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Goodwill HuntingI read recently that over 80% of all the S&P500's assets are now intangible. It's remarkable the impact that sentiment can have on valuations. I don't think anyone can imagine a scenario where stocks crash 84%. But, if history has taught us anything, it's that sentiment, alone, can accomplish this seemingly impossible feat. The perpetual sense of "hope," delivered to market participants through optimistic narratives, on a daily basis, is certainly helping the cause. In a recent report, Jared Woodard, at Bank of America, mentioned that value investing is dead. At the moment, I have to agree with him. But, only as long rates stay low, and sentiment stays high. Based on my own personal experience, it appears that sentiment injections are slowly losing their potency, and effectiveness. The law of diminishing returns is beginning to rear it's ugly head, and when sentiment eventually shifts to the downside, we all know what happens next. Jobless claims came in better than expected at 712k vs. expectations of 775k, with continuing claims at just over 5.5MM. Pandemic emergency claims continue to rise, and hit an all-time high last week with a print of 4.57MM. The total number of Americans still on some form of unemployment is hovering around 20 million. You won't see that on the news, though. ISM Non-Manufacturing index came in worse than expected at 55.9%, the lowest print since May. LA has just imposed new lock downs, and I'm getting a sense that California may try to take this state-wide at any moment. Most of Europe is on strict curfews and lock downs, but don't tell that to their stock markets, which are barely changed since the news broke. France is a perfect example; the CAC40 was up the day France imposed new lock downs. Simply astonishing. The majors were up marginally on the open, after a stalemate in overnight trading. But, the SPY is currently making another all-time high, as we speak, and is sitting around 368 an hour into the morning session. Hourly RSI is sitting just below 70, showing overbought conditions, and the daily RSI is approaching overbought levels, also, with a 66 handle this morning. Clearly the jobless claims print won't be a catalyst for weakness in risk assets today, but November payrolls are out tomorrow and I'm keen on seeing how the "recovery" progressed in November. Stay tuned for live updates throughout the day, and thanks for your time today guys! If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research. Cheers, Michael.
AMEX:SPYShort
by Hedge_Of_The_World
44
The Bear Sips His WhiskeyAfter a day of trading, the bear sips his whiskey, then decides he's just way too stressed to get friskey. He watches his charts over and over again, and then he shakes his head, before he brushes his teeth and get's ready for bed. His paws are sweaty, and his thoughts are heavy, he knows he's probably gonna dream of that chevy, that he can't afford, because his account looks like a honda accord. He wakes up frantic, and his bed is soaking wet, but not cause he peed, but because of the sweat. He's anxious, he's nervous, he thinks this whole thing is coming down, but whether he's short right now or not, his fur will always be brown. He's a bear, yes he is, and his heart is big, but if the FED shows up one more f*cking time, he may have to find a new gig. But he ain't worried, not even for a second bro, cause the tides a'leaving, and stock are in for a reckoning yo. The bulls will be running scared, and the bears roar will be echoing loud, and if not today, or tomorrow, my fellow bears, this once in a lifetime trade will be soon be ours. Sip.
