How To Trade Treasuries. A Few Thoughts.

A former trading partner used to say that bonds are the hardest and most complex instrument to trade. I have to say that bonds aren`t really my field of expertise but my core concept in trading bonds is, "if the economy is weakening, buy treasuries and if the economy is strengthening, short treasuries". I keep things simple with such a basic concept. But in my view it works a lot better than ultra complex trading methods.

Here`s a good excerpt from David Rosenberg on bond yields:

“There is a 90 percent correlation between the Fed funds rate and yields further out on the Treasury curve. So getting a handle on what is going on in Ben Bernanke’s brain is the key toward forecasting the bond market. This is where most economists and strategists get it wrong when they focus on backward looking indicators like the inflation rate, fiscal deficits or the US dollar, for that matter. The primary reason why bonds have rallied in the past three months is because the futures market has radically cut its expectation for any Fed tightening in the next six to nine months” - David Rosenberg, in The PragCap

Tickers: ProShares UltraShort 20+ Year Trea (ETF) (TBT) iShares Barclays 20+ Yr Treas.Bond (ETF) (TLT) iShares Lehman 7-10 Yr Treas. Bond (ETF) (IEF)

Securities More Often Reach Their Low Point When Some Danger Or Disaster Is Threatened, Than Upon The Actual Occurrence Of These Incidents

“Wall Street history shows that securities more often reach their low point when some danger or disaster is threatened, than upon the actual occurrence of these incidents, and the reason the low point is made just prior to, or at the time the event actually occurs, is: By that time every one who is subject to fear-of-what-will-happen, is sold out. When the thing does happen or is prevented, there is no more liquidation, and the price rallies on the short interest, or else on the investment demand created by the improved situation.” - Richard D. Wyckoff

Chicago PMI Comes Well Below Expectations

With the economy slowing faster and faster you have to ask yourself what is holding the market at a relatively high level...I think we are seeing the "turn of the month" effect.

I will be looking to short again soon. Very soon. I am out of longs and waiting for the right timing to SHORT!

Tickers: ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA), iPath S&P 500 VIX Short-Term Futures ETN (NYSE:VXX)

Pre-Market Is Green. No Surprises There.

I am not surprised to see a green pre-market today - the "turn of month" seasonality is in play. That`s why I only have a long trading idea (one stock pick) on the membership program.

I will be looking to close long trades and reverse to a short index position later in the week.

Today I will introduce you to "Sean Riley & The Slowriders"- great sound,


Tickers: ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA), iPath S&P 500 VIX Short-Term Futures ETN (NYSE:VXX)

The Most Powerful Force In The Universe.

Einstein once declared the most powerful force in the universe was compound interest. Interesting thought, isn`t it?

The Truly Exceptional Traders Can Stand Up To Anything

“Management of one's emotional state is critical. The truly exceptional traders can stand up to anything. Instead of getting emotional when things don't go their way, they remain calm and act in accordance with their approach.” - Charles Faulkner

Tricks Of The Trade I

Some recent blog posts that you may want to read in case you missed them. They are about trading or "how to trade" and are basically a compilation of trading thoughts from some of the best speculators of all time:

I Haven't Seen Much Correlation Between Good Trading And Intelligence


Paul Tudor Jones: How To Evaluate A Trader


Charting Is A Little Like Surfing


Timing Is Everything


Talented Traders Make Mistakes Regularly...Just Like Professional Athletes

You have plenty of material there for a quick read. I hope you enjoy it.

Have a great weekend!

If You Train Harder Than Your Opponents, You Will Win

“Every moment wasted is a moment the opponent trains. When you meet him, he will win.” - Grandmaster Cho

Just a thought to share with you. Trading is very similar to professional sports. You must train hard to succeed.

Here comes the weekend. Take the time to get your mind away from trading and go have some fun. I will take the time to play with my kid.

Have a great weekend!

How To Trade. A Thought.

Here`s an interesting thought on how to swing trade:

"Want the essence of swing trading in two sentences? Here goes:

In uptrending markets, buy weakness as it returns to strength. In downtrending markets, sell strength as it returns to weakness." - in MercenaryTrader

Yes, mean reversion is still a very powerful trading concept.

Have a great weekend!

Slight Bullish Bias For Today

While I am bearish for the medium term but I have a slight bullish bias for today. Friday`s before long weekends tend to have a bullish bias and the market is slightly oversold so I would not be surprised to see a rally today.

The only setup we currently have on the membership is on the long side of the market via a stock pick.

For the ferraristas, I will share Ferrari`s Theme Park. Can`t wait to go there. Maybe on my next vacation. Or perhaps I should let Enzo grow a little bigger and then go...

Related ETFs: ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA), iPath S&P 500 VIX Short-Term Futures ETN (NYSE:VXX)

Gundlach And Gross: Not Much Upside For US Treasuries

Are we near a major turning point for US Treasuries? Jeffrey Gundlach and Bill Gross seem to agree that we are...

