- the source for market opinions


June 27, 2020 | Trading Desk Notes June 27, 2020

I trade futures and options for my own account. My initial time horizon for a trade is usually a few days to a few weeks. Sometimes, if my view of the market is working I will maintain a position for months. I believe net profits over time come from disciplined risk management…not from having a great […]

June 20, 2020 | Trading Desk Notes June 20, 2020

Markets currently seem to be highly correlated into a simple “risk on / risk off” dichotomy…with the emini S+P futures leading the way while other markets follow. If the spuz is bid then WTI catches a bid while the USD and bonds are offered…and vice versa. The tricky thing with trading off inter-market correlations is […]

June 13, 2020 | Trading Desk Notes June 13, 2020

I thought the stock market’s huge rally off the March lows was a bear market rally because of the huge dis-connect with the real economy. I thought demand destruction was so powerful that stimulus from the Fed and the government was only going to keep the economy from falling into a depression…not turn it around. I […]

June 6, 2020 | Trading Desk Notes June 6, 2020

A Key Turn Date occurs when a number of different markets all reverse direction at the same  time…giving us a very valuable window into market psychology. At the risk of being scorned by psychologists I’d say that a KTD may be an example of synchronicity in the markets…when “meaningful coincidences” are a  manifestation of some […]

May 30, 2020 | Trading Desk Notes May 30, 2020

My bias is that the 20% rally in the S+P from October 2019 to February 2020 may have been a “blow-off top” to a 10 year bull market. (I see Tesla running from ~$250 to ~$950 as the poster child for the Irrational Exuberance of that time.) The virus set off a “tumbling dominos” decline from the […]

May 23, 2020 | Trading Desk Notes May 23, 2020

I’ve been trading small size with tight stops. Choppy price action keeps my conviction level low. My bias is that demand destruction has been incredible…with a good chance that it gets worse before it gets better…so I think this is bear market rally…but I have to respect the fact that risk assets won’t break down. This […]

May 16, 2020 | Trading Desk Notes May 16, 2020

The Nasdaq 100 surged 9% into Monday’s highs on the back of 6 consecutive up days…but then it wobbled a bit…maybe due to rising US/China tensions…maybe due to fatigue after “too far / too fast”…maybe due to the wake up calls from Druckenmiller and others…or maybe it was just the “pause that refreshes” and the […]

May 9, 2020 | Trading Desk Notes May 9, 2020

Stock market indices rallied this week…lead by the Nasdaq index which is now up ~4% YTD after being down ~25% YTD at the March lows…volatility metrics keep falling and the open question is, “How will the “re-opening” play out?”     Stock market investors seem to be anticipating that the “re-opening” will play out just fine. Massive […]

May 2, 2020 | Trading Desk Notes May 2, 2020

Overextended markets are especially vulnerable to exogenous shocks. The stock market was especially vulnerable to the virus shock in February 2020 after a 45% rally off the Christmas 2018 lows to All Time Highs…with half those gains coming in just the last 5 months as millions of new  “commission free” retail accounts piled into the market […]

April 25, 2020 | Trading Desk Notes April 25, 2020

Massive monetary and fiscal stimulus in March and April will “counter” the deflationary surge to some extent…but it’s not a one-for-one “offset”…the deflationary impulse will be sustained…will be pervasive and enduring. For the past 20 years we’ve been trained to believe that stimulus can “turn things around”…so equity speculators have been BTD lately…but bonds, commodities […]

April 18, 2020 | Trading Desk Notes April 18, 2020

Nasdaq 100 futures went green YTD this week…up ~35% from their March 23rd “max panic” lows…while the Russell 2000 is still down ~25% YTD even though it rallied ~30% from its March lows. This is a classic inter-market relationship…tech stocks (and especially the Big Names) have blown away small caps since the “V” shaped recovery began […]

April 11, 2020 | Trading Desk Notes April 11, 2020

It’s all about the Fed. If you wonder why we’re seeing such a HUGE divergence the past 3 weeks between the economy and where investor psychology has taken the market…just remember…the Fed said they would do whatever it takes…did you think they were bluffing? They were back in this morning with another $2 Trillion program to […]

April 4, 2020 | Trading Desk Notes April 4, 2020

Has the stock market bottomed? I don’t know…but I know why you’re asking. But…but the major indices fell so far so fast…they threw the baby out with the bathwater. This has got to be a once-in-a-lifetime buying opportunity!  Maybe. Markets were over-leveraged / priced for perfection in February and then the virus came along and set the dominos […]

