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Update 118: Stock Market-Our Accurate Forecast Review-Read More

November 5 2020 Option Professor Opinions & Observations

Hello Everybody….We feel during 2020 a very volatile period in the markets. ….we have DELIVERED VALUE ADDED information to our readers….so this week we’re going to provide to you what we have been saying since March and what our views are right now on Stocks Bonds US Dollar/International Markets Crude oil-Nat Gas Gold-Silver Copper and a few other markets. This week we have seen the REFLATION trade come and go…we have seen the blue wave come and go big stimulus-higher capital gain taxes come and go. As of this writing; the expecting is a blue White House and a split Congress with a Red Senate & Blue House. OUR POSITION that we told you last week was EXACTLY a SNAP rally this week due to Tech having been sold off & the VIX at 40 going back into the high 20’s and BEARISH positions (retail investors on the sideline/pros hedged)…..the VOLUME tells you a REVERSAL of those positions has occurred. Exceptional Uncertainty remains (stimulus-virus-policies-huge unemployment) and who knows if there is much more volume in the short run. The BIG IF is IF the highs on SPX DJTA QQQ NYA are NOT EXCEEDED and the Narrative Changes…..could we see BETTER PRICES in Late Nov thru mid Dec BEFORE a Santa Claus & Jan Effect Rally?? Sometimes a stampede In OR Out of stocks is just that and things tend to settle down. BULL CASE ….US Dollar dropped helping Stocks Gold Euro BUT it did not take out the 90-92 area and the Yen tanked while the Euro is still UNDER 120 with a second lockdown/recession talk & a Dec 10 ECB meeting. The Fed must keep rates low (T.I.N.A is back in vogue) BUT remember the last time GDP numbers were great (Q3) was AFTER the CARES money was spread all over town (who knows WHEN or HOW much will be distributed). So yeah…we are in a bull market….but totally out of the woods yet?? Value (banks-industrials-materials-epicenter) still struggling to break out- bounce. Valuations don’t get cheaper when prices go thru the moon. The FED says loan demand from small business (main street) stinks & they need FISCAL to chime in (with contested election-split Congress when’s that coming?). Somebody is fading (selling) into this buying stampede and we believe in the next few weeks we will see who is the smart money We don’t want to fight the tape but we are at the HIGH END of the Trading Range so waiting to see how the dust settles sounds reasonable—a return to a HIGHER VIX. NOW let’s get into the review of our opinions since March…toot our horn:):):

You can learn what ETF’s we use to diversify @ optionprofessor.com

Stock Market

We told our readers that MANY INDICATORS told us the SP3400 area was a top in Feb (AD Line/RSI divergences ect) and said a move toward 3000 was on the table so look into hedging (collars/puts/covered trims replacement trades)…..the break of 3000 and VIX above 30 put meltdown on the table (always does) and the collapse was upon us. Where would we stop? WE measured the move from the 2008 crash low at SP 666 to the Feb highs at SP 3393 and got 2727 points multiplied by 38.2 = 1042 points and by 50%= 1364 points or the pullback low range could between SP 2351 and 2029. It ended up being 2174 smack in the middle of our estimates. Once we heard the Fed was back in the game…..we immediately turned to tech& large cap growth & Consumer discretionary (VCR MGK VGT) which began their upward trend that remains today…follow our moving averages and the trends remain. We have rotated some of that into VALUE (MGV VYM VIS VAW VOOV VOE VBR) to capture low valuations/high dividends and the eventual hopeful cyclical-reopening coming in 2021 with therapeutics & a vaccine. We also cited epicenter stocks in travel/leisure gaming pot stocks bitcoin ect as LT deals.

Want to know our positioning opinions now?..optionprofessor.com

Bond Market

After we aw the INCREASE in yields in late 2018 and the 25% DROP in stocks we felt the days of higher yields was OVER…basis TLT which we use as a proxy for Treasuries the bottom was 110 areas. The economy could not endure higher rates and we RALLIED thru 2019 until late 2019 when we pulled back from TLT 150 area to 135 area and yields rose again (adding to our sell on S&P false rally in Q1). With the stock market collapse fueled by the Covid lockdown…we saw prices soar to TLT 180 are yields collapse to historic LOWS. It is our view that the COMMON THEME in 1981-82 when YIELDS ROSE to RECORD highs & this years RECORD LOWS is that the narrative was the yields would NEVER DROP back then and the yields will NEVER RISE which is the narrative today. We believe as WRONG as popular opinion was then about yields not dropping is about as WRONG as the opinion is today of yields not rising. The Fed wants inflation and the government wants growth and MONEY VELOCITY & LOAN DEMAND is best helped with a STEEPENING YIELD CURVE which has already begun.

We follow fixed income—corp/tax frees/international-optionprofessor.com

US Dollar/International Markets

We had the US Dollar pegged in a basic 14 point window (104-88) for the last 3 years…..when it slipped under 102-100 we got a sell signal and an acceleration into 90-92 where it bottomed in August (got us bullish Stocks Gold-Silver Euro from Q2 this year)…..but in August the turn in the Dollar and parabolic moves in the aforementioned got us committed to a consolidation/decline for those markets and a rebound rally in the Dollar EXACTLY what we have seen. If the short term SAFETY TRADE is to be Bonds & US Dollar then the other markets may be range bound a bit longer. International Markets such as EM (big up move)Japan China Europe have bright futures if the Dollar resumes it’s down move by taking out 92-90.

We have plays for the Dollar/International Markets-optionprofessor.com

Crude Oil Natural Gas

We saw the break UNDER 65 in 2019 as the signal the party was OVER in Oil and the move UNDER 45 the short term killer blow. Now we have seen fracking and other rigs unprofitable and big consolidation in the industry. The wide trading range of 45-25 now exists but we are NOT abandoning this sector as we believe it is getting sold out and the survivors will endure. Next year we anticipate DEMAND returning against smaller supplies and that bodes well for 40-55 crude longer term and the likes of VLE VDE longer term with juicy yields in the interim….so unloved so much potential. Nat Gas supplies are wild ergo so are the prices longer term like LNG above 52

Energy questions optionprofessor.com

Gold Silver Copper Bitcoin

Here’s your inflation hedges and quite a year they have had. Let’s start with Gold…we saw the breakout ABOVE $1400 as the green light and a grossly OVERBOUGHT $2100 (far over Moving Averages) so we then suggested hedging/trimming on GDX GDXJ ect….we thought the trading range would be wide 2100-1800 which so far is EXACTLY what happened….same with Silver…a break ABOVE 19-21 was the green light grossly OVERBOUGHT at $30 so our opinion has been a wide 30-22 trading range EXACTLY what has occurred & same with PAAS SIL SILJ ect……Copper is a different story (FCX huge winner for us) in that tighter supplies (Covid) and housing/China Demand blew out the resistance at 2.50 and sent prices toward 3.25…..still 25% ABOVE the 200 day and if we don’t get infrastructure and the housing craze subsides-correction possible. Bitcoin is played thru GBTC and it has done well–we go digital–big names in SQ PYPL more to follow including an entire generation who are digital. We are going in this direction..no doubt.

What are we focused on next? optionprofessor.com

Soybeans-Sugar-Coffee

We told you Soybeans were a deal in the $8 range as we expected China to come in big (Q3 buys +63%) so we today made 52 week highs at 11.12+… very happy with that and monitor it closely ass we thought 10-12 may be the first level after break above 10. We told you Sugar above the 12.30’s CONVERGING 50-200 M/A’s was a go and we have traded well in the 14’s but need 16+ to get into gravy land. Coffee was a great market for us EARLY as we saw sub 100 a steal and the move to 137 excessive…supplies are plentiful which has made rallies temporary lately but 95-105 area so far is support.

Lots to Learn email us to Learn More [email protected]

REMEMBER There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage form/broker/advisor to determine your own suitability. Past performance is not necessarily indicative of future results . Use Risk Capital Only.

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Update 117: Stock Market-Red October-Falling Knife-Read More..