"Jeffrey Gundlach, founder and chief executive of DoubleLine Capital LP, told Dow Jones Thursday that the market has little room to rally further, unless U.S. economic growth were to screech to a halt, while Pacific Investment Management Co. founder and co-chief investment officer Bill Gross told Bloomberg TV he doubted that 10-year Treasury yields would fall below 3% anytime soon." - in The WSJ

Related: ProShares UltraShort 20+ Year Trea (ETF) (NYSE:TBT), iShares Barclays 20+ Yr Treas.Bond (ETF) (NYSE:TLT), iShares Lehman 7-10 Yr Treas. Bond (ETF) (NYSE:IEF)

A Bullish View On The US Dollar

“The value of the dollar is close to a bottom. I’ve never been more optimistic on the long-term prospects of the U.S. dollar and U.S. economy.” - John Carlson, manager of the Fidelity New Markets Income Fund (FNMIX)

I have to say that this is a contrarian view these days...

This Week`s Best Quote Goes To...Gundlach

The best quote of the week goes to one of the finest investment managers in the world:

"Austerity means pain." - Jeffrey Gundlach, Double Capital

Plain and simple. Those who are asking for austerity in the US and call for a balanced budget should read this quote.

Very Soft Economic Data (GDP & Initial Claims)

I was not very impressed with the data that just came out. GDP came below expectations and Initial Claims also rose to 424,000. The slowing economy thesis is gaining momentum.

The line of least resistance will continue to be down, even if we have a few spikes, countertrend mini-rallies from time to time.

Related stocks and ETFs: ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA), Bank of America (BAC), Freeport McMoran (FCX), Broadcom (BRCM), Apple (AAPL), Akamai Tech (AKAM), Titanium Metals (TIE);

Bearish Bond Scenarios: Hyperinflation Or Booming Growth

“You can’t be super bearish about bonds unless you believe in one of two scenarios – hyperinflation or booming growth.“ - Cullen Roche, Pragmatic Capitalism

Related: ProShares UltraShort 20+ Year Trea (ETF) (NYSE:TBT), iShares Barclays 20+ Yr Treas.Bond (ETF) (NYSE:TLT), iShares Lehman 7-10 Yr Treas. Bond (ETF) (NYSE:IEF)

The End Of QE2 Will Be A Very Big Deal

"The end of QE2 will be a very big deal given the 89% correlation between the Fed’s balance sheet and the movements in the S&P 500 over the past two years." - David Rosenberg, Gluskin Sheff

Related stocks and ETFs: ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA), Bank of AMerica (BAC), Wells Fargo (WFC), Fifth Third Bancorp (FITB), Freeport McMoran (FCX), Broadcom (BRCM), Apple (AAPL), Akamai Tech (AKAM);

Gundlach: An Echo Of The Credit Crisis Coming?

"The housing market is dropping and about to go to a new low. I kind of think we're looking at some type of echo in the credit crisis coming up here. That's what I'm sort of afraid of."

- Jeffrey Gundlach, chief executive of the fixed-income investment management firm DoubleLine Capital

I always read Gundlach`s comments with interest as he is probably the best bond fund manager in the US.

Related stocks: Lennar (LEN), DR Horton (DHI), KB Home (KBH), Toll Brothers (TOL), Simon Property Group (SPG), Boston Properties (BXP), SL Green (SLG), Bank Of America (BAC), Citigroup (C), Wells Fargo (WFC), JP Morgan (JPM), Goldman Sachs (GS), Morgan Stanley (MS), Fifth Third Bancorp (FITB)

I Haven't Seen Much Correlation Between Good Trading And Intelligence

“I haven't seen much correlation between good trading and intelligence. Some outstanding traders are quite intelligent, but a few aren't. Many outstandingly intelligent people are horrible traders. Average intelligence is enough. Beyond that, emotional makeup is more important.” - William Eckhardt, hedge fund manager

Sector Performance Year To Date

Interestingly enough, Materials are the worst performance year to date (where are the inflation fears??) and Financials have also been underperforming. The best to be so far in 2011 has been Healthcare and Consumer Staples.

Related: Energy Select Sector SPDR (ETF) (NYSE:XLE), Utilities SPDR (ETF) (NYSE:XLU), Financial Select Sector SPDR (ETF) (NYSE:XLF), Materials SPDR (ETF) (NYSE:XLB)

Paul Tudor Jones: How To Evaluate A Trader

“You've got to look at good traders historically. If a trader can on average annually deliver two to three times their worst drawdown, then that's a very good track record, and I'd say that that's what I try to do.” - Paul Tudor Jones, hedge fund manager

Bill Gross: A Soft Default For Greece

"We wouldn't go so far as to suggest that Greece or any other country leave the euro. What I think needs to be done....is for private debtholders and Euroland banks...to take a debt extension or some kind of soft default that alleviates the burden for these countries." - Bill Gross, PIMCO

Related: National Bank Of Greece (NBG)

Basic Materials Sector Is Negative in 2011

If inflation is on everyone's brain, then why is the S&P 500 basic materials sector the only other one down for the year? - David Rosenberg, Gluskin Sheff

Related Stocks: E.I. du Pont de Nemours & Company (NYSE:DD) Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX) The Dow Chemical Company (NYSE:DOW) Monsanto Company (Public, NYSE:MON) Newmont Mining Corporation (Public, NYSE:NEM) Praxair, Inc. (NYSE:PX) Air Products & Chemicals, Inc. (NYSE:APD) Alcoa Inc. (NYSE:AA)

