Yahooligans

With China’s market going stark-raving mad, it’s interesting that king-of-kings Alibaba is struggling. After losing one-third of its value from its November peak, BABA has managed to recoup some of those losses. Recently, however, it’s sunk again, and the bulls’ main hope right now is that the horizontal I’ve drawn below provides support. I’m short […]
Slope of Hope

SPY Trends and Influencers May 30, 2015

Written By: DragonFly Capital

A weekly excerpt from the Macro Review analysis sent to subscribers on 10 markets and two timeframes.

Last week’s review of the macro market indicators suggested, heading into the unofficial start of Summer the equity markets looked positive and better in the longer timeframe than the shorter one.

Elsewhere looked for Gold ($ GLD) to continue to hold near 1200 while Crude Oil ($ USO) consolidated with an upward bias. The US Dollar Index ($ UUP) was biased to the upside but it was still too soon to declare a reversal higher while US Treasuries ($ TLT) were biased lower but showing signs of consolidation. The Shanghai Composite ($ ASHR) was moving higher in renewed strength and Emerging Markets ($ EEM) were biased to the downside in the uptrend, debating whether it was a bull flag or a reversal.

Volatility ($ VXX) looked to remain subdued keeping the bias higher for the equity index ETF’s $ SPY, $ IWM and $ QQQ. Their charts agreed with that on the weekly timeframe, but showed better strength on the SPY and QQQ on the daily timeframe than in the IWM.

The week played out with Gold probing lower under 1200 but quickly finding support while Crude Oil tested the consolidation zone but held and bounced. The US Dollar continued higher before a pause while Treasuries broke the downtrend, moving higher. The Shanghai Composite made another new 7 year high before pulling back while Emerging Markets took another turn lower.

Volatility opened higher Tuesday but then stayed in a tight range all week. The Equity Index ETF’s all fell from their recent highs to start the week, with the SPY then consolidating, the IWM reclaiming some ground along with the QQQ, which also printed a new 14 year high close along the way. What does this mean for the coming week? Lets look at some charts.

SPY Daily, $ SPY
spy d

The SPY started the week pulling back under the 212.50 breakout level and running lower. A failed breakout thus far. It found support at the 20 day SMA and bounced Wednesday back to the break out area where it held Thursday with a doji candle. Friday saw another move lower to the 20 day SMA where it ended the week. In all, a tight range but lower and importantly under the breakout level. The RSI on the daily chart pulled back but is holding at the mid line in the bullish zone while the MACD is crossing down. These would support more downside.

The weekly chart shows last week’s break out, but as a possible Evening Star reversal candle, that was confirmed lower this week. The momentum picture on this timeframe is similar to the daily one, with the RSI at the mid line and the MACD about to cross down. There is resistance higher at 212.50 and 213.78 with a Measured Move to 216.50 and then 221 above. Support lower comes at 211 and 210.25 followed by 209 and 208. Consolidation in the Long Term Uptrend with a Short Term Downside Bias.

SPY Weekly, $ SPY
spy w

Heading into June the equity markets are mixed, with the QQQ strong but the SPY and IWM showing some short term weakness.

Elsewhere look for Gold to continue to hold between 1180 and 1200 while Crude Oil consolidates with an upward bias. The US Dollar Index looks to continue higher while US Treasuries also are looking stronger, possibly breaking their downtrend. The Shanghai Composite is in pullback mode in the uptrend but at a good support level, while Emerging Markets are falling and look weak.

Volatility looks to remain subdued keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. Their charts are a bit mixed, with all better on the weekly timeframe than the daily, and the QQQ’s the strongest short term while the SPY and IWM may pullback. Use this information as you prepare for the coming week and trad’em well.

Join the Premium Users and you can view the Full Version with 20 detailed charts and analysis: Macro Week in Review/Preview May 30, 2015

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Dragonfly Capital Views Performance Through May 2015 Expiry and sign up here

The post SPY Trends and Influencers May 30, 2015 appeared first on Dragonfly Capital.

