Saturday, January 30, 2021
XLE - Energy Sector Short Squeeze
A short squeeze has triggered in isolated stock names, and is sure to spread into wider sectors of the market. Short funds are running for cover to reduce risk in heavily shorted areas. The Energy Sector is one such segment of the market likely to see a rapid unwinding of short books.
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"S3 Partners analyst Ihor Dusaniwsky said energy stock short sellers took quite a beating in the past month. Energy stock short sellers endured $6.35 billion in net mark-to-market losses in November"
ReplyDeleteDecember figures
ReplyDelete"Energy sector short interest now totals $27.8 billion, and short sellers covered just $394 million of their aggregate positions during the month despite heavy losses"
U think when xle tops, market tops
ReplyDeleteYes, although SPX has significant problems it seems a short squeeze in certain sectors may keep the market afloat until the squeeze has completed.
DeleteI note there is very low short interest in SPY itself. Only 2%.
For this reason SPX may see upside, but do not expect a melt up in SPX.
SC, so do you see SPX go up next week? Do you see over 3800?
DeleteThere still could be some downside but minor.
DeleteXLE 36,170,000 share current short position
ReplyDeleteOn the Gamestop, Steve Cohen and Ken Griffin are involved. They will want to plan a raid on Gamestop soon.
ReplyDeleteI will wait until they think they have the upper hand.
Reuters meanwhile reporting on the WHO investigation. China accusing US of the Covid.
ReplyDelete"China has pushed the idea that the virus existed abroad before it was discovered in Wuhan, with state media citing the presence of the virus on imported frozen food packaging and scientific papers saying it had been circulating in Europe in 2019."
"China's foreign ministry has also hinted that the sudden closure of a U.S. army laboratory at Fort Detrick in Maryland in July 2019 was linked to the pandemic"
https://www.google.ca/amp/s/mobile.reuters.com/article/amp/idUSKBN29Z0AD
S3 Partners:
ReplyDelete"The Energy sector reversed its year-long price weakness and has rallied significantly in November with the Energy Select Sector Spider (XLE) up +28% for the month. Rumors that sector wide short covering was one of the main drivers for this price upswing are not backed up by short side trading activity. The net change in shares shorted for the over 700 stocks in the sector was $394 million of net short covering and therefore the Energy sector shorts were a negligible factor in the rally. The rally in the Energy sector was primarily driven by long side buying, as traders rotated into an under-performing and under-owned sector of the market"
"Yes, shorts got burned in the Energy sector in November, but no they did not exit their trades in size and cause the November market rally. $394 million of net short covering could not be the catalyst for a month long sector wide rally.
This was not a market wide short squeeze, even with November’s -$6.35 billion in mark-to-market losses Energy sector shorts are still up +$20.28 billion, +56%, in year-to-date net-of-financing mark-to-market profits. With such a large cushion of profits, there no need to rush for the exits and create a tsunami of short covering in the sector, but that does not mean that short sellers will stay in their trades forever.
If the Energy sector continues to rally, we should see more short covering as shorts begin to realize their year-to-date profits and rotate into other more attractive sectors."
The rumours of short covering in the Energy sector in November were unfounded. The rally was primarily driven by long side positioning.
ReplyDeleteShorts haven't covered and now shorts are feeling the heat and pressure having witnessed Gamestop stampede. They are on edge.
New money is looking at sectors to squeeze the shorts.
The next leg higher is likely to be fueled by short covering and it's going to be a spectacular unwinding.
Biggest short squeeze of 25 years is underway.
ReplyDelete"Goldman Sachs says this is the biggest short squeeze in 25 years"
Oh goodie I bought XLE Friday!
ReplyDeleteBeautiful!!!
Deletenasdaq has reached a very important area.
ReplyDeletehttps://www.labolsadepsico.com/nasdaq-momento-clave/
SC,
ReplyDeleteNow that WSB has its sights on precious metals, are you adjusting your target for silver at all?
Bought March 5th $30.50 calls for $1.40.
ReplyDeleteSLV
DeleteXLE calls?