Interesting View On The Inflation/ Deflation Debate

"Of course, deflation is now going to rear its head again. Oil prices are down 13% from the nearby peak. The base metals complex is down 10% from the recent high as well and trading both below the 50 and 200 day moving averages. The agriculture price sphere has corrected 10%. Gold is off the boil and silver has plunged 35%. Deflation is the principal threat, not inflation.” - David Rosenberg, In the Prag Cap

50 Percent Of NYSE Stocks Are Trading BELOW Its 50-Day Moving Average

"Over half of the NYSE is now trading below its 50-day moving average" - David Rosenberg, Gluskin Sheff

Related stocks and ETFs: ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA), Bank of AMerica (BAC), Wells Fargo (WFC), Fifth Third Bancorp (FITB), Freeport McMoran (FCX), Broadcom (BRCM), Apple (AAPL), Akamai Tech (AKAM);

Rosenberg On The S&P 500 Index.

"The S&P 500 is no higher now than it was on February 7. Yet, so many pundits still believe we are in a flaming bull market." - David Rosenberg, Gluskin Sheff

Related stocks and ETFs: ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA), Bank of AMerica (BAC), General Electric (GE), NetFlix (NFLX), Ford (F), Lennar (LEN), Micron Tech (MU)

Nymex Oil Still Pretty Volatile

We have been in rally mode on Nymex Oil Futures but the rally is losing momentum. CL Futures are almost 1.50 dollars below the intraday high.

The range is still pretty large, we have a 348 ticks daily range so far. 100 USD is now the new short term resistance and pivot point.

Related: United States Oil Fund (USO), Exxon Mobil (XOM), Chevron (CVX), Marathon Oil (MRO), ConocoPhillips (COP), Murphy Oil (MUR), SandRidge Energy (SD), Transocean (RIG), ProShares UltraShort DJ-UBS Crude Oi ETF (SCO)

Goldman Sachs: Bullish On Commodities (Again)

Goldman Sachs suggested buying oil, copper and zinc, reversing last month’s call to sell commodities, while Morgan Stanley raised its forecast for Brent crude by 20 percent...

“The risk/reward once again favors being long commodities,” Jeffrey Currie, head of commodities research at Goldman Sachs in London, wrote in an e-mailed report today. “Economic growth will likely be sufficient to tighten key supply-constrained markets in the second half, leading to higher prices.” - in Bloomberg

Related: Freeport McMoran (FCX), United States Oil Fund (USO), Exxon Mobil (XOM), Chevron (CVX), Transocean (RIG), Marathon Oil (MRO), ConocoPhillips (COP), Murphy Oil (MUR), BP Plc (BP)

SandRidge Energy (SD) Trading At Major Support

An interesting chart. SandRidge Energy (SD) is trading around major support levels:

Goldman Sachs: Raising Crude Oil Forecasts

"We expect that the ongoing loss of Libyan crude oil production and disappointing non-OPEC production will continue to tighten the oil market. It's only a matter of time until inventories and OPEC spare capacity will become effectively exhausted, requiring higher oil prices to restrain demand." - in a Goldman Sachs report

Goldman raised its crude forecasts, it expects Brent will rise to 140 dollars per barrel by the end of next year, higher than the investment bank's previous forecast of 120 dollars per barrel.

Related: United States Oil Fund (USO), Exxon Mobil (XOM), Chevron (CVX), Marathon Oil (MRO), ConocoPhillips (COP), Murphy Oil (MUR), SandRidge Energy (SD), Transocean (RIG)

Oil Futures Are Still Strongly Linked To US Dollar Moves On A Daily Basis.

NYMEX Light crude (JUL) settled down 2.40 dollars per barrel at 97.70 USD. The US Dollar is still dictating daily moves in the commodity complex and in crude oil in particular. Nymex Oil futures futures are in a trading range between 95 USD and 105 USD a barrel since May 5.

I am expecting a few more wild sessions with multi dollar daily ranges. We had a 367 ticks intraday range today on the electronic session.

Related: United States Oil Fund (USO), Murphy Oil (MUR), Exxon Mobil (XOM), Sandridge Energy (SD), Chevron (CVX), ConocoPhillips (COP), Marathon Oil (MRO)

Money Supply, FED & a Good Joke

Do you want to read a good joke?

"So, I heard the Fed increased the money supply, but I checked my bank balance and it's the same as before." - Dilbert

Have a great day!

Pre Market Is Red. Just Completed A Successful Swing Short.

It`s a great feeling to wake up and watch futures down 14 points on Globex. I was able to close my swing short on the target. What a way to start the trading week...

S&P is threatening a downgrade in Italy and that is one of the reasons why markets are red this morning. But this weakness was already quite visible from last week`s price action. In other words, the speculative line of least resistance was down.

I will take my time now to see how markets react and decide what the next big, structural trade will be.