October 31 2020 Option Professor Opinions & Observations

Happy Halloween & A Scary Week It Was!!…..Well our readers are well aware of what this Sept Oct Nov time frame could bring because we told them in AUGUST to get prepared….HIGHS in SEPT SP 3580 & Nasdaq 12,400 followed by sharp drops…followed in OCT with FAILED rally at SP 3550 & Nasdaq 12,200 followed by this drop….we told you of ways to PROTECT your portfolios using among other things COLLARS (sell calls/buy puts)… plus MARRIED PUTS (rights to SELL) and REPLACEMENT TRADES (limited risk calls/call spreads). We now have no STIMULUS–Q4 GDP CUTS–SELLS on great earnings reports (we told you about BUY Rumor-SELL Fact) & Spiking COVID Cases (500k RECORD last week). We see the 60-40 portfolios aren’t helping as BONDS fell with STOCKS last week–double whammy. This may change if STOCKS go down further as the DOLLAR & BONDS may be a safety trade temporarily if investors DITCH Stocks & Gold in November-Dec. Lots of people on UNEMPLOYMENT & Claims numbers while improving are PERSISTENTLY high. More layoffs coming at Raytheon-Schwab ect & wages-benefits are sluggish. Households overall are said to be in good shape but renters and homeowners in the millions say in NOV they are uncertain about making their payments. The yield curve is steepening and tax rates on capital gains may rise…both NOT welcome news to HIGH valuation tech & Mega cap growth….and pulled forward demand is a risk into year end. AMZN said their shipping costs EXCEEDED revenue growth and less user growth was problematic to others. Without BUYBACKS some stocks like AAPL have a harder time as I-phone sales haven’t been great and China seems to be waiting (-29%) to see the value of I-12. With EARNINGS on SP at $1.60 a 20X valuation is 3250 (this weeks lows)…..should expectations SLIP or Valuations CONTRACT….this is how the other shoe drops. THIS WEEK the FED & Powell will talk & we have a JOBS Report.. maybe see a snap rally???? The BIGGER QUESTION is WHERE DO WE GO FROM HERE??….READERS know OUR OPINION and it remains the same since AUGUST…..the SEPT OCT NOV time frame (maybe a little into Dec on some markets) you see a LARGE DECLINE in STOCKS-GOLD ect to CORRECT the OVERBOUGHT conditions (LT Moving Averages-REVERSION). No Stimulus-Virus Spikes- Q4 Slower GDP & the Election will be blamed. Many talk of the SIDELINE money but we have spoke of the OVERCROWDED trades and VALUATIONS that are ABUNDANT. We don’t know if SP 3200 will hold thru the year end…we have our DOUBTS but we DON’T FIGHT THE TAPE nor THE FED (but their job of stabilizing DEBT markets is mature). Let’s face it most investors are in STOCKS & GOLD and are HOPEFUL but we feel you respecting the POTENTIAL of a DEEPER Q4 DECLINE closer to their 200 day moving averages makes sense which is where the BARGAINS may BEGIN for 2021 as STOCKS-GOLD-VALUE-OIL may APPRECIATE handsomely from STIMULUS-VACCINES/THERAPEUTICS-WEAKER DOLLAR-STEEPENING YIELD CURVE-INFLATION & T.I.N.A ect. & a much more pervasive re-opening of WORLDWIDE economies. We SHOULD see a SUBSTANTIAL RALLY but FROM WHAT LEVEL?? RIGHT NOW it looks like TWO THINGS we suggested HEDGES & DRY POWDER are still Working.

Do you want to discuss your questions? email [email protected]

Stock Market

It was a BUY the Rumor SELL the Fact for the most part last week which is EXACTLY what we suggested last week in the Update. Investors got real comfortable at HIGH ALTITUDES and forgot where the long term moving averages are in most markets (AMD didn’t f orget as they and others are using found money (their stock prices) to finance acquisitions (never happens at the lows). News abounds as the CDC gave an OK to cruise ships (CCL) which also helped some airlines. Fisker came out.. got a poo and then fade. Pinterest went from 50 to 70 then faded to 60 while the double TOP in biotech (IBB at 145) got more proof as we saw a fade and GILD lost steam. As we told you…higher yields is not helpful to the red hot housing market LEN ITB ect so they have seen a fade lately. Banks also seem to like the steepening yield curve as JPM/KRE popped but need more price proof. CAT turned around nicely but after it fills the gap around 160..will it have legs. YUM & GE are trying to turn while China stocks (BABA KWEB) pulled back & some wonder if Europe & the USA are seeing a second wave–China next? This week we’ll see if SBUX MCD CMG CRM ZM ($130 bucks off highs) ect. can regain footing. After such a big drop we could see a snap back rally as the VIX is near 40 suggesting almost 3% volatility…..we told you the VIX inability to get UNDER 20-25 for any length of time was a WARNING signal; as when we were at SP 3400 highs early this year.. the was VIX near 14-more normal. The next 2 weeks-SP 3400 & 3475 GAPS above…filled?? Our position is that not enough PRICE PROOF so premature for Table-Slamming

We followed ETF’s as well for Sector Growth? go to optionprofesssor.com

Bond Market

Yields rose (Prices Fell) and Stocks Fell…not exactly what your friendly financial planner said would happen….as we told you MONTHS ago..we may have seen a historic turn in Yields in March-April as investors see the joke rate they earn and the risk of duration in a printing press world. Well we continued to see an exodus this week but we caution in the short term a further decline in stocks by year end could see a safety trade send money into bonds temporarily (yields back off)…..but sometime in 2021 we expect deficits/stimulus-reopening/supply demand imbalances/dollar weakness to be problematic for duration as the yield curve steepens further. TLT had a blow off top at 180 and fell to 155 area…a pop out of this neighborhood is not off the table. We favor Short Term IG corporate–LMT Munis for now. The risk of EM debt reared its ugly head but maybe a slight bounce coming.

We follow Fixed Income-Got Questions? email [email protected]

US Dollar-International Markets

European markets had a tough month across the board as their Leaders consider more strict curbs on activity to quell the spike-our leaders seem oblivious to our 500K spike last week (of course they have doctors with REMDESIVIR on speed dial & the poor souls in attendance use Nyquil). Lagarde says Dec 10 they will reassess ECB policy but admit the data is eroding. China’s % of global GDP is soaring as they march on despite USA rhetoric & ANT raises something like $2.5 Trillion and smash all records. Japan which is on our Radar List had factory production up the most since 1973….also the last time we dunked a basketball…in other words a long time & the labor market is showing signs of bottoming out….The US Dollar is still holdin the 90-92 level and if we see a further decline in stocks by year end a temporary rally as a safe have still on the table-bad for Gold & Euro. China is trying to get more transparent on the yuan while the Yen & Can $ still unable to break downtrends…Auusie $ still languishing but holding 68-70.

Got FX-International Stock Questions? email [email protected]

Crude Oil Natural Gas

More trouble for oil this week as DEMAND abates with Virus spike & stockpiles increase-a double whammy short term. XOM is cutting jobs in an attempt to preserve the dividend (which keeps people holding on). We will maintain our view that $30 area will be aided next year by more increased DEMAND (re-opening/jet fuel) and going into the 40-55 area in 2021 could occur if no external forces hijack the market (OPEC-Virus). CVX KMI SLB COP XLE are decent places to look after lows established-nice yields too. Natural Gas spiked to 3.50 (we got bullish at breakout point of 2.00) but Caveat Emptor as this is a thin volatile beast and LNG still can’t return to 52 and FCG hasn’t broke above $7 despite the fireworks in the underlying???

Gold Silver Copper Bitcoin

These are the hedges against INFLATION & a WEAKER DOLLAR (Copper of course has tight supplies & an Infrastructure-housing play). Well the Dollar stopped being weak since AUGUST which coincided EXACTLY with OUR CALL that Stocks would peak Gold peaked at $2100 & Silver peaked at $30 bucks in the SHORT TERM. Early this year & frankly for a while before we liked GDX GDXJ SIL SILJ & many more but the BLOW OFF short term move and the PANIC to buy had us lean to pullback & correction…not any price evidence yet to change our view…in fact a Gold Council this week said Q3 Gold stats showed DEMAND declining as high prices hurt jewelry sales BUT investor DEMAND was up & coin & bar DEMAND rose 49% (good salesman) BUT this hit us..Central Banks were NET SELLERS in the quarter…..we look for a better potential prices later this year for traders and an up move 2021 FCX has been our call for Copper but warned that short term overbought and 13-14 would be monitored for add ons (we entered in single digits) Bitcoin remains a long term potential-GBTC the vehicle we use if above 10.

Soybeans Sugar Coffee

We told you last week that our bull market in Soybeans (we got positive in the $8 area) could see a pullback as it would not be immune from an across the board hit in financial markets and indeed we shave 30 cents off last weeks highs-50-200 day MA’s are at about 10 & 9 so stay tuned…..Sugar prices (which we told you turned positive at 12.30) got hit this week for the first time in 5 weeks (nice run) but failed to get above 16–breakout point. Coffee we told you is one of the few commodities with a surplus (that is one of the reason commodities have a bright future potentially VCMDX)..still holding 100-15 but above 108-115 needed to get the flow more northenly.

REMEMBER There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage firm/broker/advisor to determine your own suitability. Past performance is not necessarily indicative of future results. Use Risk Capital Only.

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Update 116: Stock Market-Can You Trust It-Big Week Ahead-Read-On

October 23 2020 Option Professor Inc. Opinions & Observations

Welcome Back Everybody!…..There is a lot going on ( prez-debates-earnings-stimulus talks- virus uptick) but in truth the SP has been in about a 100 point range for the last 2 weeks with the VIX trading between 25 & 30. Something seems to be brewing and we’re here to tell what we see. First off…Claims came out down from last week BUT we are still at historic levels on the unemployment rate and ongoing unemployed (some just ran out of time on their benefits). Cash holdings are 5X normal at 12% of GDP globally & 17% of GDP in the USA with savings rates near 20% in some places. The winds of change are blowing in the YIELDS market (something we told you about for months). This STEEPENING if the yield curve has a number of ramifications including helping FINANCIALS-CYCLICALS which have been on a tear BUT it could dampen the extended TECH & other high valuation stocks that could be REVALUED in the weeks & months to come. Also future TAX RATES for capital gains (highest since 1922) may affect tech and mega cap growth as we see COMPRESSION of valuations-profits-margins and causes a long awaited REVERSION to the mean as anyone who has looked at long term charts & longer term MOVING AVERAGES has to see they are extended. Yields rising could cool off the red hot HOMEBUILDERS as we see a 10% drop off the highs in ITB LEN PHM ect ( a very crowded trade). So OUR VIEW NOW is the market remains BULLISH however a risk in the next 2-8 weeks is that a correction could occur of 5-10%+ and may start this week if when earnings come out on FB MSFT AAPL AMZN & others this week and we see a buy the rumor sell the fact outcome (like NFLX-Fastly). WATCH OUT if the SP 3400-3350 breaks along with the RSI under 50 & a VIX north of 30-35 as signals that a correction is unfolding. LONGER TERM.. we see a very ROBUST Q1 for a number of reasons including STIMULUS (remember April- May stampede after last stimulus) plus the earnings comparisons will be easy and blow out earnings expectations (beat 2019) as we ride the WAVE of sideline money looking for YIELD & GROWTH at reasonable VALUATIONS. This means the areas of the market that have not captured or exceeded yearly high may do so. Financials-Industrials-Materials-Epicenter stocks ect may outperform other areas of the market as the economy re-opens…we get therapeutics & vaccines and hopefully the cases that do increase see far less fatalities. Place that people congregate (Disney-Six Flags-Wynn-LV Sands) could be significant beneficiaries. Stocks that had valuations bid up thru the roof due to work at home & social distancing could be the casualties. FINALLY…a word on BitCoin which made 52 week highs this week appears to be in the FIRST inning of a very long game (like a early tech stock investor) as we see PYPL is now involved and some spec they will come up with their own digital coin…we saw Square make a sizeable investment…we view Silvergate (SI) as a play also as they are the bankers for crypto firms….. we know the block chain has been a secure system….and we know the next generation is a digital generation….we know the printing of fiat currency is off the rails (Fed ECB BOJ)…we have used GBTC to participate…we are pleased we did……we have other ideas too.

