Category Archives: Positions

Tesla Top, and Fibonacci

February 11, 2023 By in GM, Positions, TSLA 2 Comments

Options Day-Trade, Nets … 170%

It’s no secret that Tesla’s a Ponzi scheme mania.

Its current market capitalization is over ten-times that of General Motors (GM); a company that’s been in business, since 1908.

GM’s auto production numbers for 2022, were 66% higher (imagine that), than Tesla’s 1.37-million; provided, that we actually believe any of the data. 🙂

If we take Tesla’s market cap as of Friday’s close (654.7bln) and divide it by the closing price of 196.89, we get 3.33.

You can’t make this stuff up.

The TSLA market has ultra-high liquidity and is highly emotional (like the gold market). That liquidity lends itself to Fibonacci-based analysis.

We’ll get to the analysis but first, the options trade.

Tesla TSLA, Option Trade: 3-minute Chart

We’re trading the day of expiration 2/10, and the value is decaying rapidly. The entry of 0.50 was about where the option closed on the prior session.

Note, the entry was made on the way up … extremely difficult to stomach selling short, on an expiring position, as the price is rising.

Option was closed when it was obvious there was no more downside for the day. Since it was a 195.0 Put, it expired worthless at the end of the session.

Now, on to Fibonacci.

Tesla TSLA, Daily, with Fibonacci Projection(s)

The chart shows how precise the moves have conformed to Fibonacci.

We’ve included the “3.33”, as mentioned above; it will be interesting to see what happens at the next open.

After-hours activity was down – 2.31 pts, on 2,486,196 shares, according to BigCharts.

Depending on subsequent price action, the next update will address the Fibonacci downside projections.

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


Biotech Bobsled, Starts … Down

February 9, 2023 By in $SPSIBI, Biotech, DRV, IYR, LABD, Positions, Real Estate, SPBIO 1 Comment

Slowly, At First

Of all the major indices for today’s (Wednesday) session, biotech’s SPBIO, Leveraged Inverse Fund LABD, had one of, if not the largest gain @ +10.48%.

The last update identified two sectors to watch for short positioning: Real Estate IYR, and Biotech SPBIO; Short positioning via leveraged inverse funds DRV, and LABD, respectively (not advice, not a recommendation).

Since that post, DRV is up + 1.74%, and LABD is up + 8.58%, both measured on a close basis.

The ‘Big Reveal’

Remember: When price action turns south, that’s when the bad news comes out.

If this is the big reversal and biotech is the downside leader, unfortunately, that could mean a planned ‘reveal’ by the mainstream media.

Anyone going to alternative sites such as BitChute, ZeroHedge, Rumble, know full well what’s happening.

Maybe we’ll have another distraction like the 100-th (at last estimate) food processing plant fire or even something totally retro, like a balloon flying across … oh, wait. 🙂

Biotech SPBIO, Leveraged Inverse LABD

We’ll get straight to the point as prior updates have built a substantial case for a long term, significant reversal.

Recall, LABD is the leveraged inverse of SPBIO. The daily chart shows the current set-up.

This site does not provide investment advice.

With that said, one could infer from this prior post (at the bottom), a position in LABD had already been established and included a hard-stop.

That was indeed the case.

Next Steps

There’s no guarantee on how far or how long a directional move will go.

However, for SPBIO, one can observe since the February 2021, reversal from all-time highs, a sustained, directional move typically lasts 4 – 6 weeks.

The next update will show the best chart timeframe (multiple days) that resulted in capturing the majority of the directional moves since the February 2021-high.

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

Delta Airlines … The Short Set-Up

January 14, 2023 By in Airlines, DAL, Dr. Elder, Positions, S&P 100, ZeroHedge 1 Comment

Hanging In ‘Mid-Air’

It’s a good thing we’re not listening to the financial press as the market’s ‘Call The Fed’s Bluff’; we would’ve missed the set-up.

Let’s bookmark this post (like the last one), come back in July or so, and see how the poker-hand with The Fed played out.

Three guesses on who’s going to win and the first two, don’t count. 🙂

With Delta, it’s not the Fed they have to worry about. A series of events were set in motion (i.e., pilot ‘shortage’) that may not get fixed for years to come.

Ditto, for the other airlines.

Moving on, let’s take a look at what the price action of Delta (DAL), is telling us.

