overbought on the 12-month algo. This is a bullish cycle that runs through Wednesday, January 20^th end-of-day. Here is the performance of each major index so far:

VII. QUOTE OF THE WEEK:

“I done the best I could with what I had.” – Joe Louis

Trade simple, utilize your resources effectively

 

Comments »