Dec 16

A Great Month of November but Weakness ahead?

November turned out to be a great month. It was also the best month for me. But the last day of the month gave some indication that there could be some weakness the next few days. The expectation is the market will take a breather and then march right on to give us a great December as well. But one has to be cautious. Let’s see where the markets are:

SPY: still looking bullish

IWM: bullish but price crossed below the 10-day moving average; could be temporary but certainly something to keep an eye out for the next few days

EEM: still bad and does not look like will change any time soon

XLF: bullish and looking good

XLK: slightly bullish but dipped below the 10-day moving average so there is some weakness

XLE: ripped 5% yesterday and went dramatically bullish obviously based on the OPEC agreement

XLU: looks bad

XLI: bullish and looking good

Nov 16

Fear and Greed and Hope?

It is very surprising how many people, including the pundits, can be so over consumed with their theories and predictions why the market should behave in a certain way. These are people who, even when they see the market behaving a certain way, will stick with their assessmnt of what should be happening.

Some of this is happening now. The market has been going up in a straight line since the election and many are calling for correction. I am not suggesting the correction will not happen – just that I have no idea. If it does come I will do the needfull. And if the markets keep going up I will do the needfull as well.

Anyway, enough talk, let’s see the trends:

SPY: bullish and looking strong

IWM: bullish

EEM: still broken but trying to trend up

XLF: bullish

XLK: breaking towards bullish, looks much better than last week

XLE: bullish

XLU: bearish and broken

XLI: bullish


Nov 16

Every Market is Looking Good, What Now?

Markets have generally been on a tear. I want to look at the basics again this morning to see what the trends look like especially since this morning it looks like the market will open to the downside.

SPY: bullish ans looks steady as of now

IWM: bullish and looking good

EEM: completely broken and looks really bad; I will not go near this

XLF: Trend remains bullish

QQQ: has not yet really turned bullish, trend still looks neutral, wondering if they are going to join the party or not

XLK: just touching the bullish trend but not yet; today will be important to see if it breaks out to the upside

XLE: looks nicely bullish

XBI: in danger of turning bearish at this point

XME: nicely bullish

XLU: very bearish

XLI: very bullish

GLD: completely broken, this one is going down


Nov 16

Market Trend has Reversed to the Upside

The markets have completely turned around and the trend is bullish now. There is some fear that it has risen too much too soon. But in my opinion, the trendlines are clear and for the most part the rise has been orderly if one discounts the after hours midnight trading on election night.

I have reversed all my positions and anticipate the rise to continue for a while.

SPY: has turned bullish; I am long SPXL

IWM: same as the SPY – has turned bullish; I am long TNA

EEM: completely broken and with dollar headwinds I would stay away for now

QQQ: bearish; perhaps because of perceived positions of President-Elect Trump

XLF: hugely bullish; I am long FAS



Nov 16

The Election Trade

From all indications it looks like Hillary Clinton will win the election tomorrow. What is really interesting is whether the Democrats will also take the Senate. Right now it looks that way. If that happens it would be a strong mandate for Hillary. The House seems like will still remain Republican. So, the overall givernment will be split. However, having the Senate behind her may make stronger and the expectations from her first 2 years could be higher than normal.

The general concensus is that there will be a bounce in the aftermath of a Clinton victory. In fact, the pre-market numbers look like there will be a very strong bounce of the lows we have seen.

From the trends perspective, SPY is still very bearish. IWM could be looking to bounce. EEM looks bad. The Technology sector (XLK and QQQ) both look bad. The XLF is neutral. The XLE is broken as well.

XLV and XBI both look broken and will likely have a negative impact even if Hillary wins. I am long puts on both of them.

I am positioned bearishly in the market but will look to trim if I see the trends turning for real.

Nov 16

Market Going Down Protect Yourself!

