Nightly Briefing 9/21/20


Even though we triggered weekly sell signals today, the Fed is capable of producing a double top into October 21st. Violent, counter-trend rallies are possible due to monetary intervention. It is not something we like to rely upon. We will sell TQQQ on strength short term and wait for more weakness, most likely the 200 DMA test by October 5th for a tradable bounce. Global stock markets may plunge after October 21st into early December more than 20%. It is time to reduce position size and be nimble, focusing on short term trades only. We will have a great ICL buying opportunity, the best entry possible, in late November/early December. We will short the ICL decline later in the month. Expect violent counter-trend rallies as the Fed attempts to buoy markets into Election Day.


Our system and computer have been incredible at calling most of the curves in the market since the Covid crash. We had an 80% probability of a short term intra day low on Friday and 20% Monday/Tuesday. Hence, TQQQ was triggered. When big money senses a bottom, the first assets you will see purchased are SOXX, QQQ and biotech. We may have more choppiness tomorrow but a bounce into month-end should occur. Risk remains high and we may exit TQQQ sooner than expected, as 3,290 SPX was breached sooner than expected. This tells us markets are weaker than we anticipated and caution is warranted. There is a high probability of a dip down to the 200 DMA: SPX 3100 and 10,200 NDX.


SPX 3100 is in play for the first week of October. A short 3-day plunge should occur, which is the norm for these QE infused markets. The moves down now occur as mini crash events when the Fed takes a breath and the dam finally breaks. Modern trading has never been more treacherous if you are not prepared for these. Near term, a bounce into September 28/29 looks likely with the market picking up steam after tomorrow.


We received many emails regarding gold and people stressing about not having positions the past week. We hope everyone followed our research and remained patient. Bottoms are a process and this one will take a couple of weeks to complete. We will have a blood bath phase at the end of it, $1750-$1800 target. We will have a great entry price for our gold trade into the next peak in December - $2300 futures. Gold (GLD) will be preferred into this peak over SLV and GDX.

Weekly charts are now confirming our AI outlook of blood on the horizon for gold.


Steel stocks can rally in choppy markets. Today, most steel stocks took a hit on a large dollar rebound. CLF reports earnings Oct 25-29. This quarter is normally the best quarter of the year for CLF. Iron ore remains at multi year highs at $127. Iron ore is a large component of CLF's business.

October is our rocket month for SPCE. The start of a run-up should be a matter of days away.


Our AI Targets are normally hit as evident over the past several months. We expect our yearly target for UNG to be hit over the next 30-45 days, $17+. It too can rally in a declining stock market and has had a habit of doing so over the last decade.




This past Weekly Briefing covered the significant potential of Illumina. They just completed an $8 billion dollar acquisition today and issued restricted stock, a short term negative event. This is a great long-term buying opportunity. Their proprietary test kit is essential today in finding the mapping sequence to virtually all diseases.

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. 

 

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