Random Walk Trading.com
Thursday
April 23, 2015
55-RWT-0008
TM
Prepared by the good people at Random Walk, LLC.
Closing Prices From Yesterday
Earnings started 2 weeks ago
Right now 76% beat earnings
48% miss the revenue number
Today’s Number(s)
Yesterday and Today
Yesterday
A STRNGE day yesterday. The Existing Home Sales Numbers came in up 6.1%, which is almost double what was expecting. This would indicate (if it was an alone number) that the economy is heating up.
The market ran up a little, then fell quickly and then started to work its way up slowly the rest of the day. That in itself is nothing. But what was weird was how bond fell hard in the process, but didn’t take the market down with it.
In a market that is so closely linked to low interest rates and paranoia that the Fed is going to have to raise rates, one would think that this number combined with rising interest rates would shock the market a little. In the market’s defense the climb up 88 points was very slow and hesitant, keeping one eye on the bond market.
TSLA
Tesla was up $12 before falling a little to close up $10. Elon Musk reported that he is going to be selling batteries to run homes shortly, and this had the stock flying.
TODAY
Strange times is all I can say to describe the current market conditions. This will be the third or forth time we are back to these levels where the Dow, the SPX, and the Nasdaq are all less than 1% away from all time highs. Yet the last three times we were here something came in to shock the market and we fell.
This action of lower highs and higher lows (forming into a funnel) would have many traders saying that we are about to break out of this trend in one direction or the other. Either this market fails a 4th time up here and we take a long time to get back again, or we are about to see an explosive move to the upside.
That said….Since we are in the strongest bull market the world has ever seen, I would (as a trader) say that we have to stay long the trend until a blow off run higher occurs. That said, I did try to hedge a big position in POT class on the close yesterday (just in case), but missed it (so I have to try again today).
FRIDAY
Also keep in the back of your mind that Friday Germany is meeting in Riga with Greece to produce a deal that could unlock more bailout funds to Greece. Greece is F(#(d. They are so short on cash that they are taking reserves from schools, social security funds, etc- Sort of like the US government, huh?
The difference is people in the US retire at 65 whereas in Greece the average age of retirement is birth. In the US some people will actually get a job at Walmart when their checks stop coming. In Greece they will riot and steal. Wait, so will the US. Hmm…..
Anyhow…
An unsuccessful resolution could trigger stocks in the EU to fall hard, which would have a ripple effect her. A surprise resolution (doubtful even though Greece is screwed without one) could spark a surprise rally. What people don’t understand is that kicking Greece out of the EU would be of benefit for every other country in the region. Greece is that drunk uncle that always borrows $20 from you but has NEVER considered paying you back, and looks down on you for being stupid enough to lend them money in the first place.
Last night we covered three different risk reversals ā 2 SPX (one hedged and one not) as well as TSLA. We talked about SPX after hours trading, and a little bit about what I look at to gauge market direction (a very brief overview).
Separate update is coming.
POT is held each Wednesday night at 7:00pm eastern.
Contract the office at 1- 855 ā RWT ā 0008 for more details.
Too True To Be Funny
Attorney Stuff
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