Market Chop Continues

I had nightmares I was down again today, so as per custom — I made sure to close out all of my positions sans my BTC at the open. I was heavily short and fortunate to be up 0.54% in a tape seemingly designed to destroy me. I’ll be trading lightly throughout the day to ensure profit.

We have a big problem here: the US 10Yr is back to the highs 4.15%, up nearly 7bps. I’d like to read into this move in yields more — but every time I do the rates then crash lower. As of now, it appears we have a Fed problem. Sure inflation isn’t gone but for some reason — the FOMC just won’t give up on their autistic 2% inflation level. Why is 2% so fucking magical anyway? Moreover, who the fuck made them master and commander of the entire god damned economy? I know.

After 10am we’ll likely swing up again. I’ll be in cash enjoying the paegentry.

I am having a very arduous time trading this market. I got fooled into the tape in the morning, fooled out later on, and closed at the lows -1.8%. I am now slow walking myself to perdition — off 9% for the month. My single worst drawdown since I’ve made my portfolio public in Stocklabs is -10.0% when my account was $434,000 in September of 2021. Right now my account is a touch under $1.1m.

I say that for two reasons.

1. To boast.
2. No matter how fucked you might think you are, eventually your true nature will shine.

In this case, my true nature happens to be one of a winner — always have been since the days of my early youth. On occasion there are pitstops and fuckers get into my path and derail me. At times it appears I might actually careen into a wall loaded with nothing by dynamite sticks and gasoline. But I always manage a way out from my follies and soon return to do great things, such as making money in the stock exchange.

I admit, this tape is an anathema to me. I do not like this set up and find it confusing.

For example, over the past week close to 200 stocks are down more than 20%. Names include FTNT -21%, RMD -20%, IFF -25%, SEDG -27%, CARL iCLOWN -25%, MTZ -25%, ZI -27%, GNRC -27%, PLUG -22%, SAGE -45%, UPST -46%, NVEI -46%.

The list goes on and on — a graveyard filled with former “hot stocks” have littered the balance sheets of faithful suckers. On the other hand, GOOGL, $NFLX, and $META are up.

Rates are soaring again and inflation is obviously still a concern for the Fed, up against a backdrop of COLLAPSING housing starts — down close to 20% YOY nationwide.

Both healthcare and tech have been down by 3% overall the past week yet the VIX is under $16, suggestive that nothing is as it seems. There isn’t risk premium built into puts — because people are confident that Joe Fucking Biden is in control. With that said, we are doling out yet another $24b to Ukraine, an amount so obscene that people don’t even care at this point. We have donated more money and arms to Ukraine more than any donation given to any country, by any country, in modern history.

Yet zero fucks given.

And what did we get? A failed offensive due to lack of air support and training — lots and lots of dead people on both sides. This, for our leaders, is a desirable outcome. I am not happy to see Russia winning — because it means Ukrainian men are dying.

You can see how betting against this entire narrative is both an alluring and an emotional one — which is a recipe for potential catastrophe. In spite of my 9% debacle MTD, I’ve tried to be measured in my approach — always keeping both longs and shorts. My luck has run out and my persistence has not produced desirable outcomes. I closed the session again NET SHORT nearly 30% in inverse ETFs, 20% cash, the rest longs.

Should I drawdown again tomorrow, I will be forced to reduce my trade size to prevent further damage to my accounts.

SIRS —

I have been dispatched yet again. I am now off by 5% for the week, 1.5% for the session, in what can only be described as my worst trading in a very long time. The culprit? I am just terrible. Instead of blaming my poor trading on things, such as fucked knees and POW camp styled diet — I will instead tell you flatly that I have been disinterested in the market.

This implies exactly what you think I am saying: if I was interested and really “into it” — I’d be up. Prove me wrong.

Following Joe’s personally handcrafted CPI number, we are once again FUCKING COLLAPSING against the rocks and stones. I got fooled and tricked — bought in and kept my energy holdings — and now I am paying the price for my unbridled greed. The smart play would’ve been cash. The even smarter move was to SELL THIS FUCKER SHORT at 10am and then proceed to watch breadth tank from 75% to 40%.

I must tell you, this sordid breadth collapse bodes very poorly and in the past would cause GREAT CONCERN for me. Alas, I am holding firm and taking on water. There is a festering anger in me that prevents me from being truly happy. I love to have enemies and have my back up against the wall with people betting against me, again a byproduct of growing up in the sewers of Brooklyn pre-gentrification. This is exactly what I needed to get back into the game: a cold slap across the face producing a taste of blood. OR, maybe I am over and I’ll never trade good again — proceed to humiliate myself until death with STACKED LOSSES of a carnivale nature — becoming a laughing stock both online and at home where Mrs. Fly might perhaps disclose my trading prowess at dinner with friends over a chardonnay and how it produced such extravagant and ever-lasting tax losses.

