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SPX - Do PIGs FLY?

BLUF: Extended...OverExtended, Who Fookin Knows? Get some insurance/leverage! We ALL Know Pigs Fly, but at some point they Fall out of the Fookin Sky! Pull up a chair and grab a cold beer, Let's watch the ShitShow!

"Do or do not. There is no try." Yoda

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hedgopia.com/already-extended-sp-500-begins-2020-with-a-bang-investor-sentiment-exuberant/

Chart 3 pits the 21-day moving average of the CBOE equity-only put-to-call ratio with the ISEE index. Barring divergences here and there, the two for the most part move together. Unlike the CBOE put-to-call ratio, the ISEE index is a call-to-put ratio, hence inverted. It excludes trades from market makers and brokers/dealers, and only uses opening long trades. Market makers need to hedge exposure all the time. Retail traders on the other hand bet on direction. Many consider the ISEE reading cleaner of the two.

Early September last year, the red line in the chart hit an all-time low of 105.1. Thursday, it closed at 155.1 – a two-plus-year high. The green line similarly ended Thursday at 0.56 – an 18-month low. This will get unwound. It is not a matter of if, but when. The deeper these metrics get into extended territory, the higher the likelihood of a painful unwinding.

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FIND-FIX-FINISH!!!

"US' Middle East policy has largely failed. It paid costly price of life and money in Iraq and Afghanistan. But a pro-Iran regime has emerged in Iraq, Taliban has recaptured influence in Afghanistan. Eliminating Qassem Soleimani won't solve US' dilemma in the Middle East."

What environment are we in? Know the pivot points...HEAD SHOTs ONLY!!!

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The FOMC minutes will attract attention. Investors know that 13 of the 17 Fed officials anticipate that no change is rates will be necessary this year. The real interest will be on color around the repo operations. There is hope that more details about how the Fed will approach the challenge. Is it close to establishing a permanent repo facility to match the reverse repos? What about the $60 bln a month of T-bill purchases that are to run into Q2? The answers may not be forthcoming in the minutes, primarily because the Fed itself probably does not have the answers yet. The playbook is still being written. Separately, five Fed officials speak today: Barkin, Daly, Evans, Kaplan, and Brainard. Only the latter two vote (The voting power rotates to Kaplan and Brainard is a Governor). --Marc to Market

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Let's look at the Whole-Puzzle...Narratives overexaggerate while markets knee jerk...once the dust settles reflect (Decisional Space)

READ:
Razor-Focus-Situational-Awareness
Extrapolate Out the BullShit
Assess the Environment We are In
Digress for a Most/Better Strategy

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