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TraderRob

 
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  • How Much Longer Will S&P Rally Go? [View article]
    no transparency = markets in control

    highly indebted banks = share prices at the mercy of bond markets, bond markets then control rating agency (not the other way around)

    No one is disagreeing that there won't be a meaningful recovery. But it's clear that this recovery was stimulated in part by stimulus, but mainly by capitulation at 666 SPY. Since then, the self fulfilling prophecy of more equity in the private sector coffers via share prices rising has led to a moderate real recover amidst a market surge. Now we see the redirection of said surge as capitulation to the upside has been witnessed.

    Look for black swans, the fundamentals don't matter one bit. Pull up econ data from past 4 weeks and compare to markets. TONS of down days on upwards surprises and vice versa. Study your charts.
    May 27 06:37 PM | 2 Likes Like |Link to Comment
  • How Much Longer Will S&P Rally Go? [View article]
    Brett I think anyone who says the market is giving "head fakes" right now has been either asleep or disenchanted for much of the past month. Clearly sovereign debt/ sovereign CDS markets have been "making the news" for all of the month of May. Looking at the technicals it's clearly a matter of momentum based around the underlying volatility of sovereign debt. LIBOR is at almost yearly highs and the financing picture in Europe hasn't changed one bit!

    Just read the headlines in Bloomberg to realize it's all about the markets right now. They literally read, "market sells off on sovereign debt fears", "MSCI world equities gain on Greece fears subsiding"...that is markets making the news.

    It's definitely time to put some orders on the books at resistance levels to short Oil and SPX and go long the VIX and Gold at Support. We also like a medium term play in TYO (shrt U.S. 10 yr notes), since it's trading well below average given the sell off and provides some protection to your shorts.

    Check us out at www.diamondslice.com
    May 27 06:20 PM | 2 Likes Like |Link to Comment
  • Today in Commodities: Are We Standard, Or Poor? [View article]
    Hey Matt, I see WTI heading towards $75 as well, but that will be the high end of a range trending lower. Anything near $75 should be seen as a short opportunity for crude. This market is giving barely any time to get short as sentiment SHIFTS to a cyclical bear market. That's right we said it. The is NO good outcome in Europe, so we're expecting a black swan there in a matter of time. Use pops to short production input commodities and U.S. equities while going long Gold and the VIX.
    May 26 05:11 PM | 2 Likes Like |Link to Comment
  • Correction or Bear Market? [View article]
    The new corrections are to the upside... get short on pops here... nothing has changed, there is no tangible EU plan (only promises from disunited leadership, and fresh meat leadership for that matter). Should Korea tensions ease, we'll see some return to risky assets. Use this time to go short Crude and the SPX and Long Gold and the VIX. Also it's looking like a good time to get short the U.S. 10 yr.

    Check out our analysis for some good vehicles to go short the U.S. 10 yr using ETNs @ www.diamondslice.com
    May 26 11:00 AM | 1 Like Like |Link to Comment
  • Major Depression in Greece Likely - Interview With Marc Chandler [View article]
    Austerity measures are sure to bring the Greeks to their knees, but it won't be as ugly as the alternative... they get the funding and keep the pay hikes that Papandreou got elected on. They'll probably end up with something in between the two and the Euro will take the heat.
    May 26 10:57 AM | 2 Likes Like |Link to Comment
  • Korea Outlook: North Korea Attack, Economic Data to Move KOSPI [View article]
    For those who are interested, here's a recapped timeline of the conflicts from 1953 to present...

