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Thursday, August 10, 2017


“The risks are real & the stakes couldn’t be higher.”

The North Koreans are just crazy enough to start something; the U.S., of course, will finish it. Remember the bluffs and hot words of Saddam Hussein warning the U.S. before the first Gulf War? Yea, that worked out well for him didn’t it? But, if they got nuts and lit off a nuclear weapon somewhere [Japan, South Korea, Guam, or anywhere else for that matter], besides the human toll which would be horrific and off the charts, the economic turmoil would be incalculable as well.

Not that it matters much to the perma-bulls, or the manipulators with the CNTRL-P machine at the ready 24/7 to buy everything in sight, so as not to let it go down. Why yes, simply ignore the economic risk here, and when the missiles start flying it will be like trying to buy fire insurance on your home as it’s in flames.

Which brings us to the other front; a market meltdown. Certainly, if nuclear weapons get detonated, the “Genie” is out of the bottle, and the “Law of Unintended Consequences” takes over, and nobody has a clue what happens next. You can “game theory” it all day and night, and nothing thought off will be what happens if this event unfolds. At this point, the manipulators will most likely back away and let the selling commence and run its course, but when it’s done, look the hell out on the upside. Depending on the ultimate damage, will determine what happens next.

I’m trying to figure out what the pot-bellied dictator really wants; does he really have a death wish, or does he want something from China we don’t know about? Telling the world, though, last night you’re gonna nuke Guam with 4 missiles and warheads in mid-August, seems to be totally stupid? Why tell anybody anything, just do it already. So, it seems to me this is a ploy to get something to stand down … cuz he’s kinda sets himself up to look like a doofus if he doesn’t let the missiles fly, or at the last minute somebody steps in, gives him what he wants, and the world is saved thanks to Kim’s beneficence and grace, “blah blah yada yada”. This is the most likely scenario, but what if this isn’t what happens? It’s hard to say what kind of damage something like this could have on EURJPY … where’s the bottom? If you think you know, you don’t.

Turning to today’s market … well, that escalated quickly didn’t it? First trading day in about 50 the Dow30 actually has traded … too bad they had to clobber it first. Now, after making new lows for the day during the Chicago Noon hour, it’s free to rally … and more importantly, now that everybody has panicked sold, time for the “Plunge Protection Team” [PPT] to show up and crucify shorts with a rip your face off rally … which they promptly did with about 50 points in 15 minutes. EURJPY, the entire day mirroring Dow30 action.

I tried to position the first trade and that was a “no go”, and so went for a bigger trade later at a much lower price … and sure enough, the PPT showed up and rallied it up to and ever so slightly past my liquidation point. Got trapped in a small loss in EURJPY earlier, which wasn’t the algo’s fault, but mine cuz I was about 1 second late hitting the button … no biggee, just sayin’ … all in all, a literal “street fight” today, where it was tough to know what news event, economic report, or panic attack was your friend or your enemy, cuz everything on the board was flyin’ hard and fast.

If I had played EURJPY instead of the Dow30 today, I would have done better, although not by much … that first lower SDEV hit in EURJPY would have resulted in a loss as well as the Dow30, but the rally back in EURJPY was superior in every way possible … lesson learned, and while it was a good second trade, I should have been in the proxy. DAX30, for its part, a complete and utter mess, with 20+ point spikes up and down everywhere … unless you are willing to sit through 50+ point swings against you in seconds [no thanks], this market is untradeable at the moment. All told a complete scratch day, after spending the day swinging for the fences. Except for the bloodbath down for 30 minutes this morning, a very tough trading day, cuz nothing else really happened … some serious chop taking hold along with some spike spurts that were false breakouts [more than likely dealer and bank stop hunts], but not any moves that were lasting. Disappointing there wasn’t some follow through in EURJPY after the New York open … best results here most always come strictly in European session first.

Here late in the day, we are seeing something in the stock indices we haven’t seen in about a year and a half; rallies that don’t hold but get sold hard … this one apparently on a Vampire Squid note to clients that the top is in for a while … the Dow30 was at 21980-ish, now it’s at 21905-ish, all in about 60 minutes of selling; all I can say is “about time”, and it wouldn’t be this bad if the Twits at the FED hadn’t been manipulating it for over a year. This sets up an interesting tomorrow, one that should have our stock index proxy active and volatile. Oh boy, can’t hardly wait! Onward & Upward!

PAMM spreadsheet directly below.

Beach time … the dog and I are outta here. Until tomorrow.

Have a great day everybody!



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