It turns out the NASDAQ printed what is called a normal day in market profile theory and the fun thing about normal days is they are anything but.  In fact, they are rather rare.

And I must say I do not particularly like normal days, at least not up here at swing highs, because they tend to occur at or near inflection points.  A normal day is described as having a very wide initial balance (first hour of trade) which is not breached for the remainder of the session.  It suggests indecision, intraday, mostly signaling directional conviction is low.

That context makes sense if think about gapping higher, in a hot (too hot?) bull trend, into a short holiday week.  Short sellers do not want to get steamrolled in the thin trade, buyers are hesitant to initiate additional exposure at these elevated levels, and current longs are likely mulling taking profits.

Add to that the narrow pockets of market momentum and you have a solid recipe for indecision.

I have my book about 90% long at this indecisive juncture.  AMBA finally went to work, crushing the hopes and dreams of Morgan Stanley analysis hoping to make a name in the technology space.  I like to think this guy who downgraded AMBA will read the Raul blog, so I have a special message for him: this chipset powers the GoPro, it is on the X-mas list of every adventurer.  Short interest, albeit modest, will start to get icy hands as we approach December 5^th earnings.  Then they will start making mistakes.

The chicken trade adhered to the November seasonality statistics, naturally, unlike the unnatural meat produced in PPCs new streamlined robot facilities.  December brings a tad bit more seasonality mojo, and we still have national eat 1-to-3-birds-at-once day Thursday.  I took an obligatory 1/3 scale today, but I like my prospects with the net.

I bought AAPL back right near the closing bell.  If you recall, I was in this trade a few weeks back and bailed with a little 2 percent gain.  It is an easy vehicle for me to lever long exposure up and down, as it consolidates along gently.

I now hold large positions in the following names, listed largest-to-smallest:

GOGO, RVLT, BALT, YELP, and CREE

These are all full size positions.  As you may imagine, this type of book requires attentiveness.  It has the capability of lopping 10% off my person rather effortlessly.

My ¾ size positions are as follows, listed again largest-to-smallest:

AMBA, AAPL, PPC, LO, and TSLA

Note: AMBA was by far my largest position prior to taking a scale near today’s high.  Tesla and their innovative CEO Elon Musk are in the house of pain.  Much like any successful individual, the media will frame Elon with a skeptical eye.  Innovators hunt profit and self-gain after all, which is inherently evil.  The issue most closely watched at TSLA is the battery technology.  If it is to usher in the era of zero emission commuting, it needs to hold up to rigorous scrutiny.  If Telsa intends to roll out a model for the middle class, they need sound battery technology established.  The chart is just basing out, below my favorite moving averages, suggesting acceptance of these lower prices.  What likely comes next is a new exploration lower by price.  This will scare most of you.  But I will be casually observing the action, minding the drawdown to my books, and meticulously selecting an opportunity to ratchet up exposure because I love me some sweet baby Elon.

I have dog and pony positions in the following stocks.  These positions are practically placeholders and some are relics from prior trades:

F, FXY, ONVO, TWTR, MJNA, and O

I thought I would turn a clever trick in MJNA.  Now I am -40% on this stupid, STUPID, holding.  It will enjoy a fake pump service or go to zero otherwise I will continue to hold this dumbness.

ONVO needs to die for a while.  It trades poorly.  I will keep my toe in the water to keep my eyes on the name.

TWTR is another name I will hold until zero.  I use twitter more than any other social media service in the world, why wouldn’t I own it?  One day I will have huge size, but right now there simply is not much to base my risk on.  Therefore I wait.

This post has gone on far too long.  These are my holdings and some reasoning behind them.  Let’s see how they perform this week.

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Today the old man woke up at a customary 4am, sans alarm clock, and slowly rose from his twin-size bed positioned appropriately across the room from his wife.  He prepared his straight razor with smooth swipes across the grit of his sharpening belt.  His thin lips held onto a cigarette as he removed any trace of facial hair with a generation of confidence.  He swung the washroom door open and emerged from a thick cloud of smoke in a Tom Ford suit and said, “I want Cisco.”

And so went the day.  Old men across the nation dialed their rotary phones and demanded their brokers buy shares of CSCO, in 1000 lot increments, until instructed to stop.  The action firmed up the Dow Jones as well as the S&P 500.

