Thursday, May 5, 2016
I turn dials and fiddle with knobs to hone in on harmonic rotations
Joined Oct 26, 2011
2,393 Blog Posts

The NASDAQ Looks Like A Mexican Standoff

mexistand

NASDAQ futures are starting the morning out gap up after an overnight session featuring normal range and volume.  Price worked higher through most of Globex before finding sellers at the same level as yesterday’s Globex session–near Tuesday’s value area high.  At 8:30am Initial/Continuing Jobless claims data came out better than expected.  The initial reaction is muted.  Investors are likely waiting to hear tomorrow morning’s Non-farm Payroll report before reacting, especially with our current auction context (see blog title).

There are no other scheduled economic events today.

Yesterday we printed a normal variation down.  A brief attempt at working higher to close the gap down was thwarted when sellers stepped in.  Price then worked lower, slowly and methodically, to take out last Friday’s low (swing low) briefly before price was bid back up into our short term balance (see blog title).

Heading into today my primary expectation is for chop.  Look for sellers to work into the overnight inventory and close the gap down to 4309.25 before finding responsive buyers and two way trade ensuing south of 4330.

Hypo 2 buyers work higher off the open and close Tuesday gap up at 4335.25.  Buyers continue higher and take out overnight high 4342.50.  Look for responsive sellers up at 4343 and two way trade to ensue.

Hypo 3 sellers work down through the gap fill, below 4309.25 setting up a move to test the 4300 century mark.  Look for two-way trade to ensue

Hypo 4 liquidation snap.  Price breaks down through 4300 sending the market down to 4275.75 before two way trade ensues.

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Levels:

05052016_NQ_MP

Volume profiles, gaps, and measured moves:

05052016_NQ_VPgapsMeasuredMoves

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Fitbit Trips and Falls Off A Cliff After Hours

fallingfitbit

Fitbit shares are crashing after hours after slashing forward guidance.  First quarter numbers beat on top and bottom line; EPS came in at $0.05 vs $0.03 estimate and revenues were $505.4M vs $443M estimate.

Shares are being demolished because the realization that everyone who was going to buy a Fitbit already has.  They only expect Q2 revenues of a paltry $565 million.

The market for wearables is mature and the moat separating competitors from grabbing market share is less secure than the Mexican border.

FIT shares were already off to a wretched performance to start the year, down more than -40% year-to-date:

fit-chart

It appears shareholders are in for another slippery quarter.

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Tesla Just Crushed Earnings

Tesla stores, like this one in Miami, sell cars directly to customers, bypassing dealerships. Tesla has had to fight to keep its stores open in some locations, most recently in New Jersey.

Tesla loss per share came in one penny less than expected, EPS $(0.57) vs $(0.58) estimate.

Shares are ripping after hours after the company affirmed their fiscal year 2016 delivery guidance of 80-90k vehicles.

Q1 deliveries we 14,81k.

The company is growing because rich people are sick of the bullshit they’re forced to put up with when it comes to oil and gas.  Once they price a car into the millennial’s budget, growth trajectory will take on the proverbial hockey stick shape.  Millennials hate cars, choosing instead to spend money on smart phones and Uber.  But they will buy Tesla cars.

Watch.

 

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Rumor Spikes GOGO: Delta To Increase Commitment

airlinefinger

Delta is making waves again today as rumors circulate the company may increase their commitment to in-sky internet provider GOGO.  The whispers spiked $GOGO to a fresh high for the month of May before getting knocked back.

The flimsy, sky mall version of internet is set to report earnings May 6th, but we could see a nice run on this rumor before then.

The stock is down at all time lows heading into earnings.

gogo-05042016

Maybe the gamblers at Delta can save Gogo and their lame business of providing expensive internet that Southwest gives you for free.

See Also: New Delta CEO is Going Hedgeless on Oil

 

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Tesla VP of Manufacturing Jumps Ship Ahead of Model 3 Ramp

eloNSPACE

Shares of Tesla are down nearly 4% on the session after Bloomberg reported Greg Reichow, one of their highest paid executives, is leaving the company.  The company is set to report after hours.

TSLAdaily-05402016

When disruption is vital only meritocracy will be tolerated.  Perhaps Greg cracked under the pressure of Elon Musk.  This Greg fellow is to be ignored going forward.  Consider his departure just another speed bump on the road toward autonomous-electric cars and saying, “fuck your coal plants, I’m going off the grid.”

Manufacturing design is not rocket science, just a ton of work.

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Futures Continue To Probe Lower in Desperate Attempt To Find Buyers

carforsale

NASDAQ futures are coming into Wednesday gap down after an overnight session featuring an elevated range on normal volume.  A balanced session fave way to selling around 4am sending price down near last month’s lows.  At 8:15am ADP Employment came in below expectations.  Also at 8:30am Trade Balance data was slightly better than expected.

Also on the economic docket today we have Factory/Durable Goods Orders and Non-Manufacturing/Services Composite at 10am.  At 10:30am we will hear the crude oil build up numbers.

Yesterday we printed a normal variation up.  Price opened gap down and an early attempt to fill it was swiftly rejected around 4350 by sellers.  Sellers struggled to become initiative, however, and buyers pushed a low-volume range extension up.  This was faded back down into balance in the afternoon.

Heading into today my primary expectation is for sellers to probe the lows.  Look for overnight low 4299.25 to be taken out early on and a test down to 4292.75 where buyers step in and two way trade ensues below 4310.

Hypo 2 gap-and-go trend day down.  Sellers take out 4292.75 early on and sustain trade below it setting up a move down to 4281.75.  Sellers continue working lower to target the open gap down at 4275.75 before two way trade ensues.