AMEX:SPYShort
by Hedge_Of_The_World
41
Raging BullHey guys! Let's get right into it today. So yesterday the bulls successfully broke through 9 year resistance (well done to the bulls), and as we kick-off the final month of trade in what has turned out to be a year for the history books, the bulls will be looking to take full advantage of the (obvious) death of price discovery, and the bear (RIP). The current Put-to-Call ratio proves bears are extinct, with the lowest print I've ever seen my career (0.34 today). By contrast, the next lowest print was in Oct 2007, when we saw 0.42. Seemingly everyone, (except me) has been squeezed out of their shorts, and hedges. Those still holding cash are slowly but surely watching their purchasing power diminish, with the nuclear levels of fiat debasement we're witnessing on a daily basis. Bitcoin and Gold alike show the inflation carnage quite well, as they hover near all-time highs once again. The US majors were up an astonishing 10 - 12% in November alone, (this used to be a solid annual return), and all that off the back of hope, according to the financial media. It's becoming clear that in a market relentlessly beaten beyond recognition, that only the FED and hope matter. Personally, I'm focusing on increasing my income, continuing to utilize excess cash on hand for hedging purposes, and shorting overvalued indexes such as the Nasdaq. I simply refuse to eat the sh*t they keep trying to feed us each day, and if I have to sit on the sidelines until we see proper functioning markets and price discovery again, that's a better solution imo. ISM Manufacturing came in weaker than expected this morning at 57.5% vs 58% exp. Construction spending rose slightly with a print of 1.3% vs expectations of 0.7%. The 10Y yield is still hovering around 0.9%, with the recent breakout smothered by (timely) demand. The Vix continues to get hammered, and we saw a sub 20's print on Friday, for the first time since mid February. Well done to the FED. The message to investors is clear: Don't you dare attempt to manage risk by shorting or hedging. Just sleep... Thanks for your time today guys. If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research. Cheers, Michael.
AMEX:SPYShort
by Hedge_Of_The_World
10
Gap Up Cocktail, With A Short Squeeze PleaseIn a seemingly massive win for the Biden Campaign, Emily Murphy at the GSA (General Services Administration), confirmed that the Trump Administration is ready to move forward with the peaceful transition of power process, in the accordance with the law. I don't know whether or not this is a move to escape the legal nightmare Trump is living each day, or whether he has a final card up his sleeve to somehow hold on to the presidency. More likely than not, Trump is moving on with his life, at least for now. What I found most interesting about the news, though, was the fact that futures spiked almost immediately after. Since when is a Biden victory good for stocks? - If memory serves, Biden was going to raise corporate taxes on millions of small businesses at the worst possible time. - Trump said if Biden won, we'd see the worst depression in history because he would lock down the nation, and cause another market crash. - Biden was going to kill big oil. - Biden was going to face stark opposition on any stimulus proposal he brought forward. - Some experts have said they're expecting stimulus in the realm of $700 Billion; that's not quite $2.2 Trillion. Yet, (global) markets spike on the news that Trump is essentially conceding to Biden. I guess when you can print GDP, who needs an economy? *Takes deep breath* Let's see what's happening over on the SPY: We gapped up on the open to around 360.21, off the back of the GSA news, and we're sitting just above the Megaphone trendline which is now sitting around 357.50. We're also kissing the upper trendline of the triangle/weak (volume) bullish pennant around 361.60. Finally, we're approaching the bottom of the ascending channel formed over the past 7 months or so, now sitting around 362.50. We're outside the megaphone right now, and if we break above for the first time in 9 years, on the monthly, we could see a biblical short squeeze. Just a reminder folks, the end of the month is next Monday. As I said, until we see a clean break of the megaphone on the monthly, I ain't going anywhere... Stay tuned for live updates throughout the day, and thank you for your time today guys. If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research. Cheers, Michael.
AMEX:SPYShort
by Hedge_Of_The_World
37
The Spy Who Shagged MeHey guys, I hope everyone had an awesome weekend. Let's get right into today's analysis: US Futures managed to stage a notable rebound on Sunday night, after an ugly close on Friday when the bulls lost key weekly, and monthly supports. We were up about half a percent into the US cash open, but have since erased most of the overnight gains. Circling the MSM today are interesting headlines about how the Trump administration is distancing themselves from Syndey Powell, who is apparently getting ready to drop a "bombshell" voter fraud lawsuit against Georgia as early as this week. I suspect Trump and his team are trying to create the illusion of distance here so the case seems as independent and unbiased as possible. I wish them luck with that. We're also seeing headlines about more "Vaccine Hopes," which just puts a smile on my face everytime I see this price action narrative. Wash, rince, repeat... In a recent report, JP Morgan analysts, off the back of Goldman's recent report on month-end rebalancing (of over $35 Billion), say they're anticipating an even larger and more vicious sell-off into year end. They're expecting a correction, which they say would position the FED for further easing/dollar debasement into 2021. Total forced selling by year-end is estimated to be over $300 Billion according to the report. Imo this could bring the entire house (of cards) down, with market depth currently the worst it's been since the March crash. SPY is looking particularly fragile today as the bears continue to defend the long-term (megaphone) trendline. But, we all know the bulls are not going anywhere. I suspect if we successfully fill any of the gaps above this week, it will be quickly met with relentless miracle bids. That's not necessarily a bad thing, as the increased volatility could set us up for some fruitful short-term trading opportunities heading into December. I'm watching the 355 level as daily support, as I'm seeing us skipping on top of an ascending triangle formed from the Nov 5th high. If we lose this level, we may see a sharp sell-off down to the 350 area, where the first gap is sitting, along with the top of the previous triangle, and the 21 day EMA at 351.07. That's pretty heavy support, but it's not exactly a stone's throw away from current levels... Stay tuned for live updates throughout the day, and sincere thanks for your viewership guys, I appreciate all the support. If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research. Cheers, Michael.
