Author Archives: thedangerpoint

Nat-Gas … New Lows

November 22, 2023 By in $SPSIBI, Biotech, LABD, LABD-23-13, Natural Gas, Positions, SPBIO, UNG, XBI 1 Comment

The Longs, Getting Crushed … For Now

The premise for a Nat-Gas (long) trade has not gone away.

The fact this market (UNG) is beating the longs senseless, is a potential indicator in itself.

Evidence continues to mount, uninterrupted access to anything is a luxury; one is prudent to consider the potential effects of supply disruption.

For Nat-Gas UNG, there’s more to the story; it’s following a Fibonacci projection as we’ll see below.

Nat-Gas UNG Daily, Fibonacci Projection

If the projection holds, next lower level is UNG 5.55 area.

As far as where Nat-Gas goes from here, anything can happen; it could even go negative just like the crude futures did back in April of 2020.

Positioning

Nat-Gas: There are no positions in UNG at this point (not advice, not a recommendation).

However, if UNG does decline to the 5.55 area, just the ‘value’ itself will be enticing.

Biotech: While the 3X Leveraged Inverse Fund LABD, posted a new daily low (just after the open), SPBIO, $SPSIBI, indices and the XBI, ETF have not yet posted new daily highs (which would have negated the short trade).

This in a nutshell, is what makes shorting the market with a highly leveraged inverse fund (and doing it effectively) a challenge at times.

The short position LABD-23-13, has been maintained with a new Hard Stop @ LABD 18.40 (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Turnaround Tuesday?

November 21, 2023 By in $SPSIBI, Biotech, Gold & Silver, IYR, LABD, LABD-23-13, Positions, Real Estate, SLV, SPBIO, SRS-23-04, XBI, zsl, ZSL-23-01 1 Comment

Possible Reversal During The Holiday Week

While no-one’s looking, markets tend to reverse.

Typically, that happens before, during, or just after a holiday week.

Perhaps, the most famous of these was the day after Labor Day Weekend, September 3rd, 1929, the all-time high up to that point.

Adding substance to the assertion, the all-time high (thus far) for the S&P 500, was January 4th, 2022, with the closing high the day before.

So, here we are in the midst of the Thanksgiving holiday week. Is the market going to reverse?

Biotech SPBIO, $SPSIBI, XBI, Daily

The November 3rd, update showed the target area for biotech ($SPSIBI).

Price action decisively penetrated that area yesterday and then immediately started to retrace.

As of this post (10:12 a.m., EST), price action has printed a new daily low.

Positioning

As stated in this update, the coming week was likely to see adjustments to open short positions.

The Real Estate (SRS-23-04) and Silver (ZSL-23-01) shorts have been closed, with the biotech (LABD-23-13) position increased (not advice, not a recommendation.

The Hard Stop for LABD-23-13, is LABD 17.62 but will likely be moved to the session low, currently LABD 18.79 (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Going Short on ‘Corrective Waves’

November 18, 2023 By in $SPSIBI, Biotech, Gold & Silver, IYR, LABD, LABD-23-13, Positions, SLV, SPBIO, SRS, SRS-23-04, XBI, ZeroHedge, zsl, ZSL-23-01 2 Comments

All The Same ‘Look’

Did we just have the largest bull trap in market history?

Now, after the bulls (may) have been caught off-guard, we have this; the specter of ‘deflation‘ and demand destruction.

Last Tuesday’s CPI report provided a backdrop for the continued squeeze higher.

Over the past several weeks, at least three markets have developed the same (bearish) ‘look’.

They’re posting corrective ‘a-b-c’ price action, going against the main trend.

SLV, IYR & XBI, Weekly

Take a look, all similar in their formation.

Positioning

As of the close on Friday, I have positioned short in all three markets (not advice, not a recommendation).

The IYR short was initiated this past Wednesday, the Silver short on Thursday, then just minutes before the close on Friday, the biotech short.