Dragonfly Capital

FAO Schwarz closing shows video game dominance?

The most famous toy store in the U.S. will be closing on July 15 (USA Today). They can’t justify the rent on Fifth Avenue now that everything in New York is gold-plated. I’m wondering if this also shows the dominance of electronic games. A $ 1500 stuffed giraffe is great but do kids value it as much as $ 100 of apps?

What do readers think? Is there is a long-term downward trend for non-electronic physical toys?

[Separately I wonder what New York is going to look like going forward. Any part of the city exposed to the market economy seems to trend toward high-end stuff that is not useful for day-to-day living. Yet the government is passionate about “affordable housing” and the lucky few (55 out of 88,000 in this example) end up with an apartment worth perhaps $ 5 million that they can occupy for life, but not sell. So they can’t take the $ 5 million and move to the Midwest (or Mexico?) and enjoy being rich. Instead they will stay in Manhattan, have a job at Starbucks, and have to order everything from Amazon because the local retailers sell only furs and diamonds.]

Philip Greenspun’s Weblog

U.S. versus German infrastructure spending and results

“Quality, Not Just Quantity, of Infrastructure Needs Attention” (Wall Street Journal, May 20, 2015) has some interesting data. The U.S. has spent, adjusted for deprecation, 52 percent of GDP on “public capital stock” (infrastructure such as roads, bridges, train tracks, etc.) while the Germans have spent just 35 percent of GDP. What results have been achieved? “global executives” rated the German infrastructure superior to that of the U.S.

In other words the Germans are getting substantially better value for each public dollar invested.

Why the constant calls by Americans to put more money into public infrastructure if it turns out this is not one of the things that we can do competitively?

Related:

Philip Greenspun’s Weblog

Wednesday Webinar: Five Step Checklist for Finding the Next Hedge Fund Darling Stocks

This should be an interesting, can’t miss webinar!

John Carter is providing for us a free webinar entitled “The Five Step Checklist to Find the Next Hedge Fund Darlings!

I’ve seen a preview of the webinar and I’m a big fan of my colleague John’s work so I’ll be attending this one as well!

John will be sharing a formula for scanning and finding key stocks that are about to break onto the radars of Hedge Fund managers – remember most can’t buy stocks under $ 10.00 – and how to buy stocks under accumulation from these larger funds.

He’ll outline a specific checklist you can start using right away and when to add these potential big winners to your growing portfolio.

It’s free and just requires an email registration – hop on over now and get ready for this exciting webinar!

Thanks to John and his team for making these events available to us in the trading community.

Corey


Afraid to Trade.com Blog

Monica Lewinsky’s lost child support profits

I was chatting with a litigator about Real World Divorce and politics. The subject of the Clintons’ roughly $ 22 million/year in earnings came up and the litigator noted “Monica Lewinsky could have done pretty well for herself if she hadn’t left the white gold on her blue dress.” What did she mean? It turns out that if Monica had stayed in the District of Columbia with Bill Clinton’s child she would have been entitled to roughly $ 2 million per year for 21 years, i.e., about $ 42 million total in tax-free profit.

What about the fact that some of the money was earned by Hillary? “A judge could use discretion to award child support based on the combined income in a variety of ways,” she explained. “One is by awarding a higher percentage of Bill’s income with the explanation that Hillary’s earnings can replace those lost to a child support plaintiff. Another is by accepting the argument that Hillary wouldn’t be earning any of her speaking fees but for her relationship with Bill and being part of the couple. A third way of getting a child support award based on the full $ 22 million would be to argue that much of the Clinton Foundation spending, e.g., on travel or parties, should be considered income to Bill and Hillary. Adding in a judge-determined amount from the Foundation to Bill’s income would bring his income for child support calculation up to $ 22 million per year.”

