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This Is Not a Drill

March 12, 2020 / / No Comments

The intent of this post is not to make any additional panic. I’ve been on the defense since the first half of February, and I hope you were too after posts Bonds, buy Bonds and Bumpy road ahead were published.

But things are getting serious, the virus is affecting the economy and the markets greatly as you have probably already noticed. I’m not an expert on viruses, but the markets are telling us this situation is not to be taken lightly. As I tweeted a few times in the past couple of weeks I prefer to “panic” sooner rather than later. Majority does the opposite, rather than prevent they’re forced to deal with the consequences.

As of writing the S&P 500 stock index is down more than 8% just today, or down more than 25% from the peak. This is on record the fastest 20% correction measured from the peak, including the 1929 meltdown.

We might be due for a snap back, a face ripper, rally. This may also be a historic buying opportunity, but as things stand, I wouldn’t exclude more downside further down the road, or, in best case scenario, a period of very high volatility with a range bound trading. There’s just an overwhelming supply waiting at higher prices.

I’ve been seeing so many “buy the dip” calls during this selloff. Everybody is so eager to buy the bottom because they’re sure the market will be higher a few weeks, months or years from now. But what if we don’t see a repeat of 2019? What if the EU and the US get into a complete lockdown? What if the selling is not over yet? What if the exchanges are forced to shut down for a prolonged period of time? Could you handle that?

However you might want to turn this around, this is a period when cash is king.

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Crash of 2020

March 9, 2020 / / No Comments

What a historic times! After relentless selling and the fastest correction on record according to Deutsche Bank, we’re seeing some crazy after-weekend moves in the over-night session. S&P 500 index futures are limit down (meaning, after a quick -5% move trading has been halted until the US opens), bond prices are surging and that oil… man, crude oil was down -30% from Friday’s close in just a matter of minutes!

Brent oil’s move at the moment stands as the 2nd largest one day move ever. On Jan 17th, 1991 Brent closed down -34.8% in a day. Let’s see where it closes at today, but the next largest move is -13.5%, so today’s move will be either the largest or second largest on record. Here’s a chart of WTI oil.

I don’t know how the stock market will react once the US session starts. Will we see a bounce, or a continuation of selling is anyone’s guess at this point. However, I hope you took precautionary measures in February when I posted Bumpy road ahead and Bonds, buy Bonds. Hope you’re safe and were able to limit you losses.

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Will gold bugs finally have their day?

June 3, 2019 / / No Comments

Last October I’ve started noticing some positive developments in gold just when stocks started to correct into Christmas eve’s bottom, see Rotation to gold and miners?. Since then it’s been firming up for possibly something bigger.

I’m not one of those gold bugs who’ve been advising to hold gold in the past almost 10 year long bear market. I don’t believe in some idealistic ideas with potentially huge opportunity costs. But when I see a good opportunity I try to grab it with both hands.

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Rotation to gold and miners?

October 11, 2018 / / No Comments

It looks we could see a correction in the US stocks too. We’ve been seeing it in other markets already. I still think this could only be a correction within a secular bull market and I don’t want to be calling for a 2008 style crisis yet however it can always evolve into something bigger.

There is an interesting rotation happening right now though. Gold has been a mess in the past months and even years. Many were expecting it would start trending higher.  I was one of them for some time but I’ve put that thesis aside until now. I’m starting to see reasons for joining the party! What if this correction in the US stocks will ignite it?

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Is US nat gas just breaking out of a major bottom?

September 24, 2018 / / No Comments

European energies and oil had an unbelievable run in the past 2 years. But in the same period the US natural gas was going nowhere. It was stuck in a narrow range. I’ve heard so many people it won’t and can’t go up anymore.

But where have I heard this before? Right… the same story was going on with the European energies a year or so ago. Please read my past post where I write about a potential bottom there. And they gave us such a great show this year. I believe something similar could happen with the US nat gas in the months to come.

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Why I keep being constructive on oil

September 4, 2018 / / 1 Comment

Summer is slowly but steadily nearing its end. It was a great opportunity for me to take a break and do some stuff I didn’t have time for during the year. I was still watching the markets, but trading much less frequently than usually. One has to keep in mind that the markets will always be here and so will the opportunities. When I was less experienced I thought that if I miss an opportunity it’s over, I will miss the train to the riches… so perhaps like the most of us I had the fear of missing out. Once you really understand that, sure we swing for the big win, the market keeps throwing opportunities at you, you get much more relaxed.

But what I wanted to say is that when you do that, when you step back a bit, you might get a fresh look or a new perspective on things. You open up to the new ideas. And this is the big win. Everyone needs to do it now and then.

Anyway, let me get to oil now. Since last summer I had been constructive on oil and energy prices in general. Read More

Bull case for uranium

June 6, 2018 / / No Comments

My Twitter followers probably already saw me tweeting about uranium for a while now. I’ve been saying that it could bottom here, where the main instrument or vehicle of choice is Global X Uranium ETF $URA. It’s been bottoming for the past 3 years and it feels the process could be ending soon. Read More

Silver: The next big thing?

May 31, 2018 / / No Comments

Silver hasn’t move anywhere in the past 2 years, it’s been in a range and this range is getting smaller and smaller. It’s just nuts, it’s dead money and if you’re invested in silver then you’re probably going crazy looking at other people making money trading stocks, oil, base metals, etc. While you’re getting nothing. The opportunity cost here is just huge!

Well there still might be some hope left. Read More

Macro overview

May 6, 2018 / / No Comments

I would like to present you my current macro views. The markets are at very interesting points and offer very good opportunities at the moment.

The format of this post will be slightly different than usual, I will post my tweets because I think that the combination offers a better reading experience.

I would like to start with the major stock market indices. There is so much interest in this market thus everyone has an opinion on it. I’ve been seeing so many bearish calls lately, such an increase in the negative sentiment,.. Sure, they might be right and as stated many times before, I don’t mind if the markets doubles or goes to zero from here. All I care is to participate from the right side. Read More

The shiny metal and its miners

January 17, 2018 / / No Comments

I guess it’s needless to say that I am a commodities bull. After all, even if you haven’t followed my blog regularly, you can tell this from my last post. This doesn’t mean that the price of commodities will only go up. There will be short-term cycles with corrections, even very quick ones, to shake the excessive excitement. Similar to what we see in cryptos today. This is just normal market behavior.

While gold didn’t get much of an appreciation lately, it had a very decent year. But I think it was only a beginning. I think gold could easily double or triple in the months to come. Read More

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