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Premiums on 3/27 270p were being shred all through Feb, but it meant squat in the end. 6/17 275c were being eviscerated 3/16- 3/21, but it meant nothing in the end. I’m used to burning a lot of fuel and bait when going Marlin fishing.
60’ , 4hr, both maintained Key ( S ) levels, but I’ve said before, and I’ll say again, I think we will see a BIG GAP DOWN that will shred all S levels in one fowl swoop. Not saying that it will be tomorrow, Friday, or any particular day, but I do believe it’s coming, and could be any day now.
Way way too much “ Great Depression “ type numbers coming out to keep the cognitive dissonance going.
I noticed you’re buying “ in da $ “ contracts today, more cautious ,not clear enough signals ?
30’, 60’ just failed , could be interesting close
Beige book; it says “ depression” , SPY says “ oh, News ! “ , but then it will digest the news and it won’t sit well on the stomach.
Bonds have been leading the way, along with Russel, and IF that is true, it’s gonna get nasty going into EOW.
Good call, Spy 60’ failed to clear key line, and I suspect that could lead to a new LOD
15’ closed above S1, but S2 is barreling down hard , and could easily reject price down
60’ closed above (S1), but (S2) directly overhead , and should SPY fail there, watch out.
Daily gap painted again
60’ failed ( S ), 271 next ?
30’ held ( S), 15’ did not, 60’ TBD
Yes, and the paint only shows on daily, no other smaller fractals
I don’t dispute that old trope, because I’ve lived it and learned it the hard way, HOWEVER, this isn’t just “ bad news”, the numbers are horrific. That said, spy did go up 3% today, I really do think the ability of Baghdad Bob to say the Americans aren’t in the city limits, is gonna get more and more perilous.
Dang! That’s scary bad, very very scary bad. Remember, that’s with only one month ( out of three) of real Covid effects , if that, and NOT EVEN INCLUDING the coming DEFAULTS . Wow o wow, and what, SPY is supposed to go up 3% like , “ oh well, no big deal “ , whew. This is going to have the mother of all reckonings.
Yep, he’s not always 100%, but he’s real, and gets it right a whole lot more than he gets it wrong.
Get Excited LT Put Holders, get excited! Because, the pain you are enduring here , seeing this faux “ hope and intervention rally “ ~ NN, is a very ephemeral thing, that will lead to an ethereal thing.
He’s still fng nuts ! In a great way
It in some way already has “ propped banks “, by signaling to them, through their series of programs ( ocean of liquidity ), that we “ got your back “ to banks. But, all the Kings horses and all the Feds programs, can’t stop the damage that has already occurred from this shut down. The titanic didn’t have scuba divers on board, for if they did, those folks Seeing the hole in the boat, would of died from heart attacks, way before hypothermia - drowning.
Same principal here, if we had a true number of the damages already occurred from this shut down... there would be no talk of “ V “, “ U “ , “ W”, or “ L “ , as they would realize that fed liquidity can’t fix that size hole.
That ellipse area on your chart, is about exactly how I see it. With an initial drop from this bear rally, making everyone think the world is ending, big boys sell the pi$$ out of put premiums , reverse on ( S ) , sell the pi$$ out of call premium , and then reverse again on (R) , for another trip down to new low, and in about the time scale you show.
Well , “ portended “
ALSO, perfect title : “ HOPE AND INTERVENTION RALLY “ ! Love it !!
Lol, I love it when they say that. “ yeah, no worries, businesses being shuttered for months is... already priced in”.
Which is funny, because NO ONE even can begin to know the true scope of the costs this shutdown will bring.
And James Bullard ( changes his opinion w the St Louis weather ) , now says , “ a V recovery is possible “,
L-O- FNG - L
He just was talking massive recession ( depression ) three weeks ago!
And he’s a Fed Chair ?!
Wonder what UE claims will look like this Thursday? Could be another 6mm + , which will make, what , 20mm New UE claims in a month? Yeah, no problems with the economy , SPY price low here, keep buying!