For brevity, we’ll go straight to a marked-up (and time compressed) weekly chart of DAL.

Delta Airlines DAL, Weekly

DAL spent nearly a year building a ‘terminating wedge’ before breaking down during February of 2020.

Hmmm, February of 2020, what was happening back then?

That breakdown, coupled with the terminating wedge, and it’s almost as if someone knew something; time enough to position massively short or buy put options.

Subsequent retrace off the 2020 lows, were at lower and lower Fibonacci levels … with the current retrace at 50%.

The Options Trade

Dr. Alexander Elder describes (Come Into My Trading Room) one way to trade options that few attempt.

That is, instead of buying long dated options and then waiting for the slow burn down of capital, the lesser-known method is exactly the opposite.

In his book, he describes buying short-dated OEX (S&P 100) Put options for 3/8ths … back in the day when the market traded in fractions.

Two days later, he sells the options for 17, a 4,433% gain.

Taking that method and applying it to the daily chart, we have the following.

Delta Airlines DAL, Daily

On Friday, there was a huge gap-lower, open.

Price action spent the rest of the session attempting to close the gap. Volume increased substantially from Thursday’s session (up +46%)

Yet, price action was not even able to touch the lows of that session; Friday’s high of 38.29, vs. Thursday’s low of 38.32.

It’s a nuance that may have meaning or not.

The Short Trade

As shown on the chart, a position was opened with a Put; strike at 35, and priced (at entry) at 0.09 (not advice, not a recommendation).

Following Elder’s method, the price and short expiration, says there’s no hope for this trade.

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

Biotech … Behind The Scenes

January 10, 2023 By in Biotech, IBB, BIS, DXD, Wyckoff, Positions, David Weis, SOXS, ZeroHedge, SDS, QID, Speck-Effect, BIS-23-01

The Big Reveal

Was yesterday, the infection point?

Was that the day where irrefutable evidence like this is going to stick?

Price action of Biotech Sector IBB, has posted a long awaited and anticipated reversal signal (not advice, not a recommendation).

We’ll look at that below.

The IBB, Up-Thrust & Reversal

As a reminder, in Wyckoff terms, an ‘up-thrust’ is where price action struggles above known resistance for some period of time and then reverses to the downside.

In the case of IBB, that ‘struggle’ lasted an incredible seven-weeks.

Biotech IBB, Weekly

Price action attempted to break above resistance for nearly two-months, before reversing lower.

Then we had an initial test during the week of 12/23/22 (on the daily for three days), and a secondary test last week.

Biotech IBB, Daily

The daily shows more detail on the struggle.

Point No. 1, was the initial test. Point No. 2, was the secondary test which appears to have decisively failed.

Pre-market action shows IBB, set to open slightly lower.

If it does, then expectation is for some (brief) attempt to rally as a test of the breakdown.

The Driving Force

For years, this site has not wavered in the assessment, what’s happening in this sector, will be the driving force for the entire market on a go-forward basis (not advice, not a recommendation).

Anything can happen.

It’s unknown if yesterday was ‘the day’.

What is known however, evidence is building on a massive scale. Every day, sometimes multiple times a day, we see the effects.

Positioning

This site presents the data, the insight and price action nuances. It does not give recommendations.

With that said, going short this sector is not as straightforward as the other major indices.

IBB, may be shorted directly but will likely result in a maintenance fee from the broker.

Of course, that puts one on the hook for the sector’s dividend payment (currently yielding 0.31%).

The other option is 2X leveraged inverse fund BIS.

However, this fund’s volume is thin … meaning it’s not nearly as liquid as the other inverse funds such as SDS, DXD, QID, SOXS and so on.

It’s up to the trader/speculator to participate or not.

We’re about fifteen-minutes before the open. Let’s see what happens next.

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

Oil Today … Gold Tomorrow

January 7, 2023 By in 1987, DRIP, DRIP-23-01, Federal Reserve, Jerimiah Babe, Positions, Taleb, Van Metre, Wyckoff, XOM, XOP, ZeroHedge 4 Comments

Commodities, Have Peaked

First, we’ll review oil; tomorrow, we’ll look at gold.

From an intuitive standpoint, you can almost feel it.

The oil and gas sector has launched to unsustainable highs.

