Since we were in a tactical play around options expiration, signals coming from equities were not very reliable. The only reliable signals were from currencies and commodities, if even those can be called reliable.
First the squeeze in Biotech and Drug names continued strong early in the day. I exited the ENDP long because the LEV did not support the price spike.
I also opened a long SDS when I noted that large players were not supporting the SPY price.
This was also visible on many ETFs such as XLE, which I shorted.
Unfortunately, later in the day, both the SDS and the XLE positions turned against me. I decided to keep the SDS long because I felt it was an artificial print because of options expiration.
However, I exited XLE because oil was bouncing and supporting the XLE stronger price.
Earlier in the day, I also shorted NEM, which showed a negative EV pattern. Gold was also weaker. Of course, the success of this trade mostly depends on gold itself, which is quite volatile. But the EV pattern is very negative, which tends to point to a special weakness for this miner.
The EW trade looks OK for now. I raised the stop.
The ORCL trade is not developing yet. We need to be patient.
As you can see, the portfolio is 80% invested: one long, two shorts and one short gold miners. (Gold miners are not fully correlated with the rest of equities.)
Here are interesting trade ideas for Monday. I have posted below two figures related to these ideas; if I have the time, I will post more on the Forum.
I like BWLD as a short idea. It looks compelling.
