I am not so convinced all is well in the world and we are destined to V-shape into outer space. I sold into this rally a bit this morning, covering my Z calls a tad soon.
Then I came back to market, saw the zealous nature of the tape and put on a full size QID. I do not think things are so simple this time with the big picture a bit of a sloppy mess.
Just in case we decide to keep stocks in a microcosm, I bought BBBY short dated risk. This type of trade is something to finance my new set of pots, pans, and what have you.
My cash is high (23%) and I have the eye of a skeptical guy.
I am up nearly a percent today even with this odd mix of market exposure.
There are thousands of ticker symbols in the stock universe, a handful of which I keep a close eye on. But the NASDAQ, I watch every single characteristic of this market. To me and the stocks I follow, it is the major tell. Most importantly, after 300 days of watching every single open, intraday, and close on in the front month future of the NASDAQ, I am realizing 80% of the daily action takes place within minutes of the market opening.
Thus with the right strategy, one should be able to earn as much if not more from the open as they can spending the entire day stalking the futures. Moreover, one should be able to deduce the daily direction and whether to add, reduce, or press your favorite stock picks.
Today I only had time to actively watch the first hour and a half of trade. The opening drive was unexpected and never printed an opening swing low. This is a peculiar type of open and the outcome can be crippling for the leveraged trader. Fading this type of open is stepping in front of a firehouse of buy orders. Yet that was exactly the right move today.
The rest of the day was flat on the index. The hawks and Pelicans managed to find intraday momentum in individual stocks because they are masters, but I want to be as proficient a futures trader as the world has ever seen. The outcome of any economic decision should be measured both on profit and time.
Time is not the friend of the leveraged trader.
1.5 hours of live trading. The 20% of the day that produces 80% of the intraday opportunity. If I can trade even less, perhaps 1 hour, then I will. Then given the information reveled by the morning auction I can choose the best suited algorithm for the hypothesized afternoon order flow conditions.
We have a new saying in the domicile of Raul. It’s an old Irish motto, “Less is more.” If I can properly interpret the opening action, then I can correctly jostle my portfolio and make some money intraday in the futures. The second piece is still in beta testing because we are not rushing the use of leverage. We only use leverage of the futures variety with well calculated plans.
I booked RGSE before the little guy gets away from me again.
I am up a little bit year-to-date. My cash position is over 30% and Elroi is calling for the ball.
I am turning him on to stalk the market while I head to the nearest pub on foot.
May your robots interpret intraday orderflow well fine lads.
The stock pickers are running a full-court press in this sports analogy session. Sellers are on their heels on 4th down and still have some plays up their sleeves, like the shovel pass over the ledge on the SPX.
I took scales in GOGO and BAC this morning, and put some risk into AAPL.
I have taken several meeting today from my new domicile and am currently laboring through many important tasks like building more algos and monitoring the quiet index markets.
We have hit all my upside targets for the day and I am done selling, so I suppose I should just sit here and manage this book I have.
Will the LED trade ever work? In down markets, it is flat. In up markets, it is pro flat. The LED stocks are like CDs with your local credit union except they can gang up on you and steal your shoes at the drop of a hat.
Pressing ATHs with my book alongside the market. Back to work…
If we are really seeing an increase of Russia/Ukraine media coverage [note: media coverage because the reality is always not what it seems] then where should your money be? Come’on this is an easy question, OK I make it easier: in what country?
You have two choices really, but one is CANADA! Canadians are free to roam the world in the name of beer, hockey, and moose. Nobody gets mad at the Canadians buddy! Hence why I added back the BBRY calls I scaled off earlier this week. I am attempting to play BBRY like a delightful little fiddle while sitting on a hot tin market rooftop.
I took all sorts of odd trades today. When it was all said and done, I am very long and here is my book:
Any one of those names could be the next headline pumper. They all still present a unique set of circumstances which merit my attention. Elon Musk intends to build a GIGAFACTORY, powered by the wind and sun, which builds battery packs using 100s of little robot servants and about 600 employees, but he is not the most progressive thinker in modern business. I truly hope this stock never pulls back enough to allow me reentry, and that I only ride my modest position to $1000. If that means getting a solid capitulation from Douglas Kass, then the millennials achieve a major win on Wall Street.
The LED trade has been dead money for many quarters. I have been in most of these stocks for many quarters. Many quarters…it’s enough to bore the meek out. Not me, for I am shameless and willing to patiently wait for this macro juggernaut to hit the tape. Generational shift. Do you think Elon will be putting god damn high pressure sodium bulbs up in the high bays of his future factory? Not a chance in hell. Natural light harvesting and LEDs are the only light sources appropriate to modern man.
We need to see financials strong next week to get us out of intermediate term balance. Market participants were flung back into the thick of balance this afternoon after we failed to auction higher. The classic 1 tick. When you see that, and the weekend is fast approaching, get your guard up. AND PLEASE, stop whining about algorithms and make one you whining whiners. Man I hate whining. STOP WHINING.
If people would take the time to learn the fundamentals of auction theory and then apply them for better or worse in real time, they would never again be surprised or disgusted by the path price takes through time. There is a beautiful harmony to the markets, and it is driven by the laws of physics in a very simple manner. There are about 100 posts where I apply market profile, in real time. Just click the category “Market Profile” on the right-hand side of this post. You may not see the categories from our mobile site.