I will leave you with an interesting quote, “The loss of the money didn't bother me. Whenever I have lost money in the stock market I have always considered that I have learned something; that if I have lost money I have gained experience, so that the money really went for a tuition fee. A man has to have experience and he has to pay for it.” - in Reminiscences of a Stock Operator

Related ETFs: ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA)

Charting Is A Little Like Surfing.

A good technical analysis analogy by a great trader,

“Charting is a little like surfing. You don't have to know a lot about the physics of the tides, resonance, and fluid dynamics in order to catch a good wave. You just have to be able to sense when it's happening and then have the drive to act at the right time.” - Ed Seykota

Have a great weekend!

Related stocks & ETFs: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA), LDK SOlar (LDK), Apple (AAPL), Netflix (NFLX), Nike (NKE), Ford (F)

Buy The Dip Did Not Work On Friday`s Session...

When I read this tweet from Cullen Roche (The Pragmatic Capitalism), "Buy the dip - Has one strategy ever worked for so long with such precision?" I thought to myself, the market will sell off and close near the lows. It was the contrarian in me speaking and because I am a regular reader of his website I am familiar with his thinkings. Anyway that reminds me a great Gary Bielfeldt`s quote:

“Whenever too many people are doing the same thing, the market will go through a period of adjustment.” - Gary Bielfeldt

Have a great weekend!

Related stocks & ETFs: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA), General Electric (GE), Apple (AAPL), Caterpillar (CAT), Nike (NKE), Ford (F)

Speculation Must Be An Unnatural Sort Of Business

“I sometimes think that speculation must be an unnatural sort of business, because I find that the average speculator has arrayed against him his own nature.” - Jesse Livermore, in Reminiscences of a Stock Operator

Related stocks & ETFs: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

The End Of The World.

What to read a good joke?

"If you can't think of a rapture joke, don't worry. It's not the end of the world." - in Twitter

Timing Is Everything.

"If a trader is right on direction, but wrong on timing, then the trader is wrong period." - Peter Brandt, Futures Trader, author of Diary of a Professional Commodity Trader

LinkedIn (LNKD): What A Start!

Here`s the intraday chart of LinkedIn (LNKD) debut (remember that the IPO was priced at 45 USD):

Goldman Sachs: Philly Fed Weakened Sharply

"The Philadelphia Fed’s monthly manufacturing survey weakened sharply for the second month in a row. The headline index of “general business activity” fell to 3.9, from 18.5 in April and 43.4 in March. This still suggests factory sector growth, but only barely. Most of the detailed activity indexes also weakened – the new orders index fell to 5.4 from 18.8, the shipments index to 6.5 from 29.1, and the unfilled orders index to -7.8 from 12.9 – with the exception of employment, which rose to 22.1 from 12.3 in April. (We have no information on how much of the drop in the Philly survey over the past two months could have been related to supply chain issues associated with the Japanese earthquake, but this is not a region with an especially high concentration of vehicle manufacturing.) Price pressures eased a little but remain high in historical terms." - Source: Goldman Sachs

A Pure Risk Taker...

“There is nothing like danger to focus the mind, and I do need the excitement connected with taking risks in order to think clearly. It is an essential part of my thinking ability. Risk taking is, to me, an essential ingredient in thinking clearly.”

- George Soros

Is This A Stock Picker`s Market Now?

Interesting thoughts from Derek Hernquist,

"After a long break from pairs trades, I’ve begun creating trades to exploit the stocks I like against the stocks I don’t. I’ve become accustomed to a highly correlated market that prefers macro thinking to micro, but this change in tone to a more rotational, more divergent market seems for real this time." - Derek Hernquist

I have also noticed the rotational, divergent market over the last few sessions. Indexes don`t really go anywhere but there are decent moves within the market sectors/ groups and stocks. Its getting more and more a stock pickers market. I think that is good. Its easier for the best pickers to shine and not have to worry about the big "Risk ON/ Risk OFF" swings that have been dictating market for years now.

While I am bearish and expecting a correction, I have to say that Derek has a good point there.

Related: Dell (DELL), Hewlett Packard (HPQ), Cisco Systems (CSCO), NetFlix (NFLX), Ford (F)

Bearish Winds Blowing On Wall Street.

I think we are just starting a pretty decent market correction...

Check LinkedIn (LNKD). Trading up 94 percent on the debut. What a pity that there are no shares available to short.

Related stocks & ETFs: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Philly Fed And Leading Indicators Signaling A Fast Deteriorating Economy...

The economic data that just came out is very bearish. Leading Indicators are now negative (yes, NEGATIVE) and Philly Fed also came well below expectations.

I am bearish and short and I think there will only be one side to this market going into the summer. The SHORT side.

Have a great day and remember "Short in May and sail away"!

Related stocks & ETFs: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA), General Electric (GE), Apple (AAPL), Caterpillar (CAT), Nike (NKE), Ford (F)

Richard Bernstein: China & Gold - Bubbles Forming

“China has a credit bubble that makes ours look like nothing. Everything people don’t like about the United States over the past five years they have in spades.

Gold is not in a bubble but it is about as close as you can get.”

