Tech Stocks and the Bigger Picture

"That is about all I have learned—to study general conditions, to take a position and stick to it." -- JL

Stocks:
Though AMZN is the canary, FB's failure to rally back to within .5X weekly ATR of ATH, and its relative weakness to tech and the S&P500 could spell near term trouble for the tech sector and potentially the sp. If the market thinks FB can't increase revenues, no one in tech can increase revenues.

Also, the Cambridge Analytica debacle/Zuckerberg interview set Congress's eyes on personal data in terms of election meddling. Now personal data is back in the forefront in GOOGL/FB/AAPL/SPOT's conservative censorship issue and accusations of bias toward President Trump. At least for FB, the negatives appear to be outweighing the positives in the short term.

Broad view:
The guys who know what is what thought the last mini-crash in Feb was the commencement of the Great Restructuring that would follow the Great Correction. Those who were faked out still lie in wait for the inevitable, but the Time element is mightier than ever in the age of Central Banks.

Standing between here (~2910) and a 50% correction is the precedent set by monetary policy (QE) in 2008. QE = Quantitative Easing = arbitrary money printing used to buy stocks/assets, and in the process prop them up. Therefore, in theory, we should never see spoos < 1400, as the Fed can print & bid stocks back to new highs with more QE.

QE = unlimited $ = unlimited buying power. and as Governor Flower said: "The only way I know of making a stock go up is to buy it."

The obvious trouble with this arrangement is the slippery slope: if you print once, now you must print in every recession. why not?

Prior to 1971, when Nixon removed the dollar from the gold standard, all currencies were tied to, and redeemable in gold, so QE was impossible.

The reason why money was redeemable in/tied to gold was to place a limit on inflation by limiting how much currency governments could create. Printing money for political purposes would simply result in a commensurate increase in the price of gold.

Today, there's no anchor on money.

Since there's no anchor and central banks across the globe have opened Pandora's Money Box with QE, then--provided no change in monetary policy--a serious crash is not only implausible, but next to impossible.

The Gorilla in the room, in terms of questions the market will need answers to before stocks can see a sustained, directional move, is: which will have greater force during the next recession: Bears, or zero interest rate policy and more QE. Every Fed chairman is tested by the markets and Powell has yet to cut his teeth.

via dailyspec:

April 2018

So far for the month of April, Bonds had 75% chance of closing green on Mondays and Fridays, 75% chance of closing red on Tuesdays, Wednesdays and Thursdays, while Stocks had 75% chance of closing green on Tuesdays, Wednesdays and Thursdays, and 100% chance of closing red on Fridays.

Via Dailyspeculations:

Red

Blue Day

Month of Dec begins with blue day. Stocks partially recover from sharp drop, down only 4 at close. pic.twitter.com/CuE1BJm8iQ

— Vic Niederhoffer (@VicNiederhoffer) December 1, 2017

Yellow Day

Last day of November: yellow. Gold (the metal, not the color) down again like yest. pic.twitter.com/MFSFwJvkxI

— Vic Niederhoffer (@VicNiederhoffer) November 30, 2017

Red Day

Red day with 4 musketeers down: stocks (esp. Naz), Tbonds, Crude, Gold pic.twitter.com/204XhUHjiU

— Vic Niederhoffer (@VicNiederhoffer) November 29, 2017

Green Day Yesterday

Green day as stocks make all time high. Up up Zimbabwe. pic.twitter.com/OlY8RZGTgR

— Vic Niederhoffer (@VicNiederhoffer) November 21, 2017

Yellow Day

yellow day a contrary day from morning to close pic.twitter.com/KxMaYG8vMV

— Vic Niederhoffer (@VicNiederhoffer) November 20, 2017

Blue Day

Week ended on blue day, bonds up, stocks down. I prefer to eschew bonds over the weekend and on Monday.a shocking day pic.twitter.com/SIlyqRJRrs

— Vic Niederhoffer (@VicNiederhoffer) November 17, 2017

Royal Bank of Canada Short (5/2/17)

(5/2/17) $RY sold mkt [to open]

— R. Alexander (@ralexa2008) May. 10 at 09:56 PM

QOTD

"In my experience, selling a put is much safer than buying a stock" (Kyle Rosen, 2004).

Week 7, Book 7: Triumph of the Optimists

$TLT - near-term target: 135; short term target: 140. Rating: Buy

$TLT - near-term target: 135; short term target: 140.Rating: Buy$SLV $GLD

— Rubin (@traderrubin) Feb. 23 at 05:07 PM

Portfolio Baskets A1 (Long) & A2 (Short)

January/February 2016:

1. Portfolio Basket A1 (Long): FB, SLV (SI_F), SOYB (ZL_F), TLT (hedge)

2. Portfolio Basket A2 (Short): AMZN, F