Any up = further off the cliffs edge, WYLEE - COYOTE Style
We said “ more bear pain “ may be needed before a drop, and that’s what this is, for anyone holding puts. SPY Just trying to feign a “ melt up “, slow torture period, but this is NOT that, only a deke to get shorts relenting and pull in more long $ .
I said this weekend , “ 60 % chance drop starts sometime this week” , and “ 90% chance it starts within two weeks “
A gap up on the 1’ ! Lol, 1’- 15’ showed a tight flattening, knew a bigger type move was coming , just wouldn’t of expected it to actually gap higher. Still roping in long commitment apparently.
You seeing the 5’ here ? Eerie
Daily Momentum indicator went from lowest level ever recorded, to highest level ever recorded, which means there should be a return to the median. The median should equate to Apx 257- 263 price handle range.
IMF issues “ depression warning”, but SPY well up today, go to love it ! The move up is not unexpected , as so stared last week. Equally expected should be the coming drop, just depends on how many SPY has hypnotized into going long. Once enough interest shifts to the “ all clear “ mode, then expect a sudden and voracious drop.
IMF issues “ depression warning”, but SPY well up today, go to love it ! The move up is not unexpected , as so stared last week. Equally expected should be the coming drop, just depends on how many SPY has hypnotized into going long. Once enough interest shifts to the “ all clear “ mode, then expect a sudden and voracious drop.
Morgan Stanley now predicting summer, before even the first wave of employees will be able to go back to work, and then another wave of workers in mid summer. Ask yourself this,
can this Country afford to stay shut down that long ?
If so, What will the Economy look like in a post-Covid , full return to “work”?
How much damage , permanent damage , will result ?
This is why I keep saying, the Economic iceberg has already been hit.
What will the UE numbers look like in 1 month?
How long can Banks put off reporting defaults, late pays?
How long can secondary lenders put off reporting the scope of their losses, and why would they; secondary lenders aren’t bankers, and as such have not nearly as much loyalty to the Treasury Dept ( aka Govt. ) as banks do?
How long can the Fed keep creating new “ programs “ to sustain all small business, individuals, corporations ?
How much longer can somewhat rosier looks, vis a vis, this crisis, be sustained?
How quickly in 2008 did things go from , “ meh “ to “ end times” ? I’ll answer that ... One Weekend.
I’m even optimistic the virus itself will not be an issue too much longer, as in people here will just say, “
Enough !” , snd / or amelioration drugs - vaccine news will get better, but...
The economic ice berg had already been hit, the ship is taking on water at an alarming rate. The question now is not, “ how many months to recover” , but it’s now , “ how many quarters - years , to recover “ , and the news - numbers , will get much worse before they get better. The damage to the financial system will not be fully realized for weeks / months , and there is no sudden “ restart - jumpstart back to normal “ , unless ....
The Govt wises up and starts flooding consumers ( John and Jane Q public w money ) , snd even that is a temporary fix, as behaviors could now be permanently changed.
Any recovery is going to take time, and before a recovery can start, the depths of the damage must be fully realized; we are no where near knowing how much damage has occurred.
I’m optimistic too, but 13mm UE ( not even the true real time # ) in three weeks , w bailout funds already exhausted in many cases, all within three weeks = SPY 300 ?
I don’t like fundamentals, but just saying the above out loud to oneself should make clear why any SPY continuation up just seems further off the cliff edge, WYLEE Coyote Style.
Lol, good insight, you see through the lines. Yes, everyone talks their own interest, at some level, and corps are no different. The number ( 40% reduction in 2nd Q GDP) has not yet sunk into the market, nor have Jamie Dimons words. People also are ignoring Bill Ackman’s comments on the day of the current low; although, he lost a lot of credibility after his Herbalife short. These things are real, a depression ( massive recession ) will be an effect of this shut down. When, and how the realization occurs for the market is unknown, but I suspect the bad news will be ignored, until it’s not . I used to use the phrase , “ Sudden and Mass Realization “ , and I think it’s time to dust - off that old troup.
