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During the twelve months of 2020, PAM delivered phenomenal real-dollar trading performance, the best at Seeking Alpha:
PAM's flagship Swing Portfolio, year-to-date (December 31, 2020) delivered $100, 181,522.77 net profit on $11,172,813 operating capital.
Year-to-date performance: 754.20%, on 888-98 win-loss trades.
December 2020 spreadsheet here:
Year to date 2020 spreadsheet here.
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JANUARY 4, 2020
GOOD MORNING ASIA / GOOD EVENING WEST COAST
robert.p.balanModeratorLeaderOwnerJan 4, 2021 5:24 AM
The new year is starting out fine for the long trades. The yield has likely completed a mid-way correction and should be headed for the recent highs in 10 yr yield.
As we described on Dec 31 (chart provided below) -- we could be facing an ascending wedge (green lines) or a triangle (red lines) in the chart above.
Nothing has changed from the December 31 illustration (see above chart).I discussed a dream that I had after posting the 2021 PAM outlook, and it seems to me that the dream was pointing to a wedge, rather than a triangle -- although that was applied to the the YM chart.
You will note that the wedge would end the current yield rally (which presumably would end the equity rally too) earlier than a triangle would do.If the ascending wedge wins out, then we indeed could just see a few days of rising yields and equities. We will be on a special lookout for that. The top could come this week.
federergoatJan 4, 2021 5:38 AM
Hey Robert, would it be possible for you to do an update on gold?
robert.p.balanModeratorLeaderOwnerJan 4, 2021 5:42 AM
That could be an NQ EWP to be on lookout for.
federergoat
So far, this old EWP schemata is still looking good, chart below.
I posted that on Dec 29. Lets see if it remains relevant.
This may complete the rally in the +C+ wave of the inverse irregular depicted on the chart previous to the one just above.
Keep your gold longs -- we might just hit 2000 again in GCG1, and also could come in just a few days.
Keep a very close watch on yield progress -- the long bond yield holds the key over the next few days. The models suggest a sharp rally to the boundaries.
robert.p.balanModeratorLeaderOwnerJan 4, 2021 6:07 AM
OK gals/guys -- NY trade should bust the wave 4 consolidation patterns wide open.
I will see you in Europe trade in three hours. GN everyone.
GOOD MORNING EUROPE / GOOD EVENING WEST COAST
robert.p.balanModeratorLeaderOwnerJan 4, 2021 10:05 AM
PAM RESETS BUYS 500 CONTRACTS OVERHEDGE OF NQH1 AT BREACH OF 12,917 TOP (FROM 12,905), GTC
*This order was filled.*
*NQH1 -- DONE AT 12,919 BOUGHT 500 CONTRACTS NQH1 TO RESET PART OF OVERHEDGE, FOR ALL FUNDS*
PAM BUYS 500 C0NTRACTS ESH1 AT 3673 OR LIMIT BETTER OR AT BREACH OF 3705, OCO, GTC -- ALL FUNDS.
*This order was filled.*
*ESH1 -- DONE AT 3672.25 BOUGHT ANOTHER 500 CONTRACTS NQH1 AS OVERHEDGE -- FOR ALL FUNDS*
The 10yr yield is flying --- should be good portents for the early part of NY trade today.
robert.p.balanModeratorLeaderOwnerJan 4, 2021 5:03 PM
*Yield decided to retest its bottom, and so equities also doing the same thing. Its the irregular correction at work,*
*We still have extra margin which was freed when we took profits on some of the overhedges. The bottom of the irregular may be an appropriate place to put that margin capital to work.*
The RobinHooders are suddenly skittish -- they suddenly became weak hands.
robert.p.balanModeratorLeaderOwnerJan 4, 2021 5:24 PM
The yield may have bottomed.
But we put in a low bid and a breakout bid
all PAM BUYS 500 C0NTRACTS NQH1 AT 12,680 LIMIT OR BETTER OR AT BREACH OF 12,750, OCO, GTC -- ALL FUNDS. -- SHOULD HAVE BEEN 12,650 FOR A LOW BID -- TYPO
all PAM BUYS 500 C0NTRACTS ESH1 AT 3673 OR LIMIT BETTER OR AT BREACH OF 3705, OCO, GTC -- ALL FUNDS.
