Flying To Close To The Sun; iBankCoin Labs Issues Short Bias Heading into June

How checked out was everyone on Friday?

The weekend had already begun by the time US markets opened.  Americans, fat off economic gains in housing and retirement accounts (lolz), took out their chipped cards and headed out of the office.

A long weekend for the overworked masses. The best of times, right at the advent of summer.  Mating season in full swing, the mind wanders.

While all seems well on the surface, when you peel back one golden layer from this vidalia onion of a market you see rot. BEHOLD, sector performance last week:

If this data were our only basis for being short, then it may be a bit overzelous.  But there is more.  The infrequent but highly potent Rose Colored Sunglasses signal triggered in the often overlooked Exodus Strategy Session, a report so vital to iBC laboratory security that it is produced every single Sunday by any means necessary.

We will be selling in May.

Right at the end of it, after participating in the bountiful gains it provided.

For summer is upon us and investors are distracted by their summer homes and primal instincts.  The good scientists constantly return to their foundation stone—cold, dead, lifeless logic.  The kind of information that allows for objective decision making.

With any luck, when USA stock markets open Tuesday, they do so in a strong manner.  A gap up.  An early rally.

Or they begin plunging right off the rip.

Either way, and without a moment of doubt, cash will be raised and NASDAQ futures will be shorted at every official opportunity.  We only take official trades, no gun slinging.  This is science.

The results often resemble a Van Gogh painting, and some call our output art.  Which is fine. We know what it is.

Long term accounts, the stocks beautifully chosen by Exodus robots at the end of each quarter, will remain in place.

Everything else is subject to liquidation.

Nobody remembers the Great Recession, the pangs of austerity.  They hardly remember last June’s BREXIT vote.  We are collectively flying too close to the sun.  The Fed knows it, our data shows it, and now your good scientists have wrote it.  Do with this information what you see fit.

If I were you, thank goodness I am not, I would create my own quant model to empower my decisions.

Stay sharp out there and remember—the market is not rigged to get you.  It does not care how you are positioned or whatever else is happening in your microcosm.  It it simply a numeric representation of the net interactions of humans around the world.  NATURE.

Exodus Members, the 133rd Edition of Strategy Session is live.  See all the details of the short bias, and what would confirm the idea even more.  ENJOY!

NASDAQ futures are coming into Thursday gap up after an overnight session featuring elevated volume on normal range.  Price worked higher, to record highs, stalling in-and-around the Fibonacci extension levels drawn from last week’s down move.  At 8:30am Advance Goods/Trade balance came out below expectations.  At the same time Initial/Continuing jobless claims were worse than expected.

You know, economic data points…irrelevant matters. Investors are tunnel visioned on our new authoritarian leadership.

At 1pm, the US Treasury is auctioning off $28 billion in 7-year Notes.

Yesterday we printed a double distribution trend up.  Price opened gap up, sellers closed it, we established a bid around these prices, then we began auctioning higher for the rest of the day.

Heading into today my primary expectation is for sellers to press into the overnight inventory and close the gap down to 5731.  From here we continue lower, down through overnight low 5728.75.  Look for buyers down at 5718.50 and two way trade to ensue.

Hypo 2 stronger sellers work down to 5696.75 before two way trade.

Hypo 3 press up through overnight high 5759, trade up to 5770 before two way trade ensues.

Hypo 4 buyers sustain trade above 5770 setting up a trend up.

Levels:

Volume profiles, gaps, and measured moves:

Fibonacci extensions are one of the most useful measured levels in trading.  Real quick, here is how Investorpedia defines them, which is decent:

These extensions involve all levels drawn past the basic 100% level; they are frequently used by traders to determine areas that will bring in profits. One popular extension, the 161.8% level, is used to set a price target on a breakout of an ascending triangle; this target is calculated by multiplying the vertical distance of the triangle by key Fibonacci ratio 61.8%, and then adding the result to the triangle’s upper resistance level.

Forget all that ascending triangle talk, that’s technical analysis guff.  A Fib extension shapes the narrative of a breakout.  Right now, in the NASDAQ, we have no market profile levels, the most logical trading levels in the world, to work with.  All we have are measured moves.

