iBankCoin
I turn dials and fiddle with knobs to hone in on harmonic rotations
Joined Oct 26, 2011
3,534 Blog Posts

Raul says stay cool

Models are updated and back to neutral after flipping bullish last Sunday.  Strong ‘Hybrid Chg %’ numbers drop off on Monday which gives bears an edge heading into the week.  Trade wars are running hot, and my opinion is that they are going great but what do I know about the macroeconomic picture? Nothing and neither does anyone else.  If anyone claims on the CNBC entertainment news channel to know how the global economies levers work, they are a liar.

The Federal Reserve doesn’t even know.  They’re losing their might, believe it or not.  The power of the hash has manifested.  The whole archaic notion of money backed by nation states has been called into question.  There is no backing to the money besides military might.  Which I suppose is nothing to sneeze at.  If the military wants to make you dead—they will.

But they cannot make to kill bitcoin.  Which is nice, because maybe bitcoin will make to kill them.

Moving on from fantasies of anarchy…

Lots of my favorite twitter trader accounts seemed on tilt last week.  There was a vibe of confusion—what with the rate cut introducing heavy selling, the new month flows erasing said selling, only to have a trade negotiation tweet from President Trump re-erase the erase-ment.  Admittedly, it was a lot to digest.  I was watching from afar, having committed to some side work instead of grinding out trades.  And maybe I am sitting on a cloud thinking I am a better investor and trader than most, I don’t know maybe I am or maybe I am just a jerk—but this is my advice to anyone who felt a little rattled by last week’s action:

There is always another bus

If you start to feel off, or like your actions are based on emotion and not focused execution of your plan, the first step is to STOP.

This is often done most easily by removing your body from your desk.  Outside work or home chores are helpful if you need a distraction.  If you feel an itch or urge to take action because you catch a chart or news bit on your phone or some screen in the corner of your eye, put a wider space between you and the markets.

If you have a plan in place and feel calm and clear about what needs to be done, then re-engage.  You likely need to reduce size given the increase in volatility.  Be sure to keep track of how you feel.

The stock market was here long before us and will continue to function long after we are gone.  Just like buses in the city, there is always another trade coming.  Make sure your account is still liquid so you are ready when that next opportunity comes.

Anyways, it is nearly 1pm New York on this lovely Sunday and I need to go wrestle some iron up and down a few 50-60 times because if not I will want to make to kill.  Why is my base instinct so violent?   We don’t know.  Raul says stay cool.

Raul Santos, August 4th, 2019

Exodus members, the 246th edition of Strategy Session is live, you need to see what is going on in the NASDAQ transportation index, check out Section IV!

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First Friday in August, summer FOMO in play, here’s the Friday NASDAQ trading plan

NASDAQ futures are coming into Friday down a quick -60 after an overnight session featuring extreme range and volume.  Price was balanced for most of the night, chopping along Thursday’s low before breaking lower at 8:30am after the Non-farm payroll data came out in-line with expectations (May/June jobs added revised lower by a combined 40k).  As we approach cash open, price is hovering below Thursday’s low.

Also on the economic calendar today we have factory orders and University of Michigan final July reading of sentiment at 10am.

Yesterday we printed a neutral extreme down.  The day began with a slight gap up and drive higher.  By late morning the entire post-FOMC rate decision sell-off had been erased.  We inched higher before noon, pressing range extension up and closing the gap left open between Monday and Tuesday. During New York lunch, President Donald Trump tweeted that trade talks had failed and this caused a major sell-off:

The news-driven move saw price take out the Thursday low before we came into a choppy balance.  We ended the day near session low.

Neutral extreme down with a news driven aspect.

Heading into today my primary expectation is for buyers to work into the overnight inventory and test Thursday low 7776.75.  Sellers reject a move back into Thursday’s range and we take out overnight low 7724.50.  Look for buyers down at 7706 and two way trade to ensue.

Hypo 2 stronger sellers drive lower off the open, sustain trade below 7700 setting up a move to target 7668.25 before two way trade ensues.

Hypo 3 buyers regain Thursday low 7776.75 and sustain trade above it setting up a full gap fill up to 7805.  Buyers continue higher, taking out overnight high 7826.75.  Look for sellers up at 7842.25 and two way trade to ensue.

