Tue Apr 3, 2018 9:11am ESTComments Off on NASDAQ gap up into challenging area, here is the Tuesday trading plan
NASDAQ futures are coming into Tuesday gap up after an overnight session featuring extreme range and volume. Price was balanced until about 8am EST when the market began a steady campaign higher. As we approach cash open, price is hovering along an area that served as support late last week before ultimately breaking on Monday.
On the economic calendar today we have a 4-week T-bill auction at 11:30am.
Yesterday we printed a double distribution trend down. The week began gap down and buyers quickly spiked higher on the open, stalling one-tick below the Friday gap 6570.50, but in the parlance of 40 point rotations, close enough to consider it a gap fill. Then sellers stepped in hard, and we were trend down all morning. The secondary rotation lower after New York lunch made new lows, probing down into prices unseen since February 9th when we made a swing low. Responsive bidders were found ahead of the lows and two way trade ensued.
Heading into today my primary expectation is for sellers to work into the overnight inventory and trade a half gap down to 6429. Here we see buyers step in and work up through overnight high 6464.75 setting up a move to target 6500 before two way trade ensues.
Hypo 2 stronger sellers work a full gap fill down to 6394.75 before two way trade ensues.
Hypo 3 buyers gap-and-go higher, sustaining trade above 6500 setting up a move to target 6522.
I have an optimistic bias towards Tesla and anything else Elon Musk touches. Unlike a journalist, I have told you my bias up front. Now, let’s look at a few relevant details regarding Tesla.
The bonds everyone is talking about, with the increasing premium? They are still being serviced. They do not expire until 2021. Also news flash: interest rates are going up. Did you happen to look at $TLT during Monday’s bloodbath? It was red. Welcome to the Jerome Powell Federal Reserve.
The Model 3 production numbers that are being repeatedly thrown under the bus, they have issued more than 20,000 VINS. A Model 3 typically delivers within 9 days of being issued a VIN number. Here is a Twitter account you can follow to track VINS on your own, without some negative spin being added to it:
Are the Model 3 production numbers below forecasts? Yes. But behind every VIN number is a person elated to receive a Tesla, a person who will spread the word of Tesla faster than any traditional disciple ever could. BEHOLD:
Two years ago to the day, I was standing in line to reserve my Model 3. Today my Model 3 got a VIN! Happy 0th Birthday, my as-yet-unnamed sweet! Thank you so much to all @Tesla for their incredible hard work. I’m counting down the hours…#tesla#model3#birthday#throwbackpic.twitter.com/P3pnMM1wTV
I wonder how much BMW or General Motors or Toyota spent on advertising last year and how many times those add dollars yielded the kind of brand excitement shown above…
Regarding the Model S recall, I believe our very kind and benevolent Leader addressed the media hullabaloo surrounding the recall sufficiently:
Tesla policy is to issue a recall *before* there are injuries. This is absolutely the right thing to do. Yet there were dozens of recalls by other car companies last month, incl w injuries & deaths, but you only wrote an article about Tesla. Why so?
I am not here to convince you Tesla is going to succeed and be the biggest company in the world, surpassing Apple slowly, that all at once. I already believe. And I have my money where my mouth is, long a considerable amount of $TSLA shares.
The value I can add, aside from being the loudest bull when it matters most, and otherwise quiet, is to show you how I expect $TSLA price action to play out over the next several months.
Here is how I envision Tesla price action playing out, going forward:
Is the above chart accurate? Perfect? Not really. These are broad brush strokes. With any luck, share price will be compressed for many years, allowing me to continue accumulating shares. But I think this gives you a sense of my mentality. I am extremely long term. The shares I am buying will not be sold. They will be passed onto my kin.
This is my take as a permabull. We are in the middle of a negative news cycle, and journalists from all publications are showing their true colors—they despise the hope and change Tesla and Elon bring.
Fine.
I will continue to be a voice of hope in the sea of negativity. Also I bought more $TSLA today.
NASDAQ futures are coming into Monday down about -50 after an overnight session featuring elevated volume on extreme range. Price worked lower overnight, slowly and methodically.
On the economic agenda today we have construction spending at 10am, ISM manufacturing/employment at 10am, and both 3- and 6-month T-bills being auctioned at 11:30am.
Last week started gap up. Gap was filled then a strong bid drove us higher for rest of Monday. Tuesday was gap up then trend day down. Wednesday consolidated on low-end of Tuesday trend. Thursday rallied, then faded at end of day. The last week performance of each major index is shown below:
Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 6570.50. From here we continue higher, up through overnight high 6588.50. Look for sellers around 6600 and two way trade to ensue.
Hypo 2 stronger buyers take us up to 6638.50 before two way trade ensues.
Hypo 3 sellers work down through overnight low 6527.25 and tag 6479.50 before two way trade ensues.