The Fib extensions in play right now are measured using the selling that occurred last week.  Below on the NASDAQ, you can see the measurement from peak-to-trough, and the subsiquent Fib-extension above current prices.  See below:

We moved up into these levels overnight.  Algorithms love to probe Fib extensions, looking to run stops.  Like if anyone initiated shorts into the down move, or somewhere during the retracement of it, then robots press into the move to see if these sellers really mean business, or if they’re going to stop out.

So our primary expectation on the first touch of the fib levels is for them to behave as resistance (in this case, since we reversed and extended a down move, the opposite ‘behave as support’ if we flipped the idea over). If instead we trade through the levels, and sustain price above them, it tells us this is much more than a stop run.

It could be the start of something much bigger.

And now you know everything you need to about Fibonacci extensions.

UPDATE: There was a local TV crew present when Gianforte body slammed Ben Jacobs.  There’s audio, and it’s sooo good:

Greg Gianforte is a gun nut running for congress out in Montana.  Typically the congressional race in this flyover state gets very little attention, but this is a special election after President Trump tapped Rep. Ryan Zinke to be secretary of the interior.  And perhaps Greg, who is also an amateur wrestler, was alarmed to see east-coast press show up at his Wednesday event.  So alarmed, he allegedly body slammed a journalist:

Greg Gianforte just body slammed me and broke my glasses

— Ben Jacobs (@Bencjacobs) May 24, 2017

Jacobs can be heard asking about the healthcare bill on the audio track.  The conservatives are touchy about that one.

A colleague of Ben Jacobs witnessed the ultra-violent scene of an old white man allegedly going ballistic and deploying a body slam, which is a popular wrestling move.  She shared her observations of the attack live on Twitter:

All of a sudden I heard a giant crash and saw Ben's feet fly in the air as he hit the floor

— Alexis Levinson (@alexis_levinson) May 24, 2017

This aggression will not stand.  Police are on the scene, you know what I mean? Taking statements:

Ambulance, sheriff, fire department at Greg Gianforte's event, where a Guardian reporter was allegedly body slammed by Gianforte pic.twitter.com/bty4EAVSHh

— Blake Montgomery (@blakersdozen) May 24, 2017

Whatever happened, Gianforte got the hell out of dodge, abandoning his event entirely:

Gianforte just left. The event was supposed to end an hour and fifteen minutes from now. pic.twitter.com/2lvWocJQ81

— Blake Montgomery (@blakersdozen) May 24, 2017

Greg Gianforte is facing off against Democratic populist Rob Quist, who also plays a banjo and writes nice songs about America.  He’s a real good Montana boy.  Whether or not Rob wins the special election is not materially important for the House, which will still be dominated by red-blooded Republitards, but it could give some energy to an otherwise dazed and confused Democratic party.

While this story is still developing, Greg’s wrestling moves may have done a solid favor his rivals on the left.

NASDAQ futures are coming into Wednesday gap up after an overnight session featuring normal range and volume.  Price worked higher in an unobstructed, linear manner overnight while our President continued his international tour of holy lands.  At 7am MBA Mortgage applications came out better than last week.

We have a busy economic calendar for Wednesday.  Existing Home Sales at 10am, crude oil inventories at 10:30am, 2-year Note auction at 11:30am, a 5-year Note auction at 1pm.  Most importantly, we have FOMC Minutes from the May 3rd meeting at 2pm.

And while it’s likely to be ignored by investors, The Fed’s ‘crazy-eyed’ Kashkari is speaking in Wisconsin at 6:30pm.

Yesterday we printed a normal variation down.  Price opened gap up and quickly drove lower, closing the gap.  Sellers then backed off, and two way trade ensued along the top-side of Monday’s range.

Heading into today my primary expectation is for an early push higher.  There’s an open gap at 5724.75 that was left behind last Wednesday when the democrats thought they had some real obstruction of justice dirt on our wall-loving President.  We have returned to the ‘scene of the crime’.  Look for price to continue higher, up to 5754 before two way trade ensues.

