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Thursday, May 14, 2026

Dow Jones Futures Test 50,000 - Dow Transports $TRAN Bullish

We all know the Dow is a dead index, but the sector rotation back into $TRAN (Dow theory) is still very much alive. 

 I recently recommended $TRAN - not as an alternative lifestyle choice, but as the next likely sector rotation, and while scanning my radar this morning, I immediately noticed it being bought - right at the 50 day sma. Consider this your final warning to get on board with this trade. You may also want to consider trading the higher risk/reward, fast money option - namely the 3X transports ($TPOR). If you haven't traded 3X leveraged funds read my disclaimer. Word to the Wise: Leveraged ETFs Are Not for the Casual Investor

Dow Transports $TRAN chart - First thing you'll notice is the recent flash-crash. Crickets from the ever-pumping US market bulls, who tried to sell us on a "broadening out economy". Looks more constructive here - building a base. Counter-trend rallies can be vicious, so sit back and enjoy the show. Note: You might want to check the earning calendar to see what is going to lead the comeback rally. Think airlines, trucking, railroads. Do your own due diligence.    

$TRAN Chart TradingView 

I also recently called out energy (last week was it?), but that trade seems to be languishing. You're on your own there. Check it again, once the rotation out of tech builds a head of steam. This is the same 'ol whac-a-mole rotation that has worked over the past several years. The only time it doesn't work, is in a full-on market crash, which I'm not expecting any time soon. 

Meanwhile the entirely highly speculative, solely AI driven, tech sector is screaming exhaustion, after only a 1 month rally. Even Bloomberg is comparing the latest moves in AI stocks - including Jim Cramer fav. $CSCO (up 20% over-night), to the blockchain party of 2025  - and we all remember how that turned out. Ever wonder why Crypto no longer leads the tech rally - now you know.  Highly speculative AI took it's place, and in the end the unwind will make the crypto crash look like Sunday stroll in the park.  

Today you see the same traders who drove these insane rallies, turning tail, and piling back into copper miners? No thanks. I'd rather hide out in US Treasuries, or trade the German $DAX. 

Yesterday what moved markets? China. Bloomberg was seen blatantly pushing Alibaba - attributing it to the Xi summit - even as it was blatantly obvious that trade had already run it's course in US markets.

 The charts don't lie, talking heads do. 

Trump historic Xi summit 
A certain US bank spoiler: Morgan Stanley immediately turned bullish on China (investing live) - helping to drive the 3X China bull (+6%) in yesterday's trade. Trigger the algos much? I'll trust the trend, and not trust the Chinese surveillance state.  School children seen welcoming (forced to) Donald Trump and co. with high energy enthusiasm I haven't seen since the North Vietnamese took to the the Ho Chi Minh Trail with guns at their backs. 😂 Children who refused to participate immediately had their organs auctioned. Chinese officials couldn't be reached for comment.  

Still want to chase Chinese hyperscalers? You're on your own. 

GL, AA 

P.S. Morgan Stanley was recently seen peddling US stocks in China (nai500.com), so you may want to take their recent upgrade on the $SPX, with a grain of rice.  

P.P.S. Re: The blockchain party that ended in 2025. The same speculative fast money that drove that trade to the moon and back is driving the AI trade, and now you know why Crypto no longer leads the NASDAQ (the only major index that seems to take part in the so-called “New Industrial Revolution"). Hey, I still have a bridge in Chicago to sell, if you're interested - CALL ME!


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Wednesday, May 13, 2026

$VIX Volatility Sold (Short) Market's Recover - Pure Manipulation In Broad Daylight

Yesterday’s 5% flash-crash out of South Korea wasn’t just another headline — it was the kind of black swan that exposes how fragile the AI narrative has become, when a social media post from a government official pulls the rug in the middle of the night - right at the 8000 target (7,999.67). Update on that situation in a moment... 

 South Korean Kospi - picture tells a thousand words. 

If you've been following along for the past few month, then you already know how the powers that be love to short the $VIX [They Can't Short the VIX. Here's How They Do It Anyway], and if you're bearish, (or you're name is Michael Burry) going into another Monthly Options Expiration (Friday), this is exactly what you're up against. 👇   

$VIXY (ProShares 2X leveraged VIX Short-Term Futures Bull) - Hammered at resistance.  This isn't just an ETF wrapper they're shorting. When BIG MONEY shorts the $VIXY ProShares is forced to sell front-month VIX futures to cover. VIX futures drop → spot VIX drops → SPX algos smell lower vol and go full risk-on. Exactly what we saw yesterday.  

Following the $VIXY since 2015

Getting back to what took place overnight in S. Korea; The spillover into the Nasdaq left one of the talking heads at Bloomberg in disbelief that a "Facebook post" (coming out of S. Korea)", could send US markets plummeting, but by afternoon the Nasdaq had lost nearly -2%. But several markets rallied as if nothing was out of the ordinary. Dow higher of course - has become the new normal on days like this. No sooner than the NASDAQ is crushed, algos pivot to the Dow.   

I fired off several Tweets alerting to the triple top on the $VIX (@ 19). Market's quicky recovered. Semis were bought at support. It was a good swing trade. 

$SPX closed in the green as if to say [fill in the blank]  At this point all I can do is point to the absurdity, swing trade it, and have a good laugh, but what really keeps me up at night is not the market manipulation in S. Korea, but the bubble market in the west. Even this morning Bloomberg continue to point to semis as the only game in town, perhaps parroting what they're seeing on the terminal.  

We're in uncharted territory, trading a highly bifurcated market, where compound gains outweigh valuation, or common sense. What could possibly go wrong? 

We haven't traded in a normal market environment since the 2000 bubble — not even close. Every crash is met with more liquidity injections ( they don't need to print the money - just push buttons) markets panic-bought to re-inflate the bubble. Wash, rinse, repeat — until it doesn't work anymore. But as long as the AI story is intact - bulls are happy.  

How much longer can this continue? Probably longer than you might think, and at least into Memorial Day, as volume continues to dry up, is my best guess.     

So long, 

AA

P.S. May 6th - story that received very little attention "Lawyers at M&A law firms among 30 charged by US in insider trading scheme" (including M&A lawyers from top firms) in a decade-long insider trading ring that front-ran nearly 30 major deals for tens of millions in profits. (reuters.com)  Buried the same day it was reported. They don't want to open that can of worms. 

P.P.S. Sharks are now running the table in the daylight. 




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