Category Archives: Positions

NVDA … Testing The Reversal

August 14, 2023 By in GLD, Gold & Silver, NVDA, Positions, Prechter, South Sea Bubble, SOXS, SOXX 1 Comment

The ‘Downside’ Reversal

The AI, mania’s looking a lot like the hysterical gold bugs from years ago.

Just to remind everyone what it was like.

Gold links below are nearly two years old and $3,000/oz. gold is nowhere in sight:

Von Greyerz: Gold-O-Mania Is Coming!

Gold Breakout Imminent!

Gold shhh…

Gold Probes Multi-Month Highs

“$3000 In Months, Not Years”

Gold & The Dollar Soar

Gold & Crypto Surge

The AI Bubble … Past The Top?

Moving on, this post said as we reverse and head lower, expect the hysteria to increase.

You’ll have to be the judge on whether or not the hype has moved to the next level:

Jim Cramer Thinks

‘Pullback Will Be Short-Lived’

Nvidia jumps 6%

Chipmakers Rally

Tepper’s Appaloosa places big bets

UAE said to buy ‘thousands‘ of Nvidia GPUs

NVDA, Historical Chart

The weekly chart of NVDA from 1/15/99, to present, puts the situation into perspective.

Recall, from a previous post, Prechter indicates, we haven’t been at these extremes in over 300-years.

Positioning

It was a rough day to be short the Semiconductor sector via inverse fund SOXS (not advice, not a recommendation).

However, the position remains intact with Hard Stop unchanged @ 9.42.

In the after-hours (as of 7:03 p.m., EST), inverse fund SOXS continues to edge lower; currently trading @ SOXS 9.78.

The NVDA earnings report is moving ever closer.

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

‘It’s Just a Flesh Wound’

August 11, 2023 By in NVDA, Positions, Semiconductors, SOXS, SOXX, Van Tharp, Wyckoff 2 Comments

So, Now It Starts

It’s like the knight in Monty Python.

We have the usual suspects being rolled out to let us know, there’s nothing to worry about.

Links here, here and here.

This one, is especially ripe.

Watch until the end (if you can stomach it) where the host asks in exasperation, after a 200% gain in NVDA, ‘is there really more upside?’

At this point (as of 11:05 a.m., EST), the answer is no.

Forces Of Thier Own

All the way back in 1902, Wyckoff discovered after studying the tape (the Ticker):

‘Forces were at work, moving prices, that had no connection to real values.’

That, ladies and gentlemen, is all you need to know.

Fundamentals are just a well-orchestrated ruse to keep the public thinking, if their pencil’s sharper than the next guy’s (think FactSet), they’ll have the market figured out.

Wyckoff ‘Nails It’

So, he we are.

Using Wyckoff analysis (reading the tape) the probability for the current reversal, was identified within a day.

The subsequent short position (via SOXS) was stopped out yesterday, almost lost completely, but for the re-entry @ SOXS 9.70 (not advice, not a recommendation).

As of this post, we’re a full point higher at 10.70, an 11%, gain in just hours … not bad.

With that said, we’ll shift gears a bit and go straight to the leveraged inverse fund SOXS, but use a 3-Day chart.

Semiconductors Leveraged Inverse SOXS, 3-Day

The 3-Day, is being used as the market itself has defined (for now) it shows price action characteristics more clearly.

Distance between the entry and the stop is 0.28-pts.

As a position size example:

Risking $1,000 on the trade would result in a size of 3,571-shares of SOXS (not advice, not a recommendation).

For more information on sizing, see Van Tharp, link here.

Note: There’s a big price difference (over 450%) between the Wycoff text and the Van Tharp text … just sayin’.

Next Steps

At this point, there’s not much to do on this trade (not advice, not a recommendation).

Keep in mind we’re at an historic bubble extreme, the likes of which has not been seen since Sir Issac Newton lost his fortune over 300 years ago.

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 ‘Right’ Trade Entry

August 10, 2023 By in Dr. Elder, Positions, Semiconductors, SOXS, SOXX 2 Comments

Professional vs. Amateur

Quickly: An update (as of 11:05 a.m., EST) on the short position in the SOXX.

Early session had an exit at the Hard Stop SOXS 9.46, as planned.

Then, price action as it sometimes does, began to exhibit behavior akin to a wash-out.

