Wednesday, December 21, 2016


on CNBC today (the hype continues):

Dow 20K is just the 'tip of the iceberg' for this bull market

Here's the No. 1 reason the Dow is on the cusp of 20,000

Market rally should continue for a good part of 2017, strategist Paulsen says

Trump rally could be like Coolidge's Roaring '20s

So many hedge fund managers, analysts, institutions, etc were shaking in their booths just a couple months ago.  They've been getting increasingly pessimistic about stock prices ever since the sideways consolidation that began in 2015.  On Tradersutra, we've been expecting an upside breakout and a roaring end of year rally based on the lousy sentiment.  Well things are finally turning the corner in a huge way.  I am expecting not only a correction, but something much larger afoot, stock prices should start cascading down in early 2017 and undo the entire bullshit "trump" rally, which is an erroneous label by the way.  This rally has been driven by mega short covering, chasing of performance, and the final salvo of retail money succumbing to the subversive machinations of the financial media.

Monday, December 19, 2016

CNBC's website is lit with over the top bullish headlines

Here are just a few of the zany headlines on their site just for today:

America's wealthy are pumped about investing with Trump: CNBC Millionaire Survey

'The Big Short' star says go long and load up in new 'golden age' for financial stocks

This chart shows we could be entering the best stock picker's market in 10 years

How much strategists expect stocks to rise next year


We've finallly reached the tipping in point in bullish sentiment as extreme as the negative sentiment was on CNBC all year leading up to the election.  

A massive correction is on the way anytime between now and the end of the first quarter.

Trump himself said the stock market is in a massive bubble, now these millionaires and portfolio managers are loading up the boat at these levels?  i don't think so.

Wednesday, October 19, 2016

On the Heels of Round 3

Let's see how debate 3 shapes up.  Debate 1 was such a disaster for Donald that Hillary rose up purely by the mere fact that she showed up, but the less she speaks and the less the camera is on her face the better.

Debate 2 on the other hand was a big victory for Donald.  The orange bozo was so buried in shit in the days leading up to that second debate yet he really turned things around and trounced all over Hillary, focusing all the scandals on her rather than him.  The worst moment of the whole debate was when they were asked to bring up one positive thing about the other candidate and Hillary bombed again, a terrible way for her to end a debate:  She complimented his offspring of all things. How lame is that!  Hillary always tries to take the "safe" way and lie through her teeth.  She doesn't have the balls nor the sincerity that Donald has.  Of course she doesn't like Donald's kids!  I mean, who does? That boring automaton Ivanka and Donald douchebag junior?  Cmon, really?  She shoulda replied that Donald's one positive quality is his hair.  That woulda been a great note to end it on, that if he keeps objectifying women, let him get a taste of it, and to drive further the point that if his intricate orange comb-over is his best quality, then he must have no redeeming quality whatsoever.

When Donald replied that Hillary's positive quality is that she just doesn't give up, that was obviously a quip rather than a compliment.  You could see he was driving home the point by adding that with all her jailworthy scandals, one after another, she still had the insanity to continue to run for president, when any normal person under the weight of that much criminality would step down. Big points for Donald here.  Funny enough, Hillary smiled when he "complimented" her, ever oblivious to the fact that he had absolutely nothing positive to say about her, and definitely not about her family, who Donald has repeated are all degenerates.

Wednesday, October 5, 2016

Debate HIghlights

Hillary and Donald Debate Highlights:

Well, I think Hillary was the clear winner here.  But let's be honest, all Hillary had to do was just show up, that's all she had to do.  And of course, not get carted out mid-debate in a coughing fit.  She did way better than that, she showed up, in all her polyester pantsuit glory, and didn't even cough once!

