This Week in Exodus: $SPY ADVANCES; $XLE DECLINES

I’m not sure if all of you know this, since we’re all very busy and all, but I am fully disclosing all of my Exodus algorithmic trades this year, with real time alerts and precise p&l accounting. I started the beginning of the year with a $100k account for the sake of simplicity. More people in the world don’t have 7 or 8 figures to play around with, like most of my Wall st friends, who are complete assholes, by the way.

The purpose of this is to finally put my money where my mouth is. I’ve been talking up Exodus for a long time now, since 2008. But I couldn’t give up the individual stock trading, the gut driven trades, or the degenerate momentum stuff, until now.

After 2014 and 2015, I am done with it. After all, why should I literally kill myself, take years off my life expectancy, when I have this unbelievable mean reversion tool that’s hitting accuracy levels upwards of 80%?

I’m also gonna start doing these recaps once per week, not only to try to sell you on the virtues of the software that I created and put my soul into, but to really give you an understanding how it works and how, as the creator of the darn thing, I use it.

Last week was very important for three reasons.

1. My SPY long position progressed higher, coming off a systemwide oversold signal the previous week.

Here is my Exodus blog post announcing the trade .

2. My XLE short, which represented 75% of my account my Friday of last week, all done in a methodical way, one 25% tranche at a time, really started to diverge from the market. It looks really weak and ready to break lower. Unfortunately, I was forced to cover 1/3rd of my short on Friday. The way my system works is trades must close out on the 10th trading day, win, lose or draw. It’s the best way to mitigate risk, when using mean reversion as a method to place trades.

Here is my XLE post.

3. TLT paid a monthly dividend, reducing my cost basis below $120. This is the only non-Exodus position on my books. It’s because I have a bearish bias and want the safety and security of treasuries. I intend to hold this until the yield curve inverts. It has been one of my best trades ever, truly a work of sublime genius.

Overall, I’m up around 4% for the year, not a big deal. But more impressive than that is the low beta, low risk manner by which it was accomplished. When everyone was pulling their hair and teeth out in January and February, I was eating sandwiches and having a ball. Sure, the market went up a lot since then and some lucky people made a killing. I’ve been playing that game for 20 years. Believe me, no one can crush a bull market like me and no one loves to play these rallies like me.

Most of you already know that.

But this market is rigged, totally unreliable, and the economy is getting worse, which places the average investor at a stark disadvantage.

I have leveled the playing field for so many. Exodus is the real deal and I’m gonna prove it, week in and week out.

This is an epic film of the first magnitude, for numerous reasons.

For one, it’s one of the few films in cinema history that didn’t cast a speaking role for a woman. This movie travailed for almost 4 hours and the director and producers went out of their way to give zero fucks about diversity, casting zero women in the process. Pretty cool.

Peter O’toole played the world war 1 British soldier T.E. Lawrence in a plight to lead an Arab revolt against the fucking Turks. Unfortunately, it appears Mr. Lawrence might’ve been raped by some Turks in the process, in a very controversial scene.

If you’re impatient and enjoy the stupidity of Michael Bay movies, you will not enjoy this film. It represents quality of the very first class.

Here is my favorite scene, bestowed upon the gawking class by none other than the legendary Anthony Quinn.

Ten thousand apologies for the lack of rapid fire content on this magical reversal day. My predictions of doom have fallen short for the day. However, I beg you to take notice that I am positioned perfectly, short XLE with leverage, long SPY, long TLT. None of these ideas were granted to me in my dreams or by the shadows talking to me at my in house urinal. All of them were the product of Exodus.

The reversal was and is magnificent. The payroll numbers caused Fed’s Mester to offer more of her sagely advice as to when we should hike rates: she wants it often and with a relentless appeal.

Nevertheless, the bear class is a very weak and drug addled personnel. For the most part, these are unhappy people who just want the world to burn, so that everyone else could wallow in their misery. But the facts remain: this rally is of the stupid varietal and it will be checked hard within three weeks hence. That’s been my hard line in the sand all along.

I’m long SPY from $202.15 and will not sell it before April the 8th. My XLE short will begin to unwind soon. That’s about all I will sell about that to non-paying, bedraggled members of the reader class.

Wish me good fortune and a safe flight, for I have visions ofa Twilight Zone type creature menacing my engine amidst the lightning and the thunder right outside my airplane window.

Bearish, bearish, bearish.

No one gives a shit that MCD, TGT, WMT and some car washes added 215k jobs in March, when Fed’s Mester is practically slobbering over herself on teevee now, clamoring to hike rates.

I’ll make this simple for you to understand. Even some of you Bernie supporters will get it.

This rally was wholly predicated around the Fed easing up on rate hike increases. The strong data will give them the excuse they need to hike, or continue to menace us with threats of hikes.

Earnings season is here. They will not be good.

The rally will begin to unwind now.

You’re probably thinking this post is an April fool’s day joke. Instead, it is your tombstone.

European markets are crashing through the floor-boards. Crude is lower. Casino stocks are reporting heinous revenue numbers out of Macau, as a rather ironic anti-graft campaign by the inherently fraudulent Chinese govt makes its way through them like a swarm of locusts.

The weaklings in France have capitulated like mice, once again.

Everyone knows crude is going lower, even the idiot George Bush. I am short XLE, like a champion.

Lastly, the ark floats. There isn’t any more room on it. I’ve accepted three lions and twelve mongoose today to board near the last compartments in the hull. If you want to board, you will have to share a cage with wild turkeys.

I’ll be busy all day in preparation for travel. If you have any questions, feel free to leave them in the comments section and I’ll get back to you later on.

No matter which way you slice it, these numbers are an abomination. Sure, they’re not as bad as last year’s -39% dread filled collapse. Moreover, these numbers are mild in comparison to 2014’s -34%. But to see this occur again and again without respite is demoralizing.

Macau Gaming Inspection and Coordination Bureau reported March gross gaming rev (GGR) -16.3% YoY to 17.98 bln patacas ($2.25 bln) vs. -39.4% in March 2015 and -0.1% last month. GGR is down 13.3% YTD. Gross gaming rev peaked in 2014 and fell 34.3% in 2015 after the Chinese govt cracked down on money laundering in the VIP segment of the gaming market. Estimates call for a low double digit decline this year. Macau stocks have surged off the lows this year after WYNN/LVS discussed sequential improvement on their Q4 conference calls.

Shares of WYNN and LVS are set to trade lower. In my opinion, the gaming sector should get poleaxed.

Japan’s NIKKEI is down more than 500, or 3.1% on a very negative business sentiment reading–the worst in 3 years. The Hang Seng is down in sympathy, off by 281 or 1.36%.

The primary excuse for poor Japanese business sentiment, aside from a sick perverted affinity for robots and anime, is the strong Yen. Fucking HORSESHIT.

Nasdaq futures are down 14.

Here are some of the losers trading in Japan.

It’s all going to hell anyway. You might as well enjoy the slide lower.

As an aside, what’s up with the media’s obsession with taking pictures of random, often disheveled, asian men or women walking past a wall of high end monitors–which are displaying heinous stock quotes? It cracks me up, without fail.