Today WOULD have been quite interesting, had it not been for the damned buy-the-dip crowd. One area, however, that’s really starting to break down (and which I’ve mentioned with increasing frequency on my tastytrade show) is high yield bonds. Check this out:
Starting in early 2016, the Brazil ETF symbol EWZ roared almost 200% higher based on……..what…….a big surge in personal shaving services? I’m not sure. But their stock market went insane, shoving away anyone foolish enough to be in their path.
My view is that this surge is at the cusp of failure. Here is the broad SlopeCharts (why aren’t ALL of you people using this product? It’s FREE, and it’s FANTASTIC!)
By far my favorite options position is consumer staples, symbol XLP. Yesterday, as I mentioned on my show, I took profits on 30% of the position, because I felt it was about time for it to retrace back to its neckline. Sure enough, that’s what it’s doing, and I’m glad to be a little lighter. I want to be clear, however, I intend to get back in full-force……..maybe even bigger than before………once we get back to that zone of resistance. This is a honey of a pattern.
Having a very good day, for obvious reasons. I’ve got 50 shorts and 12 puts, all of which are profitable. A favorite equity short is Nordson, shown below, which looks like it’s about to U-turn lower once more.
I think real estate is screwed and tattooed. For those who want an instrument to take advantage of this, you might consider triple-bearish-on-real-estate fund DRV, which just had a bullish breakout today.