Hypo 2 sellers press into the overnight inventory and close the gap down to 5712 then continue lower, down through overnight low 5705.25.  Look for buyers down at 5700 and two way trade to ensue ahead of FOMC minuets.

Hypo 3 a probe above all-time highs 5727.25 finds strong sellers and we are thrown into two-way trade ahead of FOMC minutes.

Levels:

Volume profiles, gaps, and measured moves:

The very talented Maria Bartiromo sent out a tweet Tuesday evening saying she  ‘stands w @seanhannity’ which is Twitter shorthand for she is ready to go to war alongside her comrade-in-media. Look:

@seanhannity I stand w @seanhannity stop the madness @FoxNews @FoxBusiness @MorningsMaria ridiculous. Start focusing on the agenda #taxreform

— Maria Bartiromo (@MariaBartiromo) May 24, 2017

She was replying to a tweet from Hannity, where he made it publicly known that the censors at Media Matters were working the phones and eating lunches, you know real hard work, doing all they can to urge his clients to stop advertising during his programming.  Truly, check it out:

IMPORTANT! Mediamatters is trying to silence me, get me fired, pressure my advertising on radio & TV. Liberal Fascism. I need your help!!

— Sean Hannity (@seanhannity) May 23, 2017

Maria Bartiromo used to be one the greats over at CNBC.  That title has since been passed onto Kayla Tausche.  Nowadays she gets exclusive interviews with President Trump where she sits on the edge of her seat, nearly giddy about bomb and cake gossip:

Maria also retweeted Paul Joseph Watson Tuesday night.  He is a writer for InfoWars and YouTube sensation known for ‘red pilling’ his viewers in a charming english accent.  This is very non-MSM of her.  Downright brazen, for a woman of her profession to retweet something spoken by PJW.  He has been labeled a villain in her industry.

UPDATE: Sean Hannity announced he will back off the Seth Rich conspiracy theory for a bit during his Tuesday evening program.

Sean Hannity is coming under file because he offered his platform to Kim Dotcom, an eccentric hacker and enemy of Hollywood, who says he has proof Seth Rich was a Wikileaks informant.  If the claims of Dotcom turn out to be true, it will make most media folks look real bad for pressing the Russian collusion narrative so hard for the last six months.  Therefore they appear to be very against any Seth Rich talk.

With Bartiromo siding with alternative media, this entire Russia/Rich/DNC/Wikileaks fiasco has taking an interesting turn.  As the Dotcom story continues to develop, it will become more evident if Maria is on the right side of history.

As always, TBD.

NASDAQ futures are coming into Monday with a slight gap up after an overnight session featuring normal range and volume.  Price worked sideways overnight in a stable manner, holding inside last Friday’s range.

The economic calendar is light today.  We only have to be aware of the 3- and 6-month T-bill auctions at 11:30am.  Also, a reminder, there are FOMC Minutes out Wednesday afternoon.

Last week US markets worked higher through Tuesday before liquidating hard ahead of the Wednesday open, based off politics.  The selling continued through all of Wednesday, then we spent the rest of the week working back up-and-into the news driven move.  The last week performance of each major index is shown below:

On Friday the NASDAQ printed a normal variation up.  The day began with a gap up and a small drive higher before 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 5635.50 then continues lower, down through overnight low 5648.75 and continuing lower, down to close the gap at 5629.50 before two way trade ensues.

Hypo 2 buyers work up through overnight high 5665.25 and slowly work higher, up to 5700 before two way trade ensues.

Hypo 3 strong sellers press a liquidation down to 5563.50 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

Greetings from America’s fertile crescent!

After a morning spent toiling away in the laboratory, it is will a sense of relief that we observe the latest results of the Index Model, which has flipped back to neutral after two weeks of bullish signalling.

Despite the precipitous fall in market prices last Wednesday, having a long bias has served our team well.  We pressed our longs and were rewarded.  Interestingly enough, there were subtle cues before the Wednesday liquidation to start working the other side of the tape.

