Due to technical and logistical timezone difficulties with JC traveling in Europe, we are unable to have our usual monthly conference call to run through the broad themes JC is seeing from his unique technical perspectives as well as our usual review of open positions that need action taken ahead of the upcoming expiration.
But have no fear -- we got you!
All Options Premium subscribers will also be invited to attend the next All Star Charts conference call so you can get caught up on the bigger picture in the markets. This Call will be held on Wednesday June 19th at 7PM ET.
We've been writing about the lack of trend in India and Equities around the globe for months and despite the breakout to new highs in the Nifty 50 and several Large-Cap stocks, we remain cautious about calling this a "confirmed uptrend" and getting overly aggressive on the long side.
In this post, we'll explain why this remains a two-way tape.
While updating our Members-Only Chartbooks today we came across two major breakouts that need to be pointed out as they play key roles in the Infrastructure and Public Sector Bank Sectors.
On May 1st, we wrote an update called "Canada or Cantada" going through the major sectors/indexes to provide a view on how we wanted to approach Canadian Equities.
As we can see, there are more uptrends than downtrends from a structural perspective. Tactically however, most of these are not at levels where we want to be initiating new positions or have a lot of conviction. After strong moves since December, they need some consolidation to digest those gains and set up for a sustained move higher.
Another thing to note is that the more defensive areas of the market like REITs and Staples have the clearest structural uptrends of the group. They make up a smaller portion of the market, but I think it's still an interesting signal about market participants' risk appetite and outlook for Interest Rates.
Additionally Energy and Materials account for roughly 30% of the index and remain a headwind, so without rotation into those names I think it'll be tough for the TSX Composite to break out to the upside.
The markets are engaging in some sideways chop thanks to whatever headlines we're ignoring. Meanwhile, there are some oversold sectors showing signs of some mean-reversion. And within one of those sectors, we've got a stock setting up with a pretty straight forward reward-to-risk opportunity.
Life can be simple or you can make things complicated and noisy. It's up to you.
What business are you in? The business of trying to make money in the market or the business of making and/or consuming noise?
I was out in Greece on my honeymoon for a couple of weeks last month, but I was keeping an eye on what was going on. I love the market and I enjoy observing human behavior. So why should I completely shut myself off from something I like doing?
Now that I am married, I would very much like to keep my wife happy, and I also think it's important to get away (see here). So appropriately I shut things off and enjoyed my time in, what are now officially, my favorite islands in the world. It was funny because some of the locals in the Cyclades Islands were telling me how much they wanted to go to the Caribbean. I was like, "Naw man, stay here. Trust me!"
If you still think the media is there to provide you with useful information, there is little I can do to help you. It's 2019. They're only there to sell you Buicks and razors and whatever else they can shove down your throat.
The content they provide is designed to get you to consume it for the sole purpose of selling your attention to their sponsors. That's just the business.
You have two choices: You can just take it until your punch drunk or you can take what you consume into your own hands. It's up to you.
Phil and I sat down for an interesting chat about this very topic:
Stocks showing relative strength in this environment remain on our radar since the list of them has shrunk day by day over the last month.
For our Institutional Clients, we provide more tactical trade ideas or "plus-ones" that don't necessarily fit a broader theme but are still an attractive opportunity worth exploring.
Today I want to share one of those ideas from a subsector of the market that may surprise you...Retail.
The drama queens have been in full force this weekend coming into the opening of trading this Monday morning. Here was my observation after rolling out of bed:
Geez, I shoulda checked $ES_F before I checked my twitter stream this morning.
FinTwit: THE MARKET IS CRASHING. ARMAGEDDON!!!
Futures: Down 6. Barely a rounding error.
Back to bed.
— Sean McLaughlin, NLD 📈 (@chicagosean) June 3, 2019
I rarely seek to be contrarian simply for the sake of being contrarian, but the mini hysteria I'm sensing amongst market participants feels a little hollow. Is everyone too leveraged? You're not trading based off headlines are you? ...are you??
If so, knock it off. Scared money don't make money.
With the S&P 500 re-acquainting itself with it's 200-day moving average, here's how we're going to play it...
I know some people who haven't taken a vacation in years. The excuses come in all shapes and sizes. For me, I think that does much more harm than good. I know this for a fact because I used to be one of those people. I used to think that I didn't deserve a break. "I'm not there yet", is what I'd say. I skipped vacations with my family and encouraged them to go without me. I've regretted those decisions ever since.
Over the past 5 years I've made it a point to get away regularly. I've written about it the benefits before and I feel more strongly about this than ever. Even if you take a week off where you just stick your computer in the closet and make it more of a staycation, that works too. It's important to be self-aware. I know myself enough that I do not have the discipline to stay away from my computer if I'm home. I like my work. I know I'll jump on and check out some charts. I can't help myself. So I need to go away completely to accomplish my goal of 'getting away'.
