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.
In a recent post (“A Brazilian with a Sudden Rip of the Wax”), Tim noted that Brazil ETF EWZ was in free fall. For those who haven’t been keeping up on the bad news from Brazil, the headline of this AP article from Tuesday will give you a sense of what’s been happening: “Brazil’s economy plunging; no relief in sight amid political, financial chaos”.
A Hedged Bet Against Brazil
Every trading day, Portfolio Armor ranks all of the hedgeable stocks, ETFs, and other exchange-traded products in the U.S. by its estimate of their potential return over the next six months, based on an analysis of price history and option market sentiment. Then it subtracts hedging costs, and ranks them all by potential return net of hedging costs, or net potential return. On Tuesday, the highest-ranked ETF, and the 6th-ranked security overall, was BZQ, the 2x levered bet against Brazil. Portfolio Armor calculated a potential return of 15.2% for it over the next six months.
Early in 2013, I did a laudatory review of the Tesla Model S (at which time, if I had any sense, I would have loaded up on the then-$40 stock), and I continue to believe it is the best car I’ve ever had. Around the same time, I put $5,000 down to reserve my spot for the Tesla X SUV. This product has been delayed for a long, long time, but Elon Musk promised it would start shipping in “Q3 2015”. I cynically predicted he’d probably roll out one vehicle on September 30th, and I wasn’t too far off: he rolled it out the day before. That is, last night.
I got an invitation to the event, which was held at the Tesla Factory. It’s been many, many years since I’ve been to anything resembling a product intro, so I decided to go. I drove over the Dumbarton Bridge to Fremont, and I joined a fairly large crowd of other people who had also received invitations.
Today the Emini S&P 500 should provide clues as to whether or not yesterday’s low at 1861.00 represented a significant corrective low off of the Sept 17 Fed High at 2011.75.
As of this moment, my pattern work shows a near-total traverse of the bearish down channel carved out since mid-Sept.
From a purely technical perspective, the dominant trend remains down, and will continue to do so, unless, and until, the back of the downtrend is violated– first with a climb above resistance lodged between 1906, and the upper-channel boundary line, now at 1915, and thereafter, with a climb above the prior major recovery-rally peak at 1951.00– to confirm that a major-trend reversal has occurred.