It’s an exciting pre-dawn, since yesterday was a fantastic day and today has all the markings of another one. Ever since Bessent pranced onto the stage and giggled about the China/U.S. trade deal (red oval below), which led to the market’s last orgiastic spurt higher, equities have been puking all over their lapels. It’s a delightful change. Duke agrees!
Of course, the Goldman Sachs-sucking permabulls over at ZH haven’t shut up about how everyone should BUY BUY BUY equities until just yesterday. Now they’ve shut their mouths and have reverted to their backup topic, which is how Trump is a total stud and badass and how Biden was like, old, or something. Clever, Tyler!
The most treacle-laden permabulls in Tyler-land is The Market Ear, which has made the insightful declaration that there aren’t many shorts around (e.g. Bearville: Population 1: Tim Knight).
There’s no hiding the fact that the SIXTEEN YEAR bull market is finally broken. Now that AI Mania has soured, there’s no reason left to pretend anymore. The /RTY broke its trendline weeks ago and is now making multi-month lows.
Same with the /ES futures.
And, naturally, the /NQ futures. I mean, come on, even mega-caps like Oracle have lost about 35% of their value. This isn’t a dip. This is a wipeout.
And since 99% of the “traders” out there have only experienced a bull market, their frustration is becoming acerbic. One chap over on /WSB succinctly summed up his opinion of Michael Saylor’s bitcoin scheme.
I am entering the day so short that I could jump off a dime. I have 35 short positions including – – for the first time in months – – a large IWM put position which expires today (!) that I bought yesterday.
Since we’re coming up on a weekend, people might be extra jittery. Days like this are tough, because you never know what your hero in D.C. is going to pull next to distract and dissuade. As always, I shall take things one position at a time and tighten stops appropriately.
Oh, and one last thought: “Never Short a Dull Market” has got to be the winner of the stupidest trading maxim in history (worse than ever Trade the Chart in Front of You). The market was incredibly boring on Wednesday when I shorted the bejesus out of it, and it’s been nothing but wildly profitable.