I took both my SPY puts and the IWM puts off with gains of 86% and 145%. I got into EEM put trade and a XLV put trade yesterday as well. I am very bullish on Square (SQ) and had got into a straight stock trade just before the earnings call on Tuesday. The stock is up about 5% since then. Usually I do not do straight stock trades. But SQ was trading at around 11 and it did not make sense to trade options. I am bullish about the company but may not hold on to it because I expect the market to go lower.
SPY: I closed my November puts and will roll over into the December puts if the market goes up a little today. I feel there is still around 5% downside to the market remaining.
IWM: looks exactly same as the SPY which is to say really bad. Again, I closed my November put options but will likely get into the December puts today or tomorrow.
EEM: bearish; I made a bearish bet yesterday using December put options
XLF: keeps drifting lower and moving towards a bearish zone; so the hope that Financials will pull the market up is diminishing
XLK: definitely looks in bear territory; may get in with a trade today
XLE: bearish trend
XLV: completely broken; I got in with a December put trade
XLU: massive break yesterday to the downside; looks like it will go lower
XLI: bearish
XBI: completely broken, tried getting in with a December put trade but could not get my price
VIX: seems unstoppable at this time
GLD: getting bullish as the market thinks this will be a safe haven

Nov 16

Market Is Broken!

Market is broken and it is time to play the downside at least till the election which is a few trading days away.
SPY: broken bad; looks to be trending below and will likely keep dragging the market down. I am long the November puts which are holding some healthy gains so far; I contemplated taking my profits yesterday just before close and then did not as the market really looks broken
IWM: the trends looks exactly same as the SPY; again, I am long the November puts and holding some good gains on it
EEM: somewhat bearish; looks like it has held itself somewhat so far but risk to the downside is more than any chance of upside
XLF: interestingly this is finally starting to go down in sync with the broader market; there was some hope that the financials would take the market up but that hope is fading
XLK: just broke to the downside yesterday and looks bearish
XLE: bearish trend
XLV: completely broken; I may get in a bearish bet today
XLU: seems to be the only odd one out; trending bullish
XLI: trending bearish
XBI: completely broken – maybe because of the politics around this sector; I may get in with a bearish play
VIX: extremely bullish and looks like it is going to break the 20 number; I do not want to trade it though because it is really volatile as its name suggests

Nov 16

Market Trending Down

The markets continue to trend down and my put options in SPY and IWM are well in the profits. I am going to continue to hold them with an eye out to 18 November which is their expiration date.

Both the SPY and IWM are trending in similar manner and look very weak. This is in combination with the VIX having back to back over 5% rise which is signaling the downward trend likely continues most of this week through the November 8 election date.

The election polls are also likely going to show that the race is tightening which means more uncertainlty for the market. There are plays for each candidate winning which I will look into later in the week.

Interestingly XLF (Financials) and XLK (Technology) have been somewhat of a good story with either a upward or neutral trend. It remains to be seen if these sectors bring up the overall market or swoon to take the market further down.

Both the XLV (Healthcare) and the XBI (Bio Technology) sectors have been pummeled and look really broken. XLU (Utilities) and the XLE (Energy) look neutral to me.

EEM (Emerging Markets) are still neutral but could be heading downward as well.

Oct 16

Markets on downward trend

The markets have been in a downward trend since my last post here couple of weeks back. I went long put options on the SPY and the IWM. I did not buy the SPXS and TZA as I had originally planned for as I wanted to define my risk and play a short-term trade.

The move down on the SPY has not been significant since my bearish trade. However, it has trended down. The move down on the IWM has been a little more pronounced and it could be the signal for the broader market to go down as well. I have November puts on both which are showing healthy profits as of now. I may close these and roll over into December puts if the trend is maintained.

To be noted is the fact that XLF is distinctly bullish while XLK and EEM are neutral. So, there is some risk that marjet reverses trend and starts getting bullish.

XLE is broken. XLU is bullish and XLI is bearish.

The VIX just trended up today again but is still low under 17 which is higher than where it has been for a while but still lower than what we would call a bear market.


Sep 16

Markets are Broken

The markets certainly look like they are broken – Fear is in. Next week may the right time to male the plays to the downside. Let’s see how our favorite tckers are doing:

SPY: very bearish; every high it is reaching is lower than the earlier high which tells me the market wants to take it higher but not with a lot of heart

IWM: bearish – not as bad as the SPY but still bearish

EEM: bearish

XLE: very bearish

XLF: completely broken

XLK: strangely neutral; I suspect it is becuae of the good showing from AAPL

XLU: bearish

XLI: completely broken

GLD: neutral to bearish

SLV: bearish

USO: bearish