The short via SOXS, was re-established SOXS 9.70, with a new Hard Stop @ the session low of 9.42 (not advice, not a recommendation).

Perfect vs. Professional

Years ago, Dr. Elder talked about how the professional may try several times to get the entry he wants.

The amateur will only try once. If he gets stopped out, it’s as if a parent (the market) is giving him a whack for being wrong.

It’s a difficult psychological barrier to overcome but you’re witnessing it in real time 🙂

Charts to follow in a later update.

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

Stupid ‘AI’ Short-Sellers

August 9, 2023 By in Positions, Semiconductors, SOXS, SOXX 1 Comment

Everybody Knows, AI’s The Way To Go

As if on cue, we have this piece of propaganda out from the mainstream.

‘AI short sellers lose big‘

Of course, there’s some truth … that in-total for the year, short positions have not been continuously profitable.

Contrary Indicator

The article represents another (potential) contrary indicator; short sellers (those that are left) may be about to ride the wave down (not advice, not a recommendation).

As the AI mania collapses, we’ll have the same set of clowns demanding short-selling be banned. 🙂

So, let’s see what our favorite AI chief cook and bottle washer’s doing in today’s session (as of 11:30, a.m., EST).

Semiconductors SOXX, Daily Candle

Ruh-Roh Scooby.

The daily chart has a terminating wedge that’s now breaking to the downside.

The magenta arrow with the ‘Note’ indicates, the current reversal was identified to the day; link here.

The dangerous part is, if the SOXX follows the ‘rules’ laid out in this link, it’s likely to be a swift and merciless decline (not advice, not a recommendation).

Positioning

With no obligation to do so, here is how I have addressed the SOXX, set-up thus far (not advice, not a recommendation).

Note: SOXS, is a ‘leveraged inverse’ fund for the SOXX

August 4th had two entries same-day, as noted.

This series is the fifth trade campaign in the SOXS for the year (SOXS-23-05).

Hard Stop is today’s session low of 9.46 (not advice, not a recommendation).

Obviously, with the SOXS currently at 9.97, all positions are well in the green.

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

Will SOXX, Follow The Rules?

August 7, 2023 By in Positions, Prechter, SOXS, SOXX, The Maverick of Wall Street 2 Comments

In A Knife Fight? … No Rules !

What’s happening in the markets is important but so is what’s not happening.

The SOXX, as of 1:15 p.m., EST has not made a new daily high.

Price action’s hovering in a tight range and looks to be coiling for a directional move.

If the breakout is to the downside as anticipated, here is where the ‘rules’ come in.

The ‘Rule’ of Alternation

Originally discussed by Prechter years ago, as an observation, the rule is basically described as:

‘The market will alternate in wave structure from complex to simple or from simple to complex.’

When we look at the SOXX, the implication is, we may be due for ‘simple’ wave structure (not advice, not a recommendation).

Semiconductors SOXX, Weekly Candle

The weekly chart shows the potential.

The first leg down was complex, overlapping price action.

If there’s a break to the downside, the ‘rule’ says to expect price action to alternate from a prior complex structure, to simple (not advice, not a recommendation).

The Maverick of Wall Street

One recent example of such a move can be found at this link, time stamp 11:20.

Stay Tuned

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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 MAERSK ‘Message’

August 5, 2023 By in GLD, NVDA, Positions, Prechter, Semiconductors, SOXS, SOXX

‘He’s Dead, Jim’

What’s the MAERSK message?

The economy has collapsed.

He’s Dead, Jim

But wait! We’ve already written the script on what happens next:

Buy the dip, soft landing, no collapse until after the ‘elections’, stocks to soar, bull market just starting.

The Propaganda, Bot

A Bull Market Is Coming

Morgan Stanley thinks it’s a buying opportunity

Have Patience, Intel Investors!

Is this the crash-proof economy?

Not Time to Worry

The AI, Bot

Meanwhile, the SOXX and its loyal henchman, the AI bot, may have just ‘changed hands’.

Well, actually leveraged inverse SOXS, could be changing hands, shown below on the weekly chart.

Semiconductors Leveraged Inverse SOXS, Weekly

The massive volume in SOXS, over 369-million shares for the week represents (at the closing price) over $3.4-bln.

That may be the inflection point (not advice, not a recommendation).

