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NYC Client Happy Hour

Y O U   A R E   C O R D I A L LY   I N V I T E D   TO

JOIN HEDGEYE TO DISCUSS OUR BEST IDEAS

(AND ENJOY A FEW LIBATIONS)

 

 

 

hosted by

NYC Client Happy Hour - LOGO

 

 

 

6:00 – 9:00 PM

WEDNESDAY NOVEMBER 28, 2012

PLEASE RSVP TO 

 

 

 

ZENGO RESTAURANT

SAKE & SHOCHU LOUNGE 

622 3RD AVE, 40TH/41ST, NYC

 


Lower-Highs: SP500 Levels, Refreshed

POSITIONS: Long Bonds (TLT and FLAT), Short Industrials (XLI)

 

I sold our long Utilities (XLU) position this morning because it was up. When something is up, but fails to re-capture TREND support, I sell it. That discipline holds for the US stock market post last week’s no-volume bounce to lower-highs too.

 

Across our core risk management durations, here are the lines that matter to me most:

  1. Intermediate-term TREND resistance = 1419
  2. Immediate-term TRADE resistance = 1406
  3. Immediate-term TRADE support = 1379

In other words, as we make lower-highs, the probability of the YTD highs for US stocks for 2012 being in (September 14th) are rising.

 

As a result, with the TREND bearish, you’ll likely get paid to risk manage the range between 1364 (TAIL support) and 1419 (TREND resistance) proactively. In the meantime, the bond bull driven by #GrowthSlowing rages on.

 

KM

 

Keith R. McCullough
Chief Executive Officer

 

Lower-Highs: SP500 Levels, Refreshed - SPX


CHART DU JOUR: THE END OF THE MASS HOLD TAILWIND?

Takeaway: This could be a big negative for Macau stocks

Mass revenue growth has outpaced volume growth.  With Mass hold % plateauing, revenue growth is likely to slow.

 

  • Over the past four years, mass revenue growth has significantly outpaced volume growth as mass hold rates climbed higher and higher
  • While the higher hold is likely sustainable – due to rationalization and productivity – we’re concerned that investors may not be aware of how much hold has played a role in the 3+ year surge in Macau Mass growth
  • Mass volume growth has lagged revenue growth by an average of over 10%.  Going forward, Mass revenue growth is likely to track volume growth which means slowing growth trends.

 

CHART DU JOUR:  THE END OF THE MASS HOLD TAILWIND? - MAF


Daily Trading Ranges

20 Proprietary Risk Ranges

Daily Trading Ranges is designed to help you understand where you’re buying and selling within the risk range and help you make better sales at the top end of the range and purchases at the low end.

Watching The Eurozone

It’s important to keep an eye on yields for government bonds throughout the Eurozone; it provides insight into the confidence investors have for each country. 10-year bond yields are lower on a week-over-week basis as Greece continues to be bailed out. Remember: European Central Bank President Mario Draghi will do “whatever it takes” to save the EU. The lower the yield, the lower the risk.

 

Watching The Eurozone - 10yearEURO


MACAU: STEADY AS SHE GOES

Macau average daily table revenue (ADTR) remained unchanged from last week at HK$775 million.  For the full month, we are projecting YoY growth in GGR of 5-9%, above October’s 4% growth.  December growth should be even better than November’s.  We believe hold was normal this week and that mass traffic continues to be strong.

 

MACAU: STEADY AS SHE GOES - macau234

 

Relative to market share trend, Galaxy continues to be the laggard in November while LVS is pushing towards 20% again, above its trailing 3-month share of 18.8%.

 

MACAU: STEADY AS SHE GOES - macau345


Natgas On The Move

There’s been a lot of talk about how natural gas is poised to make moves in 2013. Looking at the amount of natgas rigs out there, we see that rig count increased by 11 on a week-over-week basis according to data from BHI. That’s the biggest week-over-week increase since September 2011. 4 rigs were added in the PA Marcellus and 3 gas rigs were added in Louisiana. Energy Sector Head Kevin Kaiser notes that the best way to play the resurgence in natgas drilling is to go long pressure pumpers like C&J Energy Services (CJES).

 

Natgas On The Move - natgasrig


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