Time to Short The Market?

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Submitted by ltsddd on July 19, 2016 - 9:24pm

Anyone else thinks the stock market is frothy?

I am thinking of shorting DOW x 3 by buying some DXD.

Submitted by gzz on July 20, 2016 - 1:48am.

Ultra options like DXD are bundles of options, which means gambles with a house advantage. You might as well just go to a casino.

If you think the market is high, sell some of your long positions and buy bonds.

Submitted by ltsddd on July 20, 2016 - 6:33am.

I am about 60% cash. My stock holdings are mainly in 2 of the big US banks. I think the banks stocks are way undervalued, so I will hang on to these for awhile. That said, I think the market overall is frothy and bound for a correction in the near term. the udow is up by about 30% since the brexit low.

Submitted by Coronita on July 20, 2016 - 7:24am.

I think the markets are going to rally. I think people are going to pull money out of Europe and put it in the U.S. markets. Japan already is.

I'm trying to figure out what other UK companies could be takeover targets, given a weak UK pound and a strong currency like the Japanese Yen.

I think we'll see more actions like what happened to ARM Holdings over the next few months.

And even here, I think you'll have folks rebalance their 401k's such that their international holding is much less.

Submitted by The-Shoveler on July 20, 2016 - 7:27am.

I got to go with flu,

I was just reading an article that said investors are sitting on more cash than in the last 15 years, also they expect real helicopter money from the gov's of Europe etc.. (ie... checks for everyone!!).

Submitted by spdrun on July 20, 2016 - 7:48am.

On the other hand, the Euros' cash holdings in dollar value just took a massive haircut over the last year or so. Yay for a strong dollar!

I'm almost hoping that Trump wins and causes massive chaos through misguided policies. That would be fun to watch and an investment opportunity. But, nah, he's too hateful against people whom I really love.

Submitted by scaredyclassic on July 20, 2016 - 8:49am.

maybe.

Submitted by covidwithlime on July 20, 2016 - 8:58am.

I'm not as confident jumping in negative 3x ETF like DXD or SDOW just yet. But I did sell all of my bullish 3X ETF position waiting for the right opportunity. I might just wait it out and buy back into the bull side when the tide is right instead of trying to catch both the ups and downs. It's very possible that the market might run side way for a few days to a week and continue running up again.

Submitted by ltsddd on July 20, 2016 - 10:35am.

pulled trigger on sqqq

Submitted by Escoguy on July 20, 2016 - 11:16am.

do you have a limit for losses?

the up moves so far have been too solid to short,

most bad news rolls over in a few days,

fed is on hold, this is not a normal market

Please limit your losses to 5%

have you done an upside/downside analysis?

Submitted by Coronita on July 20, 2016 - 12:19pm.

I'm going the opposite direction... Gonna take a chance with Kinder Morgan and Chesapeake Energy, as long. Also bought Micron Tech. and holding AMD until after the earnings. I can digest a $2 drop in AMD stock with my remaining shares, and still come out a little ahead. Looking for a white knight in a probably atrocious earnings call though.

Playball AH today...

Submitted by ltsddd on July 20, 2016 - 12:54pm.

Escoguy wrote:
do you have a limit for losses?

the up moves so far have been too solid to short,

most bad news rolls over in a few days,

fed is on hold, this is not a normal market

Please limit your losses to 5%

have you done an upside/downside analysis?

This is strictly a short-term play and I'll liquidate before the week ended. I don't hang on ETFs more than a few days at a time regardless whether I am in the black or not.

Submitted by ltsddd on July 20, 2016 - 12:59pm.

flu wrote:
I'm going the opposite direction... Gonna take a chance with Kinder Morgan and Chesapeake Energy, as long. Also bought Micron Tech. and holding AMD until after the earnings. I can digest a $2 drop in AMD stock with my remaining shares, and still come out a little ahead. Looking for a white knight in a probably atrocious earnings call though.

Playball AH today...

I am a bit gun-shy about energy stocks. Got pulled into AT due to the high yield and got burned pretty badly. I think AT yield was close to 5%.

Submitted by carlsbadworker on July 20, 2016 - 1:29pm.

According to Jeremy Grantham, S&P 500 at 2300 will be the bubble territorial and we are not there yet.

