iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
21,906 Blog Posts

The Moment of Truth Fast Approaches

Listen to me.

The idea was Russia was going to withhold its precious oil and gas and we’d starve because we didn’t have any wheat or fertilizer. That’s what our brains said, but the market is saying something else. The market is saying you’ll eat bugs in the cold dark trench and enjoy it. Perhaps the supply shock is going to MORE THAN OFFSET with mind numbing depression. Perhaps that’s what the market is trying to say with oil down 5% and Natty down 8% and everything else getting hammered.

Or, maybe I’m being overly dramatic.

But one thing is indelibly true, basic material stocks are down 10% the past month and your favorite ag plays like IPI, MOS and CF have been de-balled, down anywhere from 20-42% over a 1 month time period.

It’s over.

The same PIN ACTION can be seen in the oils and today truly is a pivotal day in the history of stocks. Our mean reversion algorithms encroach on historical low readings and it would behoove us not to rally sometime soon, preferably tomorrow.

Plainly, I no long have the stomach for the intra-day racket and have opted for a more austere approach — leaning on swing trades. I have only a handful of old man stocks left, having closed out my UVIX position. I would think the only trade into the close is to be long something, based on these oversold readings. But to do so would mean we dive into the concrete pool hoping enough water will be there in the morning to protect our skulls. My best sense is to get long in the afternoon to a small degree and average down in a potential gap down tomorrow.

On the issue of commodities, they will bounce too. But it seems, and this goes without saying, they no longer act defensively and are just like any other sector now. The sole safe haven is now in consumer staples alone.

If you enjoy the content at iBankCoin, please follow us on Twitter

6 comments

  1. purdy

    Through the last five years COST has grown at a 10%/yr rate …this through QE and stimi checks. To date, it’s held up relatively well as people see it as a cheap place to get stuff. But when they can afford stuff? A mature company with a current PE of 40?

    • 0
    • 0
    • 0 Deem this to be "Fake News"
  2. traderconfessions
    traderconfessions

    The market just wants to wipe the floor with the meme stock clowns who soiled its corridors with gross insolence and braggadocio. BTW, how’s that bro at Barstool doing nowadays? I think the get-rich-quick folks are adequately impoverished now so the market will rally somewhat this week. You can iBankcoin on that prediction. If we are on our way to a depression I’m set with a veggie garden and enough fishing gear to feed a village… if inclined.

    • 2
    • 0
    • 0 Deem this to be "Fake News"
  3. discoordinated
    discoordinated

    Consumer staples… wheat futures are the only think I’m feeling good about right now. Wild day. Maybe down another 8% start buying ?

    • 0
    • 0
    • 0 Deem this to be "Fake News"
  4. the_wolf

    Respectfully disagree good professor
    Energy (oil &gas) and Ag remain sectors of rotation, safety and interest, the long term trend in energy is up and to the right ,it remains intact

    Oily wolfman

    • 0
    • 0
    • 0 Deem this to be "Fake News"
  5. the_wolf

    The bogus may 9 fear mind killer
    Don’t forget the major supply and demand issues still exist with no solutions

    • 0
    • 0
    • 0 Deem this to be "Fake News"

Leave a Reply