Do you have questions about our Focus List? Go to optionprofessor.com

Stock Market

We have earnings all next week and the list of companies is impressive. We will hear on Tuesday from MRK PFE CAT AMD MSFT MMM ect; we then on Wed. hear from GE BA AMGN Pinterest… but THURS is the big kahuna with AAPL GOOG AMZN FB and ad spending will be a key for some and cloud & pandemic business (shopping is the new entertainment) will be front and center. Expectations for FB includes a almost 12% jump in sales but a 11% decline in earnings ..at AMZN 92B in sales…at AAPL 64 B in the quarter as services will be a key driver but a 6.6% decline in earnings and GOOG sales at 42B new growth 5.6% but EPS -10.5% but a rise in cloud business. This week we saw misses on INTC (data center revenues) AXP (travel) and news that WFC may sell they money mgt division for 3B…..GILD bounce off 60 as FDA gave them a green light…hospitals & health care caught a bid (tenet HCA UNH PFE MRK)…. SNAP did well -Gap- JWN-TJX ROST try to come off the canvas……Covered calls & collars has been our call for the high flyers. Pot stocks are worth a look (MJ ect) and malls (SKI) Outlet Malls and remember we said look at 40 area for DKNG…well they’re here & others.

Want to know more of our ideas? go to option professor.com

Bond Market

Let’s cut to the chase…we told you for months that yields bottomed after the crash….maybe as historic as when they topped with Volker in the early 80’s. .This week we saw the spreads widen considerably (steepening of the yield curve) and should we see a stock drop maybe yields could back down a bit otherwise the landscape ahead includes huge funding needs by Treasury & a Dollar of unknown value and inflation fears…..and a robust recovery in 2021….money velocity needs a bigger yield curve..we’ve said that will occur. As usual we take refuge in limited term munis & short term corporates and AVOID duration for now…something we told you for months and continue.

Need help figuring out fixed income? go to optionprofessor.com

US Dollar/International Markets

The US Dollar remains in the trading range it has essentially been in since August (92-94) which came after a 10+% decline from March highs at 103+. The stability after the decline has kept assets like Gold-Silver-S&P-Euro in a trading range as well as they consolidate their gains. We have heard some say where can you go for a Dollar replacement.. Europe is a museum.. Japan is a Seniors Center & China is a jail…we’re the one-eyed man in the valley of the blind….one of the many reasons digital currency has a future. The dollar could either accelerate to the downside (our deficits-Fed printing) or if we see stocks correct…a safe haven moving toward the 200 day MA above 96 which would blow out the shorts and probably send the Gold-Silver-Euro into the tank (all crowded trades). A always go with the flow/don’t fight Mo. We see improvement and potential in the stocks of China-Japan- Pacific-Emerging Markets as well as Europe as the 50-200 day moving averages are inverted (Golden Cross) and are pointing north.. ETF’s offer diversification. South America looks weak as Brazil is stalled & Argentina’s money is a joke.

We have ideas on how to participate here…go to optionprofesssor.com

Crude Oil-Natural Gas

Crude has been flat lining from 42-36 since June as demand picked up and the rig count tanked..fracking went belly up and OPEC has behaved BUT now Libya has supply coming out and demand is slowing by some people’s measures…that could lead to softer prices but not lower than our support zone around 30…next year we see a recovering economy and jet fuel demand so the 40-55 range is our call. COP bought Concho for 9.7 B in stock deal creating a Permian presence and a shale giant. Natural Gas has ripped higher and trade above 3.00 which is 50% higher than when we got bullish at 2.00 BUT LNG still can’t get above 52 and stay there so we wonder why??

Got energy stocks questions? go to optionprofessor.com

Gold Silver Copper

Copper prices made a 52 week high and then some when it hit 3.21 this week…no surprise to our readers who were told to get bullish long ago (supplies are tightening) and our baby FCX continues to deliver the goods making new 52 week highs at 18.68 this week…a long way from our entry. Gold and Silver are either renewing their uptrends or could see selloff if the Dollar fails to break down and we see a REVERSION to the mean which basis the moving averages is well under current levels….if they start to break down next week and their RSI’s break 50..we would anticipate that we could wipe out some longs prior to a robust year in 2021…tread lightly.

We follow bullion & mining shares…go to optionprofesssor.com

Soybeans Sugar Coffee

We told you back in the $8 soybean area that getting BULLISH wass the way to go and breaks abobe 9.50 & 10 could set up a run toward 12…this week we made 52 week highs at 10.88 so we are getting there BUT we are near the highs of late 2018 so if all markets get hit going into the year end… Soybeans may not be immune….covered calls-collars-trimming considered. Sugar prices were told to you at 12.30 ass a BUY and now we are at the 14.50-15 zone (52 week high is 15.46)…getting above 16 seems is a key for acceleration again they are in an area of failure in 2018 & 2019. let’s see. Coffee supplies are apparently ample and so prices are having a hard time holding gains…we told you a bounce from 105 could be short lived and it was….IF we hold that 100-105 area and take out 108-112 on the upside then maybe the bull rides again….but lately this old Bull has lost its swagger

REMEMBER There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage firm, broker, advisor to determine your own suitability. Past performance is not necessarily indicative of future results , Use Risk Capital Only.

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Update 115: Stock Market-Rosy Prices On Spotty Data=Volatility-Read

October 16 2020 Option Professor Opinions & Observations

Good Day Everybody!….This was a pretty good week for stocks until the last hour of trading on Friday. As we said…the mid Sept highs at about SP 3430 was taken out and we could be setting up for a run toward the SP 3550-3600 area but news keeps coming out throwing water on the rally and we see a RSI DIVERGENCE in a number of the strongest sectors (Dow Transports) that could spell short term trouble. YES! we got great news on consumer spending with the retail sales numbers (we have told you about IBUY & XRT as easy ways to play it for months now). Consumers have gone Shopping which has replaced Entertainment…..are the closets getting full?? Aggregate Households are feeling good with wealth up debts down and savings up but shrinking with all this spending. The annual government deficit is at $3.1 trillion (our ENTIRE national debt was in the 3-4 Trillion range in the 90’s)….it’s a RECORD and only helped in costs by low rates. Also industrial production is negative and the trade deficit is jumping too. You’ve got many record or new highs in all the retailers many with very rich valuations and we still have half the lost jobs from earlier this year still lost (weekly jump in claims)……our suggestion is to remain vigilant as we approach the election…..some believe the upside for stocks is limited in the short term on the frothy part of the market and call options are enormous….does covered calls…collars…replacement trades using calls/spreads make sense…get the facts & decide…if we accelerate thru SP 3420 those odds increase….for now TINA & the Consumer are winning…next week we get EARNINGS from many companies such as BIIB KO COST HAL T VZ CSX TSLA AXP and many more with more to come…Fastly went from 135 to 85 in 2 days (almost 40% drop)…will we see more mutiny as data-prices-election collide? Stay Tuned!

Should you have questions for us???….sign in at optionprofessor.com

Stock Market

What’s in store next for the stock market? Are the lows in at SP 3200? In the next 10 weeks (year end) will we see a stampede into stocks? We believe in following the numbers so SP 3420-3363-3300 are keys for us and RSI staying above 50. We told you since July-Aug that Sept-Oct Nov could be VOLATILE months and so far we got our fair share….more to come? Well…chew on these numbers…the 1-2-3 year moving averages on SP are 3150-2998-2913 so could something occur to see a break toward those numbers? We’ve seen NEW highs on SP & Dow Transports with DIVERGENT RSI’s which can be short term problematic. P/E ratios (valuations) have exploded and 2020 targets of SP 3500-3600 have pretty much been reached. So prepare your plan if clouds surface and save some dry powder in the weeks ahead. We continue to believe the barbell approach will endure (tech-growth-value-materials-industrials-epicenter) and we may see a catch up trade soon. Many stocks & ETF’s on our Radar such as BEP BABA LULU MRNA SWKSS ITB FB UPS TSM QRVO AKAM and many more (oil could surprise in 2021).

To get our ideas for the election & 2021…go to optionprofessor.com

Bond Market

As we said…barring any surprises….we expect yields to rise as deficits-currency-et el will send yields up/priced down….something we told you for months and we see Treasury Bond futures sell off from 193 to 175 since March and TLT (20yr proxy for T-Bonds) fall from 180 to 160 similarly. Short term corporates and limited duration Munis have been our call with the exotics of floating rates-preferred-Junk and EM debt added for risk takers. The Fed may WANT longer term yields to rise to steepen the curve and get Banks & MONEY VELOCITY to get going as Japan & Europe get none with a flat curve. That’s our story and for now we’re sticking to it…..we’ll soon see

Questions on fixed income?? Let us know….Go to optionprofessor.com

US Dollar & International Markets

The Dollar was hanging in there this week not taking out 92 and trying to approach 94…we have told you that the move from 104 down to 90-92 area was OVER and a bounce would occur that would correspond to corrections and consolidations in the markets that ran up (Stocks-Gold-Silver-Euro ect.) So the next big leg up in metals-stocks-ect. and rates will probably need a break of the 90-92 Dollar rate otherwise a surprise move to 94-98 could spell a further correction of size in the aforementioned markets…..On the international front Europe’s got Covid spike problems and more and Asia and EM all are seeing a malaise presently…..again if the Dollars breaks–UP!