Yes, Time is the most valuable part of any contract, especially now.
One thing bothers me about puts : it seems many are now expecting a retreat down, to at least some level. There is a Large short % now in the markets, and that is what I don’t normally like seeing. We may need to see a quick, lose your religion, short squeeze burst up , before any drop. I think, IF ( cap I , cap F ) we see any squeeze , it will come fast, be severe , but very short lived.
Still thinking we see a directional shift to down, most likely starting this week. If not, then almost certainly within two weeks. Either way, holding LTPs may be a bit nauseating before vindicated. Just keep nerves and DCA
“ it’s still just a forecast” , AMEN THAT ! And the sweat - self doubt that manifests as a result of going deep, seeing SPY go strong against, but still holding through, well , that chit will test someone’s resolve.
Ex; in 2018 , Late Jan. I got short w LTPs and was set, sat through day one of the drop, and sold at EOD, w a decent profit, but NOTHING like I would of seen by simply ignoring SPY and just going on vacation for a couple weeks. The reason I sold was I let SPYs past performance ( destroying the shorts ) influence my decision; I got scared.
Same can be said of my recent long position , I sold way way too soon, because I was influenced by the depths of the recent drop.
Emotion is real, a real pi$$er that is! I’m better just picking my trade and ignoring completely. Easier said than done.
Good news - Bad news , Covid :
The GOOD news is Americans get bored, easily. Meaning, rightly or wrongly, I think the masses will be “ done with this Covid chit! “ . That’s a testament to America’s “can-do” spirit. So whether Covid is still actually a threat , or not, the zeitgeist will shift to “ F it , were getting on with business “. There will be costs - pitfalls to this attitude, but I still think it will be the way it is, and most likely a positive thing, ADR to those lost, afflicted, and the families - loved ones of. This IS America and we do not lie down, and that is what sets us apart.
The BAD news : the economic damage is done, and growing exponentially everyday we stay in this current mode. The true realization of economic - financial damage will continue to unfold and progressively get worse. The real questions are; “ has too much damage already occurred, are we in a financial crisis, how bad is the financial crisis , is the financial crisis growing ? “ the forlorn answer to these questions is YES.
Another issue will be “ getting back to work”, as there is no switch you flip to make the Economy suddenly go back to where it was prior to Covid; restarting will be a slow process.
The depth- breadth of this news probably won’t start to really roll out for weeks - months from now, as corps - financial institutions can avoid reporting the true data for a while. Banks are rolling out in time people’s payments for mortgages - unsecured debts, thus prolonging the true, real-time reporting of the actual damage; skew the data . Loans won’t have to technically be reported as defaults or even late for some time.
* ADDING TO THIS : Before ( prior to ) Covid, the amount of consumer debt levels was at, or more than 2007 levels , so Covid isn’t really the sole contributor to the advent of our current financial crisis.
Exactly! How the F is $1200 gonna make people comfortable when they are without work, life suddenly upended , and no clear path forward ? Canada has it right! US govt ( instead of buying trillions in Corp junk bonds ) should give that to people , who are consumers , you know, the back bone of our economy. Some things never change.
Also, all mortgages should automatically be suspended for the next three months , WITHOUT REPAYMENT , and Mnuchin can compensate the Banks for their lost revenue.
I’m not a socialist, but damn it all, people need to feel assured that all be well when we get through this, and prevent strife , which never bodes well for social stability.
Correct, although my instinct says , start of drop THIS week, specifically Monday - Tuesday is higher probability than stated, just trying to not sound hyperbolic
NNs call to 290-300 may not be wrong either, although I think SPY will not get quite that high, but I am fully prepared for more bear pain , before any drop.
I’m thinking
Start of drop at open : 15%
Start of drop intraday Monday, after a move up and/or Gap up: 25%
Start of drop at some point this coming week : 65%
Within two weeks: 90%