IT top, decline to news lows possible.
Will be rebuilding SHORT POSITIONS with SPY and QQQ PUTS, prefer QQQ; also rebuilding new CRUDE short position - I prefer CRUDE OPTIONS but that is a treacherous and insane market where too much time is required...
Currently holding 10 SPY PUTS; on any rally I want to ramp up to above 60 puts or at least the 55 I held on the previous rally.
No QQQ position
FLAT Crude & ES
I am also looking at SMH -- a long position but at much lower levels, ditto for XLF and VOO
This is a good read:
"Well, talk about covering your butt. My sense fwiw: The Fed knows the collateral damage of their intervention actions has resulted in market valuations incompatible with the economic risk profile that keeps revealing itself. Valuations are too high and they know it. And hence they don’t want to be seen not having been on the record highlighting it, even if it is on a Friday evening after market close. So bulled up investors, take note. The captain just got the lifeboat ready for himself. Why are you still partying on the deck above?
Economic data released this week has continued to show disastrous declines exceeding expectations. The Atlanta Fed yesterday dropped its Q2 GDP expectations to -42.8%. Jobless claims again exceeded expectations. Industrial Production has collapsed in never before seen ways.
So yes, asset valuations, especially in tech remain sky high, and hence the China issue Guy raises is an important one, especially considering we are in a politically charged election year.
And just in the week following us raising all these valuation concerns we saw a rejection of the April highs this week. This rejection was no accident, it was technically well founded and we are discussing it in this week’s episode and the prospect of an intermediate market top and prospect of new lows still to come.
We are also covering the escalating tensions between the US and China, the challenges of reopening the economy, $AAPL, $GOOGL, $FB, the tech sector, the lagging broader market, some causes for optimism, but also concern about the dreadful impact this crisis is having on vast segments of the population, the health of the US consumer, and the reality of what the economy will look like in a post criss environment.
And frankly the reality that is emerging should concern everybody: