Financial News vs. Noise
Two down weeks in a row for SPX and we have FOMC this week. I added some more hedges on Friday but this still clearly looks like an uptrend.
Investors should buy cheap portfolio insurance now before stock market turns volatile, Goldman warns-MarketWatch
I see a lot of charts that look like short sale entries, but besides having hedges I am not ready to go there yet.
The 20 day EMA has held for the entire ride up, and that’s where we are now.
This on the other hand looks a little more troubling. The NDX has not been able to hold the 20, but every move below has been swiftly bought up.
Small caps have been the weak spot this year, but nothing in this chart screams sell. IWM has been able to hold the 50 day.
This is a bit concerning. It looks like rates want to rise. However, the bond guys are as confused as everyone else about what the Fed is going to do.
Meanwhile, active managers are all bulled up.
So aren’t the individuals.
Precious metals look like they expect rate cuts on schedule.
Oil looks like it is trying to start an uptrend.
Bottom line I think you lean long but have hedges in place, and you should probably have a mix of hedges. I have short dated SPY puts, longer dated SPY put spreads, longer dated VIX spreads, and short dated GLD puts.
My sense is that this is a very important week with where the indices are and FOMC. I cannot imagine being a Fed head and looking at this data and thinking we have to cut rates.
Mag 7 was weak on Friday, except for TSLA. Wouldn’t read too much into that as TSLA won’t go down forever. Still think $150 is the most likely destination there. The MSFT breakout failed. Besides that, nothing too interesting here.
Crypto miners came back, they continue to be extremely volatile. At the point I only have CLSK.
I got out of my BITO calls Friday, but will be looking to get back in, just think Bitcoin needs to digest a bit.
Coming into the year I thought Brazil and Argentina would be areas I wanted to trade. Argentina has been great, Brazil not so much. Considering taking Brazil names out of my models.
EWZ has some support at 32 so will see how it reacts.
PBR is a name I am in that’s at a real important spot. Big gap to fill on the upside if it can break back above the 200 day.
CCJ is a name I mentioned on Friday, continue to like how this looks.
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