One would think that with yet another all-green-in-the-morning screen, I’d be kind of bummed about the day ahead. Not so! I’m feeling very in synch with this market, and what’s going on in front of us lines up nicely with what I’ve been anticipating.
First off, there’s China. Last week, on Monday, I went whole-hog buying puts on JD, YUMC, and PDD. I made nice profits on those first two, although way too early, but I held on to PDD for a triple-digit (about 112%) gain. I sold almost all of it off yesterday but held on to some just because it doesn’t expire until January 17th and probably has more downside. Short-term, however, I decided to get very light on China based on the $HSI gap I have written about lately. The notion that China has bottomed short-term seems to have been on target, as FXI shows.
I’m bullish on silver, as I mention every few hours, and we’re having a good morning there with an over 2% gain on future. This is far and away my largest position, but I intend to make it much larger as strength builds.
What I am anticipating, hopefully even before the end of this month, is a breakout from the base we’ve been building. The circles suggest the analog.
The media, and permabull ZH in particular, is absolutely slathered with articles saying precisely the same thing: that there’s going to be a GOP sweep on 11/5, and coupled with seasonal tendencies, the market is absolutely going to soar into the ionosphere. Could be. The daily pattern on the /ES shown here is indeed quite bullish.
All I know is that my short positions are holding up great. I feel like I own a big dish of ice cream on a blazing day in the desert, and every time I check back in on it, the ice cream hasn’t melted.
Anyway, it looks like yet another day of lifetime highs, but as always, let’s take things one position at a time.
