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Wednesday, March 8, 2023

Stock Market Update Wednesday, 3/8/23 - Energy, Gold Miners, $VIX, Gap Fade

  Absolutely killing it this week!

Saturdays perfect call - linked 

Just looks like a gap fill, for now. 

Continuing on the same theme, where I identified how last Friday's short squeeze was pulled off:

One thing I didn't mention is how the $VIX was utterly destroyed on Friday, and for no apparent reason. You usually see this type of thing, on breaking news, for instance if Russia were to suddenly pull out of Ukraine, or if the Fed were to suddenly pivot, and start buying treasuries again. 

This just proves that we can no longer trust the $VIX, as a sentiment indicator, like we used to.   

I suspect daily options - which seems to be a thing now - are being used to manipulate the $VIX. I don't have any proof of this, but considering that $JPM, and $MS, both pointed to this, when warning of a possible Volmageddon 2.0" (event), tells me, they see what's going on....  

I see how the $SVXY (the 2X Leveraged $VIX Bear) is being used to drive the $VIX lower. I would love to reveal the chart, in order to prove my case, but this chart is too valuable to just give away, and it would reveal a stop-out point that could be used by the short sellers, to take the market down. I'm not here to provide help to the market manipulators. 

Leveraged funds being used to manipulate markets

Jim Cramer used to talk about how leveraged ETFs were being used to fuel the crash of '08, but today I can find no reference to those remarks.  

I'm still not 100% sure this is possible, but I do see these leveraged ETF's being bought at strategic points, as I pointed out - on the $WEBL - on Saturday.

This article from Reuters seems to debunk the theory that a leveraged ETF can move an index 

Short ETFs under microscope as SEC pounces - 2009 reuters 

 But it is unclear how much influence ETFs have on the underlying assets, to which they are only indirectly connected. Further, the SEC’s initial recommendations target the selling of borrowed equities, whereas ETFs involve the buying of funds.

I  have a love/ hate relationship with these leveraged funds. I like to trade them, but I see them used nefariously all the time, and that leads me to another "case in point". 

The Energy Trade I called out a few weeks ago. 

Feb 6th: It was just after the close, and I saw a possible long trade in energy, and I pinned the tweet that evening, which just happened to be the day before Feb. Options Expiration 

Tomorrow's Trade: If they sell Tech, then they will drive Energy higher. $GUSH

— Veteran Market Timer (@3Xtraders) February 16, 2023

The next morning I blogged: 

GUSH (3X Oil and Gas producers) continues to trend higher 

Note: Gush is probably the riskiest thing I'm throwing out there, but if tech is going to sell-off, then the trend has been to pile into energy. 

See:  Market Update 2/17/23 - Friday, Feb. 17th, 2023 - OPEX (Options Expiration)

Of course this gave the hedge funds plenty of time to pull the rug out on that trade, and no sooner than the market opened, you can see what happened... on the chart (below).

 $DRIP (3X Leveraged Oil & Gas Bear ETF)  - bid is raised (rigged) above the 50 day moving average! This is no coincidence! 

Now does that look like a breakout you want to hang your hat on, or was this an opportunity to take other peoples property? I'll leave that for you to decide, but this I can tell you, the breakout didn't last, and today you'll find the bearish trend on $DRIP continues. 

Who do you think raised the bid on $DRIP, while hammering Energy down 3%? I believe it's the hedge funds I rip, every day, because I know how these idiots think, and to tell you the truth, many times I'll call out a trade out, just to see if they're paying attention... lol 

How do you like me now?! 

Did you really think I would pile into a 3X leveraged Energy Bull ETF, after alerting to the fact that the sector has remained in a bubble for the past several months?!  But I digress

 And now you know the rest of the story, and why it isn't safe for me to alert to trades in real time. There are sharks in the water! 

I wish I could be of more help, but many times I'm torn between trying to not give too much information away - in order to protect my own positions - and other times like on that Friday, the unexpected happens, and I'm left scrambling to make my own trades. 
 I actually ended up making upwards of a dozen trades on that Friday, in 5 different sectors, and spread out across 3 different accounts, not even including Forex, which is a lot for me! 

I had like 42 open windows spread across 4 screens, to give you some idea.... 

If you're looking for a high risk reward trade I see gold miners getting ready to retest support. 

Good luck, AA 

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