If your inputs are objective and logical, you can confidently switch your bias in the heat of the action.

Hypo 3 morphs into primary hypo PLUS were neutral aka intra day sell opportunities #nq_f https://t.co/jWjGqB9aEe

— RAUL (@IndexModel) May 16, 2017

All of the planning that goes into my approach—the Sunday Strategy Sessions, the morning reports, Switchboard—is what allows me to trade well.  By doing my homework in public forum, it is my hope that something about what we do can make sense to someone starting out.  Like a nudge in the direction of what works for me.

There is so much garbage out there about trading.  So many people are basing their decisions on news reports or worse, gut instinct.

Every opportunity taken by the good folks of iBankCoin laboratory is decided by the algorithms inside Exodus and the scores generated by the Index Model.

With that being said, and heading into the last full week of May, we may raise some cash.  There are no clear bearish signals being offered.  However, June is the most bearish month of the year, per the $QQQ, see below:

Pair the upcoming seasonality with some of the bearish undertones noted in the 132nd Edition of Strategy Session (Exodus members, it is live now, go check it out) and you have a logical reason to raise a bit of cash.

When and how we shall do so, as always, is TBD.

There are FOMC Minutes out Wednesday afternoon.  Perhaps the reaction to this economic event will help to tilt the debate of whether or not to sell IN May.

NASDAQ futures came into Wednesday flat after an overnight session featuring elevated range and volume.  Price worked lower and our current swing low, just above a gap left behind on April 26th, occurred during extended trading hours, this is contextually bearish.

Market profiles are ugly, which means day-trading opportunities are elevated, and also means the higher time frame is interacting with the markets.  Key /NQ_F Levels, and ugly profiles [out-of-balance] are pictured below:

We had some economic statistics this morning.  What’s interesting about an out-of-balance market is economic non-events like Initial/Continuing Jobless claims, which haven’t moved the market for months, suddenly impact prices. Both Philly Fed and Initial/Continuing claims were better-than-expected and the market rallied shortly after.

We have a ‘news driven’ framework to trade around, given that the overall consensus among investors is that the selling seen all day Wednesday was attributed to the actions being taken by U.S. Intelligence Agencies and the White House.  Our primary expectation is for the market to ‘return to the scene of the crime’ or check back to where the initial reaction occurred.

The scene of the crime gap, volume profiles, and measured moves are pictured below:

Part of what goes into my daily planning is what I call Switchboard.  It is my ‘all things considered’ spreadsheet, which takes everything discussed above, and as objectively as possible codes it into a trading bias.

Considering everything discussed above, Switchboard is currently neutral. See below:

You may notice the June Fed Rate decision is already on our radar.  Per the CME Fed futures, there is currently a 64.6% chance of a 25 basis points rate hike on June 14th, see below:

Heading into the afternoon and evening, my primary expectation is for this ugly profile to start taking shape, with value around 5605.  Looking to buy below and sell above, working the neutral bias until more information is made available.

Remember we’re talking NASDAQ futures, June expiry.

Trade’em’well

NASDAQ futures are coming into Wednesday gap down after an overnight session featuring extreme volume on elevated range.  All the upside achieved Monday/Tuesday was reversed during extended trade before two way trade ensued.  At 7am the MBA Mortgage applications data was worse than last week.

Also on the economic agenda today we have crude oil inventories at 10:30am.  Also, at 11am the New York Fed will release its Household Debt and Credit report.  This report will likely contain major implications of a June rate hike.

Investors are currently pricing in a 69.2% probability of a rate hike on June 14th, according the CME’s Fed Fund futures.

Yesterday we printed a neutral extreme up.  Price worked lower early on, closing the overnight gap reversing and traversing the entire daily range and going range extension up.  Buyers then added a bit more near the end of the day.

Heading into today my primary expectation is for a gap-and-go lower, down to 5676 before two way trade ensues.

Hypo 2 strong selling pushes down through 5670, setting up a move to 5659.50 before two way trade ensues.

Hypo 3 buyers work into the overnight inventory and close the gap up to 5724.75 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves: