Ready now and the timing is right

It took longer than normal to update all research needed to be ready to engage the futures but not as long as I expected.  After the french press kicked in and, all the muscle memory came back and, the model was in front of me well, the my old friend the flow came back.  I split the morning between devising a weekly trading plan and watering the yard’s spring shrub transplants.  Mature shrubs are a joy millennials might not appreciate yet but, by the time they do I’ll have a house they’d like to buy but, they better be ready to put that premium up.

Looks like I didn’t miss much skipping out on July trading.  That’s usually the case.  Chop and noise.  All the big players out enjoying life.  Put the ambitious youths in charge.  Work them until they break.  Promote the survivors replace the weak.  This is summer in America.

But I’m back in time for the action to pick up.  How do I know?  I’m a bit of a futurist.  Sometimes I gaze deeply into the abyss and see slow revolutions taking shape.  Disciples preaching monotheistic faith after Pontious Pilate sealed Yeshua’s fate.  But there’s not much I can do to prepare for a historic shift beyond a few broad brush strokes.  Tesla. Twitter. Crypto.  But these next five days, these next five days…

They’re less hazy.  I have the right equipment to bring them into focus.  Not perfectly but pretty good.  Then as each day comes closer I’ll be ready for small precise on the fly movements.  Hopefully my old friend the flow shows up again.  I can see some lines. Those lines could be the right place to stand and wait for natural forces to bring me my shot; I can see me nailing the shot.

Sometimes my position is run over.  Then I have to focus on damage control.  That’s where muscle memory kicks in.

What size renko bar am I using?  How many NASDAQ points did I risk?  How many units are in place right now?  What’s this trade’s cost basis?  When will I know the trade is wrong?  If that’s the case, then should I take action right now?  Should I size back in?  Or eat the loss?  What is the market trying to do?

And so on.

There are huge market moving events scheduled for the upcoming week.  Something, maybe the sudden quantity of black flies around my house or the way Mars is dancing with the buck moon, tells me everyone will be greeted with a fresh geopolitical distraction.  But these information snippets below are the real things you need to be aware of.

Apple reports earnings after market close Tuesday.  They can move the entire market.  Look, this is all you need to see to believe me, a viral tweet from superstar investor and titan of finance Michael Batnick:

The market cap of the top 5 S&P 500 companies:

$4,095,058,706,432

The market cap of the bottom 282 S&P 500 companies:

$4,092,769,755,136 pic.twitter.com/qqcuOs0Qki

— Michael Batnick (@michaelbatnick) July 18, 2018

Wednesday is the first of the month AND the Federal Reserve has an announcement scheduled for the afternoon.  This announcement will come after what is not considered a live meeting.  There is no post-announcement press conference scheduled, which means Jerome Powell is probably in Nantucket somewhere enjoying a glass of iced milk with his fellow private equity thugs.

Nevertheless, Fed announcements almost always send a tradeable burst of energy through the market.  Be on the lookout for one around 2pm Wednesday.  I am of course referring to New York time.

The gambling halls in Chicago are currently placing 97.5% odds The Fed will leave their benchmark borrowing rate unchanged:

I’ll be watching for the third move after the FOMC meeting to dictate direction into the second half of the week.  But there’s a wildcard.

Nonfarm payroll data is due out Friday morning, premarket.  My primary expectation is for this data to exacerbate whatever move is happening head into the number.  Meaning, if we are selling into it, we accelerate to the downside.  If buying, the rally jolts higher with vigor.  If chop, more chop.  And so on.

Turning our attention to the indices (after all, they don’t call me @IndexModel for nothing) the Russell is showing subtle topping signs.  There was much stock market optimism during Q2 and it carried into Q3.  But Q3 grows old.  The Russell may be whispering caution.  It’s up against a resilient Dow Jones however.  And as for the index model itself, which codifies the major indicies and is prepared as part of the Exodus Strategy Session, it’s:

Neutral. I repeat, the model is neutral.

The Exodus mother algo is also neutral.  The most recent cycle  began Friday, July 6th at market close and spanned through to Friday, July 20th end-of-day.

