Doors Open

VIEW ONLINE

UPCOMING EVENTS

Doors Open A happy Monday to the mothers, the markets, and the manipulators. I hope you all enjoyed the holiday. As for the latter two, I would guess that if they could have their way, there would be no days off. Just look at the casinos. They stay open 24/7, 365 days a year. When you are running a rigged game, why would you ever want to shut the doors? Let's look at how our favorite manipulator, the Fed, plays the game. They give special treatment to their wealthy powerful friends. – Just like Las Vegas. The casinos are more than happy to roll out the red carpet for wealthy foreigners ready to drop their dollars. Same story with the Fed. A JPMorgan analysis, cited by the Wall Street Journal, discovered that in 2014 the Fed would pay $6.74 billion in interest to the banks that park their excess cash at the Fed – half of that amount, so a cool $3.37 billion, would line the pockets of foreign banks with branches in the US. This is where part of the liquidity ends up that the Fed has been handing to Wall Street through its bond purchases. Currently, the Fed requires that banks keep a minimum balance of $80.2 billion at the Fed. Banks can keep up to $88.2 billion at the Fed as part of the "penalty-free band." In theory, as "penalty-free" implies, there'd be a penalty on balances above $88.2 billion. But the total balance was $2.66 trillion in April, up from $2.62 trillion in March and from $1.83 trillion a year ago. The balances in excess of the "penalty-free band" have reached $2.57 trillion. The highest ever. The penalty on that? Forget that. The Fed's raison d'être is to enrich the banks regardless of what the costs to the economy, the rest of society, and savers. So instead of penalizing banks for these excess reserves, it pays the banks 0.25% interest not only on the required balances but also on all other balances. Spread over the year 2014, as JPMorgan estimated, interest payments on these balances would amount to $6.74 billion. It pays to keep the doors open in this system. Read Past Issues of Larry's Newsletters at TradeWithLarry.com

We finished off a volatile week of trading Friday as we limped into the close to finish off in positive territory. It seems while there is some suppression at hand in the markets, we could be set up for a strong push in one direction. I do feel it will make another push for all time highs, and then we can press lower pretty quickly. That has been the pattern as of late, and if the pattern breaks, we could see an explosive move. I'm looking a push to the highs with immediate retracement. Read More

TECHNICAL DATA ES 1872.75/1864.25 POC 1874.00 YM 16528/16468 NQ 3544.00/3520.50

Today, part three of our discussion on implied volatility and how it figures into our signal methodology. First, we defined what implied volatility was noting that it was a proxy for an annualized, one standard deviation move in the underlying. Then, we discussed how to relate implied volatility and historical volatility. Today we discuss how the implied volatility of different months within the same underlying can be different, and if they are, how this presents trade signal opportunities. We spoke how specific events such as corporate earnings, corporate actions, regulatory findings, etc. can send IV higher. It also can create changes in the time structure of IV. Read More

unsubscribe  |  update preference  |  visit website

Trading Advantage , all rights reserved 2014 ©

IMPORTANT NOTICE: The risk of loss in trading futures, options on futures, stocks and stock options can be substantial and is not suitable for all investors. Past performance is not necessarily indicative of future results. Trading Advantage LLC only provides educational services. By accessing any Trading Advantage content, you agree to be bound by the terms of service. Click here to review the terms of services. The hypothetical signal results shown above represent signals offered in real time in the training room. A signal does not get posted unless there is a reasonable likelihood that if an order had been placed it would have been executed. Further, adjustments are made to simulate the costs of commissions. Past performance is not necessarily indicative of future results. The posted information is shown for educational purposes only and no signal shown was actually executed as a trade. Hypothetical or simulated performance results have certain inherent limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not actually been executed, the results may have under- or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profits or losses similar to those talked about in our site.

Copyright © 2014 Trading Advantage
Our address is 111 West Jackson Blvd, 1122, Chicago, IL, 60604, USA
 
If you do not wish to receive future email, click here.
(You can also send your request to Customer Care at the street address above.)