Tough Open, Decent Close

Dow: +59.87…
Nasdaq: -5.74… S&P: +6.55…

The S&P increased 0.2% today to close at another record high. The Dow (+0.2%) and Russell 2000 (+0.1%) also eked out gains after starting the day on a lower note, while the Nasdaq finished lower by 0.1%. 

The market struggled out of the gate amid profit-taking pressure, lingering stimulus hurdles, a weaker than expected ADP employment report for November, and weakness in Salesforce (CRM 220.78, -20.57, -8.5%) following its confirmed acquisition of Slack.

If you were watching things at the open they really hit tech, but then lifted them later. As a result of the fairly violent opening in tech, we got stopped on a couple of names.

As of last week, call volumes were 4x normal, and even more striking: call buying has just gone parabolic and now represents about 40% of NYSE total volume. This is the highest reading in history.

OK to be long, but it pays to be real careful when you see readings like this.

The metals are still percolating and I’m watching the usual suspects again: AGQ, SIL, SILJ, GDX and GDXJ

DXY broke below the 92 level a few sessions ago and the move lower has continued. The negative trend channel remains very much intact.  

The crowd has covered some dollar shorts, but remain very short. One of few trades lately that most seem to be right on when it comes to positioning.  

Robinhood gained approximately 3M new users in the first 4 months of 2020. These so-called “pandemic day traders” traded 9x as many shares as E-Trade users and 40x as many shares as Schwab users during Q1’20. They also traded 88x as many risky options contracts as Schwab users during that period.

P&L here.

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