The Alternative Investor
  • Home
  • TRADING BLOG
  • Current Positions
  • Alternative Investor Strategy
  • ETFs
  • About Alternative Investor
  • Contact

Trading Blog  #2    Wednesday (evening),  January 15,  2020

1/15/2020

 
MARKETS  UPDATE and CRUDE OIL TRADE ALERT  (8:00 pm EST)

Today "phase one" of the new U.S./China trade deal was officially signed. The full text of the trade deal was released late in the afternoon. While Wall Street rallied enthusiastically early in the day, it lost it's enthusiasm in the afternoon with the NASDAQ losing nearly all of its earlier gains (the DOW lost about half of its early gains). It's very possible equity markets were not impressed with this new deal (especially the delay in lifting many tariffs on China) and/or we are seeing a "sell on the news" effect with the market having already factored in the new deal with its recent rally. For these reasons (and the fact that we are near the end - Thursday - of a strong reversal zone), I decided to enter a short position in the NASDAQ earlier today. It looks like the NASDAQ could roll over now, but if it pushes higher into Friday (past our reversal zone), we will likely have to cover this short trade as the market could be "breaking out" instead of reversing. We will watch this carefully and are prepared to be nimble in our trading.

Crude oil made a new low today at $57.36 (Feb. contract chart). A sub-cycle low in crude is due by the end of this week, and prices are now in a good range for that low. There is a good chance today's low was it, or it could push a bit lower into tomorrow (the last day of our reversal zone). It looks like a good time to go long in crude. Let's enter a long position in crude now for tomorrow's market open. We will set a temporary stop loss for this trade on a close below $56. If prices push lower tomorrow and hold that level, we will move the stop loss up to that new low. If prices rally, we will set the low at $57.36. Note that crude oil prices and the broad stock market generally (but not always) move in the same direction. Our long position in crude may therefore be a good hedge against our current short position in the broad stock market. In other words, if crude AND the NASDAQ both rally, the loss in our short NASDAQ position will be offset by the gains in crude. Of course, ideally we want to see the NASDAQ down and crude up (very possible), but should they move in tandem (up or down), they will at least hedge each other. 

​Gold and silver markets are very tricky right now. We've been waiting for a low to buy, but prices haven't quite made it to our target areas. Another concern is the fact that COT (Commitment of Traders) charts for both metals continue to be strongly bearish. For these reasons we will remain on the sidelines of the precious metals for now.







​

Comments are closed.

    RSS Feed

    Archives

    June 2025
    May 2025
    April 2025
    March 2025
    February 2025
    January 2025
    December 2024
    November 2024
    October 2024
    September 2024
    August 2024
    July 2024
    June 2024
    May 2024
    April 2024
    March 2024
    February 2024
    January 2024
    December 2023
    November 2023
    October 2023
    September 2023
    August 2023
    July 2023
    June 2023
    May 2023
    April 2023
    March 2023
    February 2023
    January 2023
    December 2022
    November 2022
    October 2022
    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    December 2014
    November 2014
    October 2014
    September 2014
    August 2014
    July 2014
    June 2014
    May 2014
    April 2014
    March 2014
    February 2014
    January 2014
    December 2013
    November 2013
    October 2013
    September 2013
    August 2013
    July 2013
    June 2013
    May 2013
    April 2013
    March 2013
    February 2013
    January 2013
    December 2012

The Alternative Investor takes no advertising or incentives from any company, institution or investment that is discussed on the website.  Any trading and investing information presented is based on Alternative Investor's independent and unbiased research and analysis of current financial markets.

                                                                                                                                                            LEGAL and DISCLAIMER

All statements and trading/investment information on this website represent solely the personal opinion of The Alternative Investor based on information available at the time of writing and are intended for educational purposes only and are not a recommendation to buy or sell securities, commodities or currencies.  The Alternative Investor is not a licensed broker or financial advisor.  The Alternative Investor presents the trading and investing information on this site in good faith based on his own research into current financial markets but cannot and does not guarantee profit and does not guarantee against any financial losses that result from using this information.  All users of this website and the information presented within it assume full responsibility for their own personal trading/investing decisions and any losses that may result from them.

Trading and investing in any financial market may involve serious risk of loss.  For this reason all traders and investors should never place more money than they can afford to lose in any individual market.  The Alternative Investor monitors several markets and encourages a balanced distribution of funds among them (and others).  The Alternative Investor recommends consulting with a professional financial advisor before making any transactions with financial ramifications.  All trading, investing and financial transactions should always be made in accordance with the appropriate laws and legal regulations in your area of jurisdiction.

The Alternative Investor is an independent researcher and analyst and receives no compensation of any kind from any individuals, groups, companies or institutions discussed on this website.