User.49362576Jan 4, 2021 5:48 PM
Could you clarify if limit order is at 3673 or 3683?
robert.p.balanModeratorLeaderOwnerJan 4, 2021 5:50 PM
The low bid is at 73 (hence low)
But its a crap shoot- 73 might be too greedy. you can do 83, and it does not matter much
robert.p.balanModeratorLeaderOwnerJan 4, 2021 6:06 PM
Look like now is a good time to get rid of this wayward, short RTY hedge.
all PAM BUYS BACK 2500 CONTRACTS RTYH1 AT 1915 LIMIT OR BETTER, OR AT BREACH OF 1945, OCO, GTC -- ALL FUNDS
robert.p.balanModeratorLeaderOwnerJan 4, 2021 6:49 PM
PAM BUYS 500 C0NTRACTS NQH1 AT 12,680 LIMIT OR BETTER OR AT BREACH OF 12,750, OCO, GTC -- ALL FUNDS. -- SHOULD HAVE BEEN 12,650 FOR A LOW BID -- TYPO
*This flawed order was filled by DCC at the right level. You will crucify me for this but I meant 12,650 for a low level bid (not 12680 which was the low). I have to reflect the price which DCC has on the books.*
*NQH1 -- DONE AT BETTER -- 12,647 BOUGHT 500 MORE CONTRACTS NQH1 AS OVERHEDGE -- FOR ALL FUNDS.*
PAM BUYS 500 C0NTRACTS ESH1 AT 3673 OR LIMIT BETTER OR AT BREACH OF 3705, OCO, GTC -- ALL FUNDS.
*This order was filled.*
*ESH1 -- DONE AT 3672.25 BOUGHT ANOTHER 500 CONTRACTS NQH1 AS OVERHEDGE -- FOR ALL FUNDS*
robert.p.balanModeratorLeaderOwnerJan 4, 2021 7:42 PM
PAM BUYS BACK 2500 CONTRACTS RTYH1 AT 1915 LIMIT OR BETTER, OR AT BREACH OF 1945, OCO, GTC
*This order was filled. *
*RTYH1 -- DONE AT 1945.7 BOUGHT BACK 2500 CONTRACTS RTYH1 TO EXIT THE SHORT HEDGE OF THE LONG OVERHEDGES AT 2005.3/2013.7/2016.8 *
JANUARY 5 2021
GOOD MORNING ASIA / GOOD EVENING EAST COAST
robert.p.balanModeratorLeaderOwnerJan 5, 2021 2:44 AM
What's the difference between the two purple boxes -- Nothing. Both of the EWP structures are irregulars with the long tail -- the guys with the long mullet.
robert.p.balanModeratorLeaderOwnerJan 5, 2021 2:52 AM
If there are no more declines in yields, then we begin the countdown for the ascending wedge (blue lines) or the triangle (red lines), see chart above. .
robert.p.balanModeratorLeaderOwnerJan 5, 2021 2:56 AM
GCG1 now in extended third wave of wave 3 of Wave +C" of an inverse irregular.
Translation -- we may see 2000 again, even higher.
robert.p.balanModeratorLeaderOwnerJan 5, 2021 3:05 AM
That humongous surge in TCB highlighted by Mr. Alan Longbon should kick yields in the back pants / ass in a day, even later today -- then fade out (top out) after another day or two (TD 160 -- 4 TDs from today including today)That should pull up equities too. So be on the lookout for a yield/equities top by Friday, latest Monday.
robert.p.balanModeratorLeaderOwnerJan 5, 2021 3:21 AM
The SPX Fed SOMA Transactions Model (Fed Balance Sheet) have an equities peak by Tuesday/Wednesday next week -- late vs a yield top. But not surprising. Equities lag behind yields by a day or so during crucial inflection points.
Nota Bene:
The bloggers/pundits call the sell off Monday nervousness over a Blue win in Georgia -- that was quite a stretch and a laugh -- a Blue sweep in Georgia means another $2.5 trillion more in ab nihilo money, in addition to the $3 trillion already docked. How bad can that be for equities?
But this is what Tim and I saw.
Nesting of Systemic Liquidity "wells" and SPX performance (watch the first difference change rate)
Nesting of Systemic Liquidity "wells" and 10Yr Yield performance (watch the first difference change rate)
robert.p.balanModeratorLeaderOwnerJan 5, 2021 3:49 AM
Looks like further action has to await the MOTUs if they come out to play in two to three hours. I will just enjoy the spectacle when I come back to the fray in a few hours,
GN everyone. I see you in Europe trade in a few hours.
GOOD MORNING EUROPE / GOOD EVENING WEST COAST
robert.p.balanModeratorLeaderOwnerJan 5, 2021 10:21 AM
These are the real, professional economists you should be reading when it comes to tracking the US GDP growth;
Business Cycle Indicators, January 4th
Risks of a Double Dip Rising? [upated]
Ignore narratives that are not substantiated (frequent transgression of some Seeking Alpha authors). Demand hard, real-time data.
robert.p.balanModeratorLeaderOwnerJan 5, 2021 10:53 AM
The 10yr yield is finally on the rise, from support areas provided by either an ascending wedge or a triangle. Our bond trading portfolio is evenly hedged -- that leaves a lot of margin capital which can be used -- and so decided to add some "scalper" TN short positions -- you don't have to do this is you are not comfy with TN short term trading. And the margins required are large.
