NASDAQ SUFFERS WORST SEPTEMBER DECLINE SINCE 2008

Listen to me. You might think you understand how the market works; but you don’t know shit. At junctures such as this one, human intuition must kick in and you must see the forest through the trees. It’s happening now. All of the bullshit has leaned onto one side of the boat and it’s about to be capsize into the fucking sea — where the blood and the feces will flow heavily and those standing in the way of correction will drown in it.

October of 2022 will go on record as one of the worst ever. We are now mirroring 2008 and if history is of any ancillary use — we shall bleed in October.

I’d like to tell you “it’s not all doom and gloom, hey take a look at this trans-homo-sexual cosmetic stock making waves in America” — but I cannot.

It’s over.

This is what you’re gonna do next. Sign up for this info form and find out about our fucking stock contest for October. The first person to blow up his account to zero will receive $1,000 clean from me. This is how the good folks at Stocklabs help out the poors.

I closed the session at the highs +165bps, by trading like Merlin in and out of longs and shorts — quite frankly a dizzying array of fuckery that I sometimes partake in to test my trading skills. Ignore the AH’s lift, total fughazi. We spill out and knife lower on Monday.

Congrats and ciao.

Rundown of today's Putin speech today pic.twitter.com/9kwJaLoHqI

— The_Real_Fly (@The_Real_Fly) September 30, 2022

Happy trading fucked for faces.

On this last day of September have you leaned anything? Bankers in England were saying had it not been for the Bank of England intervention into the GILTs market — they would’ve had a Lehman styled event and wiped themselves out clean.

Russia is on the move and scheduled to send “large echelons” of military equipment into Belarus by November for a Kiev surprise.

The United Steaks most likely committed terrorism by blowing up Nord Stream 1 and 2.

The world is a fucking powder keg and we have lunatics at the wheel.

This is what I do not, aside from whatever might happen today.

We are going to crash thru the fucking floor boards during October, as all of these FX issues and spiking of rates comes to a head. We are vulnerable here, just like we were after the collapse in September of 2008 which led to an absolute panic during October and then November.

To help, the good folks over at Stocklabs are hosting a TRADING CONTEST for October. But instead of asking you to make money, I will instead permit you to do what you do best: blow your accounts to smithereens. First lad to create a portfolio inside SL with a balance of $100k and blow the fuck up to zero will receive $1,000. It’ll be like Brewster’s Millions and I’d be interested to see how many of you triple your accounts in an attempt to zero them out.

I do what I can and during the blood month of Halloween, on the precipice of doom, I am happy to help.

NASDAQ Futs has been +120 until early morning here. I’m not sure if it was due to Putin’s speech; but the weakness occurred at the same time.

Here is a rundown of what he said:

Today is the end of the quarter and I suspect volatility. Market would love to trade up here, so be careful with your shorts. The fact that we dove lower at the open after giving up big gains in the futures markets might bode well for stocks if we reverse up. Either way, this chop makes it very hard to trade and if you go to eat a sandwich you might miss a giant pivot and end up fucking yourself for the session.

I bulked up heavily on GUSH with a large UVIX hedge and own some BOIL. With 55% cash and losses of 6% for September, I am bound to close out the month an extreme loser. I can succor myself with facts on the table, such as “this has been a terrible month for stocks” and how I outperformed the broader indices. HOWEVER, my benchmark isn’t the broader indices and I should have done better, especially since I expected a September collapse and talked about it forever.

I can blame my week off for COVID and how I shed nearly 10% off the highs due to COVID brain trading. BUT, today’s -2.85% was all me. I longed into today like an absolute pavement ape.

I’ve had many periods of sucking wind and it’s never easy to trade in chop. I am emboldened by the fact that I always make it out the other end fine. Eventually there will be a tape that is custom built for me or I will see something other’s don’t or can’t and propel back to annual highs.

For the year I am +42%, so it’s not all doom and gloom.

I cleaned it all out and took my losses like a fucking man. I had two choices: revel in my own stupidity OR do something about it.

I bulked up on UVIX and added to my GUSH position and the balance is cash, at around 70%.

The Fed said this about 30 mins ago.

