Taking Penn in Hand

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I normally have an extraordinarily relaxed trading environment, with lots of computers, even more monitors, my dogs, my chai at hand, and all the comforts of home. Managing Slope and my trading in the midst of air travel (with driving, parking, luggage, airport security, lame WiFi, relatively cramped quarters) sucks out loud. I make a point of traveling first class, not because it’s particularly nice, but because it at least makes the travel crappy instead of shitty. All the same, it’s super hard to feel the rhythm of the markets while dealing with all this nonsense.

Now that I’m here in a gym at Penn State, even with all the screaming going on around me, I can calmly reflected on what I see, which is why I wanted to share a few thoughts about what took place over the week.

There are two important events that took place with the /ES. The first one, on Wednesday, was the FOMC spasm. I believe this will inform the market for weeks to come, and it helps restore power to the bears. The other, on Friday, was the fact that the /ES was stopped hard at a major Fibonacci retracement level. It was beautiful to see. Yes, all the futures closed deep in the green on Friday, badly tarnishing the heretofore unblemished reputation of Bear Force One’s power, but I consider it a victory nonetheless.

Take note of how weak the /NQ is relative to the /ES. Even in the midst of the bullgasm that took place following the jobs report, you can see how the rally was oh-so-not a big deal. I believe we are well positioned for the week ahead.

Regarding precious metals, just slip a pink dress on me and call me Peaches. I was lambasting all precious metals loudly on Thursday, declaring their persistent suckitude, and then they go and turn around and roar higher. Don’t get me wrong: l want precious metals to soar, shine, and roar higher. I’m a fan! To me, gold thriving is a huge kick in the nuts to Powell’s ball sack, and of course I celebrate it. It’s just that I’ve been burned so many times by gold, I’m a closet hater. All the same, congrats to you gold fans out there. I trash talk it, but I still want you to win.

One other telling thing about the week was how week bonds continue to be. Equities may try to rally here and there, feeding the hopes of the Dave Portnoy airheads of the world, but bonds ain’t buying it. The entire global economy is on a slow train to disaster and bonds, as usual, are smarter than equities about what lies ahead.

I will say one good thing about my trading being hamstrung on Friday: it prevented me from making a stupid trading decision (please note, about 73% of my trading decisions are stupid). You see, I was long puts on Live Nation (LYV) and they came out with earnings Thursday night. The stock went popping higher, and it remained quite strong Friday morning. I said to myself, “I’m getting out of that crap”, but things were just too muddled to take action. It started slipping, so I said, screw it, let’s see how this goes. Mercifully, I didn’t touch the position, and the stock just got weaker and weaker, in spite of the idiotic rally that closed the day on the market in general.

Had I closed the positioned, I would have kicked my own self in the nut sack (we seem to have a theme here; see above) because LYV looks more fantastic than ever. I am delighted to own these puts!

Regarding the week ahead, I’ve got 18.5% cash, so I’m ready for a few new positions and to beef up some favorites. The monster event this week is Thursday morning’s CPI which, God willing, won’t be the bear-raper that the last one was. May heavenly father continue to smile upon his ursine children and smite the bulls and their machinations.