Global Macro Trading Journal

Quote from Ghost of Cutten:

I think gold is very close to a short-term low (tomorrow morning is most likely time for it IMO), and will see >$1400 in the next few sessions. I'm playing it with front month calls just in case the crash continues further.
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I wake up and gold is up $70 off the lows, damn, what a missed opp
 
I continue to watch Apple fall - losing money yes, but far more bemused than upset, still remembering what an ass this GoC guy made of himself a year ago when I suggested WMT was the better investment.

https://www.google.com/finance?chdn...E:WMT&ntsp=0&ei=4zVwUaCtJceM0QHYWg&authuser=1

Markets are endlessly fascinating and the Apple story is one for the books. I've done the anti-Peter Lynch, disposing of my WMT and holding onto Apple.

I would urge everyone to use the near-10% correction in BAC to pick up the TARP warrants on the stock. AIG warrants were being given away until recently, but have had a nice run.
 
Quote from horton:

Quote from Daal:

I'm going defensive here.

JPY held offer at 100 supports this stance near term. JPY held bid at 100 would invalidate.
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JPY held offer at 100 retest appears in play. Risk on IMO if JPY 100 held bid.
 
Herding
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I can find two explanations for this, the end of the great moderation and the speculation mindset that investors have been taking on due QEs
 
Quote from Daal:

I can find two explanations for this, the end of the great moderation and the speculation mindset that investors have been taking on due QEs
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Consider the role of algorithmic manipulation by the largest participants in the intraday structure as enhanced by intraday qe operations. My ability to anticipate intraday structure has greatly improved by adopting this mindset.
 
Quote from horton:

JPY held offer at 100 retest appears in play. Risk on IMO if JPY 100 held bid.
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JPY 100 Failed Offer. Observe for JPY 100 Held Bid. Major test of this rally is in play now.
 
http://online.wsj.com/article/SB10001424127887324744104578475273101471896.html

Reverse Tepper principle?
Things continue to be fine(strong economy or ok economy) = fed talks hawkish, stocks tank
Things go bad (economy weakens) = stocks tank, then after 10-15% correction, Fed comes to the rescue

The issue could be that stocks might hold if things go bad because of the perception that the Fed will always rescue. But that perception could be wrong because a stock decline might be NEEDED for the Fed to 'wake up' and do something about it, its easy to get complacent with stocks at highs
 
Quote from Daal:

http://online.wsj.com/article/SB10001424127887324744104578475273101471896.html

Reverse Tepper principle?
Things continue to be fine(strong economy or ok economy) = fed talks hawkish, stocks tank
Things go bad (economy weakens) = stocks tank, then after 10-15% correction, Fed comes to the rescue

The issue could be that stocks might hold if things go bad because of the perception that the Fed will always rescue. But that perception could be wrong because a stock decline might be NEEDED for the Fed to 'wake up' and do something about it, its easy to get complacent with stocks at highs
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The boogeyman lurking in the background here is margin compression driving a fall in corporate earnings - which on a cyclical basis seems inevitable, and in fact Q3 and Q4 of last year saw contractions in earnings on an annual basis.

Congress can re-inflate margins by increasing the deficit (assuming wage growth remains stagnant) but the Fed cannot. The Fed can try to boost P/E ratios to compensate, but this can only go so far.
 
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