Philip Greenspun’s Weblog

What Does “Losers Average Losers” Mean?

Many years ago Paul Tudor Jones was photographed in front of a photo that read “Losers Average Losers”. What the heck does that mean and why is it so important? As traders our #1 job is managing risk. If you add to losing positions it may become extremely difficult to manage your risk. For example, If you put on a position with X dollars of risk and the position moves against you and you increase the position size very quickly a position with an initial risk of X can become 5X or more and jeopardize your monthly return or even your career (as happened to one of our traders last year who lost 20X his daily limit). In our training Read more […]
SMB Capital – Trading Education

Top Trade Ideas for the Week of May 26, 2015: The Rest

Written By: DragonFly Capital

Here are the Rest of the Top 10:

Anadarko Petroleum, Ticker: $ APC
apc

Anadarko Petroleum, $ APC, pulled back with the selloff in Crude Oil the second half of 2014. But since December it has been trending higher in a broad rising channel. Last week looks to have marked another bottom in that channel, with a Doji reversal candle confirmed higher and then follow through Friday. The RSI turned back up and the MACD is turning toward a positive cross.

CBOE, Ticker: $ CBOE
cboe

CBOE, $ CBOE, retraced about 61.8% of the run higher from July to the peak in January before finding support. Since then it settled sideways for 2 months before starting back higher. The first leg consolidated in a bull flag and broke higher Friday. The RSI is in the bullish zone and rising and the MACD also rising, both supporting more upside.

Interactive Brokers, Ticker: $ IBKR
ibkr

Interactive Brokers, $ IBKR, has been trending higher since October 2014. The latest leg has been against rising tend support. It touched that again last week and turned back higher. The RSI and MACD are also both rising, supporting the upside continuation.

Lululemon athletica, Ticker: $ LULU
lulu

Lululemon athletica, $ LULU, based for a long time in 2014 before a jump higher started in December. That led to consolidation in a Diamond top that is currently breaking down. The RSI is in the bearish zone and the MACD falling as well.

SINA, Ticker: $ SINA
sina

SINA, $ SINA, peaked in late 2013 and then pulled back throughout 2014. It finally found a bottom in April this year and made its first higher high to start May. Since then it has pulled back in a bull flag. It broke that flag to the upside Friday, and has support from a bullish RSI for more. The MACD has stopped falling as well and is leveling.

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The Best

If you like what you see sign up for more ideas and deeper analysis using the Get Premium button above.

After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which, heading into the unofficial start of summer sees the equity markets looking positive and better in the longer timeframe than the shorter one.

Elsewhere look for Gold to continue to hold near 1200 while Crude Oil consolidates with an upward bias. The US Dollar Index is biased to the upside but it is still too soon to declare a reversal higher while US Treasuries are biased lower but showing signs of consolidation. The Shanghai Composite is moving higher in renewed strength and Emerging Markets are biased to the downside in the uptrend, debating whether it is a bull flag or a reversal.

Volatility looks to remain subdued keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. Their charts agree with that on the weekly timeframe, but show better strength on the SPY and QQQ on the daily timeframe than in the IWM. Use this information as you prepare for the coming week and trad’em well.

Want to learn more about Dragonfly Capital Views?
Dragonfly Capital Views Performance Through May 2015 Expiry and sign up here

Get my book, Trading Options: Using Technical Analysis to Design Winning Options Trades.

The post Top Trade Ideas for the Week of May 26, 2015: The Rest appeared first on Dragonfly Capital.

Dragonfly Capital

New Yorker pokes into the venture capital world

“Tomorrow’s Advance Man” is a New Yorker story (May 18, 2015 issue) about the world of Marc Andreessen, NCSA Mosaic browser programmer turned venture capitalist.