We are only 10 points away from the 1800 market on the SPX and I am 95% long.  There was a mix of winners on the day.  The peddlers sold down GOGO today after an impressive gap which is to be expected from the degenerate class.  Meanwhile ONVO ripped the hearts out of shorts and fed them to the pigs.

The chicken play in PPC is setting up finally, and if we close the week out strong prospects look solid for a rise into the gluttonous festivities of Thanksgiving.

Facebook wants needs to corner the sexting market.  Without it, they are vulnerable to rapid extinction due to lack of attracting teenage use.  On the contrary, teenagers are smoking LO’s Blu brand eCigarettes at a growing rate.  LO is winning over the next generation of smoking class.

I am completely out of energy, here’s my book:

AMBA, PPC, AAPL, GOGO, RVLT, TSLA, LO, YGE, WLT, SFM, BALT, CREE, F, ONVO, FXY, TWTR, MJNA, and O

Many of those are partials.  The main size is from AMBA-to-WALT

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Ladies, gentlemen, please…allow me a moment to address the market.

You may not make it down to the Raul blog often, but I reside rather gingerly on the front page of iBankCoin.  I know that my continued existence in these hallowed halls amongst the finest strangers the internet has to offer depends on one very important matter: banking coin at criminal rates.

After exhibiting complacency two weeks ago Friday I have been on the receiving end of a severe bludgeoning via shares of PPC due to a salmonella scare.  I regret to inform you I was forced out of this position today and took a large loss.  Let’s talk about large losses.

This was a ten percent position and I stopped out at twelve and a half percent.  Math:

0.1*0.12=0.012

I lost 1.2% of my account value.  Part of me wanted to ride the stock into earnings for the glory.  I envisioned myself riding into town on a chicken-drawn chariot with plebs laying olive branches on the street.  Upon reaching to town square I would be handed the ceremonial staff to perform a blessing of the populares, restoring balance to the social classes.

But in a rather stoic manner I cut the shares loose.  Because the truth is public perception is fickle.  Many of you are simple, as am I, and lack the resources or time to give a company a full fundamental shake.  I know inputs to making chicken meat are down across the board, but so does anyone else who analysis this company.  Elon Musk set a new standard with his quick assessment and public response to the Model S fire and now I expect the same from all companies.  I get Old Wall Street silence instead.  So PPC and its shareholders can go fly a kite for all I care and I’m back in the sewers, hungry as ever.

I cut LEDS too.  Perhaps the critics were fiddling with their catalytic converters when I scaled 10% profits one day into my campaign.  That would justify tossing tomatoes in my direction when I cut my net position for a scratch.

Finally, I cut SCTY.  Let’s say you love bath salts but all you can find on sale is old fashioned Mexican speedball.  You decide something is better than nothing and in your constant urge for instant gratification you gobble like ten Mexican speedballs.  But since you want that bath-salt-bug-eyed rage fueling your body while you chew arms off hobos, you find the speed only providing an uneasy feeling in the pit of your stomach.  That’s why I cut SCTY for a 3.4% loss.

My final move was buying a modest allotment of AMBA shares.  Morgan Stanly flip flops and the investment community dumps Ambarella?  GMAFB.  Well actually, you did give me a break because this was an opportunity to get back on board stock in a great company.  I liked it at 22, why wouldn’t I love it at 20?  I am a buyer of further weakness.

Now I have 22% cash power to buy some blood and a stable of stocks fit for an entrepreneur.  Largest-to-smallest friends, largest-to-smallest like always:

GOGO (huge), LO (+15% what?), ONVO, WLT (Walter), RVLT (a love/hate), AMBA (SAIL!), SFM, CREE, SLW, F, FXY, IMMR, MJNA, and the big O

That is a hot look.  I like this basket of stocks.  I have a few names I want to add to the pot to get back to full long exposure but I am content to ride into tomorrow’s spooky trade with some cashish. The Fly’s ALJ has the look, FB is making ATH after hours, and YELP is at a slight discount.

FINALLY: YOU SHOULD COME INSIDE 12631.  There is a free trial tomorrow and Friday ONLY.  I do my best work in there with little-to-no shenanigans.  I would love to see some of my twitter buddies in there.  The password for the free trial will be released at midnight, so you vampires can come inside tonight and kick some ideas around and us normal folk will see you bright and early.

http://youtu.be/c-P5GpkPrk4

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Let me start by saying I am not thrilled with the action in the S&P 500.  I was discussing this with one of my most distinguished readers, gentleman UncleBuccs.  My chart brain sees lower prices in store before news highs are achieved.

