Adding VXX, TZA, QID and TSLA News
Internal measures between various indexes continue to diverge, which is
very bearish and while such diversions do not always mark a major market top these are always evident at major market tops.
Technical measures also continue to deteriorate.
Per a post made late June titled "Adding VXX, Mocking TSLA" we finished restoring our previous full complement of levered market short positions (3 in VXX and 3 in TZA), several of which we'd sold for massive gains earlier this year.
See here and here.
We're now adding a 4th position in VXX as well as in TZA and seeking to open an effective NASDAQ short position via QID.
We'll buy VXX when it trades at $29.00 or above.
VXX looks especially good right now, as it has not made new lows in the past two weeks while stocks have shot much higher. In fact, it closed slightly higher today.
If there’s an “undervalued investment” out there, it’s arguably short-term future volatility via VXX.
We'll buy TZA when it trades at $8.20 or above.
We'll buy QID when it trades at $37.10 or above.
We'll be grossly overweight in these positions, however have no stops in mind for these, or prior, effective market short positions.
Admittedly that's imprudent and definitely not what most, or perhaps anyone else, should do, however for us extreme situations preclude extreme measures and we believe with sincere conviction that stock markets are at historic extremes that will soon enough be reversed in equally extreme fashion.
Why do we keep harping on Tesla?
Actually we barely scratch the surface here on the ongoing circus at Tesla, and as we've stated previously we believe the stock will suffer an epic collapse and the cult-like hero-worship of its celebrity CEO will suffer similarly.
Movies will be made and books will be written because, as we've also stated previously, we believe the stock will come to be known synonymously with the market plunge that will also occur in tandem with (though not because of) its eventual failure.
What can be learned from this is that epic amounts of cognitive dissonance and willful suspension of common sense and value metrics are always present as long as prices remain aloft. This is very true currently of stocks in general.
For market bulls and Tesla longs, "these are the good ol' days".
Reuter's: Musk's U-turn on Tesla deal could intensify his legal, regulatory woes
Contrarian Edge: Questions I'd be Asking If I Owned Tesla Stock
We are short Tesla.
Technical measures also continue to deteriorate.
Per a post made late June titled "Adding VXX, Mocking TSLA" we finished restoring our previous full complement of levered market short positions (3 in VXX and 3 in TZA), several of which we'd sold for massive gains earlier this year.
See here and here.
We're now adding a 4th position in VXX as well as in TZA and seeking to open an effective NASDAQ short position via QID.
We'll buy VXX when it trades at $29.00 or above.
VXX looks especially good right now, as it has not made new lows in the past two weeks while stocks have shot much higher. In fact, it closed slightly higher today.
If there’s an “undervalued investment” out there, it’s arguably short-term future volatility via VXX.
We'll buy TZA when it trades at $8.20 or above.
We'll buy QID when it trades at $37.10 or above.
We'll be grossly overweight in these positions, however have no stops in mind for these, or prior, effective market short positions.
Admittedly that's imprudent and definitely not what most, or perhaps anyone else, should do, however for us extreme situations preclude extreme measures and we believe with sincere conviction that stock markets are at historic extremes that will soon enough be reversed in equally extreme fashion.
Why do we keep harping on Tesla?
Actually we barely scratch the surface here on the ongoing circus at Tesla, and as we've stated previously we believe the stock will suffer an epic collapse and the cult-like hero-worship of its celebrity CEO will suffer similarly.
Movies will be made and books will be written because, as we've also stated previously, we believe the stock will come to be known synonymously with the market plunge that will also occur in tandem with (though not because of) its eventual failure.
What can be learned from this is that epic amounts of cognitive dissonance and willful suspension of common sense and value metrics are always present as long as prices remain aloft. This is very true currently of stocks in general.
For market bulls and Tesla longs, "these are the good ol' days".
Reuter's: Musk's U-turn on Tesla deal could intensify his legal, regulatory woes
Contrarian Edge: Questions I'd be Asking If I Owned Tesla Stock
We are short Tesla.
We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.
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posted by C. Guinness @ 6:23 PM
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