Hypo 3 responsive buyers step in and work into the overnight inventory.  They work higher but stall before the overnight gap, finding sellers up at 4325.50 before two way trade ensues.

Hypo 4 full gap fill up to 4335.25 then a continued move up to 4343 before two way trade ensues.

Levels:

05042016_NQ_MP

Volume profiles, gaps, and measured moves:

05042016_NQ_VPgapsMeasuredMoves

 

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Longs Liquidated in Thin Overnight Session

roddyroddy

NASDAQ futures are coming into Tuesday gap down after an overnight session featuring an elevated range on normal volume.  Price held upper value for a portion of the evening before sellers pushed into the market and retraced the entire low-volume rally from yesterday’s cash session before coming into balance near Monday’s opening print.  The resulting profile resembled a lowercase b–the type of profile we typically see during a long liquidation.

Long liquidations are often temporary phenomena driven by triggering stop orders.

On the economic docket today we have a 4-week T-bill auction at 11:30am.

Yesterday we printed a normal variation up.  Price opened gap up and the market found buyers just after the gap was filled.  The rest of the morning featured a tight range.  Just after lunchtime buyers became initiative and pushed the market higher, stalling just ahead of the 04/28 gap at 4382.75.

Heading into today my primary expectatino is for buyers to push into the overnight inventory and work price up to 4350.  Look for sellers to defend here and set their sights on overnight low 4331.  Look for responsive buyers down at 4321.75 and two way trade to ensue.

Hypo 2 strong buyers push up through 4350 and sustain trade above it, triggering a pole climb to close overnight gap up to 4369.50.  Buyers then take out overnight high 4374.50.  Look for responsive sellers up at 4371.75 before two way trade ensues.

Hypo 3 sellers work a gap-and-go lower, take out overnight low 4331 early on.  Look for responsive buyers down at 4318.25 and two way trade to ensue.

Levels:

05032016_NQ_MP

Volume profiles, gaps, and measured moves:

05032016_NQ_VPgapsMeasuredMoves

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May Comes in Like A Lamb

lambby

NASDAQ futures are heading into the new month gap up after an overnight session featuring normal range and volume.  Price held last Friday’s range on a balanced session and is approaching session high as US open approaches.

On the economic calendar today we have ISM Manufacturing at 10am.  Also both the 3- and 6-month T-bills will be auctioned at 11:30am.

Last week price worked lower.  Wednesday featured a pro gap down, and Thursday’s attempt to fill it was rejected–continuing the descent lower.  Friday morning featured selling, but by lunchtime the market was in balance and two way trade ensued.

Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 4335.50.  Look for buyers to defend around here then work higher to target overnight high 4344.25.  Look for responsive sellers up at 4368 before two way trade ensues.

Hypo 2 buyers gap and go higher, take out overnight high 4344.25 early then sustain trade above 4368 setting up a move to target 4387.25 before two way trade ensues.

Hypo 3 sellers close overnight gap down to 4335.50 then take out overnight low 4318.  They continue lower to target the 4300 century mark.  Look for buyers down at 4293 and two way trade to ensue.

Levels:

05022016_NQ_MP

Volume profiles, gaps, and measured moves:

05022016_NQ_VPgapsMeasuredMoves

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May Is Coming For You

lakeOOOOOOfire

All of our worst fears will materialize in May.  Lawns, inundated with dandi-lions and grubs.  Biker gangs, lawn-jobbing the soft turf.  Grass clippings, filling sinus cavities, swelling faces into amorphous balloons.

Spring brought the out the heathen speculator, and nature intends to make a correction to the economic tilt benefiting stock pickers.  It would behoove you to load up on gold bricks, allergy pills, and dry foods.  Then, from the safety of your air-tight shelter, attend the Investor Boot Camp in May.  Unlike other investor conferences, no human or elemental contact is necessary.  You can elevate your game from the safety of your shelter, away from the deadly germs, viruses, and allergies.

See Also: Deadly Zika Virus Claims Life in Puerto Rico

You have, all of you have, perhaps 3-4 days to flee the stocked market and board the ark.  Then, my best guess, is all hell breaks loose.

Welcome to May.

Distinguished members of Exodus, the latest Exodus Strategy Session, my 76th iteration, has been published.  Be sure to check it out.  Questions will be answered in the order they are received. Cheers!

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Deadly Zika Virus Claims Life in Puerto Rico; Intrexon Spikes Higher $XON

mosquitoseek

The Zika virus is officially killing people on American soil.  Friday afternoon the CDC reported 1 death from the Zika virus and 683 cases of infection in Puerto Rico.

The morbid news briefly spiked Intrexon shares higher.  The company has proposed using their genetically engineered mosquitoes to combat the festering tropical crisis.

See Also: Genetically Modified Mosquitoes Are Safe, But Test Them on Floridians Just in Case

Intrexon shares have been under pressure since April 21st when reports showed Key West residents are resisting plans to release thousands of GMO mosquitoes onto the southern island.  Perhaps now, seeing these bloodthirsty creatures taking lives, Floridians will allow the company to go ahead with their biological warfare.

Bottom line: the mosquito is a disease spreading pestilence.  Draconian methods have been used for 100s of years to combat the spineless bastards.  Now something more sophisticated exists and everyone plays the ignorant paranoia card against it.  They need to be corrected, completely and entirely-the residents and the mosquitoes.

Any disruption to the ecosystem will be adderssed when the necessity arises.  For now, eliminate the Zika carrying monsters.

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