AMEX:SPYShort
by Hedge_Of_The_World
14
But, This Ship Can't Sink?In a move that's shocking both Wall Street and Main Street, Treasury secretary Steve Mnuchin has officially put the FED on notice in a bid to end the FED's Emergency Lending Programs by year end. Headlines from popular economists are circling the MSM, and some are saying this is the equivalent of removing the lifeboats from the Titanic. First of all, that's hilarious, considering there were never enough lifeboats to begin with, (because the ship was seen as unsinkable), at least not for the poor passengers. But, the point here is this; the Trump administration is signaling they're not going to hand the Biden administration a basket of goods as a farewell gift. Unfortunately, what this translates to, inter alia, is the FED won't be able to buy their favorite Mega-Tech bonds, essentially putting a direct stop to the billions flowing into the heavy weight side of the stock market through this particular program, and through low interest rate debt funded buy-backs. In addition, ending this program also put's credit markets at risk of a crash for a number of reasons. Most importantly, we've never had such a high percentage of BBB- (lowest level of investment grade) rated bonds in history. If any of these bonds drop even a single rating level, many, many, trillions of dollars sitting in pension funds, would be breaking their mandates, which is to stick to investment grade paper. So in other words, extremely large funds may start dumping BBB- bonds in the near term. Yields would spike alongside inflation, leading the FED toward a single conclusion, which is to raise rates, and discourage borrowing. As ZeroHedge so elequently put it, "Let's hope America's Zombie companies have learned how to swim after all those years of treading water." Finally, as the legendary MC Hammer would put it, "Uh oh." SPY Analysis: After breaking through key supports earlier in the week, the bulls have a difficult job on their hands today. Although we're sitting right below the megaphone and ascending channel trendlines (converging around 357), sentiment is turned notably negative today, with Giuliani and Sidney powell's update on the Trump administration's lawsuits last night, along with the news from the Treasury. We're seeing an unusual risk-off mood heading into the weekend. Lastly, each time we've approached the megaphone trendline (357) on the weekly, absent a break above, we've gotten a strong rejection. On the monthly, if the bulls are unable to keep us above 357, we could revisit 320 again very soon. My exit is 300... As always guys, stay tuned for live updates throughout the day, and thank you for your time, I appreciate all the support. If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research. Cheers, Michael.