March 28, 2020 | Trading Desk Notes March 28, 2020

When I get a trade idea my first question is, “How much of this idea is already in the market?” For instance, if I consider that the “virus news” could get worse next week I ask myself, “To what degree have the people who move markets already taken this idea into account? To what degree does […]

March 21, 2020 | Trading Desk Notes March 20, 2020

Leverage is being punished these days…as recently as last month it was being celebrated. During a decade of low interest rates and easy money folks levered up and reached for yield. That worked out great so they did more…but apparently they overdid it…so now the “liquidation” phase has kicked in and the talk is of counterparty […]

March 14, 2020 | Trading Desk Notes March 14, 2020

Volatility surged higher across markets this week…prices changed with astonishing speed…bid/offer spreads were ridiculous…credit spreads widened with a vengeance and depth-of-markets got scary thin. Global stock market cap tumbled >$16 Trillion in 3 weeks…more than China’s annual GDP.   The US Dollar soared this week as stock markets tumbled. The CRB commodity index fell to a […]

March 7, 2020 | Trading Desk Notes March 7, 2020

At market extremes you are trading nothing but psychology. So…is it time to sell panic? Or is the hysteria just beginning?  What’s your time frame? What’s your pain threshold? Volatility has exploded as liquidity has vanished. Bid/offer spreads are wide but not deep. Credit spreads are widening. The 10 year UST yield has dropped from ~1.6% […]

February 29, 2020 | Trading Desk Notes February 29, 2020

The stock market surged to All Time Highs the first 2 weeks of February…ignoring red flags from the bond market, the US Dollar and gold…but the day of reckoning finally arrived and the market crashed with astonishing speed and determination. Waves of selling triggered more selling and prices tumbled like dominos.   Volatility ripped higher…a […]

February 22, 2020 | Trading Desk Notes February 22, 2020

Starting January 24th the S+P futures closed red for 3 consecutive Fridays…fearing bad virus headlines over the weekend…but this past Valentines Friday (ahead of a 3 day weekend) the S+P futures closed green…not exactly an “all clear” signal but at least “an indication” that the market was pricing less fear. That sanguine S+P pricing revealed more […]

February 15, 2020 | Trading Desk Notes February 15, 2020

Commodities have been hammered since the virus became front page news…but bonds, gold, the US Dollar and stocks have all rallied…which begs the question, “Are markets anticipating a global economic slowdown exacerbated by the virus…or are they looking past that and anticipating massive fiscal and monetary stimulus?” Fears of a dramatic fall in Chinese demand […]

February 8, 2020 | Trading Desk Notes – February 8, 2020

Emotional reactions to Coronavirus headlines churned price action across markets the past 2 weeks. This week, in lieu of my usual Trading Desk Notes I’ve attached the Power Point – and my opening remarks – that I will be presenting at the World Outlook Financial Conference February 7th in Vancouver, British Columbia.  The theme of […]

February 1, 2020 | Trading Desk Notes February 1, 2020

Market psychology turned decisively “risk off” this week with many global stock indices hitting YTD lows…the “looming recession” idea is back in vogue as analysts factor in the knock on effects from the coronavirus hitting an already weak global economy.   Last August the major American stock indices broke down from ATH when the “looming recession” idea […]

January 25, 2020 | Trading Desk Notes January 25, 2020

The major North American stock indices hit ATHs this week…initially shrugging off virus concerns…but when the virus headlines became increasingly scary ahead of the weekend stocks and commodities fell while bonds, bullion, the US Dollar and the Japanese Yen rallied.   Given the tremendous run in stock indices over the past few months this week’s correction […]

January 18, 2020 | Trading Desk Notes January 18, 2020

The major stock indices continued their relentless rally this week…and I got myself into a frustrating trader’s dilemma. It’s funny now…and I’m sure any traders reading this will be thinking, “Yep…been there…done that,” but it sure wasn’t funny while it was happening! I’ve had a “bias” that stock indices were “stretched” and I’ve looked for opportunities […]

January 11, 2020 | Trading Desk Notes January 11, 2020

Dramatic market price action on Tuesday evening Jan 7/2020 created important Pivot points across a number of key markets…especially gold. Look at it this way…gold rallied ~$125 in 9 days leading up to and including Jan 7…it rallied ~$40 in the last 1 ½ hours to hit a 6 ½ year high at $1,613 (basis Feb […]

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