Summary
- The Gold, Bitcoin and Crypto plunge suggests that tight systemic liquidity is starting to bite. Bond yields and equities should fall next.
- The recent upsurge in equity valuation has been driven by hedge fund and pension fund flow. But evidence of rampant stock buying mania start to harden.
- Markets appear to have digested (discounted) all the good news not only for the rest of 2020 but 2021 and beyond as well, with all-time Index highs and investor ebullience.
- We will set technical levels early this coming weeks which we believe will confirm the onset of a bear market.
- Until then, we will continue to trade gold scalpers as proxy for equities until we get clear indications that the uptrend has turned lower.
robert.p.balanModeratorLeaderOwnerNov 27, 2020 7:30 AM
GOOD MORNING EUROPE / GOOD EVENING WEST COAST
NOVEMBER 27, 2020
Bitcoin Plunges Along With Other Coins
(Bloomberg) -- Bitcoin plunged on Thursday in a sell-off that saw other digital assets fall more than 20%, a slide likely to stoke speculation about the durability of the latest boom in cryptocurrencies.The largest token fell as much as 14% in Thursday trading, heading for one of its worst days since the pandemic-spurred liquidation in March.The rout began just hours after Bitcoin rose to within $7 of its record high of $19,511, the culmination of a more than 250% surge in past nine months. Fears over tighter crypto regulation and profit-taking after a frenetic rally were among the reasons cited for the sudden drop.
yunengNov 27, 2020 1:05 PM
Certainly seems a sign of tightening liquidity.
robert.p.balanModeratorLeaderOwnerNov 27, 2020 7:32 AM
All of these risk assets are coming down. Equities and yields next to fall.
kizunoNov 27, 2020 7:34 PM
kizunoNov 27, 2020 7:34 PM
Bitcoin future last 3 days. No opinion, just watching this coal mine canary....
TimK123Nov 27, 2020 7:47 PM
Think Bitcoin might need a B wave retrace soon for technical reasons, it looks like it's had 5 waves down pretty much.
robert.p.balanModeratorLeaderOwnerNov 27, 2020 7:37 AM
An order filled.
PAM BUYS BACK 432 CONTRACT GCG1 SCALPERS AT 1808.75 LIMIT OR BETTER
*This order was filled (stop-hunted).*
*GCG1 -- DONE AT BETTER 1808.4 BOUGHT BACK 432 SCALPER CONTRACTS (SOLD AT 1816.6/1814.70) FOR ALL FUNDS*
robert.p.balanModeratorLeaderOwnerNov 27, 2020 8:08 AM
We've been 9 out of 9 in gold trades, so far since three days ago, when we started punting this gold consolidation phase. Looks like we are having a lucky streak. We will do other gold trades.
all PAM BUYS 144 CONTRACTS GCG1 AT DCC DISCRETION -- FOR ALL FUNDS
*GCG1 -- DONE AT 1811.8 BOUGHT 144 CONTRACTS GCG1, FOR ALL FUNDS*
12645731Nov 27, 2020 5:36 PM
RB one of my newsletters had gold stops in at 1785 for a long term hold thinking the low for gold for 6months is due this week. Today appears to be a contract rollover day from Dec to Feb also so some futures related position stealing would seem likely if the time outlook is correct.
RM13Nov 27, 2020 6:35 PM
Everyone is in the pool.
"The market is overbought and statistically overvalued after experiencing the third best month (in November), in percentage terms, in history.""Speculation is now running amok (EV, SPACs, etc.) and sentiment is at an extreme - whether seen by the CNN Fear and Greed Index sentiment studies... ... or, as we previously noted, the record high gross and net hedge fund exposure as well as other data. This is in marked contrast to September/October when many were fearful of the election and its consequence on equities."
Buying Bonanza Culminates With Record Inflows Into Global Stocks" BofA CIO Michael Hartnett showed further evidence of the rampant stock mania citing the latest EPFR fund flow data which shows nothing short of a "buying bonanza", with flows in the latest week as follows: $17.5bn into equities, $6.4bn into bonds, $2.2bn out of gold, $2.9bn out of cash."" In short, the market appears to have digested all the good news not only for the rest of 2020 but 2021 and beyond as well."
Everyone is now in the pool.
stephane.cNov 27, 2020 6:36 PM
Stats for the 100 largest constituents of the S&P 500. 62% have positive momentum, this is decreasing but still substantially above 50%
robert.p.balanModeratorLeaderOwnerNov 27, 2020 8:16 AM
We will put a GTC order to potentially hedge these stranded YM overhedge short, in case the market rises further.
all PAM BUYS 576 CONTRACTS YMZ0 (NO NETTING) AT BREACH OF 30,165, GTC -- FOR ALL FUNDS
robert.p.balanModeratorLeaderOwnerNov 27, 2020 8:55 AM
We will also put a GTC order for general long hedges to protect the other stranded shorts -- in case the market rises further.
all PAM BUYS 1,500 CONTRACTS EDZ0 AT BREACH OF 3660, GTC -- FOR ALL FUNDS
robert.p.balanModeratorLeaderOwnerNov 27, 2020 9:05 AM
all PAM BUYS ANOTHER 144 SCALPER CONTRACTS GCG1 AT 1812.4 OR AT BREACH OF 1814.5, OCO, GTC -- ALL FUNDS
This gold scalping is so much fun (and profitable). LETS DO IT EVERY DAY!