AMEX:SPYShort
by Hedge_Of_The_World
20
When The Bulls Became BearsHey guys, so for the moment the bears continue to dictate price action after yesterday's minor sell-off, as overnight losses in futures extended into the US cash open. After recapturing 2 key trendlines from the bulls yesterday (ascending channel, and megaphone), the bears are taking full advantage of the downward momentum, and we're now racing toward the top of the triangle around 349. There's very little support above 350, and with the 21 day EMA sitting around 349.80, and volume steadily increasing behind price action, this is the next logical interim support imo. With the rug now pulled from beneath the bulls, let's see what the bears have in store as we approach the end of the week. Vaccine headlines are circling the MSM again today, but this new narrative is seemingly losing it's ability to impact (distort) sentiment. Stay tuned for live updates today, and thank you for your support! If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
AMEX:SPYShort
by Hedge_Of_The_World
6
The Marathon ContinuesUS Futures traded marginally higher this morning, off the back of more media narratives of a "95% effective COVID-19 Vaccine". Prior to this most recent, and in all honesty, comedic narrative, it was "stimulus optimism" that drove (global) markets higher. But, I guess investors are not worried about that anymore. What happened to China Trade Deal optimism? I guess that doesn't matter anymore, either. It seems the FED and the government clearly take the public for fools, and maybe for good reason. The real economy is dead my friends, and for years it's been propped up by ZIRP, NIRP, bedtime stories of optimism, never-ending dollar debasement in the form of QE/"Liquidity", and exponential fiscal debt. Stock buy-back's continue to portray earnings growth, when all these companies are doing is perpetually lowering the number of shares outstanding to show earnings growth. Actual revenue growth has averaged just 4% over the past business cycle, vs earnings, which have grown somewhere in the realm of 30%. This is a magic trick, like every other aspect of the stock market. The stock market, as we see it now, has next to nothing to do with stocks, which is quite sad. But, let's see how long this lasts before everyone realizes that bedtime stories, and magic tricks, can't elevate stocks forever... Good luck out there today guys! If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
AMEX:SPYShort
by Hedge_Of_The_World
8
Stocks Sink As Lockdowns LoomHey guys, so I took a few days off because my wife and I moved. I hope everyone had a great weekend, and an even better thanksgiving! Let's get right into today's analysis. Global markets are mixed this morning, with US Futures trading slightly off yesterday's high's. Although we're seeing heightened optimism off the back of successful vaccine trial results from Moderna, and Pfizer's BioNTech, the interim rally lost steam amid growing concerns over a second wave of lockdowns. California, and New Jersey, among others, imposed new restrictions, and this is being rolled out pre-winter. Imo it's only going to get worse, and could be the scapegoat, yet again, to explain why the market crashes/corrects. Updates: - Gold is up marginally and sitting around 1889. - Yields were slightly off their high's with the 10Y sitting at .89. - Retail sales came in weaker than expected with 0.3% growth vs 0.5% exp. (prior 1.6%). - Industrial production came in at 1.1% vs expectations of 0.9%. - Capacity utilization came in at 72.8% vs 72.3% exp (prior 72%). - The Dollar (DXY) continues to get hammered, and is now sitting at 92.35, after a recent, but albeit brief, surge to 94.30. - The Vix is seeing some strength today and is trading off the recent low's. We're testing the 50 period MA on the hourly (23.80), but we have a long way to go to recapture the 100 day MA at 26.80. How much more of a beating can the Vix possibly take in the name of fundamentally suppressing price discovery? Well, I read recently that retail investors (dumb money), have out earned Hedge Funds (smart money), 10 to 1 this year. I think that sums up the current state of the market. - Bitcoin rose above 17,000 as the dollar debasement parade continues. SPY Analysis: - The Bulls successfully broke us above both the ascending channel resistance (a key trendline formed from the March crash, now sitting around 359), and the multi-year, megaphone resistance line at 358. I can't stress how close we are to a major move here, given the importance of these trendlines, alongside current stock valuations, and economic weakness. You guys need to decide if you think this massive move is going to be to the upside, or to the downside. You know where I stand on this. - If the bulls are able to hold on to the megaphone line on the weekly, it would mark the first weekly close above this trendline since we broke below in July 2011, over 9 years ago. I think it goes without saying that if there are any bears left, they'll be showing up this week to defend these long-term resistance levels. Major supports to watch below the megaphone resistance are 350 (the top of the triangle), the 21 day EMA (347.42), and the 50 day MA at 340. - The daily RSI is now sitting at 67, and the hourly is at 68, showing we're approaching overbought levels over multiple timeframes. (Weekly RSI is at 60). Thanks for your time today guys, and good luck out there! If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