There hasn’t been a 3rd sigma TICK generated on the NYSE all summer.  If you’re new here, I have access to super high quality raw data directly from the New York Stock exchange.  I receive it from IQFeed.  They have two NYSE ticks.  They made a dumbed down one because peanut-brained people wanted a NYSE TICK that pinged +/-1000 more often.  So IQ Fed made them one.  But they kept the real one.  I use the real one.  The right one.  Anyhow we have no signal coming out from the internals.  Shout out Trent for the hook up that discount code for IQFeed.

Top-down analysis shows broad strength across most sectors but weak Tech.  Weak tech kind of matters more than broad market strength because technology now represents about 25% of all stock market capitalization.  I can see this very clearly on the Dashboard inside Exodus:

See how this isn’t rocket science?  We leave rocket science to Our Dear Leader and his team of SpaceX scientists and engineers.  Moving on…

Weak tech kind of matter more than broad market strength which makes it kind of sweet that NAS-100 futures are my most understood instrument.  I will be reporting every morning which price levels matter because it’s part of my morning homework, which I freely publish because I know that even if I lead a horse directly do my favorite watering hole, they likely won’t take a drink.  And even if they do, nature replenishes these capitalist fountains quite well.  We could all have a drink.

I cannot emphasize enough that Apple can swing this entire market.  Our life is in Tim Cook’s very gay hands.  How’s that make you feel big tough guy?

And I’m ready to trade the way Tim Cook’s Apple earnings are received.

Sunday research is complete.  Exodus subs, the 191st (should be the 193rd but I slept on my research duties) edition of Strategy Session is live, go check it out.  If you think it would be a convenient feature to have the Sunday Strategy Session automatically sent to your email inbox, please let me know in the comments below.

With research complete I feel ready for the week.  Once I write my morning plan, I’ll feel ready to trade Monday’s open.  After I prepare Tuesday’s plan, trade Tuesdays. Wednesday, Wednesday’s.  But maybe Monday I’ll just sit back for the first few hours and let the big dogs slug it out.  If it seems like we’re way out of balance.  If that’s the case then I’ll wait.  Then after the dust settles I’ll fox scuttle in and start picking up scraps.

Twitter shares had their second worst daily performance in history Friday after meeting, mind you, meeting Wall Street’s earnings expectations and exceeding their pointless banker ass analyst estimates for sales.

I can tell very quickly it was the second worst single day for TWTR by using Exodus.  I just filter the ‘% Chg’ column and voila, a list of every ultra violent day in the company’s brief history of public trade:

Before I go into why I’m bullish on Twitter let me reiterate that I use Exodus as part of every single trading decision and I use Exodus when I blog.  If that turns you off, let me set the record straight—no matter what you say or what you do, you’ll never work this game like me.  I don’t make a penny off Exodus.  Maybe one day if I add value instead of taking value The Fly might pay me.

Free access. That’s it.

Meanwhile the shit I’m doing this year?  Insanity.  I’m running a book of 54 stocks that’s rising faster than the NASDAQ.  I own and keep adding to a massive Tesla position despite an army of Luddites who tweet me in all caps at night.  I’m climbing volcanoes like David Attenborough while trading OVERBOUGHT signals with leverage to victory, putting photos to market on Shutterstock and Getty, reading old fiction and new philosophy.  Running summer camp for Detroit investors.  They open auditoriums for me in the murder mitten and I kill it.  The fuck outta here with that Exodus to pay the bills shit.  I pull cash out the NAS-100 faster than some rich kid at a ATM speed dialing for a yatch re-up.  I’m putting a fucking bocci ball court in the backyard.

Twitter had a good quarter.  They sold $710 million dollars worth of internet stuff in 3 months.  They made a profit.  They boosted interaction rates.  They deleted a few million robot accounts.  Jack Dorsey is still a handsome dude.  Kanye and Kim invite him to their barbecues.

Flashback to 2016.  Trump beat the entire world at Who Wants To Be A President?  For better or worse.  This is America.  The old guard got caught sleeping.  Predators made a move, predominantly using Twitter and it worked.  Too bad.