Gold is now acting the inverse of yields (as should be) so we do have an edge here.
robert.p.balanModeratorLeaderOwnerNov 27, 2020 9:22 AM
PAM BUYS ANOTHER 144 SCALPER CONTRACTS GCG1 AT 1812.4 OR AT BREACH OF 1814.5, OCO, GTC
*We get a partial fill.*
*GCG1 -- DONE AT 1814.7 BOUGHT 37 (OF 144 CONTRACTS; GTC UNTIL COMPLETELY FILLED)*
nanobrainNov 27, 2020 9:31 AM
RB, at what price would you start hedging this position?
robert.p.balanModeratorLeaderOwnerNov 27, 2020 9:31 AM
WHICH POSITION?
nanobrainNov 27, 2020 9:31 AM
last partial GCG 1814
robert.p.balanModeratorLeaderOwnerNov 27, 2020 9:31 AM
ITS JUST 1812
nanobrainNov 27, 2020 9:33 AM
I know ) but im planning to sleep today a bit, I want to place stop loss or hedge order just in case if this trade goes wrong way
robert.p.balanModeratorLeaderOwnerNov 27, 2020 9:34 AM
Understand. put it below the recent lows, say at 1808
Sorry, below 1806 -- that's PAM stoplevels too.
robert.p.balanModeratorLeaderOwnerNov 27, 2020 9:44 AM
PAM BUYS ANOTHER 144 SCALPER CONTRACTS GCG1 AT 1812.4 OR AT BREACH OF 1814.5, OCO, GTC
*We get a partial fill.*
*GCG1 -- DONE AT 1814.7 BOUGHT 37 (OF 144 CONTRACTS; GTC UNTIL COMPLETELY FILLED)*
*We get a complete fill.*
*GCG1 -- DONE AT MUCH BETTER 1811.9 BOUGHT 107 (OF 107 CONTRACTS OUTSTANDING ON THE ORDER) -- FOR ALL FUNDS. *
robert.p.balanModeratorLeaderOwnerNov 27, 2020 9:52 AM
I said -- "Gold is now acting the inverse of yields (as should be) so we do have an edge here." --
TNZ0
GOLD (XAU)
robert.p.balanModeratorLeaderOwnerNov 27, 2020 1:53 PM
There could still be one small uptick in NQ-- 12,220/40 area-
robert.p.balanModeratorLeaderOwnerNov 27, 2020 2:22 PM
Long gold trades stopped below 1806. Waiting for details from DCC.
GCG1 -- DONE AT 1804.20 -- SOLD (EXITED) 288 CONTRACTS GCG1 SCALPERS BOUGHT AT 1811.8/1814.7/1811.9 -- FOR ALL FUNDS.
bogeygolfNov 27, 2020 2:31 PM
was your stop targeted?
gdflondonNov 27, 2020 2:34 PM
Robert, at what point do we hedge this long gold exposure - seems to be in freefall but don't want to hedge at the bottom
nffmendoncaNov 27, 2020 2:34 PM
Are the hedges orders (especially the 1500 ES) already put in the order book or DCC was told to wait?? If not you might get targeted, the price it´s not that far....
robert.p.balanModeratorLeaderOwnerNov 27, 2020 2:41 PM
Mr. Mendonca -- I think our gold stops were targeted, as well as the stops of many long gold trades -- which were as low as 1796 (DCC).
I asked DCC to pull out all the big number hedges and general hedges -- the PBs are going nuts.
nffmendoncaNov 27, 2020 2:48 PM
That´s the right thing to do Robert, they´re hunting you!!! These guys are already pushing up pre-market, going for another up day (why not, there has only be like a gazillion days of up!!) they are sniffing your orders...;)
robert.p.balanModeratorLeaderOwnerNov 27, 2020 2:59 PM
Gold at this point is very well correlated with TN futures, and inverse to yields -- so this dump is totally unexpected. Yields have been falling and TN futures rising.
sparketNov 27, 2020 3:10 PM
MOTUs taking advantage of low volume, perhaps?
robert.p.balanNov 27, 2020 2:42 PM
I asked DCC to pull out all the big number hedges and general hedges -- the PBs are going nuts.
jdonoNov 27, 2020 4:30 PM
You might want to broadcast this in trade summaries. Those big hedge orders are still active for those who get their order information there.
robert.p.balanNov 27, 2020 5:06 PM
They are pulled out from the PB Mr. Dono, but active -- levels not just provided by DCC to the PB. You of course understand why we are doing this, right?
jdonoNov 27, 2020 5:26 PM
I do. Thank you for the clarification.
federergoatNov 28, 2020 4:26 AM
robert.p.balan Have a great Thanksgiving weekend! Hope December will be a great month to finish the turbulent 2020!
jadejetNov 28, 2020 4:38 AM
Same here. Let's burn that barn to the ground Robert.
robert.p.balanModeratorLeaderOwnerNov 29, 2020 9:55 AM
We will do all of that guys. Thanks for your kindness.
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During the first TEN months of 2020, PAM delivered phenomenal real-dollar trading performance, the best at Seeking Alpha:
PAM's flagship Swing Portfolio, year-to-date (October 31) delivered $103, 997, 327.54 profit on $2,172,813 capital. Year-to-date performance: 4,686.29%, on 787-83 win-loss trades. Year to date 2020 spreadsheet here.
Two other PAM funds: Algo Portfolio and Seasonal Portfolio (private) year-to-date (October 31) delivered even better performances.
More details on the SWING PORTFOLIO October 2020 performance here.
SWING PORTFOLIO's September 2020 performance here.
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