Levels:

Volume profiles, gaps, and measured moves:

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Last Monday in July, NASDAQ near record high, pause, here’s the trading plan

NASDAQ futures are coming into Monday with a slight gap up after an overnight session featuring normal range on elevated volume.  Price worked sideways overnight, chopping along inside the Friday range.  As we approach cash open, price is hovering near the Friday high.

On the economic calendar today we have 3- and 6-month T-bill auctions at 11:30am.

Last week featured a rally across the board, except for the Dow.  We pretty much rallied all week while the Dow marked time.  Here is the last week performance of each major index:

On Friday the NASDAQ printed a normal variation up.  The day began with a gap up and push higher which stalled just a few points below record highs.  Sellers faded the move through late morning but were unable to press range extension down.  Instead buyers came back in and initiated higher prices, trading higher but not exceeding record high before some late-late afternoon selling back to the midpoint.

Heading into today my primary expectation is for sellers to press into the overnight inventory and close the gap down to 8017.50.  From here we continue lower, down through overnight low 8002 to tag the 8000 century mark before two way trade ensues.

Hypo 2 buyers work up through overnight high 8031.75 setting up a move to target 8050 before two way trade ensues.

Hypo 3 stronger buyers trigger a rally up to the 8100 century mark before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

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100% odds of a Fed rate cut, the greatest illusion ever, still bullish

Strategy session is complete.  Models are updated and bullish. I have a grasp on what could move the markets in the upcoming week.

Apple reports earnings Tuesday after-market-close.  They are an organization I still respectfully monitor, especially they’re product events and earnings calls, both which move the NASDAQ.

The Federal Reserve is hard to respect, but I do, just like the U.S. government.  The grande illusion.  What a pathetic attempt to remain in power, truly.  The gambling halls in Chicago, aka the Mercantile Exchange, are currently placing odds at 100% for a rate cut this Wednesday.  80% odds of a 25 basis points cut.  20% odds of 50 basis points.

Meanwhile there is more real estate development happening now then there was pre-Great Recession, the stock market is at all-time highs, and you know, things are just all around way too strong but hey, yeah cut rates.

We need to hike rates.  The devil knows that juggernaut of bleak corporate existence in downtown Detroit, where they HEY, they gamify the lives of thousands of sad humans who are anchored to auto-dialers for 6-7 days of selling mortgages, SELL THOSE DEATH CONTRACTS, fuck all of them, we know they’re doing better than ever.  Selling a lie of the American Dream.

Thank you for reading my rant.

None of it matters.

Because bless the hearts and minds of these crypto-anarchists they’ve done it lads.  They’ve actually come up with a way to derail this whole notion of nation states and corporate surveillance.  There is not much to do now.  Play the game, accumulate fiat cash and convert it as quickly as you can into land that won’t wash away with climate change, solar panels and wind wheels, and crypto currency.  The whole shit house will be up in flames again soon enough.

Anyways the Fed is the Fed, a political arm like any other.  Goodness do I miss Janet Yellen.

That’s all I have to say on this final July Sunday.  Now I must return to building a wall to keep these mortgage jockeys off my lawn.

RAUL SANTOS, July 28th, 2019

Exodus members, the 245th edition of Strategy Session is live, go read about semiconductors—an honest and meaningful industry.

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Strong GDP data blows through, here’s the Friday NASDAQ trading plan

NASDAQ futures are coming into Friday gap up after an overnight session featuring extreme volume on elevated range.  Price worked higher overnight, trading up through the Thursday range before coming into balance.  At 8:30am GDP data came out much stronger than expected, quarter-over-quarter, Q2 annualized, the U.S. economy grew at 2.1% vs. 1.8% expectations.  As we approach cash open, price is hovering along the Thursday high.

Google and Amazon reported earnings after the bell Thursday.  Between the two we have a net-positive movement—Google is +8.5% in pre-market and Amazon is -1.5%.

There are no other economic events today.