Now ‘conservatives’ think they’re shadow banned because of their political standing.  They aren’t.  They tweet like foul beasts.  The algorithm censors their crass behavior.  Guess what?  It happens to me too when I tweet about eating humans like a meat lover eats swine or chicken.  The platform down ranks violence.  The opposite of WorldStar.

As for robot accounts.  They are pervasive across the internet.  I have 12.4k followers on Instagram (@vincalim, get at me!).   Those are robots.  I’m sure of it.  I bought them off fivverr as a joke in 2014 and now I can’t be rid of them.  Instagram, Facebook’s pride.  Everyone thought Mark was nuts when he paid $1 billion for Insta in 2012.  Now he’s a skin suit full of lizards that Washington DC fears.

There are millions of bots on every platform.  If Twitter is being proactive about removing them it will eventually be rewarded.  Monthly active users (MAUs) is a stupid data point tracked by vest-wearing choads in midtown.

Twitter is the most powerful platform in the world.  My stance on this matter is permanent.  You can command an army using hashtags and retweets.  My money is long until all-time highs or total bust.

I’m not some scared baby who only wants to be with a stock or crypto-thingy for the good times.  Long on the up moves, short on the downs.  Those people probably tried riding through bad times once and choked.  Maybe they don’t know how to win in America, how time and hustle play out.  So now apparently, these market timers loaf around swimming pools, trading forex on laptops.  Try that out sometime and see how it goes.

Ask me how I know.

Twitter can go lower in the days and weeks to come.  I’m not here to make predictions.  If you want predictions, go away.  I am here to tell you that I am long TWTR and to encourage you to augment your approach with robots before you’re put out the game by better equipped competition.  I need you around or it’ll just be me verse the institutions.  Which is fine, but we could all be chipping away at the pillars of finance so they crumble sooner.

I bought more Twitter at closing bell Friday.  I will buy more next quarter.  And the quarter after.  Said shares will remain on my book until we take out all time highs or until the stock trades $0.00 or some other bastardized form of zero.

I dollar-cost-average any stock that isn’t chosen by Exodus robots.  If I am buying a stock then I’m loyal.  The world needs more loyalty but it probably won’t happen.

Finally, an edit tweet feature is absurd. Stop asking.  Maybe you don’t understand how to tweet.  Bring your a-game.  Twitter isn’t for pikers.

Greetings,

I am back inside Mothership after a few weeks living on the fringe of society, a place where time was devoted to pleasure and adventure.  I took a giant drink of ambrosia from the island of Kauai and paid no attention to emails or the stock market.

Later I went to Kona big island where I had decent service on my mobile device but was happily distracted by a destination wedding that kept me surrounded around the clock by loved ones.  In short, I am coming into the stock market nearly blind and this is the last Thursday in July.  It seems like the perfect time to describe my process of reengaging the stock market after an extended break.

My reconditioning actually starts at the airport.  I log onto Twitter to take the collective temperature of society.  This only provides value because I have spent six years refining who I follow and blocking useless jerks like Montana Skeptic who was banished from my stream long ago but who Our One True Leader doxxed a few days ago and forced to STFU thank god:

I wrote about whatever the hell happened between Elon Musk and Montana Skeptic because I live and die for the discourse, baby, awwww yeah woooo https://t.co/TwgVMOnjB0

— Ryan Felton (@ryanfelton) July 25, 2018

But Twitter can be distracting.  So I limit my exposure to late nights, early mornings, and diner counters.  I tweeted about equality in mammal consumption, but nobody wanted to join the conversation:

I'd like to grow free range grass fed humans in the pacific northwest where the air is clean—to make to eat and to sell at high-end grocery dispensaries.

— RAUL (@IndexModel) July 25, 2018

I also saw this ironic TRADE WARS cartoon:

Next I open up NinjaTrader and begin splitting a 24-hour /nq_f market profile chart wherever I see a change event.  In a world of 24 hour markets I need to see all activity that occurred on trading desks around the world.  The American trading desks pass their books over to Japan.  Japan-to-Asia, Asia/Shanghai-to-London, the Russians might meddle around at some point, London back around to New York/Toronto, and so on.  A 24-hour market profile chart contains all of their interactions.