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Crude Oil/Natural Gas

Our view remains that the 30-35 area should be worst case for crude oil prices and so far 36 area has held (we are at 40). The rig counts …fracking business…and a cooperative OPEC spells supply controls and with all these cars sales going on…they’re going to drive somewhere and should jet fuel make a comeback we like the upside on oil & oil stocks in 2021 barring a surprise change in the current trends. We stay with best of breed like CVX COP KMI VLO EOG PSX SLB XOM BO RDS.A OKE to play this sector.

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Gold Silver Copper

As we told you when Gold & Silver topped out at $2100 and $30 bucks…we will see pullbacks toward their moving averages and consolidate their advances…this view continues so far this month. Do we anticipate a upside move between now and 2021??…..if we see the Dollar drop & long term rates rise (Inflation & Money Velocity could then jump)….we will add to core positions and ride the next wave which we told you was happening on the break ABOVE $1350 Gold & $19-21 Silver months ago. GDX GDXJ SIL SILJ are all on the radar plus many more….end of the calendar year & the beginning of the new year is Metals Time…..so don’t get caught sleeping at the wheel! Copper still maintaining the 3 buck level…infrastructure & housing…lots a copper used and needed and our buddy FCX (been bullish since single digits) still seems the place to be as long as above 12-14….we have others too

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Soybeans Sugar Coffee

We told you about Soybeans in the $8 area and we thought we could get a run with China buying…we cleared 10.00-10.50 but are stalled a bit now…we thought the recent move opened the door to hit 12 but just under 11 has been the max….prices got extended so a dip was in order….countries like Brazil with a lousy currency may step in and create a competitive pricing atmosphere…staying above 10-10.40 could keep us on track….election?? Regarding Sugar the call to get long when the 50 day 200 dayy MA’s converged at 12.30 was spot on ass we took off into the 14’s…now a bit extended but the trends remain up…if we clear 16 with cause….accelerate? Coffee continues to hold 105 support and if we print above 115-120 then things could get very exciting as they did when we said sub 100 was a steal.

REMEMBER…There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage firm/broker/advisor to determine your own suitability. Past performance is not necessarily indicative of future results. Use Risk Capital Only

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Update 114: Stock Market-Rising Tide Lifts All Boats-Read More

October 9 2020 Option Professor Opinions & Observations

Good Evening…..This week was a very key week POTENTIALLY as we took out the SP 3363 resistance last week and the SP 3430 resistance this week and participation widened out considerably. Our original view that Sept Oct Nov time frame will lead to VOLATILITY has still played out and our view that a trading range of 3500-3100 is still in play but now we must consider that SP 3215 (61.8% retracement) could be the low and with stimulus and infrastructure either coming immediately or soon after…..that $4.3 Trillion of sideline cash (not counting private equity & corporate cash) is hard to step in front of as we know sellers will raise their offers to the moon if the market will bear it. Lots of dry powder & heavy Short Interest in the NDX. Covid is scary but the FOCUS may not be on CASES but SEVERITY (deaths) We are not totally out of the woods…..household income has been lost & drawing down savings only lasts so long….job cuts (as we told you would happen 6 months ago as corporations re-size for peak earnings) continue at the airlines, Disney, Warner Media, Banks and more. Housing, e-commerce infrastructure, Communications, Digital Lifestyle will remain the themes. However; a peak at bank earnings (loan defaults-Commercial Real Estate) plus retail sales and closing to what could be another Nightmare on Elm Street (A.K.A the Election) looms ahead…..so the barbell approach we’ve encouraged since March remains-Tech-Growth-Value-Utilities-Epicenter.

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The Option Professor Model Portfolio Ann Return (w trading costs): 321.6%

Stock Market

Next week we get earning from the banks and others plus Delta and more stimulus jaw-boning. Looks like B of A is getting into the pay day loan business and we got lots of merger action this week as well…Morgan Stanley got into it with Eaton Vance (is Invesco or Janus next??) while AMD and Xlinx are looking at a $30 Billion dollar deal and some talk of a Exxon Chevron merger but that may be more of the beer talk variety. International Paper IP & WestRock may be ready to profit bigtime on the move to paper shipping materials and as you can see e-commerce delivery just took the Dow Transports to RECORD levels not seen since 2018. This may also confirm an up move for Dow theorists as this piece of the puzzle had been missing. Workhouse is in the finger pointing game as with Nikola about the veracity of some of their data. Our favorite betting stocks DKNG PENN CHDN all are getting hit (DKNG announced a secondary offering-never welcome news) and all should be buys again in the not too distant future but maybe the reduced sports schedules & their nosebleed valuations have caught up to them. Some of the symbols of the recovery stocks on out Radar are TJX DLTR GM UNP CSX JCI BWA ROST SCI IEX GWW WYNN BKNG

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Bond Market

Not much to report here as yields were pretty flat all week with an upward bias. Of note is the % jump in yields has been 50% since the lows and 20% in the recent past…big numbers. TLT which we use to assess long term rates (and where we see the greatest duration risk) closed at 160 and it has broke the 50 Day MA at 164 and intra day broke the 200 day MA at 159.50. So we feel if the markets take off and growth starts cooking…TLT could accelerate to the downside HOWEVER…..the 50 day iss still above the 200 day (164-159) so this could be a garden variety pullback after a huge up move and should we close ABOVE 165 with weaker stock action…forget the bear-get bullish. We favor short term Corporates & limited term Munis but if you want to spike your drink…look to floating rates, preferred, High yield & emerging market debt if you want to stretch part of your portfolio & risk profile.

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US Dollar/International Markets

Europe is in a stall phase as Italy & Spain desperately need help from the Recovery Fund and soon. One of the Europe ETF’s we watch (VGK) closed at 54.50 with the 50day/200 day MA’s at about 53-51 inverted to the UPSIDE so unless we take out 50 maybe the cheap valuations of their shares win out. The BIG OPPORTUNITY overseas could be JAPAN (EWJ) as the Nikkei is flat on the year while the USA is up and Korea (EWY) and Taiwan (EWT) have both made good advances and some believe EWJ will play catch up. Emerging Markets China South Pacific all have been picking up steam. The US Dollar lost steam from last week…we told you a bounce out of 90-92 could go to 94-96 but then a reversal would occur….with deficits stimulus trade deficits and record structural unemployment…can you blame them? So if we hold 92.50/93.00 area (61.8% pullback) maybe we have more upside but the avalanche of printing could spell trouble for the greenback although are the Euro & Yen great alternatives?….No….but Gold-Silver-BitCoin ect.???

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The Option Professor Model Portfolio Ann Return (w trading costs): 321.6%

Crude Oil– Natural Gas

For those of you looking to renewables…a stock we have been keen on this year is BEP Brookfield Renewables which hit a low in March around 25 bucks and now trades 52. We have been telling you our view is that 30-35 is worst case for crude prices and we recently hit 36.50 and now trade above 40 again…we believe next year we will see a demand reversion while seeing RIG COUNTS lower than 2015 & fracking is a rough racket plus couple that with a well behaved Saudi supplier and for the patient the CVX SLB KMI & others may pay off…be careful of XOM who we read is borrowing money to pay the 9% yield…silly. Nat Gas is all over the place…LNG need to get back in the 50’s to renew our interest and a break under 45 could be a back breaker

We follow many ways to play energy….find out at optionprofesssor.com

Gold Silver Copper

Well these 3 had a great week as the Dollar faded and happy days are here again blared out of traders radios. We’ve been bullish copper since 2.50 and FCX since 7 bucks so we’re not just arriving here. We needed to hold 14 on FCX.. we did.. and now more upside. Housing & Infrastructure music to us. Gold & Silver hit short term lows in late Sept and turned up this week as the dollar hit the fade mode. Still in trading ranges with resistance in Gold at 1950-2000 7 the at the highs of 2100. Silver is above the 24 level which is a good sign but resistance at 27-30 looms ahead…..our mining shares GDX GDXJ SIL SILJ all got a bang to the upside…DXY takes out 90-92….we soar.

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Soybeans Sugar Coffee

How did our three bulls do this week?…Soybeans which we told you about since the mid $8 area made NEW HIGHS at 10.80 area and closed at 10.65..if China needs to hit a buy quota—we said the upside could be 10-12 or more. Sugar prices looked great and we said the buy was when we crossed the 12.30 area (50 & 200 day MA’s converged)….this baby closed at 14.22. Finally Coffee which was a favorite early this year…got way overbought…corrected right into our support zone (105-110) pooped back to 112 area for a nice trade but jury still out if that’s all we’re seeing….under 105-get outta town?? After big runs in any markets…always be careful of a reversion to the mean.

REMEMBER —-There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage firm, broker advisor to determine your own suitability. Past performance is not necessarily indicative of future results. Use Risk Capital Only.