FED’S MESTER: RECESSION WON’T STOP FED FROM RAISING RATES

Do you understand what that means?

ZERO CHANCE OF SURVIVAL. THERE IS NOTHING YOU CAN DO TO STOP IT.

When I saw futures tumble last night I knew what I was in store for since I decided yesterday to not hedge and to barrel into today with large long exposure. I haven’t turned on my monitors until now, furious at myself for being fooled, tricked even, by a very predictable and unfortunate outcome.

The market didn’t rally today because this is a bear market. Yesterday we all basked in the glory of the market bounce and today we suffer from the pangs of hubris.

It’s over and has been over for quite some time. In true bear fashion, all hopes and dreams are crashed against the rocks of reality and all fantasies of yesterday are almost mirages, mere memories of a time when pain and suffering wasn’t the main focus of asset prices.

Im down nearly 3% today. All of my work for the week destroyed. I’ll have to decide whether to go further into this hole and pray for a bounce tomorrow or get back in line with the bear.

Today was a classic bottom. We had pandemonium in Asian trade, paired with blowout FX markets and bonds — not to mention Apple’s warnings. Today we reversed up and closed with nearly 90% breadth. Granted, we had a limp close — but I believe that to be a trap.

By the textbook, based upon the collapse in the 10yr, rise in Euro and GBP — we should continue higher tomorrow and climb the wall of worry into the quarter end.

I spoke to an old friend of mine yesterday. You might know him as “The Devil.” I will have you know, he made the call — went long yesterday into the panic, and more or less shares my opinion for continuation.

IF we fade tomorrow and continue down, we might really see a panic. But let’s not even think about such a scenario.

I closed +150bps in trading, +313bps in quant and +10% in algo account — no hedges into tomorrow’s grande show.

For many years since I created the mean reversion algos of The PPT, then Exodus and now Stocklabs, I search for ways to use the signals for short term trading. Most of the time the signals were accurate and one buy would suffice. But on occasion, there would be broken elevator trading action and the OS signals were laughed at by the market and dove lower through them.

But I think I have solved the issue in regards to position sizing and timing my buys — using the signals.

This is how I do it now.

Upon an OS signal, before market close I made a 33% allocation into either TQQQ or TNA. The holding period of this position is 5 trading days — win lose or draw. The holding period can be extended only if another OS signal appears, at which point I add another 33% and reset the holding period to another 5 days.

Presently I am 100% long TNA due to consecutive OS signals. This account has done maybe 7 trades all year, +18% at annual highs.

I am tempted to sell being up 8% for the session, but cannot. Rules are rules. This TNA position will remain in place until Monday.

With the yuan crashing 1.2% last night and NASDAQ Futs diving 150, I thought for sure we’d get a horrid open. But instead, 70% of stocks are up. This is classic look into the abyss but come out a man trading action.

I closed out my UVIX hedge and added two longs, just in case this turns into a ripper. I’m still 66% cash, so I have plenty of reserves to defend my positions need be.

+55bps early going and liking the action.

This is the situation. All metrics inside Stocklabs point to unprecedented levels of oversold. We have various metrics that go back decades and the current market you see here is on par with the worst technical set ups. I seem to be saying this often because the deleterious degrees of this downturns keep getting worse — from dot coms to financial crisis to COVID lows to SHMITA.

This is where we are.

Not only are we on the verge of World War, we are also in a situation where the demand for dollars is a significant stress on foreign banks. The result of this has been an upending in EUR, GBP and JPY crosses. The Fed hikes are creating an environment where people only want dollars. The spikes in yields are the result of investors finally believing the Fed will raise rates into the fires of poor economic fallout.

The stated goal is “shock n awe” markets and collapse prices fast, in order to defeat inflation, followed by a Fed pause which they hope will satiate and stabilize markets.

All of that, however, is down the road. What we have in front of us is a terrible tape. The Nasdaq is down 9% for September, the worse September decline since 2008. This time is different?

Probably not.

Since all metrics point to an oversold bounce looming right around the corner, I am biased and positioned long. But, because this set up is so terrible and the extent of time we are oversold, I am apprehensive and have hedged my longs with UVIX.

I closed out 67% cash, 10% UVIX — +2.2% for the day.

Good luck.