Once split into logical distributions, the chart reveals the most valuable trading levels in the industry and also begins to tell an actionable story about how the instrument I actively trade has been auctioning .  Right away I am noticing that the change events that cause me to split a profile into its own blob are hardly events at all.  The market is being just barely nudged out of short-term symmetry over-and-over.  This lack of explosive change tells me we are in the thick of slow summer trading conditions—a potentially dangerous time where boredom can lead to action for the sake of action which usually leads to losses.  Here is the updated market profile chart:

Next I score the short and intermediate term auction, nearby magnets, volume, and nearby highs/lows.  I use a 15-minute candle chart with daily volume profiles and a plain old daily bar chart to see and rank these components.  Each item is ranked from 1-to-5 with 1 being extremely bearish and 5 being extremely bullish.  All of these scores are put into Switchboard, which is a simple spreadsheet I built to codify ‘context’ as best as possible.

It took many brutal years for me to wrap my mind around context, and I believe it is the secret sauce.  The thing is nobody could explain context to me in a simple and repeatable way.  So I made Switchboard in 2015 and prepared it every morning.  If you had my Switchboard, maybe it would get you to a place of consistent profitability but it takes time and painful lessons.  Even after time and pain you occasionally catch yourself veering off course.

Updating Switchboard involves opening up the Historical tab inside Exodus and toggling to see if either the 36-month hybrid overbought or oversold algo recently triggered.  If it did, I note when it triggered and how many days it has been since the trigger and then score it into the Switchboard spreadsheet.   I also note major upcoming economic events and important (to the NASDAQ) earnings due out.  I can trade through both but I want to avoid being surprised by spikes in volatility.

Next I check on my passive quant fund.  All four legs are higher and continue to crush the S&P 500 which is nice.  Several family members and friends are also in this Exodus powered fund.  It is like I am a fund manager except I don’t get paid and robots do all the work.  It feels good to afford these people the ability to live their best life without paying fees to some dick nose money manager who knows tiddly dick about managing money.  Here are all of the fund’s current holdings:

But am I ready to trade now?  No.  I skipped my weekend research last Sunday (and the Sunday before).  And I do not trade unless I have done all my homework.  Remember all that learning pain I mentioned a few paragraphs ago?  My homework routine back then was pathetically inconsistent.

Despite not being ready to trade I am in a solid mental place now and back at the main control center of Mothership.  I do not need CNBC or the The Wall Street Journal.  My news flow is crowd sourced through Twitter and iBankCoin, and everything I need to know about the actual stock market is all in the data.

I am informed now.  I could trade if I wanted to put 5 hours into overdue research, but I am not desperate to extract moneys from the Chicago Mercantile Exchange via NASDAQ 100 futures.  Like why do last Sunday’s research now, if it only affords me the ability to trade the two days left this week?  That said, I am sure this Sunday’s research will take longer than usual.

Time is my biggest asset and this is how I reengage my brain to go back to thinking about taking USA fiat dollars out of the world’s financial markets—a game so pure it represents the last real form of capitalism on the planet #blessd  Just imagine trying to start a new car company…and the bro-buddy conspirators you’re up against.  That isn’t capitalism that’s war.  Say a prayer to Elon and send blue waves of good energy towards his team of scientists and engineers.  They’re gonna need all they help they can get fighting the soul-suckers at General Motors and bribed politicians who mouthpiece for Big Oil.

I hope by sharing this I help you, the reader, liberate yourself from the shackles of confusing financial news and the charlatans of high finance.  Routine is routine and process is discipline. Discipline is nice and earns you autonomy because as long as you have enough US dollars and you are kind to your neighbors you can make your way though the world, no ones master no ones slave #hallelujah

NASDAQ futures are coming into Wednesday gap down after an overnight session featuring extreme range and volume.  The move was news driven.  After closing bell Tuesday tariff news came out and spooked futures lower.  Price worked down into the upper quadrant of last Friday’s trend day before a responsive bid stepped in and balance formed.

On the economic calendar today we have crude oil inventories at 10:30am and a 10-year note auction at 1pm.