Sun Apr 1, 2018 10:02pm ESTComments Off on Utter failure at live broadcast, these 14 stocks will be bought Monday and held for 12 months
I feel defeated. Went live on Instagram, then my YouTube livesteam crapped out. Then my phone died. All recordings are lost and worst—I wasted my time and yours.
I spent longer than I should have putting together a nice set comparable to ‘Between The Ferns’ with supplemental lighting and all, because I know how much you all love seeing my beautiful, child-like face and exquisite physique.
Any-fuckin-how here are the 14 stocks that came out of the Exodus quant:
The Q1 leg of my quant will be equally weighted into the above names first thing Monday morning. Hopefully at better prices. According to my robots, we will gap down Monday then rally all week.
I have no idea if they are right but there is nobody else worth listening to.
See how salty I am? I am going to shut up now and continue reading Russian literature.
Before I go, just a heads up, the quant finished out it’s first trip around the sun with a return in excess of +20%.
Here’s to another year of prosperity ::smashes mug of chamomile tea through computer screen::
But enough of the doomsday premonitions, today is a most joyous occasion. Last night a six foot tall bunny was spotted in the neighborhood, walking upright, laying candy-filled eggs all over the place. A caravan of baskets floated in his wake, settling in homes along the way, filled with treats for all the boys and girls fortunate enough to live with hard working capitalist parents.
The socialists received nothing but stewed beets. They will be much healthier through the years but also quite bitter. Hopefully they remember to set their calendars next year so they do not miss their chance to sit on the bunny’s lap for 1 minute. If not, too bad! You sit on ground for rest of year.
The winds of change are blowing. Rains bring promise of bulbs a’blooming and there is an animistic excitement in the city’s techno halls.
Last week bulls came out and defended the stock market, but they piled into risk averse investments like medical REITS and appliance stores. For real though, look at last week’s industry flows:
This resulted in the DOW outperforming all major indices. This could mean two things—bears are still in control—or the risk cycle has reset and begun anew.
First the staples rally, then the tech darlings, then degenerate lottery plays. Unfortuantely, my degenerate lotto play $SCON did not participate in the 8th inning festivities, if in fact we have reset. So it is going to be a long ride.
But that does not matter to you. What matters to you, at least I hope, is what needs to be done next week to make money. Said money will be stockpiled and eventually used to procure real land as far north as your constitution will allow, safe guarding you from the inevitable herds of humans migrating up from the equator.
The fact that #MAGA fanatics do not believe in global warming, yet cower behind their guns upon seeing people migrating north blows my mind. Do you not see all life dying at the equator? Becoming literal dead zones that not even extremophiles can endure? Deniers truly are some of the dumbest people on the planet, relegated somewhere on the idiot spectrum just above the flat-earthers.
USE YOUR EYES to observe the objective facts.
Anyhow. What you need to do to make money next week, according to the models, is expose yourself long to broad market indices and ride them sum’bitches higher all.week.long.
So it is written, so it shall be. I am like your Moses, saving you from the liars and mind controlling media, telling you to only pay attention to raw stock market data.
Raw data doesn’t lie or spin narratives out to thousands of talking TV heads. Follow me to the promised land!
Hallelujah
Exodus members, the 176th edition of Strategy Session is live, go check it out!
One year ago I set out to convince you robots are better investors than humans, myself included. Robots are better suited for certain tasks than a human will ever be. Like stock picking.
I have only two ways of buying a stock. The first is what we are reviewing today—a quantitative system of choosing and acting upon stocks. If you want to see exactly how the quant is built you can watch my YouTube video but here is a recap:
At the end of every quarter, a quick, top-down style analysis is performed using Exodus. We start at the sector level—seeing which performed the best—then drill down to specific stocks within the best performing sectors that we will then hold for a 12 month period.
The second way to buy a stock is a bit more heavy. It involves drinking to proverbial koolaid and going ‘all-in’ on an organization. This type of investment is long term and based off of deeply held convictions. Some call it faith. Or tribalism. I embellish how bizarre people can become from religion when I talk about Tesla. It means you read every news article, the SEC filings, the production reports, executive arrivals, departures…everything. Each stock you hold is like a side hustle. You need to keep up with it or it starts to lose money.
Faith-based investing is mentally taxing, and overall a human life is far too short to be stressed all the time. Stress is good. So is weight training. Both need to be done for a short duration with good form. This is why we are loving quant approaches more.
The quant chooses. The quant wins or loses. Either way I take no credit for their performance. I am here to keep their cooling fans clean and rooms cool, like a custodian.
Anyhow the first live year of stock picking will be complete at close-of-business today, and on Tuesday morning the second adjustment of 2018 will occur. The system will also turn 1 year old! Baby’s first birthday, so cute.
