Sunday, September 28, 2014

VXX Watch

It looks like we have another VXX shorting opportunity ahead of us.  VXX touched the top of its downward sloping channel and fell away.  If it breaks below that trend line we are set up for a nice trade.  However, if we push higher this week, we are setting up for a very nice short trade.

VXX struggles outside of its channel.



Sunday, September 7, 2014

Perspective

Now that the Fed is continuing their wind down of asset purchases, can we expect to see a market cliff dive?  From a mathematical standpoint, the answer is no.  Earnings yields on the S&P is 5.04%, with earnings expected to increase 7.34% over the next 12 months.  Compared with a 10 yield of 2.43%, statistically we can expect another 10% higher in the S&P over the next 12 months.

Debt levels are now over their long term average, but earnings are outpacing interest costs so party on Garth.  Obviously the debt burden combined with an inabilty to service the interest at a higher rate will kill the bull, but not this earnings season.  Perversely, the Fed walking away will force banks to take on more risk, and they look at these models and see that there is some more blood in these corporate rocks to squeeze.

We remain in buy the dip mode, with an expectation that we will see a more sine wave look to the market to give us some nice trading opportunities.

Enjoy the video of my watchlist.

video


If you want the buy signals real time, go to www.realtimetradingsignals.com

Sunday, August 31, 2014

More Of The Same

The only interesting trade of interest is it looks like oil has a trade able move.  But I would not get too excited about it, or other commodities as Draghi may finally get the monetization action in the Euro zone out in the open, and that will further strengthen the dollar.  Besides, there is simply no way Obama is going to let oil prices rise into an election cycle.

The broad markets look like they are going to continue to rise, probably going into mid September, gold, silver, and the miners are uninteresting, and probably a good short if they start rolling down, and my view is volatility will squeeze down until we get closer to the Fed meeting in September.

I tried a video instead of posting charts.  If you like it I'll do more of them.  It is pretty quick and zippy.

Enjoy.  WWW.realtimetradingsignals.com  if you want real time buy and sell signals.

http://www.screencast.com/t/QCeBtlg9hud

Sunday, August 24, 2014

Don't Short Yet

The Yellen news is out of the way, and next week is the week before the world comes back from summer vacation, so unless we get a geo political curve ball there is nothing in the charts that say jump ahead of the market and short it.  In  fact, it still does not even make sense to take anything off the table yet (next week is a different story).

The good deflation meme is still playing out; dollar stronger, bonds stronger, oil weaker, gold weaker, volatility weaker, institutions still buying, or at least holding, market has no choice but to stay fully invested.

I am still keeping it simple and shorting VXX through put spreads.  I can envision a sub 20 UVXY before this market rolls over.  For those in XIV, stay fully invested until 42.39 is breached (paid subscribers get a daily update on the stop).

For those who want to short GLD, a break below 122.75, buy the Sept 120-118 put spread.

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Please click to enlarge the charts, and go to www.realtimetradingsignals.com to subscribe to my daily trade signals)










Sunday, August 3, 2014

Focus

Well, per my post last week we blew right through the crossroads, and Thursday/Friday big range days reminds me too much like 2008 all over again.  As volatility picks up, you must swing on shorter and shorter time frames,  and the mistake I made then as a leveraged trader is not getting smaller, faster, and more conservative, immediately.  Therefore I am going to get very focused, and focused on volatility.

Money is money, and I am just getting pure.  No need to look at a hundred stocks when everything is tied to volatility.  I made my most money trading XIV and UVXY puts during these elevated levels in 2011 as intraday moves can give you a weeks worth of profits.  There are a couple of trade-able edges in this environment, I have shared in the past, and will again.

Regarding gold, et al.  I am staying away as I think we are deflating, and with the Fed ending QE, I don't see a catalyst, unless gold responds positively to a hedge unwind.

On to the VIX.  I am looking for an overbought retracement (we may touch 17.80 area first), then a move higher to the 21 area.  That will give us a very nice UVXY put trade.  So for me, I have a VXX bull debit diagonal trade on Aug 29, Aug week2 29.50 (I have been opening, closing, and moving the sold leg every week) and will close he sold if we hit new highs, or a new buy signal on my expected dip.  I also bought some UVXY Aug, 30 strike puts, and will follow the signal above.  I will also point out XIV trades intraday, with tight stops.

We are back in a traders market, don't get sea sick.

www.realtimetradingsignals.com is my paid site.





Sunday, July 27, 2014

Crossroads

These last two weeks feels like a change in trend is coming.  My signals are firing and failing, and I must step down in time frames to squeeze out profits.  From a macro perspective it seems to make sense, the heroin from the FED is slowly drying up, and the Fed to SPY ratio says that SPY already hit the theoretical price that the final Fed Balance sheet will reach.

Volatility has refused to go down, and the dollar is up, which informs me that big money is getting defensive and this takes another funding source away from the index algos.

Small caps and commodities are struggling, and gold, silver, and miners are trying to reestablish themselves but no big moves so far.

If the dollar breaks out, it looks like TLT, FXI, and EWJ all look like macro buys, and I will call out calls on dips.  I will also focus on TNA puts.  The metals and miners are all in the handle stage of cups, and are moving up, so will be buying dips with calls.

For volatility, I am going to be a bit of Sybill.  I am going to play with spreads on both, and manage the sold legs to profit both ways.

So those that subscribe, I will be very focused. FXI, EWJ, VXX, UVXY, TNA, GLD, SLW, and GDX. We will trade these a little faster than normal as the market, in my view will try to shake out positions more frequently.  Monday before the open, I will tweet out my current positions, and the trades expected to signal that day.

www.realtimetradingsignals.com  is my paid site.

Click to enlarge











Sunday, July 13, 2014

Biotech Swings

Last week I featured metals and miners, and those trades worked out well.  I exited my NUGT, and rolled up my GLD and SLW calls.  Miners look set to take a breather here.

I also have been interested and invested in some Biotech plays, mostly situational, but that caused me to run some scans in this space.  I am glad I did.  There are a number of good buy set ups, and I share them with you below.  There are some doubles in here. Not listed, but my favorite; MNKD

Enjoy.  Please click to enlarge, and go to www.realtimetradingsignals.com to subscribe.