Powell On Tap With Dovish Songs
With the stock market’s winning streak ending a few days ago and Thursday being down moderately, will the media run crawls on screen today that stocks have been down two of the last three days? Will it be “BREAKING NEWS”?
Today is Fed Chair Jay Powell’s annual speech from Jackson Hole, Wyoming. It has been on the calendar on all year. I expect it to be brief and dovish, but not offer cadence on how rate cuts will unfold. The Fed will be cutting interest rates next month and probably 0.25%. None of that is a stretch. Most expect the same thing.
What we don’t know is how markets will react. So many times it is much easier to forecast an event than how markets will react. Had stocks run hard right into today, I would have said that today is a selling opportunity. Had stocks sold off hard I would expect the opposite. After yesterday’s moderate reversal with decent downside, a bounce would be ordinary fare. And stocks look higher in the pre-market.
The odds favor that trend most of the day today. We should be concerned if Powell speaks and then stocks go red. That would not be according to plan. Powell saw in full sight what happened on August 5th when the Japanese stock market crashed 12% as the Yen soared.
The Yen chart is below. Funny how the Yen rallied for four straight days recently, but the markets just yawned and the media said nothing.
The last full weekend of August is here. I already miss vacation on Martha’s Vineyard with the family. That is one insanely crowded place. We had all meals together. We went to the beach together. We played cards together. We binged shows together. We enjoyed beverages together. We were inappropriate together. Well, more them than me. I ate ice cream 5 straight nights. Had salt water taffy and moon pies. Found delicious lobster rolls, fried clam strips, bellies and even some less healthy food. For us, the location doesn’t matter as much as the little things I “force” everyone to do together. A luau with friends awaits tomorrow.
On Wednesday we bought EPU, TQQQ, more EWT and more levered NDX. We sold levered inverse NDX. On Thursday we bought levered S&P 500 and levered inverse NDX. We sold XOP, RYVIX, FTEC, MRNA, some RYOCX, some levered NDX,some COIN.