The story explains how the top firms get consistently better returns than the less-known ones: “The imprimatur of a top firm’s investment is so powerful that entrepreneurs routinely accept a twenty-five per cent lower valuation to get it.” (i.e., they are buying at a lower price than competitors)

The market-clearing price for a competent venture capital partner is not very high: “[A16z] general partners make about three hundred thousand dollars a year, far less than the industry standard of at least a million dollars, and the savings pays for sixty-five specialists in executive talent, tech talent, market development, corporate development, and marketing.” Presumably the partners get some kind of boost when a portfolio company is sold, but $ 300,000 per year is what a senior programmer at Apple or Google could expect to earn (and more evidence that Ellen Pao would have made more money by getting pregnant than by working as a VC).

What would be a fair price for the job? Maybe $ 0:

The dirty secret of the trade is that the bottom three-quarters of venture firms didn’t beat the Nasdaq for the past five years. In a stinging 2012 report, the L.P. Diane Mulcahy calculated, “Since 1997, less cash has been returned to V.C. investors than they have invested.” The truth is that most V.C.s subsist entirely on fees, which they compound by raising a new fund every three years. Returns are kept hidden by nondisclosure agreements, and so V.C.s routinely overstate them, both to encourage investment and to attract entrepreneurs. “You can’t find a venture fund anywhere that’s not in the top quartile,” one L.P. said sardonically. V.C.s also logo shop, buying into late rounds of hot companies at high prices so they can list them on their portfolio page.

Philip Greenspun’s Weblog

SPY Trends and Influencers May 23, 2015

Written By: DragonFly Capital

A weekly excerpt from the Macro Review analysis sent to subscribers on 10 markets and two timeframes.

Last week’s review of the macro market indicators suggested, heading into the Memorial Day Weekend that the equity markets looked healthy, but remained short of break outs.

Elsewhere looked for Gold ($ GLD) to continue to consolidate with a short term upward bias while Crude Oil ($ USO) consolidated in its uptrend. The US Dollar Index ($ UUP) looked to continue to pullback while US Treasuries ($ TLT) bounced in their downtrend. The Shanghai Composite ($ ASHR) was in broad consolidation mode while Emerging Markets ($ EEM) consolidated with an upward bias in their uptrend.

Volatility ($ VXX) looked to remain subdued with a bias lower keeping the bias higher for the equity index ETF’s $ SPY, $ IWM and $ QQQ. Their charts were all still more positive on the longer timeframe, but the SPY and QQQ looked stronger than the IWM. This might yield an opportunity in the IWM to catch up.

The week played out with Gold falling back toward 1200 while Crude Oil continued to hold in the consolidation range from 58.50 to 62. The US Dollar found support and bounced while Treasuries tested lower, finding support as well before a small bounce. The Shanghai Composite moved higher to a new 7 year high while Emerging Markets consolidated sideways in a tight range.

Volatility moved lower, making a new low for the year, before rebounding slightly. The Equity Index ETF’s were all positive but mixed, with the SPY setting a new all-time high, and the IWM the QQQ close to their recent all-time and 15 year highs. What does this mean for the coming week? Lets look at some charts.

SPY Daily, $ SPY
spy d

The SPY moved over the long ascending triangle Monday and then consolidated at the new highs all week. Wednesday printed a new intraday high level and then Thursday a new all-time closing high before an inside day Friday. The daily chart now has a move higher to consolidation and a Measured Move over that to 217.80. There is also a larger target above that at 221 from the triangle break.

The RSI remains in the bullish zone with the MACD slowly rising, maybe flattening. These continue to support the bullish case. As do the rising Bollinger Bands®. Skeptics will point to the volume decline, but that is also a bullish indication that the consolidation might show itself to be a bull flag and leap higher.

On the weekly chart the small move out of the consolidation zone is significant but also shows how easily it could pull back in. The RSI on this timeframe is rising and bullish and the MACD crossed up, again both supporting the bull case along with the rising Bollinger Bands. There is no resistance higher over the highs made this week, and support lower comes at 212.50 and 211 followed by 210.25 and 209. Continued Uptrend.