all PAM SELLS 288 CONTRACTS OF TNH1 SCALPERS, AT DCC DISCRETION, ALL FUNDS ---- (DCC WILL GIVE ME A QOUTE AND THEY EITHER PUT THE TRADE IN THE JOINT ACCOUNT OR UNLOAD IT TO THE MARKET OR ON THE PB -- THEIR CHOICE). * Rating: 3 out of 5*
*TNH1 -- DONE AT 156-1.5 SOLD 288 CONTRACTS OF TNH1 FOR ALL FUNDS*
robert.p.balanModeratorLeaderOwnerJan 5, 2021 12:55 PM
*We now start putting a trail stop to our massive long Gold exposure, now that there is a slot of blue sky between acquisition price and market price.*
all PAM PUTS AN INITIAL TRAIL STOP TO THE 1500 CONTRACT LONG GOLD EXPOSURE, SELLS (TO EXIT) 1500 GCG1 AT BREACH OF 1915, GTC -- ALL FUNDS
flytightJan 5, 2021 1:26 PM
robert.p.balan I just love your initial three charts this morning Robert. I will post my observations at PM. Thank you as always.
robert.p.balanModeratorLeaderOwnerJan 5, 2021 4:05 PM
Two US Dollar DXH1 charts:
robert.p.balanModeratorLeaderOwnerJan 5, 2021 4:06 PM
Terminal descending wedge likely forming. The bottom of the DXH1 should correspond to a top in equities and yields.
PAM buys large in DXH1 at circa 89.3 - 89.3 if we see those levels.
I sense changing equity market sentiments -- it used to be (until Dec 31) that a decline in yields tend to elicit meager response from equities. Now small yield downticks beget exaggerated equity declines. Cuidado.
robert.p.balanModeratorLeaderOwnerJan 5, 2021 5:50 PM
Yields are off to the races - now we get to see a wedge or a triangle.
robert.p.balanModeratorLeaderOwnerJan 5, 2021 6:59 PM
*Its time to put a trail stop to the short TNH1 we just opened a few hours ago.*
We will not take a loss on this trade, a little profit at least.
all PAM BUYS BACK THE 288 CONTRACTS SHORT TNH1 SCALPERS AT UPWARDS BREACH OF 155-28 (TO START WITH), SOLD AT 156-1.5, GTC -- ALL FUNDS
Accountant just reminded me that the large long RTY overhedge is now naked. We cashed in on the short hedge, if you remember.
*So to keep him from having nightmares, I will put a potential short hedge some distance from current market.*
all PAM SELLS 2500 CONTRACTS RTYH1 AS SHORT HEDGE FOR CURRENT LONG RTY OVERHEDGES, AT BREACH OF 1950, GCT, ALL FUNDS
If the market moves higher some more, I will put back the short hedge where we used to have it, at 1962.27. That means we get to keep the $2,071,250.00 cash out from the previous short hedge, for free. Sometimes hedges work beautifully, if you have a market that trades sideways.
robert.p.balanModeratorLeaderOwnerJan 5, 2021 8:19 PM
*Now we can put the short hedge back at 1962.27 -- even if the market comes off now, we still get to keep the $2,071,250.00 cash out on the previous short hedge.*
PAM SELLS 2500 CONTRACTS RTYH1 AS SHORT HEDGE FOR CURRENT LONG RTY OVERHEDGES, AT BREACH OF 1950, GCT,
*Modify this to:*
all PAM SELLS 2500 CONTRACTS RTYH1 AS SHORT HEDGE FOR CURRENT LONG RTY OVERHEDGES, AT BREACH OF 1963 (FROM 1950, GCT, ALL FUNDS.
robert.p.balanModeratorLeaderOwnerJan 5, 2021 8:35 PM
*We now protect these long overhedges with trail stops looking for small profit at the start.*
all PAM SELLS (TO EXIT) 500 CONTRACTS ESH1 LONG OVERHEDGE AT BREACH OF 3700, FOR ALL FUNDS.
all PAM SELLS (TO EXIT) 500 CONTRACTS NQH1 LONG OVERHEDGE AT BREACH OF 12,700, FOR ALL FUNDS.
robert.p.balanModeratorLeaderOwnerJan 5, 2021 9:52 PM
all PAM PUTS IN GENERAL SHORT HEDGE JUST TO MAKE SURE WE WILL NOT BE CAUGHT UNAWARES BY GEORGIA SENATE ELECTION RESULTS; SELLS 2500 CONTRACTS ESH1 AT DOWNWARD BREACH OF 3650, GTC -- FOR ALL FUNDS
robert.p.balanModeratorLeaderOwnerJan 5, 2021 10:04 PM
GN gals/guys .. See you in Asian trade, overnight.