ReplyDeleteSorry SLV
DeleteIf I do an option trade on Energy yes I will use XLE Calls. Later maybe we'll see.
DeleteSilver could pop short term. Gold has already tested it's 2011 high. Silver hasn't come even close. So it may catch up a bit here. I see SLV has high volume last few days. I don't think it's so much because of reddit but if it gives it a buzz ok!
ReplyDeleteI made the call in December to watch Silver.
SCDecember 22, 2020 at 9:52 PM
"Silver may see close to $35 by February."
SC,
ReplyDeleteThanks! Is your long term prediction of $5 silver still valid?
Yes. The previous Silver peak was around $43 in 2011. So although in the short term it can test 2011 highs, as gold has already, it still has issues overall.
DeleteWell we thought there would be a raid on Gamestop and there was
ReplyDeleteOil squeezing higher!
ReplyDeletesc,
ReplyDeletesilver has a small pullback--those options move fast--iu will average in at the proper time. if we close above spx-3826--we should go to new highs.
Demark--had spx-3907---he may get it!
I think the Silver will move but it's more a question of timing. I might do something more later.
DeleteIf it doesn't catch this month I'll look out further March to June. Not a big focus anyway though.
DeleteSc uvxy 12
ReplyDeleteYes
Deletesc,
ReplyDeleteyour buying uvxy?
Let's wait and see if UVXY holds at the 50 day $11.37.
DeleteAha!
ReplyDelete"Russia’s Sputnik V vaccine 91.6% effective"
Gamestomp
ReplyDeleteGamestop may be able to mount another run again. I think about 3 weeks of consolidation next, and then it may be ready at that time.
ReplyDeleteRobinhooders getting robed
ReplyDeleteYes, they get limited and restricted.
DeleteWas 1 then 4 now 100 shares. The puppetmaster.
DeleteRobinhood did raise cash, it might improve now that they are better capitalized.
DeleteBut if they didn't have the capital maybe they should not have been in business in the first place.
sc,
ReplyDeleteRobinhood- made money ---just grew too fast--too many clients --not enough margin!
They fixed it temporary.
They are no different than half of these internet--Fin-tech industry
trade on future revenues.
Give them time!
Yeah, you're right! Let's stay positive!
DeleteRobinhood is growing and hedge funds shrinking
Deletesc,
ReplyDeletelook a the bots--50 points a day in SPX
sc,
ReplyDeleteare you averaging in on the SLV calls or waiting for a better place to average in?
No I'll wait. Silver is likely getting ready for a run $35 to $40, but for now building a base in the $20. It might not be ready yet to launch.
DeleteMattarella not finding united politicians and parties, today decides to give the mandate to form a new government to the former ECB president Draghi. The Italian stock exchange is flying + 2.5% on futures. However, if the thing does not go to an end and the parliament does not vote for it, Italy would end up in absolute darkness right now that the recovery fund has to be decided.
ReplyDeleteThinking badly makes you sin, but often you take it. Matteo Renzi there are rumors that he had a secret mandate from Bilderberg in 2019, to make his partito, as he later did, first support a majority government and then leave it by making it fall by promoting Draghi as president of the technical council to impose assets and assets on Italy reduction of public salaries and pensions, a bit like Greece. Thinking badly makes you sin, but for now everything is happening with a diabolical sequence.
ReplyDeleteThank you, it doesn't seem promising with the government falling into crisis
Deletesc,
ReplyDeleteRobinhood---rumor is they sold 3.5 billion of the business to save the company---ownership was diluted!
Silver might have topped---we will see!
Fin-tech--trades on future revenues
regular --accounting methods -Don't apply
for a reverse we need to close below--SPX-3790
Have a good day!
Retail flooding into the market. It seems Gamestop has spurred massive influx.
Delete"The episode doesn’t appear to have dented Robinhood’s popularity. Its app was downloaded more than 600,000 times on Friday alone, according to analysts at JMP Securities. By comparison, the Robinhood app was downloaded around 140,000 times during its most active day in March 2020, when coronavirus fears sent stocks down sharply."
GUSH starting to light up!
ReplyDeleteWhat is your first target?
