Volatility Rumbles as a Market Reversal Looms
We just lived through the most volatile week this year - and a lot of people following along with my picks got the chance to clean up. (More on that in a second.) And I don’t think we’ve seen the last of the turbulence…not by a longshot. Tonight we’re going to look at what we…
Fear and Loathing Ahead of Payroll Numbers
After a morning of calm, steady gains, the markets got a significant jolt of dread this afternoon. News hit that Israel was boosting security measures at its worldwide embassies and consulates in anticipation of Iranian retaliation for a recent Israeli attack. This whipped the bulls and in a matter of minutes, the day’s gains turned…
Markets Are at All-Time Highs...But the Economy Is Slipping
Dozens of the biggest stocks on the market are at or near their all-time highs. Valuations are still at nosebleed levels. So why don’t I feel great? Because unlike the market, where hopium and craziness can take you really, really far, severe cracks are starting to show in the U.S. economy… where hopium and craziness…
The Sellers Are Kicking Off the Action This Quarter
The second quarter of 2024 is here, and so far the sellers are running the table. Bonds are selling off and the prospect of a 5% 10-year Treasury yield looks closer than it has in a long time. Investors there have made their decision on inflation. Stocks are bleeding out, too, led by the tech…
Bond Yields Break Out… And This Energy Trade Just Exploded
Equities had a decidedly mixed day - just three of 11 S&P 500 sectors finished higher by 4 PM. The energy sector, as tracked by the XLE ETF, was one of those standouts, and it’s easy to see why: Geopolitical risk and tension is continuing to increase, and supply is getting thin. Oil in particular…
Complacency, Inflation, and Time for a Hedge
—Inflation in-line but not dead —anemic volume at the end of the quarter —NVDA and tech squeeze full stop —XLK under performs INTC, AAPL, TSLA —correlation higher —financials and energy —watching retail —time to hedge SPX Expected Move -- --last week -- 54.11 (4--day expected move) --next week-- 62.52 (5--day expected move)
NVDA Double Top Formation Impacts Everything
It has been apparent to most investors that AI and specifically NVDA has driven markets to record highs. NVDA is finally showing signs of slowing and even a potential trend reversal pattern, a double top. If the Double Top is confirmed, we expect correlated moves in indexes and individual stocks. Today we discussed the potential…
This will Determine the Next Move for Stocks
Market radar is strongly honed in on the bond market right now. Whether it breaks to the upside or downside will likely be a major determining factor in terms of sector leadership in the stock market. Will growth, tech, and communications continue to outperform or will we start to see the inflation trade reignite in…
Vol Markets Flash First Warning Since December as NVDA Tests High
One of the sources of fuel for a market rally is volatility selling. However, it's the selling that ultimately leads to the last squeeze higher before the fall. Looking at term structure of volatility and skewness is a way to identify volatility expectations and hedging. Over the past few days, these vol-based indicators have been…
These Indicators Signal a Change Coming to the Markets
I’ve been absolutely pounding the table on this for more than a week now. The correlation between Big Tech market leaders and the S&P 500 is getting stronger, not weaker. And that means a correction will be knocking on the door any second now. Higher SKEW and much lower volatility points to that. Low options…
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