For every point Hillary brought up, Donald's retort dug his grave even deeper.  First of all, on the case of racism against blacks in his early landlord days.  He said that he settled that case by paying the hefty fine and "not admitting to guilt".  OK, everyone knows that in the legal system, if you can afford it, you can buy your innocence.  Donald didn't ever deny that he racially profiled African Americans.  His reply to Hillary was that he "didn't admit to guilt."  Also, he made the excuse that many other landlords racially profiled and that they were all defendants in the suit, therefore it was ok for him to do it because he wasn't the only one.  What a great precedent for someone who's supposed to be a leader and running for the highest office of the country!  This also harks back to the rowdy Trump rallies where Trump encouraged the crowds to bash up the protestors and it was OK because he would pay the victims' medical expenses.  Yeah, money buys everything.
Then we come to the case of Trump's treatment of women.  While I think Hillary just gabs at the mouth most of the time and rarely says anything meaningful, i have to say i was impressed when she brought up the beauty pageant and Trump's disgusting behavior around women.  
It's quite ironic that the Donald can parade around like a fat slob everywhere even though he's running for the highest office of the country, and yet a woman who wins a beauty pageant is not allowed to gain weight.  Such hypocrisy, but if you're a man, in Trump's eyes, and you're white and rich, then you can do whatever you want, but if you're a woman you're basically a pig unless you conform to Trump's chauvinistic viewpoint of what a woman ought to be.
The whole concept of the beauty pageant is disgusting, and to think a leader of a country would condone this, the clear objectification of one gender over another in such a domineering patronizing way.  Just look at Trump's kids, how he raised them, both his sons look like douchebags in the most classic sense.  Ivanka, geez, she looks like a cardboard cutout, she even talks like a robot.  Trump might be a big personality himself but his kids seems to have no personality at all and zero charisma, i think anyone can attest to that.

TraderSutra: Why Credit Spreads are a stupid idea if you don't know what you're doing, actual case study

TraderSutra: Why Credit Spreads are a stupid idea if you don't know what you're doing, actual case study

Why Credit Spreads are a stupid idea if you don't know what you're doing, actual case study

This is an email (copied and pasted below) that landed in my inbox yesterday, a day before gold broke below its 3 month support level of around 1308 and free fell over 2.5 standard deviations in just 1 day.  Yes, i got an email from "The Strike Price" and their "Chief Options Strategist" Andy Crowder on "How To Make 14.9% in gold over the next 2 weeks."  That was the title of the article, verbatim!  Well, this article very quickly proved "How to Lose 100% of Your Money in Just One Day".  I don't know who these people are, i never heard of "chief options strategist" Andy Crowder before and I'm sure I won't hear his name again.  You know these services, they're a dime a dozen and they all like to spam your inbox.  This one by far was the worst of the lot.  I'm sick of all these punters who talk about making measly percentage gains of a few percent claiming 80-85% success rate with credit spreads.  What Andy Crowder doesn't tell you in his spiel is that 14.9% return is based on your capital at risk, which means you are risking almost 7 times what your potential gain is, that's terrible risk reward.  Oh, but we're talking about an 85% probability of winning, so it's ok.  Gimme a break. This is just how dense these people are.  The probability of these trades working is actually far less, and Andy's analysis is so simplistic, obtuse, and uninformed.  His rationale was that oh gold is oversold, oh look at my trusted indicator the RSI....geez, what r u in 3rd grade????  you're gonna base risking 7 times the loss based on a frickin RSI?  Did you look at the COT report?  no... Did you look up the demand out of china and india?  no!  Did you read my article just a few days earlier about how the dam is about to crack any day now in gold and swing the floodgates wide open?  about how more calls were being bought and stacked on with every down move, sending up contrarian warning flags?  no your brain lacks that sophistication.  Did you even study the chart pattern of gold and acknowledge the clear bearish descending triangle?  of course you didn't even do that.  Andy Crowder, shame shame...

How to Make 14.9% in Gold over the Next Two Weeks
By: Andy Crowder
Tuesday, October 4, 2016
As a special service to our readers, I will be offering a free webinar tomorrow (Wednesday). It will be for educational purposes (with several live trades) to throw some light on my process and strategies when trading weekly options.

Today, I want to go over a trading opportunity in Gold (GLD). I will also go over the today’s trade in far greater detail in the upcoming webinar tomorrow, including my risk parameters. 
In this special issue I’ll also reveal some of the key aspects of knowing when to make a trade.

Trading Opportunity in Gold
Let’s examine how a weekly options trade works using one of my two approaches.
The commodities market – more specifically gold, is in a “very oversold” state again, according to my favorite mean-reversion indicator, RSI.
Once I see confirmation of an oversold state in one of the highly-liquid ETFs I follow, like GLD, I immediately look for a trade.

With GLD trading for roughly $125.11 and in a very oversold state, I want to use a strategy like a bull put spread. A bull put spread will enable me a margin of error just in case the current short-term directional trend – in this case a bearish trend – continues.

The next step is to choose the actual spread. I want to start by looking at the Prob.OTM column in search of a probability of success around 85%.
Above is the November options chain for GLD. I always start with the probability of success. I’m only interested in trades with a greater than 80% probability of success.