The Option Professor Model Portfolio Ann Return (w trading costs): 321.6%

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Update 113: Stock Market- Will Stalled Leads to Drop? Read More

October 2 2020 Option Professor Opinions & Observations

Hello Everybody….What a Week!!….We had a national embarrassment (the “Debate”)….we had President Trump et el test positive for COVID (reminds me of what my brother Kevin used to say to me “What Did You Expect?)… and we had a jobs report that confirms what we’ve told you for a while…the economy is slowing and so is the rebound pace and the easy wood had been chopped. Comparisons to this pull forward demand we saw is going to be tough and a spike in cases worldwide will not help…..earnings may get people feeling better & so would a stimulus bill…one of the 2 may not happen. From NYC real estate to downgrades by Moody…the turn around has lost steam…add in durable goods report…personal income (spending savings)..manufacturing pull back on top of credit card activity..open table..bookings for hotels and you get the picture…..if we take out SP 3450 (around mid Sept Highs)…we’ll reassess our opinion that the market hit a SHORT term peak and the correction could take us back to the SP 3100-2900 zone…..if we take out the recent lows of 3200 in the next couple of weeks the odds of that scenario coming to pass will exponentially improve as well. So will a stimulus bill & better news on the Virus get us back on the horse… maybe but we’re betting the other way until & if the yield curve steepens.. .the Virus subsides…the stimulus arrives and VALUE take out recent highs. We told you the Sept Oct Nov time frame could be tough and despite the rally which faded Friday…not ready to join the crowded “Pamplona” trade.

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Stock Market

As you know…it is a market of stocks and not a stock market and that was true this week. Mega cap Tech gave up the goose (FB AAPL AMZN MSFT ECT.)…while ZM PTON TDOC did well ass Virus cases spiked BUT we suspect the old story (when the cops raid the brothel everybody goes downtown) will prevail. If we break the QQQ’s….looking for the one-eyed man in the valley of the blind may not be wise. Energy shares got whacked like we’re either going back to the horse and buggy or cruise with the Jetsons…hey guys…stick your head out the window on the freeway..lots of fossil fuel..so when we see Chevron CVX paying 7% plus dividend currently & Royal Dutch Shell RDS.A…we figure blood in the street (not ours) is a good thing. Unusual option activity in DDOG AAPL NVDA & XPEO while stocks like UPS DE BABA DKNG CYRX SONY DIS ROKU were definitely on a radar this week

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Bond Market

The story here is JUNK bond issuance which saw the biggest Sept EVER on record and the 3rd biggest month EVER on Record. Hey.. tight spreads lowest rates EVER and record issuance and if these companies misss on earningss the mosst LEVERAGE ever maybe…how do you think it’s going to end? THe yield on HYG is about 5% and the high in Jan was 88.53…it closed Friday at 83.83…already lost the yield…now it’s trading under the 50 day and could break the 200 day anytime and daily volume off 20% or so…if we are correct on stocks possibly taking a leg down and if we take out 80 HYG investors may be reminded why they call them JUNK Bonds. NYC munis downgraded by Moody’s…the beginning of a stampede with no stimulus?

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US Dollar International Markets

We told you a SHORT term low was in on the Dollar in early Sept and a rally toward 94-98 areas was expected…right on! We also told you the March DECLINE from 104 on DXY also fueled the stock gold silver rally since late March…we also told you the TURN in the Dollar in Sept Upward also sent sstocks gold silver on their REVERSION TO THE MEAN TRADE which it remains in the midst of completing. We told you the Euro was a buy at 110 and a sell at 120 and so far that’s true (closed 117). It may be short term as the FED looks to explode the balance sheet further…but DEFLATION in the Euro zone & Japan is scary as a FLAT YIELD curve does not work as our view is MONEY VELOCITY cannot occur without a steeper yield curve…we don’t have it now but we believe we will in 3-6 mos but Japan & Eurozone do not have a clue. We believe there is a RISK of an ACCELERATING RISK OFF in EM Europe Asia in the weeks ahead especially if COVID comes back strong & the stimulus fight is He on & of course the potential of Election Chaos…hey if the numbers flow the other way…we won’t fight the tape.

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Crude Oil- Natural Gas

Crude Oil tanked this week ass the slowing economic numbers plus the Libya oil flood plus the Virus spike has the bulls on the run & bears controlling the tape…..BUT we believe 30 is worst case pending a collapse of the economy as next year a 40-50-60 print may be in the cards as DEMAND returns and that means oil refineries oils servicing ect may have value here. Natural Gas is a wild ride from 1.75 to 2.75 to 1.75 to 2.92 to close 2.44 OUCH

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Gold Silver Copper

The big story this week was the hit they put on Copper prices as we fell from like 3.07 to 2.83 (17% hit) only to close back at 2.98…..all things considered it hung in there and infrastructure and new home sales & China back in business can’t hurt..our baby FCX since 5 bucks has pulled back..stay above 13.50 & 14 and we say 2021 should be a banner year. The Gold and Silver were in trading ranges with Gold 2100-1900 and Silver 30-24 but those ranges were violated…long term still bull market but lotss of real estate between here and support…core positions hold …extra..WAIT!

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Soybeans Sugar Coffee

As you know we were bullish on Soybeans for months from the 8 to 9 range and felt a close above 10-10.50 could open the door to 10-12 as China demand and other factors could get us going…we went to 1.50 area turned down to sub 10 and closed at 10.20. Now a close ABOVE 10.50 could get our engines going or a close under 9.75 could stock a fork in the Bulls..WATCH The coffee market was one of our favorite this year and for good reason.. below 100 we saw a steal…rally toward 140 now hold the 105-110 area and a second sprint to the upside exists…let the cards come out….Sugar held the pullback support 9 to 10 area then the 11-12 area and busted well ABOVE key averages in the 12.30 neighborhood..we closed at 13.58 so far so good BUT it needs to surpasss 14 to really get trucking and there is a gap near the BREAKOUT POINT at 12.30..retest?? maybe but we are overall BULLISH!

REMEMBER -There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage firm/broker/advisor to determine your own suitability. Past performance is not necessarily indicative of future results . Use Risk Capital only

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Update 112: Stock Market-How Low Do We Go From Here? Read On

September 25 2020 Option Professor Opinions & Observations

Greetings!…Well we told you a few weeks back that we had a BLOW OFF short term top and last week that DECELERATION was upon us and this week we saw strong selling followed by a week end rally. We told you credit card data. open table & hotel bookings were all rolling over and with no stimulus package the risk of those numbers softening is high. We saw durable goods orders roll over this week and while ISM & PMI numbers are hopeful Goldman Sachs CUT GDP estimates for Q4 in half! Let’s face it there is risk to the downside particularly if 3428 SP holds next week as the scary election (Trump may refuse to leave/rigged election/AG Barr at the ready) PLUS the panic to get RBG replaced but no panic on stimulus PLUS a COVID SPIKE in some states & EUROPE reminds us we are no out of the woods. Earnings will be forthcoming and as we told you in MARCH-APRIL…be prepared for surprises on the upside as less employees & real estate would help return to peak earnings. Hey..the long term trends are intact (we told you they were reestablished in APRIL when we got back above 2800 SP (3 yr MA) BUT REVERSION TO THE MEAN is occurring EXACTLY as we said & we EXPECT more to come. The 1-2-3yr MA’s on SP are at 3108-2963-2886 and we believe they are all FAIR GAME between now and year end but we targeted SEP-OCT NOV ass the time frame for this correction BACK toward the mean. This includes any and all OVERBOUGHT markets like we told you GOLD & SILVER would revert back down and it has big time….Again prices could get very choppy between now and the election & thereafter so IF we close up above 3428 we would be encouraged but maybe they would just be running the stops. Could there be an October surprise after rebalancing early next week? Sure…if it has anything to do with vaccines & stimulus (credible) then that would be different but we still have 13 Million on the dole and almost 900,0000 new claims last week….caution is the better part of valor.

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Stock Market

We got a big run in Covid stock beneficiaries late this week (PTON ZM TDOC ect) as the news of a Europe spike in Covid case got traders running with the idea of more cases coming our way and an extension of the status quo. The Nasdaq finished the week positive by we believe more wood to chop at lower levels absent a break in stimulus talk. Lots of stocks to follow-trade including JETS as more money for airlines on the way likely. The cruise lines (CCL ect) got upgraded as well as safe to sail expected soon. Uber caught a bid as we prepare for the Prop 22 vote & sports gaming in on the huge bull run (DKNG PENN WIMMY CHDN) as millennials maybe have found a pastime better than Robin Hood….online & anonymous…just like the want it. Stocks such as TECH PEP QCOM UPS XPO STC TGT Fire eye all were on the radar and vaccine stocks like NVAX & PFE & MRNA (who has certain technology that could unleash 23 more drugs) also got a look and GILD may be a worthwhile value around 62. Speaking of value…that trade hass been put off for now ass trends were broken and resistance held but we will keep an eye on that ball because quality firm & high dividends have value especially if we see the yield curve steepen. CSCO has a PE ratio that’s reasonable and when we return to in office activity then they will shine plus the generate 14 Billion in free cash flow and pay way above 3% dividend. WCLD & CLOU had good weeks as we ran back to tech at the end of the week. Disney Hong Kong opens this weekend so keep an eye on DIS

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Bond Market

The times they are a changin’ in the Bonds as we said markets are reverting to the mean and JUNK bonds have been been retreating for 2 weeks & had their worst week since April. At some point overleveraged (CCC debt was very popular) and the public’s appetite for crazy was going to correct. Defaults rates are at 8% and could go to 12% easy with a stalled economy and the unknown ways things may break (forbearance-stimulus-election). RECORD junk issuance this year and no beta protection in 60-40 portfolios which forces investors to take more risk-accept lower returns or redirect part of their risk % into more aggressive areas (Gold/Alternative Plays).IG short term is insulated ass the Fed is clear about supporting those but the rest (HY-Munis-Preferred Mortgages) may not have such assurrances though they have traded ass if they did. We said still with IG short term corporates and stay away from duration as if the Fed want to steepen the yield curve (help banks) and inflation up/Dollar down…risk & no return.