So I did what any responsible person would do when confronted with these “facts” …I bought stocks.

I still have some cash on the books, about 25% which is about the highest my cash has been this year.  But I have a huge position in RVLT, a huge position in ONVO, and a huge position in CREE.  My next largest position is USO because I think oil is just going to surprise everyone and rip tits into year end, taxing the tight wad consumer before x-mas.

Everything else is ¾ size or smaller: LO, Z, GOGO

Then my slow money: F and O

Then a tiny IMMR I keep for sport and this stupid MJNA long—down 20% waiting for a pop to sell into.  It will come.  It is a matter of time not will.

I traded the futures less this week, especially after I got gang banged by algorithms Tuesday.  I took a conservative trade in the /ES yesterday that worked out well.  Today, that same conservative nature caused me to miss an idea I mapped out very well.  Oh well, there is always next week.  /NQ is looking promising as anything I have ever seen—both on a discretionary and algorithmic basis.

About this time every week I am overcome with a huge feeling of gratefulness.  Thank you for reading along.  I love this work and interacting with my internet people.  Have a great weekend.

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I can do anything.

We sure do cover the /ES_F often over here on the Raul blog, discussing its…implications, if you will.  Building the contextual cake helps me to identify abnormalities, flinches, and hand tips by the big money.   The E-mini S&P is the most liquid financial instrument in the world.  It makes sense to pay attention to it.

But trading it has become a slow and painful grind.  It is like going years without a dish washer even though you love to cook.  You get by, but your soul dies a little every day.

I needed some change (No Obama) so I traded the /NQ.  I like the NQ…peep today’s stats:

Thoughts:

• today had a large range
• /NQ is thinner
• smaller contract size suits my size a bit nicer
• I trade lots of Nasdaq and Russell stocks so I may be concentrating my eggs
• It offers more trading opportunities (at least lately)

/ES has been brain numbing, while I go ‘big pimpin’ on these wiry stocks.  Speaking of which, my book was up a percent today.  That is a result of stock prowess and hanging out with traders much more seasoned then me.  Mainly my gains today were a result of being on the right end of a technology revolution.  So while sour bastards get their kicks shorting Tesla, which is fine, I am embracing the future and finding opportunities to invest in it.

In short: CREE and RVLT what what?

I started buying ONVO too, right about at these levels.  You can’t keep me out of this name.  When my pickled organs give out I want robots around to print new ones.  Seems like a no brainer at five fifty.  I consider it an investment in myself.

I sold YGE.  It felt like when I sold VIPS yesterday…too soon-ish.  However, dwelling on these thoughts prohibits the mind from seeking opportunity elsewhere.  I sold RBCN too, for a loss, because it sort of just fell out after mainlining hot money.  I do not want to be around when the Apple WWDC crowd goes running for the doors, should they do so.

ADHD is a ticker which by design frustrates me, ripping higher like a freshman jacked up on Mountain Dew and Ripped Fuel.  Ah high school…when ephedra was still legal.  I have wanted a long on this one for a few weeks but my attention keeps darting away from it.  Instead I want to Snapchat and play ping pong in the futures.

I do not really love the way we are setting up into the weekend.  The market looks like the headless horseman.  Sentiment sucks but the crowd isn’t always wrong.  I have concentrated by book down to the following positions listed largest to smallest:

RVLT, CREE, USO, LO, BALT, AMBA, FB, ONVO, F, IMMR, MJNA, O

That jackass MJNA stock can burn up and go to zero for all I care.  What a garbage stock.  I am -20% on that field play.  I thought about cutting O about 100 times, but I figure keep it and collect the yield.  My basis is a tad below here.

Everything else I hold close to chest.  As a matter of fact, I need more CREE and RVLT but I am exercising patience.  Together the stocks represent almost 30% of my risk capital.

I will let Q4 play out a bit before getting more risk into those two names.  In the mean time I can increase my LED exposure via VECO, RBCN, GTAT, OESX, and LYTS.

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For most of my tenure as a trader stocks have been treated like a singular asset class and thus tightly correlated to other macro instruments like bonds, the US dollar, gold, and oil.  The binary nature drove me to studying futures because if all stocks were hell-bent on moving as one, I might as well trade them all simultaneously with an ass load of leverage.

I love the futures markets.  They are pure order flow with no dependence on a company and their decisions.  But seeing good companies and more importantly good charts succeed even while the market chops around is exciting.

