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
22,571 Blog Posts

WELCOME TO THE NEW BULL

Nothing stops it. There were bids all day long and sellers were quickly disposed of and incinerated inside crematorias.

I will have you know — I gained 1.07% today, whilst being skinned alive in yet another wayward sojourn into hedging. I closed out my SOXS with 30 mins to go — but then reapplied some SQQQ at the bell.

I will tell you this only between me and you: I am spiritually very bearish. But my senses point to higher prices and I can feeeeeeeel the momentum building and the panic amidst the bears — FOMO accumulating and the bulls renvigored with viagra pills ready to fuck.

I only hedged out of sentiment and will likely lose money on it first thing this morning. As a point in fact, I am likely to continue hedging and losing for the balance of the year, or even for as long as I live!

Hedging will commence until the blood is flowing heavily through the streets. And it will be then and then only shall I be satiated and happy to set my focus on other things, aside from the complete destruction of the stock exchange.

This are just the candid thoughts of one man.

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WE ARE RALLYING

Crypto miners are +30% for the year thus far. Tech and healthcare sectors are +6% — with all others up in the range of 3-5%. The only down parts of the market are in oil and gas — which is burdened by an unusually warm winter — as NATO applies weather weapons to the environ to deal with the gas shortages.

We all wait, EAGERLY, for a reversal — since it is known that stocks “belong” lower. But we’re not getting that and if I might suggest, boldly even, to avoid a net short position whilst this rally takes place.

The Russell is only +3 for the month, NASDAQ +2%. The indices are lagging due to large capped tech underperforming.

Inside Stocklabs, we are fantastically overbought. In the past, during bull markets, OB meant up. In the bear, OB was down. Am I to believe this is a new bull market or is this just another ruse and will fall flat and go back lower.

It should be noted, the hardest hit stocks of 2022, stocks down 35% or more, have not rallied in 2023. They are, on the whole, down 1.1% YTD — much of the losses found in SAAS.

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The Underlying Bias is Bullish

Perhaps this blog will serve as some sort of good luck charm, a contrarian indicator if you will, and send stocks packing and swimming lower without a vest. But it appears to me, a mere expert professional in the arts of investment management, that the market wants to go higher.

We have a softening in oil/gas and a strengthening in tech, biotech, even cryptos. There is a upwards bias thus far in 2023 and you cannot deny it. I cannot deny it.

That being said, we are reminded of previous bull runs and how they all fell face flat into the mud. There is a discernible difference, however, and it lies simply in the new calendar year. Gone is the anxiety of high paid hedge fund managers who got buried in 2022, eager to avoid mistakes. With a clean slate, investors are more apt to apply risk — especially when markets are seemingly bullish.

Even though we are bullish, we in the most royal of terms must remain vigilant and be available to sell short at a drop of a hat.

I’m presently +45bps, down 45bps from session highs with a small SOXS hedge — however willing and eager to increase it at the first sign of danger.

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FULL FUCKING COLLAPSE INTO THE CLOSE

In a controversial move, I unhedged myself into the close and kept a rather large SOXL position — due to the rug being pulled from it late in the day based off the Apple is gonna DOMP AVGO by 2025 rumors.

FUCK OFF.

I spent the day BEARING WITNESS to my +160bps worth of gains withering away down to 1 bps. I tried my best to stem the fucking tide, against a 100% long only portfolio. I traded to and fro, 7 for 8 in trades to the good — but could not offset the FUCKING FUCKERY of this GOTU stock I held for a 15% intra day COLLAPSE.

Some might say this market is primed, ripened even, for absolute collapse. I will take the other side of that trade, if just for a day or two, and suggest tomorrow will gap higher — effectively ripping the skin off the faces of all of the people inside Stocklabs who are SHORT and talking mean to me. FUCK YOU AND FUCK OFF.


Today’s Chicaney

With regards to the overbought signal inside Stocklabs today, I bought a second tranche of SQQQ in my algo dedicated account for the purposes of trading the OB signal by selling short stocks. I am now +1.2% on the SQQQ position and will sell it in exactly 5 trading days.