Behemoths like Exxon (XOM) with its 63,000 employees have gone from below $30/share to above $110/share, an increase over 280%, in just two years.

In the history of the equity, going all the way back to 1984, that’s never happened.

Even in 1987, before the crash, XOM was up for the two-year period, a paltry 108%, by comparison.

Now, data is coming in nearly by the day about collapsing demand, layoffs accelerating, and inventories piling up.

The latest from Steven Van Metre, at time stamp 4:25, discusses just how fast the downdraft is, and will be.

Important Note:

Before we leave the Van Metre link above, at time stamp 8:50, the assertion is made of what the Fed will do when slower growth data comes in. i.e., interest rates will be halted or lowered.

Nassim Talib called this kind of thinking “Normalcy Bias”.

The opinion of this site is, it’s a trap. Thinking what happened last time, will happen this time.

Let’s mentally bookmark this post and come back six-months from now to see what happened.

We’re in uncharted territory and other agendas are at work.

Like ‘bread and circuses’, the ‘pivot’ discussion is a distraction … keeping the proletariat placated.

Demand Collapse

We’ve got demand collapsing on a daily basis right in front of our faces and yet, it’s a big mystery (to some).

What’s not known, is how the general population will react to undeniable truth when it finally hits, en masse.

We have a good hint of what’s in store as reported by Jerimiah Babe during the first minute of this report.

Moving on to the Oil & Gas Sector.

Oil & Gas XOP, Weekly

The weekly chart shows the multi-year resistance area that was tested (and rejected) back in mid-June, last year.

The next chart shows we also have a terminating wedge.

Price action has come back to the lower boundary; suggesting a breakdown is a probability.

If we get a breakdown, measured move support is identified at approximately -47%, below current levels.

Strategy & Trading

Obviously, the charts paint a bearish picture.

Over the past week, XOP was covered here and here.

The first link discussed how price action was very close to making a new daily high. That happened the next session (Friday) and indeed, it had Wyckoff ‘spring’ characteristics.

Price action moved higher and closed higher for the day, but it did not post a new weekly high … keeping the bearish case on the table.

A popular leveraged inverse fund is DRIP (not advice, not a recommendation).

At The Close

As this post comes to a close, a quick check on ZeroHedge turns up this: ‘Tipping Point‘

We’ve jumped over ‘recession’ and have gone straight into crisis and depression.

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

The 15-minute, ‘January Effect’

January 3, 2023 By in DRIP, DRIP-23-01, DUG, IYR, Livermore, Oil, Oil & Gas, Positions, QQQ, S&P, S&P 500, SPY, XOP 2 Comments

That’s All There Was

If we use the S&P as the proxy, it hardly even lasted that long.

Going back to just four days ago, we had this (emphasis added):

“It’s well known, stocks tend to rise in the first weeks of January. Tax loss selling is over and there’s typically some type of ‘relief’.

Don’t count on it this time (not advice, not a recommendation).”

Market Meets Expectations

It was expected on the first trading day of the year, the market would continue its downtrend.

After this morning’s 15-minute blip, that’s exactly what’s happening.

We’ve already discussed real estate IYR, (here, here and here) as well as the Q’s (here).

Now, there appears to be another sign of impending price collapse … the oil sector; specifically, Oil & Gas Index XOP.

As is typical, we’ll begin the analysis with the longer time frame, the weekly.

Oil & Gas Sector XOP, Weekly

There’s no secret to the chart below other than Livermore’s admonition for going short; that is, he finds a market that ‘goes down and stays down’ (not advice, not a recommendation).

The prior two down-drafts were quickly retraced; one in mid-July last year and one in September.

Not so, this time.

If we go to the daily, we have an ominous look where a downtrend could be validated.

Oil & Gas Sector XOP, Daily

The right-side trend is drawn as a dashed line, revealing the attempted breakout on the last two sessions in December.

Attempted trend line and channel breakouts are normal market behavior.

It’s clear in the case above, price action has quickly got itself back into the trading channel.

Summary

Of course, oil prices are not supposed to go down, right?

At this juncture, look at all the conflict and potential supply disruptions that are possible.

However, the price of oil and the price of the exploration/production equities are two separate things.

The price of oil could skyrocket further, and yet, the equites still collapse. Bear markets are all about price, wealth, and credit destruction.