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US Dollar-International Markets

We told you that the Dollar hit a low in the 90-82 selloff zone and looked to rally EXACTLY what has occurred. We told you the Dollar TOPPED in March and fell 11% which sent Stocks & Gold-Silver & Euro soaring NOW we see the US Dollar hit the short term bottom in early Sept and since Stocks-Gold Silver Euro have been in the FADE MODE. We said if the Dollar breaks 93-94 and maybe goes further to 96-98 it could be a catalyst for a FURTHER FADE International market that benefit from a stronger Dollar and weak local currency (Turkey TUR Brazil EWZ & Mexico EWW) got a bounce but overall Europe’s PMI’s & Banks & Virus spike put them on the outs and Emerging Markets & Asia are fading as our economic numbers fade…the world is on defense as we said it would be in this time frame…if the numbers change-we change but for now FOMO has left the building…not the country.

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Crude Oil Natural Gas

After last week when we got a big jump to the upside..this week was a big nothing in price movement but we closed with a 40 handle. The BIG news was the machete they took to energy stocks in the last 2 weeks which wreaks of give up on the idea of a V shaped recovery and DEMAND returning soon. Best of breed is Chevron CVX with the best balance sheet to survive & thrive and a heck of a dividend north of 7% and so far secure. Keep an eye on this sector & the banks…very unloved very cheap. Natural Gas was a big winner when we spoke about it under 2.00 and a breakout up toward 2.75…we broke 2.50 and tanked toward 1.75 and this week on WED soared out of the blue to 2.75-2.90 area…our buddy LNG needs to break 52.

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Gold Silver Copper

Another REVERSION to the mean story ass when the Dollar turned that panic we saw to 2100 Gold & $30 Silver was OVER. We feel in the months ahead Gold in the 1800-1700-1600 areas and Silver $17-$20 range could be in the cards followed by a nice resumption of the powerful uptrends fueled by monetary base explosion and structural stimulus that will last for years. Copper has been a real soldier comparatively but did break 3.00 this week and our buddy FCX retreated as well (more reversion to the mean). Long term still up trending so don’t throw the baby out with the bath water.

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Soybeans Sugar Coffee

Blood Sweat & Tears sang “What goes up must come down” (were they traders?)…well that was the story on Soybeans as we shaved off about 50 cents off a great run which we told you about months ago. Resisstance was 10.00 & 9.50 on the way up…let’s see if it’s support on the pullback. China is supposed to buy 130 bill in 2nd half of this year to comply with phase one so maybe they’ll be back at the bar after backing off. SSugar; we told you was a go after it got above 12.30 an it had a good week while Coffee hasda a big pullback to former resisstance & breakout point 105-110 and turned up…it could be ready to re-caffeinate the bulls in the weeks ahead.

REMEMBER There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage firm/broker/advisor to determine your own suitability. Past performance is not necessarily indicative of future results, Use Risk Capital Only.

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Update 111: Stock Market- Deceleration Is Here-What Now? Read On

September 18, 2020 Option Professor Opinions & Observations

Greetings Everybody! Our view remains that we are in a TRADING RANGE of 3500-3100 for now. As we told you for week that the VALUATIONS & PRICES were stretched in the Nasdaq & we directed you toward HEDGING strategies like Covered Write/Collars/Married Puts/Replacement Trades. The stocks that were bid up like AAPL TSLA MSFT AMZN GOOG NFLX ect had great jump in sales during the last 6 months BUT Price to Sales has soared & that we have already adjusted to ZERO interest rates…the comps are getting tougher as you look down the road…..in fact indicators like credit card spending, open table & hotel bookings have rolled over a bit and even housing starts were DOWN 5.1% in August…not panic time but pausing time The economy thru the lens of ISM #’s (56) and new orders index (near 70) give a firmer footing BUT almost 13 MILLION people are still getting $$$$ from Unemployment Benefits. As we have told you; the Russell Value versus the Russell Growth Index took out the 1999 highs….this week Russell Value was UP while growth sold off. As we told you…while we see much better values as TECH-SEMIS -MEGA CAP GROWTH-CONSUMER DISCRETIONARY (we we brought to your attention in March & April) as they approach their 200 day/1 year Moving Averages….we believe that the BARBELL APPROACH we said was the way to go REMAINS…(Growth-Cyclicals-Value)….In MARCH we told you the way we come OUT OF THIS is #1 TECH leads the way as WORK FROM HOME ect creates huge revenues for the likes of AMZN AAPL MSFT NVDA ect and with rates at ZERO VALUATIONS WOULD SOAR.. this is Exactly what happened #2 As we normalize the cyclical & the value names would play a serious game of catch up and the epicenter stocks as well.. OVER the next 3-6 months we believe this will happen. #3. We EXPLAINED that companies could return to PEAK EARNINGS much FASTER than any thought as they would CUT JOBS & NOT REHIRE plus cut back on Real Estate expenses (2 huge costs) again EXACTLY as we are seeing now. We said TANGIBLE ASSETS would be king (real estate-precious metals-businesses). You Should Ask….WHAT IS THE TAIL RISK?….it comes back to the value of the DOLLAR. In March; the Dollar hit about 104 during the crash as people rushed to “safety”…then they discovered the INTEREST RATE ADVANTAGE the USA had went out the window when Powell brought rates to ZERO. This led to a 10%+ DECLINE in the Dollar and BOOM there goes Tech & Metals & Real Estate. Around LABOR DAY; the Dollar stopped going down and Stocks & Gold & Bonds have now stopped appreciating. The Fed is TELLING you they will let INFLATION rise for a sustained time and OUR VIEW is that it is because it will happen as CURRENCY VALUE will be determined by factors #1. MONETARY DEFICITS (USA Money Supply is UP 25% more than 4X the NORMAL) #2 FISCAL DEFICITS (USA Fiscal Cliff looks like Niagra Falls) and #3. TRADE DEFICITS (No matter all the tough talk & tariffs-Ours is HUGE). Airlines & restaurants ect will be smaller…what to do?…they’ll RAISE Prices. In the next 3-6 months….our view is investors will WAKE UP and realize that the 10 yr Treasury yield is a joke & that the 30 year Treasury yield is a farce as the economy rebounds and the DOLLAR hits the skid after this short BOUNCE it’s enjoying. The Fed WANTS this in our view because MONEY VELOCITY is TANKING and you can’t get VELOCITY in a FLAT Interest rate structure (ask Europe & Japan how it’s working). Simply put the BANKS need to get involved to get Velocity going which means they need a SPREAD between short rates & long rates….otherwise it’s no good. Did you notice CORPORATE DEBT issuance has soared even on lousy companies BEFORE the election (CCC paper is outperforming)….maybe their higher Earnings can help them handle it….or the Fed gets a facility & buys.

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Stock Market

Lots to talk about here from Zoom to Snowflake & don’t forget the Apple show (though some apparently did). Zoom sales are up 350%+ in the last year and has 150+Million monthly users.. fantastic numbers…but the valuation is equally fantastic…the risk is will it be sticky when a vaccine comes out and how can they keep the pace & grow from the numbers out of the pandemic. Competition has got to be coming from others looking to create new revenue streams. Snowflake has a great story…the AI of cloud as it allows you to analyze and share data while getting insights…all very good for business. Great customers (146 of the Fortune 500 & counting) Great revenues (+133% in recent months) Great early investors ( Buffett & Brad Gertsner ect) Great Management (Frank Slootman-brought Digital Domain & ServiceNow to market/Partnerships (Salesforce)……so what’s not to like?? Well the price came out at 120 and rose to 319 down to 215 and went home at 240 so a wild ride it has been ass 100-150X Sales is a tough valuation. Other news was on Ford (new plant makes EV’s like the F150)…also Fed EX which is hiring 27%+ more than last year for the holidays and some say they could score big with VACCINE distribution. Berkshire Hathaway BRK.B is liked for some as when we turn the corner Buffett has got the AAPL/best insurer in the land/energy/banks /Japan rebound and a huge cash pile. Also Face book at 240-245 & APPL 85-95 area has bids plus Boeing who got news hammered (1000 cancels on Max) supposedly is near 150-158 support. Industrial names like Emerson Electric & Honeywell are worth a look as well as CPRI & OLN & DAVA. Too much to include here…so its time to go to optionprofessor.com and submit your email to learn about access to more.

Bond Market

We have had the view that the ETF’s on fixed income have been very overbought and would pull back closer to their moving averages and in the last six weeks they have done just that with TLT fading from the 172 to 162 and now have a number of moving averages crossing over. Longer term we see longer term rates rising as the recovery expands and the value of the Dollar resumes it’s secular bear market by year end. We have ETF’s we focus on to get income and ones we would suggest you avoid like the plague…to find out more go to optionprofessor.com and submit your email.

Us Dollar/International Markets

The Dollar rebound continues albeit mildly…if the DXY breaks above 94…look out below on the markets that rose in part due to a weak Dollar. We believe a break ABOVE 120 on the Euro could spell 125 but the Yen & Can$ remain subdued…some believe the AUS $ could make a run at parity if it breaks ABOVE 75-80 over the longer term….we’ll see how that unfolds. On International markets …most were on the defensive China (FXI) Europe (VGK) Asia (VPL) and Emerging Markets (VWO)…following the USA for now.

Crude Oil/Natural Gas

Lat week we told you the Saudis were discounting…this week they’re scolding OPEC…one the better performing sectors this week was energy (VDE) before pulling back…their remains short term DEMAND fears…we stay with our call….30-35 worst case downside and big cyclical appreciation as we get a more expansive recovery in the year ahead….again not enough room here to cover the ETF’s on both Oil & Nat Gas (which pulled back as we told you 2 weeks ago after overbought big up move) so simply go to optionprofessor.com & learn how you can subscribe to our Focus List.