All in all, it was a dispiriting day for those of us long, evil even. Having a book filled with longs and just seeing it get rocked all day was depressing and at times — a bit too much to bear. Nevertheless, I remain steadfast in the enteral belief that I will trade great again and I will, at some point, rip the lips off of those who sully me and that I will have my revenge of a rapish quality.

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Most Hated Market Of All Time

The pain trade is DOWN gentlemen, always down. With the vast majority of Americans invested via retirement and discretionary accounts, the pain trade is almost always DOWN, except for rare occasions when the gloom is so infectious and caustic — the move higher comes as a surprise.

Here we are again, gingerly trodding higher amidst deleterious economic circumstances. Ordinary plebs are having their septic tanks explode on them, shitted lawns, all the while Lawrence Summers vacations in the Caribbean informing said pleb that his job is about to be lost in order to preserve the FOMC mandate.

All market professionals understand stocks belong lower. Those of us unburdened with the shackles of having to manage it for others, collect exorbitant fees, trading from wine cellars, really just want the whole thing to burn down — sometimes because others might’ve retired from managing OPM in 2017.

But will it?

The answer is YES! The market will, at some point, crash and burn — and it’ll make for a great spectacle. However endearing the thought might be, as of now, sadly, we are trending up.

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Another Ripper

Zero complaints if you’re a permanent bull. Everything you like to see is happening. Stocks are happy and fat. Bears crucified and their bodies displayed for all future potential bears to see as a warning.

I closed out my trading account this morning, as is customary for me at the start of a new week, +152bps in spite of a monstrous 8.8% loss in my SOXS hedge. I would’ve been up 3% this morning if it weren’t for that small misfortune.

I can and will allay my hedging losses on the fact that the market has stunk to high heavens for the better part of the past 12 months. Even though we are rallying and all seems to be going well for Pax Americana, it is clear to me that the market is overbought and also it’s clear to me that stocks are vulnerable to a weak economic backdrop.

Nevertheless, price action is king and right now the prices are going up.

I’ll re allocate a 100% long book after 12pm today, using the Stocklabs weekly quant.

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Overview of Market Action for the First Week of January 2023

Let me just say, I cannot believe it’s 2023. The time flies and not in a very graceful way.

Here’s my take on week 1 of 2023.

It was rot up until Friday, typical of the sort of market we’ve endured for more than a year. The big leaders were in China: BABA +22%, PDD +17%, fucking BEKE +27%.

Airlines +11%
Gold +10%
Copper +8.9%
Aluminum +8%
Foreign banks +7%

Interesting divergence between copper and other materials and oil. For a long time they traded in sync; but recent weakness in oil and gas has caused a divergence — with oils lagging and stocks like FCX, X, and CLF surging.

On the issue of gold: I believe it has filled the void the SHITCOINERS left behind with their disaster. Is gold done going higher? If this is a legit breakout — hardly. Here are seasonal returns in January for AEM.

From 2014 to 2017, gold socks commenced sizable breakouts in January, much more than the current +10% gains.

Interestingly, there is a tight correlation with gold and rates. As you can see below, as TLT goes — so does AEM.

I’d argue TLT is way ahead of itself here, with limited upside potential. Who are we kidding — inflation isn’t dead and the Fed are not going to slash rates just to save some fucking retards leveraged long NFLX.

Regarding the FAANGT block of stocks — middling — with outperformance in META/NFLX and woeful underperformance in TSLA — as monsters like Bill Miller sell it short.

If I didn’t have a brain and only glanced at the price action of stocks for the first week of January, I’d like it. Lots of industries jimmied higher, from retail to tech. The high growth cash burners DID NOT bode as well as real companies like WYNN (+13%) — which is a good thing. If we start next week strong again, I might just get out of my own way and stop hedging.

There is, however, an overbought signal inside Stocklabs now on our long dated mean reversion algorithm — which is foreboding. In the past, the OS was a buy and the OB was a buy — because stocks always went up. But over the past year of bear, the OB was most definitely a sell signal — solidifying my thesis to be true that a bear market would in fact be actionable with the often ignored OB during bull runs.

My confidence level on any signal, including my own, is always met with suspicion. I don’t view this as some sort of holy grail, but instead a guide to the past and what might be in the future. But like Ebenezer Scrooge once found out, the future can be altered based upon some good deeds. Should we get some news that is BAD next week, we might very well continue to rally — because we’re at the point in the cycle where bad news is now viewed as good for stocks.