It makes me want to concentrate more funds into stock trading.

I got caught on the wrong side (the long side) of the quick drop this morning.  Even though I preach plan adherence, I deviated and had to take a ton of heat on my trade.  The poor entry, paired with a non-market related event which shall not be mentioned but which has officially created a rule, caused me to shake out of my long—I shit you not—one tick off the morning swing low (about 11am).  No less than five minutes later, what I had expected—a bit of a bounce to cut my loss into—occurred.

This was a huge setback to my futures trading, huge.  I am so sick of setbacks incurred from plan deviation.  They are huge drains on emotional capital.

I went and had some tacos with a friend.  We talked about hunting mushrooms and it was quite the stimulating conversation and helped clear my mind to assess everything.  Trading structure will be restored for tomorrow’s action and it is good to make these mistakes while trading small, believe me.

Focusing so much energy on work and trading futures allows me to think much more slowly about stocks.  The more I learn from the excellent traders and stock pickers here at iBankCoin the better this approach feels.  My book is up 2.5% today while the Big Board chops the UNCH.

RVLT is a big part of the green portfolio, but it is getting plenty of help from IMMR, MHR, YGE, BALT, and FB.  My account is straight crack rock and ripping.

I see a huge consolidation occurring, as if we are waiting for news flow to get this party started.  Bull or bear, a party is near—I can hear the bass rumbles in the distance.  Until this decision is clearly made, I will hold the line, 90% long.

My slow money is in AIXG, LO, RVLT, MJNA, FB, O, F, and CREE

My fast money is in AMBA, IMMR, MHR, YGE, BALT, RBCN, and CLF

I still hold a sharp edge in the futures market and my win/loss ratio shows it.  The p/l however does not yet because of setbacks.  This isn’t over until I win which is simply a matter of time, not if.  This week however, my stock gains are casting a bright glow on my futures losses.

Pro Tip:  Like any business, be sure you are sufficiently capitalized.  Better yet, have other revenue streams so this learning process doesn’t come with the added stress of keeping a roof over your head.

http://youtu.be/cJT1xvDOMB0

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The market has been unable to compel me into action today.  Instead I have sat here drinking coffee and watching my peers rip the faces off of shorts with supreme ultra-violence.  My goodness, RaginCajun extracts a solid win off of EGLE, passes the baton to Le Fly and here we are, winning the relay.

One of my twitter buds was all over the shippers move too, well done @Apoms24 on the DRYS.

The day after a huge move, overnight or RTH, tends to be tricky intraday.  Therefore, I sat in the bleachers and enjoyed the view.

Book largest-to-smallest: CREE, RVLT, RBCN, AIXG, Z, MHR, FB, CLF, LO, F, IMMR, MJNA, and O

Cash: 20%

Tickers of interest: YGE, FSLR, ONVO, ZNGA, FRO, END, and GMCR

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I couldn’t pull the trigger on anything today, not to sell existing shares, not to buy new shares, and I have SKF already which feel like a bit much in this tape.

I stalked CREE today, it is setting up perhaps.  I wanted to buy shares much lower, so if this setup does trigger I may just trade a piece and go back into my core size (3/4).

Current longs, by size: RBCN, SKF, RVLT, AIXG, CREE, FB, LO, EXK, F, IMMR, MJNA, and O.

Cash around 25 percent.

The O was very strong at the open.  That is a nasty little fade right there.

I lost some money in the futures today when I was shaken out of my short by the clown show in my brain.  I called the head and shoulders this AM to the tick.  But instead of capitalizing on it, I sat in traffic listening to Traffic.  The clown ring leader is Gary Busey.

I’m holding out for my favorite setups before I put any more cash to work.

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Into the weekend I would like to very briefly run down my portfolio holdings and the reasoning behind each.  This information is coming off the rip after a long week.  Thus any thing with a flimsy justification may need to go.

Here we go, from largest to smallest holding:

Cash – I have 20 percent of my book sitting cash.  I’m eager to deploy it on the long side

SKF – I’m using a three year volume profile chart to view BRK/B, WFC, GS, C, etc. and I see a great volume pocket below prices.  Plus they’ve broken down off their respective highs and are printing tight bear flags.  The overall market is on unstable footing and I want some levered short exposure.