So far the quant is absolutely laying waste to the S&P 500, besting it by more than 7% hallelujah:
Top 3 best performing quant stocks: $ATHM +170.5% $PAYC +85.2% $NOAH 80.6%
In summary, China. If you would have told #MAGA fanatics on April 1st, 2017 that China stocks were going to crush, they would spit in your face and have a parade down your street.
Worst 3: $IMAX -43.1% $AKRX -22.7% $EDR -19.3%
Going into this portfolio, I considered EDR the safe play. I was happy the quants chose EDR because I wanted safety. We had just ripped tits to the upside for four continuous months after the November 2016 Trump win. Look how bad my monkey brain was at picking stocks!? One of the worst ones, pathetic.
By proving to myself time-and-time again that robots are better than me, I keep my rambunctious ego contained. I appreciate the ego, but not when it comes to business execution. Success in business is about making one good decision after another, patiently stacking those decisions atop one another. If presented with the right information it is my belief that anyone can make good decisions. The right information to observe in the financial markets is raw data. The more pure your data the better. It is the clay from which your bricks are molded.
The foundation stones that you build on are millions of years old but only discovered by humans in the last 2500 years. They are the tenants of philosophy lads. Choose wisely.
Over the weekend, perhaps Monday, I will go live on YouTube and build the next adjustment to my quarterly quant portfolio. Hopefully you can tune in live, that way if you have any questions along the way I can address them. But I will do my best to make a recording available.
Enjoy the the holiday weekend. A somber Good Friday and exhilarating Easter to those who celebrate it. May you be safe, and happy, and as healthy as you can be. And may you have ease of being.
Thu Mar 29, 2018 9:15am ESTComments Off on THE WEEK ENDS TODAY, here is the Thursday trading plan
NASDAQ futures are coming into Thursday gap up after an overnight session featuring extreme range and volume. Price was balanced overnight with trade contained inside the Wednesday range. At 8:30am PCE core data was in-line with expectations while Initial/Continuing jobless claims data was below expectations.
Also on the economic agenda today we have U of Michigan’s final read of March sentiment at 10am.
Yesterday we printed a neutral day. The day began gap down, and after an early battle pushed price below the Tuesday low responsive buyers stepped in and closed the gap. Then we attempted lower again, and again we found responsive buyers. This time we traversed the entire range pushing us neutral. We then settled back to the daily midpoint for the rest of the session.
Neutral.
Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 6478.50. Look for buyers ahead of 6470 and two way trade to ensue.
Hypo 2 buyers gap-and-go higher, up through overnight high 6540.50 setting up a move to target 6600 before two way trade ensues.
Hypo 3 sellers press down through overnight low 6469 setting up a retest of the lows 6421. Look for buyers ahead of 6400 and two way trade to ensue.
“There is an easy way to download everything they know about you, and even delete it. We’re going to walk through this right now, step-by-step, I have my phone out, I want you to pull your phones out as well.” – Jeff Rosen, national investigation correspondent, “TODAY,” March 28th, 2018
Collectively, there is a strong dislike for Big Social. Silicon valley types riding around on robotic unicycles, sashaying into heated political debates while sitting at home in their glass mansions, commanding millions of followers to bravely challenge everything—and providing them the tools to do it.
British Parliament is calling for Mark Zuckerberg’s head—demanding he step out from behind the curtain where he resides, deep inside the world wide web. On the domestic front Rep. Greg Walden wants to see whether Mark is in fact a real human or just a skin suit full of lizards. The lifelong Oregonian probably still has flashbacks to what happens when a curious leader emerges to liberate and command a people. I imagine many dinner table conversations centered around the large fleet of Rolls Royces and burgundy-shirted wackos assembling in Wasco county.
The wackos of Wasco county are back, but what is happening in the communes of Facebook is more perverse than salmonella-spiked soup. Ideas, all kinds, are spreading into the minds of millions, faster than any highly-evolved swine virus manifesting in the cesspools of North Carolina.
It seems the pendulum has swung too far and regulators want to ensure they stay relevant in the war for our attention. No tech company is safe. Amazon and Google must have data, yes? Reams-and-reams of data yes yes? They have second and third generation fleets of robots in millions of homes. This is the sort of stuff that keeps dads like Frank Pallone up at night.
But the pitch forks and pens are pointed at Facebook. Everyone wants out. Even The Leader Elon (Praise) made a few clicks and deleted his SpaceX Facebook page, as if flicking a mosquito off His shoulder:
Such unashamed carelessness, Praise and Glory to our benevolent Leader. Meanwhile, Mankind’s Last Hope is active as ever on the ‘gram. The @elonmusk (Glory) Instagram account is still lit, as the kids say, with millions of likes raining down on His angelic face.
All this to say Facebook as a stock will likely be fine. Facebook.com may go away, probably not, but it certainly could go full Myspace, but $FB will still be fine. Owning $FB is like owing a VC firm that only does social. And the Jerome Powells of the world love private equity funds.