Yesterday we printed a neutral day.  The day began gap up which sellers quickly resolved.  Buyers came in well above the Monday midpoint and we pushed higher, going RE up by late-morning.  The bidding stalled, and we traversed the entire range and went RE down, putting us into a neutral print.  Price then returned to the daily midpoint and chopping along it into the close.

Neutral day.

Heading into today my primary expectation is for buyers to push into the overnight inventory and return to the ‘scene of the crime’ which aligns with the overnight gap 7301.25.  From here we continue up through overnight high 7305.75.  Look for sellers a tad higher at 7311 and two way trade to ensue.

Hypo 2 sellers gap-and-go lower, trading down through overnight low 7204.50 setting up a move to target 7198.50 before two way trade ensues.

Hypo 3 full-on liquidation.  Sellers sustain trade below 7198.50 setting up a move to target 7154.25 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

NASDAQ futures are coming into Tuesday gap up after an overnight session featuring elevated range and volume.  Price worked higher overnight, stopping just one point shy of making a new record high.  As we approach cash open, price is hovering above the Monday range.

On the economic calendar today we have a 4-week T-bill auction at 11:30am and a 3-year note auction at 1pm.

Yesterday we printed a normal variation up.  The day began with a gap up-and-out-of range which sellers pushed into after a morning two-way auction.  Sellers were unable to reclaim the Friday range though, instead responsive buyers (responsive relative to the Monday open, initiative relative to the Friday close) rejected the attempt well ahead of Friday’s range.  We then spent the rest of the day auctioning higher trading into the upper quadrant of 6/21’s liquidation day.

Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 7301.  From here we continue lower, down through overnight low 7295.25.  Look for buyers down at 7274.75 and two way trade to ensue.

Hypo 2 buyers reject an attempt to close the overnight gap, setting up a move to take out overnight high 7335.50.  Look for sellers up at 7338.25 and two way trade to ensue.

Hypo 3 strong buyers sustain trade above 7338.25 setting up a move to target 7400.

Levels:

Volume profiles, gaps, and measured moves:

NASDAQ futures are coming into the first full week of Q3 gap up after an overnight session featuring elevated range and volume.  Price worked higher overnight, slowly, working well up into the 06/21 liquidation day.  As we approach cash open price is hovering beyond last Friday’s range and we are likely to begin the day out of balance, with higher time frame participants pushing each other around during the open.

The economic calendar is light today.  At 11:30am the US Treasury will auction off 3- and 6-month T-bills.  Then at 3pm we’ll hear the May reading of consumer credit (which is running high).

Last week was split in two by the American Independence day, which caused markets to close early Tuesday and remain closed Wednesday.  Last week began gap down which was quickly bought-up, closing the gap and continuing to run higher.  Tuesday opened gap up and faded the entire half day—moving lower.  Wednesday closed.  Thursday gap up.  Sellers manage to close gap to the tick then buyers step in and rally the rest of the day.  Friday trend up.  All the while the Dow lagged.  The last week performance of each major index is shown below:

On Friday the NASDAQ printed a trend up.  The day began with a gap up that managed to close during the opening auction before buyers drove higher and continued driving higher until reaching the open gap left behind on June 22nd.  The market paused here for a few hours then another leg of buying carried us into the bell.

Heading into today my primary expectation is for a gap-and-go higher.  Price works up to 7300 before two way trade ensues.

Hypo 2 stronger buyers trade up to the open gap at 7312.  Stretch target is 7331.50.

Hypo 3 sellers work into the overnight inventory and close the gap down to 7232.  Look for buyers down at 7200 and two way trade to ensue.

Levels:

Volume profiles, gaps, and measured moves:

I do not like discussing the trading signals generated by Exodus outside of the paywall.  But we are flagging hybrid overbought.  The signal became official on close-of-business Friday.  That means everyone reading this very free and public blog has just as much opportunity to engage this trade as anyone who pays for an Exodus subscription.  If you are an Exodus member, and this is annoying to you, reading my public announcement, you may want to consider channeling that energy towards actually trading this signal correctly.  Because in my 1-on-1 talks with nearly 100 different Exodus members, I’ve yet to find someone who tells me they trade this signal the way you are supposed to.