Gold Silver Copper

The precious metals remain range bound with Gold 2100-1900 and Silver 30-24 meandering back and forth…if we break 94-95 on the Dollar Index..what we said for a while is that SEPT-OCT-NOV could be dicey for both Stocks & the Metals…..we saw a print in the 1800’s already during the decline ….can’t rule out a 1600-1700 print in the next period ahead. BUT longer term is a horse of a different color so we have a list of Gold & Silver stocks & ETF’s that we told you about in March April BEFORE they ran….Kinross just paid their first dividend in 7 years…get over to optionprofessor.com & learn about how to get our Focus List in metals. Copper is a Goldman Sachs favorite (Readers know it has been ours for 6 months!)…and our buddy FCX hit 17.50 this week…our bet since 6 bucks.

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The Option Professor Model Portfolio Ann Return (w trading costs): 515.4%

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Soybeans Sugar Coffee

The Soybean trade we told you about for months (remember the reference Waiting for Godot) is staring to accelerate as it looks like China is trying to help Trump get votes in the Farm Belt (along with his Billions in giveaway money) and he’ll call off the dogs a bit. we jumped to 10.43 this week and we brought thiss to your attention in the $8 range…not bad. It’s getting OVERBOUGHT short term but when beans go sometimes they go nutty…we felt a break above 10 could open the door to 10-12 window…RSI’s very hot In the Sugar trade.. we told you that the moving averages came in at 12.30 area and we could accelerate on a break above that area…this week we did and we closed near the highs…a close above 13.20 would be powerful but staying above 12-12.30 bodes well for the future. Coffee was a darling earlier this year as our focus list had us bullish in the 95-110 area BEFORE the move to 137….the break UNDER 130 put a fork in this one ….now our view at 113 is that if 100-110 hold…maybe it get back on the horse…..

Remember There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage firm/broker/advisor to determine your own suitability. Past performance is not necessarily indicative of future results. Use Risk Capital Only.

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The Option Professor Model Portfolio Ann Return (w trading costs): 515.4%

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Update 110: Stock Market-Wait!! Buying ReLoad Coming-Read More

September 11 2020 Option Professor Opinions & Observations

Welcome Back!..We told you in prior updates recently that Sept-Oct Nov could be a time of sizeable re-valuation and a reversion to the mean (50-200 day moving averages) and that is EXACTLY what is happening. Will there be more to go? Well here is our view…..there are 2 ways the market is much more interesting to us. #1 is we go down and values are much much more compelling or #2…they start taking out the monthly highs indicating we’re back on track….otherwise making a decision in a trading range is foolish… and that is exactly what we are in right now…a trading range. Th election is coming up and who knows what story will be bought…the story of “The Greatest Economy in History of the World”….which included a 40% tax cut used for buy backs….news jobs that were lost & didn’t pay much….the America First baloney where we had a $63 Billion dollar deficit with China & an $11 Billion Dollar deficit with Mexico and in 2018 & 2019 the combined trade deficit with china was $764 Billion. No complaints that money hasn’t been EASY from the FED…1/2% T-Bills & 44% of GDP injected by some “creative” moves by Mnuchin & Powell to “comply” with The Fed Act 1913 forbidding the buying of exactly what is being bought by the “facilities”. On the other side you’ve got an alternative to whatever the heck has been going on….Trump’s scorecard has been the stock market so one would assume all measures short of outlawing selling will be done to get a rally pre-election. On the other side…who cares…the Fed calls the shots and if Powell sticks with Buy American Stocks…we should rally after the election. Stats like 52% of young adults live with their parents bodes well for housing. The 5G stampede is coming and NVDA (big data/gaming) Broadcom Qualcom are not bad fishing lakes in the next 2 months….Bill Ackman’s Pershing Sq’s portfoio seem confident in the future (Lowe’s QSR CMG Agilent ADP HHC MDLZ ZTS Freddie & Fannie ect). Nasdaq had it’s worst week since March and the quickest 10% drop (3 days)..they are revaluating things and if you’ve read our updates…it is what you expected…we discussed tactics for protection (Covered call collars married puts replacement trades ect)… ..those all made a lot of sense to many….fearful when others are greedy….

Questions on tactics or otherwise email [email protected]

Stock Market

Let’s cut to the chase…big cap growth tech semis covid beneficiaries all have to come back to earth and they are….epicenter & value stocks with its 14-16 P/E’s need to hear one word VACCINE and they will get the jolt they need to take out June Highs and at least go back to yearly highs or beyond…that is a lot of upside and compared to hoping some of the high flyers take out their recent highs…we would bet the former. We’ve said all along that the split trade (TSLA & AAPL) would turn into massive sells once they hit the market EXACTLY what happened….they should have been HEDGED…..now TSLA has gone into the 50 Day M-Average zone (300’s) a much better price than 502!…but it is AAPL that we find the most intriguing as the reality is their growth in top & bottom line in the last 2 yrs has been OK…but the future could be dynamic as 75-80 million I-phones have been ordered and the MARGINS on these could be huge plus Laptops Ipads & wearables which leads us to believe that 80-100 is a steal (a gap in the 90’s/200 day is 83+). There are many stocks we believe should be on an investors shopping list ans some can replace income too as they have dividends of 2.75%-3.75% so if you want to know just email us….plan now execute later is the idea.

Bond Market

Not much here to report as the Fed does it’s thing keeping savers in the dark and encouraging yield starved pensioners to take more risk (value stocks). TLT the proxy for the 20yr Treasury is stuck in a tight range after yields popped a bit..a break above 170 could mean get ready for even lower yields and a break under 160 could signal that someone figured out that a lower dollar inflation and deficit spending is not a good deal for 1% until 2040:):) Junk bonds (HYG) are testing lower prices and one would have to think if the Fed didn’t have a “Facility” to buy them they would be in the toilet. In Preferreds (PFF)…they’re hanging in their with a good distribution and many are linked to banks…so if you believe….Munis have been coming down a bit as job & service cuts have to occur unless while the Fed & Mnuchin are printing money they can find some for the states (the spent plenty on the airlines who are still firing people)….bailout is obvious. The emerging market debt we told you about (VWOB) has done well since March and if the Dollar resumes its downtrend later this year-a positive.

US Dollar/International Markets

Our position has been the US Dollar hit a short term low 90-92 zone and is in a muli-leg rally…closing Friday at 93.27 which means we are looking for the Euro to fade off the 120 rally area (closed 118 area)….IF the Euro breaks the highs then 125 becomes the next target if not 115-116 is ahead…the Yen & the Can$ are comfortably UNDER their M/A’s..& Aus $ stable 72-73 for now Looking at stock markets around the world most are stable but could see some selling Germany Brazil India with Japan (Buffett ?) & Korea showing some boat legs. Same story with ETF’s like VEU VGK VXUS VPL VT & more

Crude Oil Natural Gas

We told you in previous updates we thought a move down in crude oil could be in the cards and we saw a drop from 44-36 area in tha last couple of weeks…the glut of oil trade (contango has front month way lower than the back months) plus the nice guys Saudis cut prices …30-35 should be as low as she goes and sets up nicely for strong demand in 2021…that’s our view so keep an eye out for those high yielding oil/energy stocks. We were bullish on Natural Gas UNDER 2.00 and the breakout above and loved the move to 2.75 but warned that the market was over bought and a break of 2.43 could see prices crack EXACTLY what occurred this week (close 2.25). Our stock we follow LNG has 50-200 day averages at 51-49 and we closed at 49…so if we take out 49 the odds increase for at least a move to 45…hedge?

Gold Silver Copper Platinum

Short Term…we’ve said it looks like the “precious” metals have topped at 2100 Gold 30 Silver and the stocks ass well GDX at 46 and Sil at 53 but with the intervention Fed around the Dollar which has gained steam could reverse and then the metals get the green light….In Fact…when the Dollar turned DOWN from March 102 area and lost 10% is when stocks & metals roared. Now the turn in the Dollar (albeit modest) led to declines of both. Copper is another story as it has mainatined abov 3.00 and by doing so has made our favorite copper stock we told you about all year FCX make new highs this week….both are getting a bit overbough-keep it on a short leash

Do you have questions??..email [email protected]

Soybeans Sugar Coffee

Let’s see how these exciting Three Amigos did this week….we have been bullish Soybeans since the $8 area and have said that if start closing above 9.50 we could start accelerating to the upside and a close above 10 could set up BIG potentials gains opening up the 10-12 area….well Friday we closed near the highs of 9.98 so get your seat belts on because if we breakout for cause the momentum is building BUT if unable to break thru profit taking and speculative shorts & hedging could be problematic. Sugar has been untrustworthy in some regards as the breakout above 13 should have been a green light for a sustained advance but instead it went back into 11-12 support zone (close 11.93) bothe the 50 day & 200 day MA’ss come in at about 12.30 area so IF we get above there and hold/closes..we’ll like it. Coffee has been great to us ever since we first liked it under 100 nad on the pullback to 110 BUT as we ssaid the market move toward 139 was stretched and a pullback was expected and occurred (MA’s at 114/112) so at least a level of 125 or an acceleration thru 135 work as short term key points,

REMEMBER There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage firm/broker/advisor to determine your own suitability. Past performance is not necessarily indicative of future results Use Risk Capital Only.