Richard Bernstein, CEO of Richard Bernstein Advisors

Related Etfs: SPDR Gold ETF (GLD), Newmont Mining (NEM), Barrick Gold (ABX), Novagold (NG), Goldcorp (GG), iShares FTSE/Xinhua China 25 Index (ETF) (Public, NYSE:FXI)

ECRI: It`s Clear That We Will Have A Peak In Global Industrial Growth This Summer

"It is not country specific, but imagine if you could add up all the activity in factories around the world and see if it was accelerating or decelerating, that is what this indicator is focused on. And it has been telling us very clearly, unambiguously, that we have a peak in global industrial growth this summer." - ECRI

Its clear that ECRI is also expecting a global growth slowdown this summer. In market terms that may be translated into a rally going to the end of the month of May followed by a weak period during the summer months. The classic "Sell in May and go away" will be rebranded as "Sell short in May and sail away".

The end of QE2, the debt ceiling debate and weak seasonal and growth trends will probably be a bit too much for the markets to digest. Anyway, the markets have been rallying for 2 years and 2 months so its certainly time for a pause/ correction.

Have a great day!

Related stocks & ETFs: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA), General Electric (GE), Apple (AAPL), Caterpillar (CAT), Nike (NKE), Ford (F)

ECRI Says Inflation Has Peaked.

“Commodity price inflation is rolling over. This is a classic sequence, and people need to start thinking about the scenario where global industrial growth once again starts to throttle back.” - Lakshman Achuthan, ECRI

Related: IShares Silver ETF (ETF), SPDR Gold ETF (GLD), United States Oil Fund (USO), Freeport McMoran (FCX), Newmont Mining (NEM), United States Steel (X)

Talented Traders Make Mistakes Regularly...Just Like Professional Athletes.

Every talented trader makes mistakes regularly. There`s nothing strange about that. It`s just like a talented professional soccer player that misses a chance just in front of goal...like Miroslav Klose:

Retail Investors Are Bearish.

According to recent Bespoke`s poll, retail investors are bearish. About two thirds of the voters are expecting the Dow Jones to hit 12,000 before hitting 13,000.

While I am neutral on the stock market at this level, this stat makes be a bit more bullish.

Have a great day!

Related stocks & ETFs: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA), Bank of America (BAC); Goldman Sachs (GS), Micron Tech (MU), Applied Materials (AMAT), Netflix (NFLX)

"Euro/US Dollar" Moves Will Keep Dictating Oil`s Price Action

"The main driver for oil will remain the euro-dollar link." - Ken Hasegawa, Newedge Japan commodity derivative sales manager

Yes, I agree with this view. The US dollar is still "The King". When it moves one way or the other, the "risk trade" moves too.

After an overnight globex rally, futures are now flat. There are no major economic news coming out today, so we will probably have a range bound trading session.

Have a great day!

Related: United States Oil Fund (USO)

Warren Buffett: The US Is Not Going To Have A Debt Crisis.

“The United States is not going to have a debt crisis as long as we keep issuing our debts in our own currency. The only thing we have to worry about is the printing press and inflation.” - Warren Buffett

Recession Or No Recession. Who Cares?

Goldman Sachs` chief economist said earlier today that a US recession is years away. Who cares?

The real question is not if we have a recession or not. In speculative terms the only thing that matters is if we are slowing down or growing faster. Asset prices only care about the second derivative.

Jesse Livermore was probably the first guy to grasp this concept more than 100 years ago. He mentioned improving and deteriorating business conditions in his precious Reminiscences Of A Stock Operator.

Related: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA), Bank of America (BAC); Goldman Sachs (GS), General Electric (GE), Ford (F), Caterpillar (CAT), United States Oil Fund (USO)

Interesting Zig-Zag Day In Nymex Oil. Are We Finding Support?

I am watching Nymex Oil Futures closely. Is today`s Zig-Zag activity a bottoming sign?

We will find the answer soon enough. No questions are left unattended in trading...CL is trading at 95.80 USD right now.

Why Is Trading Less And Less Popular?

I checked the search volume for the word "trading" on Google Trends and this is what came out:

Trading is becoming less and less popular. I ask why, and open the discussion on the comments section below.

Have a great day!

Making Fun Of America`s Debt - Video

Now, this is quite a shocker...An asian video making fun of America`s debt.

Let`s see who has the last laugh...

DIsmal Economic Data. Again.

The Industrial Production data came in well below expectations.

It will be interesting to see what the market does in response to another negative data point. I have no position in the indexes right now. I am waiting for the market to show us the way...

If you feel the need to take a 5 minutes break from trading, listen to this fantastic sound (Festival, Sigur Ros). You will feel refreshed and ready to go again. Put the headphones on and play it loud.

Related: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

Gold Bearish Seasonality.

We are entering a period of bearish seasonal trends for gold as we can see in the chart below:

The bearish seasonal trends are in play till mid-September.

It`s also interesting that George Soros cashed in on his bullish gold bet in the first 3 months of the year. In Soros` words, "Volatility is greatest at turning points, diminishing as a new trend becomes established." Was this recent spike in volatility a warning sign?

After rallying for 10 straight years it is surely time for a pause/ correction.

