The Donald

Basement Macro isn’t a platform to engage in political jousting. I’m interested in finding opportunities for investment/trading profits, pure and simple! So put your political persuasions aside and let’s try to make some money! As I have consistently opined – whether you love him or hate him, Donald Trump isn’t going anywhere! In fact, I still believe he’ll beat out Clinton – […]

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Capitulation Alert: Bearish USD?

  NFP came in weak, as expected. On the release, $GC1! spiked, $DX1! dove and $ES1! tanked. Again, all par for expectations. That said, no sooner than 6 minutes after the release, $DX1! was already trading higher than pre-NFP. Could that be a signal of capitulation on the bearish dollar trade? Yes, that’s a gutsy […]

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Earnings Options Play: $DATA

$DATA has a recent history of massively underpricing implied volatility! Heading into the last six earnings reports, $DATA options underpriced the next day move by an average of 50%! Talk about buying volatility at a discount!  Right now, $DATA options are pricing in a 13% move, down from a steady 18% move all week. I jumped into […]

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Housing troubles to continue?

Despite lower raw material costs – for nearly all of 2016, housing (via $ITB and $XHB) has consistently underperformed the broader S&P 500. Year-to-date, housing related stocks ($XHB) are down 3.4% and homebuilders ($ITB) are down 3.0%. Is this weakness set to continue? The data says ‘yes!’ Demand is rolling over as yields are backing up and while supply […]

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Weird day for Gold

Sometimes, in the market, I get a weird feeling, where something just seems off. Today was one of those days. Gold’s price action just seemed off. I like to use correlations between different asset classes to help shape a narrative for how the market is trading. While the longer duration correlation data fails to support a “risk-on”/”risk-off” […]

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Oil Lower AND Banks Higher?

Just as I predicted, OPEC is not and never planned to cut production. It’s all political theatre and tape-bomb chaos! Oil will continue to head lower and as it does, we’ll continue to see fear grow about US banks’ exposure to energy defaults. Naimi reiterated Saudi’s strategy again yesterday in Houston: choking off high-cost producers […]

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Quant Analysis: $SRPT

I like biotech stocks because of their asymmetrical risk and volatility. $SRPT – Biotech maker of, among other things, an experimental treatment for Duchenne Muscular Dystrophy (DMD). In short, a frameshift mutation on the X chromosome causes the disease, characterized by muscle degeneration and premature death in boys, usually before their 25th birthday. SRPT’s treatment, Eteplirsen, triggers excision of exon 51 […]