Typical short positioning trade vehicles for this sector are DRIP (-2X) and DUG (-2X), or to short the XOP directly (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

The Panic of 2023

December 30, 2022 By in 1907, 2023, Boer War, DRV, dutchsinse, IYR, J.P. Morgan, Jerimiah Babe, Livermore, Neo Feudalism, Positions, Real Estate, South Africa 3 Comments

Parallels To, The Panic of 1907

Pick up almost any trading book like Reminiscences of a Stock Operator, and you’ll find, the big money was made on the downside.

In Livermore’s case from ‘Reminiscences’, he saw a big crash coming, went short in a big way, and was then squeezed out of his positions during market rallies in 1906.

The short trades were too early; he blew up his account.

Undaunted, he took drastic measures to raise capital (hawked his car), got back in, shorted, and cleared over $1-milllion in profits near the bottom on October 24th, 1907.

The Ukraine War & The Boer War

As spectacular as his profits were, for us that might not be the most important part.

Take a look at the list below, paraphrased from Livermore’s account of The Boer War and overall economic conditions; see if it doesn’t match up to today.

The British were just coming off the Boer war, having spent hundreds of billions (in today’s Pound-Sterling), and money was tight.

There was significant wealth destruction world-wide.

The San Fransico earthquake of 1906, was causing economic disruption and the need for even more cash.

Note: As reported here, seismic activity is picking up. We’ve just had a major quake (again) in California.

There were plenty of warnings of an impending collapse but as Livermore puts it, the masses paid no heed as they were more concerned with baseball.

Fabrication & Fact

There’s some scuttlebutt, The Panic of 1907, was a fabricated event, used to usher in fractional reserve banking.

Is this all starting to sound familiar?

Now, we have the potential of Neo Feudalism, going right along with Universal Basic Income and Digital Currency.

That should be enough intro to get us to the chart at hand, Real Estate IYR, but first, this just out, on MarketWatch:

Worst Year, Since 2008.

It’s already the worst since 2008, and as Jerimiah Babe puts it, ‘we haven’t even got started’.

Reference time stamp 12:07, in the link and see if it does not match exactly with Livermore’s observations.

All of which brings us to real estate.

Real Estate IYR Weekly, Close

The chart shows the most conservative (modestly declining) trading channel

The next chart, is where it gets scary.

The second (potential) channel is declining at approximately -62%, on an annualized basis.

Weekly timeframes are presented here on purpose.

Doing so, gets us away from the everyday, every blip, analysis and looks at things strategically. It’s obvious, barring some kind of intervention, real estate’s in trouble.

The January of No Effect

It’s well known, stocks tend to rise in the first weeks of January. Tax loss selling is over and there’s typically some type of ‘relief’.

Don’t count on it this time (not advice, not a recommendation).

Even as this post is being created, IYR, is pivoting lower and possibly confirming the more aggressive right-side trendline (second chart, above).

Summary

We’ll end with more paraphrase from Livermore’s account of the panic.

He describes being in Ed Harding’s office (his broker), telling him that ‘now is the time’, ‘today is the day’. All the while, stocks were drifting, everything was quiet.

Livermore said to Harding:

‘The longer that stocks delayed, the bigger the break will be when it comes.’

Let’s see if that applies to us, exactly 100-years later (Reminiscences, published in 1923).

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

Trend & Channel

December 27, 2022 By in IWM, IYR, Nasdaq, NFLX, Positions, QID, QQQ, Russell 2000, S&P, S&P 500, SPY, TDA-QID-22-01, TZA, TZA-22-02, ZeroHedge 1 Comment

Get In … Get Out

There tends to be a period of consolidation and organized chaos, before price action enters and exhibits channel behavior.

Of course, the problem from a trading perspective, be able to wait through the chaos getting to the set-up and that’s no small feat.

Several of the major indices are in a channel right now. Those are (ETF symbol) SPY, QQQ, IYR and IWM.

We’ll discuss the Q’s farther down but first, this just out, on ZeroHedge, concerning the overall economic conditions.

That is, we’re already in full scale economic collapse and they have the data to prove it.

As incredible as it may be, there are still sectors of the population that believe, ‘the consumer is strong’.

A big wake-up call is coming for them. Oh wait, is that a telephone ringing off in the distance 🙂

The media lies appear to be crumbling at an exponential rate; there’s no guarantee it’ll all hold together into late January, or mid-February as presented only yesterday.

