SD - 2022 - A YEAR TO LOSE LESS AND TO KEEP MORE !

[sd]

9-13-2022
FUTURES IN THE GREEN EXPECTING A POSITIVE cpi REPORT THIS MORNING TO SET THE TONE FOR THE DAY

CPI came in Hotter than expected- Market selling off- stops getting hit - Energy seems to be holding up
Most of my positions have liquidated earlier today- Managed to lock in some small profits before they evaporated, and smaller losses -
Here in the final minutes before the Close- this is appearing to be a historically deep sell-off- I am down to 5 positions- and have stopped out or sold-
Going from all-in to now having over 50K in cash-
How sweet it seemed up until the CPI .....
Of the 5 positions I am holding, stops have been tightened to be sold - I added 59 CCJ back in in the IB - with a stop just under today's swing low $28.95
In the Van accounts- CCJ in the IRA, ICLN,DBA, with LNG gaining +3.55. Brutal dayExpecting more selling tomorrow. 4 days of upside wiped out today.
for the indexes:


The story of today's market reaction to the CPI- a sell-offf across all 11 broad sectors. If the CPI had come in below expectations, it would have supported the market consensus that the Fed will not be as aggressive- and the rally would have continued. While there was some upside captured if you entered early last week, look at the past 1 month relative performance-Everything negative.....


I'll admit I was optimistic that this rally would develop some strength this week-Todays CPI news and the market's reaction prompted me to react defensively.
Yesterday we had tightened LOLO's stops using the 2 hr chart as a guide- and all of her positions sold off
i BAILED OUT OF A LOT OF POSITIONS after the open-actually after 10 am in the Van account- most having opened with a gap down- but some still had some profits to be captured. Stops were in place in the IB positions- and tightened a few of them that eventually were hit....

For example, I initially had a wide stop on AAPL, as it moved higher I raised my stop and cancelled the stop and sold at Market for a small $2 gain versus sitting and waiting for it to hit my wider stop-
AAPL declined -$9.73 to Close @ $153.84 That would have been slightly above my initial stop-loss, but my expectations are that the markets do continue to find reasons to sell-off further, and the outgoing Tide will drag even good companies lower- such as AAPL and GOOG-
The consensus is that the market still has not correctly priced in the impact of higher rates, higher wages, and inflationand a high dollar on companies reporting in the next 2 quarters- profitability will come in lower- thus the present PE's will likely not be justified- and the markets will end up punishing those lower earnings by taking the price of the stocks lower.



While I'm not allowed to buy any inverse stocks in the Van accounts, I can in the IB-
So, shorting Tech -QID, SARK will be possible trades once the cash clears-

[sd]

Covid is kicking my butt- not making any trading decisions while feeling in the dumps!
However, I'm directing my "professional manager" to go into a money market account effective Friday-
He's unfortunately out for surgery, and won't return until next week-

I have contacted a money manager-Eqis that has held some of my money for 6 + years...and after all this time, I find their 1.70% fee has excceeded my net gains with a significant underperformance during the upside, but also significant drops to the downside- with the likelihood that the account will also drop significantly as the S&P likely slides further in the months ahead if the Fed tightens as expected. My general dissatisfaction with the performance results- Not even keeping up with nominal inflation As the chart illustrates- the Eqis position has previously exceeded the % decline compared to the SPY.



Here's the critical aspect of portfolio managers-They get a fee to manage how your assets are allocated, and they are the "Pros' with the educated staff to guide changes in the portfolio to move with market conditions- Their job is to also keep the investor -invested- and not be a market timer- because, if you miss being in the market the best 10 days- Blah,Blah,Blah- What if you held through thick and tin like the ideal no fuss investor and find you are not even keeping up with basic inflation, much less making any profits!

So, an account that is more conservatively focused, is designed to have lower returns and a corresponding lower RISK- Typically a mixed portfolio that includes some bond and stock fund is expected to have lower returns, and lower volatility.

