Throwing People into the Fireplace Ahead of the All Important Jobs Report

I am my worst critic. Even though I am exclusively cautious for the month of May only, it’s very hard to sit out when all of the stocks on my “to buy list” trend higher. I mention these stocks in passing, inside The PPT, but do not act upon them. In the big scheme of things, it’s only a month, so what’s the big deal? But I’ve been programmed to treat each day as a massive money making opportunity, as I’ve been accustomed to making quarterly returns inside a singular day numerous times over the past 5 years.

That being said, I am not allocating money ahead of tomorrow’s jobs report. It’s a silly thing to be afraid of, frankly, since good news is good and bad news is better. But I am doing nothing, nonetheless.

Aside from doing nothing, I added to my AMBA position and am currently watching RBCN’s paint dry. All of a sudden, people are skittish on silicon on sapphire. Cowards.

My USG is doing “meh” and I did time the average down in AAPL with precision. But, I’ve been marking time,  watching the ferraris zoom past my impala.

I think I need to sniff some bathsalts or inject some red bull straight into my skull in order to shake the “nervous nellies.”

On that note: DEVELOPING…

I added to my AMBA position.

If you’re like me, burdened with lots of cash into a frantic rally, you are looking for stocks that haven’t moved yet.

To search, I am looking for names and sectors down more than 10% over the past month that are up 2%+ today.

116 stocks appeared on this screen.

Here are my favorites, based upon stocks with the largest short positions.

NOTHING.

After looking at the list, all I see are broken boat stocks, which I happen to own, and gold. Mixed in are some horrific earnings shortfalls and Chinese burrito stocks. The truth of the matter is, buying laggards is a sure fire way to underperform the markets. It’s better to buy what is in style, based on price and liquidity trends.

So what’s working, you ask?

Everything but boat and gold stocks.

Now you ask, what stocks might move to 52 weeks highs?

That’s a question I can answer.

Here is my short list.

CTRP

EXP

CREE

BWLD

TOL

MTH

BZH

FBHS

VAL

BX

There are others, naturally. I have a bias towards housing, so any homebuilder or material play is in my wheelhouse.

If you are too busy to figure out this puzzle, just buy AAPL, for it has bottomed and everyone loves it again.

The European Central Bank on Thursday cut its main refinancing rate by 25 basis points to 0.5 percent, the first rate cut since July 2012.

“Our monetary policy stance will remain accommodative for as long as is needed,” Mario Draghi, the President of the European Central Bank said at a press conference after the decision.

Most economists had expected a rate cut of 25 basis points. Record high unemployment figures for the euro zone released earlier this week and a fall in inflation strengthened the case for a rate cut.

The market was so worried about the fate of stocks, following yesterday’s crash. Due to the severity of the market plunge, Benjamin Bernanke’s best friend, “Money Mario” Draghi, slashed interest rates by 25bps and said free money would be available forever.

As such, S&P futs are +6.

I have the sense of humor that keeps people on edge. No one really knows when I am joking or serious. The truth is, “The Fly” is in a constant state of comedic relief. The blog is great because it allows me to put the world inside of a fished tank–for my amusement. Sometimes I feed the tank garbage, just to see what happens. Other times I feed it the highest quality food money could buy, yet the fish don’t bite.

If you’re new to iBankCoin, welcome to my domain. Feel free to walk around the halls, but be mindful of others, especially the host. While walking around, do not be alarmed if the lights suddenly black out, or a pack of hungry wild pit bulls are let loose to roam.

Humor is everything. Without it, life is boring.

That being said, why is everyone so dramatic over the market decline? Do you really think I am waiting for a market crash?

PFFFFFFFFFFFF.

If your margin call came tomorrow, via magnanimous market decline, sure I’d buy it; but I’m not planning for it. I’ve been trading stocks since the early 90’s. The majority of you plebs were falling out of trees when I was planning my empire. Relax, especially when I call for market drops.

The market isn’t ever going down, at least in my lifetime. There will be brief periods of pause. But, ultimately, it’s a zero ledge world– meaning: we can’t drop.

Free money forever. The Federal Reserve shotgun will put grape into the faces of all who get in their way.

That being said, we’re still going down in May.

Y

Poof! Your never-ending bull market is officially over.

-Merlin

Apologies may be left in the comments section of this post.

