Slope of Hope Blog Posts

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.

From Record to Rotten

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This is going to be one of those longish, therapeutic posts which is as much for me as it is you.

In spite of all my griping about screwing up trades, and leaving tons of money on the table, and the Atilla cell in my spreadsheet, etc., etc., I actually wound up Thursday with the highest portfolio value ever. I had stars in my eyes about securing a triple-digit percentage gain for the first half of the year. I was 100% bearishly invested and ready to rock.

Friday changed all that. I went from a swaggering, super-confident bear to a quivering, timid, 54%-in-cash nimrod. The vast majority of my profits are still intact, but let’s just say I’ve totally dispatched with my triple-digits dream, except inasmuch as for the year 2022 as a whole. Friday was, in fact, one of the worst trading days for me in the entire year, and as I’ve mentioned, just about the ONLY thing I did right with this “all thumbs” week I just had was sucking out a mountain of cash from my brokerage account a week ago so I didn’t hurt myself even worse than I did! So, yeah, a cash withdrawal was my most resplendent victory. Pretty sad.

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Rearview Mirror

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No one leads an optimized life. Did you go to the perfect school for you? Do you have the ideal friends? How about your spouse? Is there no one among eight billion people who could possibly be better? Yeah, that’s what I thought.

We don’t think about such things, except in the world of trading. Or at least I do. I keep track of my closed positions, just to see how things worked out afterward. Of the 157 most recently closed positions, want to know how many kept going up? 149 of them.

Below I show the biggest percentage gainers (if you care, the columns, from left to right, are underlying stock, days until expiration, underlying price, intrinsic value, strike price, expiration date, entry price, bid, ask, and then, the most important of all, the percentage change since I closed it). Why I do this to myself, I’ll never know, but……….let’s just agree we live in an opportunity-rich environment:

May the 4th Be With You

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If I was as good a trader as I am a chartist, I’d be extraordinarily rich.

Luckily for you, you get my charts and not my trading. So you still have a chance!

Let’s back up a bit. When I called it a day yesterday, the bulls got just the kind of Federal fellatio that they received at the last FOMC fest, which was on May 4th. If you’ll recall, that disgusting pig Jerome Powell stood at the podium and lied, prevaricated, and deceived, all to good effect. Equities absolutely exploded. Just like yesterday.

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FOMC Game Plan

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This is a selfish and a selfless post. It is selfish in the respect that I’m hoping to glean some wisdom from the crowd. It is selfless since it’s a decent amount of work to construct this properly, with the hope that some folks might benefit from the problem and its potential solutions.

Let me start with the situation and my assumptions:

  1. I have a substantial portfolio which consists of only cash and 30 bearish equity positions, by way of being long puts that expire no earlier than September and, on most cases, expire much later than that.
  2. I have 20% of my portfolio in cash. The portfolio overall is sporting a 57% profit so far this year.
  3. Over the past few weeks, I saw about 90% of my profits for the year go up in smoke, only to be restored over the course of the past few days (please note: it was not a good feeling, and I’d rather not go there again);
  4. My overarching assumption is that stocks will be MUCH lower at some point this year (prior to October) and, counter-trend rallies be damned, virtually all these puts will be worth much more later, even with time decay.
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Current Trade Follow-Up (by XerxesTraderGF)

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The past three trading days could not have worked out better. There was the perfect rejection of that resistance level of 4160 noted in my last post after being stuck in a very tight range and a great follow through once breaking down through support at 4080. The Friday close at the 3900 handle was equally enthralling. As most here noted, it is always good to be self-aware of your own excitement, because that is when things seem to turn. However, I’m going to lay out the remainder of my trade targets because it is just starting to get good.

I laid out my analog in the past showing the comparison between this market and previous bear markets. I actually added a few more into my analysis to try to be a bit more thorough (specifically 1968, 1981 and 2018). Each chart below notes 5 major inflection points.

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