So it is hard to say that it will correct just from this level given the Chinese central banks and other FED equivalent around the world are continuing pumping money into the market to prolong the unsustainable appetite for everything from raw material to iPhone in the global market. Just my personal view.

Also, the market overall is pretty cautious at the moment. It is priced high only because the unbelievable amount of cash that are floating around. That's why you got both S&P 500 reaching new high and the bond market yield testing new low at the same time.

Submitted by The-Shoveler on July 20, 2016 - 1:47pm.

Lots of talk about Central banks REAL helicopter money and Fiscal money (not so much from the US fed, but other countries).

My other thought on this is that generally big crashes don't happen until the little guy(s) are all in.

Most investors are sitting in cash right now.

Anyway IMO.

Submitted by ltsddd on July 20, 2016 - 9:39pm.

I am not greedy. I just need the Nasdaq to pull back 1 or 2% the next couple days.

What would you do if walking through a casino floor and seeing that a roulette table has hit 9 black in a row?

I know I'll stop and put some money on red

http://money.cnn.com/2016/07/20/investin...

Submitted by Coronita on July 21, 2016 - 2:46pm.

AMD swings to profit. Yeah...

Kinder Morgan sort of sucked .Booo...

Net effect... $0 (both pretty much cancel each other out).

Submitted by mixxalot on July 21, 2016 - 6:46pm.

Bought some Ford, Apple, and Pfizer at last drop and they are doing pretty well. Will hold long as they pay dividends and will be around long term.

Submitted by moneymaker on July 21, 2016 - 7:44pm.

My opinion is that most money will bypass the US and go to China i.e. countries that actually produce stuff. Then after all the money is done chasing yield and demand starts to wane the next crash will come and it will affect everyone everywhere.Outside of a nuclear event that is my doomsday prediction.

Submitted by Coronita on July 22, 2016 - 10:55am.

And yes, the turd AMD is up a lot today. Lol.

Submitted by Coronita on July 25, 2016 - 7:41am.

For whatever reasons, nasdaq seems to be holding it's weight... Semi sector looks like it's moving up, and if semis are a leading indicator, that might be good news for the tech sector in general, since semi's have been trashed for the past year.

I've added to my AMD and MU position, and also bought (unrelated ) GE after watching for some time.

Since my entry point on AMD $2ish/share, and it sits at $6.20 right now, why not double down, lol...I'm hoping there's a bunch of shorts that were expecting a dismal AMD quarter, that are now going to panic, and we'll get a nice big short squeeze up this week.

Still ticked off I missed that big gain on ARMH just by selling a week earlier...Stupid.

Submitted by ltsddd on July 26, 2016 - 6:23am.

I missed my exit point, twice, last week on sqqq....I am going to hang on to sqqq for now....

Submitted by Coronita on July 26, 2016 - 11:45am.

The market is crazy. It's yo-yo- ing up and down today....Make up your mind, damnit.

Submitted by FormerSanDiegan on July 27, 2016 - 11:46am.

ltsdd wrote:

This is strictly a short-term play and I'll liquidate before the week ended. I don't hang on ETFs more than a few days at a time regardless whether I am in the black or not.

Hopefully you cut your losses before today...

sqqq down 2% today and 3% since June 20.

You can blame Apple for sucking less than expected.

Submitted by FormerSanDiegan on July 27, 2016 - 11:50am.

Interesting recent article on triple-leveraged ETFs, such as sqqq:

Basic premise is that over long periods you may make the right call and still lose.

Example Nasdaq declined 1.6% from beginning of year through May.
What did the triple-short sqqq do over that period ? It declined 5.3%.

http://www.wallstreetdaily.com/2016/05/3...

Submitted by ltsddd on July 27, 2016 - 11:55am.

Not yet. Thought about it this morning. My gains on the bank stocks more than offset this gamble on sqqq so I am not too worried for now. The nasdaq has been solid...

On a different note. WTH is wrong with yahoo? They keep tweaking their finance page. The new format could no longer show a list of stock quotes (only 1 at a time) and good luck looking for foreign stock market indexes. I need to start getting into the habit of going to marketwatch instead of yahoo.

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