AMEX:SPYShort
by Hedge_Of_The_World
4
Welcome To The JungleHey guys! So, let's get right into it with today's analysis. US Futures are trading slightly off the week's highs, as Asian and European markets slipped around 1-2 percent overnight. Jobless claims came in better than expected with 709k new claims and approx. 6.8MM continuing claims, while pandemic emergency claims continue to spike. Consumer price growth slowed notably, with CPI and core CPI coming in at zero percent. YOY CPI is now at 1.2 percent. The 10Y yield lost some steam overnight, and is sitting just off it's recent high around .93. Morgan Stanley recently said they expect a sharp rise in yields, imminently, and if you look at the 10Y chart, it's pretty obvious why they've come to that conclusion. The 10Y yield is up around 80% from the beginning of August. - SPY key supports to watch today are 349.93 (which is the 50 period MA on the hourly), 344.58 (the second gap to fill from the Nov 4th close), and 339.62 (the 50 day MA). - The daily RSI is sitting at 64.78 which is showing we're getting close to those overbought levels. We just about hit an RSI of 80 on the hourly on Monday (79.97). - Vix is back to a 24 handle after some weakness yesterday, and saw it's lowest hourly RSI print in two and a half years this week. Needless to say, risk protection is currently heavily oversold on the hourly. - DXY is sitting around 93 at the moment, and is just begging for a shift in sentiment before it's epic return as King Dollar. Best of luck out there today guys! If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research. PS No live updates today unfortunately, I'm in the middle of moving so I have a lot on my plate, unfortunately. Cheers, Michael.
AMEX:SPYShort
by Hedge_Of_The_World
8
10 Things I Hate About You (Comedy)Dear Mr. Market, 1. I hate the way you always seem to rise, even when you're supposed to fall. 2. I hate the way you make me scratch my head, when price action makes no sense at all. 3. I hate the way you brand me a contrarian, even though we all know the real economy is dead. 4. I hate the fact that you only seem to move, off of sentiment from the FED. 5. I hate that you give me road rage, when pushing my shopping cart at the grocery store. 6. I hate that you no longer care about fundamentals, and now you've made technicals a bore. 7. I hate the way that price action now controls sentiment, and not the other way around. 8. I hate when you squeeze me out of my short, even when support clearly hasn't been found. 9. I hate your stubborn attitude, when all the facts that are stacked against you stand tall. 10. But, most of all, Mr. Market, I hate the way I don't hate you, not even a little, not even at all. Yours Truly, The Bears
AMEX:SPYShort
by Hedge_Of_The_World
28
Don't Look DownThe global market rally/gap fiesta that played out over the past week or so, came to an abrupt end yesterday as we approached the close. SPY almost filled the massive overnight gap, and ended the day back below the long-term (multi-year) resistance line around 355, after achieving new all-time high's. Looking at the monthly SPY chart after yesterday's rejection, traders might be starting to get that, "don't look down" feeling. I think it goes without saying that trading with caution at these levels is prudent. As I've mentioned in previous posts, technical analysis is becoming increasingly difficult in a market that moves wildly off of immaterial headlines, and pure assumptions. But, we will continue to use technical analysis (and fundamental analysis), among others, to assess the state of the market, and future price action. The top of the megaphone pattern is the final line in the sand for the bears. If they fail to keep us below this level, and we see a breakout above on the monthly, we would need to reassess our outlook, and bearish thesis. However, for the moment, the technicals are still holding up, and the bears have a strong case. Stay tuned for live updates throughout the day, and best of luck out there! If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
AMEX:SPYShort
by Hedge_Of_The_World
6