Related: SPDR Gold EFT (GLD), Novagold (NG), Newmont Mining (NEM), Barrick Gold (ABX), Goldcorp (GG);

Empire State Survey: Conditions Improved But At A Slower Pace

“The Empire State Manufacturing Survey indicates that conditions for New York manufacturers improved in May, but at a slower pace than in April. The general business conditions index fell ten points to 11.9. The new orders index declined fi ve points to 17.2, and the shipments index slipped three points to 25.8. The inventories index climbed to 10.8, its highest level in a year. The prices paid index rose to 69.9, its highest level since mid-2008, while the prices received index held fi rm at 28.0. Future indexes continued to convey a high level of optimism about the six-month outlook, although prices are widely expected to rise.” - in NY Fed

Related: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

Bill Gross Sets The Record Straight.

Bill Gross, Pimco Co-CIO & founder, explains there is a misconception that Pimco is short US Treasuries. Investors can find pristine balance sheets in countries like Canada, Brazil or Germany.

Raw Materials: Getting Ready For Act 2?

Here`s an interesting market comment by Peter Brandt:

"In the markets, as in real life, flags flying at half mast symbolize death. A number of half-mast flags and pennants in the raw material markets indicate that the steep decline in early May was just Act 1 in a two-act play." - in stock twits

Related: United States Oil Fund ETF (USO), Alcoa (AA), Freeport McMoran (FCX), United States Steel (X), Hecla Mining (HL), Ishares Silver ETF (SLV)

I Have No Bias Right Now. Waiting For An Opportunity.

Pre-market is red again but futures are coming back from the Globex lows. I am in the comfortable position of having no trades on. I can always read the market better when I am out of speculative positions.

My last bear raid was a decent one and I am now looking for new trading opportunities.

In terms of data, it will be a relatively light session with the Empire State Survey coming out at 8.30 AM ET and with the Housing Data Index coming out later at 10.00 AM ET.

Right now I have a neutral bias on the S&P 500 Index. I will be looking for clues to get onboard the next real move.

In the meantime I will leave with with a fantastic video. The Suburbs (Arcade Fire):

I hope it will give you the proper rhythm to the trading session.

We Have Plenty Of Downside. Gravity Finally Kicking In.

Related: Related ETF`s: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Interesting Sell Off Going On. Still Short.

Red ships are sailing nicely now. Good across the board sell-off in the last minutes.

Nymex Oil bulls are also feeling the heat. Futures are down 3%.

We are about to see 99 USD oil again very, very soon.

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Mixed Session So Far.

We have a mixed market so far today. Energy and metals selling off and tech stocks rallying on Intel`s (INTC) dividend increase.

I am still bearish and short the indexes but I also seeing some interesting picks on the long side like Broadcom (BRCM). John Deere (DE) also came to my attention today being weak after a decent rally.

Treasuries are quiet but the line of least resistance is probably up for today. Interesting session so far...

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Big Cap Oil Stocks: Best & Worst YTD

Marathon Oil (MRO) is the best YTD performer in the big cap oil stocks complex. In contrast Murphy Oil (MUR) is the laggard. Check both charts plus a ratio of the two stock prices:


And the ratio between Marathon Oil (MRO) and Murphy Oil (MUR):

In case you missed my earlier post on Seinfeld`s new website, check it now: Trading With A Smile On. Thanks, Jerry.

Sherlock Holmes & Trading

“It is a capital mistake to theorize before one has data.”- Sir Arthur Conan Doyle

The same holds true in trading. A very good trading lesson from Sherlock Holmes.

It Is Never Comfortable To Be Wrong

“As far as my trading went, having a million merely meant more reserves. Money does not give a trader more comfort, because, rich or poor, he can make mistakes and it is never comfortable to be wrong. And when a millionaire is right his money is merely one of his several servants.” - Jesse Livermore, in Reminiscences of a Stock Operator

A must read book for all that are serious about trading and speculating.

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Trading With A Smile On. Thanks, Jerry.

I am a big, big Jerry Seinfeld`s fan. You probably already know that if you have been around long enough.

Now Jerry is running his website www.jerryseinfeld.com where he uploads 3 videos of his work per day (old and new material). This is awesome. Trading days will be funnier from here on as I do not plan to miss any of his material...

Thanks, Jerry.

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

What`s Next For Bank Of America (BAC)?

Despite the recent mini rally on the indexes (up 2 days in a row and up in pre-market again), Bank Of America (BAC) is beginning to break lower. I am pretty sure that if the indexes reverse and trade lower, Bank of America (BAC) will lead...on the downside.

Bank Of America (BAC) is on my radar screens. May setup a very decent trade soon...

I haven`t posted a Ferrari in a while, so here it goes (another true masterpiece):

Broadcom (BRCM): A Rebound Play Candidate?

Will Broadcom (BRCM) find support and rally from here? The stock is stabilizing and finding support just below 34.00 USD. I will be watching it as a rebound play candidate.

China Oil Imports Show Modest Rise YoY.

"Chinese oil imports rose at a modest 1.8% annual rate in April - are high prices starting to curb the country's demand for oil?" - in Platts.com

Related: United States Oil Fund (USO), iPath S&P GSCI Crude Oil Total Return (OIL), Exxon Mobil (XOM), Murphy Oil (MUR), Marathon Oil (MRO), ConocoPhillips (COP)

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Margin Compression. A Bearish Factor For Stocks.

