Weekend June 26, 2021
Regular readers are aware that we have been patiently waiting for a reversal in the ascent of bond prices. It appears to be getting underway now, I could still b e a week early but look at the four hour chart.
I bought some Sept 27 call options for just $23 each Friday. Again I may be early but
PMO is turning up
RSI has moved up at top
And price has moved over the downtrend line
The daily chart has not turned up on PMO but is close.
Energy
USO has doubled inprice since November. PMO and OBV are pretty well topped out and this is a weekly chart. The CEO of Continental Resources told Maria Bartiromo oil could go to $100 but of course that is what he would like to see happen as it is in his interest. Oil is both a financial and economic etity. A column in the SA EN today attempts to analyze price in terms of supply demand but that ignores the reality of sheer speculation, the kind that has driven AMC and Gamestock to new highs despite not making any money.
MEME Stocks
Our weekly column noted that SPX NASD are making new highs without any support from positive social mood, at lest in politics.
However Tom McClellan notes that a ffalling VIX Open Interest stat is not indicative of a top, we need to see that before looking for a market top.
Notice the stats on GME the latest non money maker thrill stock. The one year range is 3.77 - 483, simply unheard of. And there is no P/E as there are no earnings, in fact a hefty loss fo $#1.93.
GME
Does this look normal? And notice volume has pretty well dried up as well.
We have said it before but the combination of buying money losing stocks GEM, AMC, bitcoin fantasies, SPACS, electrice car companies not selling any electric cars or trucks
are all features of an advanced market, not one set to repeat the Roaring Twenties.
SPX
Frankly I don't know what to say about this now, PMO at bottom and OBV at top are maxed out but as Tom points out VIX open interest is falling Throw in that it is summer and well
after May go away. I like the idea of betting on lower bond prices rather than buying any stock at this price level.
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