But over the next few months, perhaps years, Facebook users will wonder if they should abandon the platform. And perhaps they will. And then a long cold night will come. And then the fidget, to unlock the phone for a fix.
Am I still interesting and unique?
The legs shake, wondering if a tribe exists somewhere that is interesting and unique like me. And if they do exist, will I regret never finding them? Seeing if I was embraced by my people and together we could sing from the mountain tops?
AND THEY’LL SNAP. They will grab their phone and head for the internet, a place where no corner is too a reach. But how? Afterall they kicked Facebook. Facebook was the ritalin of their childhood. Now what?
Adderall…but in social media form. And that is, of course, none other than Twitter.
History rhymes. Products repeat, but the end user remains the same—a capricious addict trudging through life between opportunities to enjoy their next kink.
Lots of jobs are boring but some are worse—some are boring and slow. Mobile phones and social media apps make getting-off from the confines of your cubicle possible.
The deep psychological addiction evolved into sapiens to find their tribe and concentrate their powers is what has me long-term bullish on social media. The comedy of a negative news cycle affecting share prices has me convinced a short-term opportunity exists. Chart guys, think AVERSION.
Most importantly, the distracting offensive against Facebook has me favoring Twitter.
As a user of all social media platforms, a human addicted to the likes, laughs, comments, interactions, matches, and networks, I will assure you Twitter is the best. A constant stream of uncut social media excellence directly mainlined into the serotonin reuptake inhibitors.
But I am not here to convince you I am right or to try Twitter. My job is to use what I have to go get more. Like a modern renaissance man who gathers nuts and fruits and has some fun along the way. All the while observing the interesting tribes.
Greg Walden’s job is to find out if Facebook is a giant Russian proxy to fix American elections like they do their Olympians.
Good times.
Let history show that I was always kind to my robots, and that I was only the loudest bull occasionally, when my convictions were rock hard amongst a sea of melting pudding. Let the record also show that if Frank Pallone and Greg Walden manage to lure Mark into the house, I demand a thorough examination of his neck for a zipper. We need to know more about these lizards before it is too late!
NASDAQ futures are coming into Wednesday gap down after an overnight session featuring off-the-charts extreme volume and extreme range. Price was balanced for most of the session, chopping along the lower-quadrant of Tuesday range before slipping lower rapidly around 8:55am, back to the Tuesday low. At 8:30am advance good trades balance data was worse than expected and GDP was better than expected.
Also on the economic calendar today we have pending home sales at 10am, 2-year note auctions at 11:30am, and 7-year note auctions at 1pm.
Yesterday we printed a double distribution trend down. The day began with about a 40 point gap up. After a brief open auction price worked lower and closed the gap. A strong responsive bid entered at that point and it appeared the market was in balance. However, strong selling came in during the afternoon, with sellers becoming initiative, pressing us into a trend down. We closed near session lows, and below last Friday’s low.
Heading into today my primary expectation is for buyers to work into the overnight inventory and trade up to 6650 closing the overnight gap. Then sellers return us down through overnight low 6482.50 setting up a move to target 6439.25 before two way trade ensues.
Hypo 2 sellers gap-and-go lower, trade us down through overnigtht low 6482.50, pressing down to 6439.25 then continuing lower, down to 6414.50 before two way trade ensues.
Hypo 3 stronger buyers sustain trade above 6650 setting up a move to take out overnight high 6582.25. Look for sellers to defend 6600 and two way trade to ensue.
NASDAQ futures are coming into Tuesday gap up after an overnight session featuring extreme range and volume. Price worked higher late Monday afternoon and continued higher into the evening before responsive sellers rejected a move back into the 3/21 range, stepping in just above last Wednesday’s low 6842.25.
The economic calendar is light today—we have consumer confidence at 10am, 4- and 52-week T-bill auctions at 11:30am, and a 5-year Note auction at 1pm.
Yesterday we printed a neutral extreme up. The day began with a 100 point gap up, in-range. A brief open auction gave way to buyers who were able to barely poke above the overnight high before a strong wave of selling rolled in. Sellers nearly filled the overnight gap but did not. Instead strong responsive buyers stepped in, forming a sharp excess low. A brief battle at the daily midpoint saw buyers more agressive than sellers. Ultimately the buyers became initiative, pushing us neutral, then pressing the rally for the rest of the session, closing the day at the highs earning the neutral extreme designation.
Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 6774.75. Selling continues just through overnight low 6770.50 before buyers step in and two-way trade ensues.
Hypo 2 buyers gap-and-go higher, up through overnight high 6849.25 setting up a move to target the open gap at 6883.75 before two way trade ensues.
Hypo 3 stronger sellers press down into the Monday afternoon rally, down to 6666 before two way trade ensues.
