Jennifer's avatar
$22.4m follower assets
Climate Bill - A Decade of Support for the Transition
Many have been skeptical about industry's ability to meet the government's hastily imposed regulations for the energy transition. Around the world, billions of dollars in tax credits & funding are being doled out to assist in meeting the requirements for a carbon-free world. The Barrons article linked below shows why a rapid transition might actually be possible, but it will require a significant increase in the production of minerals & metals.

  • Europe: grants/incentives >$200 billion, REPowerEU plan aims to double the region’s solar capacity in just the next three years, with capacity to power more than 100 million homes. Wind and clean hydrogen will get enormous subsidies, too.

  • US climate bill in the U.S. $370 billion for clean-energy incentives and consumer benefits. Wood Mackenzie projects that the incentives will trigger some $1.2 trillion in private investments by 2035.

  • The bill boosts tax credits for battery storage, EVs, heat pumps.

  • Tax benefits for CCS/CCUS $CVX $XOM are both working on carbon-capture projects & $OXY is a large player.

  • The magnitude of demand for hydrogen electrolyzers would get fairly immense quite quickly. We don’t have many companies that have that technology, and even fewer that have the technology at low cost.

  • Solar power will be the workhorse of the energy transition, powering the electric grid as well as fuelling hydrogen production and filling battery storage. #silver #vanadium

The commodity super-cycle has only just begun.

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PCE Deflator, More Earnings: Daily Contrarian, July 29
Good morning contrarians! Stocks look to resume their rally after positive earnings from $AAPL and $AMZN

Today’s main economic data release is the PCE deflator, out at 0830. Economists expect a 6.8% increase to the headline figure, which is ahead of last month’s 6.3%. The core figure, which excludes food and energy, is expected to increase 4.7%. That would be identical to last month’s number.

Watch for: A small increase is baked in to the headline figure. So don’t believe any headlines that say it rose “unexpectedly.” But the core figure is more important anyway.

Earnings include $XOM, $LYB, $CVX, $NWL, $CL, $CHD, $PG, and $PSX.

Am monitoring $SWK after it dropped 16% yesterday. More on this in the podcast, available here:
Erick Mokaya's avatar
$102.4m follower assets
$GOOGL just has to be the top pick for the next 40dys. So lock up on this stock. I need the advance's when it stops $2k in September start
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Irish Born Investor's avatar
$23.4m follower assets
15th June 2022 - Trading Journal
Today's trading journal is brought to you by IBKR. I use them as my main brokerage for both investing and trading. As a European investor I have tried several different platforms and I can safely say they have the most comprehensive platform available to any EU based investor. In terms of platform power, safety and products (Stocks, Options, Futures etc.) You can check out the platform here.

Situational awareness:
Note: June 10th all my stops were hit and some trades I actually cut before the stop was hit: $ZM & $SHLX to be precise. The market action was dire and in times like this it's best just to step aside.

June 13th & 14th: I made some day trades - shorting $DOCU, $HES & $CVX intraday for opportunistic small moves with size on a heavy downtrend day. June 14th I had a small win on another intraday trade with $LI on Chinese strength.

Not much pre work was done on these trades and I find they are difficult for me to do consistently on a daily basis but in short hits here and there when the trade is very obvious or good RR I'm okay with it to give me a small green day when there is no point in looking at swing setups.
Pre Market Work:
With the FOMC meeting today I will be simply waiting to see what happens with that. I have been studying the $SPXC this morning for a potential "scenario". This is mainly just an exercise but nevertheless here it is.

When the market has these moments such as the Fed Meetings or catalysts it tends to make a quick fake move one way in the minutes after the announcement or news then reverse the opposite way. This could happen hard today. I have no idea which way that will occur if it does however here is a potential.

We make a quick red move after the meeting then hard rally upward toward the 3900 area. This would catch a lot of people offside and the market likes to do that. The reason for the 3900 area is the gap and the 10MA.

Or maybe the market plummets. Who knows. If i was to trade this scenario I would be using the current market low as my area to trade against. That way the risk is managed objectively and the upside is great in terms of RR. 10:1. If the stock moves up instantly and you miss your entry well then that's that. Never chase.

Again this is scenario building out of interest.

------------

In other notes a lot of names were reset but Chinese stocks are still looking like they are making interesting moves. $PDD & $LI in particular.

Trading Day:
I eventually took the $SPXC trade using Mini Futures. I executed it fairly okay. It could have been done better but the idea played out to perfection. This was the only trade I took today and moved my account almost 3% with an excellent RR and risk in check.
End of day Thoughts:
In trading you do not even need to be right 50% of the time. You can become a multi millionaire being wrong 80% of the time once the odds are skewed in your favour. If I can flip a coin over and over and receive 2 Dollars every time I hit heads and only lose 1 Dollar ever time I hit tails I will compound. Now imagine you win 3, 5 or 10. That coin flip can actually be rigged against you in terms of win rate and you will still come out ahead.

Stanley Druckenmiller says SIZE SIZE SIZE when you see your opportunity skewed heavily in your favour. Pradeep Bonde calls it picking up free money.

That is the essence of trading and getting that mindset.
Notes & Open Trades:
  • No Positions

Please note I operate my risk with options that I can lose 100% of the premium. This is the safest way to trade them in my opinion. Even if I cut at 50% once I am setup to lose 100% within my risk threshold then I will stay ahead of my required R:R.
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Irish Born Investor's avatar
$23.4m follower assets
Opportunistic Day Trade - $CVX
Day traded $CVX short today. Which isn't what I'm about these days but on very directional days like this when everything is coming down and I'm clearly not going to be trading swings then I don't mind.

I prefer these sort of Shorts than any other form of day trading. They're quite obvious and the risk is easy to manage. The problem with day trading is you usually need to anticipate the move somewhat unlike swing trading where you can afford to wait for a break of a certain price and you don't have to be in in seconds. In day trading you are on such fine margins that every cent counts. Which is why I find it unsustainable. Never the less here is the trade. I shorted at the top of the bar with the arrow and closed the trade near the bottom of the bar.

Because it's a day trade I am comfortable using very large size (+margin) knowing that I have about .30 cent per risk per share on a solid probability trade. I'm in and out 3 to 1 risk reward. Moving my stop down to breakeven minute after the trade moves my way and peeling into the weakness.

The problem with these trades is they are difficult on "normal" market days. Days like today are not too common.

Sharing out of interest not as advice!
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"The problem with day trading is you usually need to anticipate the move somewhat unlike swing trading where you can afford to wait for a break of a certain price and you don't have to be in in seconds." Pretty much nailed on, also it is probably almost impossible for anyone with a 8-5 to be a day trader (unless you have a nice job :) )
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Crack Spreads
Crack spreads measure the difference between crude oil as an input and heating oil as well as gasoline as outputs -- in other words: what do refiners pay for crude vs. what can they sell the products for.

The spread is trading at record highs, fueling the rally in refineries -- more here: https://www.bluelinefutures.com/insights/post/421/

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