Yesterday we printed a normal variation down.  The day began with a gap down and drive lower.  Responsive buyers were seen ahead of the Wednesday low.  Price moved back up to the daily midpoint where sellers were seen defending before pressing the market range extension down.  Price bounced along the lows before the earnings spike at settlement which spiked lower, then ultimately higher to close the day near session high but not neutral.

Heading into today my primary expectation is for buyers to press up through overnight high 8021.75.  Look for sellers up at 8027 and two way trade to ensue.

Hypo 2 sellers press into the overnight inventory and close the gap down to 7979.25 then continue down through overnight low 7977.  Look for buyers down at 7971.25 and two way trade to ensue.

Hypo 3 stronger buyers sustain trade above 8027.50 setting up a move to close the open gap up at 8037 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

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NASDAQ up near ATH amid major tech earnings, day after trend day ;-) here’s the Thursday trading plan

NASDAQ futures are coming into Thursday with a slight gap down after an overnight session featuring elevated volume and normal range.  Price was balanced overnight, balancing along the upper-half of Wednesday’s range for the entire Globex session.  At 8:30am durable goods, advance goods trades balance and initial/continuing jobless claims data came out better-than-expected.  As we approach cash open, price is hovering in the upper quadrant of Wednesday’s range.

Major NASDAQ mover Facebook reported earnings last night.  $FB shares are +1.5% in pre-market trading.

Also on the economic calendar today we have 4- and 8-week T-bill auctions at 11:30am followed by a 7-year Note auction at 1pm.

After the bell today we have earnings from Google and Amazon.  These are very likely to be NASDAQ movers.

Yesterday we printed a trend up.  The day began with a gap down that buyers quickly drove higher at the open.  After closing the overnight gap there was a bit of consolidation/energy build before a second strong leg higher in the afternoon which was accented during settlement by strong earnings reports.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 8037.  From here we continue higher, up thorough all-time high 8051.75 before two way trade ensues.

Hypo 2 stronger buyers drive up to the 8100 century mark before two way trade ensues.

Hypo 3 sellers press down through overnight low 8000.75 setting up a move to target 7975.50 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

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Washington DC noise, Facebook earnings after the bell, here’s the Wednesday NASDAQ trading plan

NASDAQ futures are coming into Wednesday gap down after an overnight session featuring extreme range and volume.  Price worked lower overnight, erasing about half of Tuesday’s rally before coming into balance.  Robert Mueller is back in Washington DC, testifying, but the markets do not appear to be affected.  As we approach cash open, price is chopping along Tuesday’s midpoint.

On the economic calendar today we have Markit manufacturing/service/composite PMI data at 9:45am, new home sales at 10am, crude oil inventories at 10:30am, a 2-year note auction at 11:30am, and a 5-year note auction at 1pm.

Major tech juggernaut and new money creator Facebook is set to report earnings after the bell.  This is likely to be a NASDAQ-mover.

Yesterday we printed a neutral extreme up.  The day began with a gap up beyond the Monday range that sellers quickly drove down into.  Sellers closed the overnight gap before discovering responsive buyers (responsive relative to Tuesday’s open, initiative relative to Monday’s close).  Price chopped along, below the midpoint for most of the morning before going range extension down by a few points.  This formed a sharp excessive low and ushered in strong buyers for the rest of the afternoon who eventually pushed us neutral then continued to make a new 5-day high.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 7983.75.  This sets up a move to tag 7998 before two way trade ensues.

Hypo 2 stronger buyers tag 8000 and sustain trade above it, setting up a fresh all-time high and open air rally.

Hypo 3 sellers press down through overnight low 7925.25 and continue lower, trading down to the 7900 century mark before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

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NASDAQ near last Friday’s high, here is the Tuesday trading plan

NASDAQ futures are coming into Tuesday gap up after an overnight session featuring elevated range on elevated volume.  Price worked higher overnight after being in balance until about 3am.  As we approach cash open, price is hovering near last Friday’s high.

On the economic calendar today we have existing home sales at 10am followed by a two year note auction at 1pm.

Yesterday we printed a normal variation up.  The day began with a gap up and push higher to tag the naked volume point of control from last Friday.  Initiative buyers were then seen defending the 7900 century mark which set up a second rotation higher, closing the market near session high and overall printing an ‘inside day’ with price being contained inside of the prior session’s range.