As the chart illustrates- the Spy and the Eqis both saw a peak in 2017. The SOPY had gained +30% - and at that 2018 Low was still up +15%.
The Eqis account gained a conservative +12.44% , but then lost virtually all of the lesser gains.
Similarly, as the Spy rallies +61% above the initial entry into 2020, The Eqis account produces a +21% (1/3) upside- but then gives back the entire gains during the downtrurn, while Spy held a net positive of +9.9% at it's intraday low.
The 3rd period in the recovery of 2020-2021 saw the SPY accellerate to a 5 year gain of 145% , with a decline in June to be +88% from the start-aith a -17% YTD decline-
Comparatively, the Eqis account manages to have reached a high net gain Of+ $ 17,083- or aq 5 yr avg Of 6.2% compared to the Spy + 28%
While the S&P has declined 17% YTD. the Eqis account is down -16.8% Proportionately, it has a much reduced upside gain while taking it on the chin to the downside during market declines-

My personal belief, is that we have to respect that the /fed sees conquering inflation as it's primary mandate- even if that inflicts pain on the markets-
Our rally off the June lows was just wishful thinking- and it is to be expected that we will drop well below the June lows- Some Lofy market investors- believe we will see an additional -20% decline- as reduced earnings and reduced profits will cause the markets to get repriced much lower.

The Risk is much greater to a lower downside, than missing out an a market surge higher.

Up until 2022, we have been in an uptrending bullmarket- we now find ourselves in a market with a Hawkish Fed is focused on fighting inflation as it's Priority. There is no point in wishful thinking that the outcome will be quick and short term and that the F?ew will announce a new accomodative stance-
The Fed underestimated the inflation as transitory and should have reacted a year ago- they won't be quick to Err on taking a soft stance approach anytime soon.


The issue of inflation is that it destroys the value of one's money in a savings account- Inflation has been historically low, but averages about 2% a year- Until this past year- So, the net Purchasing power of the Eqis account needs to gain 1.75% to cover fees and expenses, and then to additionally gain + 2% for typical inflation- just to keep up with a break-even scenario- Simply where the account hasn't lost money-

Eqis account is now in cash 9-19-2022.
Scott Minerd expects another -20% downside by Mid October.

[sd]

9-19-2022- Raising Cash-

Sleeping 14 hours is ridiculous-but actually ate some food stuffs this afternoon- been getting by with just a small bit of breakfast, and a shake.
The Fever and aches are about gone- but we're both still lacking any energy- We haven't had as much as a sniffle for 2 years- thought we were pretty healthy and previously vaccinated and a booster a year ago- We'll continue to isolate the rest of this week, and verify with a final rapid test that we are clear by week's end. Looking forward to getting back to a sense of normal.
Effective today, the Eqis account is all in a money market fund- It will still lose money due to any fees charged @1.70% - but that will be a small expense to pay until I can roll it over into a new IRA account.
I have given this financial planner plently of time to "prove" the merits of the Eqis approach- and -I have had a number of issues with some of the investments- from an edgy ESG fund that lost 20%, a slow reaction to market situations- slow to only recently add energy- and a lack of transparency in the charts and performances of it's fund selections-
And- most importantly, it has an inability to retain any portion of it's gains during the other market pullbacks- unlike the S&P has done.
We have to be aware that we are entering a topping in the market cycle as outlined by Ray Dalio-
www.youtube.com/watch?v=PHe0bXAIuk0&t=71s


Many expect that 3rd qtr earnings are bid too high- Mike Wilson called the bear markets correctly this year...- earnings ests are still 20% too high...a factor of 2x PE too pricey according to historical norms- Scott Minerd- we will correct 20% into October....
Based on a Hawkish Fed policy determined to get inflation under control, we will see an extended period of harsher earnings reports- more misses on profitability, and lowereed future guidance.

That said, the 75 pt rate hike is now expected- Markets are coming to grips with it- and many of the market companies have already been priced in lower to meet future expectations- Some of what used to be the Ultra leadership-in select industry groups- Where the outperformer- NVDA in the Semsis- was allowed to be priced at a unreasonable PE .

Markets sustaining a bit of a late day rally-
Added GOOG here at the Close off it's yesterday low....

[sd]

5-12-22

oNE DAY TO GO TILL THE fED SPEAKS!