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Update 109: Stock Market-Timber! Now What to Expect? Read More

September 4, 2020 Option Professor Opinions & Observations

Greetings All!…Last week we said this week would either be a Stampede or a Blow Off Top and who knew we got both in many markets! We told you that the VIX was RISING during the rally…not a good sign…and many other red flags and that you should have your HEDGING tactics at hand (such as covered writes/collars/married puts/replacement calls/trimming ect)….we also invited your emails for more information to take advantage of our decades of experience…those who emailed us were VERY glad they did. S&P price to sales ratio was at a record….46% of all S&P stocks haven’t gained in 2 yrs…ZOOM had a market cap of $130 Billion on 2 or 3 billion of revenues!! The Fed is playing a stupid game (Trump Powell Mnuchin) are private equity leverage guys and could care less about debt…..run it thru the roof…get every company in America hooked on borrowing…try to get the public hooked on borrowing (although the public is not so stupid ass loan demand stinks & money velocity is i the tank)…..hey maybe their plan is if we get asset prices soaring through VALUATION expansion we can all get re-elected on greed…if not our big donors get all their stock losses back and we’ll do business with them when we leave…..44% of GDP in QE this time when in the last crisis in 2008 it was QE 5% of GDP–9X More??……last time it took a number of years to get the S&P 500 back to the highs…this time a few months??…..what’s the rush to blow out the balance sheet & USA Debt? ..Corporations are leveraged to the hilt and some don’t have much equity not a good thing. Unemployment says it’s “down” to 8.4% but still almost 30 million receive some benefits….11 million still out of work..16-25 yr old jobless rate at 20%.. and cuts by airline and other companies are forthcoming. The Fed is saying rates low until inflation zooms back (with money velocity tanking that’s a reach)….so they are encouraging RISKY valuations/borrowing/investing…. some factors in the recent spike & fall was call option activity which went off the charts…in our view similar to 1987 “program trading” as investors (some say Softbank) bought stock and sold call or bought stock to hedge short calls which squeezed Tech in particular and then the last 2 days unwound those positions (sold stock bought back calls) …all very risky activities as liquidity is problematic (we told you last week that if we roll over the SELL volume would DWARF the BUY volume EXACTLY what occurred). Now we have a vaccine on the way Nov 1 or 2 days before the election…we sometimes think we’re watching a suspenseful TV show (Remember Dallas & Who Shot J.R.?)….but this VIRUS is not a TV show & our people are not actors. Our Trade Deficit is Soaring!! So WHAT’S OUR VIEW RIGHT NOW?….well the best case is that we go into a TRADING RANGE and we work off some of the EXCESSES such as distance from the MOVING AVERAGES/VALUATIONS/COMPLACENCY and settle the VIX down after it jumped about 60% this week topping at around 38…it shrank during the drop so as a contrary indicator could mean a further bounce (from Friday’s lows TSLA-AAPL-PTON-AMD rallied 7% to 13% but S&P & Nasdaq sold off a bit into the close. WE suspect and brought to your attention that sideline investors ($5 Trillion) may be more comfortable in Banks/Health Care/Industrials/Materials…..Value-Dividend payers than speculating about Work From Home/Cloud/5G/Semis that may have to catch up with their valuations…which could take time…..expect a rocky road… consider selling cash puts on VIX spikes like this week on stocks you want to own (big put option selling activity on AAPL & MSFT this week)….but as we told you for a while..SEPT-OCT-NOV….is a potentially VOLATILE time and may not be for the faint of heart….having HEDGES on that puts parameters on your equity seems reasonable….we expect rotations & reversions to the mean…..LT..The Fed says Unlimited QE & no return on mmkt….T.I.N.A lives

Questions or want to learn more? email [email protected]

Stock Market

Well it had to happen at some point..the stuff that had been running since March that we brought to your attention back then ..Tech-Mega Cap Growth Semis & Consumer Discretionary (VGT MGK SMH VCR) had to come back to earth at some point and this week they did this week…S&P 500 came back to it’s former highs at 3390 (actually traded thru it) and if Nasdaq is to do the same we have at least a further 10% drop ahead…the Fed has obscured the real value of many markets with their “intervention”…from Treasuries 180-1 P/E…Investment Grade 50-1 to reputable stocks (AAPL 40-1 LULU 86-1) so anything is possible….we could go back to the highs or a little beyond or test the 50 day on the S&P around 3080 or the 200 day around 2900 so our base case is wide trading range and heightened volatility. Some like money center banks & regionals (VFH & KRE)….a diversified basket of dividend paying stocks (MGV VYM SCHD)….while sectors like REITS Industrials-Small-Mid Cap Value-Materials gain some traction (VNQ_VIS VAW VBR VOE). Our understanding is Quatum Scape is coming to market in Q4 with Bill Gates & VW involved & Michael Jordan (who knows a thing or two about gambling) hooks up with DKNG….Buffett sold another 1/2 of his stake in WFC and may dump the rest (stock rose Friday)…the transports ( FDX UPS UNP) seem to be enjoying big volumes while QCOM & AVGO may be best bets in 5G right now NVDA got hit on overvaluation but on the horizon you’ve got console, cloud, data centers, bitcoin and best yet Sony Play Station is expected to be a rock star when it comes out not to mention business wit EA & Take Two…..Phase 3 Virus trials happening and PFE AZN MNRA are lead dogs…speaking of dogs..Data Dog DDOG hass been hit but some are looking for long term value soon….Biotech is also on the radar as IBB & BIIB are both at junctures as we said epicenter stocks are coming back (CCL just had a cruise to Italy) so Department stores (M KSS JWN) hotels (MAR) Borg Warner had caught a bid…and banks with heavy credit card exposure (C COF) have come back strong….QQQ broke a long term uptrend so we will see if that portends further corrective price action…if you’re long term bullish…selling cash puts on volatility spikes or sell puts/buy calls if you think we are near a turn are strategies to price out….ass we said last week…Caveat Emptor Sep thru Nov

Bond Market

The story here is the steepening of the yield curve despite the drop in stocks which could mean the drop in stocks is over soon or it could mean that the forecast is for economic boom to hit when we get the vaccine. It could also mean that the Fed iss losing control of the long end of yields. Some belive EM bonds offer good value and if you believe in the banks the preferred are worth a look. High Yield bonds lost some ground this week but truthfully; like we told yo last week…the debt market prices are extended and a reversion to the mean started last week. More QE in Sept…well if Powell is doing a reelection troll then expect it & maybe a stimulus package to boot.. .CHina’s talking about selling bonds which also add uncertainty…the 3-5 year duration appears anchored and as we told yyou for many months…limited/short term duration corporates & munis not a bad place to park…long term bonds on the other hand seem like a suckers bet..low yields Mortgages got better news on performance and rates down to 2.85%….low.

US Dollar/International Markets

The Dollar Index hit a 52 week low on Tues at 91.75 but turned around by weeks end to close at almost 93 after having pierced that level. In contrast..the Euro tried to break 120 and failed to sustain it so we went home at 1.18 area…another potential REVERSION TO THE MEAN trade as the 50 day MA is 1.16 area and the 200 day is 1.11 area (just above the 110 area we told you was bullish)…we got a bounce in the Japanese Yen but still under resistance while the Canadian $ remains weak and the Aus $ remains firm….in worldwide stocks (VEU VXUS) not going anywhere and Brazil (EWz) faded off its advance last week….Japan (EWJ) slipped as well…China slide down (FXI) despite good manufacturing news…and in Europe France Spain Germany all gave it back (EWT EWG EWQ)…emerging markets and their debt realtively stable (VWO VWOB)…stay tuned…volatility ahead

Crude Oil/Natural Gas

OK..we told you we were suspicious of Crude prices in the 40’s short term and that paranoia was deemed warranted this week ass we got a nice $5 dollar drop from 44-39….the catalyst was oil rigs counts rose and even a Hurricane couldn’t slow down the refineries but did shut down more than 80% of off shore production in the Gulf of Mexico…longer term into next year we are still constructive on the oil supply / demand dynamic. Natural Gas is a market we have told you about when it broke above 2.00 and has since continued up toward 2.75 (great move) but this week settled at 2.57 so it is extended and could have a pullback but seems like it may want to make a run at the 52 week high at 2.91…a break of 2.43 (weekly low) would hurt. On the stock side..the majors (XOM CVX COP) all got hit and need a good 3% to 10% rise to get going while LNG is at 52 with 50-200 day MA’s around 5o

Gold Silver Platinum Copper Bitcoin

A full slate of Dollar/Inflation Hedges here for you..we told you last week we are in trading ranges which often happens after parabolic moves (like stocks) Gold 2100-1900 Silver 30-24 Platinum 1100-800 and we remain in them albeit testing the lower boundaries. GDX GDXJ SIL SILJ are all on the defensive and we hope to be able to load up before years end at discounted prices to be set up for an advance next year….we’ll see how the cards come out….Copper got above 3.00 and sso far has maintaine it depite housing stocks taking a bit of a hit and lumber prices tanking from 934 to 781 before rebounding to 875…wild ride….Bitcoin has been volatile from around 13 grand to 10 grand and closing at 10600…look into GBTC for exposure.

Soybeans Sugar Coffee

OK!! Last week we told you are patience paid off in Beans ass the broke 9.50 and ran to 9.67…so this week we maintained and added a few cents…now the hard part 10.00…can we do it..we’ll see but so fat the move out of the 8 range has been welcome….now the patience for Sugar has NOT been rewarded as the fade off 13 has taken us under 12.50 (not good) and truthfully the land of milk & honey is on the other side of 13 so something feels wrong here unless we can regain upside momentum. Coffee ass we told you was a buy under 100 and then again on a pullback to 110…this week we saw a RUN up to the highs of 135..a real winner and while we are extended…right now no evidence of a turn down-let it ride on a short leash

REMEMBER… There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage firm/broker/advisor to determine your own suitability. Past performance is not necessarily indicative of future results. Use Risk Capital Only