Up, Up, And Away!Another day, another short squeeze. Stocks are surging to new all-time highs this morning, off the back of positive vaccine results from Pfizer's latest trial. "Dr. Jansen said the outside board did not say how many of those cases came from participants who had been vaccinated. But with a rate of more than 90% effectiveness, most had to have been in the placebo group.” That doesn't sound like very exciting news to me. But, I digress... SPY gapped up this morning (again), and is now up a cool 3% to start the week, because everything is awesome! Technical resistance levels, be it long-term, or short-term, don't seem to matter to investors, with this new level of panic FOMO that's gripping markets. Price action during trading hours is muted at best imo, while all the action seemingly happens in the overnight session. Gap up, after gap up, after gap up, after gap up. Can anything stop this never ending debt binge, and risk free-for-all? Will stock prices ever accurately reflect the value of the underlying asset, again? The logical answer is yes, but it sure doesn't feel like it's going to happen anytime soon. FB and AMZN are getting hammered, while MSFT and AAPL are flat on the day. Vix continues to get clubbed, in one of the most vicious corrections I've seen in a while. But, we're holding up relatively well as investors digest this "WTF" moment. Good luck out there today guys, and trade safe. If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
AMEX:SPYShort
by Hedge_Of_The_World
7
November RainHey guys, Happy Friday! No gap up today (for a change), and we appear to be forming an island reversal pattern at the top of the triangle (350). We're seeing some weakness today off the back of a possible Biden victory, but most of the overnight losses were reversed after a stronger than expected payrolls print. Some of you might be wondering why Vix is down today over 4% today, while markets are all in the red. This happens sometimes when Vix is at elevated levels, and the market calms notably. Vix has a very erratic negative correlation with equities. Every once in a while, when we're seeing Vix above 30-40 let's say, like we were recently, and the market goes from falling 4-5% per day, to falling just 1-2% per day, on the latter end of the sell-off Vix will be down notably, as markets also fall 1-2%. Realized vol is falling, and so regardless of the fact that markets are down, vix can also be down. Good luck today guys, and enjoy your weekend! If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
AMEX:SPYShort
by Hedge_Of_The_World
61
Assume Crash PositionAnother massive gap up overnight without a material change in the outlook. Fourth short squeeze in a row of near identical magnitude. A relief rally was always possible after the recent correction. But, this one was much larger and more vicious than I had anticipated. We're up over 7% in 4 days. That used to be a decent annual return. But, price action is driving sentiment at the moment, and wild assumptions, and optimism based on those assumptions, is validating price action. In other words; the cart is being put before the horse. We're approaching the final resistance levels here at 350, which is the top of the triangle, and 354, which is the long-term Green trendline we lost on Oct 19th (it's also the previous high from Oct 12th). If we break above these levels, imo it would mark the official end to the bearish thesis, based on my technical analysis. I expect to see a strong rejection at these levels, followed by a swift correction back to low 320's, where we may see an interim bounce, before a resumption of selling down to the 300 level. Best of luck out there today guys, remember to trade tight stops, and always hedge against risk in uncertain times. The FED is not your friend, and market makers are happy to take the opposite side of your longs right now. If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
AMEX:SPYShort
by Hedge_Of_The_World
27
Stocks Explode, Nasdaq HaltedThe Nasdaq was halted overnight as the index surged up to 4% higher off the back of a stronger than expected performance by the Trump Camp. Apparently, the odds of a "Blue Wave" have all but collapsed, and this bodes well for Mega-Tech and growth stocks. Uncertainty around a contested election was also abated, off the back of a relatively orderly night of voting, which put clear pressure on hedges such as the Vix, which is down as much as 13% this morning. I think it goes without saying, that nothing material has changed since yesterday night when the voting numbers began to roll in, other than the price. Then off the price action, we get narratives to validate the move. This is not how it's supposed to work. Millions of votes are yet to be counted, and they're Biden weighted, so this election is still very much up in the air, and likely going to be contested imo. But, perception is everything, and when the price moves, it changes our perception of risk. Technical trading is becoming increasingly difficult in a market that moves wildly off of immaterial headlines, and pure assumptions. We lost fundamentals a long time ago, but until recently, technicals held up well as an indicator of future price action. We will continue to use technical analysis (and fundamental