Expectation is now for a 75 pt rate hike- possibly a full 1.000

My Edelman adviser contacted me- back and today we discussed options on how to manage the 3 accounts he has under his control- @ roths, 1 IRA- all of which have substantial % losses as they weere initiated in fall of 2021- at a market peak-
There is plenty of selfcriticism for intentionally not focusing on this new financial partner so I didn't overreact- but the portfolio has seen losses across all positions- - Time to slow the losses-substantial as they seem today, will potentially be much larger months from now-
The Roths- go into cash- take the losses- start over fresh-
The IRA- sell 50% into cash- and see how the potential to put cash to work at a future discount- will transpire...
Because of my poor timiming in initiating the accounts right at a market peak, I bought at the HIGH - (over a 3 month period) - and elected not to obsess over the accounts as the market's declined- The extent of the losses was also in part due for the absolute failure of the bond holdings to gain any traction-
At this point, we are still above the June lows, but a retest is likely- and the longer term outlook for the economy will be seeing more downside than upside...

This week, FEDX warned about a global recession they think is starting, F warns about continued supply chain impacts - (and drops -12% today),

[sd]

9-21-2022
Markets slightly in the green ahead of the Fed- expectations of 75 bpts to be announced- and all eyes will be on the tone of the future guidance.
Rates are rising-
Future growth and earnings are expected to be taken down lower- - Is that now already priced in?

Looking for a possible bounce today on 2 small trades taken- GOOG hit a new low this week, made a upside try- I bought @ $103.93 and will use the $101.00 level as a stop-loss.
Similarly- NFLX announced the release of it's less expensive ad supported service, that is generally becoming viewed as a potential win-
Both are small positions, overshadowed by the Fed policy overhang- so I'm applying tight stops -

1 pm- markets in a holding pattern waiting on the Fed...
While I expect that the markets are willing to find some positives today, any rally should be an opportunity to reduce losses.
My personal belief is that the lower earnings and impact on the economy as we go into spring will see this late cycle decline grind lower -
I wish I had paid more attention to the new investment account and monitored it more frequently- Potentially locked in a large 20% loss in the Roths and similarly in the IRA by reducing the position size by 50% -
The only way that this course of action works into my favor, is that by raising a % in cash, that can be used in the future to repurchase when prices go even lower- If I had years to go and was working, staying the course and buying during these declines makes sense- but at my specific point in the retirement journey, this is a destabilizing way to start an "investment" ....

Will there be a muted positive reaction? The Spy chart -should prove interesting to watch on the fast 5 min time frame-
Bigger picture pre 2 pm

The 5 min chart @ 1:45 pm


Open to the downside Fed rates up .75% as anticipated.





I've taken short positions, QID
SDS, SSG - short the S&P and Semis-
fED POLICY STATEMENT APPEARS TO OUTLINE A MORE hAWKISH STANCE TO BE CONTINUED- Will get some color from the chairman later-
Initial reaction is clearly to the downside.



At the EOD- Markets elect to react on the downside -



Here's how the Day ended - 2 yr note above 4%!
Indexes closed on the Low side-with the $VIX @ $28.00....
My small long positions in goog and NFLX stopped out early this pm.
Short positions had some ups and downs, ended up in the green...

[sd]

9-22-22
Premarket futures are mixed, certainly not indicating a follow through to the downside as was yesterday's lower closes-
The question I have is will I be able to withstand the volatility of my taking short positions in the IB - Do I have conviction that the markets will continue to reprice lower in the face of the Fed's restrictive policy

2 yr note 4.33% !

Sentiment is at an extreme bearish reading- Typically a contrarian indicator- time to go bullish- but perhaps the majority are getting it right

We are still in the sweet spot of high employment, but we'll see the Fed policy will indeed contract the money supply, the jobs market will decline, unemployment is targeted to go much higher to stomp on inflation.

Owning "Fixed Income" is becoming a popular option mentioned by some recently- Look at the thrashing bonds have suffered this year! It is why the typical 60-40 portfolio has taken it on the chin.

The "short" positions are working







Jaimie Dimon- -Crypto is a Ponzi scheme" Does Bitcoin breakdown further from here? Will the bubble finally pop?