First mental roadblock—it is called hybrid overbought.  That seems to mean the system expects lower prices.  Perhaps when the signal was designed, that was the intention, to identify a stress point from which lower prices would follow.  And perhaps in the future, if we are in a prolonged downtrend, it will be useful at identifying a selling opportunity.  A good way of knowing what the signal currently suggests you do (if you want your trading process to be driven by statistics) is to look at historical activity from all the other times the signal fired.  My main takeaway is that 83% of the time the SPY was higher after 10 trading days:

I actively trade NASDAQ futures, not S&P futures, so I prefer QQQ (actually TQQQ) as my instrument for playing this signal.  What I will do is simple—come Monday, when the stock market opens at 9:30am eastern, I will buy TQQQ.  Then, near end-of-day Friday, July 20th (10 trading days later) I will sell my TQQQ.

Simple. So simple.  Will I make money?  That is, as always, to be determined.

What is not to be determined is what I need to do when Exodus flags hybrid overbought.  I need to engage the long side.  There.  I have led you, fine horse, to water.  Feel free to stare at the glittering blob or have a drink.

This is an uncommon signal.  The last one happened on January 5th, 2018.  I traded it, made money, then went up in the mountains for many weeks.  This was the performance shown by each major index during the last overbought cycle:

Speaking of travel, a programming note:

I am headed to Hawaii this Saturday to explore the island of Kauai which I am told is in rough shape.  Many trails closed, beach gone, etc.  It could also be wet.  Therefore I am not bringing a laptop.  This means there will not be an Exodus Strategy Session next Sunday.  This will be the first Strategy Session I have missed in 190 consecutive weeks.  I feel like a jerk for leaving you guys without my research but I have no choice.

I will still be in Hawaii, but on the big island on July 20th.  Hopefully I will find enough internet to close out my TQQQ position that I intend to buy tomorrow.

I have never worried about talking my trading edge in public because I know 99% of people aren’t going to do the work.  Or even if they do, they will find ways to sabotage themselves, tilting off the plan and reducing their decision making to base survival instincts.  Instincts hard coded into the sapiens DNA that are effective in many circumstances, but not too useful (and often harmful) in the world of money management.

These blog scribbles are for 21 year old me, who was starved for useful information and had to scour the internet for information on trading the stock market that wasn’t either a. generic SEO optimized shit b. charlatan/lifestyle watch and car shit or c. pure unadulterated garbage.  Working closely with Exodus, and the fact that Exodus subscribers have invested in a platform that I truly believe anyone can build a consistent trading approach from, it seemed important to emphasize the hybrid overbought signal and how to trade it.  So I will repeat:

Go long Monday morning, July 9th.  Close said longs end-of-day Friday, July 20th.

I suggest broad market exposure via an index ETF.  If you want to try your luck at stock picking, by all means do it.  That ain’t my game.

Many decisions can be made simple.  Given the right information any sane person should be able to arrive at the same conclusion and behave accordingly.  Horse, water, etc.

This blog entry has been filed under the Category: Spoonfeeding

Most distinguished members of Exodus, the 190th edition of Strategy Session is live.  Go check it out.  Sorry in advance for missing the upcoming strategy session.  I will have to update the model data points after-the-fact, which in my mind tarnishes the objectivity of the results, but I promise to do so as honestly as possible.

I could have been trading NASDAQ futures this morning or sending important emails or scratching a few tasks off the old ‘to-do’ list.  Nope.  Instead I watched fifty or so nuclear explosions uploaded by the Lawrence Livermore national laboratory.  They decided to digitize the footage from about 200 nuke tests.  I just kept watching nuke-after-nuke.  Here are some stand-out nukes:

It could be all these weak ass fireworks going off around me that has me on a nuke bender.  My neighborhood is a mix of pickup truck loving Americans and old country Italians.  I venture you can guess who is blowing shit up.  Or it could be my recent obsession with dark forces and superstition, which is a close relative to faith.