After I find the odds I like, I then look at the premium. I know lots of options investors struggle with how to choose a specific strike. My advice is always to calculate the yield on cash or yield on margin to gauge the percentage you’ll earn.

If I were to choose the strike price closest to 85%, I would need to sell the 119 strike. However, since I would need to buy the 117 strike which would only bring in a premium (bid price – ask price) of $0.18.

So, the next step is to move further up the options chain towards the 120 strike. This lowers my probability of success to roughly 81%, but it allows me to bring in an ample amount of premium to make it a worthy trade.
I can sell the 120/118 bull put spread for $0.26 ($0.59 – $0.33). By selling the strike with a slightly lower probability of success, I am able to make a return of 14.9%, compared to 9.9% by selling the 119/117 bull put spread. The margin of error on the 120/118 bull put spread is $4.89. Again, the decision always rests with how much probability of success you want to have on your trade. In this case, we are going with an 80.97% probability.
As long as GLD closes above the 120 strike at November expiration, the trade will receive the max profit of 14.9%. But remember, the goal is to take the trade off within a week or two, hence the weekly options trade. Yes, I will integrate weekly options trades with only 7-14 days left until expiration, but this has been my method as of late. Anyway…the break-even point is $119.74, which is the strike price of $120 minus the premium received of $0.26.
Again, given the extreme oversold nature of GLD, I am comfortable pushing forward with the trade. Again, I will go over this trade and most likely 3 to 4 more in the upcoming webinar on Wednesday.
As I said before, I do things a bit differently than most people when trading weekly options. I do not make a trade every week. I wait for overbought/oversold extremes to enter the market and then I begin to look for a trade.
All of the numbers can be confusing, but if you focus on the probability first, and then calculate the yield, you can more easily gauge whether the trade makes sense for your portfolio.
In this case, we’re looking at a 14.9% gain in 45 days, with an 80.9% probability of success.
I encourage you to familiarize yourself with the tools made available to you by your broker. If they don’t offer them, consider switching brokers. Once you get used to the kind of baseline income that’s available from different options scenarios, you will start to recognize the difference between good, average and bad opportunities – and you’ll become a better trader.
And one of the most important aspects of trading is being able to make that kind of informed decision.
For us to randomly select a trade based on the fact that it is Thursday or Friday, or any specific day for that matter, is irresponsible. The market doesn’t work that way. I mean, what’s the hurry? Why do we need to make trades every week, especially for arbitrary reasons? We are in this for the long haul, so let’s take a more methodical, long-term approach.
Again, on Wednesday I will be discussing in far greater detail my approach to weekly options. If you would like to learn more, please click here.

During this event, I’ll be going into much greater detail about this GLD trade, as well as 2-4 other income trades you can make live, during my event.
Andy Crowder
Andy Crowder
Chief Options Strategist

Thursday, September 29, 2016

Blueprint for swing trading gold to yearend

A lot of gold punters out there, getting awfully crowded. Apparently in a zirp universe, gold is the world’s savings account, too many presuppositions here and questionable premises. Gold bugs like to bring up the correlation with the dollar but that in reality holds little water when you look at the actual historical relationship.  Price is ultimately driven by demand, not by correlations.  Right now it's a fear driven trade, the fundamentals don’t back it up, the physical mkt is not as hot as the paper mkt, demand is actually contracting in india and china, in india the govt has been implementing controls to curb demand, sometimes these take time to filter through.

Additionally, the commercial hedgers, who tend to have an informational edge over the other mkt players aka dumb money, are at record short positions, while the specs are at record highs. These conflicting forces have kept gold at bay, spiraling in a sideways trajectory since July that will ultimately end in tears.  

My strategy is to buy put spreads on the leveraged gold products, the more leveraged the better, as these will see even greater velocity to the downside.  The problem is these products don’t have much of an options complex built around them, so rather than take what the mkt gives you, you gotta name your price which means the chance of fills is low.  Your edge is not only directional, but is further availed by the inherent dysfunctionality of these products.  These leveraged etf's reside in the far reaches of the liquidity spectrum for equities, where there’s little to no viable liquidity.   You’ll have to give the mm’s their pound of flesh but I do not recommend splitting the bid and offer or get hosed.  The vol premiums are high, so structure these as bear put spreads, going slight OTM for the long side so you'll rack up intrinsic quicker, and around 20 delta for the short leg.  Gold has been bumping up against the downward trendline setting for an ideal entry point for at least a pilot position.  As it’s coming off it again, there's been a build in call activity, a disaster waiting to happen, when the dip is bought as long as gold continues to precipitate downward. Can wait for confirmation of a break through the compression lows to size up with spreads.  No need to build the position out yet, stacking on risk while still in consolidation as the time decay continues to drain out of these junkers, but when you see gold on the cusp of the acceleration is the time to size up, that's when the trade moves onto the dancefloor.  