NEVERTHELESS, I activated my algo account, which has been dormant since October, to sell short stocks via SQQQ. God willing, I will be entreated with gains early next week — betting on the misfortune of others — snatching their gold chains and making them mine.

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MARKETS EXPLODE HIGHER ON NEWS THE ECONOMY IS IN RUINS

I am salty — specifically because I managed a long only book into a loss of 87 bps today via an outrageous loss in a SOXS position gone awry. No need to rehash old news — for I am certain it will ruin my weekend. Let’s just say I had it pegged wrong — because I underestimated the fervor of the PERMANENT BULL class of investor.

It should also be noted, many stocks faded into the close, sans tech — which was strong throughout the session. During bull runs, these types of fades are part and parcel of keeping bears committed to being retarded. I will not look too much into it, since the Dow rose 700 off the back of RUINOUS news that the economy is in contraction.

The theory goes… slower growth means more job losses means Fed pause. The only issue I have with this train of thought is that it’s fucking stupid. The economy slowing does not equate Fed easing — since those cuckholds are waiting for 2% CPI — which should come back ’round by about 2026. It is very likely rates will be above 6% by year end — at which point the economy would be in shambles and only those with cash would be able to sop up assets on the cheap. The timing will of course be tantamount in any venture whilst on the precipice of depression. But that’s neither here or there. What is important now, at this very moment, is what does this week’s action portend for the balance of 2023?

The Dow and SPY rose by 1.5% and the NASDAQ +0.9%. By all accounts, we should now be off to a splendid year.

How did I manage it?

RUEFULLY.

I am down for the year to the tune of 0.76%, mainly due to bad hedges, very sour indeud. Had I not chanced upon SOXS today, I’d be up 2%+. But we cannot and mustn’t cry like babies about spilt milk. If I were to do that, I’d cry myself to death. Let’s think about the future and how grim it might be, with all of those future layoffs and LESS THAN EXPECTED earnings results. And let’s not forget about the earnings and possible wars — and maybe even a Presidential funeral! We have so many great things ahead of us, so chin up if you shed a little this week — for the worm shall turn soon and when it does it will swallow the bulls whole.

Happy January 6th!

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PIVOTOORS ARE BACK

Big balled rally today, built upon the bones of those about to be buried.

Briefly, markets are rallying because the economy is in COLLAPSE MODE, as evidenced by today’s major ISM miss.

ISM contracted for the first time since 2020, coming in at 49.6 vs an estimate of 55. Immediately following this news, markets took off and haven’t look back since.

The US 10yr is down nearly 14bps because the market believes the Fed will need to PIVOT in order to stave off a Great Depression. In short, the pavlov effect is happening and traders are salivating from their mouths in the belief that the FOMC will save them.

The only problem with this theory is that it isn’t true. No one is coming to save you and the Fed cannot cut rates.

I will repeat.

THE FED CANNOT CUT RATES, so what are you getting all excited about?

Bottom line: My feeeeelings are that markets should crash and burn forever. However, I see the response to retarded news and realize not everyone is as smart and sophisticated as me. Ergo, I have a fully long book, which is hedged to my own detriment at the moment. I am merely +26bps thanks to a series of bad hedges. NEVERTHELESS, I remain steadfast in my belief in collapse and will pray to the Gods all afternoon in order to demand a crashing of the close to validate my beliefs, rooted in my own insecurities — likely because I grew up in the sewers and like to feeeeel right about things from time to time.

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THE JANUARY EFFECT GOING EXACTLY AS PLANNED

Markets closed near session lows, DOWN 155 NASDAQ — deservedly so.

Pray tell me, aside from your holdings — why should stocks go up? Why can’t they go lower — much much lower?

See, I am of the belief that the economy is SLOWING, as evidenced by massive job cuts at Amazon and CRM. I am also of the belief that this time, apparently so, the Fed isn’t coming to save you.

With that in mind and all other things, you know it and I know it — we are STEAMING towards perdition and nothing can stop this train from derailing and crashing into the ravine.

I traded +26bps today, Quant +44bps — because I am a professional.

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