DeleteGUSH should see a fresh high above $57. There is a previous peak around $65 last year. GUSH first target about $62.
DeleteDRIP should hit a new low around $15.
sc,
ReplyDeleteI am waiting on silver--i bought the drillers on Friday.
I made money and took profits.
Waiting on silver for now --i will need to average
Please inform me if you average in on the calls?
Ok will do
DeleteSC, at this moment Mario Draghi does not have a majority in the Italian Parliament, these are the current voting declarations of the various parties. The majority of the Italian Parliament in both the chamber and the senate would not vote for it. Draghi still has to consult the important secretaries face to face, but if the right does not vote for him, Draghi will not be able to govern, but if the government is backed by the right, what will the right want in return? I believe that in Germany at this time there is Merkel with long binoculars in the window.
ReplyDeleteI can tell you one thing, what I have always said, for me the black swan on the financial markets will start from Italy. Should Mario Draghi also fail, there would no longer be any possibility for the Communist President Mattarella not to send the Italians to vote. If the Italians vote, as we already know, the right-wing coalition will win and can create important imbalances in Europe between existing powers, on average left-wing powers. Be ready and take a good look.
ReplyDeleteThanks Buck, good insight!
DeleteNothing
DeleteThank you Buck, our Italian friend!
DeleteIn 2022 there will also be a vote in France and Macron has long been losing the confidence of his electorate, especially after the yellow vests. If Italy becomes right-wing, the trigger by emulation will start and Le Pen in France will also oust Macron. The strong European powers do not want the right in Europe and neither do the American strong powers, see Biden and Communist Big Tech. War is on paper and will be played at the polls.
ReplyDeleteWhat the heck just happened to kodak?
ReplyDeleteDid it get halted?
"Kodak (NYSE:KODK) spiking up 32% after CEO Jim Continenza touted on twitter about a partnership with Microsoft (NASDAQ:MSFT) for a business software portfolio that was originally announced in December"
Deletehalted on circuit breaker--short covering!
ReplyDeleteYes, KODK is heavily shorted
Deletesc,
ReplyDeleteUvxy--dropping a point a day---one pop ans drop
Any advice?
Wow uvxy almost straight down... no bounces 😆😆
ReplyDeleteLol exactly!
Deletesami,
ReplyDeletelooks like its filling a gap --lets see what it does-
when it hits 10.60
straight down or bounce!
Noticed that also
DeleteWhen you open a Robinhood account they give you free shares lol
ReplyDelete"100% chance of getting a free stock
When you sign up and link your bank account, a surprise stock appears in your account. Certain limitations apply. Learn More"
SC<
ReplyDeleteuvxy---back to 10.30---never fails --the bots!
Yes. Suddenly the 18 VIX is not so far away...
DeleteUVXY looks like a good risk reward. Bottomed at 10 for a while. I can see it going to 8 if when get to Demarks 3907. Down risk is 20% while upside is 60% plus. I haven't bought yet.
Deleteimo kodk is about to pop....
ReplyDeleteDo you agree?
Big block orders come in and buy the last 24 hours
As you can also see from the Italian MIB index, political parties all over the world are too attached to the high salaries of the parliamentarians who make them up and if they pretend to fight, then in the end for the money, they make peace, so it seems also for new Draghi government. The whole world wants it, it has saved the euro and they still believe it can be the one that will save Europe by setting an example starting from Italy. If Draghi is accepted, a sell on the news could follow the general climb.
ReplyDeletekodk looks good-- cheaper in the 8's
ReplyDeleteSami,
ReplyDeleteJust for the fun of it bought A 12.5 April call
Lets see what it does?
sc
ReplyDeleteUvxy is cheap---any buyers out there yet!
VIX 21. Quite a difference in a week!
ReplyDeleteVIX appears to be forming a beautiful triple divergence on weekly chart MACD histogram going back to May. One more down period will bring it to maturity.
ReplyDeletesc--how far down?
ReplyDeletesc,
ReplyDeleteuvxy--are you looking 8 or 9?
or 6?
This comment has been removed by the author.