As a reminder, here’s another example of ‘changing of hands’, link here. Since then, GLD has not topped that level.

Three-Hundred, Three Years (33)

Not since the South Sea Bubble of 1720, has there been an environment such as this.

Reference time stamp 11:10, in the link.

NVDA Earnings, Tick-Tock, Closer

One has to wonder, how NVDA, is going to ‘spin’ its upcoming earnings release and how the market will react.

Will it be, ‘buy the rumor, sell the news’, or just good ‘ol fashioned ‘sell’. Maybe it will be ‘buy, then sell’. 🙂

Who knows but it looks like the rest of the market’s not waiting around to find out (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

Niger News, De-Risks ‘Short’

July 31, 2023 By in DUST, GDX, GDXJ, GLD, Gold & Silver, Gold Miners, JDST, Positions, ZeroHedge 1 Comment

Gold Output Miniscule, On World Stage

A military coup in Niger results in gold shipment suspension.

Correspondingly, the mining sector along with gold and silver, are higher.

The real question is, will gold, silver, and the miners continue upward or is this just an excuse to force out the weak (short-positioned) hands?

If we look at the facts, such as Niger’s gold output compared to the rest of the world, it’s miniscule; hardly a blip and production is decreasing.

Add in, the mining sector has not been in a bull market for years, and we’ll surmise, the current move higher has low probability of continuing (not advice, not a recommendation).

For today’s session (as of 3:11 p.m., EST), price action has effectively been slammed into resistance as shown.

Junior Gold Miners GDXJ, Daily

For positioning short (via JDST) this is potentially a low-risk area (not advice, not a recommendation).

There would need to be continued demand for a move higher past the resistance area (blue line).

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

Back To The ‘Elephant’

July 28, 2023 By in $SPSIBI, LABD, Positions, SOXS, SOXX, SPBIO, The Speck

The ‘AI’ Dog Keeps Biting

Upward price action in the SOXX, held overnight and then some.

A discretionary exit was made in the pre-market session at SOXS 8.42 (not advice, not a recommendation).

Switching gears, we’re leaving the SOXX and AI alone for now.

As mentioned in a prior post, the life insurance sector appears to be correlated with biotech. It’s a fact the life insurance companies are talking a hit from ‘excess’ payouts.

We all know or should know just what’s causing the ‘excess’, so we’ll leave it there.

That leads to the biotech sector (SPBIO) and what appears to be a downside reversal.

Biotech SPBIO ($SPSIBI), Weekly

When looking at the chart for the past three years, one thing is certain; this is not a bull market.

The blue arrow shows the location of a short position opened (via LABD @ 14.70) in today’s pre-market session (not advice, not a recommendation).

A Hard Stop for the position is LABD 13.31.

Since that’s a fair distance from the entry, a discretionary exit may be made by the trader at any time based on the behavior of price action going forward.

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

When The ‘Dog’ Barks

July 27, 2023 By in INTC, Positions, Semiconductors, SOXS, SOXX

Intel (INTC) Up, In After-Hours

After-hours trading for Intel, show it’s up around +7%.

The company managed to post a profitable quarter; so, naturally the stock ‘launches’ based on the hopes of ‘recovery’.

One has to suppose the ‘n/a’ currently listed as P/E, reported by bigcharts.com, here, will be revised to show at least something.

SOXX, After Hours

A volatile day continues in the after-hours with SOXX, trading up about +0.66% (at 525.13).

The real question is, will that hold through to the next session or will it evaporate overnight.

Today’s Action(s)

As stated early in the day, the short position via SOXS, was exited with a profit for the trade series, around +3.7%.

The Semiconductor short via SOXS, was re-established later in the session at lower prices.

The new Hard Stop exit, is the SOXS low of 8.32 (not advice, not a recommendation).

Dogs Barking

We’re at the stage in this mass-psychosis mania where dogs (INTC), are starting to bark.

A full-blown downside, sustained, semiconductor (AI) reversal seems to be very close.

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

Pre-Market … Exit

July 27, 2023 By in Positions, SOXS, SOXX 1 Comment

Taking Action Quickly

As of 7:21 a.m., EST in the pre-market session, the short positioning SOXS has been exited at Hard Stop 8.91 (not advice, not a recommendation).

Details on the trade to be released later (including a potential re-entering of position) later in the 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