Trades are labeled as SRS-23-04, ZSL-23-01, LABD-23-13

Next Steps

The coming week is likely to see one, or a variation of the following: all trades stopped out, one or two trades with discretionary exit, then followed by potential concentration on the best candidate.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Silver Upside Breakout

November 16, 2023 By in Gold & Silver, Positions, SLV, UNG, UNG-23-05, zsl, ZSL-23-01 1 Comment

Above Resistance, In (Potential) Trouble

So, Tuesday, the shorts were carried out on stretchers.

No matter the sharp upward spike, short covering has not changed the tsunami; the ‘liquidity crisis‘.

Basically, there’s not enough cash to go around, not enough in a big way.

Is it possible, in the coming year, there will be huge demand for cash … fiat cash?

With that backdrop we have silver (SLV) making lower highs and lower lows.

Silver SLV, Daily

The chart shows a breakout above resistance. The question is, can it hold?

With price action where it is, just above resistance, SLV is at The Danger Point®

If it can’t push materially higher from here, it’s at risk of reversal.

Positioning

Silver:

With the above conditions and potential for downside, a short position was opened via Leveraged Inverse Fund ZSL

Entry at ZSL 18.18 (not advice, not a recommendation).

Hard Stop is TBD but will likely be the session low @ ZSL 18.04.

Trade is, ZSL-23-01

Natural Gas:

Trade UNG-23-05, was stopped out this session at UNG 6.44 for a minor profit of 0.10-pts.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Nat-Gas & Real Estate

November 14, 2023 By in IYR, Natural Gas, Positions, Real Estate, SRS, SRS-23-03, UNG, UNG-23-05

Stopped-Out

Sometimes you feel like kicking the computer.

In a way, today is, and is not, that day.

The IYR short, SRS-23-03, was stopped-out for a loss of 0.32-pts, about – 1.68%.

Not too bad, but not the desired outcome (not advice, not a recommendation).

As of this post (2:10 p.m., EST), the UNG trade (UNG-23-05) is testing its reversal, covered in this update.

Nat-Gas, UNG, Daily

Coming back to test a reversal as shown above, is normal market behavior. One just has to wait for the market to work itself out.

Positioning

The initial position UNG-23-05, remains intact with a hard Stop at 6.29 (not advice, not a recommendation).

However, after today’s session, that stop is likely to be moved to the day’s low; currently UNG 6.43 (not advice, not a recommendation.

Any further downside testing after today points probability to a trade failure.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Real Estate’s Massive Channel

November 11, 2023 By in IYR, Livermore, Positions, Real Estate, SRS, SRS-23-03

Trading Channel, A ‘Mile-Wide’

We all know something’s coming; we just don’t know what.

A century ago, Livermore said, ‘surprises typically come in the direction of trend’.

Back in August, this update said if certain conditions were met (trend breakdown), then real estate has ‘enormous downside potential’.

Since then, events have unfolded to increase the probability of downside for IYR (not advice, not a recommendation).

The weekly chart of IYR spells it out. We’re in a (potential) massive downside trading channel.

Real Estate IYR, Weekly

From the left side low (October 2022), to the right-side test two weeks ago, is Fibonacci 55 weeks, plus one week; well within an acceptable margin of error for timing.

Anything can happen and IYR could somehow power higher into more testing or a channel breakout.

Until then, positioning in this sector remains as follows (not advice, not a recommendation).

Positioning

The current short position via Leveraged Inverse Fund SRS, is identified as SRS-23-03.

The initial entry was documented here and here.

Hard Stop is SRS 19.25, with a Soft Stop (discretionary) at SRS 19.79 (not advice, not a recommendation).

As of Friday’s close, initial position profit is about + 5.7%.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Nat-Gas Washout, New Lows

November 10, 2023 By in Natural Gas, Positions, UNG, UNG-23-05, Wyckoff 1 Comment

Is Now, The Time?

Let’s remind ourselves why there’s trading interest in Nat-Gas; putting it succinctly, ‘disruption‘.

We have disruption in nearly everything else (food supply, auto parts, medicines), why not the infrastructure?

The premise for the opportunity (if one can call it that), was discussed months ago. The work, the idea, the strategy has already been covered.