Along the lines of faith, I initiated a new long term stock position late last week in Terraform Power, Inc.  I say long term but I need to learn more about their management and we need to break up-and-away from this wedge otherwise I’ll be forced to shift the funds into Tesla instead:

Because the position is based on faith in my One True Leader, Elon,  The belief being that Elon (Praise Him) and his team of scientists and engineers are Mankind’s Last Hope, and that they will succeed and save us from the destructive powers of big oil.  That they will continue to accelerate the adoption of alternative energy and electric cars.  And that some alternative energy stocks will grow rapidly as Elon leads us to greener pastures.  All the other car companies will of course stagnate.  They won’t perish through.  General Motors is to big to actually participate in real capitalism.

Faith keeps me tethered to Tesla.  I am not thrilled with the current share prices.  I would love to see it come down to $100 or so, allowing me to accumulate shares through my mid-30s at a discount rate, before they ultimately become the biggest company in the world while I become an old man.

So I am investing in some ancillary plays for now, based on the same immutable faith I have in Elon (Glory to The Leader).

We need to blow another nuke off.  All the old footage is weak.  We need to use those high resolution, slow motion cameras to really see the obscenity of a rapid nuclear reaction in full HD.  Just one.  And set up lots of good props.  Like if we are going to do it let’s do it right.

NASDAQ futures are coming into Monday gap down after an overnight session featuring extreme range and volume.  Price was balanced overnight before eventually breaking lower and trading down near last weeks low.  As we approach cash open price is hovering below last Thursday’s midpoint.

On the economic calendar today we have ISM Manufacturing/Employment at 10am, then the US Treasury auctioning off 4-week, 3- and 6-month T-bills at 11:30am.

Last week began with a quick gap down lower too.  It was sold into Monday, then a late-day ramp occurred.  Prices held the ramp levels until Wednesday afternoon when another leg of selling pushed through, making new weekly lows.  Thursday opened near the lows, two-way auction ensued and eventually broke higher.  Friday was spent balancing out.  The last week performance of each major index is shown below:

On Friday the NASDAQ printed a neutral extreme down.  The day began gap up and out of Thursday range.  A morning two-way auction broke higher briefly before responsive sellers stepped in and erased the morning gains then continued pushing lower, reclaiming the Thursday range late in the day.

Heading into today my primary expectation is for buyers to work into the overnight inventory and trade up to 7162.  Sellers reject a move back into the Friday low 7061.25 and two way trade ensues.

Hypo 2 stronger buyers work a full gap fill up to 7072.75 then sustain trade above 7061.25 setting up a move to take out overnight high 7088 before two way trade ensues.

Hypo 3 sellers gap-and-go lower, down through overnight low 6992.25.  Look for buyers down at 6892 and two way trade to ensue.

Levels:

Volume profiles, gaps, and measured moves:

It’s funny how time keeps going by.  Here we are 26 weeks further down the line.   Exodus strategy session number 189.

Things are different this time.

At least that is what we need to tell ourselves.  Then we can pick up where we left off, push a little harder on the flywheel hoping it spins longer than last time.

26 weeks later and it’s July 1^st.  The Julian midpoint of 2018, off by a few human hours give-or-take.  A good time to decide where I’ll commit my finite supply of time and liquidity.

TIME AND LIQUIDITY.  The currency of freedom.

I have two ways of picking stocks to own. One is quant driven and adjusts quarterly.  I am beta.  Exodus is alpha.  I merely service the robot while it scans human interactions and learns.  Anyway here are the latest picks:

This piece of the quant looks at 6-month returns then weights into the best stocks from the best performing sectors, adding a high shot float kicker where possible.  Here’s how the thing played out during its first trip around the sun. Look at all that alpha:

Next matter of business.  The index model is neutral for a second week.  We are celebrating Independence Day Wednesday.  The markets close early Tuesday.  The algos whisper about a drift higher into the holiday.  Then it could be time for sellers to press again.  Hard to say.  Definitely a holiday week.  Less is more.

Time keeps going by.  The process keeps me from wandering off the path.

Thank you everyone for the nice words of encouragement on my last entry.  I appreciate it very much thank you.  May everyone’s holiday week be refreshing to the mind and body, and may you have ease of being as we head into peak summer heat.

Exodus members, the 189th Strategy Session is live.  Check out the context in Section IV we have a clear ‘tell’ heading into the week.