Last week was about punishing the people too lazy to do research who just allocate capital on the first day of the quarter, every quarter, like a wind up doll that is cranked by sales people. It was also full of distraction and noise. Unless you tuned out politics and kept your inputs simple and raw. Like a vegan who only eats food locally sourced, but brain food. The indexmodel relies on raw data and generated a bearish call last week. That was all we needed to mint coin during week one of the fourth quarter. You are only as good as your last trade I suppose. If that is the case, my cock and beard are both strong coming into week two. There are several reasons to be bullish heading into week two.
The PHLX semiconductor index and NASDAQ transportation index both have charts that, technically speaking, look bullish. Allow me to state that I do not prefer technical analysis, but it merits our attention because sometimes it works. Most of the time it is just fodder to appease the minds of trigger happy degenerates who are addicted to gambling. But if you keep it simple and buy at old resistance and sell at old support, and also use the charts to determine if a market is trending [discovering] or not, then it can be useful. These charts are both simple and bullish:
Next we have Exodus flagging hybrid oversold. I only mention this on public blog because Senor Tropicana, as he’s known in South America, already let the cat out of the proverbial bag last week. This bullish cycle began at close of business Thursday, October 4th and will run clean through to close of business Thursday, October 18th.
Why else am I bullish? Why else…well, I think people are in general good and sapiens continue to be the most successful species on earth. Sapiens and cockroaches. While evil has and will continue to manifest itself in different forms, like the industrial meat complex or dimwitted news folk like Charles Gasparino, the powers of good will always prevail. Sometimes it seems like we are past the point of no return, but then new hope flickers in a small corner of the world and begins to grow into an almighty light, like Elon Musk.
For the reasons stated above I am bullish going into the second week of the fourth quarter. This means I will only be working the long side of the market inside the NASDAQ 100 futures arena and pressing a position trade via TQQQ that I initiated late Friday afternoon as part of my ‘two-point conversion’ play after scoring a huge touch town last week. I actually made my quarterly income goal last week. I suppose the bar was set too low. In any case, overconfidence is the biggest risk to my plan, I will need to do some proactive exercises to manage it—like go outside and dig a hole or have a women tie me to a table and beat me or something.
Winter is coming. There were some interesting behavioral quirks last week that suggest people are preparing to hunker down and play it safe. Maybe the way the Fed removed of a few bits of accommodating language from their last statement, or their the continued campaign of slowly lifting borrowing rates has been enough to calm down the animal spirits that have taken to buying over-sized houses and self-destructing artwork. It always amuses me how quickly people can forget about the hard times when the good times return.
Stay grounded. What we need is a good recession but it doesn’t seem likely. Not with semiconductors leading our current expansion. Unless you’re a bond company stooge, we have a full work week ahead of us. Let’s take it one day at a time and if the bulls run we will too.
Exodus members, the 203rd edition of Strategy Session is live. Go check it out for a less colorful look at what we expect to see this week!
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