It turns out, other professionals had the same idea, prompting this update.

Those speculators needed to be washed out before a potential set-up could be created.

We may be there now; Nat-Gas proxy, UNG, is at The Danger Point® (not advice, not a recommendation).

Nat-Gas UNG, Daily

As of this post (10:45 a.m., EST), UNG has penetrated support and is trading in a narrow range.

Breaking below support (blue line) puts UNG, in Wyckoff Spring Position, ready for potential reversal.

Note the heavy down volume (purple oval) with little net downside progress.

Positioning

Could UNG post lower? Certainly, anything can happen.

Have the longs been washed out?

Volume, price action and time say, if it has not happened already, we may be close.

An initial long position has been opened at UNG 6.34, with tentative stop at the session low, currently, UNG 6.29 (not advice, not a recommendation).

Trade is identified at UNG-23-05.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Real Estate’s Failed Test

November 9, 2023 By in IYR, Positions, Real Estate, SRS, SRS-23-03

If … It Holds

We’re on Fibonacci Day five of the real estate reversal; this could be the turning point for the next leg lower.

When looking at the daily close of IYR (below), it’s clear, if yesterday was the attempt to move higher, as of this morning, that attempt, has failed.

If downside price action holds, we have IYR only able to retrace a Fibonacci 23.6%, of the down move from the November 3rd high; very weak indeed.

Real Estate IYR, Daily Close

The initial move lower was a Fibonacci three days.

Then, the test (yesterday) and now today, a new high of 0.01-pt, (from Tuesday’s high) before posting lower.

Anything can happen.

A retrace of only 23.6%, is rare.

Typical retrace amounts are 38.2%, and 50%.

The action we are observing, could just be a set-up for a future, higher retrace.

Positioning

In the meantime, I am remaining short this sector via Leveraged Inverse Fund SRS (not advice, not a recommendation).

That trade is noted as: SRS-23-03.

The position stop has been moved from SRS 18.70 to SRS 19.25, with today’s low of SRS 19.79, as a discretionary stop (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Santa Clause Rally?

November 4, 2023 By in IYR, Positions, Real Estate, SRS, SRS-23-03, ZeroHedge 2 Comments

Here We Go, Again

In the markets, anything can happen.

There could be a sustainable rally into Christmas but is that the highest probability?

When looking at the chart of real estate IYR, the short answer is (most likely) no.

Strategy Review

Back in August, potential for the breakdown of a fourteen-year-long, trendline was identified.

Since then, we’ve had that break.

Then, this past week was a test of the breakdown.

As we’ll see in the chart below, from a trading standpoint, we’re at The Danger Point®

Price action closed the week hovering just below resistance in what looks like a sharp short-covering rally.

Real Estate IYR, Daily

As shown, a short position was opened via Leveraged Inverse Fund SRS, as price action was backing away from the blue-line resistance area (not advice, not a recommendation).

We’ll find out at the next open, if going short was a good idea or not. 🙂

The important part is, we’re at resistance.

If IYR, is to continue to rally, it would probably need to spend time at that resistance absorbing all the sellers.

If so, that gives the speculator a hint, higher prices are ahead and to exit the trade (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Real Estate … The Breakdown

November 3, 2023 By in IYR, Positions, Real Estate, SRS, SRS-23-03 2 Comments

Now, It Gets Interesting

Back in August, this post identified the potential for a long-term breakdown in real estate, IYR.

Since then, IYR broke its trendline.

As of today, we have a potential test of that break.

Real Estate IYR, Weekly Close

The chart shows the breakdown from the wedge and now, an underside test.

Subsequent updates will get closer-in on the action (daily chart) to show the breakdown and test.

Positioning

Right around mid-session, IYR price action appeared to be making its highs. At that point, a short position via Leveraged Inverse Fund SRS, was initiated at SRS 19.02 (not advice, not a recommendation).

Trade identification is, SRS-23-03.

The stop has yet to be determined (will be set next session) but is likely going to be today’s SRS low @ SRS 18.70 for a ‘risk’ of about, 0.32-pts.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279