[sd]

9-23-22
Markets testing- heading for the June lows.
The few -10- large cap Tech Fang names have held the markets up, but they are under pressure-
Global declines ......
Goog, MSFT , are already below the June lows
Inverse funds come with their own limitations- particularly trying to hold for an extended period-
Direxion recently came out with a long/short AAPL ETF-as well as AMZN,GOOG,MSFT,TSLA
www.direxion.com/single-stock-leveraged-etfs
www.direxion.com/product/daily-aapl-bull-and-bear-leveraged-single-stock-etfs?keyword=appl%20etf&gclid=Cj0KCQjwsrWZBhC4ARIsAGGUJuoT9i-_a0ve8hcZaCx7iLBBvnJ3HO6bqUGgREKTtjxs-Uy_gxBQ2bIaAhKXEALw_wcB

Oil -premarket - is below 80- Energy- XLE has broken it's $75 support base -Dollar a headwind.


Will we bounce from this level? GS has lowered it's year end target....
Keeping in mind seasonality- typically the markets are weak in this period- accellerated by the impact of the Fed rate hikes-
The difference '-"this Time"- is that we are facing a persistant inflation, and a Fed that is aggressively defensive and not accomodative. The 'evidence' that the Fed will need to see is not simply a single data point- but a confirmation that the trend is for slowing inflation- and the Fed will not quickly lift it's restrictive rate - potentially will slow from 75 to 50 to 25 - with a final rate qabove 4%.

Unwilling to add to the short positions today as they have moved quite a bit, Gap open....$vix is pushing a recent high- (but not extended);
Hindsight being 20-20- the time to add to these short positions was on the initial break out-
However, my bias is bearish for the markets over the next several quarters, as the impact of the Fed policy changes have not been felt with real world results-

housing- Rate hikes have made most mortgages out of reach- Housing markets should see declines in price as demand falls-
Economic growth will be slowing- companies will preannounce lower expectations- Think FEDX-

Let's consider AAPL as a short candidate:It has held up extremely well- and is a huge % holding in most indexes-
Why will AAPL not see profit taking as losses accellerate in other positions?

The SSG position shorts semis- Time to cover as the SMH hits the june lows?


Initiated a short Energy- small position on today's Gap up in ERY. Energy has been a market leader - today's sell-off is in response to the global outlook of recesssion- However, this may be shortlived based on weather occurring in the Gulf next week- fear of drilling & refining impacts-
Will Add to this position on a limit order lower $43.25

Gap-away price moves as seen today -
Did take a partial on an AAPL short - AAPD $27.18

Going into the Close, sold QID,SDS,SSG - Locking in 3 days of gains - anticipating a bounce back higher for the market next week-
Bought the gap down in NOBL- in the Van account- It is $$$ below where I last sold it - Taking this as a potential over sold bounce trade for Monday-
Set a stop loss under today's swing low $81.40 Risking $1.00.

Sentiment is at a bearish level- $VIX had a big intra-afternoon spike higher- only to see a lower sub 30 print at the Close.

As difficult as this market is for those of us taught to have a bias for the long side- the 'investor Bias" has been getting hammered this year-
Of course, you hear the mantra about having a 5 year investment horizon, and it will all work out .... Not necessarily True- because change will occur- and many of those once ballyhooed promising new economy companies will go the way of Spacs- and be sold for pennies on the dollars.
Plus, simply look at where the hype had pushed some prices up to- and where today's reality is-
We're heading back to a point where valuations come under scrutiy- and earnings better justify that higher PE that some stocks are still commanding-

Prof Jeremy Siegel rants about how off base the Fed policy is- and how the Fed doesn't have a clue....
www.cnbc.com/video/2022/09/23/powells-decision-overlooks-monetary-and-financial-indicator-argues-wharton-prof-jeremy-siegel.html

With Energy taking such a big drop- including Oil and Nat Gas- The decline is based on fears of a global recession...
With hurricane season likely to deliver a scare to the Gulf this season, a potential trade to the long side for Oil production is worth considering in the weeks ahead.

[sd]

9-23-2022

A very tough week for the markets- The Fed gave it's confirmation that it will stay the hard line course-
We pulled investment monies into cash, and I reduced my one Edelman investment fund into 50% cash- as the fund has no ability to take counter trend or options protections.
Completely pulled monies out of another long term investment EQIS- It has the extroadinary ability to give back all profits during market declines- and - a 6 year review finds that the Eqis fees and managers fees exceeded all profits made during this period-
I'm fed up with the underperformance on the upside while sustaining the full brunt on the downside- I still haven't gotten a response from my account manager to my request last week - to put the account into cash- Fortunately, Eqis did so on my request- and so I was able to lock in some profits off the June bounce...