As for the market, i think it is setting up for a ripper of a ride, 2017 will likely mirror 2013.  Too many traders are all beared up.  We’ve been consolidating at the highs for over a year building up alot of bearish angst that i believe will ultimately get released in a bollinger blast to the upside.

Thursday, June 30, 2016

Another dumb uninformed article from CNBC / Wall Str Journal

CNBC claims machines had advantages over humans in Brexit trading because they are not "emotional" and that humans have "projection bias" and "hope" for a positive outcome.  Totally uninformed crap.  Here's the link:

This article is total BS.  People weren't guided by "hope" for a positive outcome.  Most traders i know love chaos in the markets because there's the possibility of making money if the mkt collapses rather that melts up. There is no "projection" bias crap in this case, rather just a lot of polling propaganda that steered peoples' expectations into thinking bremain would win out.  Fact is that a lot traders thought there was no way brexit would win, that even in the small chance brex woulda won that they would've RIGGED the polls in favor of EU.  Also, no one thinks bremain was a positive outcome for anyone but the elites and stock markets.  And lastly i will add, this article is misleading, most algos actually lose money, they are programmed by losers in general, and the code has to be constantly tweaked.  

The big winner that keeps getting carted out in the media is Soros.  But they fail to mention that Soros trades on insider information and loves to capitalize on world destruction.

As far as CTA's winning because they have computers trading for them, ridiculous assertion.  Big CTA's put hedges on before a big binary event to balance out their deltas and hedge their long book.  The vix started spiking 2 weeks before the referendum, prior to that the S&P options had volatility premiums way in the low end of their spectrum.  Big hedge funds were buying OTM puts when they were cheap.  Doesn't take a computer / genius to figure that one out. 

Tuesday, June 28, 2016

Gotta love this rather Dickensian image that accompanied CNBC 's brexit article yesterday.

Alot of gloom out there, as conveyed through above illustration, with Frexit on tap and then of course you got Guixit and Spixit up on deck.

When the people have nothing left, they have nothing to lose, something the elites have not quite grasped.  So no matter what threats and bastille-like scare tactics the euro-loyalists proffer, they have yet to face the consequences that in a corporate welfare system where all the wealth gravitates to the privileged few, that the hungry masses are apt to rebel and will be trepidated no further by the establishment propaganda (which is always demoralizing and condescending to the proverbial "little guy").  These are Jacobin times upon us.

Of course, the only ones who are about to lose, and lose in a massive way, are the big financial institutions, the ultrarich, and the multinationals.  England, a feudal backward little mess of an island, the hallmark of the middle ages, is very important for the financial elite.  London is a portal.... a portal through which numerous offshore tax shelters are setup.  A nexus of nefarious banking activity. Command control center for the international banking mafia.

People may be celebrating now for the plebeian victory over the Eurofascist beurocracy tyranny, but the arena is large and this is just a small campaign in a much larger battle.

Behold the fourth reich, better know as the European Union

Thursday, June 23, 2016


Gold could take a hit tomorrow, post-brexit poles, and if it does, it could be potentially massive.

What we have have seen over the course of the past couple months in this gold consolidatory bull flag formation is the highest number of speculative buying since the 2011 gold highs, and the commercial hedgers have built up record short positions in gold.  That doesn't mean much on its own until you take into account that physical demand for gold has been falling in India and elsewhere and it's only the speculative paper demand that is rocketing higher. 

Early summer is a seasonally weak period for gold.  The speculative call option buying will be unwound if gold fails to rally which will exacerbate the gold selloff even further.

Gold is particularly vulnerable at this juncture to coordinated efforts by bullion banks to push the price down knowing it will trigger an avalanche of selling by the speculative dumb money.

In any event gold tends to rally for all the wrong reasons, as desperate fringe elites like jim rikards, james turk, etc etc and all the punters you find on sites like King World News, never up for a real challenge, try to make the case for $10,000 gold so that they can line their pockets in a frenzied bid for low hanging fruit.