TLT has just marched from $114 to $124, without fanfare or untoward publicity. The Yen has rebounded and is starting to gain some upward momentum. At the same time, the SPY continues to hit new highs, all the while the jobs market and earnings come in less than stellar.

I’ve always been a huge advocate, almost to the point of worship, of the Federal Reserve–Benjamin “Blunt Smokin'” Bernanke and his miraculous beard. I was always at the forefront, reminding people what POMO meant for stocks and how a little cocaine never killed anyone, when applied to the markets of course. But even legends such as Ben need a day off, in this case a single month.

Yes, everyone thinks the market will trade down in May; therefore, as all laws of contrarian opinion go, the markets shall rise again. But what about the 6 month winning streak for the SPY? Surely, if the market is up for 6 straight months, there must be some “excess speculative fervor”, no?

According to the laws (don’t shoot the messenger) of seasonality, it doesn’t matter what you think or say. The month of May is siesta time for policy makers. It’s the time of year everyone long stocks finds God, begging for his forgiveness, so that he may grant respite.

I, myself, am a victim today, long both AMBA and RBCN into the sharpest of teeth. My largest position is cash; but I haven’t a solitary hedge. Therefore, it goes without saying, I am losing my shirt today. But there’s a certain feeling of exhilaration in today’s rout, one that demotivates me from acting in favor of watching.

So I shall watch, as the rats scurry about–in search for more cheese. In the meantime, 80% of stocks are lower today. The tape is much worse than the indices suggest.

Losses are mounting on Wall Street, as the diabolical calendar month called “May” makes itself known. As is tradition with the month of “May”, investors “go away” and the stock market does very poorly. Naturally, there will be some trouble makers who refuse to “go away,” loitering about the lobby, attempting to break into the safe. But those people will be punished, ever so harshly.

Evacuate the premised immediately.

“The Devil” is buying CALL today, off the EBIX buyout. Apparently, the penis grabbers over at Copperfield Research, via Seeking Alpha, were short EBIX into a leveraged buyout. They’re so damned stupid. Weren’t they the bozos who were shorting TEA into an already announced ALL CASH buyout from SBUX?

Well, apparently, they are secretly short CALL too, or so goes the rumor. So, as Wall Street would have it, the wolves are at their doorstep, trying to afflict pain and misery onto their already ravaged book.

Other than that, I’m just watching RBCN get its arms and legs blown off on no news.

Very soon, before you know it, while you’re not looking, the market will “surprise sex” you–vaporizing your 4 figure brokerage accounts with reckless abandon.

All of the money you’ve saved, being a good boy, trying to buy a house or a used automobile, will be liquidated by lesbian margin clerks.

At that time, “The Fly” will be in a rocking chair, playing with his globe, blowing smoke into vaulted ceilings. You schmucks think you have all of the answers, bold and brazen in your contempt of my prophecies, impatient to be proven wrong.

All you need to do is wait, very quietly, and you shall be proven wrong–yet again.

I am going to “go away in May” because some cliches are worth believing in. Just like woman are absolutely psychotic during menstrual cycles, so is the stock market during the month of May.

***YOU’VE BEEN WARNED***jackass

Critics argue that I’ve been too cautious for too long, effectively missing out on some good rallies in cocaine and other drug related stocks. The truth is, I am Rocky Balboa, post Clubber Lang knockout, scared while running on the beach with Apollo Creed.

I’ve been taken to the woodshed for two years in a row, after achieving huge gains early on. The collapse occurred the same way it always does: I get all bearish, then lose patience, invest all of my money, then the market collapses.

Rinse and repeat.

It’s the preferred recipe to cook a Fly on Wall Street.

So pardon my apprehensiveness if I opt to wait out the harder months of the year, preserving a high teenage digit return, while living the life of leisure that the Gods intended me to have. There isn’t anything wrong, per se, with having 40% of my assets in cash. It only speak to a profound act of cowardice, one that I admit to be guilty of.

One cannot expect to achieve greatness while watching from the sidelines–all very well and true. But I, my friends, am sitting on the sidelines in an Orbital Space Cannon (OSC)–fully intent on committing aggressive acts of war at a given notice.

Do not worry about Le Fly, for he is partaking in “stock market art,” using his portfolio as a canvas. In time, the gains will come together. Until the market adjusts to what I deem to be “reasonably oversold,” I will continue to flee from risk, running away with a yellow line painted on my back.