The tally this week is unimpressive- losses from 2 weeks earlier...
Vanguard saw losses consecutive weeks , and this week is holding all cash with the exception of a trade taken in NOBL this pm- and a few 1 share tracking positions. $45,782.00 total .

The IB account closed the week $17,826.00- up this week due to the short trades taken.

Combined: $63,608.00.
"SD's 2022 start:$18,078 + $43,742 = $61,820.00" -

Net Gain $1,788.00 or + 2.9% YTD-

Compared to the indexes:
Comparing to the 3 index averages-
Copy and pasting the 1st week's index performances:1 week index performance : DIA start 364.34 ; SPY 476.30 -; QQQ $399.05
DIA 364.34 - 295.86 = - 68.48 - 18.80% loss
SPY 476.30 - 367.95 = -108.35 = -22.75% loss
QQQ 399.05 - 275.51 = -123.54 = -31% loss.

9-23-22 Combined loss of 3 indexes = -72.55% = Average -24.18%

Relative performance difference - Index averages =- 24.18 + 2.9% positive gain = +27.08 % performance differential.



Note that the indexes are considered to be "All In" from the start of the year- Where my allocation varies throughout the year- sometimes- as presently almost 95% in cash in the Van accounts the past week + as Van only allows me to take long positions.
I also have taken a more tactical approach- not expecting to see any large upswing trends....and taking smaller net gains -and ideally smaller losses.
However, One needs to have a baseline for comparative results.
comparing against a passive investment portfolio of the 3 indexes at least gives a representation of how a potential passive investment portfolio may perform if continuously "LONG".

Being willing to sit aside in a large % in cash and not force trades is also a important choice.

Feeling 'normal" and not affected by a physical illness is

As today came to a Close, I made the decision to lock in gains on the short positions taken earlier in the week- Several extended gap higher moves seems a gift. Decision to not be greedy and hold over the weekend- That often does not see a higher move-
I also went ahead and took several new trades- Short energy, Short AAPL, and Long NOBL-
The Long Nobl trade is based on a potential that it is oversold- and this gap lower provides a potential rebound Monday- with a stop just below the low of today. It is a tactical trade- playing for an oversold bounce higher -but uses the low of today as a stop-loss for a relatively low risk Loss.

[sd]

reflecting on being restricted to the limitations of the investment firm's approach- and "trusting" one's advisers.
While I intentionally had diversified my personally managed accounts and had put a portion of some $$$ with a local firm some 6 years earlier--
The original account was started with a manager based in NYC- and after 6 months was transferred to an EQIS management approach.
It's worth considering the pros and cons of diversification- and so we followed the recommendations of the manager.
That 1st firm had advised that we divide a portion of the funds into a Fixed annuity, and a portion of the funds into an account that was actively managed using institutional funds-.
6 years later, Here we are today, with a significant market correction underway, and I elected to go into a money market account in the EQIS fund - at least partially locking in a pitifully small 6 year gain on that actively managed account- -Had i not done that a week+ ago, that account would now again be back to a negative for it's 6 year duration- The 3rd time in 6 years that the account gives up all of it's "gains" - in what appears to be a cycle of generating monthly fees for the account managers and simply riding the market wave up and down- I had left a voice mail message 9-15 with the manager's firm, and the account rep was not going to be available until the following Monday - and yet there was never any response the following week . I did this because i expected the Fed's action would prompt further selling in the markets- and the accoun't value had given back the majority of the gains made in 2021.
The Fixed annuity is a "safe" low return investment - and many consider it to be simply a high priced sales tool ofered by the account manager - because it ultimately gives back a very low return- albeit in exchange for a source of a guaranteed income after 10 years---and it also comes with a guarantee that it can never lose - or give back- what gains it manages to make- At a time like this- as we are heading into a possible recession- the annuity appears to be the better investment compared to the Eqis managed account- both in terms of Risk and Reward....
However, compare a low cost investment in the SPY......

Adding to this as I go- some connectivity issues...

