I’m with a bunch of family in Florida right now, so I’m going to write a quick post and leave it at that. Out here you still see masks here and there but many aren’t worried about it.
Nearly half of the US population has at least one shot of the vaccines. The CDC said that vaccinated people don’t need to mask, and no one is going to check so pretty soon all those rules will be gone – unless some new variant gets around those vaccines I suppose.
Last week we saw significant down moves in the major US indexes with gold, silver, and uranium holding pretty strong.
Friday was the typical “vol-crush” bounce and I bought a couple of 1-week QQQ puts in the last hour of trading. Some of the people I listen to more on Twitter are warning of downside, and the Elliot Wave people I follow say we could be completing a wave 5 down. This won’t lead to a major selloff unless a significant hedge fund blows up, so I’m planning on exiting my short trade at the first decent drop. If I’m wrong and markets rocket higher, I figure they’ll pull up my miners with them so I’m not worried about being out that put money.
This was peak inflation month because next month we’re comparing year-on-year numbers with last year’s fresh $1400 stimulus running through.
I’m still in the deflation camp in that I think long term treasury rates will hit new lows in the next year. However, I can’t deny that precious metals are breaking out on the charts while TLT has shown an ominous bear flag formation – so I think the metals are going higher while interest rates may re-test their recent highs in the intermediate term. On Monday I sold off some of my TLT calls (I still have a heavy position) and put the money in gold and silver miners – and I picked up a decent bit of UUUU and a touch of URG later in the week.
If TLT tests those recent lows, I will reverse that move and reduce gold and silver for long dated TLT calls again. However, I’m planning on staying long the miners for a while yet because I really believe they are going for a multi-year up-trend. When TLT spikes again, the whole market will be struggling and I’ll be re-allocating that capital at that time.
I predict an exciting trading week next week. Now I need to break off for some family BBQ and more beach fun.