KEEPING AN EYE ON GROWTH

We’re far enough along in this rally that people are gravitating solely towards riskier instruments.

Take a look at these charts…

Growth stocks are in a full blown uptrend and value stocks are in a downtrend.

Is this the stage where you look at your portfolio and decouple from old man stocks?

Maybe you sell some $MO for some $MOMO? Some $DD for $DDD?

MOOD SHIFT

It’s fair to say that in this leg of our beloved bull market, not many took advantage of prices offered in late 2015 – early 2016. Even when the headlines of January 2016 were “sell everything” and “worst start for markets in history” people wanted very little to do with fire sale prices.

Lol.

Even while the market trended mostly uninterrupted in 2016, the attitude was “fuck it, it’s rigged anyway.” Supposing that’s true, it’s a compelling argument to not participate in a market that only goes higher because you have a good conscience.

Lol.

So now that the angle of this trend is steepening, it represents a shift. In the rear view, it’s safe to say that late 2015 and early 2016 was an accumulation phase. That phase leads into public participation phase. That phase takes awhile to take those that chose market abstinence and condition them towards impregnating every single stock that offered a downtick…sorta like I’ve been doing over here for years now.

With the stories of $AMZN, Bitcoins, $TSLA, $FANG’s…etc there are more reasons for folks to step out into the unknown and donate their money to market. This phase takes time, and it’s a very strong current that can lack rational movements, decisions and defy odds. It’s important to remember that while all this action is so very tempting, the exit is always smallest at the slightest sign of change.

Moving forward, I still like the idea of using market sentiment metrics to determine where things overheat. It’s quite likely that this might be hard to gauge, since there will be things we haven’t seen a whole lot in decades.

Enjoy the ease and simplicity, but try to think above the crowd level. Environments like late 2015-early 2016 don’t give me anxiety, because nobody wants to buy. However, these environments give me lots of anxiety. I hate it when more and more people want a piece of the action.

Good day.

GETTING MY HANDS DIRTY

Let’s play a game of Turd Roulette. I’ll kick off a focus group this week for those like myself, with nothing better to do.

Here are my top few findings so far from my trash bin search…

$IDRA

$CBAY

$ATEN

$VNET

$GRPN

I’m starting with a round of poo, before I go total shit list.

What’s your best idea here given the genre?

ENTER THE TRASH PHASE

Mid-May is where I like to adjust my approach to sniff out the shittiest stocks I can find and use them to fund my summer activities.

Today, I am starting with $KNDI, which is right in line with my China theme, and is on the cusp of breaking out.

Over the next few months, when you see some tickers that instantly make you want to vomit, you’ll know why I’m pursuing this as a strategy.

Bon Appétit.

I CALL GAME

My long in $PBYI just paid off big time this morning. Closed half at $63 from $32, leaving the other half for early retirement.

May 22, 2017 10:08 AM ET (BZ Newswire) — Press Releases

Puma Biotechnology, Inc. (NASDAQ:PBYI), a biopharmaceutical company,

announced that the U.S. Food and Drug Administration (FDA) posted briefing

documents on its website in preparation for the May 24 Oncologic Drugs

Advisory Committee (ODAC) meeting scheduled to review PB272 (neratinib)

for the extended adjuvant treatment of HER2-positive early stage

breast cancer.

ODAC is an independent panel of experts that evaluates data concerning

the efficacy and safety of marketed and investigational cancer

treatments and makes appropriate recommendations to the FDA. Its

comments are not binding, but are considered by the FDA in its

decision-making process.

BUYS INTO THE WEEKEND

As discussed in After Hours with Option Addict last night, I bought $BIDU calls at the open. I’m still holding the position I bought on 5/4, which expires next week. That hold pretty much had me shitting my pants on the regular this week.

I also picked up $PI calls and loaded into some $SNAP.

I’m stepping into these longs knowing there’s a 50/50 we revisit the lows of this week. Not the best odds, but I like what I picked up that much.

My week could have been insane had I waited for the washout to buy my weekly calls. I’ve added $COF, $EDIT, $BLUE, $BAH, $SFUN, $KNDI, $VNET to my watchlist next week. We’ll discuss these set-ups at the close today.

Have a good weekend,

OA

EYEBANGING BRAZIL

The names $EWZ, $PBR and $VALE have come up recently in discussions about Emerging Markets.

I have no desire to have any exposure to Europe right now, despite Barron’s telling me what a great and crowded long this is in the market right now.

Speaking of which, I closed out my Feb $FXE long yesterday.

I do like Brazil though, and today’s action seems like the perfect reason to step up and invest.

I’m rooting for a market selloff into the weekend. If that’s the case, I’ll start with some shares of $VALE for the long term.

Anyone buying into this stuff today?

OA BUY: $ONVO

I managed to snag $DDD calls a couple weeks ago, the day following their earnings miss.

I’m adding $ONVO here, which has the same pattern that the others had prior to liftoff.

More later,

OA

BEATEN MERCILESSLY IN RETAIL

The Stock Gods we’re displeased with my mention of the breakout in retail last week. Now, I am being tested holding positions….watching big unrealized gains transform into lunch money over just a few short days. Especially SHLD…but this situation seems all too similar to early 2012. I’ve been a huge Lampert fan ever since.

I’m convinced there’s more left to this recent run in various names, otherwise I’d head for the hills.

I bought some $CMCM today and on the fence about taking off $VIPS calls into earnings. I’d be risking a double, but naturally I want more.

I missed $NTES and $MULE today which rendered my day pretty much worthless.

Hope you’re fairing better than I am. Most of you, anyway.

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