DeleteTommy what the fuck u got Obsessive compulsive disorder you ask the same fucking question every day 2 times A-day Lol
DeleteSC, why don't you create a twitter and maybe even discord (if u already don't have)?
ReplyDeleteBecause u can't be a phantom on Twitter or could u
Deletewhat do you mean you can't be a phantom on twitter? You can be on twitter without using your actual name if you name to.
DeleteGirinis, it's a good idea. We're coming up to a sensitive moment for the market. Having more capabilities makes a lot of sense in a fast paced environment.
DeleteI might look to expand on this actually as we prepare for historic volatility. Thank you!
Welcome. There are a lot of traders on twitter who share their knowledge and trading strategies. I will post few accounts here who provide interesting info if u dont mind (not shilling them or anything). @Anbessa100 gives good trading entries on cryptocurrencies, in Jan some altcoins gaved good 50-200% gains, some fo them even more. Other account is @charliebilello, from time to time he posts some interesting info about the markets. I think you could greatly expand your circle of knowledge and followers there
Deleteyes you can choose to be anonymous on twitter as most traders does that there
Deletelou,
ReplyDeleteLove you,
I did start buying in this area!
too cheap!
vix gap has to be filled 18.20
Deletenot this month!
ReplyDeleteJust trade TQQQ It's raise up-and-down
Delete92 to 106 in a few days tommy short it tommy
ReplyDeleteRide the wave. I tried going against it and it sucks.
ReplyDeleteSuccess! We had a great week in Oil. Nice trade for the week.
ReplyDeleteTook profits:)
DeleteVery good, your entry was better than mine!
DeleteDoge coin
ReplyDeleteI'm really hoping Natgas goes. I'm in deep at a big loss. Go Polar Vortex Go
ReplyDeletelou,
ReplyDeleteI tried to buy doge coin through TD ameritrade--at .04 cents---could mot do it --the symbol does not pull--only done through certain exchanges?
You can buy dogecoin and other crypto on the coinsqaure app, here in Canada at least.
DeleteSold GUSH at $57 from $48. Nice call SC
DeleteThank you!
Deletesc,
ReplyDeleteNice run --on gush---in a week or two ---I am guessing that it will be a time to buy drip or just wait for a signal?
we just got Tom Demark's high on a intra-day basis
Nice rung guys!
Yes, GUSH was good, the run is nearly done. DRIP soon. $15 to $20.
DeleteOr can just wait for GUSH to cool off instead.
DeleteShoeted tqqq at 107
ReplyDeleteLooked at a lot of charts this weekend, and most are overextended.
ReplyDeleteSold GUSH $59.00.
ReplyDeleteThis isn't even the short squeeze lol. That comes later hahaha
ReplyDeletebeautiful call on that xle sir...
ReplyDeletelooks like its gonna get up to that 47 level you've mentioned
Thanks Sami!
DeleteSc just read contandio in vix till March, what does it mean, no correction in spx
ReplyDeleteGood observation! Was going to update and mention that as well.
DeleteWe can see some chop. This could be an amazing setup coming because a short squeeze in energy can drive UVXY into a low. The timing with the curve looks about right too. It's all coming together!
DeleteSc u have xle pulling to 39, so market will pull also at that time
ReplyDeleteSome chop I think, but remember there's only 2% short in SPY. It's not moving much either way.
Deletesc,
ReplyDeletethere this is only small chops because of the small .02% short on the SPY market--uvxy --should grind lower as Xle falls back to 39 and then a short squeeze should Bring it Xle ---much higher!
Correct!
UVXY likes this $10 area for now. It'll probably hold around this level for a while but I think a sudden dip will eventually occur and I plan to enter then.
DeleteYes, both XLE and GUSH should start to get quite choppy soon. This precedes a surprise move.
Deletewhy u folks are chewing on energy, the protein has been in biotech.....what a great year.....640% and counting....months ago I tried to give hints but everyone hates an honest credit guy
ReplyDeleteBiotech has been hot. I had some OCGN lol
ReplyDeleteThis market is too hot. I sold a lot today. I plan to accumulate cash. Reached Demark's 3907, top trend line is near.