While my account Rep says that their account is not benchmarked to any index- including the S&P 500- for comparative purposes one has to compare Reward versus Risk - The account reps disclaimer about not being compared to a benchmark seems to ring hollow when one looks at how the account has failed to hold onto gains during periods of market volatility.

Using the Account's historical performance, it can be seen that it closely tracks the same directional moves as the SPY- both to the upside and to the downside.
If the SPY was invested in Nov 2016, as the Eqis account started: $54,873.00

Spy went on to see account high gains of +30%, +61%, +145% - (net 5 year gains +28% avg.) All the highs were followed by drawdowns- but at no time did the SPY give up 100% of it's gains- as did the Eqis accounts.
Chart was taken 9-15- and Spy has since declined close to the June lows.
The net average Peak annual performance for the Eqis accounts was 6.2% while the SPY was +28%-
At the June lows, the SPY was still up +88% - Meaning that if = $$$ had been invested in SPY the account would be worth $103,161.00.
While the Eqis account was up an average of just 1.5% ....with less than a $5,000 gain...

So, Putting the Risk to Reward in perspective- The Eqis account clearly has less Reward for a greater performance Risk. You would expect just the opposite result- That the more conservative gains in the Eqis would result in retaining a larger % of the profits- but the performance chart proves otherwise-
And, once the 1.70% fees are deducted, the Eqis and account manager have made more in 6 years than the account has in net long term gains.



Without an alternative to holding only long positions, or a way to Hedge some of the gains, and with a market forecast that is less than optimisistic,
having less exposure seems prudent-
Particularly when bonds have been also getting trashed this year- What is Safe?

Ultimately, Going into cash locks in the losses- and is a losing strategy unless one can time putting that cash back to work at lower prices-
If one has decades to invest, there is futility in trying to time the market's highs and lows- but once one gets into the retirement red zone- one cannot recover from a major market decline if one pulls out at the bottom....
Presently, I believe we have more volatility to the downside in the weeks ahead-




It's never too late to expand one's knowledge base -
I'll be spending a lot more time this fall viewing TastyTrade and the many options videos and courses.
Tom Sossnof-Tasty Trade--
www.tastytrade.com/
beginner Options Mistakes:
www.youtube.com/watch?v=g_SYzdK6g0k

Not enough occurrences-
Inconsistencies in the approach-
Lack of market awareness

[sd]

Contrarian positions taken Friday-
Covered my short positions because of the weekend- and the gap move higher- expecting some reversion to the mean seeing a bit of a retracement-

I went long NOBL because it had a large gapdown, but a bit of a recovery the very last hour-as a potential contrarian bounce here...
Perhaps it gets an oversold pop here- Stop-loss is $81.40 This is in the Van account- remainder is in cash...
Van account is very restrictive- will not allow inverse or short ETFs-

ERY- Energy Bear had a large gap higher- I got in late with a small position- Energy has been getting sold off based on global recession fears.
I have a limit to add @ $43.25 - A hurricane in the Gulf may see Energy spike on disruption fears...

Decided I will short AAPL using AAPD-- AAPL HAS BEEN KEEPING the indexes afloat- If it breaks lower, plenty of downside Risk.

The ultimate question is when will the markets think valuations are indeed a "value".

Will Bonds turn higher 1st as some have suggested? How about a drop in the dollar ? UUP pushing out to a new recent high! Time to stall?



Are SDS , QID, SSG, SARK ready to pullback here? sUBSTANTIAL MOVES THE PAST 2 WEEKS!



fROM A Fundamental market point- Tech is under pressure- Global earnings are getting hurt by the high dollar, plus the slowing economies and potential global recession.
PSQ is a 1x short - QQQ's looked to try to make a move up at the Close.
The housing market -with high rates and overpriced houses has been seeing a slowing- DRV is a 3x inverse- pretty extended. But the housing markets are overpriced, rates are too high, and due to correct more.

SPY testing the june Lows- My Bias is that it will break lower in the next weeks- Quite an important psychological point for the markets- but i think we'll see reduced earnings, lowered expectations - similar to the grim forecast by Fedx that a world wide recession is likely. Large cap stocks with international exposure for their products are fighting the higher dollar cost.....

Present moves seem extended- let's see what this week the markets will key in on as important..

