Nightly Briefing 6/16/20



The overbought conditions will need to be worked off with some choppy back and forth action over the next 7 trading days. Small traders need to be flushed out of positions to allow sentiment to reset and become a bit more bearish so we may climb the wall of worry again. This is how modern markets move.

Great news for the stock market today! It appears the larger correction we mentioned (scenario 1 from last night’s report) is a less likely possibility. Anytime the Federal Reserve chairman testifies before congress expect a good day in the stock market. Markets today were also aided by a headline regarding an old steroid drug that is being used to minimized Covid-19 complications. Expect back and forth into the middle of next week, but no collapse. A trending rally should develop toward the end of next week into early summer. Currently, ignore the saber rattling between China/India and the Covid spikes. The Fed is the only thing holding the global economy up and the stakes are quite large. Do not expect them to stop helping the markets as the global economies mend from the forced shutdown. At the end of the day, the Fed will buy stocks if they have to. The economy will not be shut down again.

We were questioned by many people in early April regarding our market projections into May and June. The same people are calling for a crash or a retest but they will get the same result into July: higher equity prices. Ignore the noise.



Thursday into early next week appears bullish for bullion and the miners. Silver is currently weaker but should get some traction. Silver is fighting a dominate cycle that will pull it down into the end of next week, possibly along with gold.

Based on the levels regained today in the SPX we did not elect to trade out of our restaurant stocks. We show the weekly chart of DENN above and its uptrend is very much intact.

The weekly technical picture of our two restaurant stocks could not get any better.


The next two weeks you will see the bulk of the country reopen its restaurants for unrestricted dining. As the end of the quarter approaches, there are only a few pockets of value left in the marketplace. If you want to pay for a year of your Hedge Fund Z membership many times over, just continue to hold DENN and in particular BLMN. Hedge funds are beginning to pour into these names and won’t stop until July 1 as they chase alpha into the end of the quarter. We expect these two names to significantly outperform the SPX over the next 3 weeks. They will not creep up every day .50 at a time. Expect 20% of the trading days to account for 80% of the move. We remain focused on the big picture.

We were stopped out of our UNG position today, but remain bullish on natural gas. Today may have been the final flush and bottom. We will continue to provide coverage on it for our members.


We should trigger several new trades we are watching in the coming days with excellent profit potential.

HFZ

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Important Disclosures: Investing in the financial markets can involve considerable risk, including loss of principal. Past performance is not necessarily an indication of future performance.  Actual clients may achieve results materially different from the results portrayed.  All material is for informational and educational purposes only and is not investment advice and is not meant to suggest that any securities are suitable investments for any particular investor.  All information reflects our own actions, beliefs, and processes for purely informational purposes. HEDGE FUND Z LLC IS A FINANCIAL BLOG FOR THE SOLE PURPOSE OF EDUCATION.  HFZ does not represent themselves as acting in the position of an investment advisor or investment manager for funds that are not under their direct control and fiduciary responsibility. 

 

Third party quotes and information may not be representative of the experience of HFZ customers and do not represent a guarantee of future performance or success. Many of the results displayed on our website were achieved using leverage, such as 2x or 3x leveraged ETF's or equity options 

 

The information included at HFZ and HFZ writing, research, and updates is prepared for educational purposes and is not a solicitation, or an offer to buy or sell any security or use any particular system.  Information is based on historical research using data believed to be reliable, but there is no guarantee as to its accuracy. HFZ does not represent themselves as acting in the position of an investment adviser or investment manager for funds that are not under their direct control and fiduciary responsibility. HFZ will not provide you with personally tailored advice concerning the nature, potential, value or suitability of any particular security, portfolio or securities, transaction, investment strategy or other matter.  

 

No information, nor any opinion expressed on the Site or in the Services, shall constitute a solicitation or an offer to buy or sell any securities mentioned therein.  The information presented on the Site and in the Services has been prepared without regard to any particular investor's investment objectives, financial situation, needs, capacity, and trading ability or experience. Accordingly, you should not act on any information on the Site or in the Services without obtaining specific advice from your financial advisors and should not rely on information herein as the basis for your trading and/or investment decisions.  HFZ cannot claim or represent that any of our Services are suitable for you. 

 

By your use of the Site and Services, you're agreeing that you bear responsibility for your own investment research, trades, and investment decisions. Only you can decide whether or not a trade is right for you and you agree to be liable for any trades you initiate at your brokerage using research and/or tools that we provide. If you ignore our advice to do independent research and choose instead to trade solely on information, analysis, alerts or opinions found in our Service or website, you have made a conscious, willing, free, and personal decision to do so. You also agree that HFZ, its directors, its employees, subsidiaries, affiliates, and its agents will not be liable for any investment decision, trade made or action taken by you and others based on news, information, opinion, or any other material published through our Site and Services.  

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