Andrew Giovinazzi's blog

IBM is back so party like it's 1992-1994

 With all the ’87 Crash reminiscing I figured it was time to reach into my nostalgia bucket and come up with IBM.  The early 90s were mostly about the death of IBM and rise of MSFT in tech.  I remember traders selling calls upon calls in IBM as it went into the dustbin for several years as the mainframe went the way of the Dodo.  Seems over the last several years IBM has had the same issue as in the past with falling revenue while still being somewhat profitable.  Wall Street hates that.

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VIX futures the quicker picker upper

For a moment there I thought hell froze over as a bi-partisan plan for the AHCA might keep it running for two more years.  Keep buying the insurance companies I guess.  Today was such a snooze that I have to go observational.  NFLX was not enough to excite although 70% stock price gains this year are exciting enough.  Let’s talk VIX because it did something slightly not normal but normal today.

charts from VIXcentral.com

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AMZN gives WBA the boot

Ever since this summer when AMZN kicked the tar out of COST and WMT for buying toney retail space owner WFM, I have been waiting for the next victim.  Meal maker BLUE got thrashed but that was kind of a David and Goliath battle anyway.  WBA is no market pansy but rather a real heavyweight globally in prescription drugs.  It did not matter much as the leader premium got kicked out of WBA in a hurry.

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The market greets WMT

Not much to write about today.  The biggest news is that the NFL might review its “take a knee” policy and that as you know would overshadow any economic news.  I did find headlines about the Chinese government taking an “active” role in the big Chinese internet companies and I am thinking long term that cannot be good.  BABA and BIDU were both done a bit after torrid runs.  My story for today is WMT because it broke the 3 day rule I just wrote about and what the heck I own it too.

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The 3 day rule

The 3 day rule

No, I did not invent the 3 day rule, but I like it.  In the old days a stock that went up 3 days in a row was susceptible to a pullback.  The 90’s put the rule on hold and QE messed with it as well.  Basically it is the old tape readers logic that 3 days in one direction is not sustainable.  With equity prices it is not a bad swing run timing thing, but it works very well for volatility, QE be damned.

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NVDA to the moon and beyond

Not very long ago NVDA was a $30 stock.  Now that the world has caught on to the many uses of GPU’s NVDA is a $190 stock.  Citron hated it at $100 and that was $90 ago.  With earnings coming up the MOMO crowd will not be able to let NVDA go so I think there is reasonable support for the name.  The question is if I can make some upside cheap enough.

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Shut the door, VIX is up two days in a row

It happened! The streak of sub-10 closes is going to end for VIX today and I am not sure why.  Yeah we had some weekend effect and the morning rally in tech went kaput, but actual SPX move was pretty light.  I think this is the one time in IV where VIX rallied because traders were looking at the upside instead of the downside.  Sub-10 VIX is still pushing on a rope with vol expectation to go lower.

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