[sd]

9-26-2022 Futures testing the June Lows!
2 yr 4.293 10 yr 3.777

Premarket discussion Prof Siegel - "Fed owes the American public an Apology- 1st for not recognizing inflation was Not transitory- and 2nd- the Present austere rate policy designed to crush employment as a cure is mistaken- Fed is overdoing it to the detriment of a market able to make a soft landing...."

Check out the once considered "Safety " bond component in a portfolio-
The IGOV - international bonds- Seeinmg a loss of -26.5% YTD!


TLT- 20 yr US bonds- No Safety there either!


Who would have thought that bonds could drop More than the S&P 500? Doesn't this turn the thinking around the 60-40 portfolio as terribly flawed?
This is a 1 year chart - SPY is the Red line - Bonds are the Blue and Green lines!



Looking back 5 years-



Dan Niles think we may get a oversold bounce this week- but expects we see S&P @ 3,000 later this year-

ERY short- initially started higher , came back and hit my stop for small pennies @ B.E. $48.63 vs $48.58- but it reversed higher...
AAPD also stops out 10:15 am for a net loss- QQQ's rallying a bit. $26.53 Cost $27.17- could have tightened the stop earlier....seeing the direction the markets were heading-
Good to have covered the shorts Friday afternoon!
Mid morning- Nas getting some upside- SPY not getting any headway- inside day -
$vix coming in after a jump to $32


NOBL trade folded and went lower- stopped out, Got that wrong-

Mid day- Market is rolling over- weakening.
Going Short REK,SDS,SSG - all seem extended here- but with the markets weakening, not much choice other than sit on cash- Relatively modest position size. 50 shares each.


EOD- SPY makes a new lower Close for 2022!
Dollar up- rates up- stocks go lower....

[sd]

Watch the dollar drop to see Energy and metals rally- We have to be close to a top in the UUP! Energy would seem to be the one sector that- even if we have a global recession- would be worth starting a position in - once the dollar blinks and drops a bit....Oil at $70?

What about an unthinkable Black Swan event? What if Putin uses a tactical nuclear bomb against Ukraine? ThaT IS a real consideration !
That would certainly have a profound effect on Europe! EPV....
etfdb.com/etf-education/how-to-go-short-europe-with-etfs/

[sd]

9-27-2022

Futures will open in the Green! My extended bearish entries yesterday will becoming losing trades this am....
The issue of using any inverse fund is the daily rebalancing that is required-

Cathy Wood on CNBC this am- "we are already in recession" - inflation is declining...


Oil is higher today- hurricane in the Gulf affecting Florida-

Stops execute as expected- Losses on the 3 inverse funds due to today's positive open...

It's Risk on with a lot of green across the boards..... Earnings reports in a couple of weeks- PE ratios are now below the historic average levels-for many stocks-
When's the last time we looked a recession in the eye though? Tech is still priced highly.
i think the upcoming earnings and guidance will obviously be critical - If companies project a recession affecting their earnings, prices likely go lower- and we extend this market pullback to the more severe -30% levels. Typically, markets rally following mid term elections-


consumer sentiment- University of michigan- Sentiment is at an all-time low----
consumer confidence index is higher- Home data was up due to an August drop in rates to 5%.

EOD- Market gains slipped away, My short trades got whipsawed as they initially saw weakness, stops got hit...

[sd]

9-28-2022 Asia lower, US futures lower premarket-
Bank of England to start Buying Bonds....Big deal! Historic step by the Bank of England....
Futures moving - will the Fed blink? Not likely - Futures turning green
The obvious was pointed out yesterday- Why would anyone buy a dividend fund- Like NOBL with a 2% payout when short term bonds offer 4%!!!

AAPL will be reducing it's orders for the I-phone 14... AAPL premarket dropping-

Energy- XLE up -premarket-

The relative sector performance graph from finviz.com/groups.ashx is well worth following-
Energy's long term outperformance is in decline-




The AAPL story- reducing production-reduced demand - has to be a negative for the broad Markets- and likely the chip sector- I was unable to hold my AAPL short the other day- volatility took me out- Unwilling to Risk that extent of a market swinging against my position- Will consider viewing the SSG- chip short- today...

AAPL - the 1st 20 minutes:


The AAPD- shorts AAPL- breaking out to a new high as AAPL gaps down-



Buying Value in the Van- VTV, and energy XLE. Also XOP....
nordstrom pipeline bombed.