"With earnings season largely finished we are beginning to generate some solid conclusions. One persistent trend this earnings season has been margin compression across many companies as costs surge." - in The Prag Cap

Related ETF`s: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

Renren (RENN): The Chinese Facebook Has Traded Down, Down, Down & Down.

This stocks only knows down sessions and dark candles.

Time for a little rebound?...I am not getting involved in this stock. Just watching the action.

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Major Oil Rebound. Up 6%.

Nymex Oil futures are rebounding 6 percent, trading at 102.80 dollars per barrel.

Commodity markets are really putting risk managers to the test. I wonder how many traders got killed one way and the other...

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

A New Week. Some Old Habits.

Well, we have a new trading week upon us but it seems that the crazy volatility in commodities will keep on going today. Silver futures are up 5.90 percent and Nymex oil Futures are rebounding 2.75 percent to 99.85 USD per barrel. Today`s globex range on Nymex Oil is already quite large, 2.90 dollars per barrel.

I don`t like to trade when markets are that wild. I used to, but it seems that I am growing older and more conservative. Maybe its the responsibility of being a father. :)

I will post again later if I detect a few markets opportunities. Stay tuned.

Although I am not a jazz lover, I love this live performance from Herbie Hancock.

Related ETFs: United States Oil Fund (USO), IShares Silver ETF (SLV)

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Weekends & Leisure Time

It`s Sunday so I am taking the time to play with my kid. Weekends are very important to short-term high velocity traders because those 48 hours of distraction away from the trading desk are vital to one`s emotional balance. When I am vacationing or over weekends I never think about the market. It`s the time I have to be with friends and family and I really appreciate being physically and emotionally away from Wall Street.

I will leave you with a good quote, "Life shrinks or expands in proportion to one`s courage" - Anais Nin. If you want to have a full filling life you must take some risks.

Have a great day!

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Robert Doll: Commodities Can Have Vicious Swings In Either Direction Without Much Rhyme Or Reason

"It's not only that commodity prices are correcting. The dollar is correcting by going up. Movement in the other direction, in my mind, is way overdue. It doesn't mean commodities made a peak and will keep coming down. The commodities are among the most volatile things out there and they can have vicious swings in either direction without much rhyme or reason.” - Robert Doll, BlackRock

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Whales, Turtles & Traders

"Whales only get harpooned when they come to the surface, and turtles can only move forward when they stick their head out, but investors face risk no matter what they do." - Charles Jaffe

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Oil Futures: Biggest Weekly Dollar Loss Since Oil Began Trading On The Nymex In 1983

"Oil prices plunged, finishing the week at $97.18 per barrel, down $16.76, in the biggest weekly dollar loss since oil began trading on the Nymex in 1983." - in CNBC

Related: United States Oil Fund (USO)

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Goldman Sachs: Economy Growing At 2.3% Pace In April

"After the Employment Report, our Current Activity Indicator (CAI) showed growth of 2.3% in April, down from 4.0% in March. The deceleration mostly reflects weaker survey-based data (e.g. the non-manufacturing ISM and Philly reports), and indicates a cooling in overall growth early in Q2." - Goldman Sachs, via ZeroHedge

I am still bearish on stocks. The "Sell in May and go away" will be adjusted to "Short in May and sail away."

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Goldman Sachs Oil Outlook: Still Long Term Bullish

Here`s an excerpt of the latest Goldman Sachs`oil outlook:

"It is nevertheless important to reiterate that while we saw recent prices as having risen above the levels consistent with underlying near-term supply-demand fundamentals, we continue to believe that the oil supply-demand fundamentals will tighten further over the course of this year, and likely reach critically tight levels by early next year should Libyan oil supplies remain off the market. Consequently, it is important to emphasize that even as oil prices are pulling back from their recent highs, we expect them to return to or surpass the recent highs by next year. " - David Greely, Goldman Sachs via ZeroHedge

From what I understand they expect some near term weakness (not sure if yesterday`s and today`s drop is already factored in the report) but they remain bullish long term. Nothing really new there...

Related: United States Oil Fund (USO), Exxon Mobil (XOM), ConocoPhillips (COP), Murphy Oil (MUR), Marathon Oil (MRO), Chevron (CVX)

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Jobs, Jobs, Jobs.

Today`s employment report will set the tone for early the action. We saw a big volatility spike in markets this week, especially in the commodities complex. Volatility is normally bearish for asset prices but equities have been way less volatile than currencies and commodities.

Let`s see how the non-farm payrolls number comes out and how the market reacts to it. It will be an interesting session once again. Fasten your seat belts!

By the way, the consensus number is +185,000.

Related ETF`s: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Today`s Final Move Will Be Down

Equity markets are relatively strong vis-a-vis the commodity market. Oil and Silver are crashing lower and Gold is also taking quite a beating. That trade was crowded with retail investors (especially silver) and now we are seeing extreme moves as these traders get killed.

I am expecting a downside move in equities on the final 2 hours of today`s trading session. ES Futures are trading at 1339.50 and NQ Futures just printed 2389.00.

