Running into Significant Resistance, Not To Mention the Buzz Saw of Q2

I’m not saying we’re heading lower — because nothing in the data suggests that should happen. But there are a few reasons why you should lighten up here — especially after such a big run up.

We’re right now at a level where a lot of people got caught long several months back. People are likely eager to sell around these levels to count their blessings and move to cash. Also, we should expect to hear about Q2 in March, possibly Apple. We know Q1 was horrible and the market priced it in. What if Q2 isn’t good enough to justify the run up?

Trump is touting progress in his negotiations with China. But is President Xi likely to cede to his demands with the US elections less than 2 yrs away?

Lastly, QQQ is now overbought in Exodus, with flawless stats implying downside action. The last time we were overbought on the Qs, the market topped out and barreled lower, starting the late 2018 panic.

This is what I did today.

NIO +15%, QD +15.3%, LX +9.8%, HYRE +21%, OLED +9.5%, BILI +10.6%, PLUG +7.3%, CY +1.2%, HABT +1%, TLRY -2.5%, DATA +1.5%.

See pal, that’s who I am and you’re nothing.

Oh but you’re a good Father?

FUCK YOU GO HOME AND PLAY WITH YOUR KIDS.

My opinion is that you should be taking profits. But nothing is bearish, in spite of today’s tepid action in crude. HYG was up. The indices were sharply higher. Everything is fine. I anticipate a pull back — but shall not act upon my urges until I see it happen.

I ride into the close a supreme winner, of a magnitude you could only dream of accomplishing. I cannot be defeated, or stopped — because the Gods favour me.

Prove me wrong.

Former Fed Chair, Janet Yellen, all but called President Trump a fucking orange ape today, in a radio interview — discussing the President’s financial illiteracy.

Asked if she thinks the president “has a grasp of economic policy,” Yellen flatly responded, “No, I do not.”

“Well, I doubt that he would even be able to say that the Fed’s goals are maximum employment and price stability, which is the goals that Congress have assigned to the Fed,” she added in the interview with American Public Media’s “Marketplace.” “He’s made comments about the Fed having an exchange-rate objective in order to support his trade plans, or possibly targeting the U.S. balance of trade. And, you know, I think comments like that shows a lack of understanding of the impact of the Fed on the economy, and appropriate policy goals.”

When it comes to economics, she said Monday that Trump misunderstands some fairly elementary concepts, citing his stance on reducing trade deficits with China and other global partners.

“And when I continually hear focus by the president and some of his advisers on remedying bilateral trade deficits with other trade partners, I think almost any economist would tell you that there’s no real meaning to bilateral trade deficits, and it’s not an appropriate objective of policy,” she said.

Yellen is not alone in getting skewered by Trump.

Her successor, Jerome Powell, has come under intense criticism for raising interest rates, and there was even speculation that Trump might replace him.

Yellen said Trump’s pressure on what is supposed to be an independent Fed isn’t healthy.

“President Trump’s comments about Chair Powell and about the Fed do concern me, because if that becomes concerted, I think it does have the impact, especially if conditions in the U.S. for any reason were to deteriorate, it could undermine confidence in the Fed,” she said. “And I think that that would be a bad thing.”

TRUMP BTFO. What will Donny do? Will he shrink from this round of grape shot into his vessel or will he rise to the occasion and fire off a series of really mean tweets?

DEVELOPING…

This trade was exclusive for Exodus playas.

THIS IS A KILL, up 25% so far and still going.

I took profits in a variety of small capped stocks this morning — because that’s what I said I’d do weeks ago when the Qs hit $175. Well, here we are and now is the time to harvest gains and relax.

Booked NIO +15%, QD +15.3%, LX +9.8%, HYRE +21%, OLED +9.5%, BILI +10.6%, PLUG +7.3%, and CY +1.2%.

Try to keep up.

This from the President of the United States.

I am pleased to report that the U.S. has made substantial progress in our trade talks with China on important structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues. As a result of these very productive talks, I will be delaying the U.S. increase in tariffs now scheduled for March 1. Assuming both sides make additional progress, we will be planning a Summit for President Xi and myself, at Mar-a-Lago, to conclude an agreement. A very good weekend for U.S. & China!

As a result, a flurry of Chinese stocks are sharply higher this morning, including NIO, BILI, HUYA, LX, QD — just to name a few. When stocks open in 10 mins, we’ll have a more comprehensive list for you to salivate over.

NOTE: Chinese stocks soared nearly 6% last night — the highest level in 4 years.

This stock was on a fast track for zero just a few months ago. Alas, now it’s higher by 15% this morning, up ~50% the past 3 months.

GE sells biopharma unit to Danaher for $21.4B GE sells biopharma unit to Danaher for $21.4B

Danaher will buy the biopharmaceutical business of General Electric in a $21.4 billion deal, the companies announced Monday.

The deal will see Danaher pay $21 billion in cash, as well as assume certain GE pension liabilities.

The GE Life Sciences unit will join Danaher’s Life Science as a stand-alone business. The GE Biopharma unit is expected to generate about $3.2 billion in revenue this year.

GE shares surged more than 17 percent in premarket trading from Friday’s close of $10.17 a share. Danaher’s stock also jumped, rising 5.2 percent from its previous close of $113.48 a share.

“We are executing on our strategy by taking thoughtful and deliberate action to reduce leverage and strengthen our balance sheet,” GE Chairman and CEO Larry Culp said in a statement.

Wow, what a deal. Roche is acquiring ONCE for $120 per day, or $4.8b. As a result, the entire biotech sector is lit — especially gene therapy stocks like QURE+17.79%, BOLD +17.62%, RGNX+11.83%, CRSP+7.36%, SGMO +6.91%, VYGR+6.63%, EDIT+5.99%, NTLA+5.83%.

Futures are +130, in spite of oil being down 1.6%. Look for a potential blow off top today — especially if oil continues to weaken. I have about 5 stocks this morning higher by 5% or more, so that has me somewhat suspicious.

Large-cap BioPharma have spent ~$36B on acquisitions for shiny sexy cell and gene therapy:$GILD -> $KITE $12B$CELG -> $KITE $10B$NVS -> $AVXS $9B
Roche -> $ONCE $5B

Will any of these deals generate a positive return?
The first two not looking so hot so far…

— Andy Biotech (@AndyBiotech) February 25, 2019

I am long. This event was alerted to Exodus members on Friday.

Watch

I’m a huge data nerd and like to believe that I have an edge on many of my enemies — because I pay close attention to the shifts in the winds of the market. One of the breezes I watch regularly is performance by market cap. For years, large caps have crushed small. Very rarely will small caps, as a whole, beat out the overall market. Last year, when I was investing my Quant based upon market cap performance, the selections never chose market caps under $1b — because they always underperformed.

Last week, all stocks jumped by 1.36%, on average — but stocks under $1b in cap leaped by 1.8%. More uniquely, this outperformance extended all the way down to market caps under $50 million, alluding to a risk on scenario that is wantonly degenerate.

It would be foolish to believe such a trend in risk will end abruptly, since we’re all having so much fun trading now.

I tell you these things now — because I am a generous and charitable man. I realize you don’t delve into small caps — because you’re above it and the ticker symbols you possess are all very distinguished and honorable. I, on the other hand, view these things as nothing more than burning pieces of scrap paper flickering into the gusty wind. Hold them too long, and you’ll get burned.

But it’s so much fun seeing it all unravel and I’ll admit that I love the sense of ruin that stalks me when I’m trading them.