Heading into today my primary expectation is for buyers to gap-and-go higher, trading up through last Friday’s high 7974.25.  Look for sellers up at 7983.75 and two way trade to ensue.

Hypo 2 stronger buyers rally up through 8000 and continue to explore all-time highs.

Hypo 3 sellers press into the overnight inventory and close the gap down to 7926.50 before continuing lower, down through overnight low 7921.25.  Look for buyers just below at 7917.50 and two way trade to ensue.

Levels:

Volume profiles, gaps, and measured moves:

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NASDAQ begins the week up a quick +40, here’s the Monday trading plan

NASDAQ futures are coming into the last full week of July (the week after OPEX) gap up after an overnight session featuring extreme range and volume.  Price worked higher overnight, and as we approach cash open prices are hanging around in the lower quadrant of Friday’s range.

The economic calendar is light today.  Later this week we will hear earnings from Facebook, Google and Amazon.  Today we have Bank of Japan’s Kuroda speaking to the IMF in Washington at 11am.

Last week began slow, with a drift through the early part of the week, with indices marking time near record highs before seeing sellers step in during the second half of the week.  There were signs of strong responsive buying Thursday and Friday morning before sellers pressed prices back down to weekly lows on Friday.  The last week performance of each major index is shown below:

On Friday the NASDAQ printed a trend down.  The day began with a gap up into Tuesday’s range.  Sellers drove down at the open, closing the overnight gap up in short order then continuing lower throughout the morning.  A bit of responsive buying took price back up to the daily midpoint.  Sellers stepped in and defended then mid which triggered a liquidation down to a new low of the week.  We ended the day at the lows, down inside the 07/09 range.

Heading into today my primary expectation is for sellers to be active ahead of 7900 to set up a move to close the overnight gap down to 7843.75.  From here we continue lower, down through overnight low 7826.25.  Look for buyers down at 7820.25 and two way trade to ensue.

Hypo 2 buyers gap-and-go higher, sustaining trade above 7900 and trapping Friday afternoon sellers.  This trigger a trend reversal, with price trading up to tag the Friday naked VPOC at 7919.75 before two way trade ensues.

Hypo 3 choppy conditions, with price staying in a range between 7900 and 7840.

Levels:

Volume profiles, gaps, and measured moves:

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Regaining routine

We all slip up sometimes, which is fine.

I like helping people I care about, and people I care about have needed me to be a bit more hands on these last several months.  At some point, about when the heat dialed up into the mid-80s, I stopped putting my best effort into the Sunday Strategy sessions, skipped a bunch of morning trading reports, and also broke away from several other wellness routines (exercise, diet, etc).  Again, this is fine.

All of these mechanisms, or routines if we’re humanizing it, were established over the years to check me before I do something selfish like emotionally trade.

I have lost so many US Federal Reserve notes to emotional trading, mostly during my hot-headed 20s, when I was more than a little obsessed with making money.  Wanting something so bad and forcing it usually doesn’t go well, ask me how I know.

Anyways, it doesn’t feel good to break routine.  Its like when you’re full of pizza, but you enjoy the taste of it some much that you ram another piece down and then you’re sick for the next 18 hours.  I feel the same sick kind of way when I break routine, and that tells me to be cautious on all fronts—with relationships, with business decisions—everything.

I don’t trade when my research doesn’t feel good or when I plum skip it, I can’t afford to waste my resources anymore.  Truthfully, I couldn’t back in my 20s either but that lesson took some pain to really take root.

So hopefully this week I can dial back in.  I’m not sure yet, but temperatures are on track to drift down to more comfortable levels, and the people I care about are getting back on their feet.  But who knows what sort of fuckery lies ahead.  So, as always, TBD, and we’ll be taking it one day at a time here on the old RAUL blog.

Raul Santos, July 22nd, 2019

Exodus members, the 244th edition of Strategy Session is live.  I think the NASDAQ Transportation index paints an interesting picture, plus there is little else to go on, algorithmic or trading model-wise, so it’s about all we’ve got in terms of observable bias.

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