While the Global Trading Dispatch focuses on investment over a one week to six-month time frame, Mad Options Trader, provided by Matt Buckley, will focus primarily on the weekly US equity options expirations, with the goal of making profits at all times. Read more
While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more
Global Market Comments
October 17, 2016
Fiat Lux
Featured Trade:
(MARKET OUTLOOK FOR THE COMING WEEK),
(SPY), (TLT), (TBT), (GLD), (USO),
(MAD HEDGE FUND TRADER HITS NEW ALL TIME HIGH),
(FXY), (YCS), (FXE), (EUO), (TLT), (TBT), (VIX)
(GRAPES OF WRATH REPLAY),
(TESTIMONIAL)
SPDR S&P 500 ETF (SPY)
iShares 20+ Year Treasury Bond (TLT)
ProShares UltraShort 20+ Year Treasury (TBT)
CurrencyShares British Pound Ster ETF (FXB)
CurrencyShares Japanese Yen ETF (FXY)
ProShares UltraShort Yen (YCS)
CurrencyShares Euro ETF (FXE)
ProShares UltraShort Euro (EUO)
VOLATILITY S&P 500 (^VIX)
For all of 2016, financial markets have traded off of the assumption that gridlock would continue in Washington, DC.
Markets hate change, and love the status quo, predictability, and certainty.
Last week that assumption was turned on its head, thanks to the complete collapse of the Trump presidential campaign for reasons I am sure you are all too well aware of.
Clinton is now even or ahead in all 14 battleground states, many by double digits, and her standing in the polls is soaring like a hot Silicon Valley IPO.
Suddenly, the prospect of Democratic control of the White House, the Senate, the House of Representatives, and the Supreme Court has been thrust under the noses of traders and investors everywhere, and they don?t like the smell.
This would represent change and in a big way.
Although still unlikely, here?s what such a game-changing outcome would deliver:
* The next three Supreme Court nominations, creating a liberal court for the next 40 years.
*Higher taxes for the wealthy, lower taxes for the poor.
*More regulation of banks through an updated Dodd-Frank.
*Regulation of pharmaceuticals through an Obamacare upgrade.
*Limited gun control (full autos, large magazines, silencers, and enhanced registration requirements for those on the no-fly list and the mentally ill).
*An end to Citizens United which permits unlimited anonymous corporate campaign donations.
*Voter rights will be expanded for minorities.
*Women?s health rights will be expanded in the most pro-choice manner possible.
*Globalization continues, with the Trans-Pacific Partnership (TPP) renegotiated and passed by another name.
Maybe Trump can pull his chestnuts out of the fire at the last presidential debate in Las Vegas on Wednesday, October 19.
But I doubt it.
If anything, he is likely to be more abusive, shrill, threatening, and deranged than in the past. At this point, he has nothing to lose.
Can Hillary stand up to Trump?s withering fire? We?ll find out soon enough.
Markets are waiting with baited breath.
Certainly the Las Vegas debate will be the preeminent market risk event of the week.
Monday, October 17th at 9:15 AM EST, we get September Industrial Production which was a yawn last month, but should show an improvement this month.
On Tuesday, October 18th at 10:00 AM EST we learn the NAHB Home Market Index.
On Wednesday, October 19th at 8:30 AM EST, the September Housing Starts are published. We?ll see how quickly rising mortgage interest rates are slowing the housing market.
The all important Fed Beige Book is out at 2:00 PM EST, giving us yet another read on the economy.
If you have trouble sleeping at night, the final presidential debate will keep you riveted to your TV screen. That starts at 9:00 PM EST.
On Thursday, October 20th at 8:30 AM EST we get the Weekly Jobless Claims which should confirm that employment remains at four-decade highs.
Friday, October 21st at 1:00 PM delivers us the Baker Hughes Rig Count. Worryingly, the trend has been up for the past 15 out of the past 16 weeks.
This should help cap oil prices for the short term which is what my (USO) trade is all about.
All in all, I expect us to continue trading in narrow ranges into the presidential election. Then, watch out!
Good luck and good trading.? Keep your hard hat on.
John Thomas
The Mad Hedge Fund Trader
It?s been a tough-fought battle. I have had to fight tooth and nail for every penny.
For the first time since September 2nd, I have been able to boost the six-year track record of Global Trading Dispatch to a new all time high.
It seems these days, you have to work twice as hard to earn half the money with more volatility.
We had an outrageous August, taking in a lip-smacking 7.52% profit.
?
I began this month with the assumption that financial markets would remain trapped in narrow ranges.
September was problematic, with my Trade Alerts essentially breaking even, up only 0.27%.
So I narrowed my focus to the short-term trading of the violent day-to-day swings we are seeing in the market.
It worked like a charm.
After a long dormancy, the Volatility Index (VIX) climbed out of the basement, seeing single day moves up to 40%. That enabled me to reel in two quick winners with the iPath S&P 500 VIX Short Term Futures ETN (VXX).
My brother in arms, Mad Options Trader ?Whiz?, has done even better on the volatility front.
Since then, I have been trading like a Mad man, fading moves in the S&P 500 (SPY) and the United State Treasury Bond Fund (TLT), and then taking profits in days.
This week, I cast my net over a broader range of asset classes, buying the SPDR Gold Shares ETF (GLD) and selling short the United States Oil Fund (USO) on top of the latest OPEC-induced spike.
Both positions turned immediately profitable.
Keeping a death grip on every dollar I take in, I am now running very tight stop losses. This has lead to an irritating jump in small losses, but has enhanced my profitability over all.
Keep in mind that this is an environment where almost no one is making any money at all.
I tell my financial advisor and long term investor friends to just turn off the TV, as there has been very little net movement in asset classes over all.
Things will be better in a year.
It is impossible for them to catch these short-term moves, let alone explain them to clients.
I expect this state of affairs to continue until the November 8th presidential election.
What we are getting is not a ?price correction,? but a ?time correction?, whereby prices grind sideways before breaking out to the upside.
This brings my 2016 year-to-date performance up to an enviable 16.81%, compared with 4.65% for the S&P 500. The trailing 12-month return is 18.25%
My six-year return now reaches an eye popping 208.49%, delivering an average annualized return of 35.75%.
These are numbers that any financial advisor, hedge fund manager, or retiree trading their retirement accounts from home would kill for. Most are losing money this year, net of fees and expenses.
Those who have made the effort to wake up early every morning, read my witty and incisive prose and actively trade my proprietary alerts have an impressive row of notches on their bedpost to show for their endeavors.
?
My groundbreaking trade mentoring service was first launched in 2010. Thousands of subscribers now earn a full-time living solely from my Trade Alerts, a development of which I am immensely proud.
Some 50% of my clients are over 50 and managing their own retirement funds, fleeing the shoddy, but expensive services provided by Wall Street. The balance are institutional investors, hedge funds, and professional financial advisors.
The Mad Hedge Fund Trader seeks to level the playing field for the individual retail investor. Looking at the testimonials that come in every day, I?d say we?re accomplishing that goal. To read the plaudits, please go to Testimonials.
Our business is booming, so I am plowing profits back in to enhance our added value for you.
To subscribe, please go to Global Trading Dispatch.
And now, for the rest of the year.
I can?t wait!
John Thomas, CEO
Mad Hedge Fund Trader
35.75% Average Annualized Return Over 6 Years
It?s another sign of the times when the weekend fruit picker population is doubled by people hard hit by the economy, looking to save money on food costs.
After driving through miles of undulating brown hills studded with oak trees, passing mile upon mile of horse ranches, rusted out cars, and abandoned mobile homes, you come to bucolic Brentwood, the fruit capital of Northern California.
There, thousands of families, half of them Asian,? harvest ripe Bing cherries and peaches at the wholesale price of $1 a pound, fruit that normally costs $6 a pound at the supermarket.
It all is a great opportunity to teach young kids the value of hard work, and where their food comes from.
Anything you eat in the orchard is free, an old California tradition. No doubt none of these people are counted in the government?s employment statistics.
It all a sign of the snowballing ?local? food movement, where California has been a leader.
It is? a great deal if you don?t mind having purple fingertips at the end of the day. Just watch out for the cars pulled over on the side of the road on the way home, their occupants puking out all their excess cherries.
In a nod to the 21st century, growers in this ?Grapes of Wrath? industry compile lists of email addresses, and notify their itinerant fruit pickers which crops are ready for harvest via the Internet.
Also on the calendar this season are grapes, apples, apricots, plums, loquats, nectarines, mandarin oranges, and wheel chair accessible walnuts (?).
At the end of each harvest, professional crews sweep through and pick up what?s left, if the prices will bear it.
If you wonder why we put up with the earthquakes, high taxes, gridlocked politics, and a non-functioning state government, this is the reason.
By the way, does anyone know what to do with 50 pounds of cherries? Send me your recipes. I already bought an automatic cherry pitter on Amazon.
Thanks John...rough ride out of the gates here...but I wouldn't want to be riding with anyone but you...you are my life raft in this treacherous world of investing, and thank you for being who you are and for all that you do.
Take care,
Greg B.
Agoura, California
As a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what should be bought, when to buy it, and at what price. Read more
As a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what should be bought, when to buy it, and at what price. This is your chance to ?look over? John Thomas? shoulder as he gives you unparalleled insight on major world financial trends BEFORE they happen. Read more
While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more