Finally, I have a hard time with goodbyes. They reveal how much of an influence you can have on people and the impact of your presence. Be grateful for the people you see often, for one day it will all change. Raul is changing with the calendar.
It’s all fake, you get this yet? They want your shares, especially your top shares which you picked up when they were “bottom bitches” cast aside by the rest of the investor class.
We are in the middle of a neutral print right now, the most delicious and powerful market profile concept known to me.
Quite the transposition of events, recently, what with WhatsApp fetching a cool $19 billion and Olympics coming to an end. Now a speculator who survived earning’s season must decide how they will make money for the next three months.
Pro tip: take it one day at a time, like an alcoholic.
Many of my positions are charging higher today. This new high on the NASDAQ composite is acting like a real new high by causing our favorite hot money stocks to run aggressively. It may be prudent to take some profits here, or even to look for an opportune short given the extended nature of the marketplace.
But with all the new money being blown on go-carts and quad racers in CHINA, who am I to scale profits in KNDI? Here’s the KNDI kicker—they build electric cars, and electric cars are hot. You know what isn’t hot? Exposing yourself to the putrid smog of China. They will make a strong push into electric cars, citing the smog, not realizing that most of the energy is coal generated. Meanwhile, they will keep burning old mattresses out back of their shops, near the local water source. Given the kickass manner in which new money behaves, I bought MORE SHARES of KNDI today. It now represents my second largest equity position.
Meanwhile in the crisp air of CANADA buddy, their flagship phone company BLACKBERRY is being chopped into little bits of proprietary software and user interfaces which are being parlayed into new applications using OTHER peoples hardware. Can you say, “that’s exactly what the Drake executives at BBRY need to focus on?” Because it is. And they are. I am inclined to buy more, but the intrinsic value of my current holding is nearly 3x what I would hold in equity. I will add on weakness, slowly, because I am in a position of strength. AND I WILL NEED it, facing a strong competitor in delmur and his March Madness pick SZYM which had a nice look going into the tournament and is providing adequate chase to still win this week.
I also bought some HEMP. This is added to my basket of degeneracy with PHOT and GRNH.
Other highlights on my day include CUDA. With all the network compromise happening today, and the big push to a paperless internet existence, how aren’t you investing in security? You should be, both in real life, and via an investment/trade.
I don’t own any Facebook because I was scared away by a viral youtube video. There is some irony baked into this, but I lack the sense of humor to locate it.
Pardon my absence from the social web of internet traders. You must know, good people, you are some of the finest entities I have ever met. The fact of the matter is sometimes duty calls. As much as I would love nothing more than to be a full time trader, clicking buttons and talking smack on the internets, I also go into the real world, real time, and aggressively hunt down opportunity to make money.
You are all witness to a major life transition for me and you do not even know it. Well, I will tell you because it is big—no HUGE. I am done, I am done being a corporate butt in a seat. Instead I will venture out into the real world and make real money making real moves while shaking dice and pumping iron.
I am short of words. I did not use sleep last night, instead opting to work through the night like any ambitious go getter who had a big old floppy fish jump in their boat. The fish are jumping in the boat PEOPLE.
I checked in with the market, briefly this morning. Only long enough to get in the way of the good work I had done a month ago. I remote connected to my mothership to see ACAD in the green, after the options were 80% worthless only one day prior. Impressed by my now 30% gain, I booked and cooked. Later I come to see I left nearly $3.00 in premium on the table aka several stacks of Benjamins. I pretty much sold everything too soon this week. I am done selling. No more selling until May right? Sell IN MAY, go do something like a richer.
My algo is so slow to develop. I get close, and then I get far, but I continue to fiddle with the dials on my quest to hone in on harmonic rotations. This next iteration of Elroi is going to knock the socks, that much I know.
Top picks, into next week: RVLT, CUDA, and the Drake trade aka BBRY.
PS, I am a few basis point away from being back to black on the year. GOOD ENOUGH, here you go:
Equity futures are slightly up overnight, snapping the consistent seller control the globex hours have experienced all week. This presents us with conditions this morning which are different from all the prior days in this holiday shortened week.
As the USA comes online, prices are right in the middle of a balanced price distribution. There does not appear to be any sort of imbalance in the short term for us to envision scenarios upon.
The buyers are in control of the short timeframe. They were successful in defending us against the “slip zone” yesterday by exhibiting the same type of aggressive demand at these levels as we had seen during the first go at prices. It’s slightly odd, because the profile we were printing yesterday premarket has an imbalanced look—and to complete the distribution would have put us well into the slip zone. This could have started a liquidation trade.
This is an interesting clue, because it signals the buyers were acting with enough haste and force to disrupt the natural process of distribution. By doing do, they claimed control of the short term timeframe.
The intermediate term timeframe is balance. Until we see a higher high, we are in a balancing zone where mean revision is likely. The long term control is in buyers hands.
We could get a sense of buyer sentiment by testing lower today to see if demand still exists at key prices like 3667.50 where we printed a low volume node on a surge of orders. Should we test this level, and not find the same amount of buyer participation, we may continue to test lower to the VPOC at 3665.75 and our value area low at 3655. I have highlighted these levels and a few other observations on the following market profile chart:
