Here's Why There's No Clickbait on 8/24/23

[DrStool]

Here’s Why This Is a No Clickbait Market for Primary Dealers

LEE ADLER 1 - LIQUIDITY TRADER- MONEY TRENDS AUGUST 24, 2023

Please feel free to carry on with your late summer vacation. So what if the kids go back to school. Why should you have to go back to work! Besides, most of our kids are grown. So sit back and enjoy these pre Labor Day dog days.  Non-subscribers, click here for access.

Subscribers, click here to download the report.

Yesterday’s bond market rally appears to be but a brief respite in a relentless trend toward lower prices and higher yields. A reaction rally is nothing new, and isn’t likely to change the fact that a market steadily getting pounded with new supply when dealers are already net long, will continue to see generally lower prices until something changes. Change is xxxxxx xxxxxxxxx current picture, xxxx xxxxx xxxxxx xxxxx xxxxxx future.

That rally in the bond market notwithstanding, there’s no reason to change my long-term xxxxxxxxx view of the bond market. The pressure on bond prices ultimately will exact a price on stocks as well.

However, the key word is “ultimately.” These are not market timing measures. They merely provide context. These measures of primary dealer market risk say yes, there’s risk, but they are not at xxxxxxxxx that suggest an xxxxxxxxxxxxxx that stock prices are xxxxxxxxxxx another major xxxxxxxxxx.

This is just a lukewarm endorsement of the bullish trend in stock prices for most of this year. The pullback of the last month does not appear to be in the context of xxxxxxxxx xxxxxxxxxxx xxxxxxxxxx , either in technical terms or in terms of the liquidity context represented in this data.

All things considered, I can only endorse xxxxxxxxxxxxxxxxxx chart opportunities on xxxxxxxxxxxxxxxxxthe ledger, as opposed to xxxxxxxxxxxxxxxxxxxxxx. Non-subscribers, click here for access.

KNOW WHAT’S HAPPENING NOW, before the Street does, read Lee Adler’s Liquidity Trader risk free for 90 days! Act on real-time reality! 

 

Meanwhile, on the hourly chart of the ES, 24 hour S&P 5oo futures, I have a 5 day cycle projection of 4490-4500. Weaker Than It Should Be Means Worse To Come

The 10 year Treasury rallied yesterday, with a big pullback in the yield. Is that a big deal? Here’s Why This Is a No Clickbait Market for Primary Dealers

For moron the markets, see:

• Here’s Why This Is a No Clickbait Market for Primary DealersAugust 24, 2023
• Weak Week but List Stays Net Positive August 22, 2023
• Weaker Than It Should Be Means Worse To Come August 20, 2023
• Gold and Miners Set Up Ugly August 17, 2023
• One Banking Indicator Is Flashing Bright Red for Stocks August 16, 2023
• I Liked the Buys Better Than the Sells August 14, 2023
• More Supply is Just a Lie But Withholding Weakens August 4, 2023

If you are a new visitor to the Stool, please register and join in! To post your observations and charts, and snide, but good-natured, comments, click here to register. Be sure to respond to the confirmation email which is sent instantly. If not in your inbox, check your spam folder. 

[fxfox]

Regarding Nvidia:

I have no position in that stock. I had signal to go long around 170, but did not take it. My policy is not to spring on a train which has already left the station and accelerates. Done that in the past and got burned. So I either take a signal in the moment I receive it or I watch from the sidelines.

So why did i not take the signal? Disbeleive. That's it. i did not beleive what I saw. In the era of social media and espaically Twitter you have for every index or stock AT ANY GIVEN TIME (good) arguments for and against it. There is for example a large community which is bearish on Tesla since that stock was at 15. Not 150, no, FIFTEEN. Same counts for any major tech stock.

I did not have Nvidia on my radar screen. Here is why: Stock topped in 2002 (interestingly not in 2000), then did fall 90%, recovered, made slightly new all ime high in 2007, then crashed again. Then it really got choppy. At that time - say in 2014 Nvidia to me was "yet another graphics card producer" and it seems that it really was priced that way at that time. From that time on I didn't have it on my radar. Shortly after it began to rise: In Q3/Q4 2015 it took off. Without me.

To make it short:

One can't have everything on the radar all the time. You miss things. Many things. But good thing is: There will always be new opportunitis, just have to be patient. How many new narratives have I seen since 2000? Countless.

Most important thng in my veiw:

Charts rule. Respect them. They filter the noise, espaically on higher time frames. Respect the monthly chart. 

[DrStool]

Looks good to me.

[DrStool]

If they can break below 4439, then the base breakout was a fakeout and we can all get bearish. 

[fxfox]

23 minutes ago, DrStool said:

If they can break below 4439, then the base breakout was a fakeout and we can all get bearish. 

Quite the Sir Prize. Looks like an "in ya face!"-moment for da bulls right now. Like bears had in Oct 22, Jan 23 and March 23.

[DrStool]

2 hours ago, DrStool said:

Looks good to me.

Alrighty then. 

I guess not. 

[DrStool]

Nice sell signal on the hourly for a change. The 5 day cycle projection is 4360. 

[WTF]

NVDA is in a mania... keep it on your radar fxfox, the downside will be just as profitable as the upside.

[WTF]

To quote Mike LaFontaine... "Hey, wha happened?"

[MisFit Kid]

Guess they need a new virus/covid/disease-mandate/vax/etc....

[DrStool]

Impressive. 

I don't know why now. But it's impressive. 

Policy hasn't changed, so this smells like a change in market sentiment. 

It's like the old days. The market decides on its own when to contract. 

The Treasury is still flooding the market with T-bills. Since March, the players have been using them as collateral for repo, and redeploying the cash. But if the crowd decides that it doesn't want to do that anymore. Well tough luck. Game over. 

From beautiful Rouan, France, a place you've never heard of but should visit once in your life on a side trip from Paris, I bid you Bonne nuit, et bonne chance. 

[SiP]

nvidia or another company - it doesn't matter. What matters are the rules. I've been in the markets since about 2004, and I've been lectured that valuations, fundamentals, the macro situation, the business cycle and the principles of capitalism all count. Since the GFC, we have had a denial of all this, including through the actions of central banks. Today, valuations don't matter. What matters are the current manias and trends+money flow. A new wave of mania came from 2020 when people were locked in, got money and started speculating. In addition, mass digitalisation, so-called instant gamification (everything is a game, you score points, etc.), mobile apps, online market pricing, influencers have made the markets one big casino. Thanks to digitalisation, there are no queues at banks. Hundreds of billions of usd flowed out of banks in one day (!) during the sivb collapse.  Why am I writing this? Because no fundamental analysis makes sense. More important are money flows, the current mania. Valuations are absurd but people don't care about valuations. Seriously.

 

[SiP]

As for nvidia I didn't write you back yesterday @fxfox. Briefly. You are, in my opinion, wrong in your assessment of the company. You wrote that you were informed about nvidia's monopoly and being a beneficiary of the geopolitical war.  In my opinion this is only now materializing. Not more than probably a month ago there was information that gpu sales to China would be banned. Before and even now, you can sell these chips. That's why, according to me, in q2 2023 purchases from china were turbo charged (and China is already buying 50% of gpu from nvidia today). So if the ban goes into effect then sales will drop. From conversations I've had, it seems that it was only this year that speculative buying related to China's gpu cutoff started. Note the gigantic jump in revenue that they have the situation now. Of course, purchases are being made by others as well because nvidia has a monopoly on gpu for ai. No one offers such an ecosystem. They have probably 90% of the market for ai computing on gpu. But there is another problem that will cool the development of AI. Most AI applications offer no new revenue at all. It's just functionality that a company has to have in order for its product to be good. There are no business models. I'm not talking about chatbot but many other products.  whole bunch of services are not profitable. At the moment it is like with Uber. Most of AI services are generating losses. A sobering will come like with nft, crypto, or web 3.0 or blockchain. Its the same with data. Most stole the data to create programme. Many legal problems are upcoming. Companies like Openai trained AI  on pirated books, many stole IP.

[fxfox]

3 minutes ago, SiP said:

nvidia or another company - it doesn't matter. What matters are the rules. I've been in the markets since about 2004, and I've been lectured that valuations, fundamentals, the macro situation, the business cycle and the principles of capitalism all count. Since the GFC, we have had a denial of all this, including through the actions of central banks. Today, valuations don't matter. What matters are the current manias and trends+money flow. A new wave of mania came from 2020 when people were locked in, got money and started speculating. In addition, mass digitalisation, so-called instant gamification (everything is a game, you score points, etc.), mobile apps, online market pricing, influencers have made the markets one big casino. Thanks to digitalisation, there are no queues at banks. Hundreds of billions of usd flowed out of banks in one day (!) during the sivb collapse.  Why am I writing this? Because no fundamental analysis makes sense. More important are money flows, the current mania. Valuations are absurd but people don't care about valuations. Seriously.

 

All we can do is follow the charts. Basic stuff like MA‘s, support/resistance, congestion areas etc. Is enough. The rest are good eyes and balls of steal.

[fxfox]

18 minutes ago, SiP said:

As for nvidia I didn't write you back yesterday @fxfox. Briefly. You are, in my opinion, wrong in your assessment of the company. You wrote that you were informed about nvidia's monopoly and being a beneficiary of the geopolitical war.  In my opinion this is only now materializing. Not more than probably a month ago there was information that gpu sales to China would be banned. Before and even now, you can sell these chips. That's why, according to me, in q2 2023 purchases from china were turbo charged (and China is already buying 50% of gpu from nvidia today). So if the ban goes into effect then sales will drop. From conversations I've had, it seems that it was only this year that speculative buying related to China's gpu cutoff started. Note the gigantic jump in revenue that they have the situation now. Of course, purchases are being made by others as well because nvidia has a monopoly on gpu for ai. No one offers such an ecosystem. They have probably 90% of the market for ai computing on gpu. But there is another problem that will cool the development of AI. Most AI applications offer no new revenue at all. It's just functionality that a company has to have in order for its product to be good. There are no business models. I'm not talking about chatbot but many other products.  whole bunch of services are not profitable. At the moment it is like with Uber. Most of AI services are generating losses. A sobering will come like with nft, crypto, or web 3.0 or blockchain. Its the same with data. Most stole the data to create programme. Many legal problems are upcoming. Companies like Openai trained AI  on pirated books, many stole IP.

You sure you mean me? I never wrote that.

Only thing I did write was that I heard weeks ago that China buy s up large amounts of Nvidia chips. It is said they do this because of fears of further sanctions by the US.

My point was: That info was there publicly available since weeks. But traders did not react, the stock did rise further and further. Yet another proof that Markovitz was wrong. The market is not efficient. If it would be it would arbitrage away any mania right at the beginning.