ReplyDeleteTotally agree. A lot of hype. Especially after Musk the king of hype himself, and that Superbowl. It was all too much.
DeleteSC, what do you think will be the top for sp?
ReplyDeleteIt's a little early to say. SPX tends to like round numbers. Maybe It'll try to test 4,000.
DeleteThere. Cooling off today
ReplyDeletesc,
ReplyDeleteSLV-are You still expecting a pop in SLV by March?
Silver does look to be preparing for a run. We'll see about timing
DeleteSC do you think we will see below 3500 this year?
ReplyDeleteThanks
I have something more interesting in mind. A historic event. I see what is happening and will explain all of this. I haven't said a word yet.
DeleteSC the dollar? From today to summer what do you see?
ReplyDeleteNotice the dollar is perking up. I don't have big expectations by summer but another head wind for stocks.
DeleteSc. Before ah today, vix touched 19.69
ReplyDeleteYes, VIX getting closer and active too. We can see some of the chop I've been talking about.
DeleteGUSH not quite overbought yet.
ReplyDeleteThe run may continue a little more to reach that overbought condition on the daily.
DeleteLouis are you trading RIOT?
ReplyDeletesc,
ReplyDeleteNovember it was 4 bucks---now 36--why do we wait to it shows 10 times on the money----before anyone brings this up???
are we trying to hurt each other --or show each other --how to make money with the market!
I agree and I don't want to distract from our big plays. Louis had mentioned the ticker previously.
DeleteI expect a big drop in sp for summer, the same size as March 2020. Is this the historic event?, Or even somerhing bigger?
ReplyDeleteI agree it might come before that
DeleteThe summer does look exciting in my timing Cycle. Expect action there.
DeleteWe have a few different things unfolding. We are coming into timing for a series of unusual moves.
DeleteIt's not the historic event, and yes much bigger. There's a problem that nobody is aware.
I haven't traded riot recently
ReplyDeleteThanks!
DeleteTrading trxc invu tqqq udow upro
ReplyDeleteShort and long
Oil screaming up 8 days in a row! That is the longest run in Crude this year.
ReplyDeleteThank you for your updates. Any thoughts on BOIL?
DeleteNatural Gas has always been tricky. BOIL could be interesting though because of what is happening in energy. What we would need to know there is what short interest is in natural gas?
DeleteI've tried playing natgas for the last couple of years and had my ass handed to me on a platter. I'm hoping to get a spike in the short term to close out my position. Typically, natgas peaks in Feb. However, longer term, it could be good because of the lack of supply
DeleteA Silver platter that is.
Deletesc,
ReplyDeleteI agree with you, and not telling us to last minute--does not help me , to make us money in the market. please make sure, we know about it, before it happens--i know your busy!
We all need to make money.
If someone has got something --please share it!
or at least hint at the problem or industry to take advantage of: We have a few different things unfolding. We are coming into timing for a series of unusual moves.
louie,
Nice move on RIOT---that one I wish that I bought
Please give me
I have children, I could use the capital gains!
sc,
DRIP and YANG are at lows ----I am guessing that it will not hurt to start building a position at this level?
The GUSH and XLE run should be finishing soon. GUSH isn't overbought quite yet so just waiting to see if that gets there.
DeleteWill let you know on big plans coming up....
DeleteYANG is more bigger picture. Am not that active yet, it's developing.
DeleteReddit Wallstreetbets followers still rising. Now 8.9 million. Gaining about 50,000 to 75,000 a day.
ReplyDeleteTells us the short squeeze theme is still in play, and my theory is it will spill into the broader sectors in time. Retail continues to flood into the market.
GME tried to rally today but it failed. The float does not look to be under control quite yet.
DeleteFor dunnster6
ReplyDeletelooks like reddit is on nakd now.Moved quite a bit today. no advice. worth a look. You asked for something.This is something.Not a pump.They just raised 50 million @ 1.70 selling their bricks and mortar and are going full e-commerce.Naked they sell mostly Lingerie.
thank you!
ReplyDeleteI'd like to puch this lawyer in his face
ReplyDeleteNew chart posted!
ReplyDelete