    1969 – U.S. reconnaissance plane shot down.
    1994 – Kim Il-sung dies, freezes nuclear program in exchange for 2 nuclear reactors and $5 billion. worth of nuclear fuel.
    1998 – North Korea fires missile over Japan.
    2000 – Kim Jong-il and Kim Dae-jung shake hands at summit in Pyongyang.
    2002 – (June) North and South vessels battle in Yellow Sea; 30 N. Korean & 4 S. Korean soldiers die. (December) The North reactivates Yongbyon reactor. International inspectors are thrown out.
    2003 – The North makes claims it has enough plutonium to make a nuclear bomb.
    2005 – The North claims it has built nuclear weapons for self defense.
    2006 – North Korea tests nuclear weapon for the first time.
    2007 – Pyongyang commits to disabling three nuclear reactors. Talks to formally end the war.
    2008 – President Lee Myung-bak inaugurated in the ROK. North-South relations deteriorate sharply: North test fires short range missiles, accuses President Lee of sending navy across border.
    2009 – (January) North accuses Seoul of “hostile intent”. (April) North launches long range rocket, walk away from “six-party talks”. (May) North says it is no longer bound by 1953 truce. Carries out underground nuclear test. (June) U.S. journalists sentenced to 12 years hard labor. North responds to sanctions threats, claiming them as an “act of war”. (August) Bill Clinton negotiates the release of the U.S. Journalists; tensions ease.
    2010 – South Korean warship, Cheonan, sinks after explosion, killing 46 soldiers. The South officially accuses the north of firing a torpedo from a mini sub, sinking the ship. Kim Jong-il accuses the south of declaring war. President Lee orders South Korean shipping lanes closed to the North and trade of any kind to be suspended, while making threats to fire on any vessel that enters the South’s territories.

    The discussion here is really well supported, so hopefully this timeline can keep it alive, thanks...
    May 26 10:07 AM | Likes Like |Link to Comment
  • Korea Outlook: North Korea Attack, Economic Data to Move KOSPI [View article]
    Thank you for pointing out the errors. My apologies, we submitted this one in a bit of a frenzy. We're working with SA to get it corrected. Thanks again for your commitment to accuracy.
    May 24 11:53 AM | Likes Like |Link to Comment
  • Is Greek Contagion Crushing Crude? [View article]
    Thanks again for your input Chris. You clearly intimately understand the inner workings of commodity linked ETF's. I was not aware of the activities regarding producers lending rights to ETF's for short term financing, and I can see how this may increase volatility. I'd like to say for the record, I by no means think that an ETF is some sort of actively managed fund seeking to "play" the market, as you somewhat allude to. Clearly an ETF is a vehicle with the sole intended purpose of mimicking the price movements of the respective asset.

    I'd like to also point out that I'm not the first to site ETF's as a source of potential volatility for one main reason. ETF's give individuals and smaller scale wealth managers a far more liquid and far more accessible avenue to speculate on the price movements of commodities. It would be obtuse to suggest that the introduction of ETF's has not in the least increased the trading volume of commodity options and futures. The ETF has created "access" to items previously traded only by institutions and high net worth individuals.

    So then if you can agree with me on this point, you are suggesting that the addition of so many smaller players to the poker table would increase, decrease, or have no effect on the volatility of the price of the targeted assets?
    May 13 06:28 PM | Likes Like |Link to Comment
  • The Fannie-Freddie Housing Subsidy [View article]
    The real issue with fannie and freddie being a part of the government balance sheet as an official budgeted item, is that the value of their assets (or should I say liabilities) are still now valued incorrectly. Foreclosures and delinquencies are going to snarl and thrash away at the crippled builders and developers who have just now plateaued near record low growth rates and prices. The stimulus is over in housing and the mob will lynch the senate before another is passed.
    Just how long will it take moody's, S&P, and the rest to nock the stars and stripes down a peg or two? In our opinion... less long than it will take for our economy to recover. Can anyone remember what a downward spiral feels like? This rally is nothing more than a morning joint after a binger, while the high will soon wear off and as our consciousness returns we will remember that debt doesn't disappear, and that it's wrath is merciless.

    See what our full content can do for your perspective at www.diamondslice.com
    May 12 11:36 PM | 4 Likes Like |Link to Comment
  • Face It, Fannie and Freddie Belong in the Government Budget [View article]
    The real issue with fannie and freddie being a part of the government balance sheet as an official budgeted item, is that the value of their assets (or should I say liabilities) are still now valued incorrectly. Foreclosures and delinquencies are going to snarl and thrash away at the crippled builders and developers who have just now plateaued near record low growth rates and prices. The stimulus is over in housing and the mob will lynch the senate before another is passed.