Joe Biden personally produced the perfect CPI number that both captivates and amazes. We are steaming ahead at 3.2%, up from 3.0%, but slower than the consensus of 3.3%. In other words, perfect.

The only real tell in markets today, aside from upsurging stocks, is the euro — up 0.5% v the dollar. The suggestion is, Joe Biden is a financial genius and has managed to not only defeat inflation and normalize the interest rate curve — but he’s done so without causing a god damned recession. Well, technically that isn’t true, since we had a recession but the media and the govt changed the definition of what a recession was, in order to protect Americans from themselves, see.

Bottom line: we are bullish again, thanks in large part to the brilliance and serious management of our ancient leader Joseph Biden. The price of iced cream is reducing and the summer is still hot — so get out there kids and grab a scoop or two, you fat fucks, and bite into it just like Joe.

Ahead of tomorrow’s CPI data, traders fucked off and sold their wares. But to believe this only happened due to a pending inflation datapoint is folly. Take a look around. The market has become a fucking graveyard for post earnings debacles, case in point today’s cataclysmic 24% drop in SMCI.

Will the CPI come in hot?

Who gives a shit? A low CPI has already been factored in and only a surprise to the upside stands to truly fuck us with MOAR FOMC rapings.

Here is the more relevant story — a broken trend line suggestive of looming and debilitating collapse of equity prices.

We may very well remember these slow afternoon drawdowns in the summer of 2023 as the precipice of what was to come — the inevitable and determinate catastrophic declines to come into the cooler climes and hotter times.

Markets are listing lower today — but again straight up from the early morning collapse. At the vanguard of today’s strength are oil and gas stocks — partly due to a busting loose of Brent (now nearing $90bbl) and natural gas. Over in Europe, Dutch TTF spot is +28%, as winter looms.

Morning pin action suggests chicanery, largess.

If you dig into some hourly data — you will find that since July 1 the trend has been to buy morning dips and fade them into the afternoon. This is not the sort of action that is conducive to a stress free life.

My issue with buying and holding now is due to the murderholes being produced post earnings and/or news. Today alone more than 120 stocks are down by more than 5% in an index that is barely lower. In other words, if you’re not pigeon holed in the biggest stocks and have attempted to try your luck elsewhere — you’re being flayed alive.

The prime movers are oil and gas. This was a trade made popular in the early stages of the war — where we saw risk off but also on in the commodity sectors most afflicted by the regional conflict in Ukraine.

With Autumn fast approaching, I believe in this trade more and more. The overvalued skew of the tech sectors crossed against the seemingly undervalued oils presents a very good trade, in my opinion. Much of this is predicated upon supplies and of course demand out of China. Nothing is as it seems and there is very little that I can predict with great accuracy. My strengths lies with being changeable — although I will admit to having a bias here long commodities/short stocks.  I feel and always have felt if the global economy was strong we’d see it reflected in the price of oil. I do not believe there is any risk premium in the price of WTI today, since it has been rigged lower by incessant US SPR released.

But those days are fast ending and the risk of global war looms larger than ever — which of course produces an environ where oil can be bid up to heights never seen before. Because of this, any time we see oil breaking out – I am a buyer.

Markets are down today and luckily I dodged the morning bullet and kept a 20bps gain for the session. We are suddenly waiting for and interested in inflation data — because oil has been soaring and our fat hedonistic brainless leaders want war — so the price of things, almost all things, is inexorably at risk of going up.

Ladies and Gents — you might not know it but you should. America is on its last legs as a coherent populous with shared history and culture. I chanced upon a year in review of 1985 a week ago, at that time I was 9. We live in an entirely different world. The immigration policies of this country has assured that by 2045 American’s of European descent aka “the whites” will be a minority at 45%. Whilst to the ordinary non-racist plebeian — this news is benign. After all, you’re not against some diversity and you’re certainly not hateful.

To quote a great man: “well, that’s just like your opinion, man.”

The collapse is 100% assured, partly due to the fact that people no longer want to have babies and are much more interested in having fun and going on watered slides and stuffing their fat fucking faces with pie. They’d prefer to date women well into their 40s and visit concerts and drink beers with their homosexual bachelor friends, and then wake up the next morning and drink juice from the bottle. We are a listless people because our purpose has been annihilated.