SPY Weekly, $ SPY
spy w

Heading into the unofficial start of summer the equity markets look positive and better in the longer timeframe than the shorter one. Elsewhere look for Gold to continue to hold near 1200 while Crude Oil consolidates with an upward bias. The US Dollar Index is biased to the upside but it is still too soon to declare a reversal higher while US Treasuries are biased lower but showing signs of consolidation. The Shanghai Composite is moving higher in renewed strength and Emerging Markets are biased to the downside in the uptrend, debating whether it is a bull flag or a reversal.

Volatility looks to remain subdued keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. Their charts agree with that on the weekly timeframe, but show better strength on the SPY and QQQ on the daily timeframe than in the IWM. Use this information as you prepare for the coming week and trad’em well.

Join the Premium Users and you can view the Full Version with 20 detailed charts and analysis: Macro Week in Review/Preview May 22, 2015

Want to learn more about Dragonfly Capital Views?
Dragonfly Capital Views Performance Through May 2015 Expiry and sign up here

The post SPY Trends and Influencers May 23, 2015 appeared first on Dragonfly Capital.

Dragonfly Capital

How does the $5.6 billion fine against the banks discourage future collusion?

Employees at five banks colluded to earn supranormal profits in rigged markets (nytimes). Presumably they were rewarded by their employers with correspondingly huge bonuses. Those bonuses by now have been turned into beach houses, Gulfstreams, etc. The government comes along more recently and fines “the banks” $ 5.6 billion. But it seems to me that this fine has to be paid by the shareholders of the banks, not past, present, or future employees. If we assume a labor market the employees of banks are paid a competitive wage. So the banks that have been fined can’t reduce salaries or their better people will jump ship. Thus it will be shareholders who pay. But public company shareholders, due to SEC regulations that prevent them from directly nominating board members, exercise virtually no control over what actions bank employees might take. How then can this fine reduce the likelihood of similar behavior in the future? Wouldn’t a rational current bank employee still seek to collude with counterparts at other banks, rig a market, make huge profits for a while, take home and keep huge bonuses, etc. Why does the employee care if at some future date a shareholder will have to pay a fine because of his or her behavior?

 

Philip Greenspun’s Weblog

How Last Week’s Top 10 Performed

Written By: DragonFly Capital

Every month following Options Expiration I post performance metrics of the Dragonfly capital Model Portfolio. This includes all trades that I entered over time. What it does not include is the one’s I miss for whatever reason (getting lunch, going to the bathroom, etc….). So as I enter my 6th year in this blogoshpere adventure I am adding a new twist. Each week I will post the performance of the stocks that were given to subscribers the previous Sunday plus the Bonus idea from Monday pre-market. Here is this week’s:

top 10

Get my ebook, Markets for 2015 and Beyond, a long term forecast with all proceeds going to charity.

Want to learn more about Dragonfly Capital Views?
Dragonfly Capital Views Performance Through May 2015 Expiry and sign up here

The post How Last Week’s Top 10 Performed appeared first on Dragonfly Capital.

Dragonfly Capital

Not enough rich bastards to keep Bombardier Global Express production going

Somebody forgot to tell Bombardier how much richer the global rich are getting. “Bombardier to Cut Production of Most Lucrative Jets” is a May 14, 2015 Wall Street Journal article about how “tough economic conditions world-wide and geopolitical issues have reduced demand for its Global 5000 and 6000 jets, its most expensive long-range business jets currently in serial production. The production cuts will result in the loss of about 1,750 jobs and weigh most heavily on its Montreal-area operations, where about 1,000 workers will be laid off.”

[The Global Express is a Gulfstream competitor and costs about $ 50 million if moderately pimped out. It is a cousin to the Canadair Regional Jet that I used to fly (previous post about landing at LGA; another visual approach posting).]

Philip Greenspun’s Weblog