***SPECIAL Fed Update – Cost of Living Index at All-Time High – Dow to 50,000***
Today is FOMC statement day. The model for the S&P 500 is plus or minus 0.50% until 2pm and then volatility with a rally. There are two problems with the model today. First, stocks have rallied smartly into the meeting which pulled forward the anticipated strength. Second, this morning’s CPI release came a tad cooler than expected although the cost of living index scored yet another all-time high. Pre-market futures looks higher by more than 1%. The model says to […]
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Date: June 12, 2024
Comparing Nvidia to Dotcom Bubble, Election Impact & Reading The Fed
Comparing Nvidia to Dotcom Bubble, Election Impact & Reading The Fed On Friday we bought levered S&P 500. We sold EMB.
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Date: June 10, 2024
Analogs To The Dotcom Bubble
This is going to be a quick blog as I am traveling. I have seen some social media posts and heard some chatter from folks comparing today’s Nvidia-led market to that of the Dotcom Bubble. The most recent Chicken Little chart is below which shows the vast majority of stocks underperforming the S&P 500 index, similar to 1998-1999. Keep in mind during the Dotcom Bubble, this condition last more than two years. Additionally, market participation is worlds better today than […]
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Date: June 6, 2024
Now It’s a Slowdown
Inflation, inflation, inflation. Jobs, jobs, jobs. That’s all we’ve heard all year. Yet, this week the narrative seems to have changed to a slowdown. Is it the elusive “soft landing” so many positioned for in 2024? Is it recession? For now, it seems like just chatter and drivel without hard data backing it up. Let’s take a look at the 10-Year below to see what the market is fussing about on the far right of the chart. Yields have come […]
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Date: June 5, 2024
May Certainly Ended With a Bang
I had my 40th high school reunion on Saturday. Since reunions started at the 5 year mark, the only one I have missed was my 35th when I had that tiny little mishap with that 50 foot silver maple and those 35 broken bones. It was so much fun to see old classmates and friends whom I hasn’t seen in years. Thankfully, Facebook lets many of us stay in touch. Very uncharacteristically for me, in my excitement to catch and […]
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Date: June 3, 2024
How Quickly Things Change
On May 22nd after the close, Nvidia reported blow out earnings and announced a 10:1 stock split. I said the stock should exceed $1000 in after hours trading and it did, but that’s not relevant. What was super important about the next day was that while Nvidia surged higher, the rest of the market gapped and crapped, meaning the stock market shot up at the open and then sold off the rest of the day to close at or near […]
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Date: May 30, 2024
Transports Lagging Badly Since 2021 – But Does It Matter?
Friday saw a new closing high in the NASDAQ 100 which was unaccompanied by any of the other major indices. That index is below. It really doesn’t see clear skies until it closes above last Thursday’s nasty reversal day. The S&P 500 and Russell 2000, both below, obviously look weaker, but the former can be repaired rather easily. The latter not so much. What I have really wanted to discuss was the Dow Transportation Index which has been super weak […]
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Date: May 28, 2024
Not Even Nvidia Could Prevent The Plunge – Time To Prune
As highly anticipated as Nvidia’s earnings were and the huge reaction, Thursday was an even more consequential day in the stock market. First, as I wrote about on Wednesday, I fully expected Nvidia to blow out earnings and the stock to soar above $1000 in the after hours trading on Wednesday. I don’t think there was any great stretch there or new revelation. The biggest test would be after the open to see what the stock did. For a while […]
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Date: May 24, 2024
Nvidia – Poised To Hit $1000+ After Hours
Given that Nvidia has become THE most important stock on earth, I expect the media to be completely obsessed about it all day as the company reports Q1 earnings after the closing bell today. It is now one of the most over-owned stocks on earth, present company included, with very few detractors except for those based on valuation and price. I have written about pruning the stock a number of times, most recently in March, as it looked like a […]
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Date: May 22, 2024
Low Volatility Is Bullish – Ignore The Lazy
This past Friday was your typical options expiration which used to be a somewhat important affair. Over the years, it has almost become a non-event with all the more frequent options being traded weekly and now daily. A tried and true trend about strength into last Friday and weakness the following week kicks off today. I don’t think it’s anything big to the downside, just maybe a modest pullback. As I thought about that old study I just mentioned, I […]
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Date: May 20, 2024