Having said that, maybe a great big world war is exactly what we need to cull the herd and wake people up. Perhaps this is just the way things have to be to reset people. You must admit, this is a wholly stupid way to get people to create families and to make interesting things. What if we had a state level effort to promote traditional values? I bet a sense of normalcy would return to a mostly atheistic and gluttonous people. But that’s not part of ZE PLAN!

The country doesn’t belong to you. You simply rent it. The people who own it are changing it and if you don’t like it — well then — go make your own country.

I actually wasn’t bearish today. I even stated as much in an earlier blog. Sure the opening trade was dreadful and I opened up down 2.2%. But throughout the session I bobbed and weaved and traded well, actually. You can tell where there is going.

I held one hedge, a small 5% position in UVIX and didn’t pay it any attention because I was, like I said, trading well and booking profits. But then UVIX dropped 5% from my basis and I thought about what I should do. Normally I’d simply sell it out and forget it. But for some reason I was intrigued by the seemingly nonsensical collapse of volatility. Then again, why should I have been “intrigued” since all VIX does it drop. Nevertheless, I doubled down with an intent of dumping the whole thing on a small market drop.

That never happened.

The losses were now double and the ETF just kept sinking. All this time I kept trading exclusively to the upside and booking small profits, a little here and a little there. Slowly but surely, just like the other day when I did a gazillion trades, I did a gazillion trades today and closed exactly at my session lows. I ended up closing out the UVIX trade for a $15k+ loss.

I’m not mad or even disappointed. It’s just one of those odd things that happens to people and you soon forget about it because it had no bearing on your life whatsoever. In spite of being down 7.5% for August, I am trading well, seeing the market fine — but history will only reflect upon this month in 2023 as a loser for me.

I closed smaller with 42% cash, allocated into more conservative names because the method I need to enact now is slow and steady attempt at redemption for the balance of the month.

Yes of course I fucked my year and I’m not even up 40% anymore — instead +38%. But I don’t care. Perhaps it’s my diet or maybe the knee — but I possess zero emote in this regard and feel, almost mechanically, that all of my recent drawdowns can and will be easily recouped.

Lots of bad news today, such as Moody’s downgrading a bunch of regional banks, Chinese exports to the US collapse, Italy affixing 40% taxes to their banks — etc. The Nasdaq is off by 183, and the US 10 yr straddled at 4.01%.

The breadth is an appalling 35% and VIX is spiking.

All of this would lead me to believe a rally was NOT in fact even remotely possible. There is simply too many reasons to sell, especially since the market has risen so much and we’re in August and only losers are trading a lot now, instead of going on boats to drink seltzer water and look at the fucking fish through the lenses of $400 sunglasses.

But we’ll likely rise anyway — since the new approach to Post modernism is to go towards and gallop into the dumbest of all scenarios. The worse the news is the better. The biggest degenerates are the most celebrated and any semblance of cognitive thinking is eschewed, mocked even, by soulless demons without families or a future.

As a permanent bear, it’s important that we WADE THROUGH IT and resist the temptation to short everything into dust — because odds are the dumbest path will be the one most readily traveled, worn out even.

Have you ever talked to people outside — get a sense of what they’re thinking or listen to their syntax and vocabulary range?

We are most certainly living in the last of Empire Pax Americana. I only wish I can live long enough to see it though and to profit from it — puts on the whole thing — the entire experiment as it bursts and concaves into flames and the savage beast of its populace busts loose like zombie hordes to cannibalize in open fields and prey upon the weak — but regularly offered shotgun bursts of metal into their faces when chanced upon towns of the minute varietal.

Naturally I am entering today without hedges, fully exposed to the horrors of the morning, NASDAQ futs down 120.

Here are the low lights.

ALREADY WEAK ITALY BANKS COLLAPSE pic.twitter.com/pQo428SbGu

— The_Real_Fly (@The_Real_Fly) August 8, 2023

MORNING MELTDOWNS pic.twitter.com/XwFdKWWzS8

— The_Real_Fly (@The_Real_Fly) August 8, 2023

Looks like we have a hard miss out of DICK DOG, which is sending shares of other SAAS plays interminably down into the sewers and beyond. I will face horrid losses at the open, one day removed from having glorious hedges. Alas, this is the story of life — here one second gone the next.

The trend has been to inverse the open, so perhaps we might climb higher today in spite of all of the negativity.