XOP,FCG,EOG, LNG

Not allowed to own ET in an IRA account.
Buying Healthcare XLV-


Wondering about the other potential energy plays- RIO, CCJ, URA -uranium

ARCH, BTU coal-

7 commodity stocks mentioned in this recent article

finance.yahoo.com/news/7-best-commodity-stocks-rising-172414814.html

BANK OF eNGLAND'S ACTIONS -prompted today's rally- So, I also took several positions- SCHD vs NOBL- also a partial EEM position looking for an oversold bounce-
Energy positions were the biggest winners today.
Oddly enough AAPL stayed lower today, while the remainder of the stocks in the Dow went higher-

Will take today's market wide upmove as an oversold rally - and not based on any real accurate information- certainly not any change in the Fed policy-
So,
Short term moves are best trailed closely- No reason to think we have made a bottom- just getting a bounce here...
At the EOD, gains in all positions except for ARCH - bought late in the day. Big moves in the energy spaces-
Took a small spec FEMA- play on stocks that benefit from business due to disasters?
finance.yahoo.com/news/procuream-launches-first-ever-global-130000517.html

Now, This was a Good Day for the Markets!

[sd]

9-29-22

Lots of red preopen.
Really thought we'd see a bit of a rally follow through today- can't trust the open-
In the IB holding all energy related stocks- without stops - will see if we can turn @ 10 am

9:45 -plenty of Red!




Talk about whipsaw price action!
Jobless report came in low- Undoubtedly the Fed has a bullseye on crushing jobs- Their mindset is that if we can throw people out of work, they won't be spending and consuming, and inflation- demand- will fall- Consumer sentiment is already negative- and with the Fed targeting jobs as a way to fight inflation seems counter productive-
high rates should crush the real estate market's elidgible buyers- and real estate pricing should come down.... That's a big contributor to inflation!
Going back into REK- shorts real estate- small entry position here $21.71. stop $20.90

Sold off XOP at Breakeven- as gains evaporated- Had a net +$4 gain yesterday- whoosh lower today!
AAPL downgraded-will try the AAPD short ...

Bit of a recovery in the energy positions mid morning-
On today's flash return to a bearish market- shorting tech with QID....
Will see how these short positions behave relative to the actual stocks-
For example -QID as the Ultra 2x short of large cap tech-
The relative move appears to track the qqq's closely- based on the 2x multiplier-
Inverse funds get rebalanced daily, so this chart does not seem to indicate the slippage in returns one should expect-
This is a 3 week performance chart....QID is the Red, QQQ's the Blue-


aS i consider today's market action-Early afternoon, I obviously got pulled in yesterday to the upside- in both the Van accounts and in the IB-
Today's volatile move to the downside, had initially put me in losing territory-But at least in the IB, the energy positions EOG, FCG,LNG are seeing some green after being in the Red earlier.


EOD- Let's get Friday here- A 1 day rally this week sucked me in - Bought some Value VTV and SCHD in the Van as we rallied- thinking we'd get a couple of day's upside-
TSLA has a show after hours tomorrow-
I'm going to try for a short TSLA position with a limit order $40.35 for TSLQ in the IB. TSLQ is a 1x inverse- so it ideally moves directionally equally. Today's low was $39.97 with a higher Close-gaining +6.61% TSLA dropped -6.81%
But volatility can work in both directions- Potentially we see a drop on Friday's open - with Tsla hype making it see a move higher at the open-
TSLA- while the #1 market leader in EV is priced at 96x , While F is 4x, GM 6.32zx-
Besides the question of meeting demand-with the supply chain constraints, comes the other competition on the world global markets- and how about the shutdown that is ongoing in China? And - China has many of it's own homegrown mfgs....
And -Take Carmax reporting today-
Missing estimaTES across the board- and citing a changing consumer mindset....
So, TSLA may very well be similar to AAPL- A favorite that is widely held- until the facts suggest that All is Not as optimistic as the PE suggests.


These stock inverse funds are relatively new- are relatively expensive- and may not be worth holding over the long term depending on how they are rebalanced- Certainly the leveraged inverse are problematic over time- But, they can provide a vehicle that allows an investor to take a stand contrary to a long position.