RVLT – Yes, it’s my largest long holding and currently the bane of my stock existence.  It earned largest ranking when I blew out my YGE and YELP shares this week.  They were my prior biggies.  The stock is trading worse than a bag of dicks at a hot dog eating contest.  There are no buyers and presumably a few large sellers cashing in on the 600% plus move that took place up unto the day I bought the stock.  The business model is stronger than ever, the shift in focus from consumer products to large scale retrofits is brilliant, and the investor population is still very shortsighted on the opportunity in lighting.  I still love this name, and I plan to cost average in through several quarters.

AIXG – My German LED company.  I love LED technology and I see this company as a beneficiary in Europe due to their energy awareness.  The stock has been dead money for months and I continue to hold.  Nothing has changed here, but this consolidation has excellent potential energy.

END – Huge short interest, oil exploration, and a hot chart.

CREE – Same as RVLT and AIXG, I want these names until incandescent and HID bulbs die.  I’ve been in since January, why exit now?

TRLA – I love their app and use it constantly, the chart looks great, Zillow has been a beast, value added to realty pros, and Le Fly is in the name.

CLF – Tight consolidation, looks like it wants to rip and if it doesn’t the risk is really low.  OA went YOLO on it this week too, although it never moved so that may have been a small loss.

FB – Marky Mark and the poke crew are getting it done.  Holding

LO – Blu eCigs and menthol cigarrets won’t actually get banned.  Interest rates need to stop rising, it’s making the coupon less attractive.

F – Still a strong chart and a nice product line.  This is a patriot long still kicking around my port since the 4^th of July

IMMR – haptics are way underutilized by porn.  I think the porn industry will drive growth here 😉 Also, a Le Fly favorite.

USO – I should still be large but I took a bunch of scales on the way up.  I almost sold it all.  Look, that would have been really dumb.

O – it too pays a large coupon which is losing allure with bond rates rising.  I traded my favorite reversal pattern really well in here with a large position.  The locked in gains dipped my cost basis way down here.  So I’m basically break even on the idea, waiting to collect some coupon.

That’s my holdings.  I’m interested in a few other names, like SFM and GOGO, but will wait until next week to act (obviously).

Have a great weekend everyone,

Raul

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My book recaptured over 1.5 percent of the most recent losses today if you don’t count RVLT.  Unfortunately for the Raul, RVLT very much indeed counts, and today’s respite was much less.

BLAST.

A stock down big during an all-up tape is like a cold dagger to the back.  The blade is chilled even further, perhaps dipped in liquid nitrogen, when a stock gets crushed on no news…simply more sellers than buyers.  But since said blade has been dipped in liquid cold nitrogen with the intent of delivering a shrilling cold death blow it is brittle.  Pathetically brittle in fact, to the point where my Greek bones, formed atop Mount Olympus, shatter the dagger into a million tiny fragments at the point of contact.

Such is the eventual fate of those who bet against me in RVLT.  Of that you can rest assured. I added to my position today.

Other interesting thoughts toddling through my mind: I started getting the itch to size my O long back up yesterday.  I didn’t actively listen, and the thought continued in my mind all day, like a catchy merry-go-round jingle.  I like O down here, but I know so little about REITS and RATES and ROUTS which made me a bit abash to sounds the horns.  Consider this: O is unch on YTD and pays a 5.5% coupon.  If you didn’t get a piece of the capital appreciation, you’re still making bank.  Relax, and wade into this space before it is again en vogue.

YGE was my largest position coming into the day.  I’ve been in this name for quite a while, wondering if I’d one day wakeup to a Chinese air raid, a Red Dawn of sorts.  It hasn’t happened yet.  The Chinese have been very kind to me because I’m a diplomatic gent.  Respect is important in all cultures.  That being said I consider this week’s action is YGE to be of the do-or-die ­variety because we’ve reached a critical juncture on the chart that can explode in either direction.  Odds favor the long side still, so I’m expecting the gods to shine on these solar panels.

The tape as dictated by the /ES got a bit ahead of itself today.  This became evident when the market didn’t rotate off the value hump at 1652.25.  Given the weight of tomorrow’s Fed talk and the confluence of value around these levels, to disregard them and print higher seemed either surprisingly bullish or getting a bit ahead of ourselves.  The market, our favorite arbiter, answered that question by swiftly correcting the tape into the bell.  It was nothing more than a ruler slap to the bull’s knuckles IMHO.

Being about 85% long, I clearly am free of bias.

But seriously, I work hard to remain objective in my profile analysis.

Until tomorrow,

Raul

 

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