I am going for an Italian red wine today. A high-end one if ES Futures close lower than they are now...

Have a great day!

Related: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Some Tech Names Are Acting Strong

Some tech names are acting strong today: NetFlix (NFLX) up 1%, Juniper (JNPR) up 2.2% are two good examples...

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Oil Gaining Downside Momentum. Will It Test 100 USD Today?

Big, big downside volatility in Nymex Oil Futures today. CL is down 7% and its fast approaching 100 USD per barrel.

Red Ship Sailing.

Many stocks making new lows now. Weakest stocks on my list are Murphy Oil (MUR), Fifth Third (FITB) and Hecla Mining (HL).

On the bullish side, Delta Airlines (DAL) and American Airlines (AMR) are rallying to new intraday highs. I am still short eMini S&P Futures and I am loving the action so far...

Oil Down 5 Percent.

Oil is trading down 5%. Silver is crashing down. The inflation trade is wounded or maybe its dead...

Related: United States Oil fund (USO), IShares Silver (SLV), SPDR Gold ETF (GLD)

Pre-Market Is Lower. I Am Short.

Lets`s go back to last summer. Late August. Do you remember what ignited the big rally in stocks? It was a stronger than expected ISM data followed by the promises of more QE.

Now we have the mirror image of that. A bad ISM report, much worse than expectations and the likely end of QE in less than 60 days. That is a hell of a bearish cocktail...

Related: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

How Bad Was The ISM Data?

This morning’s ISM Services report missed estimates substantially. Headline came in at 52.8 vs expectations of 57. The underlying data was even worse. New orders tanked 11.4 points to 52.7. Unemployment fell to 51.9 from 53.7. Meanwhile, prices, though falling, remain at very high levels. - in The Prag Cap

Is Mexico The New Version Of A Dentist?

"Mexico increases its gold reserves nearly 17-fold, buying more than 90 tons of the metal between January and March. The purchases are the equivalent of 3.5% of annual mine output and move the country to 33rd on the list of largest holders of gold"

Many years ago, dentists were the last market participants to notice a market move and act on it. They bought the top and sold the low. Is Mexico the new version of a dentist in the gold market?

Related: SPDR Gold ETF (GLD), Newmont Mining (NEM), Goldcorp (GG), Barrick Gold (ABX), Novagold (NG), Freeport McMoran (FCX)

South Korea Throwing The Towel On The US Dollar...

South Korea is now afraid of the US Dollar...a contrarian indicator?

"Seeking to further diversify from the greenback, South Korea considers investing a portion of its more than $300B in foreign currency reserves (7th largest on the planet) in yuan-denominated securities. U.S. securities currently make up about 64% of SK's stash" - in seeking alpha

SIlver Crashing Down. No Surprises There.

Its probably a good time to read Cullen Roche`s (and mine) silver call a few days ago:

Silver, Silver, Silver

That move could not hold. No surprises there...

Related stocks and ETFs: Hecla Mining (HL), Siler Wheaton (SLW) and IShares Silver ETF (SLV)

Are We Entering A New Bear Phase?

Do you remember back in August when the market rally began on a stronger than expected ISM data just when the market participants were talking about a double dip in the economy and the S&P was trading at 1000-1100?

Is today`s worse than expected ISM Services as significant? Are we entering a bear phase? I think we are. Perhaps the old adage, "sell in May and go away" as never been more true. I will change it to, "short in May and sail away!".

Related: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY), iShares Russell 2000 Index (ETF) (NYSE:IWM), ProShares UltraShort QQQ (ETF) (NYSE:QID), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

The Dollar Is Now Weaker Than It Has Ever Been

"With the Fed's latest data release, it's official: in inflation-adjusted and trade-weighted terms (arguably the best way to measure the dollar's true purchasing power overseas), the dollar is now weaker than it has ever been." - Scott Granis, in Calafia Beach Pundit

Bought A Trading Book. First In A Few Years.

I bought Peter Brandt`s book at Barnes & Noble. The last trading book I bought was a few years ago, as I basically don`t have much time to read and most of the trading books on sale don`t even give you a single new trading idea. I am curious to read this one, but while Peter is a medium to long term trader and I am a frenetic short term trader/ day trader. Here`s a quote from this veteran trader:

"Over the years my trading horizon has gotten longer while the horizon for most traders has gotten shorter. Apparently I am out of step with the world." - Peter Brandt

What Is A Trading Position?

A position is not an opinion and an opinion is not a position. A position, purely and simply, is a specific market set-up that provides certain risk/reward characteristics. - Peter Brandt, commmodity futures trader

Back To The Trading Desk. Seasonality.

I am back to the trading desk after a one week break. I was a bit surprised with the big S&P rally but not that much surprised with the correction in Silver. It had to happen and it did. I am taking the market`s pulse and getting ready to begin trading again.

We are now entering a bearish seasonal period for equities. Check this stat:

"A 10,000 USD investment compounded to 527,388 USD for November to April in 60 years compared to a 474 USD loss for May to October" - in the Prag Cap

Related: ProShares UltraShort S&P500 (ETF) (NYSE:SDS) , SPDR S&P 500 ETF (NYSE:SPY)