    Just how long will it take moody's, S&P, and the rest to nock the stars and stripes down a peg or two? In our opinion... less long than it will take for our economy to recover. Can anyone remember what a downward spiral feels like? This rally is nothing more than a morning joint after a binger, while the high will soon wear off and as our consciousness returns we will remember that debt doesn't disappear, and that it's wrath is merciless.
    May 12 10:02 PM | Likes Like |Link to Comment
  • The EU Bailout: Too Much, Too Late [View article]
    Who's the lender of last resort here? In TARP an external entity to the problem, the U.S. government, bought the bad debts of the banks until the market returned and a fair value for the assets was determined. A crash of sovereign EU state debt would not be solved by this plan, because it is the EU states themselves who are pledging to back the "investors" of these additional 440 billion in debt offerings. Sure Germany and France can keep the thing spinning for a while, but they all share a currency so the downward spiraling self fulfilling prophecy will then begin... Investors sell the bonds they hold because unknown risks in certain states remain too uncontrollable and the prices are falling... As bond prices fall, ratings decrease, currencies become devalued due to a necessity to print more euros, and on and on it goes.

    Some will claim that the IMF is the lender of last resort. However, in the current plan, the IMF is commiting 250 billion USD worth of their Special Drawing Rights units (SDRs), which conveniently equates to the ENTIRE current lending capacity of the IMF. So what happens if developing Asian countries with similar issues catch the Aegean virus and need the IMF for what it was designed to do? Well sports fans, that's when the proverbial sink would have come in handy...

    Check out our analysis of the issue, where we call into question the ability of the IMF to combat a EU wide crisis, using some simple math and common sense @ www.diamondslice.com/2.../
    May 12 09:52 PM | 1 Like Like |Link to Comment
  • Today in Commodities: Slaughterhouse Blues [View article]
    Hey Matt, nice work as usual... The issue is that Oil and Gold are diverging again, and charts are screaming to get short Oil in a big way. We were short in the mid $85 range and after the divergence of crude from equities, which we have seen in the past few sessions for the first time in a LONG time, there is no reason for crude to remain above $80. We're adding to our shorts! It may seem crazy to some, but it's clear that the China situation is a dismal one and the CDS & LIBOR spreads are saying uhhohhh to the recovery rally in stocks and EU sovereigns.

    Take a look at our recent crude report if you're interested @ www.diamondslice.com/2.../
    May 12 06:27 PM | 3 Likes Like |Link to Comment
  • Greek Bailout Plan Increased by a Factor of Five [View article]
    Indeed it is near $1 Trillion. Don't feel bad that you can't keep up with the re-raises Mark, I know the feeling. CDS vs EU are now going head to head at the finals table of the Planet Earth Financial Solvency Championships. This all in move by the EU is definitely looking like a bluff from where I'm sitting. Uhhh ohhh and the pocket cam confirms it is indeed a bluff. Ace two off suit... ouch, I hope CDS takes the bait, or things are going to get messy.

    Wrap your head around the developments in the UK and German elections, EU Debt Purchase Plan (TARP 2.0), and U.S. Econ data with the WEEKLY SPECTRUM @ www.diamondslice.com/2.../
    May 10 03:59 AM | 5 Likes Like |Link to Comment
  • $645B Greek Bailout Plan: Market Soars [View article]
    Lot's of good points here... Tarp 2.0 Euro edition is certainly going to take some time for the pudding to prove anything, but this week should get a sigh of relief early on.

    Get an update on the EU Debt Purchase fund, Geopolitical Risks tied to Elections in the UK and Germany, and an update on U.S. Macro Econ Data at www.diamondslice.com/2.../
    May 10 03:39 AM | 1 Like Like |Link to Comment
  • Is Greek Contagion Crushing Crude? [View article]
    Thanks Chris for the input. Your explanation of Commodity ETFs and ETNs is indeed a good one. Taking it one step further, ETFs are actually borrowing the rights for delivery of the commodity and never the commodity itself, therefore they represent a new party in the market of commodity futures/options and specifically a party which never intends to hold contracts through till delivery/expiration. Wouldn't then ETFs allow otherwise unvested parties to climb in and out of commodity speculation without the risks associated with direct futures purchases? To me this seems like a clear source of added volatility as a result of speculation. This isn't bad, but it should be at a minimum respected imho.
    May 10 12:40 AM | Likes Like |Link to Comment
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