Slope of Hope Blog Posts
This is the heart and soul of the web site. Here we have literally tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. You can also click on any category icon to see posts tagged with that particular category.
Sheesh, what is with this market? Tuesday was awesome for me. Wednesday was absolutely horrible. And now today, Thursday, is going great. Could the market make up its mind? No, I’ll go one better. Have the market go down 2% daily, every day, until it is 0. That’ll suit me nicely. This up/down/up/down stuff is driving both the good guys (the bears) and the wicked evildoers (the bulls) out of their respective minds. It’s sick.
Anyway. I wanted to share a couple of unrelated short ideas (tied together by my clever post title). The first is the financial sector, XLF, which gapped down nicely where that circle is shown. This sector peaked back on January 29th, and its gap is at 27.72. I have so many bank stocks in my portfolio already, it would be redundant for me to short this one too, but it’s a cool chart.
Well, I’ll shut up about the oil gap and turn my attention to something even more important: bonds. Treasury bonds have been roaring higher all week, and that’s not great for me, because my entire options portfolio is oriented toward stronger interest rates. (IYR, TLT, XLU). Relief may be at hand, however. The gap at 120.28 is powerful, and my view is that within a month from now, we’ll have pushed below even the lows we saw earlier in May.
Given the crazy moves interest rates have been making lately, I thought we’d check in on my trio of bearish positions (by way of being long January 2019 in-the-money put options). Below are all three, with an arrow marking my “uh-oh” spot when things would turn wrong. So far, they haven’t, but I’m wringing my hands a bit more than I used to. First there is the Dow 15 Utilities:
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In sharp contrast to the likes of, say, small cap equities, one financial instrument which has been reliably sliding, week after week, month after month, continues to be the emerging markets bond fund. I have managed to lay out five successive horizontal lines indicating its diminishing levels of price resistance (typically based on a gap down).
If you think I ever stop thinking about Slope, just look at the side of my pool. As I am doing laps, whenever I have an idea, I grab a chlorine tablet and scrawl it on the side. By the end of my little workout, I’ve usually got a bunch.