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Friday, April 15, 2016

Polemic's Pains with two clever paragraphs


Polemic's Pains - that shouldn't happen. On the market's breakout:
Whilst SPX had been oscillating around 2050 my attention had been drawn to more exciting things, namely Japan. My last post was looking for a turn in Nikkei and JPY and we have been amply rewarded with Nikkei now 7% higher on last weeks lows and USD/JPY slowly grinding back up through 109. But the lack of commentary associated with the rises has me feeling that we have a setup much like the lows in SPX in February that saw the moves higher start with accompanied reasoning of 'just stops’ which then became ‘this shouldn't be happening' to finally end with a 'this is mad, it'll happen one day' grumpy squaring or pushing of losses from the short term book to the long term book. Until we see the weight of opinion move from 105 USDJPY expectations and associated Nikkei dumps, we still have plenty of room for pain on the up side. Meanwhile this is the worst type of reversal for bears, one that just happened without intervention or big news to pin it on, leaving the theory unchanged but the price hurting. Theory 0 - Price 1
Yup, the sure-thing dominant narrative has to get screwed or else this isn't a market.

And I liked this bit:
The skill is to to be able to trade against your core long term view and not be clouded by a dogmatic long term view, even if it does turn out to be reality. In the end we will all be dead but that doesn’t mean we buy coffins and dutifully lie inside them waiting for the day to arrive. There is fun to be had in the meantime.
"Buy coffins and dutifully lie inside them waiting for the day to arrive" sounds like an accurate portrayal of all the goldbugs like Gary Wordsalad and their desire to stick in the gold stocks as the S&P 500 screamed 100% higher.

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