The NASDAQ was down 250, but the carnage was far more severe — with SAAS stocks down another staggering 5.7%. At this point it’s fair to call this a crash, tech stocks on the whole off by almost 40% YTD. For the most part during 2022, oil and commodity stocks have been safe havens. Not today pal, as oil got lifted off its feet and smashed down into the pavement cracking its head all over the earth — off by 7%+ for the session. The action in many of the hot trading stocks, especially uranium, absolutely destroyed. UEC was off by 17.5%.
I had entered the day 20% short via TZA/UVXY and the rest long a variety of commodity stocks — all buried in deep losses — setting me back by 5.3% for the day. I wanted to hold, but did not allow myself the luxury. I bit the bullet, ate the losses, in order to slow things down. Something is of course wrong. We have the 10yr soaring to 2.14%, +14bps, beat downs in junk and high grade credits, and overall gloom set upon every industry but old man stocks.
Into the close, I sold out from my inverses, took a TQQQ position to pair with a handful of commodity stocks and kept 75% cash just to torment me during tomorrow’s trade. I hated the day and never feel good after a day like this. I was never in it — down 3% at the open and kept diving lower all day. I made two trades, both losses, and so I called it a day. I could’ve tried to trade — but if I was off I risked a far worse day than -5.3%. It was grim all around — but with this sort of pathetic surrendering of the market I feel it is also constructive for a mean reversion trade.
The Stocklabs long dated algorithms flagged oversold today.
No signal can supersede the absoluteness of panic during a time of war, especially world war. I do not pretend to have all the answers. I can tell you, however, the commodity trade was offered a severe blow today in a very atypical manner and although I still hold some — I feel the trade needs some time to cure itself from today’s damage. The likely trade here is to fade tomorrow’s open and if commodities dive again — start buying with some seriousness.
On the issue of the VIX:
1 x VIX (VXX) gains were nearly 2x the 2x VIX product UVXY. These ETFs are designed to break and it looks like something is very fishy with them now.
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Bought ye old man stocks (MMM, T, and MS) these last three weeks for the first time since 2015. My Grandpa Oran would be proud.
If he’d be alive today, I’d start a TikTok account of just him wondering what the hell are Chinese Burritos, Space Alien Magicians and the Mr Devil Dog.
FNGD lol
Trade is Done
Good evening, iBankCoin – it is I, Mr DevilDog. Financial markets have indeud dislocated, and now face wanton destruction – just as I foretold. If you had the temerity to follow my sage advice you would be basking in riches. But no, for you the most horrendous and egregious stock exchange losses await. Prepare yourselves to be zerohedged under clouds of black smoke and loose shards of metal. I say prepare yourselves for the apocalypse for it is nocking on your door as we speak.
Children like Lindsay Graham and Chuck Todd are making and marketing the foreign relations of this superpower. They speak to the level at which we operate with this planet’s other nuclear superpower. That should make you pause.
$UVXY dropped from 2x to 1.5x leverage after the unusual spike in VIX futures in February 2018.
This Monday, the April VIX futures contract closed about 3% higher and $UVXY closed less than 5% higher. $VXX would have closed about 3% higher if Barclay’s had not suspended $VXX share creations.