As this is written on Sunday morning, having gone through a couple hundred individual stock charts, my thought is that the stock market is in worse shape than I thought, given last week’s strength. (You can always visit our site here to get these articles as much as a day earlier.)This week bulls are going to have their medal tested I believe. If this week we can consolidate — sell off a bit, but nothing major— then it becomes a clear victory for bulls. I think the latter is a best case scenario. The other scenario is another bloodbath where the recent swing lows are back in play and a trip to 500 or below on the SPY ETF is on the table for August. So this is going to be an important time in the stock market between now and the end of the month. I definitely lean bearish, and it’s up to bulls to see if they can hold last week’s gains. ARKK always a good sell in a bear scenario.
After 200 – 300% option gains booked on double positions in TLT (20 year bond ETF) at the 99 objective last week, I told subscribers to buy with both hands near 95.00 on a pullback. We got that pullback faster than I thought and I have another even larger position in TLT again, as I emphasized as well in this space last week. Even better in my opinion the market is drastically under pricing the options. I am long January and March 2025 options —- so plenty of opportunity to sell short dated options against these longs on rallies, and collect time decay on the short dated options, in a win/win scenario. The TLT will make or break my year, and it is off to a good start. The combination of what I think is a very bullish TLT outlook combined with what I think is significant underpricing in option premiums, I am very oversized on this position. Regaining and holding the close above 99 is now very bullish, for a target of 102 -103 initially.
Thanks,
Joe
Recent Comments