PLTB member -
Wow...that was a workout...but today's PLTB is a MUST watch...
As the market gets back to 'what covid' highs it is absolutely time to start looking for an exit - medium term. The next 4 months literally will be a war for power in this country...the market only cares when it cares, and when it does it will be UGLY.
Replay is posted at the bottom of the page.
We looked at buying puts on RUT out to NOV (while they're cheap...could get cheaper):
Long put metrics:
Long VIX calls:
Good morning, ladies and gentlemen. Top Gun Options members welcome to our primary brief this Tuesday morning. We got a little bit of a relief pullback in the market. Hard to believe that the Dow is down 300 points and that is nothing. In the old days a triple digit move meant the end of the world.
In my institutional call this morning there was not one bearish person, which in itself is scary! It is the "buy the dips" moment. All of those guys who said to buy the dip on the way down are out of money and the ones who aren't are now saying to buy the dip now at the top of the rally!
Disclosure: Long AAPL, Long MSFT, Short FXI, Short AAL.
This is probably one of the most disgusting tweets the President has ever tweeted. I hate it when he does this. Mattis was our country's most overrated general. He talked a lot but never brought home the bacon. Are you fucking kidding me? You are going to polk at the USMC? I am not happy with General Mattis but saying a marine is not a marine. Trump never wore any uniform and certainly not a United States Marine.
Why am I ranting about this? It's politics. As the election draws near we need to project our thoughts forward in time. What if Colin Powell, Bush Junior go to the Democratic convention to support Biden. That will leave a mark. It is going to get ugly.
Regarding North Korea they have cut off all communication with the South. It's like it is timed. Other leaders know what is going on in the US and are getting ready to torpedoe the election. Everyone is focusing on PE ratios, etc. Now is when I start walking backward and hedging. A storm is coming, folks. The market is going to implode and even though I don't like this I will make money.
Anything goes in the market today. Watch the retail flow. Hertz is up 100% and it is bankrupt. Anything goes in the market and there will be a painful reckoning.
The folks who said to buy stocks all the way down during the Covid crash who said to sell during the recovery are not saying to buy again but at much higher valuations. Crazy.
The call to put ratio is the highest ever. Everyone is long. There is a storm brewing and if you go into this fall with the same approach you will be destroyed. The market is roaring upward and we have the highest unemployment since the depths of the Great Depression.
The market is disconnected from corporate profits and from the economyy. It is worse than the dot com bubble. Too many people are not part of this rally. Guess what. Polls are awful for Trump. All of the RINOs are piling on for Biden.
When the market starts pricing in a Democratic win in November, taxes and all, the market will correct by 40%! You need to buy October protection.
Fear of missing out is still driving the market and is being aided and abetted by the Fed. This is like any mania. The Fed has helped control the market and kept the economy from being worse than it could have been. All of this can collapse and go below the March lows. The last time I felt like this was in 1999 when everything was going up before it crashed in the dot com crash.
Now we are waiting to hear what Powell will say. When there is not consensus I just sit on my hands. Jerome knows a hell of a lot more than I do. He knows that the market could crash. Will he come out and kick the teeth in of retail traders? By the way the past head of the NY Fed said Powell needs to jack rates up to kill the economy and ensure that Trump loses the election.
Lots of folks are saying they will wait for the top before worrying. Why do you buy insurance? Put your protection on and be ready. The market goes does a lot faster than it goes up. I don't complain about paying for auto insurance.
Have a great rest of your day. Happy hunting. Make sure you hedge and God bless.