More more more!

[786Trader]

Not that I am complaining. So far, almost every long position I have has popped, with the exception of the FTSE or Flat Stonks exchange, as it's been the ugly duckling of world indices for quite some time. From USD weakness to barn storming world and US indices to commodities that have risen to orgasmic heights plus bonds of all descriptions including total junk with stratospheric totally unreasonable valuations and how can we not mention cryptos? Supersized prices and Bears that have chosen hibernation over extermination this winter. What goes up can only keep going up is the new adage. Are we all riding the rocket to the moon? 

Or will common sense prevail? Or remain effectively persona non grata, as is the current attitude to common sense? It looks like the Casino and all of the amusements and rides to the moon are the  mode and trend. It is totally bonkers! I am predominantly an Oil and Gasoline trader and frankly it's been a cash fest. All of my targets for the year have popped. For the year! Dow target popped, Euro targets popped. Popped the lot. Save the loveless FTSE which has still popped stage 1 and 2 of the ladder up. And we are still in lockdown!! Totally bonkers. It's like the worlds economy will be busier than ever and so soon. But this isn't representative of the worlds economy is it? This is the Fed saying it will underwrite the value of almost anything up to infinity and beyond. Naturally, the Fed has limitless money as do all of the other federal bankers across the globe. Unlimited upside. Makes sense surely?

It's like the party will never end.

So who am I to be a party pooper? I have taken several put options, across the board, as insurance and have started to think of positions to be taken in the extreme short term, as opposed to longer. (Days, weeks, months). It's madness out there. Much reminiscent of 1929 when the world and his wife, not to mention the wife's boyfriend, are stonking their hard earned savings to the moon. Only to get burned?

stay safe all.

BTW my aunty Janis recovered from Covid. There is an actual Cancer Covid 19 ward... she is over the Covid but still fighting the Cancer.. small mercies.

[HMB]

For the sake of completeness some arguments frequently made by the conviction bulls - would be keen to learn what you think on those:  valuations outside US and China large cap tech and tech-enabled consumer sectors are not that drastic, and in relation to rates even those segments are priced much more reasonably than 1999 (recent US bear steepening might change that if it continues).  Indicators like VIX and Skew (or the legendary CS Fear Barometer) are quite far away from mania seen not so long ago.  Wall Street strategists have been relatively bullish, but not excessively (BBG survey).

I wasn't around 1929 (please excuse this cheap punch line, also adding it for the sake of completeness only...), but guys then didn't have the Fed's demonstrated willingness to supply the non-US world with dollars and buy "fallen angels'" debt, nor the BoJ's equity ETF purchases.  There was also no common European debt about to be issued, nor a recently established Asian free-trade zone, covering 30% of the world's GDP.

Years before, though, there had been major technological breakthroughs.  And there are some parallels today:  self-driving cars, drones, mRNA vaccines, hyperloops, rockets that can land and be re-used (usually...), 3D printing, dating platforms where ladies make the first move...  just a small set of examples of science fiction having become reality.  So yes, the world's economy looks like it will be busier than ever soon - to many (personally I have no clue - I can't even forecast what I'll be doing myself in 30 minutes, makes me kinda shy away from attempting to shape a view of what the rest of the world will be up to years from now).

Nevertheless, if we get a pullback, I believe it could turn quickly rather violent.  Not least due to current relatively massive leverage (see e.g. margin account balances), the likely heavy use of protection strategies (given recent runs, bubble warnings and high valuations) which will accelerate any sell-off, but mostly for quick contagion - a not so subtle risk after an extended everything rally and rock-bottom interest rates.

Wondering if it's finally a time when OTM strangles might work one way or the other, and if short XBTUSD could prove to be a reasonable bubble-end hedge..

 

[THT]

Best wishes to your Aunty Janis - I bumped into the wife's boyfriend on his way to the Porsche garage, lovely fella, can exactly why she enjoys his company, sends his regards and mentioned he was keenly anticipating a fantastic ride whilst caressing her curves - not sure if he meant the car or something else

If you've read my Time Cycle thread, you'll know that we are literally right smack bang in that time period - with this TC I allow a weeks grace either side of the exact date - If its going to work (there is no guarantee) then yesterdays action could have been the start of it - simply have to wait and see - A pullback of some degree is expected, although I'm edging to think this TC may be a flat date which is rare, but hey ho

We have another different TC due early June too which demands respect - I'm planning on doing a piece specifically to it April time once we are clear of this current TC

PS - I don't trade TC's blindly, I wait for the market to form a clear trading formation (not yet happened) - although I too have a Put Option active as insurance

 

[786Trader]

A correction is due. 11 months pretty much straight bull run, barring one pullback in October that lasted less than a week. Agree, if not now then certainly by the end of June. Possibly a pullback by March, followed by another race to the moon before sanity/common sense/ global shock takes precedent and we all  realise just how expensive most everything is.

In the meantime, it's just one really stonking party! Until it's not.