This is an interesting set up. We bottomed out early morning and have been trending up in the face of what appeared to be a harsh revoke. As it was setting up, I closed out both UVIX and SQQQ positions and bought some GUSH. I am flat for the session — and have recently added TMV, more short euros via EUO and traded in and out of VLO for the session.
The reality is this.
Risk stocks are still down 2% for the session.
The US 10yr is +15bps
The Euro is down 1.18% v the strong dollar
CS is down 6.8%
Add to that the fact oil is bid higher, we have a developing narrative of inflation again, which we understand is a negative for stocks in the short term.
All of the things that red flag for a down market are present today — and it’s worth noting in spite of the recent hour or so rally — we are appreciably lower. There is a desire for markets to rally on all days by the PERMANENT BULL class of investor — but some days are just lower.
On a side note, after some studying of my entry and exits, I’ve decided to leg in smaller — at 2.5% of assets unless extremely confident in the position. My normal position sizes are 5% and I will at times increase it to 10% and on rare occasions higher. Generally speaking, my trades work — as proven by my returns. However, due to the volatile nature of these moves, coupled with the fact that at times my ideas are good but my timing off by a little, I’ve decided to leg in smaller at 2.5% with full intent of increasing to 5% by session end.If you enjoy the content at iBankCoin, please follow us on Twitter