analysis), among others, to assess the state of the market, and future price action. But, it's like drinking warm beer. I'll still drink it, but something's definitely off. SPY Analysis: SPY is poised to gap up to around 341 on the open amid the nuclear bullish sentiment we're witnessing across the globe. This level is key as it's right around the upper band of the descending channel. A break above this level would put us above all major short-term resistance levels, and could result in another squeeze to the 350 level, and the long-term Green line resistance we broke below on Oct 19th. If we get rejected at the top of the descending channel, we could revisit the lower band as early as this afternoon. Vix is looking very oversold right now. I can only speak for myself, but I'm still net short, and hedged for the worst case scenario. As far as I'm concerned, nothing material has changed, not even the losses in my portfolio over the past 3 days are material. I'll share these trades with you guys the moment I unwind them, and it might be as early as today, depending on whether or not something material actually changes. Let's see how the morning session plays out... Stay tuned for live updates throughout the day, and best of luck out there guys! If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
AMEX:SPYShort
by Hedge_Of_The_World
7
There Will Be BloodGlobal markets continued to march higher overnight, with US futures up around 1%. The Vix got hammered back to a 35 handle as the current risk premium soars to all-time highs. S&P Futures broke above the 100 day MA (3312.25), after persistently testing this resistance level over the past 3 trading days. We kissed the 9 day MA at 3349.40 around 4AM this morning, but saw a clear rejection. The 9 day MA also happens to be right around the 200 period MA on the hourly (3351.91), which sets us up for bearish price action following a rejection at these key resistance levels. Depending on the angle of the former downward channel sitting just above the current price, it's also possible we saw a rejection off the bottom of the channel around 3349, strengthening today's bearish thesis. Notes: - It's election day! Headlines of "violence in the streets," are circling the MSM today (possibly to deter voters), as if the possibility of catching COVID-19 wasn't scaring people enough. - Morgan Stanley says rates are about to rise 100bp. When I said this a month ago, and discussed the 10Y yield rising (now up 65%) since August, it sounded crazy to most ears. Especially, when the FED had all but guaranteed "low" rates into 2023. Here's the article on ZeroHedge, www.zerohedge.com - The Dollar appears to be on the verge of a breakout, which could pressure risk assets further heading into year end. (We just tested the 100 day MA for the first time since May). - According to Christian Stocker, UniCredit Lead Equity Strategist, the market is currently betting on a Biden win, and the polls all seem to agree. But, will we see another 2016 surprise? Stay tuned for live updates throughout the day, and best of luck out there guys! If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
AMEX:SPYShort
by Hedge_Of_The_World
31
Stocks Sharply Higher As Election Week Kicks-OffGlobal markets are trading sharply higher at the start of a very busy week. Mainly, the US election is tomorrow, and also 128 companies in the S&P report earnings. October payrolls are due this week, which will help reveal how businesses are positioning for the winter season. The FED & ECB are both announcing their latest policy decisions, which could greatly affect the global macro outlook. I'm expecting to see a continuation of the sell-off from last week/month, and a spike in volatility off the back of increased economic and geo-political uncertainty. The Vix has persistently traded at elevated levels (weekly RSI is showing lots of room to the upside), and market sentiment is particularly fragile at the moment. With very few technical supports holding up asset prices, and a slew of negative catalysts circling global markets this week, things are about to get very interesting. SPY Analysis: After hitting it's lowest level in over a month on Friday (322.60), and then rebounding to close the week around 326.54, SPY is now back at it's 100 day MA (330.18) in pre-market trading. We saw a clear rejection of the 100 day MA on Thursday, and then again on Friday. Let's see if the bulls can get us above this important line in the sand, or if we see another rejection, which could result in a swift sell-off down to the 320 level (Sep 24 lows/June high's). If the bulls successfully break us above the 100 day MA, the next major resistance is at the bottom of the short-term Green downward channel around 333.40, which was a key support that we lost on Oct 28th. Stay tuned for live updates throughout the day, and best of luck out there guys! If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
AMEX:SPYShort
by Hedge_Of_The_World
4