From a Nasdaq (QQQ), technology sector perspective, we have the following.

NASDAQ QQQ, Weekly

The Q’s began the week with a lower open and within the range of the prior week.

It’s a subtle clue the direction remains down and the market’s not volatile … just yet.

Next up, is the channel

It has the right ‘look’.

Moving in closer; the right-side trend line verification (hits).

There are no fewer than four weekly hits (including today) that verify the right side. The attempted push out of the channel is identified as the ‘Throw-Over’.

Attempted breakouts (and failures) are common market behaviors. We see that price action quickly got itself back into the channel.

Get In … Get Out

At this juncture, price action remains in the channel.

A short position (via QID, or equivalent) is a viable choice for the trader/speculator (not advice, not a recommendation).

For the reasons described above (the collapse), we appear to still be in the early stages of the down channel.

Obvious discretionary exit points for a short trade would be left side contact of the channel i.e., the ‘demand’ side or a decisive right-side breakout i.e., the ‘supply’ side (not advice, not a recommendation).

Summary

In a separate market, Netflix (NFLX), may have hit the right side of its own tend line as well.

It seems to be all happening very quietly.

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

Biotech Disconnects & The Claus

December 23, 2022 By in Biotech, Russell 2000, LABD, Wyckoff, The Speck, Positions, IWM, ZeroHedge, SPBIO, Vernon Coleman, TZA, Speck-Effect, $SPSIBI, TZA-22-02 1 Comment

Naughty or Nice ?

Biotech price action’s disconnecting from the rest of the market.

Around the last Fed meeting, biotech separated from the major indices, heading the opposite direction, i.e., sideways to higher.

We’ll see that as we get into the snapshots of the hourly charts (below), but first several clues on why biotech (so far) isn’t going along.

The Next Plan Rolls Out

First up is this, just out on ZeroHedge.

It appears the next push is on … and the target is the kids. Another wave of ‘protection’ is certain to boost profits.

Note: Those commenting on ZH have been ‘awake’ from the start; an invaluable resource.

Next up is this, just out on BrandNewTube; another clear thinker that helps ‘tie it all together’.

Is this the explanation for biotech’s current behavior?

Strictly speaking and from a Wyckoff perspective, we won’t know the real reason for a move until it’s nearing the end.

What we can see, is that character of price action has changed (again).

With that, we’ll look at the 3X, leveraged inverse funds of two indices, Russell 2000 (TZA) and SPBIO (LABD).

TZA & LABD, Hourly

The disconnect has been a recent observation.

We’ll drill right down to the hourly and put the charts one on top of the other.

We can see that while inverse TZA, is now back up to the pre-squeeze high, inverse LABD, is far below that level.

That’s not to say things can’t change quickly.

For now, however, there may be something else going on that’s keeping the sector buoyant and suppressing the LABD, inverse fund.

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

Downside Kick-Off … and, Biotech

December 22, 2022 By in Biotech, Russell 2000, LABD, Positions, IWM, Catherine Austin Fitts, Stew Peters, TZA, $SPSIBI, LABD-22-14, TZA-22-02, Greg Hunter

Biotech, And The Next ‘Event’

Now, it all makes sense.

The solstice was yesterday.

Hard reversal in the market, today.

Then, there’s biotech; stubbornly refusing to break down.

First, Some Housekeeping

Before we go any further, from a housekeeping standpoint, all biotech short positions have been closed (not advice, not a recommendation).

Each apparent downside breakout attempt for the past three months, has been thwarted. There is something else going on.

Possible reasons for biotech’s resilience can be found here, and here and here.

Hint: There’s another planned ‘event’, on the way.

Now, back to the markets.

All major indices are sharply lower but for this update, we’ll focus on the Small Caps (Russell).

Russell 2000 IWM, Daily

Instead of starting with the big picture and longer timeframes, we’ll get straight into why today’s action may be significant.

Yesterday, price action attempted to ‘spring’ off the support boundary. Today, that spring has apparently failed.

Failed moves bring out the other side in force; in this case, the bears as it’s obvious the opposing side, the bulls, are exhausted.

It’s getting late in the session (2:50 p.m., EST) and the expectation is for a lower close.

If this really is the kick-off to the downside, then we’ll expect some kind of follow through at the next session.

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