Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

How to Become “The Better” Options Trader

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Who is the better options trader?

A.    Two Nobel Prize winning economists who founded the very model that options pricing is based on.

Or…

B.    A guy who thinks the market is like a giant poker game.

Of course, it's A … right? They are the geniuses, after all. I mean, they wrote the Black-Scholes options pricing model – the pricing model that every options trader uses directly or indirectly on a daily basis.

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Technical Analysis vs. Fundamental Analysis

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Durable goods orders 1-28-13Of the two main methodologies used to predict the future direction on
the price of a security, an index or even the economy, which is better-
Technical Analysis or Fundamental Analysis?  If I were forced to only
use one in my market analysis and security selection, technical analysis
would win hands down.  Fortunately, I’m free to use (and do use) both
TA & FA as both methodologies definitely have their pros and cons. 
Typically, fundamental analysis (FA) is used by those with longer-term
time frames such as investors or economists whereas TA has useful
applications in predicting both short-term price movements in securities
and markets as well as long-term trends.

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Hedging TLT

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A Bearish Consensus Growing On Bonds

In a post on Monday (“Hedging to a Hundred“), Tim predicted a ~15% drop for the iShares Barclays 20 year+ Treasury Bond ETF (TLT). There seems to be a bearish consensus growing on bonds in general. Also on Monday, in an interview on Bloomberg TV, GAMCO Investors portfolio manager Larry Haverty offered this warning for bond investors:

We
have a bond bubble… And the public, I am totally convinced, does not
understand it’s going to be possible to lose money in bonds

Haverty
didn’t make as precise a prediction as Tim, but it’s interesting to see technical and fundamental views align here, as Haverty becomes the latest prognosticator to warn about bond bubble.


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The Case For AAPL (by Springheel Jack)

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I have been talking every day about AAPL over the last few days and the reason for that is simple. Unless we are going to see a serious technical breakdown on AAPL the most likely place that the current decline would bottom out is at rising channel support on the weekly (LOG) chart, and that was finally tested on Friday. It is holding so far. Will it continue to hold? Hard to say, but the technical setup here certainly looks promising as I'll detail below. 

I was saying a couple of weeks ago that there was not yet a clear pattern for the AAPL decline, and that, as I've mentioned before, is often an indication that it is too early in the trend for the pattern to have become clear. Now though it is clear, and it is a bullish falling wedge. If the current low can hold then there is also very encouraging positive RSI divergence on the daily chart. What AAPL needs to do next is break up from this rising wedge, and if we see that happen, then the low should be in:

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