All posts by T3 Trader
What’s Happening: Anti-Trump?
Over the past couple of days, we’ve seen the big Trump trades start to reverse themselves a bit, with bonds rallying, financials falling, biotech dropping, and gold stabilizing. Bonds are up again today ahead of Yellen’s testimony, and odds are she’ll be asked about Donald Trump’s proposed economic policies. But since the Fed strives to appear apolitical, I doubt she’ll give anything concrete. Already this week, many Fed officials have been asked about Trump and many have been evasive, though there’s a growing consensus that Trump’s spending plans could give the Fed room to raise rates. The CBOE’s FedWatch Tool shows that traders are pricing in a 91% chance of a December rate hike. Oil is rallying on Saudi optimism regarding an OPEC deal. Yesterday, Russia offered similar vibes. OPEC reached a preliminary agreement back in September at the meeting in Algiers, but didn’t provide any details. Maybe it’s for real this time, but I wouldn’t count on anything until there’s an official announcement. Throughout 2016, we’ve seen a lot of false rumors and conflicting headlines, so try not to get too caught up in the chatter. Wal-Mart (WMT) is getting spanked on a same-store-sales miss, though Best Buy (BBY) is popping hard on a beat. Overall, markets feel compressed, which is a familiar theme this year. We get some exciting news (election, Brexit, etc.) following by a long string of back-and-forth nothingness as traders wait for something to happen. The VIX is at 13 and change, but 20-day realized volatility on SPX is at 10.6. So unless we get big moves soon, the VIX could easily drop back under 12.
Continue Reading -->Morning Call Express: Stalling or Digesting?
In today’s Morning Call Express, Scott Redler reviews markets around the World as well as the U.S. Markets. The question to now answer is; are we seeing a digestion or stall? Scott looks at various sectors as well, including USO and XLE.
Continue Reading -->Bears Scream After the Donald Trump Bump
The ISE Sentiment Index is one of my favorite sentiment measures. It is a call-put ratio (as opposed to a put-call ratio) that uses opening long customer options transactions to judge sentiment. It excludes trades like short puts (which are bullish positions) and trades from market makers and firms, which to me makes it more useful than straight put-call ratios. As of yesterday’s close, the ISE’s 10 day moving average was just 67. That is an all-time low, and it’s likely to go even lower tomorrow. As of 10:30 a.m. ET, the ISE was at just 44. If it closes at 44, the 10-day moving average will be down to 66. Over time, the ISE has fallen as equity options have increased in popularity as a hedging instrument, even for credit investors looking for protection in illiquid assets like high-yield bonds. But still, this is a pretty depressed reading. It’s lower than readings seen at the August 24, 2015 mini-crash. And prior to this 10-day stretch, the ISE averaged 87 this year. And the 10-day moving average bottomed at 76 during the February mess. In my experience, when you have technically stretched markets and bearish sentiment, we tend to see a stalemate. That said, other sentiment indicators I follow like the CNN Fear/Greed Index and AAII Sentiment paint a slightly different picture. But after the 2-day Trump bump, it’s safe to say fear is setting in again. Check out this chart of the S&P 500 against the ISE Sentiment Index: As you can see, when the ISE gets to these depressed levels, the market tends to bounce. However, we’re in uncharted waters from a political standpoint, and it still feels like we’re in an “anything goes” environment.
Continue Reading -->Morning Call Express: America Speaks
In today’s Morning Call Express, Scott Redler talks about the impact of Donald Trump being elected the next President of the United States of America. Scott talks about where the markets were at the lowest point, overnight, and where it is looking to open. He helps put things in perspective and provides a roadmap to navigate today’s open. Scott also discusses the reaction in biotech land and gold.
Continue Reading -->Morning Call Express: Pre-election SPX Re-test
In today’s Morning Call Express, Scott Redler discusses the news over the weekend, the day before election day, and what to be looking for as far as support and resistance levels. He also talks about some high beta tech names and gives you a plan for today.
Continue Reading -->Morning Call Express: The Pattern of a Potential Bull Trap
In today’s Morning Call Express, Jeff Cooper talks about the potential of a bull trap in the SPX and wonders if an Orange Swan event is on the table. He also talks about the key levels to be watching for clues to a significant correction. Jeff also talks about several cycles that he has been cautioning his reader about.
Continue Reading -->Morning Call Express: Pre-election Oversold Bounce?
In today’s Morning Call Express, Scott Redler talks about what has happen overseas and how that impacts the U.S. Markets. He also discusses the Facebook (FB) earnings and how it is acting pre-market. Scott also looks at other high beta tech name along with GLD.
Continue Reading -->Morning Call Express: Connecting The Election Correction Technically
In today’s Morning Call Express, Scott Redler discusses the Fed day today and the likelihood that it is a non-event as the U.S. Presidential Election has taken center stage. He reviews the action in the SPX given the sell-off yesterday and updates the new levels of support and resistance. Scott also looks at the bounce that took place in the Biotech (IBB) and a couple high beta tech names.
Continue Reading -->Morning Call Express: Ranges and Noise
In today’s Morning Call Express, Scott Redler puts all this sideways action into perspective by looking at the longer term SPX chart. He then takes a look into the recent daily action, which has been choppy, to say the least. Scott notes that it is likely to stay this way until after the election. He also looks at some recent earnings names as well as FB which will report tomorrow.
Continue Reading -->Morning Call Express: Sluggish With a Constructive Feel
In today’s Morning Call Express, Scott Redler updates the key levels of support and resistance on the SPX. He also talks about some earnings names that have reported as well as other names that are looking constructive.
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